The Birmingham age-herald., 1905-10-08
IMPORTANT SUIT
 ABOUT INSURANCE Insurance Commissioner Will
 File Suit Against Robt. Garry REQUIRED TO QUALIFY Certain Per Cent of Losses Settled Must Be Paid State By Com panies Which Fall to Qualify.
 

Secretary of State and Ex.-Officio Insur- !. ance Commissioner E. R. McDavid will order Solicitor John Mcqueen of the Tenth judicial circuit, to bring suit for sS50O against Robert Garry, a we'll known wholesale merchant of this city, whose store at the corner of First avenue and Twenty-first street was recently destroy cd by fire.
 The suit, which promises to attract great deal of attention in both insur- ance and legal circles, was brought against Garry for his alleged failure to comply with certain sections of the Ala bama law in regard to placing insurance with companies not qualified to do bust ness in Alabama.
 According to section 26O5 of the code of Alabama, anyone placing insurance with cont anies not qualified under the Ala bama law, must report the same to the insurance commissioner and pay per cent of the gross premiums to the state. In the event of loss one-half of per cent on all amounts paid must be given to the state.
 It is charged that Garry had placed insurance risks with r different com- panies which were not qualified to do bus ,iness in Alabama. It is also said that this section of the code is not general ly known among the merchants, and that others are guilty of the same violations. Commissioner McDavid will prosecute ali those pot complying in every particular witE the law. The $S500 which will be demanded is for $500 in each of the IF cases.
 Section 2G1S of the code, providing for the penalty for a violation of the sec ton above mentioned, states that in case of failure to fulfill the requirements of the law, tie offender shall on conviction be fined not more than $500 and sentenced to not rlore than six months in the Jaii' lf the ra. ment is not made
 Solicitors Duty.
 The insurance commissioner is empow- cred to instruct the solicitor of the dis trict m which the failure occurred, to bring suit to recover the penalty, and shall tuin the money over to the state, hIess .5 per cent to be retained as his fee.
 Fo. Secretary of State Robert P. McDavid, wno is familiar with the law s,ou tbe suDJect, had the following to say in regard to it yesterday'
 ..The law was originally designed for the benefit of both the policy holder and the local agent. The law provides that com 5panies. to become qualified under the laws Of this state must pass an examination as to their solvency, and pay a tax or 1 per cent on the gross premiums. Com panies not doing this cannot be excluded from doing business in the state, owing to certain provisions of the interstate commerce law. The insured can, how ever, be required to pay tax equivalent to that which would be demanded of the companies.
 Local merchants, I understand, ignor- ant of the law, have placed their insur- ance with companies not qualified to do business here, owing to the fact that they could secure cheaper rates. The act of the insurance commissioner should serve as warning to other merchants who have placed their insurance with out side companies