The sun. [volume] (New York [N.Y.]) 1833-1916, 1906-10-22
FORD, CORPORATION LAWYER.
ASK THE CASUALTY CORPORA
TONS IF he ISN'T.
he Was Able at Albany TO Hold Up an Enec-
tive Franchise Tax Law Until the Hn-
surance Law was Amended 10 Suit
somebody VINO wanted TO Expand.

Somebody VINO wanted to Expand.
Jobn Ford, one Of the candidates for
Rrpreme Court Justice Of the Hearst
Mirpb, combination, was the Republican
stat, senator for the old Nineteenth district
for two terms. running from 1895 to the
close Of 1899. Mr.. Ford, on September II.
st Carnegie Hall. was nominated by Mr..
Hearst's independence Lea que for Attorney
General, but when Mr.. Hearst had been
Ipdorsed by the Democratic State con-
yentlon at Buffalo on September 20, along
With his candidate for Lieutenant-G Governor,
Lewis Stuyvesant Chanler, he returned
70 New York and tumbled out Mr.. Ford
and all the other candidates for State
offices on the Hearst ticket except Mr.
Cbanler. All are now familiar with the
pickering and bargaining between Mr..
Hearst and Charles + Murphy Of Tammany,
which ended in MIR. Hearst demanding
and receiving from Mr., Murphy four Of
The ten nominations for Supreme Court
Justice in New York county. Mr.. Ford is
ene Of the four.
Mr.. Hearst's opposition to corporation
attorneys did not extend to Mr.. Ford any
more than il extended to NJ. Marley PIatzek,
Mitchell L. Erlanger, Charles v. Dayton
and Peter A. Hendrick on the Hearst
Murphy Judiciary ticket.
Mr.. Ford has always described himself
o. the author Of the State Franchise Tax
law. In January, 1899, he introduced the
bill at Albany, and it slumbered in com
mittee until early in April of that year,
when it was yanked out Of it's pigeonhole
6y direction of Theodore Roosevelt, then
, Governor Of the State, who proceeded to
force It's passage by several emergency
messages. After much opposition, which
was met by strenuous measures oil the
mart of Gov. Roosevelt, Ford's Franchise
Tax bill was passed, and the Legislature
adjourned April rs, 1899. II was quickly
apparent after the Legislature adjourned
that Ford's Franchise Tax bill wa uncon-
stitutional in spots, clumsy in others. I'M
wieldy in more, and 80 many defects in
n were discovered that the bill was actually
lnoperative as passed. Gov. Roosevelt,
Welding TO opportunities, called. on May II,
1899, an extraordinary session Of the Legis-
lature, bo meet at Albany on May ~, for the
purpose Of amending Ford's Franchise
Tax law 80 thatit could be made operative.
Gov. Roosevelt, after calling the extra
ordinary session OF the Legislature, found
that Ford wouldn't vote for the amend
ments to the Franchise Tar law, even
though Ford was told plainly that the bill
As passed was unconstitutional and inopera-
tive. Ford, however, held out, n de-
clared that he would not vote for the amend
nents making the bill constitutional and
operative.
. Then Gov. Roosevelt learned that il he
agreed to sign an insurance bill which
Ford had introduced Ford would vote for
the amendments, and 1t was absolutely
necessary TO have Ford's vote in order to
pass the amendments to the franchise
tar law.
Concerning Ford's attitude at that time,
his refusal to vote for the amendments to
make his own bill constitutional and opera
tive, it Is in order TO print herewith a copy
Of the memorandum which Louis F. Payn,
then Superintendent Of Insurance, filed at
that time with Gov. Roosevelt in opposi-
ton to the insurance bill which Ford had
introduced. Here is the memorandum:
Hon. Theodore Roosevelt. Governor, Executive
Chamber, Albany.
SIR: Az your request, conveyed to me by
Mr.. Appleton Of this department. l furnish
you with the following memoranda OF my OBJ
~iections to Senate bill No. 1908. Executive No.
$40, introduced by Senator Ford. being An
act to amend chapter 800 of the laws OF 1902
entitled An act in relation to insurance corr
porations constituting chapter IS OF the gem
eral laws relating to powers OF casualty In.
surance corporations
The proposed amendment il the addition TO
subdivision 4 Of section 10 OF the insurance
law Of the following:
Guaranteeing and indemnifying merchnts,
traders and those en- gagged in business and
giving credit from loss and damage by reason
OF giving and extending credit to their GUS
TONERS and those dealing with them; and corr
porations authorized to do such last named
business in this subdivision mentioned shall
have all the powers conferred by section us
OF this chapter
Thus A surety company with a capital OF but
$780, 900 and a deposit with this department
Of but 800, 900. without any additional capi-
talization or without any additional deposit,
will be permitted to extend Its lines Of BUSH
ness so as TO assume credit guaranty risks.
The second subdivision Of section 40 Of
Article v. Of the insurance law permits the
erganizaaon Of corporations to carry on this
very line Of business. namely, that OF credit
guaranty insurance, and requires a capitalism
6on Of at least $3.50, 900 and a deposit Of
' 10000.
In my opinion, it is against public policy e
permit a casualty insurance corporation oper:
atinR as a surety company under the fourth
subdivision Of section 20 Of the insurance law
10 extend its business TO that Of credit guar
gnty insurance, Whlcn ~ extra uh1hIuOuS anu
should not be associated with any other line
Of insurance. An amendment Of this charac'
ter is certainly an entering wedge in the
direction Of breaking down the classiiica'
Cons contained in the present insurance law
It being the intention Of such law TO subdivid'
the different lines Of insurance which may
be carried on by a single corporation.
The Attorney-Genersl Of the State has or
more than one occasion held that q corpora
ton OF ganized under one article OF the In
surance law cannot properly carry on thc
business provided for under another article
Of the insurance law. In this connection
would refer you TO an opinion in the matter oi
foreign marine insurance corporations au'
thorized under Article ". attempting "a
transact the business Of inland marine in
sursnce as provided for in Article III, 1t belni
expressly held that such corporations coulc
not. after the passage OF the law Of 1892 operate
90 as to assume the lines Of hazards contem
plated under both Articles III. and Nv. thereof
unless such corporations had q right ACQUIRED
prior 70 the passs &c OF the law Of 1892. In thu
case Of a foreign credit guaranty corporation
ofanother country admitted as such and after