The Birmingham age-herald., 1907-04-08
GROVER CLEVELAND DEFENDS SALARIES Says Life Insurance Presidents
 Are Not 0verpaid FOURTEENTH AMENDMENT Former President Claims That Legal Restrictions of Salaries Is Con
 trary to This Clause of Fed
 eral Constitution.
FOURTEENTH AMENDMENT

New York April 7.-Former President Grover Cleveland, counsel for the Asso- citation of Life Insurance Presidents, has just submitted to the association a brief in relation to the matter of salaries paid by life insurance companies. The oc- casion for its presentation, it is stated, is the fact that certain states have now pending before their respective legisla lures bills that would limit the salaries of life insurance officers to $5o,0OO a year. while in others the limit is fixed at $25, eco q year.
 The brief, it is announced, will he filed tomorrow with the Wisconsin legislature by Robert Lynn Cox, who will appear as attorney for the Association of Life Insur- ance Presidents.
 After calling attention to the fact that insurance companies are private corpora tions, MT. Cleveland says:
 Contract Restrictions.
 Whether these companies are classed as stock corporations or mutual corpor- ations, in either case their business in- terests are confined to contract relations, and is based upon the execution of life oi ollci iiCtdtiiln dlldCHliiB CAtiusiNtiy u the individual policyholder in each cor poration. It has been judiciously deter mined, beyond the reach of controversy, that in legal contemplation these com panies are within the definition of persons, and so far as their rights are concerned they are on the same footing as citizens of the United States and of the several states. The fourteenth amendment of the federal constitutions provides that no state shall make or enforce any law which shall abridge the privileges or i'm munities of citizens of the United States. nor shall any state deprive any persons of life, liberty or property, without due process of law.
 Tt is clearly the intent and inevitable effect of the contemplated legislation to abridge these privileges and immunities' of corporate citizens of the United States by imposing upon them limitations con cerning the compensation to be paid their officers and employees in the face of the law of their creation and domicile, which makes them free from such limitations. A law which forbids the possession and en- joyment of property by. life insurance companies, except upon a condition which involves the abandonment of their right to contract for the equipment and man agement of their business-a right inher ent to their organization. permitted by the law of their creation and necessary to the protection of the interests they have in charge-and a condition which exacts as a price for doing business, a surrender of the guidance of sound Judgment and safe experience in its prosecution, under penalty of forfeiture of interest to which, in common justice, they are en- titled, cannot be regarded otherwise than bald unequivocal and unmitigated de- privation of privileges, immunities and property, without chance for escape.
 Legislation of this character is so startling as to indicate a disposition to depart from all conservatism touching state supervision and regulation of life insurance companies"
 Quotes Decisions.
 He then quotes from several decisions of the supreme court of the United States and goes on to say:
 Measured by the standards fixed by the adjudications of the highest tribunal of the land 1t seems quite certain that the legislation being considered would amount to an unconstitutional use of state legislative authority. It cannot be claimed that 1t would promote either the health. peace. morals, education and good order of the people, or increase the in- dustries of the state, develop it's re- sources and add to it's wealth and pros perity It does not proceed within req sonable limits and general usage, but goes far beyond all former excesses of state legislation and results in clear and hostile discrimination against particular persons and classes. Instead of a fair. reasonable and appropriate exercise of the power of the state 1t assumes the of an unreasonable, unneces- sary and arbitrary interference with the rights of the individual to his personal liberty or to enter into those contracts in relation to labor which may seem to him appropriate or necessary"
 He then takes up for consideration sal aries paid to presidents and first vice presidents in twenty-nne leading com panies, including the five large companies that pay $50,000 more and adds:
 From this examination that the total premium receipts from the twenty  companies amounted to $40, ,665,908; that the per cent of these receipts paid to presidents and vice presidents by all the was 29-100 of 1 per cent; that the per cent of their premium receipts so expended by the twenty-four com panies paying salaries less than $50.000 was 51-100 of l per cent; but that the per cent of premium receipts so expend- ed by the five companies paying to their presidents and vice presidents s50,000 per annum, or upwards, amounted to only 19-1)0 of l per cent. In view of the uni versaly conceded solyency and sound ness of all companies paying these larger salaries, no one can have the hardihood to claim that the small percentage of their premium receipts thus expended could by any possibility impair the ab- solute securities of their policyholders' contracts, which phase of the subject might properly be considered a legitimate subject of state sollcitude and the con- alterations of solvency and absolute curity gain conclusive force from the fact that the admitted assets of these five companies amount to more than one