The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1914-09-23
Superintendent Insurance Re.
strained by Pollock
From Ousting National Surety
Firm From State.
FI6HT. OUT THE ISSUES SOON
Right of Department to Cancel
Corporation Permit.
Shawnee Fire Brought About
First Proceeding.

Ike s. Lewis. state superintendent OF
Insurance, was today restrained from
suspending from business or ousting
from the state the National Surety
company. a foreign corporation doing
business in Kansas under a permit
from Lewis office. The restraining
order was issued by Judge John c.
Pollock of the United States district
court for the district OF Kansas upon
q showing that Lewis threatened to
Gust the surety company If it sought
to remove to the federal court a case
filed in the Shawnee county court
against the foreign bonding company.
The restraining order against Lewis
was made returnable at Wichita next
Monday morning. 1t is probable that
the issues IN the case will be fought
out at that time. In the fight to en-
join the ousting OF the surety COM
pany, it is probable that Judge Pol
state department to arbitrarily cancel
the permit of corporation when in
the judgment of the insurance depart
ment it has violated a provision of its
contract
Suit to enjoin the busting of the Ma
upon the pleadings on file in the case
OF the Shawnee Fire Insurance COM
pany. a Kansas corporation. which re-
Gently sought to recover $4,000 from
the bonding company" The Shawnee
people alleged in their petition that the
National was surety for the firm OF
Newman & MacBain, representing the
Kansas insurance company in New
York. The Newman & MacBain bond
was for $50. 1t was charged by the
Shawnee Ere people that the firm ham
died q large amount of eastern business
and failed to turn over to the company
large sums Of money collected as pre-
miums. In a suit in New York state.
JUDGMENT was secured against Newman
4 MacBain in the sum of $55.9O4a7 with
costs amounting to about $4,000.
Shawnee Started 1t. .,
The Shawnee Fire Insurance COM
pany recently filed suit in the Shaw
nee county district court to collect the
amount Of their judgment from the Ma
tional Surety company. With the filing
Of the suit, the defendant bonding COM
pany filed petition for removal to the
federal court on the ground that there
was a diversity OF residence OF the two
CORPORATIONS.
1t was while this motion for removal
was rending the bonding company as
serts. that the state insurance depart
ment threatened to GUST the company
from doing business in Kansas u it re-
moved its case from tie jurisdiction of
the state courts. To protect itself from
removed and to keep alive and in force
it, business in Kansas. the surety COM
pany appealed to Judge Pollock for a
restraining order. At almost the same
time the restraining order was issued.
Judge George H. Whitcomb granted the
application for an order removing the
case to the federal court.
Now Judge Pollock will pass both upon
the right of the state insurance depart
ment to ust corporation from the state
for alleged failure to honor a contract
and also upon the merits of the contro-
versy between the Shawnee Fire Insur-
ance company and the bonding company.
1t Is probable that Superintendent Lewis
will appear at the hearing in Wichita next
Monday and with Attorney General John s.
Dawson will fight the. application for
an Injunction against the cancellation OF
the surety company's license or its re-
moval from the state.
In the controversy between the state
officials and the bonding company. II is
probable that the famous Hillman case
will be largely relied upon. 1t was in the
Hillman case that Webb McNall. former
insurance superintendent. first assumed
the right to cancel the permits of insur-
ance and bonding agents and the, case
was for years fought fthroutk, the state
and federal courts.