Grand Forks herald. [volume] (Grand Forks, N.D.) 1916-1955, 1922-01-11
EXPLANATION OF
HAILNSURANCE
!. Law IS ASKED
Necessary 50. That Deals on
Hal Warrants Can Be
Contaminated.

Bismarck, N. D., Jan. 1.-THE SUI
preme court is asked in an order GER
titled to 1t by District Judge Coffey to
'construe points in .thesstate hail insur-
ance law at an. early @date. the high,
court being informed that a c%onstruo-
ton of the points is necessary so ne
gotiations for sale of warrants to out
of state concerns can be consummat-
ed. 81 .. 5
The questions are whether the hail
warrants are negotiable or non-nego-
table, and are they payable ratably
out of the fund collected for, the year
of their payment and if the fund is
insufficient to pay in full, should the
warrants be prQ@rated. Judge Coffey
held that the warrants are not nego-
table and that they are payable in
full and should not Dc pro-rated.
The action vas taken in the case
Of the FirsAhs, National bank Of Hal
stad. MinnesotH, against the state in
tor and. the certification to the SUI
preme court is: made by stipulation
with the attorney general.
as. Facts of Case.
In an action brought in Burleigh
county by the. First National bank OF
Ealstead, Mimi, the issuance of a writ
"a ID GSNSu W CO1kIPcl NlllC
insurance commissioner, Mr.. A. S.
Olsness, and the state auditor, D.. c.
Po1ndexter, to issue a warrant for the
amount of the adjusted loss to the
| holder Of the mortgage of a certain
crop of wheat on a Renville county
farm.
The question. hinges uponssection 20
of the state hail insurance law of
North Dakota. The section provides
that:
In case OF any diverse ownership
of interest of any crop upon which
damages are allowed, proof in the per-
ccntage of interest in the award shall
be made to the. commissioner of in
surance by affidavit or other showing
under which such rules and regula-
tons as tf1ej commissioner may pro-
vide, and the. award shall be disbursed
to the owner of the land, tenant or
different claimants as their interest
may appear or by a, joint warrant
The question of whether the holder
of a mortgage had an interest in the
crop appeared early in the adjustment
of losses and in answer to a request
from the hail insurance department
on September 81, 1920. i. B. Cox. at
that time assistant attorney general
under VIM. LANCER, after discussing
the claims made by mortgage. holders
VI k"S NV " 'SSlAoit ~
said:
! No Merit in Contention.
Upon due consideration 1 am OF the
opinion that there is no merit in this
contention. Neither crop mortgages OF
liens before foreclosure create in the
| holder thereof an ownership Of inter.
est in the crop involved Fas would en-
title said mortgages or lien holders tt
the same rights under the provision:
Of said section 20 as insure to a'bons
fide owner of an actual interest in the
cr0p insured"
In concluding the opinion holds:
I'm conclusion I will advise 70,
that it Is the opinion of this depart
ment that the commissioner of insur
ance can neither be compelled undel
existing statutes to recognize thu
claims of mortgages upon crops in
sured in the state hail insurance de
partment, upon which losses hav'
been allowed, or the claim of tn
!, holders Of the lien upon such crops
nor has the commissioner of insur
, ance any discretionary powers will
respect to the recognition Of sucl
claims unless they are presented i,
the form of legal assignments .
II l# ~ p.