Court Opinion

ID: 4897128
Source: CourtListenerOpinion
Date Created: 2021-09-03 00:04:49.617361+00
Date Added: 2024-06-11T08:12:47.249709
License: Public Domain

ON MOTION EOB BEHEABING.
In his motion for rehearing respondent asks for further expression as to the character of the bond to be filed by relator and as to the time at which it is to be filed.
We think the difficulty in determining such questions will be overcome by keeping in mind and following what we have already decided—that only one bond is required, and that the several statutory provisions in question relate to it. The bond must, of course, comply with section one and contain the clause relating to reinsurance. The language of that section, expressing the condition to "pay all its lawful obligations to citizens of this State,” unexplained by anything else in the statute and taken literally, might be held to require payment of all other obligations to such citizens, as well as those arising out of policies or contracts issued by the company. But section three also states this part, of the condition, adding words to those contained in section one, and should, we think, be taken.as explanatory and not contradictory of the latter. Thus viewed the added words of section three serve further to define the kind of obligations meant by section one. It follows that a bond containing everything else required by the statute and expressing the condition in the language of either section is sufficient, since both sections; in this particular, provide for the same thing, and the language of section three, explaining that of section one, would prevent a condition expressed in the language of the latter from being more onerous than required. The further trouble experienced seems to arise out of the language of section three which prohibits the issuing of policies until the bond shall have been filed “during the calendar year” of such issuance. Our holding was that the bond is only required by the statute to be filed before the issuance of the certificate of authority, as a prerequisite» thereto. The difficulty suggested, as we understand it, is that the certificate is not issued on the first of January and does not correspond in duration with the calendar year. We understand that this had merely been a matter of practice with the department prior to 1909, but another statute was passed in that year under which certificates are issued on or about the first of March and continue in force until the same date in the next year. Hence it is urged that there is an interval between the first of January and the first of March which is covered by the certificate of authority, but during which the issuance of policies by the company would not be preceded by a bond “filed during the calendar year” of such issuance, as provided in section three. This law may be literally true; but we think it should be apparent that this statute, like very many others, can not be taken literally at every point without funning it into absurdities. It has an obvious and simple purpose to accomplish and apparent inconsistencies and incongruities in its minor provisions should be so explained as to bring them into harmony with other provisions and with that purpose, which is merely to require a bond to secure *200the payment of obligations on insurance policies and contracts as a condition precedent to doing such business in this State. As the certificate is the evidence of authority, the prescribing of the bond as a prerequisite thereof accomplishes the purpose to make the bond such a condition precedent.
As we said in our originad opinion the words, “during the calendar year,” were probably used because it was assumed that the certificate, in connection with which the bond was to be given, ran during the calendar year, and that the bond would correspond. But are the provisions of section one, in which the purpose of the law is clearly expressed and which we have construed in accordance with respondent’s contention, to require a new bond whenever an annual certificate is to be issued, to be subordinated entirely to those few words of section three? Clearly not. But one bond is required and it takes effect contemporaneously with the taking effect of the certificate to obtain which it is given and continues effective during the life of that certificate, covering the entire year for which the latter is issued. This is the scheme of the statute, as reflected in section one. Section three is intended, not to alter, but to help out that scheme and should he accordingly construed and applied. Nothing more is needed to bring the provisions into harmony and carry out fully the object in view than to understand that, by “calendar year,” the year during which the certificate of authority is to operate was intended, and that those words were used because it was supposed that the certificate ran with the calendar year. This construction is amply justified by a comparison' of the different provisions.

Motion overruled.