Court Opinion

ID: 6547033
Source: CourtListenerOpinion
Date Created: 2022-07-19 22:20:25.147681+00
Date Added: 2024-06-11T15:55:59.784974
License: Public Domain

McCueeoch, J. Appellant is a foreign insurance corporation, and, prior to March 23, 1905, entered this State for the purpose of operating its insurance business herein. It fully complied with the laws of the State, established agencies throughout the State, and continued the operation of its business up to' the above mentioned date, when it ceased to transact business. On that date its manager in the city of New York notified the Auditor of the State of Arkansas in writing that its agents had been instructed “to cease at once from transacting business in the State,” and the Auditor immediately made an indorsement on his records to 'the effect that appellant company had ceased to do business in the State. The General Assembly enacted a statute approved May 13. 1907, known as the Wingo Act, requiring that every foreign corporation, Including .railroad and insurance companies, before doing business in the State, shall file in the office of the Secretary of State a copy of its charter or articles of incorporation,, etc.; together '■ with a statement of its assets, liabilities, capital stock, etc., and a certificate designating its place of business in the State and an agent upon whom process may be served. The third section of the act also provides that “all corporations hereáfter incorporated in this State and all foreign corporations seeking to do business in this State shall pay into the treasury of this State for the filing of articles a fee of $25 where the capital stock is $50,000 or under; '$75 where the capital stock is over $50,000 and not more than $100,000; and $25 additional for each $100,000 of capital stock.” Subsequently, appellant company made tender to the Secretary of State of compliance with all the provisions of the WingO' Act, except that of payment of the fee, and claimed the right to resume business in the State without paying the fee. This-claim was denied by the Secretary .of State, and this action was. instituted in the circiut court of Pulaski County to compel hiih, by' mandamus, to accept and' file the copy of charter and certificates, etc., tendered to 'him by appellant, without requiring payment of said fee, and to issue to appellant a certificate thereof. ■The position assumed by appellant’s counsel in support of the claim that their client’s exemption from payment of the fee is, (1) that a foreign corporation which was admitted into the State prior to the passage of the Wingo Act, and whose domestic rights have not been legally terminated, cannot be required to pay the prescribed fee; and (2) that appellant’s corporate rights and legal existence in the State had never been terminated, but that its legal existence in the State was still preserved. We do not deem it necessary to express an opinion as to the first contention of counsel, for we have reached the conclusion that appellant had, prior to the passage of the Wingo Act, voluntarily withdrawn from the State, relinquished whatever domestic rights it possessed, so far as its right to transact business was concerned, and that, in order to come into the-State again for the purpose of doing .business, it is amenable to all the requirements of the new statute, including payment of the prescribed fee. It is argued by counsel with much earnestness that there is a difference between suspension of active business operations in the State by a foreign corporation, and the complete extinction of its legal existence here. This difference is, we think, more theoretical than real, for a foreign corporation is admitted into the State only to transact business. Art. 12, §11, Const. 1874. It does not by such admission become a domestic corporation, nor acquire a permanent domicil in the State like a domestic corporation. 19 Cyc. p. 1206; Liverpool Ins. Co. v. Board of Assessors, 44 La. Ann. 760; St. Louis & S. F. Ry. Co. v. James, 161 U. S. 545; Wilson v. Ry. Co. 64 S. C. 162. It has no other tangible existence except in the maintenance of its place of business and the transaction of business, and when it ceases to perform those functions it has ceased to exist in the State. In this respect it is easily distinguishable from a domestic corporation, and the same rules for determining its continued existence do not apply. We do not mean to say that a mere temporary cessation of business would necessarily operate as a complete withdrawal from the State, but we hold that where a foreign corporation ceases definitely to maintain its place or places of business and its agents in the State and to transact business here, its legal existence here is terminated. Moreover, there are certain annual duties required of foreign insurance corporations by the statutes of this State in order to continue their legal existence in the State after having been duly admitted, which appellant failed to do. These statutes were in force when appellant originally came into the State, and it is not contended that it has complied with them after it ceased to do business in 1905. These omissions of annual duties are set forth in the agreed statement of facts, as follows: “(b) That it did not transmit to the Auditor of State the statement required by section 4337 of Kirby’s Digest. “(c) That it did not file with the Auditor of State the statement required by section 4338 of Kirby’s Digest, and did not pay into the State treasury the tax therein stipulated on its net receipts except for the year 1905. “(d) That it did not give the bond required by section 4339 of Kirby’s Digest. “(e) That it did not certify to the Auditor of State the names of agents appointed by it to solicit risks and insurance policies or receive applications therefor as required by section 4363 of Kirby’s Digest.” These omissions manifest, in the most unequivocal manner, an intention to ■ completely withdraw from the State and from reach of its laws. We are again met with the argument that these statutory requirements relate only to the transacting of business in the State, and not to the right of continued existence in the State — ■ that, notwithstanding the failure of appellant to comply with the law and its discontinuance of business in the State, it maintained an opaque existence here which preserved its right to resume active operations at any time, with immunity from payment of an entrance fee. We do not, however, concur in this view, for, as already shown, when the foreign corporation wholly withdraws its business from the State and ceases to do business and ceases to comply with the laws of the State with reference thereto, it withdraws itself from the State and loses its legal identity here except in so far as the statute restrains its departure while outstanding contracts made here remain unperformed. The circuit court was right in refusing to issue the writ of mandamus, and his judgment is, therefore, affirmed.