Court Opinion

ID: 7810031
Source: CourtListenerOpinion
Date Created: 2022-09-07 17:11:48.836211+00
Date Added: 2024-06-11T16:30:26.365344
License: Public Domain

HART, J., (on rehearing). It is earnestly insisted by counsel in their brief on the motion for a rehearing that the opinion is in conflict with the case of Schiele v. Dillard, 94 Ark. 277, and other cases of like character which hold that, while the court may in its discretion allow additional parties plaintiff or defendant to be added, it can not make an entire change of parties, as that would be tantamount to a new suit between different parties. When the suit was first commenced, it was alleged in the complaint that the defendant was a corporation. It turned out that such was not the fact, but that it was a voluntary unincorporated ’ association. The plaintiff asked permission to amend, and it is now insisted that the effect of such an amendment to the complaint would be to overrule the decisions referred to above. We do not think so. The plaintiff in his original complaint made a misnomer of the defendant. The only effect of the amendment would be to correct that mistake, and process should then be issued and directed to the defendant in its correct name. Of course, this process would then be served upon the defendant and form a new point for the commencement of the suit against it. Therefore, in our original opinion, we proceeded at once to what we considered the real issue in the case, and that was whether or not the statute in express terms, or by necessary implication, prescribes that in suits of this sort the association may sue or be sued in its associated name. While the statute does not prescribe in express terms that suits shall be prosecuted for and against the association in its associated name, it does do so by necessary implication. Section two provides the name of the office at which indemnity contracts shall be issued, and that the name shall not be similar to any other name previously adopted by similar organizations. It provides for the officer who shall execute such contracts in behalf of the association. It further provides that there shall also be filed with the insurance commissioner a copy of the form of policy by which such insurance is about to be effected or exchanged. Section four provides that the attorney for the association shall file with the insurance commissioner an instrument in writing executed by him for the subscribers, conditioned that upon the issuance of a certificate of authority to do business in the State service of process may be had upon the insurance commissioner in all suits in this State arising out of such policies. It would be a vain and useless thing to make a.11 these provisions in the statute unless the Legislature intended that the corporation should sue or be sued in its associated name. If it had been intended that the association should be governed by the common law rule regulating voluntary unincorporated associations, there would have been no necessity for the provision of a name and place where the association would issue its contracts nor for that provision providing for service upon the insurance-commissioner in all suits in this State arising out of policies issued by the association. The certificate of insurance sued on was issued in the name of the Manufacturing Wood Workers Underwriters. The association has complied with the statute and has held itself out and conducted its business with subscribers in this State under that name.- This shows that the association in practice put the same construction upon the statute that we have. It is now insisted, that such a construction of the statute renders it unconstitutional, and that it is an infringement upon the freedom to contract which the 14th Amendment of the Constitution of the United States guarantees They rely upon the case of Allgeyer v. Louisiana, 165 U. S. 578. In the case of New York Life Ins. Co. v. Dodge, 246 U. S. 357, the court said: “In Allgeyer v. Louisiana, supra, we held a Louisiana statute invalid which undertook to restrict the right of a citizen while within that State to place insurance upon property located there by contract made and to be performed beyond its borders. We said: ‘The mere fact that a citizen may be within the limits of a particular State does not prevent his making a contract outside its limits while he himself remains within it,’ and ruled that under the 14th Amendment the right to contract outside for insurance on property within a State is one which can not be taken away by State legislation. So to contract is a part of the liberty guaranteed to every citizen. The doctrine of this case has been often reaffirmed, and must be accepted'as established.”  (4) We do not think the principles there announced have any application whatever to the facts of the case at bar. That the State in the exercise of its police power may fully and completely regulate the business of insurance has been repeatedly settled both by decisions of this court and of the Supreme Court of the United States. The principle was recognized by the Supreme Court of the United States in the case last cited. The statute in question does not attempt to forbid or penalize the making of contracts of insurance outside of the State to be performed outside of the State upon property within the State. It only prescribes the conditions under which persons or corporations outside of the State may exchange insurance with persons or corporations within the State, and this was a valid exercise of police power by the Legislature and does not in any wise interfere with their freedom to contract. It only regulátes their method of doing business in the State. It follows that the original opinion will prevail, and the motion for a rehearing will be denied.