Court Opinion

ID: 6280924
Source: CourtListenerOpinion
Date Created: 2022-02-18 16:15:49.403774+00
Date Added: 2024-06-11T09:00:11.748943
License: Public Domain

*409Dissenting Opinion by
Keller, J.:
Tbe importance of this case to tbe holders of policies of mutual insurance constrains me to dissent from tbe opinion of tbe majority and to set forth my reasons therefor at some length.
Tbe Act of June 1, 1911, P. L. 599, authorizes tbe Court of Common Pleas of Dauphin County, for cause shown, to order the liquidation of the business of any domestic insurance corporation, in which case such liquidation shall be made by and under the direction of the insurance commissioner; but the general oversight and direction of the acts of the insurance commissioner as such liquidator are committed to said court which must approve the compensation of the special deputy commissioners, counsel, clerks and assistants employed by him in connection therewith and also all expenses of taking possession of and conducting the liquidation of such corporation (section 4).. The commissioner’s account as such liquidator must also be filed in said court which is to be “preceded” [proceeded] with and passed upon as other accounts are passed upon in said court and the funds in hand are to be distributed as decreed by said court (section 7).
It is apparent from the foregoing that the insurance commissioner, as such liquidator, acts very largely under the control and direction of the Court of Common Pleas of Dauphin County, just as formerly a receiver appointed to liquidate the affairs of an insolvent insurance corporation so acted.
Under the practice in force before the Act of 1911, supra, two kinds of assessments could be levied on policyholders of mutual insurance companies for losses incurred during their membership in such companies: The one was levied by the directors of a going and apparently solvent company, and all that .had to be. set forth in the plaintiff’s statement in a suit to enforce such assessment was an averment that the losses and expenses of the plaintiff company during the time de*410fendant’s policy was in force necessitated tbe assessment, that it was duly made by tbe board of directors on a day named, and that due notice thereof bad been giyen tbe defendant. A verbatim copy of tbe resolution and an itemized statement of tbe losses and expenses necessitating tbe assessment were not required: Sparks v. Flaccus Glass Co., 16 Pa. Superior Ct. 119; Insurance Co. v. Vitale, 10 Pa. Superior Ct. 157; for by section 56 of tbe Act of May 1, 1876, P. L. 53, tbe certificate of assessment in sucb circumstances duly signed by tbe president and attested by tbe secretary is prima facie evidence thereof: Peoples Mutual Fire Insurance Co. v. Groff, 154 Pa. 200. Sucb an assessment might be sued for by either the company or by a receiver appointed after tbe levy.
Tbe other was an assessment levied by tbe receiver of an insolvent company under order of tbe court appointing him. To secure this order tbe receiver set forth in bis petition asking for sucb authority all tbe facts necessary to enable tbe court intelligently to make sucb order, with full details as to tbe unpaid losses, their date of occurrence, tbe policies in force at tbe time and tbe holders liable to contribute thereto, and any other facts necessary to inform a policyholder as to bis liability for tbe assessment to be levied. When an order authorizing sucb assessment was made by tbe court, tbe receiver could sue thereon and in sucb case tbe order of tbe court was conclusive as to tbe validity and tbe amount of tbe assessment: Capital City Mutual Fire Ins. Co. v. Boggs, 172 Pa. 91; Stockley, Receiver, v. Riebenack, 12 Pa. Superior Ct. 169; Stockley, Receiver, v. Hartley, 12 Pa. Superior Ct. 628. But tbe plaintiff’s statement in sucb action bad to include a full copy of tbe record of tbe proceedings leading up to tbe order for assessment: Schofield, Receiver, v. Lafferty, 17 Pa. Superior Ct. 8; and was defective and insufficient unless accompanied by a full copy of sucb record if suit was brought in another *411county: Stockley, Receiver, v. McClurg, 14 Pa. Superior Ct. 629.
In the present case the assessments in suit, notwithstanding the inadvertent statement of the learned court below, were not levied by the insurance company, but by the insurance commissioner as liquidator. We have here neither a certificate of such assessments signed by the president and attested by the secretary of the company, as provided by the Act of 1876, nor any order of the Court of Common Pleas of Dauphin County authorizing them.
In the plaintiff’s amended statement, which must be held to have superseded and taken the place of the original statement (Kay v. Fredrigal, 3 Pa. 221, p. 223; Encyclopedia of Pleading and Practice, vol. 1, p. 625; State v. Simkins, 42 N. W. 516 — Iowa),—for it is not an addition to or amendment of the original statement •but a pleading complete in itself which does not refer to or adopt the original as part of it, — we have no details as to the losses, when they occurred, their amount, the dumber of assessable policies in force at the time and the insurance covered thereby or any data by which the defendant could assure herself that the amount claimed is justly due and owing — nothing but the bare assertion that the insurance commissioner levied certain assessments upon the defendant on the dates noted — no record of the Court of Common Pleas of Dauphin County authorizing such levy.
Speaking for myself, I do not believe that the Act of 1911, supra, gives the insurance commissioner as such liquidator any authority to levy assessments, on policyholders without a petition to and order of the court, which proceedings should be fully set out in the plaintiff’s statement if suit is brought outside of Dauphin County; but if it does, then I hold that in his levy of such assessment the liquidator must set forth in detail sufficient facts to justify the assessment, just as he would be required to do in a petition to the court for *412authority to levy such assessment, or he must aver such facts in his statement as justify his claim against the defendant; in other words, the statement must be self-supporting and not put the defendant to extraneous research to find out if he legally owes the money claimed.
The mutual insurance policyholder may be compelled to pay for losses of which he had no notice, incurred nearly a score of years before and many years after he ceased to be a policyholder, and when other formerly solvent policyholders are dead and their estates settled, so that practically the entire loss may fall on him; providing only suit is brought within six years after the date of the decree authorizing the. assessment: Schofield v. Turner, 213 Pa. 548. It is, therefore, not too much to require of a receiver or liquidator in such a suit that he set forth fully in his statement the facts on which his assessment is based, in other words, “the material facts on which the party pleading relies for his claim”: Act of May 14, 1915, P. L. 483.
Nothing of the kind was done in this case; there was no order of the Court of Common Pleas of Dauphin County, no details of any assessment, no facts averred from which the liability of the defendant could be determined.
I think the statement filed was insufficient and would, therefore, reverse the judgment and direct judgment to be entered for the defendant, unless the plaintiff within fifteen days filed a full, sufficient and self-supporting statement of claim.
Porter, J., concurs in this dissent.