Court Opinion

ID: 8295310
Source: CourtListenerOpinion
Date Created: 2022-10-17 11:01:33.218845+00
Date Added: 2024-06-11T16:44:01.682533
License: Public Domain

Justice PLEICONES.
I respectfully dissent and would affirm the decision of the Court of Appeals. First, the statutes and case law are clear: the exclusive method for service of process on a foreign insurance company is by service on the Director of the Department of Insurance. Pursuant to S.C.Code Ann. § 38-5-70 (2002), every foreign insurer appoints the director as its agent *13for service of process. Substituted service upon the director “is [the] exclusive [method], and service made in any other way upon such corporations is invalid.” Murray v. Sovereign Camp, W.O.W., 192 S.C. 101, 108, 5 S.E.2d 560, 562 (1939) (construing predecessor to § 38-5-70). Further, S.C.Code Ann. § 15-9-270 (2005) provides, “The summons and any other legal process in any action or proceeding against [an insurance company] must be served on an insurance company ... by delivering two copies ... to the Director ...” Compliance with this statute “is the proper and exclusive method of obtaining jurisdiction over the insurance company.” Equilease Corp. v. Weathers, 275 S.C. 478, 484, 272 S.E.2d 789, 792 (1980). An action is not commenced unless these statutory mandates are met, and all parties agree they were not complied with here. See also Couch on Insurance § 3:30 (3rd ed.2013) (recognizing South Carolina as a jurisdiction where service on statutory agent is exclusive). The trial court erred in refusing to set aside entry of default.
I also agree with the Court of Appeals that the policy underlying these statutes is to protect the public by informing the Director of allegations of insurer misconduct. See S.C.Code Ann. § 38-3-110(2002). I therefore conclude it would violate public policy to permit an insurance company to contract out of these mandatory substituted service statutes.
While it is unfortunate that an insurance company that received actual notice of the petitioners’ suit is taking advantage of these substituted service statutes, this result is compelled by our precedents and by the public policy that the statutes serve. For the reasons given above, I would affirm the decision of the Court of Appeals.