American Fidelity Co. v. Bleakley

Sherwin, J.- — Tbe American Fidelity Company is a foreign corporation, organized under the laws of the state of Yermont, and holds a license to transact business in this [443] state in accordance with the laws thereof. It has the power under its charter, by-laws, and the laws of Vermont to insure persons against loss and damage from all kinds of accidents, including the power and authority to insure drivers of automobiles against liability for damages to the persons and property of other persons resulting from accidents caused by the driver’s negligence in operating his machine. In September, 1911, the said company entered into a contract of insurance with one W. F. Gabrio, a citizen and resident of Des Moines, insuring and agreeing to indemnify him as the owner and driver of a certain automobile “against loss from liability imposed by law for damages and expenses incurred on account of bodily injuries, including death resulting therefrom, accidentally suffered by any person or persons by reason of the maintenance, use, loading and unloading of” said automobile, and against loss “from the liability imposed by law on the insured for damages to property, and resulting from any accident caused directly by” said automobile. A few days later this policy of insurance was submitted to the defendant as auditor of the state for his examination and approval. Defendant refused to approve the policy, and ordered its cancellation under threat of expulsion of the plaintiff from the state. Thereafter this action was 'brought in equity, asking that the policy be declared legal under the laws of the state, and that the defendant and those acting under his authority be enjoined from interfering in any way with plaintiff’s right to write such insurance, and from revoking plaintiff’s license to do business in the state because of the issuance of said policy. A writ of mandamus was also asked, compelling the defendant to approve said policy. A demurrer to the petition was sustained, and, the plaintiff electing to stand on its petition, the action was dismissed, and. plaintiff appeals. [444] indemnity' against automobile accidents: legality. [443] The sole question for our determination is thus stated by appellant’s counsel: “May a foreign insurance com [444] pany, which, has complied with all of the provisions of the statutes of Iowa relative to its admission to this state, and has received a license from . . the state auditor to do business within the state, having power by the laws of its own state and by its charter to insure the owner or driver of an automobile, who ■ is not an employer, against liability for damages to persons resulting from an accident caused by the owner’s or driver’s negligence in operating his machine, issue such insurance in Iowa?” In support of appellant’s contention that an affirmative answer should be made to this question, reliance is placed on the following propositions: First, that such insurance is authorized by the first clause of subdivision S of section 1709 of the Code; second, that such insurance is authorized by the second or “employer’s liability” clause of subdivision 5 of the same section; and, third, that such insurance may be issued in this state under the doctrine of interstate comity, appellant having the power under its charter to issue such insurance and being licensed to do business in this state. These propositions will be considered in the order of their statement. The first clause of subdivision 5 of section 1709; as it appears in the Supplement of 1907, provides that any company authorized to do business in this state “may insure the health of persons and against personal injuries, disablement or death resulting from traveling or general accidents by land or water,” and the second clause of subdivision 5 of the section provides that any company may “insure employers against loss in consequence of accidents or casualties of any kind to employees or other persons or to property resulting from any act of an employee, or any accident or casualty of any kind to persons or property, or both, occurring in or connected with the transaction of their business, or from the operation of any machinery connected therewith.” In our judgment the first of these two clauses can not. [445] be so construed as to furnish authority for the issuance of the policy in question. It is true that it authorizes the insurance of persons “against personal injuries, disablement or death,” and that any person may be so insured. But it is clear to us that such insurance is limited hy the terms of the clause and by the chapter generally to personal injuries that are received by the insured himself. It authorizes insurance against accidents, but only against accidents that result in personal injury to the insured. We are aware of the fact that these limitations are not made by the express language of the clause, but we think a fair construction of the language used leads inevitably to the conclusion we reach. The policy sought to be issued by the appellant is one to indemnify the insured against liability that may he imposed by law for some negligent or wrongful act of his own. In other words, its purpose is to insure against a liability that might follow the insured’s negligence, other than as an employer. There is a very decided difference between accident and liability insurance, and we think a clear distinction between the two classes was made by the Legislature in enacting subdivision 5 of section 1709. The second clause provides for liability insurance, but limits it to employers. If the appellant’s construction of the first clause were to obtain, it is manifest that the second clause would be useless, for the first clause would alone completely cover the ground, and, liability insurance having been provided for in the second clause, the statute is to be construed as prohibiting liability insurance not therein authorized. 36 Cyc. 1122. The second clause of subdivision 5 does not in our opinion furnish the appellant any authority for its contention. It plainly and clearly provides for indemnity to an employer, and to an employer only. It provides that he may insure himself against liability arising from the act of his employee, but nothing more. [446] 2. Same- foreign panl^fTnte”" state comity. The appellant’s claim that the policy in question should issue because of interstate comity can not be sustained. The state has the undoubted right to say whether foreign corporations shall be permitted to do busi31688 here at all, and, if such permission is granted, it may be upon such terms and conditions as the state shall prescribe. And, where it is the manifest intention to limit or restrict the powers given to such corporation by its charter, courts have no authority to override such legislation on the ground of comity between the states. Within its power, the state, through its Legislature, is supreme, and the court’s duty is ended when it determines what the statutory law is. The Attorney-General urges that it would be against public policy to permit such insurance as the appellant proposes. If it is meant that it would contravene the declared policy of the state, we fully agree with the contention. But, if it is contended that sound, undeclared public policy demands a denial of such policies of insurance, we can not agree to the proposition. Out of the nearly 50,000 drivers of automobiles in this state there may be a few who are so careless and heedless about the lives and limbs of their neighbors as to be unworthy of any kind of protection. On the other hand, accidents may happen to the other large class of drivers, the men who are law abiding, and who are careful not to injure even a stray dog or an old hen that persists either in crossing the road just ahead of the car or under it, and this great majority of decent drivers should not be denied reasonable protection because of the recklessness of a few. As we have said, however, we think this insurance is not permitted under the present statute, and the judgment must, therefore be — Affirmed.