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Statement of the Case.



No. 26. Argued and submitted March 7, 1901.-Decided October 21, 1901.

Knoxville Iron Company v. IIarbison, ante 13, followed.

This was an action tried in the circuit court of Rhea County, Tennessee, wherein T. A. Barton, a citizen of Tennessee, sought to recover from the Dayton Coal and Iron Company (Limited), a corporation organized under the laws of Great Britain, and doing business as manufacturer of pig iron and coke in said county. The company owns a store where it sells goods to its employés and other persons. The company also has a monthly pay day, and settles in cash with its employés on said pay day. In the mean time, and to such of its employés as see fit to request the same, it issues orders on its storekeeper for goods.

On March 17, 1899, the legislature of Tennessee passed an act requiring “all persons, firms, corporations and companies, using coupons, serip, punchout, store orders, or other evidences of indebtedness to pay laborers and employés for labor or otherwise, to redeem the same in good and lawful money of the United States in the hands of their employés, laborers, or a bona fide holder, and to provide a legal remedy for collection of same in favor of said laborers, employés and such bona fide holders."

This was a suit brought by said Barton to recover as a bona fide holder of certain store orders that had been issued by the defendant company to some of its laborers in payment for labor. The defendant company denied the validity of the legislation, as well under the laws and constitution of Tennessee as the Fourteenth Amendment of the Constitution of the United States. The plaintiff recovered a judgment against the company in the circuit court of Rhea County, and this judgment was affirmed by the Supreme Court of Tennessee, whereupon a writ of error from this court was allowed by the Chief Justice of the state Supreme Court.

Opinion of the Court.

Mr. Frederick Lee Mansfield for the Dayton Coal and Iron Company.

Mr. Benjamin Gorden McKenzie for Barton.

MR. JUSTICE SHIRAs, after making the above statement, delivered the opinion of the court.

The only question presented for our consideration in this record is the validity, under the Fourteenth Amendment of the Constitution of the United States, of the act of the legislature of the State of Tennessee, prescribing that corporations and other persons, issuing store orders in payment for labor shall redeem them in cash, and providing a legal remedy for bona fide holders of such orders.

In the case of The Knoxville Iron Company v. Samuel Harbison, in error to the Supreme Court of Tennessee, decided at the present term, we affirmed the judgment of that court sustaining the constitutional validity of the state legislation in question, and the cause now before us is sufficiently disposed of by a reference to that case.

The only difference in the cases is, that in the former the plaintiff in error was a domestic corporation of the State of Tennessee, while, in the present, the plaintiff in error is a foreign corporation. If that fact can be considered as a ground for a different conclusion, it would not help the present plaintiff in error, whose right, as a foreign corporation, to carry on business in the State of Tennessee, might be deemed subject to the condition of obeying the regulations prescribed in the legislation of the State. As was said in Orient Insurance Co. v. Daggs, 172 U. S. 557, 566, that “which a State may do with corporations of its own creation it may do with foreign corporations admitted into the State. . . The power of a State to impose conditions upon foreign corporations is certainly as extensive as the power over domestic corporations, and is fully explained in Hooper v. California, 155 U. S. 648.”

We do not care, however, to put our present decision upon the fact that the plaintiff in error is a foreign corporation, nor


to be understood to intimate that state legislation, invalid as
contrary to the Constitution of the United States, can be im-
posed as a condition upon the right of such a corporation to do
business within the State. Home Ins. Co. v. Morse, 20 Wall.
445; Blake v. McClung, 172 U. S. 239, 254.
The judgment of the Supreme Court of Tennessee is







No. 29. Argued March 18, 1901. - Decided October 28, 1901.

The policies sued on provided for forfeiture on nonpayment of premiums,

and as to payments subsequent to the first, which were payable in advance, for a grace of one month, the unpaid premiums to bear interest and to be deducted from the amount of the insurance if death ensued during the month. The applications, which were part of the policies, were dated December 12, 1893, and by them Mc Master applied, in the customary way, for insurance on the ordinary life table, the premiums to be paid annually; the company assented and fixed the annual premium at $21, on payment of which, and not before, the policies were to go into effect. After the applications were filled out and signed, and without McMaster's knowledge or assent, the company's agent inserted therein: “Please date policy same as application;' the policies were issued and dated December 18, 1893, and recited that their pecuniary consideration was the payment in advance of the first annual premiums, " and of the payment of a like sum on the twelfth day of December in every year thereafter during the continuance of this policy.” They were tendered to McMaster by the company's agent, December 26, 1893, but McMaster's attention was not called to the terms of this provision, and on the contrary he " asked the agent if the policies were as represented, and if they would insure him for the period of thirteen months, to which the agent replied that they did so insure him and thereupon McMaster paid the agent the full first annual premium or the sum of twenty-one

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Statement of the Case.

dollars on each policy and without reading the policies he received them and placed them away." McMaster died January 18, 1895, not having paid any further premiums, and the company defended on the ground that the policies became forfeited January 12, 1895, being twelve months from December 12, 1893, with the month of grace added. Held that, (1) The statutes of Iowa where the insurance was solicited, the appli

cations signed, the premiums paid and the policies delivered, gov

ern the relation of the solicitor to the parties. (2) Under the circumstances plaintiff was not estopped to deny that

McMaster requested that the policies should be in force December 12, 1893, or, by accepting the policies, agreed that the insurance might be forfeited within thirteen months from December 12,

(3) The rule in respect of forfeiture that if policies of insurance are

so framed as to be fairly open to construction that view should be adopted, if possible, which will sustain rather than forfeit the con

tract is applicable. (4) Tested by that rule these policies were not in force earlier than

December 18, 1893, and as the annual premiums had been paid up to December 18, 1894, forfeiture could not be insisted on for any part of that year or of the month of grace also secured by the contracts.

This was an action brought by Fred A. McMaster, administrator of the estate of Frank E. McMaster, deceased, against the New York Life Insurance Company on five policies of insurance of one thousand dollars each upon the life of Frank E. McMaster..

The applications were dated December 12, and the policies December 18, 1893. The premiums for a year in advance were paid, and the policies delivered December 26, 1893.

McMaster died January 18, 1895, and the defence was that the insurance had been forfeited by failure in payment of the second annual premiums on or before January 12, 1895, that is to say, within thirty days after December 12, 1894, when the company contended they became due.

The company alleged in a substituted and amended answer that the policies were executed and delivered December 12, 1893, and set forth:

“2. This defendant, for further answer, says that said application is dated the 12th day of December, 1893, and asked the issuing of five policies of $1000 each upon the life of the said

Statement of the Case.

Frank E. McMaster, deceased. Said application also contained a request that said five policies each should be issued, dated and take effect the same date as the application, namely, the 12th day of December, 1893, and said request was complied with, and the policies were so issued.

“This defendant grants to the insured in said defendant company a grace of one month on the payment of premiums, which extended the day of payment of premiums from December 12th, 1894, as in the policies issued to said Frank E. McMaster, deceased, late as the 12th day of January, 1895, but not later.

“3. This defendant, for further answer, says that payment of the premiums due upon said policies were not paid within the time prescribed as aforesaid, and that said Frank E. McMaster died on the 18th day of January, 1895, six days after said policies had lapsed and were forfeited for non-payment of premiums as required.


“6. This defendant, further answering said petition, says that said application is a part of said policies, in each case, that said assured received and accepted said policies during his lifetime and had them all in his possession for a long time, and was aware and knew, or could have known, the contents in each policy.

“That said assured had paid the premiums when sạid policies were delivered to him; that by reason of said assured's acceptance of said policies, his representative, the plaintiff herein, is estopped from denying the date of said policies or claiming that said policies should have a different date from the application, and is estopped for the reasons above stated from claiming that said words, to wit: 'Please date policy same as application’ were not in said application when insured signed same, for by accepting said policies the assured waived said right to object, if said words were inserted, as alleged in petition after the signing of the application, which this defendant denies.”

The case was tried by the Circuit Court without a jury; special findings of fact made; and judgment rendered in favor of defendant. 90 Fed. Rep. 40.

Plaintiff prosecuted a writ of error from the Circuit Court of

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