Hooper v. California
155 U.S. 648 (1895)

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U.S. Supreme Court

Hooper v. California, 155 U.S. 648 (1895)

Hooper v. California

No. 7

Argued October 10, 1894

Decided January 7, 1895

155 U.S. 648

Syllabus

Section 439 of the Penal Code of California, making it a misdemeanor for a person in that state to procure insurance for a resident in the state from an insurance company not incorporated under its laws and which had not filed the bond required by the laws of the state relative to insurance, is not a regulation of commerce and does not conflict with the Constitution of the United States when enforced against the agent of a New York firm in California who, through his principals and by telegram, procured for a resident in California applying for it there marine insurance on an ocean steamer from an insurance company incorporated under the laws of Massachusetts, and which had not filed the bond required by the laws of California.

Section 623 of the Political Code of the State of California provides as follows:

"The [insurance] commissioner must require every company, association, or individual not incorporated under the laws of this state and proposing to transact insurance business by agent or agents in this state, before commencing such business to file in his office a bond to be signed by the person or firm, officer or agent, as principal, with two sureties to be approved by the commissioner, in the penal sum of two thousand dollars for each insurance company, association, firm or individual for whose account it is proposed to collect premiums of insurance in this state."

"The condition of such bond to be as follows:"

"1. That the person or firm, agent or officer named therein, acting on behalf of the company, association, firm or individual, named therein, will pay to the treasurer of the county, or city and county in which the principal office of the agency is located such sum per quarter, quarterly in advance, for a license to transact an insurance business or such other license

Page 155 U. S. 649

as may be imposed by law as long as the agency remains in the hands of the person or firm, agent or officer named as principal in the bond."

"2.. That the person or firm, officer or agent will pay to the state all stamp or other duties on the gross amounts insured inclusive of renewals on existing policies."

"3.. That the person, firm, agent or corporation named therein will conform to all provisions of the revenue or other laws made to govern them."

Section 439 of the Penal Code of California is as follows:

"Every person who in this state procures or agrees to procure any insurance for a resident of this state from any insurance company not incorporated under the laws of this state, unless such company or its agent has filed the bond required by the laws of this state relative to insurance, is guilty of a misdemeanor."

On the 29th day of September, 1888, the plaintiff in error was charged before a police court of the City and County of San Francisco with having, on the first day of April, 1888, "in the City and County of San Francisco," committed the misdemeanor of procuring insurance on account of foreign companies that have not complied with the laws of this state; with having

"then and there procured for a resident of this state insurance from an insurance company not incorporated under the laws of this state, to-wit, China Mutual Insurance Company of Boston, said company or its agents not then or there having filed the bond required by the laws of this state relative to insurance."

A jury having been waived, the case was tried by the court, and the defendant, having been found guilty, was sentenced to pay a fine of $5, and, in default thereof, to be imprisoned in the city prison for twenty-four hours. Motions in arrest and for a new trial were made on several grounds, among which it is necessary only to state the following:

"Second. For that the statute, to-wit, sec. 439 of the Penal Code of the State of California, amounts to and is a regulation of commerce between the several states and foreign

Page 155 U. S. 650

nations, and is therefore in violation of paragraph 3, sec. 8, of article 1 of the Constitution of the United States."

"Third. For that sec. 439 of the Penal Code of the State of California is in violation of the constitutional right of the defendant to transact any business in the State of California which is not opposed to the good morals or health of the community."

"Fourth. That the said statute is not a police regulation."

"Fifth. For that said statute is in violation of the Fourteenth Amendment."

The motions having been overruled, the cause was taken by appeal to the superior court of the City and County of San Francisco, the highest court to which an appeal was permissible under the Constitution and laws of the State of California.

The facts were stated as follows:

"That the firm of Johnson & Higgins are average adjusters and insurance brokers, residing and having their principal place of business in the City of New York, State of New York."

"That as insurance brokers, they procure for other persons, of whatever state resident, and on the request of such persons, insurance on ships and vessels, cargoes and freights, from insurance companies not incorporated under the laws of the State of California or doing business therein as provided by the laws of said state."

"That they receive from said companies the marine policies issued by said companies so insuring said ships or vessels, and deliver them to the party or parties for whom they have procured the same."

"That the said firm of Johnson & Higgins at all the times herein mentioned, had a place of business in the City and County of San Francisco, State of California, and that the defendant had at all the times herein mentioned charge of said business as the employee and agent of said Johnson & Higgins, and not otherwise."

"That on the 13th day of March, 1888, C. W. Mott, a resident of the State of California, inquired of said defendant

Page 155 U. S. 651

if he, the said defendant, as the agent of Johnson & Higgins, could procure the said Johnson & Higgins to place a certain amount of insurance on the steamer Alliance of San Francisco at a certain named rate of premium; to which said defendant replied he would see what could be done in respect to the same."

"That thereupon the said defendant informed Johnson & Higgins of the inquiry of said Mott, and requested them to advise him, the said defendant, of what, if anything, they had done or could do in the premises; that in compliance with the said request of the said defendant, said Johnson & Higgins telegraphed to said defendant as follows: 'Alliance, four thousand dollars, done in American form,' but did not advise said defendant of the name of the company in which said insurance had been placed."

"The contents of the telegram above named were communicated by the defendant to said Mott. In April, 1888, said firm of Johnson & Higgins forwarded to the said defendant the policy of the 'China Mutual Insurance Company,' insuring four thousand dollars on said steamer Alliance."

"Said insurance company not then and there being a company incorporated under the laws of the State of California, and not then and there having by itself or its agent filed the bond required by the laws of the said State of California relating to insurance, this policy was delivered by the defendant to said Mott, and thereupon said Mott paid to the said defendant, as agent of Johnson & Higgins, the premium for said insurance. This premium was deposited by the defendant in a bank in San Francisco to the credit of Johnson & Higgins, and Johnson & Higgins were duly advised by him that said premium had been collected, and the amount deposited in the bank to their credit."

"All the said verbal acts by said Mott and also of said defendant, and all acts of defendant as agent in said procuring, were done in the City and County of San Francisco, State of California."

On the foregoing statement, the judgment below was affirmed upon the ground

"that the facts, as they appear

Page 155 U. S. 652

of record herein, bring the act of defendant within the true intent and meaning of section 439 of the Penal Code of the State of California,"

and that "on the facts in this case, said act is not repugnant to any of the provisions of the Constitution of the United States."

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