§ 130. Construction-When Retaliatory Provision Becomes Operative.-The contingency contemplated by such statutes arises when the laws of the foreign State provide for imposition of the tax, license fee, etc., and the retaliatory law goes into effect at once. It is not necessary that payment should have been actually exacted from some corporation of the retaliating State,' nor even that any of its corporations should be at that time doing business in the foreign State."

§ 131.

Same-Strict Construction-General Rule -When the Effect of the Foreign Statute is Doubtful.

-There can be no doubt that the proper general rule of interpretation of such legislation requires a strict construction, confining its operation to the limits expressed in its terms. Such enactmentsare in derogation of the general policy and law of comity prevailing in all the States, which allows foreign corporations to engage in business in their respective jurisdictions, and a particular company or class of companies should not, as a merely retaliatory measure, be excluded from doing so by a judgment of ouster unless it is clearly apparent that the case is within the scope of the retaliatory statute. So where a New York statute provided

1 Phoenix Ins. Co. v. Welch, 29 Kan. 672; State v. Fidelity, etc. Ins. Co., 77 Iowa, 648, 42 N. W. Rep. 509; State v. Fidelity, etc. Co. (Ohio), 31 N. E. Rep. 658.

2 Germania Ins. Co. v. Swigert, 138 Ill. 237, 21 N. E. Rep. 530. In so construing the statute in this case the court calls attention to the fact, that no provision is made by its terms whereby the State auditor can inform himself as to whether insurance companies organized under the laws of the State have or have not agencies in any particular foreign State. He cannot leave his office to make inquiries; no provision is made for a messenger, and he is not authorized to rely upon the reports of officers of the foreign State. See also State v. Reinmund, 45 Ohio St. 214, 13 N. E. Rep. 30.

3 State v. Fidelity, etc. Ins. Co., 39 Minn. 538, 41 N. W. Rep. 108; Griesa v. Massachusetts Ben. Co., 15 N. Y. Supp. 71.

that "no company organized under this act" shall, etc., engage in more than one of the several kinds of risks specified, and it appeared doubtful what effect would be given to such legislation in that State, the Minnesota court in a quo warranto proceeding held that, in the absence of judicial construction of the provision by the courts of New York, it would not exclude a New York corporation organized before the enactment of the New York statute in question from doing business in Minnesota, although it might be of the opinion that the probable effect of such legislation was to restrict the operations of foreign corporations in New York to a narrower field than that allowed in Minnesota to the respondent.'

§ 132. Same-In New York-Distinction between "Obligations" and "Prohibitions."-The New York retaliatory statute provides that where any other State shall impose any "obligations" upon corporations of this State doing business in such other State, "the like obligations are hereby imposed on similar corporations of such other States transacting business in this State."" Upon a question as to the validity of insurance effected by a Massachusetts assessment company in New York upon the life of a woman sixty-two years of age, it was urged that under the above retaliatory law, the statute of Massachusetts providing that "no corporation doing business under this act shall issue a certificate or policy upon the life of any person more than sixty years of age, must be considered as in force in New York as to Massachusetts companies. The New York Supreme Court, however, held otherwise

1 State v. Fidelity, etc. Ins. Co., 39 Minn. 538, 41 N. W. Rep. 108.

2 Acts N. Y. 1883, ch. 175.

3 Acts Mass. 1885, ch. 183, § 10.

upon the theory that the retaliatory statute must be strictly construed, and that in imposing "like obligations" upon foreign companies the term "obligation" cannot be held to include a prohibition or limitation upon the powers of the corporations referred to."

§ 133. Same-Duties of State Officers.-Another argument in favor of a strict construction of such statutes is that their precise and ultimate effect cannot be foreseen at the time they are passed. The statutes of the foreign jurisdiction which they declare shall become a part of the State may not be yet enacted. And if already on the statute book they may be radically different in policy and theory, from the rest of the legislation on that subject, of the State by which they are adopted. Thus, in Maryland, where the insurance commissioner has no discretionary power to exclude a foreign company from the State, it was held, under a retaliatory law which provided that when, under the laws of any other State, any "taxes, fines or penalties, or other obligations or prohibitions are imposed upon insurance companies," incorporated under the law of Maryland, "greater than those imposed by the laws of this State," the same shall be enforced upon "companies of such State doing business in this

1 Griesa v. Massachusetts Ben. Assn. 15 N. Y. Supp. 71. While this is probably a correct interpretation of the New York statute, on principle the power of the Massachusetts company to make a contract in New York, which it was incapacitated to make in Massachusetts, not because of a general rule of property, but because the legislature of that State, which created it, has withheld the power, may well be doubted. Such a statute controlling, limiting, fixing the powers of assessment insurance companies generally, both foreign and domestic, within the State, may well be regarded as a part of the charter of the companies organized under the statute, and that it therefore goes with them and limits their action in the foreign jurisdiction. See ante, § 9 and post, § 137.

State, instead of those prescribed by the laws of this State," had the effect to put into operation in Maryland the New York statute, giving the insurance commissioner, or as he is called in that State "the superintendent of insurance," authority to refuse a foreign corporation power to transact the business of insurance in the State, "whenever the capital stock shall be impaired and also whenever in his judgment such refusal to admit shall promote the best interests of the people of this State." And under this transplanted statute the court sustained the discretionary exclusion by the Maryland commissioner of insurance of an otherwise unexceptionable New York corporation, it being shown that a similar Maryland company had been arbitrarily excluded from the State of New York by the superintendent of insurance. But in Indiana, where the statute provides for the payment of taxes, etc., by foreign insurance companies to the State auditor," it was held that the retaliatory statute' would not put in force the New York law, by which foreign companies are required to pay taxes to the treasurer of the fire department of each city or to the city treasurer, so as to enable such municipal officers in Indiana to maintain an action for such tax is against a New York corporation doing business in that State.'

§ 134. Same-"Substantially the Same Basis and Limitations."-Legislation of this kind affords an apt illustration of need for precision and skill in

1 Talbott v. Fidelity, etc. Co. (Md., June 18, 1891), 22 N. E. Rep. 395. See also State v. Moore, 39 Ohio St. 486.

2 Acts Ind. 1873, p. 205, § 8.

Rev. St. Ind. 1881, § 3773.

Blackmer v. Royal Ins. Co., 115 Ind. 291, 17 N. E. Rep. 580.

drafting statutes; for if the language used in the retaliatory statute is general and inexact, just in that proportion will the effect of the legislation, which it adopts, be uncertain and indeterminate. Thus, the Ohio law provides that certificates of authority to do business shall not be granted to any assessment insurance company organized in any State in which such Ohio corporations "are not permitted to do business on subtantially the same basis and limitations as they are in Ohio."" The "basis and limitations" on which such assessment companies may do business in Ohio, without complying with the laws regulating mutual life insurance companies, are briefly: (1) that their policies must be for the relief of members and for the payment of money to the families or heirs of deceased members, (2) that the agreement to pay any fixed amounts under their policies, whether as endowments or death losses, shall be conditional upon the same being realized from assessments, and (3) that no policy shall be issued for a greater amount than the company shall be able to pay from the proceeds of one assessment.* In a quo warranto proceeding against a Michigan corporation it was shown that under the law of that State every policy issued by such a company must specify the amount it promised to pay and upon the happening of the contingency that the full amount should be due; that no foreign assessment company was entitled to a certificate of authority to do business in the State, unless it had in force policies upon which one assessment would pay the

1 Rev. St. Ohio, § 3630e.

2 Id. §§ 3630, 3630c.