(g) Even if they had vested rights therein it would not be unconstitutional to affect them by legislation.

(h) That the matters alleged in the complaint show that the complinants have violated the act in question.

(i) Whether such acts would be a violation of the actin question is immaterial if the law is constitutional as against them, and that the action of the defendant should not be enjoined thereunder.

Another thought which suggests itself is this: The complainants join in this suit to assert those rights which are common among them, therefore none of the plaintiffs should be permitted to assert or rely upon those which are not common to all of them. One of the complainants named, and perhaps several of those who are not named as complainants but in whose behalf the suit is maintained, is incorporated under the laws of England and not a citizen of the United States in any sense, and the inquiry arises, therefore: Can any of the complainants in this suit be heard to assert rights of United States citizenship? I do not consider that this question is very important or necessary to a decision of the case, and have, therefore, not examined the authorities thereon, and merely suggest it to the Court for what it is worth.

I therefore respectfully submit that the demurrer herein should be sustained.

PHILO HALL,

Attorney General for South Dakota, Defendant's Solicitor.

IN THE CIRCUIT COURT OF THE UNITED STATES WITHIN AND FOR THE DISTRICT OF SOUTH DAKOTA,

SOUTHERN DIVISION.

The Hartford Fire Insurance Company of Connecticut,)

a Corporation; The Phenix Insurance Company of Brooklyn, New York, a Corporation; The Royal Insurance Company of Liverpool, England, a Foreign Corporation; The German-American Fire Insurance Company of New York, a Coporation; The Springfield {IN EQUITY.

Fire and Marine Insurance Company of Massachusetts,

a Corporation, Complainants,

VS.

John C. Perkins, Commissioner of Insurance of the State

of South Dakota, Defendant.

At a term of said court held at the City of Sioux Falls in the Southern Division of said District of South Dakota on the 22nd day of December A. D. 1903, present the Honorable John E. Carland, District Judge.

The defendant above named having demurred to the bill of complaint herein for want of equity, Messrs. Preston & Hannett appearing as solicitors for the complainants and Philo Hall appearing as solicitor for the defendant, and the Court, after argument, having sustained said demurrer and the complainants having elected to stand upon their bill without amendment. Now therefore, on motion of defendant it is hereby ordered, adjudged

and decreed that the bill of complaint herein be and the same is hereby dismissed and that the defendant recover from the complainants his proper costs and disbursements to be taxed by the Clerk and inserted here at the sum of ... Dollars.

This is a bill in equity, filed in this court by The Hartford Fire Insurance Company, The Phoenix Insurance Company of Brooklyn, The Royal Insurance Company of Liverpool, The German American Fire Insurance Company, The Springfield Fire & Marine Insurance Company, all foreign insurance companies and corporations, against John C. Perkins, Commissioner of Insurance for the state of South Dakota, for the purpose of perpetually enjoining said Commissioner from enforcing the provisions of an act of the Legislative Assembly of the state of South Dakota, approved March 9th, 1903, and to have said act declared unconstitutional and void, as being in conflict with both State and Federal constitutions. The act referred to is as follows:

"Sec. 1. Combinations prohibited-penalty for violation] Any combination, agreement, confederation, compact or understanding made and entered into directly or indirectly, by or between two or more fire insurance companies insuring property against loss or damage by fire and loss or damage from the elements, transacting business within this state, or between officers, agents or employes of any such companies, relating to the rates to be charged for insurance, regulating or fixing the minimum price or premium to be paid for insuring property located within this state, the amount of commission to be allowed agents for procuring insurance or the manner of transacting the business of fire or other casualty insurance within this state, is hereby declared to be unlawful, and any such company, officer or agent violating the provision shall be deemed guilty of a misdemeanor, and on conviction thereof in any court having jurisdiction shall pay a penalty of not less than one hundred dollars nor more than five hundred dollars for each offense, to be recovered for the use of the general fund of the state, and any such company,

corporation or association so offending shall not be permitted to transact business within this state.

Sec. 2. Affidavit must be made when called for.] Any fire insurance company, corporation or association desiring to transact business within this state shall, in addition to the requirements now provided for by law, furnish the Insurance Commissioner of this state on or before the first day of July in each year, and at any other time during the year when called upon by the Insurance Commissioner of this state, as one of the conditions for being permitted to transact business within this state, an affidavit subscribed and sworn to by the president or secretary or managing officer of such corporation or association before competent authority, stating that said company of which he is an officer has not violated any of the provisions or the foregoing act, naming them, and such affidavit shall be in the following form:

I, — —, being first duly sworn, depose and say, that I am one of the managing officers of the company or association, and that said association has not entered and will not enter into any combination or agreement with any other fire insurance company or companies whatsoever, by which there is any understanding of whatsoever kind or character, either directly or indirectly, tending to fix or establish a uniform price or premiun for fire insurance in the state of South Dakota, or any agreement whatever, either directly or indirectly, relating to the rates to be charged for insurance within said state.

Sec. 3. Any officer or employe of insurance companies may be sumoned to appear before commissioner.] The Commissioner of Insurance of this state is hereby authorized to summon and bring before him for examination under oath any officer or employe of any fire insurance company transacting business within this state suspected of violating any of the provisions of this act; and on complaint in writing made to him by two or more residents of this state charging such company under oath upon their knowledge or information and belief, with violating the provisions of this act, said Insurance Commissioner shall summon and cause to be brought before him for examination under oath any officer or employe of said company; and if such examination and the examination of any other witnesses that may be produced and examined, the Insurance Commissioner shall determine that said company is guitly of a violation of any of the provisions of this act, or if any officer shall fail to appear or submit to an examination after being duly summoned, said commissioner shall forthwith issue an order revoking the authority of such company to transact business within this state, and such company shall not thereafter be permitted to transact the business of

*

fire insurance in this state at any time within one year from the time of such revocation.

Sec. 4. Testimony not to be used against person making the same.] The statements or declarations made or testified to by any such officer or agent in the investigation before the commissioner as provided in this act, shall not be used against any person making the same in any criminal prosecution against him, and no person shall be excused from testifying for the reason that his testimony so given will tend to criminate him.

Sec. 5. Repeal.] All acts and parts of acts in conflict with the foregoing provisions are hereby repealed.

Approved, March 9, 1903."

The defendant has demurred to the bill for want of equity and the cause is now before the Court after argument upon bill and demurrer. The bill alleges that complainants are, and have been, for many years last past, engaged in the business of insuring property against loss by fire in the state of South Dakota, and have always heretofore complied with, and are now complying with, all laws in force in the state of South Dakota regulating or appertaining to foreign insurance corporations, except the act hereinbefore referred to, which, as to complainants, is alleged to be unconstitutional and void. The specific portions of the State and Federal constitutions which it is claimed are violated by said act are as follows:

First: It is claimed that the act violates the state constitution, in that it confers judiciał power upon the Insurance Commissioner.

Second. That it violates Article 14 of the amendments to the Constitution of the United States, in that it deprives complainants of their liberty and property without due process of law and denies to them the equal protection of the laws.

Third. That it violates Section 10 of Article 1 of the Constitution of the United States, in that it impairs the obligation of contracts, or the liberty to make contracts.

Counsel for complainants in their brief, use the following language: "Ever since the decision of Paul vs. Virginia, 8 Wall. 163, it has been settled that a corporation created by one state, or by a foreign government, can exercise none of the functions or privileges conferred by its charter in any other state or country, except by the comity and consent of the latter. It follows that such assent may be granted upon such terms and conditions as those states may think proper to impose. They may exclude the foreign corporation entirely, they may restrict its business to particular localities, or they may exact such security for the performance of its contracts with their citizens as in their judgment will best promote the public interest, and the foreign corporation must assent to the terms imposed by the state. The state has the absolute right, we admit, to exclude such foreign corporation, or having granted it a license to do business within the state, to revoke it in its discretion. With the question of the expediency or policy of the statutes imposing these conditions upon foreign corporations, the courts have little to do."

With this statement of the laws this Court fully concurs, with the exception that instead of the words "little to do," this Court would say "nothing to do." If the sole power to say whether a foreign insurance corporation shall do business within the state of South Dakota is vested in the Legislative Assembly of such state, how can any law passed by the Assembly, which affects the right of foreign insurance corporations to do business in the state in the future, be called unconstitutional? The power to exclude a foreign insurance corporation from the state, or to prescribe the conditions upon which it may do business in the state in the future, is subject to no limitation of state or federal constitutions. Either this is true, or the law as stated by counsel is incorrect, for there cannot exist at the same time the absolute power to exclude a foreign insurance corporation if such power is subject to limitation. To say that a law, which absolutely excludes a foreign insurance corporation from the state or imposes conditions upon which the corporation may do business in the state in the future, is unconstitutional, involves a contradiction of terms, for the reason that all the right the foreign insurance corporation has to do business in the state must be found in whatever law the Legislative Assembly passes in that behalf. If such law would be unconstitutional, if attacked by a citizen of the state of South Dakota, still it would avail a foreign insurance corporation nothing to attack it, as such corporation is not a citizen entitled to all privileges and immunities of citizens in the several states. I am now speaking of legislation which prescribes rules for the future.

In the case of Doyle vs. The Continental Insurance Co., 94 U. S. 148, a law of Wisconsin provided that before a foreign insurance corporation could do business in that state, it should sign an agreement that in the event of its being sued in that state it would not remove the case to the Federal Courts, and if said foreign insurance incorporation should violate said agreement, it should be the duty of the Secretary of State to immediately cancel the license of said corporation to do business within the state. The law was confessedly invalid, so far as it sought to deprive the insurance company of the right to remove its cases to the Federal Courts, as was held in Insurance Co., vs. Morse, 20th Wall. 445. Still the Supreme Court, in the case first cited, said "the effect of our decision in this respect is that the state may compel the foreign company to abstain from Federal Courts or to cease to do business in the state. It gives the company the option. This is justifiable because the complainant has no constitutional right to do business in that state. That state has authority at any time to declare that it shall not transact business there. This is the whole point of the case, and without reference to the injustice, the prejudice, or the wrong that is alleged to exist, must determine the question. No right of the complainant, under the laws or the Constitution of the United States by its exclusion from the state, is infringed and this is what the state now accomplishes." Counsel for complainants, in order to avoid the unquestioned law with reference to the power of the state over foreign insurance corporations say in their brief: "Complainants hold that this Anti-Compact law, in its general frame, scope, legislative purpose, operation and effect, is to regulate and restrict all insur