UNITED STATES LIFE INS. CO. v. ROSS, 102 F. 722

McCORMICK, Circuit Judge. On October 21, 1897, J. E. Ross, the defendant in error, administrator of R. L. Long, deceased, brought his action against the United States Life Insurance Company, the plaintiff in error, in the state district court of Limestone county, Tex., to recover the sum of a policy .of insurance alleged to have been issued to1 the intestate, with legal interest thereon, and 12 per cent, damages, and a reasonable attorney’s fee.

The cause was duly removed into the circuit court of the United States for the Northern district of Texas, and such proceedings were had therein as resulted in a judgment in favor ■of the defendant in error. The specifications of error relied on to reverse this judgmeht are:

(1) That the court erred in overruling the motion of the plaintiff in error to suppress the deposition of J. W. Harris, and in admitting that deposition to he read in evidence over the objection of tbe plaintiff in error; (2) that the court erred in instructing the jury to return a verdict for flic defendant in error, over (.he objections of the plaintiff in error, made at tin; time, for (lie reason that the evidence in (his ease was conflicting as to whether the policy of insurance sued upon had been delivered to plaintiff's intes¡ate during his lifetime.

Bix errors are assigned, but the foregoing statement is the substance of the contention made by the plaintiff in error in this court. In the circuit court the plaintiff in error made (wo motions to suppress the deposition of the witness J. W. Harris, the first of which was filed on April 1, 1808, and the ground of this motion was that the deposition was taken without giving the plain! iff in error legal notice thereof. The United States Life Insurance Company is a corporation organized under (he laws of the state of New York. On the 7th day of October, 1893, by an agreement in writing, it appointed James W.

Harris, of AYaco, Tex., its agent for all that part of the slate of Texas in which it authorizes its agents to do business (except a certain portion (hen under contract to A. J. Miller, of Ft. Worth), and at or about the same lime it constituted and appointed him its attorney to receive and accept service of process agreeably to the statute laws of that state. On the 15th of January, 1897, it duly renewed this appointment.

The written agreement constituting Harris the agent of the insurance company in Texas provided, among other things, that either party thereto might terminate it by giving to the other 30 days’ notice in writing to that effect. Acting on this provision, the insurance company gave notice to Harris of the termination of their contract, and it became complete, and the contract terminated, on the 9th of September, 1897. On September 25, 1897, and again on October 6, 1897, the counsel who now appear for the defendant in error wrote to the plaintiff in error demanding the payment of the amount of the R. L. Long policy.

On October 16, 1897, the plaintiff in error, by its actuary, William T. Standen, addressed a letter to Hon. Jefferson Johnson, insurance commissioner of the state of Texas, advising him that: “Mr. .T. W. Harris, of Waco, Tex., ⅛ no lousier our manager, and subagents working for him. and for whom you issued licenses, no longer represent this company In that way. We therefore ask you to promptly revoke the licenses and power of acceptance on behalf of this company issued to Mr.

Harris and all the subagents above referred to, as we have now no accredited representative working for us in your state.” On October 19, 1897, Commissioner Johnson acknowledged the receipt of this letter of revocation of authority of Mr. J. W.

Harris and other agents to represent the company in Texas, and said, “Their certificates of authority and power to accept sin-vice have been canceled by this office.” On October 22, 1897, the commissioner wrote again to the plaintiff in error to this effect: ‘“Gentlemen: After a consultation with the attorney general, we are of opinion that you have no right to cancel or order the cancellation of the powers of attorney (o your agents-In Íhis state.

The intent of the law is that no life insurance company shall ho permitted to transact business or to collect premiums upon policies in force in lilt; state of Texas without having an attorney appointed in the state to accept service from such policy holders as may-have a legal claim against the company. Yon may regard our letter accepting your cancellation as haying no authority, as we now declare these powers of attorney as being good, unless you shall appoint an attorney for service at once in this state. AYe await your action in this matter before taking any further steps.

It will not be profitable for tbe United States Life Insurance Company to undertake to avoid suit by tbe method you have seen fit to follow. “Yours, very truly, Jefferson Johnson, Commissioner.” On October 23, 1897, tbe proper notice for taking tbe deposition of J. W. Harris, with a copy of tbe interrogatories, and a precepc to serve tbe same, was issued to tbe -sheriff of McLennan county, Tex., and on tbe 25th of October was duly received by bim, and served on J. W. Harris and W. W. Seiey as agents of tbe United States Life Insurance Company. W. W.

Seiey is tbe president and sole owner of tbe Waco State Bank in Waco. On two or three occasions (tbe dates not given) tbe plaintiff in error bad forwarded to tbe Waco State Bank claims upon its policy holders for premiums, etc., which were collected by tbe bank in the usual course of business, but not as agent for tbe United States Life Insurance Company, except for tbe special collection of each particular claim as received in tbe usual course of bank collections. This motion to suppress tbe deposition of J. W.

Harris came on to be beard on tbe 22d of April, 1898, and tbe court, having-beard tbe motion, tbe answer of tbe plaintiff thereto, and the argument of counsel thereon, was of opinion that tbe motion was not well taken, and on April 27, 1898, ordered that the same be overruled; to which ruling tbe defendant (tbe plaintiff in error), by its counsel, excepted,’and tendered its bill of exceptions.

In this bill of exceptions it is stated that on tbe bearing of this motion “it was further shown that tbe plaintiff never at any time received notice from tbe defendant company of tbe appointment of Jefferson Johnson as its attorney to receive service in lieu of tbe said Harris, and only received notice of said appointment of said Johnson from the said Johnson himself on or about October 30, 1897. • It was admitted by tbe defendant that immediately upon notice of tbe appointment of said Johnson as tbe defendant’s attorney to receive service in lieu of said Harris, which was after tbe perfection of service on said Hárris and said Seiey, tbe plaintiff caused service of notice and copies of interrogatories to be made on tbe said Johnson as tbe defendant’s attorney, and that upon the expiration of tbe five days provided by tbe laws of tbe state of Texas for service of notice and copies of interrogatories upon said Johnson tbe plaintiff caused a commission to issue, with said interrogatories and tbe cross interrogatories of defendant attached, to take tbe answers of tbe witness J.

W. Harris; and that before said commission could reach the bands of an officer qualified to take depositions, and immediately after tbe issuance of said commission, tbe said J. W. Harris died.” On April 27,1899, tbe plaintiff in error (the defendant below) made a second motion to suppress tbe deposition of J. W. Harris —First, on tbe ground on which its first motion bad been made; and, second, because it appeared from tbe deposition, and from tbe interrogatories filed by tbe plaintiff, and from other portions of tbe record, “that at tbe time said deposition was taken tbe witness J. W.

Harris resided at Waco, in tbe county of McLennan, in tbe state of Texas, and that this suit was then pending at tbe county seat of Limestone county, in tbe state of Texas, to wit, at tbe town of G-roesbeck; and it is alleged that said town of Groesbeck is distant from tbe town of Waco, which was then and there tbe residence of tbe witness J. W.

Harris, less than one hundred miles, to wit, a distance of fifty miles, and that under the laws of the United States in such cases made and provided said deposition was unauthorized and invalid, and cannot be used upon the trial of this case.” The second ground of this motion to suppress the deposition of J. W. Harris is clearly not good. The deposition was taken while the case was yet in the state court, in strict accordance with the provisions of the slate law and practice in all other respects except that which is made the first ground of this motion.

After the case was removed to the circuit court, the question whether the deposition could he used on the trial is one of federal, and not state, practice. But it is one which does not relate hack to the time of the faking of the deposition under the state law. It appears from the recita-1 ion we have made from the bill of exceptions taken to the overrating or the first motion to suppress this deposition that several months be fore that motion was made the witness Harris had died, and at the time that motion was heard it was made to appear to the satisfaction of the court that the witness then was dead.

If, therefore, the deposition was correctly taken according to the state law and practice, and it was made to appear to the satisfaction of the court that at the time the motion to suppress the deposition was acted upon, and at the time the deposition was offered in evidence on the trial, the witness was dead, the objection taken that the witness resided at a point less than 100 miles distant from the point where the state court was held, in which court the cause was pending at the time the deposition was taken, is not good.

The act of congress approved March 9, 1892, provides that it shall he lawful to take the deposition or testimony of witnesses in the mode prescribed by the laws of the state in which the courts are held. But, independent of this act, the taking of depositions in the state court must he governed by state law. And

section 8(55 of the Revised Statutes provides that, where depositions have been properly taken, such depositions may he used on the trial of the cause when it ajjpears to the satisfaction of the court that the witness is then dead. By the laws and practice in Texas depositions may he taken in the state courts where the witness resides without the county in which the court is held. This record shows that the state court in which the case was pending was held in Limestone county, and that the witness resided in McLennan county.

Unless, therefore, the objection which suggests the want of proper notice is good, the motion to suppress the deposition was properly overruled. As far as we can gather from the very able briefs, and from such consideration of the case as we have been able to give it ourselves, this ground of the motion presents a question of first impression. We have been referred to no direct authority on the subject, nor to any having a very close analogy as we view it.

But, acting on our own construction of the language of the different provisions of the statute law of Texas on the subject, and gathering therefrom the apparent intention and spirit of the legislation of that state in reference to foreign corporations doing business therein, we are constrained to concur in the view of the attorney general of the slate of Texas, and of the commissioner of insurance, and of the learned judge of the circuit court who overruled the motion, and we hold with him that the service of the notice to take the deposition in question, which was made upon J. W.

Hams on the Both day of October, 1897, having been made before the plaintiff in error had appointed Hon. Jefferson Johnson its attorney to acknowledge service of legal.process in any suit or legal proceeding against said company in the state of Texas (which latter appointment seems not to have been made in New York until the-26th day of October, 1897, and not to have reached the appointee in Texas until the 30th day of that month) is binding on the plaintiff in error, and constituted legal notice to it of the intention of the defendant in error to take the deposition in question.

That there was no necessary connection between the service that J. W. Harris was to render under his contract as the business agent of the licensee, and his competency or duty to accept service of legal process, or have the same served on him so as to bind the plaintiff in error, manifestly appears from the fact that at present the honorable commissioner of insurance, who certainly is not the business agent of the plaintiff in error, is constituted its representative to acknowledge service of legal process, etc.

It will hardly be contended that the plaintiff in error could now revoke the authority of the Honorable Commissioner Jefferson Johnson to accept or receive service of legal process binding on the company without at the same time appointing some other attorney by whom such service could be accepted, or on whom service could be made. In the nature of the case, the appointee, while still alive, and capable of being reached, must continue to be competent to have such service made on him until a successor is appointed, and has qualified by acceptance.

Therefore the fact that the agreement between the plaintiff in error and J. W. Harris terminated, according to its terms, on the 9th of September, 1897, does not necessarily involve or affect that representative capacity in which he was authorized to accept service of legal process, or at least to have service made upon him agreeably to the terms of the statutes -of Texas for the protection of the citizens of Texas who held policies of insurance issued by the plaintiff in error, then doing business under and subject to the terms of its permission in that state.

One of the vital conditions precedent to obtaining and using such permission was and is that the licensee should have and keep in that state such a representative by whom service could be accepted, or upon whom it could be had. We think the commissioner decided justly and wisely that the plaintiff in error could not revoke the authority it had granted without substituting another appointee by whom service could be accepted, or on whom it could be made, so as to bind the licensee. We conclude, therefore, that the first specification of error urged upon our attention is not well taken.

As to the second specification of error, given above, we are clear that it is not well taken. We have examined all the testimony with care, and we believe that the

summary made by the trial judge is so supported by all the evidence that we are justified in accepting it as the uncontradicted testimony in the case. We therefore content ourselves with introducing here that part of the judge’s charge which summarizes the proof: “

(1) Robert L. Long made his application in writing August 30, 1S94, to the defendant company, for insurance upon his life in the sum of ten thousand dollars.

(2) That, in pursuance oí said application, the defendant company issued the policy sued upon September 10, 1891, and immediately (hereafter transmitted' the said policy from its home office in New York City to .1. W. Harris, of Waco, Texas, he then and there being the general agent of the defendant company for Texas.

(3) That shortly after receiving said policy ihe said J. W. Harris went to Mexia, Texas, and took the policy with him for the purpose of delivering it to the said Robert L. Long, and collecting from him tiie first semiannual premium due thereon, amounting to $(>8.10.

(4) That the said Robert L. Long accepted the said policy, and by agreement between him and the said J. W. Harris the said J. W. Harris agreed to pay said first premium for the said R. L. Long to ¡lie defendant company, and at the request of Lie said Robert L. Long the said J. W. Harris retained possession oí said policy.

(5) The said J. W. Harris delivered to the sa>'d R. L. Long said policy, and by his monthly report of November 28, 1894, remitted to (he defendant company the said first semiannual premium; and that the said defendant company received the same shortly thereafter, and during the lifetime and sound health of ihe said Robert L. Long, and retained possession of same until advised of the death of the said R. L. Long. ((>) That the said Robert L. Long died January 19, 1895.

(7) That the defendant company waived proofs of death of the said Robert L. Long.

That, the foregoing facts having been proven upon this trial, and being undisputed, you will find for the plaintiff.” It is contended in the brief for Ihe plaintiff in error, and urged in the earnest oral argument made by its counsel in this court, that the deposition of ihe witness Harris, and the letter dated January 31, L895, written by Harris to the company, and offered in evidence by the defendant in error on the trial of this case in the circuit court, conflict the one with the other, and present such an impeachment of that witness’ veracity as to require that iiis deposition and his letter, in connection with the other testimony in the case, should have been submitted to the jury.' We do not find the substantial variance as to any matter of fact in the deposition and the letter in question which counsel for the plaintiff in error suggests.

To our minds, the substantive facts appear to be clearly shown by the letter and the deposition, the one in accord with the other; and on the proof as presented on the trial it became the duty of the trial judge to direct a verdict for the plaintiff, because, if he had not done so, and a different verdict had been returned, it would have been his duty to have set the verdict aside, and have awarded the plaintiff a new trial.

Where the state of proof presents such a case, the judge is clearly right in directing a verdict; and, though it is a matter of some delicacy to review his discretion in cases where that discretion is exercised in favor of submitting an issue to the jury, the tendency of the later decisions is to hold the trial judge rigidly to the discharge of Ms duty, and, where ihe proof is such that It could rightly sustain but one view of the case, to direct a verdict. The judgment of the circuit court is affirmed. PARDEE, Circuit Judge, dissents.