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Section 5 provides:

Said company is hereby authorized and empowered to acquire, by condemnation, from time to time, such lands, and such interests and estates in lands, as said company may from time to time take under the authority of this act, in the manner hereinafter provided. . .

From these sections it appears that the name of the Terminal Company was originally the New York, Providence & Boston & Old Colony Railroad Terminal Company; that it is empowered to locate, lay out, construct, maintain and operate, by steam or other power, a railroad; and to acquire property by condemnation. In other words, it is apparently clothed with the rights, and presumably the liabilities, of a public-service railroad corporation. Obviously, it is a railroad company, unless the omission of the word "railroad" from its name prevents its becoming such a corporation. I do not think that this omission has such an effect.

The term "railroad" has been broadly interpreted in other statutes of the Commonwealth. Under St. 1887, c. 270, providing for employers' liability "by reason of the negligence of any person in the service of an employer who has the charge or control of any signal, switch, locomotive engine or train upon a railroad," it has been held that a short-line track built and operated by a city for the sole purpose of transporting gravel from one part of its water works to another was a railroad.

In Coughlan v. Cambridge, 166 Mass. 268, on p. 276, the court said:

The track was a short and temporary affair, and the use of it and of the locomotive and cars was to continue only for a short time; but we think that it was a railroad within the meaning of the act.

From the powers given the Terminal Company and from the definition given to the term "railroad" in this State, I am of opinion that the company is a railroad within the meaning of the statute relating to savings bank investments.

But section 21 of the act of incorporation of the Providence Terminal Company provides that:

If said company shall fail to begin the location, lay-out, and construction of its said railroad as provided by section 3 of this act on or before May 15, A.D. 1906, and complete the same on or before May 15, A.D. 1909, this act shall be void and of no effect, but the right of any person to recover damages by reason of anything theretofore done by said company shall in no wise be impaired.

The location of the railroad has been filed and the necessary proceedings in court taken, so that it has acquired by condemnation the land upon which to build the road, and it has issued bonds secured by first mortgage upon its terminals, railroad and franchise, which are guaranteed by the New York, New Haven & Hartford Railroad Company, but until the road is completed the company has not an indefeasible charter, but merely one that is subject to being rendered void in 1909. I also think that in the phrase "whose road is located wholly or in part in the same," in R. L., c. 113, § 26, cl. 3, par. b, the words "whose road is located" must be interpreted to refer to a physical roadbed completely constructed, and not to a location in the narrow sense of a place dedicated to the easement of the railroad and identified either by being plotted out on a map or by stakes driven in the ground. The purpose of the act itself leads inevitably to this conclusion. That purpose being to limit the field of investment to obligations secured in the most thorough manner, it can hardly be fulfilled if the act is so construed as to permit a company, having nothing but a charter and the condemnation of the land upon which to build the road, to mortgage these scanty assets and sell its bonds to savings banks.

Upon the whole, therefore, although the matter is not free from doubt, and might bear a technical construction the other way, I am of opinion that though the Providence Terminal Company is a railroad company within the meaning of the act, its first mortgage bonds, guaranteed by the New York, New Haven & Hartford Railroad Company, are not legal investments for savings banks in Massachusetts, and will not be so until the construction of the roadbed is completed, and then only if it was begun before May 15, 1906, and finished before May 15, 1909.

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R. L., c. 118, § 68, providing in part that no life insurance company doing business in this Commonwealth, nor any agent thereof, shall "pay or allow, or offer to pay or allow as inducement to insurance, any rebate of premium payable on the policy, . . . " prohibits the allowance by any such company to its agent of any commission on the premium on a policy upon the life of such agent, or the allowance to an officer of such company of any rebate of or commission on the premium on a policy upon the life of such officer.

You ask the two following questions relative to R. L., c. 118, To the §68:

1. If it is a violation of said statute for a life insurance company, duly authorized to transact the business of life insurance in this commonwealth, to allow its agent a commission on the premium on a policy on his own life?

2. If it is a violation of said statute for such a company to pay or allow an officer of the company a rebate of or a commission on the premium on a policy on his own life?

R. L., c. 118, § 68, is as follows:

No life insurance company doing business in this commonwealth shall make or permit any distinction or discrimination in favor of individuals between insurants of the same class and equal expectation of life in the amount or payment of premiums or rates charged for policies of life or endowment insurance, or in the dividends or other benefits payable thereon, or in any other of the terms and conditions of the contracts it makes; nor shall any such company or any agent thereof make any contract of insurance, or agreement as to such contract, other than as plainly expressed in the policy issued thereon; nor shall any such company or agent pay or allow, or offer to pay or allow as inducement to insurance, any rebate of premium payable on the policy, or any special favor or advantage in the dividends or other benefit to accrue thereon, or any valuable consideration or inducement not specified in the policy contract of


The other sections of the statute which bear upon these questions are sections 87, 89 and 111. Section 87 provides:

Every domestic insurance company shall file with the insurance commissioner the name and residence of each person it appoints or employs to act as its agent in this commonwealth; and whoever shall assume to

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act as such agent, or, unless a licensed broker, shall in any manner for compensation aid in negotiating contracts of insurance on behalf of such corporation for a person other than himself, prior to the filing of such notice of appointment, shall be subject to the penalties of section one hundred and eleven.

I am of opinion that both questions should be answered in the affirmative. The object of section 68 is, obviously, to prevent any insurant from obtaining in any way, directly or indirectly, an advantage over any other insurant of the same class. The object of section 87 is to permit registered agents and licensed brokers, and no others, to negotiate contracts of insurance for persons other than themselves. I do not think the phrase "for a person other than himself" was meant by the Legislature to be joined with the phrase "in any manner for compensation" in such a way as to indicate that a person could negotiate a contract for himself for compensation. The object of the section, as a whole, was, in my opinion, to exempt persons from liability who either negotiate contracts of insurance for themselves or for others, but gratuitously.

I think this interpretation is borne out by the language of section 89, where it is provided that "an officer of a company or a person appointed as its agent for that purpose, or acting without compensation," may negotiate insurance. The words in this section, "or acting without compensation," to make sense must qualify the word "person," i.e., so as to read, "a person appointed as its agent or acting without compensation may," etc. These provisions indicate, to my mind, that it is perfectly proper under any circumstances for an officer of a domestic insurance company, or for a person appointed as its agent, or for a duly licensed broker, or for a person acting for himself solely, or for a person acting for others without compensation, to negotiate insurance, provided that they do not violate section 68 with respect to giving the person insured some special favor or advantage. The fact that all these persons may lawfully negotiate insurance does not give them the right to negotiate insurance in any manner in which the company itself could not negotiate.

I think it may be assumed that section 68, as well as the other sections above referred to, was enacted at a time when life insurance in Massachusetts was carried on as it is to-day, by the active solicitation of persons to be insured by agents and brokers; and I think it may further be assumed that the Legislature knew that the ordinary method of paying for such work was by commissions upon the business done by such agents and brokers.

The question, therefore, narrows itself to this: Is the granting of the customary commission to an agent or an officer of a corporation for securing a policy on his own life a rebate paid or allowed as an inducement to insurance? I am of opinion that it is. It is certainly a rebate paid or allowed, because it is, though in the form of a commission, an allowance to the person insured, given for no services rendered. It can hardly be maintained that it is a service rendered to persuade one's self to take out insurance in one's own company. I think it is, further, a payment or allowance as an inducement to insurance. To test this, let us suppose that the agent of a company desired insurance in a first-class company. If he went to the agent of some other company he would pay the ordinary premium and the other agent would get the commission. If he said to the other agent, "I will insure myself in your company through you if you will insure yourself in my company through me, and we will thereby each get a commission," I believe that such a contract would be unlawful under section 68, because it would amount to some special inducement to insurance, paid or offered to each.

Can the agent, then, accomplish this same result by writing his own insurance himself? In other words, can he stand in the dual position of the insurant and the person negotiating the contract? I am of opinion that he cannot, and that when he applies to the company for a policy he stands as a would-be insurant and must be treated as such, and that he cannot be benefited by the payment or allowance to him of any sum, whether it is in terms a commission or a rebate.

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