UNITED STATES SUPREME COURT DECISIONS ON-LINE

A corporation created by one state can transact business in another state only with the consent of the latter, which may accompany its consent with such conditions as it thinks proper to impose, provided they are not repugnant to the Constitution and laws of the United States or inconsistent either with those rules of public law which secure the jurisdiction and authority of each state from encroachment by all others or those principles of natural justice which forbid condemnation without opportunity for defense.

Where an insurance company, citizen of one state, has voluntarily accepted clubjuris

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a license from another state, and has been sued in a court of that state, the fact that the license is subject to be revoked if the company should remove the action to the federal courts furnishes no ground for appealing to a federal court to take jurisdiction of a suit in equity to cancel the policy if otherwise the court would have no jurisdiction.

The theory that a complainant has no adequate remedy at law because it would not have the same control over an action brought against it as defendant as it would have as plaintiff in a suit brought by it, does not lay the foundation for the jurisdiction of a federal court in an action in equity to enjoin the prosecution of the suit against it.

Equitable jurisdiction does not accrue to the federal court because it is thought that the law as administered by it is more favorable to a party seeking its aid than the law as administered by the courts of a state in which it has been sued.

This case comes here upon certiorari, applied for by the petitioner, who was the administratrix of the estate of Herman D. Cable, deceased. 186 U.S. 482. The suit was brought in the Circuit Court of the United States for the Northern District of Illinois by complainant, the United States Life Insurance Company, of the City of New York and a citizen of that state, against Alice A. Cable, a citizen of the State of Illinois, to have a certain policy of insurance for $50,000, payable as therein stated, upon the life of the said Herman D. Cable, delivered up for cancellation on the ground that the same had been procured by the fraud of the agents of the deceased. The bill averred that the complainant was an insurance company of New York, lawfully engaged in doing business throughout the United States, and particularly in Illinois, under a permit or license duly granted therefor; that it had issued its policy upon the life of Herman D. Cable, and that it was procured by the fraud and fraudulent representations of his agents, such fraud and fraudulent representations being set forth at length; also that defendant had commenced a suit in the state court of Illinois to recover upon the policy, which suit was instituted about one and a half hours prior to the filing of complainant's original bill. A supplemental and amended bill was filed, in which, among other things, it was alleged: clubjuris

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"10. Your orator further avers that the Constitution and laws of the United States of America confer upon your orator the right to remove into this court said action at law so begun against your orator; that, on the other hand, the State of Illinois, by legislative enactment, has sought to prevent the removal to this court by insurance companies of actions similar to said action so begun by said administratrix, and has practically destroyed such right or made its exercise impracticable by providing in substance that an insurance company shall forfeit and lose its right to do business in the State of Illinois upon removing any such action into this court; that, by removing said action to this court, your orator might lose its right to transact business in the State of Illinois, and would certainly become involved in serious controversy with said state respecting the transaction of any subsequent business by your orator in said state; that the laws of said state upon certain questions of general insurance law, as interpreted by its highest legal tribunal, and applicable to the facts in this case, are somewhat different from the laws of the United States as interpreted by the federal courts, upon the same questions, and from the standpoint of the laws of the United States are unduly and erroneously adverse to insurance companies; that your orator is entitled to an application of the law according to the decisions of the federal courts, and that, under the facts and circumstances hereinbefore set forth in this bill, your orator is without a due and proper remedy at law in respect to the claim of said administratrix under said policy of insurance, but is without any remedy at law whatever in this Court."

To this bill the defendant interposed a demurrer, among other things, for want of equity, and that demurrer was sustained by the circuit court, but upon appeal to the Circuit Court of Appeals for the Seventh Circuit, the decree sustaining the demurrer was overruled and the case remanded to the circuit court. 98 F.7d 1.

An answer was then put in by the administratrix of Cable's clubjuris

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estate denying any fraud and averring that she had, before the suit in the federal court was commenced, herself commenced an action upon the policy in a proper state court of Illinois, and that it was her intention and desire to push such action to a speedy conclusion if permitted by the federal court.

The suit herein was tried and a decree entered that the policy was procured on behalf of the deceased by constructive fraud, and that no actual fraud was intended or practiced in the delivery of the same, and it was thereupon decreed that the policy should be delivered up and cancelled. The defendant appealed from such decree to the circuit court of appeals, and the complainant took a cross-appeal so as to bring up the findings of fact as to the constructive fraud, so that, as counsel said,

"the case might be heard and considered in the circuit court of appeals upon the whole evidence, regardless of the findings of the master and of the circuit court."

This was done for the reason that, in counsel's belief, the evidence showed a deliberate and intentional concealment on the part of Lord, the agent of the deceased, and therefore a plain fraud perpetrated by such agent. The circuit court of appeals affirmed the judgment, and upon application, this Court granted the writ of certiorari as stated. clubjuris

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