AGENT UPON WHOM PROCESS MAY BE SERVED.

Sec. 616, Pol. C. The insurance commissioner must require, as a condition precedent to the transaction of insurance business in this state by any foreign corporation or company, that such corporation or company must file in his office the name of an agent and his place of residence in this state, on whom summons and other process may be served in all actions or other legal proceedings against such corporation or company. All process so served gives jurisdiction over the person of such corporation or company. The agent so appointed and designated shall be deemed in law a general agent, and must be the principal agent or chief manager of the business of such corporation or company in this state. Any such foreign corporation or company shall, as a further condition precedent to the transaction of insurance business in this state, and in consideration of the privilege to transact such insurance business in this state, make and file with the insurance commissioner an agreement or stipulation, executed by the proper authorities of such corporation or company, in form and substance as follows: The (giving name of corporation or company) does hereby stipulate and agree, that in consideration of the permission granted by the state of California to it to transact insurance business in this state, that if at any time said corporation or company shall be without an agent in said state, on whom summons or other legal process may be served, service of such summons or other legal process may be made upon the insurance commissioner, such service upon the commissioner to have the same force and effect as if made upon the corporation or company. Whenever such service of summons or other legal process shall be made upon the insurance commissioner, he must, within ten days thereafter, transmit by mail, postage paid, a copy of such summons or other legal process to the company or corporation, addressed to the president or secretary thereof, at its home or principal office. Such copy must be certified by the commissioner, under his hand and official seal, and the sending of such copy by the said commissioner shall be a necessary part of the service of summons or other legal process. En. March 12, 1872. Amd. 187374, 63; 1877-78, 17.

Legislative History.

This section is based on section 1 of the act concerning foreign corporations of 1870, page 881.

The original section contained only the first two sentences of the above. The amended section of 1873-74 was the same as the above down to the stipulation to be entered into by foreign corporations. The following is the last part of the section as amended in 1873-74: "The (giving name of corporation or company), does hereby stipulate and agree, that in consideration of the permission granted by the state of California to it, to transact insurance business in that state, that in all litigation between (giving name of corpotation or company), and any citizen of the state of California, the courts of said state shall have and maintain exclusive jurisdiction of such litigation. And it is further agreed that no action hereafter commenced in any district court of said state of California against (insert name), shall be removed or transferred therefrom to the United States circuit court. If in any action hereafter commenced in any district court of this state, by a citizen thereof, against a foreign corporation or company doing insurance business in said state, such corporation or company shall transfer, or cause to be transferred, such action to the United States circuit court, the right of such corporation or company to transact insurance business in said state shall thereupon and thereby cease and determine; and the insurance commissioner shall immediately revoke the certificate of such corporation or company, authorizing it to do business in said state of California.

Section Cited.

Gutzeil v. Pennie, 95 Cal. 600, 30 Pac. 836; Harrigan v. Home Life Ins. Co., 128 Cal. 537-539, 58 Pac. 180, 61 Pac, 99.

Annotation.

Designation of Agent.-When a surety company has filed with the commissioner the designation required by this section, that is all that is required of it in the matter of naming an agent upon whom process may be served, to entitle it to do business in this state, although the failure to file the designation required by section 1056 of the Code of Civil Procedure with the Secretary of State might deprive it of the benefit of the statute of limitations, as provided by the act of April 1, 1872 (Stats. 1871-72, p. 826). (Gutzeil v. Pennie, 95 Cal. 598, 30 Pac. 836.) Held, however, that the act of 1872 does not apply to foreign insurance companies, but that their rights and duties, with respect to the appointment of agents for the service of process are prescribed and regulated by these provisions of this code. (Harrigan v. Home Life Ins. Co., 128 Cal. 539, 58 Pac. 180, 61 Pac. 99.)

PENALTY FOR FAILURE TO MAKE STATEMENT.

Sec. 617, Pol. C. The commissioner must collect the sum of one hundred dollars from any company or corporation engaged in the business of insurance in this state, for a failure to make and file in his office within the time prescribed by law, the statements and stipulations required by sections six hundred and ten, six hundred and eleven, six hundred and twelve, six hundred and thirteen, and six hundred and sixteen of this code, and an additional penalty of two hundred dollars for each and every month or fractional part of a month thereafter that such company or corporation continues to transact the business of insurance until such statements and stipulations are filed; and for that purpose suits may be instituted by the insurance commissioner, in the name of the people of the state of California, in any court of competent jurisdiction. And for all lawful expenses incurred under this section or any other section of this code, in the prosecution of any suit or proceeding for the enforcement of the insurance laws of this state, the insurance commissioner must present bills duly certified by him, with the vouchers, to the state board of examiners, who must allow the same and direct payment thereof to be made; and the controller shall draw warrants therefor on the treasurer for the payment of the same to the insurance commissioner (in addition to the ordinary contingent expenses) out of the general fund. En. March 12, 1872. Amd. 1873-74, 65; 1877-78, 18; 1887, 11. Legislative History.

This section is based on section 7 of the insurance act of 1866, page 328.

The original action is as follows: "Sec. 617. The commissioner must collect the sum of five hundred dollars from any person or corporation engaged in the business of insurance for a failure to rake and deposit in his office the statements provided for in the eighth preceding section, and an additional penalty of one thousand dollars for each and every month thereafter that such person or corporation continues to transact the business of insurance until such certificate and statement is filed, and for that purpose suits may be instituted in the name of the people of the state of California in any court of competent jurisdiction."

The amendments of 1873-74 and 1877-78 changed the requirements and amount of fine. Under the amendment of 1877-78 the fines were one thousand dollars for failure to file statement, and two

thousand dollars for transacting business without having filed state: mrents. The amendment of 1887 reduced the fines and added the last sentence.

SECURITIES DEPOSITED BY COMPANIES.

Sec. 618, Pol. C. Whenever the laws of any state of the United States, or of any country foreign to the United States, require any insurance company or corporation organized under the laws of this state, to deposit with some officer of this state securities in trust for, and for the benefit of, the policy holders of such company or corporation, as a prerequisite to transacting insurance business in such other state or foreign country, and whenever under any laws of this state any insurance company or corporation is required to deposit with any officer of this state securities in trust for, and for the benefit of policy holders of such company or corporation, the insurance commissioner of this state must receive from such company or corporation securities in the amount required by the law under which such deposit is made on deposit and in trust for the policy holders of such company or corporation. The value of such securities. must be equal to the value of interest-bearing stocks and bonds. of the United States government, but none of such securities must be estimated above the par value of the same, nor above their market value. The commissioner must, upon the receipt. of such securities, forthwith make a special deposit of the same in the state treasury, in packages marked with the name of the company or corporation from whom received, where they must remain as security for policy holders in the company or corporation to which they respectively belong; but so long as the company or corporation continues solvent he must permit it to collect the interest or dividends on the securities so deposited, and from time to time to withdraw any such securities on depositing other securities in the stead of those to be withdrawn. Such new securities to be of the same value mentioned in this section, but such securities must not be withdrawn from the state treasury unless upon the written order of the acting president and secretary of the corporation making the deposits, which order must be indorsed by the commissioner, or upon the order and authority of some court of competent jurisdiction. En. March 12, 1872; Amd. 1877-78, 18.

Legislative History.

This section is based on section 1 of the insurance act of 1870, page 321. The original section did not provide for the requirements of foreign countries, nor did it provide that the securities should not be estimated above their par or above their market value.

DEPOSITS, RECEIPTS FOR.

Sec. 619, Pol. C. Whenever any insurance company or corporation has deposited with the commissioner the requisite security, in conformity with the requirements of the preceding section, the commissioner must issue to such company or corporation a certificate, under his official seal, of such deposit, for each state or country requiring the same; which said certificate must state the items and amount of securities so deposited, and that they are of the value therein represented. En. March 12, 1872. Amd. 1877-78, 19.

Legislative History.

This section is based on section 2 of the insurance act of 1870, page 321. The original section is as follows: "Sec. 619. Whenever any life insurance corporation, organized under the laws of this state, has deposited with the commissioner the requisite securities, in conformity with the laws of the state in which such corporation is desirous of transacting its business, he must issue to such corporation a certificate, under his official seal, of such deposit, for each state requiring the same, which must state the items and amount of securities thus deposited, and that they are of the market value represented therein; but no securities must be estimated above the par value of the same."

DEPOSITS RETURNED, WHEN.

Sec. 620, Pol. C. Whenever any insurance company or corporation so depositing securities with the commissioner, has paid, canceled or reinsured all its unexpired policies outstanding in the state, satisfactorily to the holders thereof, and all its liabilities under such policies are extinguished or assumed by other responsible companies or corporations, then, if on application of such company, or corporations, verified by the oaths of its president and secretary, and from an examination of the books of the corporation, and of its officers, under oath, the insurance commissioner is satisfied that all of its policies are so

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