Prudence Mutual Life Insurance v. Caminetti

SHAW, J. pro tem. This is a proceeding in mandate, brought by petitioner, which is a corporation organized to transact the business of life insurance under the mutual benefit assessment plan provided for by chapter 8 of part 2, division 2, of the Insurance Code, to compel the defendant Insurance Commissioner to issue to it a renewal certificate of authority to do business under that chapter and also to approve proceedings taken by it to transform itself into a mutual life and disability insurer operating under chapter 9 of said part of the Insurance Code and issue it a certificate of authority to do business under chapter 9. By the judg[956]ment the petitioner was awarded the writ which it sought, and the Insurance Commissioner appeals.

This ease was tried with Caminetti v. Prudence Mutual Life Insurance Association, ante, p. 945 [146 P.2d 15], this day decided by us, and was submitted to and decided by the superior court on the evidence in that case. The record shows that after issuing to petitioner one or two temporary certificates to continue in business under chapter 8 of the Insurance Code, the Insurance Commissioner obtained an order appointing him conservator of its business and took over the business. This order was considered in Caminetti v. Prudence Mutual Life Insurance Association, supra, which is referred to for further details regarding it. If this order stands, the petitioner is not entitled to a certificate of authority to do business, under either chapter 8 or chapter 9, for by it petitioner’s business was turned over to the Insurance Commissioner as conservator, and in consequence it can do no business. By the judgment appealed from in Caminetti v. Prudence Mutual Life Insurance Association, supra, the order appointing the conservator was “cancelled and terminated.” By our decision in that matter the judgment there appealed from is affirmed. Consequently, the judgment here is proper, so far as the certificate of authority under chapter 8 is concerned. (Imperial Mut. L. Ins. Co. v. Caminetti (1943), 59 Cal.App.2d 494, 498 [139 P.2d 693].)

But the judgment, so far as it directs a writ to compel the commissioner to approve the transformation and issue to petitioner a certificate of authority to do business under chapter 9 is erroneous. Such a transformation is authorized and provided for by article 10 of chapter 8 above mentioned. Section 10739 of this article provides that when an association “has-accumulated a fund of twenty-five thousand dollars or more in excess of all liabilities for undisputed claims or expenses incurred and taxes” it may transform itself so as to do business under chapter 9. Section 10740 of the same article provides that “Any such association at its option, instead of depositing twenty-five thousand dollars as provided for in section 10739 of this chapter, may, on or before August 1, 1941, deposit five thousand dollars at the time of transformation, and the balance of twenty thousand dollars” over a period of four years. Section 10740 is manifestly in error in referring to section 10739 as providing for a deposit of $25,000, but we need not decide what is