costs, and if it should fail they should pay their pro rata proportion of the judgment, attorney's fees, and costs. It was held that the agreement, at most, made the U. Company the agent of the reinsurers to make the defense, and not a trustee for them; that the reinsurers had the right at any time to come in and defend on their own behalf; and that there was nothing in the agreement which required the U. Company to retain a pecuniary interest in the litigation, or forbade it to make a compromise of its liability. On the other hand, in Commercial Assur. Co. v. American Cent. Ins. Co., 68 Cal. 430, 9 Pac. 712, where on suit being brought against the original insurer it was agreed that it should control the defense, it was held that the reinsurer was not liable to the original insurer for any part of the money paid by the original insurer by way of compromise without the consent of the reinsurer.

(d) Rights of original insured.

The ordinary contract of reinsurance is only between the original insurer and the reinsurer. The original insured has no such interest therein as will entitle him to proceed directly against the reinsurer.

Strong v. Phoenix Ins. Co., 62 Mo. 289, 21 Am. Rep. 417; Carrington v. Commercial Fire & Marine Ins. Co., 14 N. Y. Super. Ct. 152; Delaware Ins. Co. v. Quaker City Ins. Co., 3 Grant, Cas. (Pa.) 71.

The theory of reinsurance is that, when reinsurance is made, it should be made in the name of and for the benefit of the company, and not of individual policy holders (Casserly v. Manners, 48 How. Prac. [N. Y.] 219). Consequently the contract of reinsurance inures to the benefit of all creditors of the original insurer, and the policy holder has no equitable lien on the proceeds.

Herckenrath v. American Mut. Ins. Co., 3 Barb. Ch. (N. Y.) 63; Blackstone v. Alemannia Fire Ins. Co., 56 N. Y. 104; Consolidated Real Estate & Fire Ins. Co. of Baltimore v. Cashow, 41 Md. 59; Appeal of Goodrich, 109 Pa. 523, 2 Atl. 209.

But if the contract of reinsurance includes a promise to assume and pay the losses of policy holders, actions, in case of loss, may be brought by them upon such promise directly against the reinsurer (Barnes v. Hekla Fire Ins. Co., 56 Minn. 38, 57 N. W. 314, 45 Am. St. Rep. 438). So, where a foreign insurance company sells its business in the United States to a domestic company, in consideration of which the latter "reinsures" the foreign company's

risks, and agrees to pay all the losses arising under its policies, a policy holder in the foreign company may sue the domestic company on his policy (Johannes v. Phenix Ins. Co., 66 Wis. 50, 27 N. W. 414, 57 Am. Rep. 249). In Shoaf v. Palatine Ins. Co., 127 N. C. 308, 37 S. E. 451, 80 Am. St. Rep. 804, it appeared that an insurance company contracted for reinsurance with another company, by which the reinsurer expressly assumed all liabilities under outstanding policies, but agreed to pay the reinsured company only after claims had been duly proved in an action against it. The reinsurer also agreed, in the event of such litigation, to defend the same, and pay all costs and expenses incident thereto. It was held that one who held a policy in the reinsured company when the contract of reinsurance was made was not required to sue the reinsured company before he could maintain a suit against the reinsurer on the contract of reinsurance to recover a loss on his property covered by his policy, though he was not a party to, nor in privity with, the contract of reinsurance.

A contract of a company to pay losses under policies issued by another company as promptly as losses under its own policies is not a contract of reinsurance, under Civ. Code, § 2646 et seq., and hence the company is directly liable to the insured. Whitney v. American Ins. Co. (Cal.) 56 Pac. 50.

In Hoffman v. North British & Mercantile Ins. Co., 35 Misc. Rep. 40, 70 N. Y. Supp. 106, the right of the policy holder to proceed against the reinsuring company was denied because the contract of reinsurance had not been perfected.

On the insolvency of the T. Ins. Co., by which plaintiffs were insured, defendant company contracted with the T. Co. for a certain consideration to assume the T. Co.'s fire risks not otherwise reinsured from a certain date. The contract required other payments from the T. Co. to be made at dates specified, and declared that it should be null and void unless the payments were made, and also that it was a temporary agreement, to be replaced by a final contract of like terms and conditions when the total amount due under the schedules could be ascertained. Defendant thereafter notified the T. Co.'s agents of such assumption, and received from it all of its assets, and thereafter proceeded to collect premiums and adjust losses under policies so assumed. It was held that defendant, having taken all of the T. Co.'s assets, and thereby rendered it permanently insolvent, could not relieve itself from liability on the T. Co.'s policies by subsequently declaring the contract of assumption void for the T. Co.'s failure to pay subsequent installments thereunder as required. Ruohs v. Traders' Fire Ins. Co., 78 S. W. 85, 111 Tenn. 405, 102 Am. St. Rep. 790.

XXX. SPECIAL MATTERS RELATING TO THE REMEDY.

1. Jurisdiction and venue.

(a) Jurisdiction in general.

(b) Stipulations limiting place of bringing suit.

(c) Charter provisions limiting place of bringing sult.

(d) Venue.

2. Limitation of actions.

(a) Premature action.

(b) Same-Waiver.

(c) Same Pleading and practice.

(d) Statute of limitations.

(e) Validity of provision in policy.

(f) Operation and effect of provision.

(g) Computation of time.

(h) Commencement of action.

(i) Same-Discontinuance of action, dismissal, or nonsuit.

(j) Same Nature of proceedings.

(k) Waiver and estoppel.

(1) Pleading and practice.

3. Process.

(a) Place of service.

(b) Persons on whom service may be made.

(c) Solicitors of insurance.

(d) Reception of premiums as affecting character of agency.

(e) Service after cessation of agency.

(f) Service on state auditor, insurance commissioner, etc.

(g) What constitutes "doing business" in the state so as to justify sub

stituted service.

(h) Effect of withdrawal from state.

(1) Mode of service.

1. JURISDICTION AND VENUE.

(a) Jurisdiction in general.

(b) Stipulations limiting place of bringing suit.

(c) Charter provisions limiting place of bringing suit.

(d) Venue.

(a) Jurisdiction in general.

In the absence of statutory regulation, the right of action on an insurance policy is transitory, authorizing an action against the insurer in any jurisdiction where process can be served.

Mohr & Mohr Distilling Co. v. Insurance Cos. (C. C.) 12 Fed. 474; Insurance Co. of North America v. McLimans, 28 Neb. 653, 44 N. W.

991; Northwestern Mut. Life Ins. Co. v. Lowery, 20 S. W. 607, 14 Ky. Law Rep. 600; Johnston v. Trade Ins. Co., 132 Mass. 432; Equity Life Ass'n v. Gammon, 119 Ga. 271, 46 S. E. 100.

Hence in an action on a policy it is not necessary to allege where it was made (Lauer v. Equitable Life Assur. Soc., 8 Ohio N. P. 117, 10 Ohio S. & C. P. Dec. 397). Nor does it alter the case that the policy sued on is a benefit certificate (Perrine v. Knights Templars & Masons' Life Indemnity Co. [Neb.] 98 N. W. 841).

In line with the above, the New York courts hold that a foreign beneficial life association doing business in New York by permission, on condition of holding itself subject to process of the local courts, cannot escape the jurisdiction of such courts by pleading that the contract, applied for and issued through a New York agent, was made and delivered at the home office, when sued by a resident of a third state (O'Neill v. Massachusetts Ben. Ass'n, 63 Hun, 292, 18 N. Y. Supp. 22).

Under a statute1 professing to extend the remedy against foreign insurance companies and allowing suits to be brought against them on any contract made or delivered within the state, an action may be maintained in New York against a foreign insurance company on a policy actually handed to insured within the state by an agent of the company (Burns v. Provincial Ins. Co., 35 Barb. [N. Y.] 525, 13 Abb. Prac. 425). And the Iowa court has held that an action may be maintained in North Dakota on an accident policy made to plaintiff when a resident of the state, though not a resident at the time of suit, and though the accident under which the claim under the policy accrued happened in another state (Green v. Equitable Mut. Life & Endowment Ass'n of Waterloo, 105 Iowa, 628, 75 N. W. 635).

In a number of states it is provided by statute that an action may be maintained against a foreign corporation on a cause of action arising within the state. Under such a provision, failure to pay a loss payable within the state creates a cause of action arising within the state.

Carpenter v. American Acc. Co., 46 S. C. 541, 24 S. E. 500; Griesa v. Massachusetts Ben. Ass'n, 60 Hun, 581, 15 N. Y. Supp. 71, affirmed 133 N. Y. 619, 30 N. E. 1146; Curnow v. Phoenix Ins. Co., 37 S. C. 406, 16 S. E. 132, 34 Am. St. Rep. 766; Lafayette Ins. Co. v. French, 18 How. 404, 15 L. Ed. 451.

1 Acts N. Y. 1849, c. 107.

2 N. Y. Code Civ. Proc. § 1780; Acts

Md. 1868, c. 471, § 211 (Pub. Gen. Laws 1904, art. 23, § 411); Code S. C. § 423.

And the fact that the company has withdrawn from the state and ceased to do business there will not affect the principle (Ben Franklin Ins. Co. v. Gillett, 54 Md. 212). But where the rules of a foreign mutual benefit association required proof of death claims to be made at the home office, whereupon an assessment would be levied, and the claim paid there, the cause of action was held not to arise within the state (Rodgers v. Mutual Endowment Assessment Ass'n, 17 S. C. 406).

The Georgia court has held, however, in Bawknight v. Liverpool & London & Globe Ins. Co., 55 Ga. 194, that it had no jurisdiction of an action in personam against a foreign insurance company on a judgment recovered in another state, though it would be otherwise if the action had been on a contract made in the state. The court suggested that an action in rem by attachment or garnishment would lie to reach assets within the state.

Courts of equity will only assume jurisdiction of an action on an insurance policy where some special relief is asked, in addition to a money judgment, which will bring the case within some of the recognized heads of equity jurisdiction.

Western Assur. Co. v. McAlpin, 23 Ind. App. 220, 55 N. E. 119, 77 Am. St. Rep. 423 (specific performance of an oral contract to insure); Fuller v. Detroit Fire & Marine Ins. Co. (C. C.) 36 Fed. 469, 1 L. R. A. 801 (apportionment of single loss among several companies on different policies); Blair v. Supreme Council, A. L. of H., 208 Pa. 262, 57 Atl. 564, 101 Am. St. Rep. 934 (bill for cancellation of previous accord and satisfaction, and involving an examination of the condition of a fund în the defendant's hands).

A contract of marine insurance is held to be a maritime contract within admiralty jurisdiction, though not exclusively within the jurisdiction of the federal courts (New England Mut. Marine Ins. Co. v. Dunham, 11 Wall. 1, 20 L. Ed. 90). The federal court, sitting in admiralty, also (in Slocum v. Western Assur. Co. [D. C.] 42 Fed. 235) took jurisdiction of an action on a policy of marine insurance issued in a foreign country to American citizens, and through American brokers, on freight on a United States vessel between South American ports.

Under a state statute permitting a single suit against several insurance companies under several policies, the federal circuit court has no jurisdiction unless the alleged liability of each defendant is over $2,000, their liability being several, and not joint. (Wisconsin Cent. Ry. Co. v. Phoenix Ins. Co. [C. C.] 123 Fed. 989).