No. California's law is perfectly fine. Selling insurance is not 'interstate commerce' like selling goods across state lines. It’s just a local agreement. Since it's a local activity, California has the power to set the rules and punish people like Hooper who break them within the state. It doesn't matter if it's insurance for a ship or a house; the rule is the same.

Yes. This law is unfair and unconstitutional. It violates people's freedom to do business. Mott should be free to buy insurance from any company he wants, even one in another state. Hooper was just doing his job by helping him. California is overstepping its bounds by making it a crime for someone to help a resident get insurance from a company that simply chose not to open an office there.

No, a marine insurance contract is not interstate commerce, so California can regulate it. Insurance contracts are personal agreements, not products that are bought and sold across state lines. They only take effect when delivered, making them local matters subject to state law. California has the power to control out-of-state companies doing business in the state and can make them meet conditions like posting a bond. The Court also says laws should be interpreted in a way that avoids making them unconstitutional if reasonably possible. I conclude that the California law is a valid use of the state's power over out-of-state companies and insurance contracts. It doesn't violate the rights of California residents or people from other states who want to get insurance from unlicensed out-of-state companies, because the state can set conditions on those companies doing business in its territory.

I disagree because I think the California law, in this case, wrongly interferes with the freedom of both Mr. Mott and Mr. Hooper, and limits the rights of citizens from other states who helped get the insurance policy. Johnson & Higgins should be able to work as insurance brokers in California through an agent, just as they do in New York, as long as they follow reasonable rules that don't violate their basic rights. The state can't stop its residents from getting insurance from an out-of-state company that isn't planning to operate in the state, either directly or through an agent. Mr. Mott had a right to choose an insurance company without an agent in California, and interfering with his choice violates his liberty. The law makes something a crime that Mr. Mott could legally do himself. Neither Johnson & Higgins nor Mr. Hooper were acting as agents of the insurance company, but rather as agents of Mr. Mott. The state's power to exclude out-of-state companies doing business through agents can't be used in a way that harms the constitutional rights of its own residents or citizens of other states.

—every reasonable construction must be resorted to in order to save a statute from unconstitutionality

The starting point for analysis must be fealty to the precept that congressional statutes are presumed to be constitutional.

"The principle that the right of a foreign corporation to engage in business within a State other than that of its creation, depends solely upon the will of such other State, has been long settled,..."

—deciding that States could regulate the marine insurance business the same as they could regulate other kinds of insurance businesses.[23]

From the 1860s through the 1940s, the United States Supreme Court consistently held that the business of insurance could be freely regulated by the states because insurance was not considered to be "interstate commerce."

Before striking a statute as impermissibly vague, a court should consider "whether the prescription [of the statute] is amenable to a limiting construction."

"If the power to regulate interstate commerce applied to all the incidents to which said commerce might give rise and to all contracts which might be made in the course of its transaction, that power would embrace the entire sphere of mercantile activity in any way connected with trade between the States; and would exclude State control over many contracts purely …

No. The state statute does not violate the Commerce Clause because the business of insurance is not interstate commerce. The court's precedent, beginning with Paul v. Virginia, firmly establishes that issuing a policy of insurance is not a transaction of commerce. Insurance policies are local personal contracts of indemnity, not commodities to be shipped or traded between states. The state's power to exclude foreign corporations from doing business within its territory includes the lesser power to impose conditions on their entry and to regulate all insurance-related activities occurring within the state. The fact that this was a marine insurance policy does not distinguish it from fire insurance in a constitutional sense, as both are simply contracts and not instrumentalities of commerce. The Fourteenth Amendment does not guarantee a citizen the right to make a contract within their state that the state has constitutionally forbidden.

Yes. The California statute is an unconstitutional interference with the liberty of contract and the right to pursue a lawful calling, protected by the Fourteenth Amendment. The statute illegally infringes on the right of a California resident, Mott, to secure insurance from any company he chooses, and the right of the New York brokers, Johnson & Higgins, to conduct their legitimate business in California through their agent, Hooper. The dissent argues that the insurance company in question only engaged in a single transaction and was not 'proposing to transact business' in California, making the state's regulatory scheme inapplicable. A state cannot make it a crime for one person to procure a contract for another that the latter could have lawfully procured for himself, for instance, by mail.

No, a contract for marine insurance does not constitute interstate commerce and is therefore not beyond the reach of state authority because insurance contracts, whether against fire or marine perils, are not articles of commerce. They are personal contracts and do not take effect until delivered, making them local transactions governed by local law. The State of California has the power to regulate foreign corporations within its territory and can enforce conditions for doing business, including the requirement for foreign insurance companies to file a bond before transacting business within the state. Moreover, the Court emphasizes that every reasonable construction must be resorted to in order to save a statute from unconstitutionality, and that before striking a statute as impermissibly vague, a court should consider whether the prescription is amenable to a limiting construction. I hold that the California statute is a valid exercise of the state's power to regulate foreign corporations and insurance contracts within its borders. The statute does not violate the constitutional rights of California residents or citizens of other states who wish to procure insurance from foreign companies not licensed in California, because the state has the authority to set conditions on foreign corporations doing business within its jurisdiction.

I dissent because in my view, the California statute, as applied to this case, is an illegal interference with the liberty of both Mott and Hooper, as well as an abridgment of the privileges, not of a foreign corporation, but of individual citizens of other states through whom the policy was obtained. Johnson & Higgins have a right to pursue their lawful calling as insurance brokers in California by agent, just as they do in New York, subject only to reasonable regulations that do not violate their essential rights. The state cannot prohibit its residents from obtaining insurance from a foreign corporation that does not propose to do business in the state, either directly or through an agent. Mott had a right to prefer insurance in a company with no agent in California, and any interference with his choice infringes on his liberty. The statute criminalizes an act that Mott could lawfully do himself. Neither Johnson & Higgins nor Hooper acted as agents of the insurance company, but rather as agents of Mott. The state's power to exclude foreign corporations doing business by agents cannot be exerted to impair the constitutional rights of its own people or citizens of other states.

Hooper v. California

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