OFFlCE OF THE AmORNEY GENERAL OF TEXAR
AUSTIN
Bomrebla 0. P. Lookhe&, Chelraen
Bmr4 of Insurama ComxdMlOnerP
Austin, Texae
Dear Slrt
Your letter re nlan of thlr 4rgmtmont
:i>ltnl Ohall take
over and perform all fWtiOA0 formerly .
porformad by the Syetera and enJoy all
bonosita aad -prlviloges formarly enjoyed.
by tho Systam, and .shall malcoall ool-
lsotiona thereartsr from the mtunbaro.and
ratoln 100s of same QB 1ts OWA. The
Spat-amagrses.to m&intain a total member-
ship at each hospital of not lees than
4,000.or nolo than 5,500, and IS the mern-
barehlp falls below the miA.li%mor exoaade
'tha maximum,'it coaatitutss a violation ,,,, ~,
for which the hospital may take ovoti aa
above ~iAdiOUt6a. The System wdgaboth.
,-&oup~ aAd’indivlaua1 bueinosa.
group ha0 em msny cm ten members, pr6mlUatii
can be pald.monthlyg whareaa indl?iduals
may pay onl;rr on the quarterly sami-annual;
or annual basis. ,Ths aee limit ~:a from
16 to 50 yeara, and the annual pramium ir '.
#Q,.OOpar member for,all.ages.
Wcithgr of th'c hoa~ltals has oompllod,
or ado any attempt to oomply, with any oi
the provisions of Article 4590% or of
Title 78, nor has the NRtlonal’ Hoapitollla- ”
tiOA 84rJt03lb,
ti0 .v and none of the threa
corporations of any of their cmployass
has been 1iOaAaad by thle Dapsrtment to
conduot aA ilWAl?QA~~business-or .%he
business of aa insurance a&en%* ,..
-It ia our opinion that eaoh of the
hoepltala, severally, and its etipfoyees,
is oarrping on the bwina%o of group an&
Honorable 0. P. Lookhart, Page 5
lndivldual~hoapitallzatIon lnsurenoa, lu
ViO~~tiOA of the Statutes of the Btats;
and .that the Eiatloqal Hospltallzation
system, Ino., ia engaged in euch hospi-
talization iASlU%AO~buslnaaa jOiAtly
ulth the raepeotlvo hoapltnle in viola-
tion ,oS auoh atatutoa, or that it an& ..
1ts:amployee~ end the cmployoaa of the
hoaj1taJ.q nro aotlng aa ineurnnce agents. ,-
,(loC&L.zaoordlng yenta and/or sollolton) .’
in i@olatloa~oi the terme of our otat-
utos;.whloh npoolfloally forbid oorpora& :
tlons frim belly lioensod as lnsuranoa .. . i
ageate.,
9% suggtdt that you cowlder what
beorlng, if any,~ the following statutory ..
provisions,. amox& othera, h%ue upon our
qUsstlonat- Artlolee 459Oa, 4686, 4716,
5055, 5056, 5058;' 5060, 5OCEa, 5ObEb. ana.~
506Bb.
*Aside irom the question oiwhather
these .three _oorporatlqns and~thelr. employaes
tme unlawfully operating an lneuranoe busi-
ness or ths buslnens of lnsuranoe asante,
it 1s our flaw .also that eaoh of then oorpolra-
tlone~la~aotlng ultra tires, uo ab to Justify
appropriate quo warranto, lnfunotlon, or
other prooeedings agalnet.them.
We are aubnittlng herewith in support
of our views a brief, whloh, whlla~oot 8x1 I
haustive, may be’helptul. /
,.. : d
*Plea80 rrao.ise”~:uus~-~ethar’
or nit,’ in
your oplnlon;‘$ho &kit& ot faote above duty
lined discloses ,any vl,ol.atlon of our laws, . ”
elthor civil or griminal, or any ultra rlrsr
act on the ppnrt of. a&l or’any gf the three
corporationa above' named..
.
“If your anf~ner ie la the afflrmatlvs
wo request, pursuant to ‘the statutes, that
you institute suoh proooealnm as may be
justlrled,, and thla Department tendorr to
you its oooperation in every pos,8lble way
in OO~~~OtiOA~therWlith.~ ' : .. ,~
\
Honox%blii 0,&p. Lookhart,, Page.~7 .. .,
.. ~. me -tara Wlnnuran~e~~,i? qefined.ln Corpus furl*,
vq; 32,,~3. ,979, .8820il0prw ~.~. ,. . :. ,_ .,,. .~i _., .,
. .:..
*13r0eulydQrin9dt insrirtice~~is a. oontr~ct ~:,:.. ..
*,by whfoh’~one party; for a ooapinsntioh ,oalle.ed.
-‘thy prami’aq assum% lprtioulhr:ri8kri-of ths, ,. _. ; . . .
othm party and promiaoSto.,jap to himor-hio
notineo a certain or aaoortainabl+isiimof -. ..' T .
Eonap'oa.8.speolflsd..~~ntlngo~oy; Au rogardm
"; propsrty~cna~llabllity~fnauronoe, it is a : :..- : -(
oontract by -6hlch one party protiiaoo. D;na; :-: ..: :;.1'.‘
oonsldoretion to oonpensate or relrcbursa .tha :. ; '!..
other if ha shall aufrar.loas rr0a~a speoi- :‘.:.. .:..
fled oau~e; or to warant& dr in@mnify or '. ~.. . ;
SOCUT hi12 n&A!& iOSS rrOid~'thht'ObS4~ '~.:, '... .,.:., .
h"~thsom axoegtions, particularly In the
oaae ot~~.ire.i~ur~~e,,lnsuranoe 1s a~aon- : :':. . ,
T&r.tsm 1fmlrnIl~e ,dI3i -’ .i.’ :. :. ; /
tmat orfiadamnityJ :
.not.ee also the aot or iniiurlngbf the’oontraot ‘. ;l
hore d&hod, as well as the eyetoq oi buel- /
neae of which such oontraets 1~x0ths Bbar- '. -;. :. .;:
aoterletio and vital aloment.". ._ i
.,( ; .
Couch on fnsurfmos, Vol. 1, 690. 2,.,,p. 9, d&a& i ,_
the word winsuranoe~ aa folrowar
.’
.... _. -* . : Strlotly derh0d; insuranai) .‘.
.j ‘.~;:..:
. Is a contraat whereby one ror a oou- 1.:. :
k&ration .agraes to Andemnify another for
llabllltg, donnge, or loso -by perils to whioh ...,'
. the subjoat~lnsured.may be exposed.. In *'. ..~'.'.
acolbmt inourance’ it 1s the . . hmlth of
the person that la the subject of i;he.oontraot,.
It aleo boo boon sald t&t *the word .~
~l&aaoe*~ in Boamoo speech and til.th~groprlet~y~.~.'..
la uosd quite as’ortbn in. the se586 or oontraot
or inaranoe, or act 0r i~~urlng, ae'ili that. 's'.
expreoeing the sbotroot, idea oi,,lndemal~y or
seourity ag,alnst lons**~
1
-. . .. In this oonnoction it khould be ~. ’ ~“.
kmberod tbat ths oheraoter Or lnsuranoo ii3. 'I .
not Do be datermind by the charooter of the ;-:
ooEipanf writI&& It, the nomenclature mod, oc
the mnnfu3r or mda or errordingloeurande, butby
ths nature of the oontraot aotually entered
into or iseued. In other words, the true
oharaotar .of 80 alleged oootraot of inrmraaoe
oamot ba.ocaoaalod OF ohsn&by the uao
or crb~aaOeor worba, it be:n(S. imn5t@ri5lwhgr
ttier or aot the oontroot on ltu faOe purports
t0 bs 038 0r m~rr0n00, oifiop th0 00tu-t win
look bnhlnd the tarninology to e@c@rtal5 What
the parties lateaUe6 to aoaampllah.w
Artiola 439Oa, ~vrnanlm Aanotsted Clvll Statutes
euthorhxl the OrgUdmatibn and.lncorporctloa 0% non-prod
oor~~orrtlone ror group houg2tsl sorvloa. rC@ aot iurthor
provldos~in pnrtt’,
That such oorpmtiona'or~nltod
and o&itid under tha ~rbvl~lixt@ or tbts
Aat o~!slX not be ray.ilred by any dopurtzmnt i
of this Btntb to lost bead, o’e pI;rlgoe
dapmltr
wiIScbany depsrtnart of this hut$ tti bagin
at/or oporatb unaa2 thlo Aot and the prool-
elono vi Title 78 of the tiavlosd Civil Stat-,
utas or Toxea or lQe6, ore bsrebp Prrolarad
inspp3lloeble.t? cor~omt1ozm ar#mlrt~U and/or,
oporaced under this &tP
Ibwover, auOh oori;ort&tian@ air@ nubJoct to oo&,ala
aujmrvision of the Xaturhqea 33opmm3nt or thl9 mbto. unaer
tha rm8 otatod in yourletter, nom or t&e above ment1oaea
oorgoratitna are incorpomtod umI*r krttolo #$Oa, nqpr8, w
as0 attcgtiat; to opimm ~1140~ounh statute.
. . .
*It lo elwmntary, 5140, that 155umno0,
0thiw t&n'5 thnt or life ana aoaia.f45twhore thr. .
result 15 de+th, ie a oontrsot Of indeml.tpg
anP thi5,rsg"rdhm Of th0 fuCucJtttrat t&O Bum
t0 bS pia $a Q,$208a UiTJOO ia ~QdVatlQOrw (Cite
iag ii0uthwoat iistional SCU*& \r. 23sployvri3 Xn-
dvmn~ty Corp., 12 i3. 7:. (2dl lt39, 1913 Fire
hsmoirition of I?hilaQ@lphla v* fhtiyhmi, all
c. fi'. 447: jl)olnwarQlf~un!lnce co. v* txll,
1r7 8. W. Pas.)
You hr*va.furniah@d u5 witk 6 oopp oi tb applioablon
and narvlco ooatraoO oasd by t&s fL*tthodlat Boe3ltal~ of DalIam,
Tamu, ana state in oflteot tbst the itp~llcr~cloas aad rmvlo~
42$l
.
EcqOr5bl4 0. 3. Lookhart, a@$. 0
oan?xaotr used by both or the a.bwa narrad hospita1.r aro ldon-
~-t&xi& enaept 58 t4 the mm44 0r mpplioants, and OS oour40,
the cm4 of the pertiouler boe;ital mnking the 64rvloe con-
trraat is sat forth to. said omtmot~ othsruloe, aa above
stoted, t30 apglioations and sorvfoo oontraoto era the
Bfm4. ?ha a~plleation and ti.4 eorvioe aontreot of tho
Lwhcdlst Eospltal ar Dslfacl, Titxarr, above nontianod, am,
as r011owsr
*; the undare$~aod dn hnmby nrako awli-
cntion ~or~nenbburehi), in’tho Xos~dtallzntlon
pm of tiethouint fioapital 0r Damio, Tonib, 'i
thir:u@ al4 z~ttolml Hon~ltalization :~yntrJ!z,
Inc., the autho,rl@ d&ants and oollmtors-of I
aaoldant, an4 alter rc days rra.3 data or fm-
traot la cam of 1U~~as. Should I ohaqe icy <‘
proeont mployment my nsmbershlp ahall stay ix
full torae 60 lcmg do my &UWJas-4 grid. Umm-
j8loyoU 3&zts or bmabm¶a ti C;roups are written
ozi cwazabnald CU?I buobaa5al aa4 are automtloal-.
ly,ota0ollctd wkan husband 6 oontroct lapaasi
CoatmA or amber who baooaoasumnployed
~OUBC+~~ irsaut0=ntiaaiiy 00~00114d. u4rtiulb.’
in paymoat0r dues ror ten dcya automtloally
onaoel3 thb Sorvlao Contraot I am to reooivo ii
:\
1
..
4coo~teU; if rsJoctbd, qaxhey apald on bpplloa-
tlon wl1.Z be rsfr;ndix¶. X certify thnt I am, $a
~;;fxudth aad witbrtutohronla ailment of any :
. I understand 63a aam that X on not to
reoei-sa hoapitallzatloa earvioo for any exlat-
lag disoaso, ailaront or injury aor~cmgUoa-
tlwa arielng t)lerafrom nor for tu~erouloeir,
iQtosloatiz?n, i.MPYDU5 dLlorulara, lnbaaitg,
~134r4~1 di8~44, apphiiia, 8ui0ia6i 08958, 0~
ror any c;tmrantinablo Uloecaae~ nor ror Ma-
ewe8 of or crur+$cal oparutloacs r0r mls~oa~riggo,
abortlon, oz troublse srialng ‘rrax tkis BCUPOB,
r.crfor ooqlicntlons uricring rrou jawrinue
Ealircrios: however, a bioaoun$ of l50$ ~11.1 be
allowed aft the roguhn haepltol oher$ee ror a
period o?r twenty-oao daya for auab ail~i9nCa a@
hand?, hmorrhoida, .dirraeoo or operatlon# oa
Ut4lNR, tubad or ovaries ator thhaoontraat haa
beeAiA f&U rOrQ0 $tW 4110@X&r and U>OA 4AtO;c-
SAg the aboon aa6 r0u0es yewh
* to uaauat my due0 e0oh
‘.
ma, ad&rsa or this applialitton
and that any verbfil
; p~otises or rapTt-
WAtatiOA8 W&3 by
eIth%C pwtp ara shore j
mad now wafooil.
Bus. ?bqAs Zen. mume -.. Si@Md iA dupUaats.
.~
n&l day oi
Fiitneso a ---a 194~
.
Bmrable 0. I?. Loomrt, Pa$e 11
“Raaarkar *‘.
..’
I
.
BOFVLQb
Cantrcot:
TlALLbs YI:~I’IEDISTEO51WL
‘.
b?uabsr
l?oc-Tmnof arable i’.
*sLT~vICB
~UO~~CT
*me ~mxmT ~mxx4L:0r &dZae, horalaaftar
deoigmoa a5 '~Ot3~~tfll',.A@rOS acd OOAtractr with
.
rr02d
llor01nartar uoal~natad 66 'ulsbO):' iu oonaldaratlan
of ppmnt 0r duo13in ci,dvanoa~to air duly author
izod apmtfi ‘If;: KZ2ICLtr.LX03iTiMXATXC~i iXCT!&t XETG.,.
iA hStAlbii!lAtS 40 OfJl-60~U>OA WhOAUil;AiIlS A~&-
oatton, to give @aid Yoinbcr the lollowln& Ilo~pltal
EiSFViCS, UPOA CiUthO&YiWZtiOA4f 0Uf.d ]XQGbOf'BdOOtOr,
who aunt bo R nonbsr OS tho IkLlae Count ‘dndtoal
socibty. IA coma ‘of 6izw&pAsy bkmbor pi s 2 bo mm-
Oar434 EiXsi+aid ifli&o &~Or@iuiPyflO~z%AQAt SA&
will ,bs cmroa far until the Idomber’o doctor arrive8.
"!i'h~a S.aVioa *Atithr, ibosibw to a
Co-atraot
prlvtita, or oorai-privuto
roan (1~0s not to 0X000a :
&OO gor Jug), opratlng room, onnuthotlan, aen-
oral -?ursiq, auroing ouporrlolon, taohnlclsno, ~.
Glutltluao, mulll. routine nodicino, aur(;loal
au~pW~e, rcutlna lnboratoxy work, ona all other
uoual hos~ftnl morvlcs during e gerfod Or hoop*- .
talizntfon~not to oraoad twenty-mis hoapltel doya
durfq the ooatxr.ot year, 4mwvor, artor Uasbor
burr unad the f;weuty-41x5 diaya allowfed, in 0680
furthar hospltnliix~fian ia rraooaoary, e 33 l/W
dlcacunt tram regular prloeo wtL1 bo 6lvoa fop
an oddltlannl thirty days. Thio doea NOTin-
oludo dootors* tram, praoarlptlonsnrlttsn by
r.:mtor*ndootor or on MS ordora, nor the rorvlae
or a apeolal pxivata mrue, nor x-rays, owtwn
tnnta, phyalothrrnyy, intmvanhu8 aadloineo
anti-toxlua, *nooiaoo, OortImUo nqr opeolal bbtprw’
tory wot$c.
l3t lr furthor qmod tha8 in b&e OvWt *he
mwnbrr sufrora an aooideat outside or Xhllrr
coouty, Toxee, ana lt lr aoaoemrp to hava
iz~;r?oUintohorrpltull!mtloa, the hoapical a&mar
to rdnburno the nszbar $0 the 4lXtOAtof
VW.
t= 00 p4r sty up0fi r000igt or tpritt0n proof
.
fro: tha hoepital wCnr4 the mttabqr was ooa-
Fijian hOw0V~r, in A0 4tvOAc dOCrIB thb Oh144
oovcr r:ora thnn tho tvmnty-oao (El) horpitnl
Coya all~otnb thr moubar durlrrg eny 011aoonttgat
ycur4
“Ii all the privuts or oaniprivoto room8 of
tho lioi~pital are oaou~l4cl 4t tha tiso timber
13 oztarad (ro a patlent, thou Sxaber oaroos to
lo ;~leoud telporsrily in(L r9oa Of ditforont
01333 until such rooa lr avellablo. Eombm
a&~ooe to be aovt\dat tho ojbtionOS the t!oepl-
tsl. IT tho kw~bor ia furalehad a aamlprtvatr
(two or,thros bade) room the tarmn of this
oontraot nro thornby ant&Sod. Mwxber la
eubjmiti to regular ohorgra in ttifaliorp~tnl rftnr
MS doctor hak filvnn 8n atdrr for hir di~MWy$r
frm the Ito8~ft~al. yor 4~11ohnr*a* mnO*b
the tloopitnl fcr.asrvloe ~(10 oovnrad by thf 8 I
oontruota the Qmbar agrooa td pay tha Iioopital
oaoh UpOU dO3UAd8Ad ir? A0 OVAAtlAt4W tbA
upon maaI& tha SIoopltal. PstlZura to pay
ouoh chargad UPOAOX'before lOJWfA6 t&a &38gi-
tal autorntical~ tsrdAato0 thS8 OftAtiT6IOt a8
of bata of suoh 31sfoult aAa ~111 &#a8 thoreto-
for0 ptria harouuaor ahaiL b* rdtOIiA4a by tho \
Kospital.
ia the
-Dofeult pyiaont of au06i for a
prioa ot Tfi:S.DPr8 auto!zatlocally oaooe~a thlr
oontcsot, without mitton notloo to &mbo,er, oad
* autm rsodvea qftor eaid ton &ya tire eubjaot
to r@jeotfon by the Eoopitel for any raaaon.
314 c;COOptCtAOO by the ilO&Jpital Of B pallt PUO
lnatallmunt ah011 not be oonatdorerb II u~lver
of any of the OOAaitiOJUJOS thlo oontfaot,
"x:0 oorvloe shall
be provided thmb6r for
Q&Y ChrCelO airi4030~4~ &A&WYAAr
QfiiUIAQ
coqdloacfoae ariofqg tharai’rm, avr far tubor-
OUiOll5, iAtO~fOi?St~OA,QWVOUB afSOraaP0~
lcmnlty, vsnercml diooaaes, ayphUlo, auioi-
Gel 06ao0, or any ~quarantla6blo dlrearo~ nor for
Bo;lorable o-. P. LOc@hmt, PnQo 29
di6&~5 arm eu~jic~ op,sratfons fir tliaoar-
r1e~a, gbortitn, or troublatr a&&q froa thir
eouroa, nor for ooapllcntlona arlsiq rm7i
provicus Oalivorloo; hawever, a Clo0ounti OS
50% all1 be nllovmcl oft .th4 ra~uler hospitnt
cliar~m for e psrlod of twontp-on0 dtiyu for
RUiJheilmmte as homle, hsaorrhoide, dio~~38
or operations on the utorue, ~lniboa or ovmlor
after .tho CuntraOt baa IWW 1~ mll fOrO9 SOE
ORB year @Ad U$On entOrb& tha ~etKWdaR&
fOllow1~ yamxh
and flftpfivo are aooeptabla BEImmbera. !Fhi8 1.
Contraat in oubjtot.to OtlAOillb3tiOAwhen the
holder reaohca the egaof ufrty y064~8~ l&or
doppndont abfldrea under olttstn 9eese of age'
6re e;ltitltd to P 90$~ctLsaount rr03 ths m&Llar
::oa,"itel~c.hare;zrs, g?ooLQ@d .bdth partntm we
ncdwro iq cbod stabiliny: aaC pr3vICsd fbrthiti
thet their oames and agee era lloted on the
applioation gf khoir ~sirsnt8. .' :
"Aup %?aeberarho mikea fealee nMtssents'c&
&rCing hl5 0.F her health Qr age kt ti3\0 Of,.
ai#iinfiapgloistlon all1 not be ttititlsdto ,.
hOt3pfteliZatiOA tulctrtbla aon$eaat, The upgli-
oation whlah %wiber’ is a part,of, ax& ia
aigrrr,
the basis Sor, iaeuanoe of thie owitraoti,
‘In’o~ab of epiOe&o, publlo dtotqtar or ‘_
other OoAditioAe aa~aolng an ovararowdln& of the
cepaclty or the lmJIo~dlQt ~ios,?lt01 Of lm.lAxJsto
auoh a depoa t&t it la uot ;roaslbletb.pro-
vi&s eaoo~a.Iocatioua, in ouoh want tha UWloUlot
8bs~itoi Of %lh'isl a@%@8 t0 rtbtuld hriW# t&O
833mxt of Uu~a,. reooiv~d f*aa Jlrtwbor .Qurbg ** 1.
‘i3onorablo 0. El. Loa&trt, irage 14
nmlva Liontha lsnwdisroly piaasdixq8 end litoh
rn~ud 5h211 fully d~leahur;;atha rvoponslhlity ‘:
ol tho 22otbtiipt Hoa,-.itaf
OS PaUeo. *
uThla aontroot doaa not a;!;?ly to iadwtrial
haztdda aoalag untlor tho supmvisfon of the
tidiStr;h~ ACOiiont 3onrd. &EbW O$reeO tO
yay the balunae of the yearly duoa ?hhoAEd"JittOb
to tha !im~ltal. It 1s r;sqtilred that Saber
leave t:;is Cmtraot et the l&itt~ Cifiao
wiifle oorSLnad, Corm-eat ~111 be rat’sme u>oo’
dlsohsrijo.
By.' :
(SW&) YU~~%rlnt&Ad%Rt*
'(Gn the rovorii&ds af'the Oc+'adt): : '
:
aI, eho ua94miggad;do k&&y w&e opgl-.
cation for mmb4mN.p in tha.hoapLtel.izatlon plan ...
or Uithcalat Ifosvital of ~Zallna, Toxea, throw&
t.L3 <icnal llospft~nllaa~tlon 3ystea, ~ILlO., the '. :
aut~ori",sd~4~6Rtd,e~d ooll4ctwa~g~ auea, pcry-
at the rate oft 75g xonthly~ c
x&w-tnrlya $&CO ~itzuipi-~~ually~- $9.00
the mnb?irah2$ to booma operai%ve
i.mxdlatolp la CJIM OS aacldenti
~2ndart0r 10 day8 from ant6 of contnot ta am4 !,
!
of illnsstr. .Bhotid I chmse metpmasent employ-
muat my aornbbraDl~.sh~U'gtaj.:ih full~f0~&,-4~ low :L
as l%ydues or0 p&J. .ilriStZplOyQd Wi?(bS Of hU6- t
bums 1~ &roup are wrlttsc on sari% bosla 66 htls- !’
bands, UC:Qcm cautozmtibal2p cnnasl~ed whm bus- :
bmdta'ooctract la~04s. Contrs.ot ot rider who.
bacoaos unmiployed houaowifs i? autonutloaily
cacaollad. 3aTault in gs;Jr;;aAt Of duas fm tea _.
days autoM&allY aanaula tL1w0 Liarvia Contrwt
Itin to moolvo if aocepted~ if rojeated, mtay
p2ld on oppliaatioa will bo sofundsd. I oertify
t&t I BP ia good hesrlth and wlthaut ohronlo
oflzant ~of any Icind.. I undorataad awl ogroa
ttict r R3Jnot
..- to recaiva
__ kOS~it?X1iZ~t+X3
.- aervlo*
. for any 4xlstmG 416oaao. alUmat or indury ROT
coqllontlocs ari5i~,tharef+rc;n, mr for tubor-
aulosla, lntoxloatim, a~r~ow dioor&wa, ln-
oanlty, vsceraal diSetMMr, 0 hilb; euioidal
oafms, or any q~rant+ssbie 4
0% oaaq aor for
Xoaorabla 0. P. &ookhort, Pa&cl10
4loaasos of or surg;loal opwntlons for nis-
currlago, abort&a, or troubles tirLsh& frejl
this sourc0, nor for cv*plicilt.ione orh3ing
frox ~rcrvl~ua d~olivcrlae; hoc&or, e dicoount . . ..
or 5oi; wlU,brr allqmd. 0rr the r3wla.t hoopi-
tal c!:br~?afor u poflo6 of tnonty-0no days
Sor.auch a1lmont.o us bornio,; hormorrholda,
diaueooo or oparttloae on the uforw, tube4
or ovarlos attrr'tha aontmot ho6 bsen in
lull for00 for on4 yasr ana u;loa ontoring
the eoooad end following youral
AgO m Duta of lnot fllLlq3P 194' l?~turo
Attondl~~' phyololsn Reforenas
xho oan vorlry zy tHMma4nto. I fully undnrotonQ
t&t any false atmtenonts r?qrding my hoa~lth will
not ontitlo ce to monbarohip. This a~plioatlon
bocomea a part of the Eorvicr Contraot en6 18 the
basis OGwhloh' it 1s lfitiued.
I iuthortas~ e!I'4.drduot q, duea saoh
month.
:_..I, Xtngloyed by '- j
; orwifoof~ . )
Xitnea5:
._: .kime (print).
P.m. bbdrera
i;apr,aaaatutivo -.
&f&a p&oAO-. Ron, ?hone ~
The UGdOrsiF~Oa&is read and fully uiidaretanils
the aontonte of this appllO6tlcat and that any r*rbal
prixlso4 or rspresontatlons afi5e by olthor party
ora. hwe and now *iaived. &$Gad ia~Guplloets. tail8
44~ 0r~ , 194-.
.
,Frm the faoitti otnted Ln yaur izrqulry, and frol the
cxMcatin~ on4 84rvlas.oontrnot baead thereon, It is oppwent
tht Ch4 ~~6814GOO Or the @bOVO ?nonttQlird boagLt~lloet&n stoheine~
4
1.9 t0 :GbilG~~,: iA QWt, t&: ~OGlb~rS. 6f&GSt OZQWS8iVO OOat
of hotQlt4liZatloA ocnti~snoitts~ Ao'~la fho iwtr,,,oi burial
. .
. .. 'Y'
.
-,_
435
I I
R0~0~iblo 0. P. Lookhart, Pa&B i8
aodoolstions %~h:hare
ths runera beGa%ito nre contraatsd to
bo furnfshod in klad end not piid ln eaah, the bonaflta
bore ore unoccdltior*ally contmotod to br dltbar furnlsbsd
In k?nd tlrou& &oepltrQ servioos and oeaomodutlom or,
is tha <arnatlvcr.,~l:lo ot\rtci.a l~t~IWae.b~8adup0a OOA-
tln:;;cnclos, the q,m~li ‘ihi tho fiooidtal amoe that their
opticn to rd%nd to the mdmr 113UUQUof uuoh usrvlooe
8 aacv lo c&ah equivalent td double ttia aUiOU&of duea paid
for tbo first 12 nonths period. ih tba e4nlas oontraot
of both bos~ltam, it’is providodr
I
*. . . tbht in thu 4VeAt the txmbbor
iwXsro tinacaldvnt ououfdu of &illaa County, : ,,
hmz,~titb It la tooa~imry to Zriiw i>zaiediato ., 3
hoo;j&xlizntion, the ftoopitol aveer to re- ;;
Imburao t&a wmbsr.to the extant or $5.00 per
day upm rscoipt of writton aroof from the
boaphtal. wkero tha m&or MB ooilPinob$ how-
Qvor, in co event dose this olause oover more
than t&o tW@Aty+OGo(21) hor2itaf dayo allot-.
IS%ths aorabbr4urlag any on4 oontraot yoq.4
x6 quota rrom 03 A. &.~ R. Pi5 fie, follower
*hother Or not ~A.MWOCtfStiDAOr OOt- I
p0rstlon ia oatrying w tm Inaum~oo bunlnorus
rx!nt be d4t4miaad by rha pnrtiaulcr Gbjaots
tvhlch it ham in'?ii-ias,an& not by hbstreot de-
clnretlonsof la general par:wto to do rote of 1, ~:
charity,/80 that, although fha obert4.r of a
oorporatior deolaraa that fto objwt 1s ‘the
t;ocwal goob, aad sot indIoiCw1 grofit,*.lt
my ba daclnred to twctn fnsrurfmoci Qmmnp. i
And, OS oourse,.Ehtt GIGMby whiah a crozww.Lnp or ,’
.asscclatlon,or ite osrtlfiaatas or goliolso,
1s Coolgmte~ io not rI&-ominMilvo of the
queofion whelkor thci ar;rarrlmM,tn ia &A IA-
3urmaa4 oozlpuly or ito ountrcxotsare in fla .~
ncturo OS In~urhsm aoliciea. (Citing Scatbarn
Suratp Coqsmy v* id.wtia, 21 lie X. (8%) 774).
It is k%lkator5e;1 that t30 term 'fArlirance!'
nodiero a~g~oero ii% the oontreOt. *id tha tsrm
MG WUP, of payzerrt, of the oooeldorGtioA QfO
not f!itJtloxafAGtivtoof fb, puoation whothdr the
contract Is 008 it Ineuraaoa. @ awy ba ob-
aorved. al?m, that th@ quastlm %s tie the
#,
!
Bonorable 0. 2. Lookhnrt, Page 17
nature ofthe insuratIoe proeentsd by ein in-
nurunse contrRct la Aot to be rettled by tba
nctura ona or~anlzatlm OS the aesoalatlon,
but: rut!& by the tsrme snd ohamatar of tho
contraat ltsolfrn
Tba two abovs msntionad hoopltnla Rro lnoorpomted
tm ckorltablo a126beAWOkit oorpomtlcne, and uro a4twilXy
sng;aEod ia the lnrumaacl bualaooa and for profit. ';2ra irot
etctod in rcur l&tar furthor refl.aot tiskt the I)o~WRre
corporation 4bovo montionod is aotiAg 08 UtjeAt $0X the
hOS~it.ale.
No have camfully oonrriderod Title 'It), ~eraon'e
mot&t&d Clvll L'Sxtutos, whloh ocntalns tho rtstutes role
tiva to ~ASUMUCQ :A this %ats. iurtiole 4710, VWAOA*LS
knnotated Civil Statutan, aeftnee a health tnaumnoe 00~
pAyus s0110w5t
*b health imwroaoe aomprmyshall ba deom-
cd to bo B aorporutlan dol.ng businooe Under any
ahertax iavolving t,he pRp!ieAt Of Uny UlGoUAtOf
ClOA6$',Or other thi.ncf Of YClttets,aOAditiOAt3dUPOD
lo&shbmyl;~~oo aP dl.ablUty due to ridmara 01:
010
"An UOOi6~SAt WwaAis oozqany shall be
deem4 to bo.a o~rporntl~oo do%ng~bu~lAsas QA~SC
SAY charter irrVOlVing the p$WHlAtOf SOAOYOX
other thling 4f vslua, OOAditl4Aod upon the iA-
jury, Cisabl43eAt OP death of PomOAS XWitit-
. ing from tmvoling cw gsnbraf., nOaideAtE by hAd
or water."
IA riota of thu foregoing inote cad statutes appll-
cnble thsroto iis mt Sgrth iA Title 98, Bupra, it la OUX
O~~A~GA that both ol the shots named hospitals me oaxry-
in& on the bualneae of keatth and/or aooidont iASPraA44 in
004tMVOAtiGA of the hBUr8Aas &lW Of th%e Dtate RAd that
the abovo nomatlDelawwe oorportr~4a 1s u~Lav$U~y aotrlag
aa thair a&ant.
You further 84~ it thdrd Ore any ultra v&me ifdt
cr acts ao the &art OS all‘or asp of the tbrar corporation8
rent&mod iA yoUX bU&ui&Y~.
rionoratle 0. 3. X.ookhert,Pago 18
It iS RtAtfid iA T4XM $UXiS&rUd6AOb, Vol. lo,
pe‘ SQ4:
' "Ttierb f8 a plain dlDtldOtiOA betwtan OOZ-
poratc, nots whlah nra inoulld. beoauso thoy two
toyoal the pororo of tbo oor~omtl~n end lncfo
wUch uro iUcs&~l oc ooAtrary to pub110 polloy.
TM5 uppoars in the lo& oc;nmmmnooo ansul46
frxi ultra vlrso cab lllo@ tronmotloas
raup3otlvoly. St 1s OOGVt?AblAtto knop thi5
dlntlnat2on iA n1r.d by usin& tha exprdasirin
*ultra viros' to doal¬a only sots whloh tire
5.n 8xCOn8 OS the cor~orato powore 6tnd to dskoa-
innto as *lllagnl* those eqta whioh 8 corpora-
tlon 16 3xbiitdor; to do. +riCtly nQeaki~&
*the tsrm *ultra vlrfw la uead to dcslgnhto
. the acts~of aorgoratlonm beyond the eoopo 41
t!xlr powers (18 doflnod by tholr OhPrt6rE or
aOt@ Of iACOQO%VitiOA.’ . . .*
C,ooic on Corynetlono, Vol. E, 6t&.Ed., p* 1991.,
otatm
-It. rarely happen5 tbst tbs atate objeotr
to 6%~u&r6 vlrie wt. Thati it has B right
~..
..,.
.....
~.
...>..:
:y- to oblaot by QUOwuraato'la utxbubtdl."
However, Artiala 4, %Otioa LT.!otths Otate d4ASti-
tutlon provides that ths'Attornsy Qonoral ohall a8peOl6llp
Znqttlza into the ch&xrtar rl@ta of all prlvata oorpom.tlona,
and in tho m?maof the Stats take euob cotton la the aourts
as nay ba proper to preve.nt any pr1vd.e corpomtionii Srcm axor-
cluing any powor or dematidlng or oolleotlng any clpeolae of
tams, tolla, fralghta or wh@?rago;s not nuthorizsd by law,
and aball whonsYer suffloteAt 00~60 exlrte,~oaok a~ ~u,&lolal
rorielture of auoh ahartera.
It 1s statad la TIMJOYurl&uUa~da, Vol. 0, p. 8888t
Y2ze loglolnture, darlvlne; lta authority
from the Oonotitutlon, har re-muocod these
provislbos, and thoy oow appear la the Hovlmd
zitctutes. T&if8 CWOtiOAOf thU COIMlti,tUtiQA
not only ooafura pmora ug10athe 4ttornoy Oaa-
oral, but it aloo iwooer dutlrrswhloh mu&
~oscr&lo 0.. 3. Lookhort, Puggola
ba porformd r;bannvor facts arioa WhiOb call
sor tholr porromanab.
8
“The duty to laq.ufre into the charter
rl;iSto OS private ocrporntione is to the and
.. that when in Ido oplnlon it baomcs nooesovry
t0 tnk~ 5t8pf4 to pravont the aburre or ooraoratr
pcmr, be my do 80. Th:n rl@it orlstrc in tha
VC~JI stif~m 0r th0 Ofri00, aA4 ootid, it has
been mild, ba oxumlaed by the httorney Ctenaral
in tho ubsenoo oS a oomtitutlonal provl8lon
ex~re;\aly conferring it.
*The Suprose Court has. srpresnod the be-
110: t&t it was not the purgoeo or the oonistl-
.tuticn to oonr‘er on the Attorney Goneral the
'ri&h%tto l'dAtd,A ~thi4 type Of aqultable ,jWO-
ooeaing * l.n every OQOOin whloh u grlvatr car-
~orrrcion my oloroieo a power tot oonforrod by
l&w, witkxat roSorea.oe to the qusntlon a.8 to
whathar such aXerCis0 ia hlwtfu]. to ocae iA-
torest ceoentlally gubllc. ~ccordlngly, it
has boaa utwvllly hlald that ruits OS thi8
c.haracter cannot ba mlntsinsd WheAprivets
right8 alone are lmolv(rd.”
.:.,.:
:::.::ji:$$:,
j:‘.’: In aupport or the above 6t5~MOAt, we QuoD~rr0rp
ths oaso or Stata v* Yamere bfIA B Trust COiQpiurg, a4 al,
(sup. ct. 5-9~) 17 8. 81. 00, 45 r0iittw8:
.
‘It la not ballavod thnt Z.t wn8 the ptim
FOS0, bg the ssctlor. of the OOnStftUtmj be-
roro reSorred to,~to ccmior OAthe attorney
~WlO3'Alth0 @W0r t0 iWItitUt@ alid AdAtaiA
an equltsble proactaUlng such ~~3 tble,’ in. every
uase 1~ wslch a prlrutcr cor,:omtlon map exer-
cm3 a gmw not cwnrorroa by law, without
rorortinos to the gu*otioa whothctr auuh axar-
else cP :'owor lo hurtfd to mm3 intoraat
ossoatlally giblloa nor is it bell.cvod that
it wzs thereby dntondad to ooafor cm him the
pow@r to lnstftute end l%kiEtGfil cults to
prevent thd axorolao at a pwor 130%ooafsrrod
Cy hW'CA WWJ~ OOr>Qr5tibAl3, eXOq?t iA Q8908
in whlohit lo madetb ~appear
that the srer-
018360r ma powal! will bo hUrEfur to mm3
lritsrwt ssocantially publio. T&l6 oiarv ir
~orornblo 0. P. Lockhart, z%(zo 80
. tmO~~thi309a by the Oonnoations illtho para-
8 tri:ph of the aefltion ot the ooaStltutlOn iii
ahlo:, the g+nnrcll lnnpxa::o ‘whioh 03wla to
be rd?ic~d u;ma 1s foilnd, Sor till those rslat8
. to sistt?ra IA uMch tha publie hwe e diroot
intnroat. 2lie right of t.ha attomey aonaral,
,~.ia bobnlf of the Stato, t&rough tha aourts,
td prevent any private oorpomtlon front
oxoroinin~ r;ny pO;qer not conferred bp loo,
shen t&La is hurtful to tho publfa, or the
aosu@iion of o. frenohiaa, which iix itoelf
1s a publio won& mnaot be queatlanob,
findn0ula axlst from the nature of the of’tlar,.
it tbo abonnoe of e aonatltutional prarleloa
exproao3y ooAs6rrlAg it**
,
In view or t&s foregotag authorZtlo6 an& tho faat8
otstad in gear lrttun, you are a6vtoad t&?.t it its our op2a-
loa tbat the aots of the above named hoepitn1.s en&a&~ ia
the bualneae of beslth inaurai~~o aad the DelaWWe .ooapany
iwtiIg$ 96 tlmlx agant as SW& 6n3 ultra vlroa aotis,
,+..:~.: :
:::~-:,i.):I:jjj;i...:.:.:
AK:50
.