Farmers Life Insurance v. Hetherington

274 P. 926, 85 Colo. 255, 1929 Colo. LEXIS 194
CourtSupreme Court of Colorado
DecidedFebruary 18, 1929
DocketNo. 12,028.
StatusPublished
Cited by4 cases

This text of 274 P. 926 (Farmers Life Insurance v. Hetherington) is published on Counsel Stack Legal Research, covering Supreme Court of Colorado primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Farmers Life Insurance v. Hetherington, 274 P. 926, 85 Colo. 255, 1929 Colo. LEXIS 194 (Colo. 1929).

Opinion

Mr. Justice Campbell

delivered the opinion of the court.

*256 On March 5,1926, at its annual meeting, the defendant insurance company employed the plaintiff as its general counsel. Claiming a breach by the defendant of the contract of employment, plaintiff brought this action against his employer to recover damages for the breach, and upon the trial before a jury of the issues of fact, plaintiff was awarded damages in the sum of $875, to review which judgment the defendant has sued out this writ of error.

Plaintiff had already served as defendant’s general counsel for one year; having been elected on March 5, 1925, by the defendant’s board of directors in which body the power of selection was vested by section 2 of article II of the defendant’s by-laws. Prior to March 5, 1925, this by-law provided that the board shall elect at its annual meeting each and every year its general officers, designating them by proper title, and among the enumerated list was the office of general counsel, and such general officers so selected were by the terms of the by-law to hold office for one year. Because of some' dissatisfaction that existed as to the election or tenure of office of general counsel, the board of directors, before it proceeded to the election of its officers, on March 5, 1925, duly amended or changed this by-law which, as amended, was spread upon the records, by excluding or eliminating therefrom the office of general counsel; and immediately thereafter, on the same day, selected the plaintiff as its general counsel and the transaction and terms of employment were evidenced by a writing or minute, which was signed by both plaintiff and defendant. In the first paragraph of this writing so signed it is recited that the plaintiff has been employed by defendant as general counsel “until such time as his employment as such may cease and determine by action of the officers or directors of said company.” Ever since March 5,1925, this section 2, as amended on that day, has not been changed or amended and was in force on the 5th of March, 1926, on which day and at its annual meeting the defendant company again *257 employed the plaintiff as its general counsel. At this election in 1926 no writing seems to have evidenced the employment as was the case in 1925. About November 1, 1926, the defendant company by its board of directors assumed to terminate the plaintiff’s employment against his will and he later brought this action.

The complaint alleges in substance, that on March 5, 1926, defendant employed plaintiff as general counsel and that section 2 of article II of the by-laws, as to the tenure of office, was then in force, as theretofore, for one year, and that this section so providing has not been amended, and further alleges that the defendant wrongfully and in violation of the controlling section and before the expiration of his term of office, purported about November 1, 1926, to terminate the same and has refused thereafter to recognize such relation and has not paid the plaintiff for the remainder of the term to his damage in the sum of $2,500.

In its answer the defendant admits the employment, not for one year, but at its will, and sets out the facts as above narrated concerning the change in its by-law and all other acts that it has taken to terminate the employment as it was authorized to do by the then existing by-law.

Plaintiff filed a replication to this answer in which he sets up an alleged estoppel in pais against the defendant’s right to assert or rely upon the alleged change of section 2 of article II, such estoppel being effective for reasons presently to be stated. The result of the trial before a jury was favorable to the plaintiff as above stated.

An attentive consideration of this record justifies the statement that under the evidence it is doubtful as matter of law if plaintiff is entitled to any relief. It is only fair to say that the record indicates that the trial court, at the close of the evidence was in doubt as to the proper course to pursue; whether to direct a verdict for the defendant or to submit the issue to the jury. Had it non- *258 suited the plaintiff or directed a verdict for the defendant, we probably would not have interfered therewith. We are not, however, disposed, for the reasons which will appear later in the opinion, to constitute ourselves as triers of fact and as such decide the case on the evidence as we might do. For in the light of what we shall presently say, that course would be unnecessary, and since there must be a reversal for other reasons which we now proceed to give, we deem it proper to go no further than to set aside the judgment and remand the cause.

Plaintiff sets up in his replication an estoppel in pais. It is based on the proposition that in February, 1926, about one month before the 1926 election, having been asked by the secretary of the company for advice about the by-laws and certificate of incorporation of the company, he inquired of the secretary if section 2 of article II of the by-laws had been amended. Just why the plaintiff asked about this particular by-law does not appear from the evidence. This section was adopted in 1920. These by-laws were soon thereafter printed and enclosed in a pamphlet or small book and this pamphlet was printed while section 2 as originally adopted was in force, and it contained the language that the term of office of general officers is for one year. The secretary in response said that the by-law had not been changed so far as he knew. The plaintiff would have the court believe that because he accepted such qualified answer of the secretary as true, which answer was given upon an inquiry as to a subject matter entirely different from the matter of his employment, the defendant is thereby es-topped in this action to contend that at the time of plaintiff’s employment on March 5, 1926, the office of general counsel was eliminated from section 2 of article II and was so changed as to make the term of office at the will of the employer.

First we say there is no presumption of law that the secretary of this company has power to contract for it or to bind it by any such statement as plaintiff says the *259 secretary made to Mm concerning a change in the bylaw, and there is no evidence of any custom or practice or resolution of the board of directors that vests in the secretary "any such power to contract or to bind the company by any statements he may make of the character here involved. Plaintiff is a lawyer and he was, at the time he made this inquiry of the secretary, a fellow-officer of the latter. As such, plaintiff had the right, the same as the secretary possessed, to examine for himself the records of the company to ascertain whether there had been a change in this section of the by-law concerning the term of his office, but he did not do so. Plaintiff was not justified in forbearing to exercise his right of search or in relying on the secretary as to the status of this particular section. If he made the special inquiry concerning the same he must have had some reason for it. If he did have some reason he did not disclose it at the trial. If he wanted to know about this by-law because it bore on the election of general counsel that would be had a month later, he should have stated to the secretary that fact, hut he did not do so.

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Cite This Page — Counsel Stack

Bluebook (online)
274 P. 926, 85 Colo. 255, 1929 Colo. LEXIS 194, Counsel Stack Legal Research, https://law.counselstack.com/opinion/farmers-life-insurance-v-hetherington-colo-1929.