Kiker v. Bank Sav. Life Ins. Co.

23 P.2d 366, 37 N.M. 346
CourtNew Mexico Supreme Court
DecidedMay 24, 1933
DocketNo. 3834.
StatusPublished
Cited by9 cases

This text of 23 P.2d 366 (Kiker v. Bank Sav. Life Ins. Co.) is published on Counsel Stack Legal Research, covering New Mexico Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Kiker v. Bank Sav. Life Ins. Co., 23 P.2d 366, 37 N.M. 346 (N.M. 1933).

Opinion

WATSON, Chief Justice.

The Bank Savings Life Insurance Company appeals from a judgment upon a verdict recovered by R. J. Kiker for damages for having been wrongfully discharged from its service.

The contract of employment was in writing. It constituted appellee state agent of appellant for New Mexico. It prescribed the compensation, which was to consist of commissions on original and renewal premiums. Paragraphs 6 and 12 are as follows:

“6. That in consideration of the commissions, both first-year and renewal for which provision is herein made, the Agent agrees to devote his whole time, attention and ability to the soliciting of life insurance for the Company. Failure to comply with this agreement will be cause, at the option of the Company, for the termination of this contract.

“That the Agent will not, while this contract remains in force, represent any other Life Insurance Company.
“12. That this contract shall continue as to the writing of new business from the date of its beginning until termination as herein provided, or by the death of the Agent, or the resignation of the Agent by thirty (30) days’ written notice, or until superseded by another contract. It is expressly agreed that if the Agent shall give cause by any of the following acts:
“1. Fraud.
“2. Failure to pay over moneys belonging to the Company as herein provided;
“3. Conduct prejudicial to the interest of the Company; or
“4. Violation of provisions of Sec. 9 hereof ;

the company shall have the right to terminate this contract at any time by serving written notice of such termination.

“In the event of termination for the first or the second cause above, all interest in and to any renewal commissions due or to become due under this contract, shall be forfeited.”

The contract was terminated by the act of appellant in discharging appellee, effected by a letter in the following language: “Since you are negotiating with other companies,, with a view to severing your connection with us, and also since it has been evident for some time that you are not devoting your full time toward the development of business for this company in the State of New Mexico, in accordance with your contract, we find it necessary to advise you that thirty days from this date, your contract will be terminated in accordance with its provisions.”

Appellee, after some allegations calculated to show the real trouble between the parties, and that he was in the right, pleaded that he had faithfully performed his part of the contract, and had, nevertheless, been unlawfully discharged.

Appellant, by answer, in justification of the discharge, pleaded that appellee had failed to devote his whole time, attention, and ability to the business, and that he had failed to turn over moneys which he had collected and which belonged to appellant. Other conduct claimed to have been prejudicial to appellant’s interests was set up, but requires no mention. By cross-complaint appellant pleaded that appellee had collected and failed to turn over, and then owed appellant, $803.04, for which it prayed judgment.

Appellee, by reply, pleaded that appellant was estopped from relying upon any indebtedness on account of moneys collected and not turned over; First, because such was not the reason for appellant’s dismissal; and, second, because, by course of dealing from the beginning, and at all times, appellant had acquiesced in such indebtedness. By way of answer to the cross-complaint, he admitted the indebtedness, and claimed that from the time of his discharge he had held the same as an offset against his damages.

We shall first consider the attempted justification of the discharge on the ground of appellee’s failure to devote all of his time, attention, and ability to appellant’s business. The facts in this regard, as described in appellant’s brief, are that appellee took a group of Taos Indians on certain vaudeville tours for exhibition purposes, and charged admission; a ten days’ tour in September, 1928, a three weeks’ tour in November and December, 1928, and a one week tour in February, 1929. As the main facts were admitted, appellant moved for a directed verdict at the close of the case, and later moved for a peremptory instruction. It now contends that the court erred in overruling these motions.

There has been much argument as to whether these tours were independent “business enterprises” of appellee, or whether they were intended and calculated to promote the interests of the agency by way of advertising and making new contacts. Even if they had no other purpose or effect than to divert or profit appellee, we should be unwilling to say, as matter of law, that they constituted cause for his discharge. An agreement “to devote * * * whole time, attention and ability” to an employment cannot be taken literally, and is to be reasonably interpreted. Appellant was entitled to have the question submitted to the jury under proper instructions, but not, in our opinion, to a directed verdict or a peremptory instruction.

Appellant also moved for a peremptory instruction upon the admitted fact of appellee’s failure to turn over all moneys in his hands belonging to appellant. As appears from the letter above set forth, this was not one of the reasons assigned by appellant for the dismissal. Appellee contends that the fact is therefore entirely immaterial.

Generally, in an action for wrongful discharge, the employer may plead in defense any sufficient cause, though it may have been unknown to him at the time, though his real reason or motive may have been something else, and though another cause may have been expressly assigned. Williston on Contracts, §§ 744, 839; Labatt on Master and Servant, § 189; Page on Contracts (2d Ed.) § 3058; 18 R. C. L. 516; 39 C. J. 89.

But the parties of course have the right to stipulate the manner in which the employer may terminate the contract. If they stipulate that it shall be by written notice specifying the cause, a discharge specifying no cause, or an insufficient cause, would be wrongful. It follows that, under such a contract, a cause not specified would not be available in defense. Hughes v. Gross et al., 166 Mass. 61, 43 N. E. 1031, 32 L. R. A. 620, 55 Am. St. Rep. 375, cited; 18 R. C. L. 516; Mortimer v. Bristol, 190 App. Div. 452, 180 N. Y. S. 55.

Appellant here admits that the contract, by paragraph 12, supra, required written notice, but denies that appellee was entitled to a specification therein of the cause for discharge. In Mortimer v. Bristol, supra, a requirement of written .notice of discharge seems to have been deemed to include or imply a requirement that the cause be specified therein. This, no doubt, on the theory that the provision was for the agent’s benefit, and that, unless so interpreted, it would b« of slight, if any, advantage. However that may be, we think that this particular contract must be so interpreted. Paragraph 12 itself refutes appellant’s contention.

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Bluebook (online)
23 P.2d 366, 37 N.M. 346, Counsel Stack Legal Research, https://law.counselstack.com/opinion/kiker-v-bank-sav-life-ins-co-nm-1933.