Schuh v. Prudential Ins. Co. of America

96 F. Supp. 400, 1950 U.S. Dist. LEXIS 1969
CourtDistrict Court, D. Minnesota
DecidedDecember 6, 1950
DocketCiv. No. 3394
StatusPublished

This text of 96 F. Supp. 400 (Schuh v. Prudential Ins. Co. of America) is published on Counsel Stack Legal Research, covering District Court, D. Minnesota primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Schuh v. Prudential Ins. Co. of America, 96 F. Supp. 400, 1950 U.S. Dist. LEXIS 1969 (mnd 1950).

Opinion

NORDBYE, Chief Judge.

The 'second amended complaint consists of six counts. The first five counts are predicated upon alleged breach of contracts by defendant of ordinary life insurance, group insurance, the retirement plan for industrial field staff, staff insurance,’ and a failure to pay plaintiff commissions alleged to be due under the contract of employ[401]*401ment. The sixth count assumes to sound in tort. It alleges that plaintiff was a District Manager of the defendant company in Minneapolis; that commencing at a time prior to the 21st day of November, 1946, defendant entered upon a course of conduct for the purpose of practicing a fraud and deceit upon plaintiff and to wrongfully and unlawfully breach the contracts and rights which are the subject of the first five causes of action. It is alleged that in April, 1946, plaintiff began to suffer from some of the initial symptoms which ultimately resulted in his becoming totally and permanently disabled on October 22, 1948; that defendant knew that plaintiff’s health from April, 1946, was growing progressively worse and that it knew that if it could force plaintiff to resign before he became permanently and totally disabled, the defendant would unjustly enrich itself at the expense of plaintiff because it could deprive plaintiff of certain benefits to which he would be entitled. Generally, it may be stated that it is contended that the unjust enrichment sought by defendant would materialize if it could discharge plaintiff and terminate his services with the company before he became permanently and totally disabled; that is, the wrongful purpose was the savings on the various insurance contracts and other benefits inuring to plaintiff which could be effected if plaintiff were no longer in the defendant’s employ when he became totally and permanently disabled. The sixth count then states the course of conduct which defendant pursued for the purpose of attaining this end. It is alleged that defendant, through its agents, employees, and officers, began to harass plaintiff by constantly belittling his efforts, in stating that his work was not satisfactory, by threatening to dismiss and discharge him if his production record in the Minneapolis office was not improved, by transferring agents out of his office to other fields, by indulging in criticism of trivial matters, by telling plaintiff if he 'did not disregard the advice of his physician and return to Work on a demoted basis he would be discharged, by telling him that if his attitude' towards the company and its representatives was not proper and satisfactory he would be discharged, by threatening to demote him to the position of Assistant District Manager, and by falsely accusing him of malingering.

It was recognized by plaintiff’s counsel during the argument on the motion that that which defendant did were acts which came fairly within the scope of an employer’s supervision of an employee and that this conduct as related in the sixth count did not constitute unlawful acts in and of themselves; rather, it is argued that the acts may be characterized as lawful acts but they were directed to the attainment of an unlawful result, to wit, the unjust enrichment of the defendant by terminating plaintiff’s employment before he became totally and permanently disabled. As illustrative of the unjust enrichment sought, it is alleged that if defendant had been successful in getting plaintiff to accept the suggested, demotion, the group insurance benefits would be reduced by $10,000, and that if defendant had been able to force plaintiff to resign before he became totally and permanently disabled, it would bring a cancellation of all group insurance benefits in the total sum of $22,000. Moreover, it is set forth that if defendant had accomplished its purpose, the amounts payable to plaintiff under the retirement plan and by way of renewal commissions would have been materially reduced. Plaintiff contends, however, that he became totally and permanently disabled on or about October 22, 1948, when he was in the employ of defendant, and that the scheme and plan and conspiracy to defraud him of the benefits referred to was not successful. However, it is contended in the sixth count that, as the proximate result of defendant’s acts in furtherance of the scheme and conspiracy of unjust enrichment at the expense of plaintiff, the plaintiff’s pre-existing physical and mental partial disability was aggravated and brought to a climax on Octo.ber 22, 1948, when he became totally and permanently disabled, resulting in a loss of salary of $30,000 to date and $150,000 loss of wages in the future, and that plaintiff “has suffered great and severe mental anguish and suffering and nervous debility [402]*402to his general damage in the sum of $100,-000.00.”

In passing, it may be observed that the files and records herein disclose that the contract of employment between plaintiff and defendant was in writing and contained this provision respecting termination, “That his appointment as Superintendent and this Agreement may be terminated by either the Company or the Superintendent at any time; and that if this Agreement be terminated by either the Company or the Superintendent, the compensation and commissions which shall then have been paid to him, together with the amount then accrued and payable under this Agreement, shall be in full settlement of all claims and demands upon the Company in his favor under this Agreement, it being understood that he shall not be entitled to any further compensation or commissions which a continuance of this Agreement might have secured to him.”

■ There is no denial by plaintiff that this provision was in full force and effect during the entire period with which we are concerned. And obviously it indicates a striking inconsistency with the alleged scheme and plan of the defendant to cause plaintiff to terminate his employment by harassment and criticism, when the contract permitted defendant to terminate the employment at anytime. However, notwithstanding this rather anomalous situation, it seems necessary for the Court to consider the question as to whether or not plaintiff has stated a claim in the sixth count upon which relief can be granted.

It will be observed that plaintiff does not seek any recovery because of any attempted unjust enrichment which was the alleged objective of defendant’s conduct. The damages allegedly sustained by plaintiff are not those which the defendant’s acts sought to achieve. It is not contended that defendant intentionally caused plaintiff’s mental or physical breakdown or that it intended by its conduct to aggravate plaintiff’s mental and physical condition. In fact, the inference is quite to the contrary. Defendant, according to the plaintiff, was apprehensive that plaintiff would become totally and permanently disabled when he was in the employ of defendant as its District Manager; therefore, it would not be likely to do anything intentionally which would accelerate his mental breakdown. Defendant’s alleged course of conduct was directed to a termination of the employment or a demotion before plaintiff’s physical condition evolved into total and permanent disability. In other words, we have a situation where certain lawful acts were directed to attain alleged unlawful ends which were not obtained, and it is contended that certain mental injuries proximately resulted which were not intended by defendant and which are not alleged to have been reasonably foreseeable by defendant as a result of its conduct.

The situation as set forth does not involve, of course, any threatened physical injury or any physical peril to the plaintiff.

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Related

Sanderson v. Northern Pacific Railway Co.
60 L.R.A. 403 (Supreme Court of Minnesota, 1902)

Cite This Page — Counsel Stack

Bluebook (online)
96 F. Supp. 400, 1950 U.S. Dist. LEXIS 1969, Counsel Stack Legal Research, https://law.counselstack.com/opinion/schuh-v-prudential-ins-co-of-america-mnd-1950.