Teets v. American Family Mutual Insurance Co.

272 S.W.3d 455, 2008 Mo. App. LEXIS 1684, 2008 WL 5423987
CourtMissouri Court of Appeals
DecidedDecember 9, 2008
DocketED 90356
StatusPublished
Cited by19 cases

This text of 272 S.W.3d 455 (Teets v. American Family Mutual Insurance Co.) is published on Counsel Stack Legal Research, covering Missouri Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Teets v. American Family Mutual Insurance Co., 272 S.W.3d 455, 2008 Mo. App. LEXIS 1684, 2008 WL 5423987 (Mo. Ct. App. 2008).

Opinion

KURT S. ODENWALD, Presiding Judge.

Introduction

American Family Life Insurance Company and American Standard Insurance Company of Wisconsin (collectively referred to as American Family) appeal the trial court’s judgment entered by the Circuit Court of the City of St. Louis, following a jury verdict in favor of terminated insurance agent, J. Bradley Teets (Teets), on Teets’s claim for breach of contract. We affirm.

Procedural History/Background

Teets began working as an insurance agent for American Family in Jackson, Missouri in 1982. On January 1, 1993, Teets signed an American Family Agent Agreement (the Agreement), which governed his agency until July 17, 2003, when American Family terminated the Agreement.

The Agreement set forth the obligations of both Teets, as the insurance agent, and American Family. The Agreement provided that Teets was not an employee of American Family, but was an independent contractor.

Specifically at issue in this litigation are the termination provisions contained in Paragraph 6, Section (h) of the Agreement. Section (h), Part 1 outlines the general termination provision as follows:

h. 1) Except as provided in paragraph 2) below, this agreement may be terminated by either party with or without cause by giving written notice to the other and shall be deemed terminated as of the date specified in that notice. If both parties give notice, the earlier ter *459 mination date shall control. This agreement shall automatically terminate upon your death or upon the date your license to act as an agent for [American Family] is suspended, revoked or canceled.

Section (h), Part 2 sets forth an exception to Part 1:

2) After two years from the effective date of this agreement or after the termination date of your Agent Advance Compensation Plan, whichever is later, [American Family] will give you notice in writing of any undesirable performance which could cause termination of this agreement if not corrected. [American Family] will not terminate this agreement for those reasons for a period of six months after that written notice. In no case shall notice of undesirable performance be required prior to termination if the performance in question involves a violation of Sect. 4.i. or any other dishonest, disloyal or unlawful conduct; nor shall any notice be required in the event that [American Family] terminates substantially all agreements of this type throughout [American Family] or in a particular state or area. 1

During a period of time leading up to September 2000, a number of complaints were made to American Family and Teets’s District Manager, Richard Friend (Friend), by Teets’s customers regarding his customer service and the handling of claims. Friend spoke with Teets regarding these issues as they arose. In September 2000, Friend specifically spoke with Teets regarding several customer issues that were brought to his attention.

After discussing the situation with American Family’s Missouri East Sales Director, Gary Flynn (Flynn), Friend sent a formal “notice of undesirable performance” letter to Teets on December 20, 2000. The letter outlined Teets’s customer services issues and specifically stated:

This letter is a six month notice of your undesirable performance per your Agency Agreement, Section 6 h.2. Your performance will be monitored monthly and reviewed with you upon conclusion of this period commencing January 1, 2001 to June 30, 2001. Your failure to provide proper service will result in my recommendation to terminate your Agency Agreement.
It is my sincere hope that you take the necessary steps to rectify the above problem.

American Family presented evidence at trial that even after the December 2000 letter, customer complaints regarding Teets’s service continued. Teets presented his own evidence of satisfied customers, statistics of his growing business, and his prosperous insurance agency. On June 24, 2003, Friend wrote to Flynn requesting the termination of Teets’s Agreement -with American Family. This letter detailed the complaints American Family received throughout the years regarding Teets’s customer service. On July 17, 2003, American Family terminated the Agreement with Teets for the reasons stated in the June 24, 2003 letter sent from Friend to Flynn.

Teets brought suit against American Family, Friend, and another American Family agent, Janey Foust (Foust), in the Circuit Court of the City of St. Louis on June 4, 2004. Teets asserted breach of contract against American Family in *460 Count I, breach of implied covenant of good faith and fair dealing against American Family in Count II, tortious interference with business relations against Friend and Foust in Count III, and unjust enrichment against American Family, Friend, and Foust in Count IV. On January 10, 2006, the trial court granted the defendants’ motion for summary judgment as to Count IV, unjust enrichment. Prior to the start of trial, Teets settled his claims against Foust for an undisclosed sum.

A jury trial was held in June 2007, on Counts I and II against American Family and Count III against Friend. At the conclusion of Teetste case, American Family moved for a directed verdict on Counts I and II, which the trial court denied. Friend moved for a directed verdict on Count III, which the trial court took under submission. At the conclusion of all the evidence, American Family moved for a directed verdict on Count I, which the trial court denied. Teets dismissed Count II against American Family, and the trial court granted Friend’s motion for a directed verdict on Count III. The only count remaining for the jury to consider was Count I, Teets’s breach of contract claim against American Family.

The jury returned a verdict for Teets, and against American Family, for one million dollars. The trial court entered a judgment on the verdict on June 25, 2007. American Family filed a Motion in the Alternative for Judgment Notwithstanding the Verdict, a New Trial, or Remittitur on July 25, 2007, to which Teets responded on September 5, 2007. The trial court denied American Family’s motion on September 18, 2007. This appeal follows.

Points on Appeal

American Family raises six points of error on appeal. The first two points allege the trial court erred in denying American Family’s motions for directed verdict and judgment notwithstanding the verdict, and focus on the termination provisions of the Agreement. First, American Family alleges the trial court erred because Teets did not make a submissible case on his breach of contract claim. American Family contends that the Agreement was terminable at will, and therefore, its termination did not breach the Agreement. Second, American Family argues Teets failed to make a submissible case on his breach of contract claim because American Family gave Teets the required six months of notice of undesirable performance in writing, and thus complied with the Agreement’s only prerequisite to termination.

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Cite This Page — Counsel Stack

Bluebook (online)
272 S.W.3d 455, 2008 Mo. App. LEXIS 1684, 2008 WL 5423987, Counsel Stack Legal Research, https://law.counselstack.com/opinion/teets-v-american-family-mutual-insurance-co-moctapp-2008.