Utilities Insurance v. Stuart

278 N.W. 827, 134 Neb. 413, 1938 Neb. LEXIS 54
CourtNebraska Supreme Court
DecidedApril 1, 1938
DocketNo. 30149
StatusPublished
Cited by9 cases

This text of 278 N.W. 827 (Utilities Insurance v. Stuart) is published on Counsel Stack Legal Research, covering Nebraska Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Utilities Insurance v. Stuart, 278 N.W. 827, 134 Neb. 413, 1938 Neb. LEXIS 54 (Neb. 1938).

Opinion

Eldred, District Judge.

This is an action brought by Utilities Insurance Company, plaintiff, against Charles Stuart and Richard L. Kimball, defendants, upon a written contract executed under date of August 1, 1930, purporting to have been made by and between Lynton T. Block & Company, first party, alleged to be engaged in the insurance business and to operate Utilities Indemnity Exchange, as attorney in fact for the subscribers thereat, A. R. Talbot Underwriters, Inc., general agent, party of the second part, alleged to be attorney in fact for and to operate Highways Motor Underwriters, an insurance exchange insuring automobile risks, and Richard L. Kimball and Charles Stuart, third parties. The contract provides: “The third parties are now actively connected with A. R. Talbot Underwriters, Inc., and it is understood and agreed that in the event the said A. R. Talbot Underwriters, Inc., cease to be actively engaged in business * * * then the third parties * * * shall be substituted herein as the genera] agent with like effect as-if this contract were made with them in the first instance.” It is alleged that A. R. Talbot Underwriters, Inc., ceased to be actively engaged in business January 1, 1931; that while Richard L. Kimball did not sign the contract, his failure to do so was an oversight; that it was his intention to be bound by it; that he assented to and adopted the terms of the contract; and that Richard L. Kimball and Charles Stuart, on January 1, 1931, became substituted for A. R. Talbot Underwriters, Inc. The petition alleges the reinsurance by plaintiff of the liabilities of Utilities Indemnity Exchange and claims to have succeeded by assignment to the right of the subscribers of Utilities Indemnity Exchange and Lynton T. Block & Company. Plaintiff prays for recovery of amounts claimed due from defendants for insurance premiums for which, it is claimed, they became responsible as general agents.

[416]*416Defendant, Stuart, answering plaintiff’s petition, (1) denies all allegations therein contained; (2) alleges that the contract sued on by plaintiff never became a binding contract as to him, because it was not executed by Richard L. Kimball; and (3) that on October 30, 1930, Lynton T. Block' & Company and A. R. Talbot Underwriters, Inc., entered into an agreement superseding the contract sued oh in this action; and that from and after said date the contract sued on had no binding force upon any of the parties thereto. The reply of plaintiff is a general denial. The answer of defendant Kimball is a general denial.

On trial, there was a verdict and judgment for plaintiff against both defendants, and from an order of the court overruling separate motions for new trial, defendants have appealed. In this opinion the plaintiff in the lower court, appellee herein, is referred to as plaintiff, and the defendants in the lower court, appellants, are referred to as defendants.

It appears that defendants; Kimball and Stuart, and A. R. Talbot Underwriters, Inc., were interested in Highways Motor Underwriters, a reciprocal exchange, insuring automobile risks; A. R. Talbot Underwriters, Inc., was its attorney in fact; Utilities Indemnity Exchange was a reciprocal exchange, and Lynton T. Block & Company was its attorney in fact. A reciprocal exchange is defined in the testimony as: “An unincorporated association of firms, corporations and individuals who agree by written instrument called power of attorney to choose an attorney in fact to act for them in the exchange of indemnity. The attorney in fact is empowered under a reciprocal contract, — reciprocal power of attorney to handle premiums, settle losses, and in short, to carry out the business of insurance for those who join in such an association.” The contract which is the foundation of this suit contains the following clause:

“Fifteenth: The third parties are now actively connected with Ai R. Talbot Underwriters, Inc., and it is understood and agreed that in the event that A. R. Talbot [417]*417Underwriters, Inc. cease to be actively engaged in-.business or in the event that the third parties shall form, a partnership or corporation , and engage actively in .business by way of taking over all. or any substantial part 'of -the business of A. R. Talbot Underwriters, Inc., then said third parties or the partnership or corporation to . be so formed by them shall be substituted herein as the general agent with like effect as if this contract were made with them in the-first instance.” . ' . ■

The contract is signed by Lynton T. Block & Company, and by “A. R. Talbot Underwriters, Inc., by Charles Stuart, President. Attest: Richard L. Kimball, Secretary.” It is also signed by Charles Stuart individually, but is not signed by Richard L. Kimball individually.

It is first urged that the defendant Stuart is not bound by the contract sued on because not signed by defendant Kimball. In brief of defendant Stuart, it is said: .“Where a contract in writing is obviously drawn as a mutual agreement between several parties to be signed by all of them, it must be executed by -all- of such parties or it will not bind any of them.” In support of this proposition defendant quotes at length from Welsh v. Premack, 61 S. Dak. 326, 249 N. W. 1. But, a modification to the rule presented is recognized in- that case; that is, that the contract must be executed, by all parties signing it, “or otherwise acceding to its terms.” To like effect is Hess v. Lackey, 191 Ind. 107, 132 N. E. 257; also cited by defendant. These cases are in harmony with.the view of-the law adopted by the trial court in this case as expressed by instruction No. 6, of which defendant Kimball complains. In Wilcox v. Saunders, 4 Neb. 569, cited by defendant, -the question as to a party being bound on a contract -by having acceded to its terms in some manner other than by signing it was not involved or considered. The same is true of Middleboro Nat. Bank v. Richards, 55 Neb. 682, 76 N. W. 528, and Morton v. Harvey, 57 Neb. 304, 77 N. W. 808, also cited by defendant. Further, in the last two cases the-bond involved was signed by part of the sureties, on the condition [418]*418that it was not. to be considered complete or delivered until signed by all the-.sureties named, which presented a different question than here involved.

While the defendant Kimball' was named as party to the contract and it was prepared for his signature, there was no testimony or contention made that it was signed by Stuart on condition that it was not to become a binding obligation as to him or delivered until signed by Kimball. As to delivery, the defendant Stuart testified that when he signed the contract he “turned it over to Kimball.” When asked: “Q. Did you have any understanding or agreement with him at that time that he would sign the instrument?” He answered; “No.” Kimball testified as to the same matter': “Q. Did Mr. Stuart say anything to you concerning not delivering this contract to any one until you had signed it? By the Court: Shouldn’t that be confined to the time? Q. Yes. I mean at the time you got the contract, exhibit 6, from him signed by him. * * * A. No, there was nothing said.” Consequently, the defendant Stuart, having executed and delivered the contract, or permitted it to be delivered, is bound by the obligation therein assumed, although the contract was never signed by Kimball. Farmers State Bank of York v. Brock, 120 Neb. 551, 234 N. W. 92; Kansas City Terra-Cotta Lumber Co. v. Murphy, 49 Neb. 674, 68 N. W. 1030; Naylor v. Stene, 96 Minn. 57, 104 N. W. 685.

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Cite This Page — Counsel Stack

Bluebook (online)
278 N.W. 827, 134 Neb. 413, 1938 Neb. LEXIS 54, Counsel Stack Legal Research, https://law.counselstack.com/opinion/utilities-insurance-v-stuart-neb-1938.