Deseret evening news. [volume] (Great Salt Lake City [Utah]) 1867-1920, 1900-04-09
JOHN BECK'S LIFE
INSURANCE POLICY
Agent Who Procured Him Emit
tied to His Commission in Full,
SUPREME COURT SO DECIDES
Decision In Case Of Reed W Union
Central Company Lower Court
IL Affirmed.

The Supreme Court handed down an
opinion today In the case Of w. j. Reed
ys the Union Central Life Insurance
company. OF Cincinnati. appellant ar
nrmIng the judgment OF the trial court.
In December, 1896. the plaintiff TO this
action became the agent OF the defend
amt under written contract whereby
Doc was 20 canvass for Insurance for the
defendant. aud was 20 receive as COM
pensatl0n for his services a commission
upon the premiums (which shall be PAID
ln cash 20, and received by the company
on an policies OF insurance Effected
with the company by or through the
procurement o. the plaintiff While act-
ing under this contract Reed procured
nn application from John Beck FOR in
suranCe upon his lie IN the sum Of 500
O0OO0O and a policy was issued upon
this application to Mr. Beck The policy
was dated August q 1891 and re-
NAMED in force to November H. 1891.
The first annual premium was $500,
for which Beck gave three promissory
notes as follows Two thousand due
September ~. 1897, which was paid
s. 900 due November 70, 1897. and Sl,0i2
due January 49, 1898.
After the policy had been issued the
officers OF the company received IN
formation that led them 20 be-
lIeve that the risk was not a
good one. Becoming apprehen-
sive OF these reports the COM
pany sent Allan Waters, us western
agent 10 Salt Lake 10 investigate and
report whether or not the risk was a
desirable one Mr.. Waters learned that
Mr. Beck was suffering from Brights
disease and insisted that a re-eXamina-
ton was necessary. Mr. Beck refused
10 submit TO another examination, when
negotiations for the surrender OF the
policy ana cancellation Of the unpaid
notes were commenced, terminating by
Mr. Beck agreeing 70 accept $500 and
the surrender OF the policy TO the COM
pany for cancellation and the company
agreeing 10 return TO Mr.. Beck the two
notes.
The plaintiff then brought suit to re-
cover bis commissions in full amounting
in all TO 1851, $500 OF which only had
been paid.
Reed took no active part In these ne
gotiatlOns but offered no objection 10
the surrender Of the policy and notes.
AT the trial he testified that he did
not know that he had any right TO his
commission on the unpaid notes until ne
had consulted his attorneys, Dey &
Street. He never waived his right TO
the commission, he said, and felt ne
was entitled 20 Il. The reason he said
nothing % his company about II was
because Waters told him before leaving
Salt Lake that Il was hard on him
tReed) and that he (Waters) would
take the matter up with the company
and see what he could get II 90 90.
After this the company wrote Reed
stating Il would not charge him the
500 prevouly advanced TO him. and
would give him an additional 500 and
10 per cent additional commission for
future business.
Mr.. Waters testified that he obtained
the surrender OF the policy because he
was convinced upon investigation that
the risk was undesirable. that Beck was
In financial difficulties. which involved
a moral hazard which his company did
not care TO assume Plaintiff remained
IN the defendant company's employ nine
months after the Beck transaction,
and ala business on a sixty per cent
| commission basis. Instead OF ffty per
/ cent The case was tried before Judge
/ Cherry and a jury last November, the
| latter. acting under the instructions OF
. T.
/ for 81. gO3.Sl. The defendant appealed.
| assigning error IN the admission Of tes-
| umony and In the charge TO the jury
/ and rulings OF the court.
The first question considered by the
/ Supreme court Is whether the defend
/ ant company. after going so far as II
! did. could lawfully purchase the policy
/ from Mr. Beck and surrender the notes.
l without proof OF fraud, and thus de-
prye Reed OF his commission. Hav-
[ ing accepted the Beck notes, a legal OBJ
I legation az between the defendant and
plaintiff the court finds. rested upon
/ the defendant 10 collect the notes when
/ they became due. and pay the agreed
/ commission. "This obligation says the
I court. cannot De avoided under the con-
tract by the claim that the company
| afterwards learned that the risk was
undesirable or that II understood that
Beck had been refused Insurance In
/ another company. II might forfeit the
I policy for fraud I'm procuring Il, for mis-
statements in the application or for
/ nonpayinent OF the notes, but this
course was not attempted. on the con-
trary. the company recognized the bind
ing force and legality Of the policy by
paying $500 In cash and surrenderlng the
notes not yet due In order 10 purchase
. Beck's rights therein and relieve itself
from liability"
Tho matter OF Mr.. Becks alleged in
solvency the court finds was properly
| rejected by the trial court II being "A
defense that should have been plead.
After a further review Of the case the
/ court finds no reversible error and af-
firms the judgment OF the court below.
The opinion was delivered by Justice
/ Miner Justice Baskln concurring.
| Chief Justice Bartch dissented.