Title: STANDARD INS CO v STURDEVANT
Citation: N/A
Docket Number: 13470
State: Montana
Issuer: Montana Supreme Court
Date: June 21, 1977

No. 13470 I N T H E SUPREME C O U R T O F T H E STATE O F MONTANA 1977 S T A N D A R D INSURANCE COMPANY, a c o r p o r a t i o n , P l a i n t i f f and Respondent, H A R O L D L. STURDEVANT, Defendant and Appellant. Appeal from: D i s t r i c t Court of t h e Fourth J u d i c i a l D i s t r i c t , Honorable Edward Dussault, Judge p r e s i d i n g . Counsel of Record: For Appellant: Tipp and Hoven, Missoula, Montana Raymond Tipp argued, Missoula, Montana For Respondent : Raymond J. Fox argued, Missoula, Montana F i l e d : Submitted: A p r i l 1 9 , 1977 Decided : j u ~ 2 1 1 9 n X r . Zus'iice 3auiel 2. Shea delivered the dpinion of the Court. This i s an appeal from a nonjury judgment of the d i s t r i c t c o u r t , Missoula County, i n an action t o recover on a promissory note. Harold L. Sturdevant, appellant, entered into an agency- manager employment contract with Standard Insurance Company, respondent, i n 1962. Under the terms of the contract, Sturdevant w d s appointed manager of Standard's agency i n Missoula, Montana. 5e agreed t o maintain the agency and r e c r u i t and t r a i n sub-agents, A S well a s personally procure insurance applications. The p a r t i e s diltered i n t o similar contracts i n 1963 and 1968 a s t o new business dZter those dates. Sturdevant also executed a promissory note i n 1968 t o repay loans made t o him by Standard. Income derived from ~ t u r d e v a n t ' s contracts was t o be applied t o the note. Standard sued t o c o l l e c t the balance due on the note and Sturdevant counterclaimed seeking vested renewals under the con- Eracts, which he alleged were s t i l l i n e f f e c t . I n i t s reply T V he counterclaim Standard alleged termination of the contracts. The p a r t i e s agreed t o determine a f t e r t r i a l the amount due each ~ t h e r based upon the termination date found by the d i s t r i c t court. Judgment was entered i n favor of Standard establishing 3eptember 15, 1969 a s the termination date of the contracts and provided f o r further hearing, i f the parties could not agree on the dinounts due. The only issue presented for review by Sturdevant i s whether the d i s t r i c t court erred i n determining the agency-manager con- tracts were terminated on September 15, 1969. Sturdevant contends Lhe contracts extended through 1971. On August 14, 1969, Frank Burger, Sturdevant ' s supervisor with Standard, wrote this letter to Sturdevant: "Dear Harold: "This is to confirm our conversation of August 12, at which time you tendered verbal notice of intent to resign effective September 15. It is the purpose of this letter to acknow- ledge your intent. "Once we have determined who the replacement will be, I will advise. I will appreciate very much your effort to make the transition a orderly and trouble- free one from a service standpoint. "We ' 11 be in touch.' * * *" Burger testified that on August 12, 1969, Sturdevant told him he to resign and was "throwing in the and Burger accepted the resignation. Sturdevant, on the other hand, testified Burger and he had disagreements during the conversation, but when Burger asked if he intended to resign, Sturdevant merely replied it might come to that. Sturdevant testified he did not intend to resign and he did not think his contracts and position as manager were terminated. Therefore, he ignored the letter. Sturdevant's testimony was supported at trial by several agents in the Missoula office. Agent Swenson testified Sturdevant told him he would not resign; and agent Moffett testified Sturde- vant showed him Burger's letter and said he did not resign. Sturdevant, however, did leave the office in September 1969 and according to Moffett, he never again worked/as manager. After Sturdevant left Standard's office, Burger testified he had no knowledge of any work performed by Sturdevant for Standard. Although Sturdevant took only personal family pictures when he left the office, Burger collected the rest of Sturdevant's property and later delivered it to him. After his departure from Standard, Sturdevant opened another insurance office, hired new agents and had contracts with and was licensed to sell for other companies. He testified however, that he kept Standard's insurance in force and serviced Standard policies at his new office. There is no evidence he sold more insurance for Standard, after opening his new office. In urging a different termination date than September 1969, Sturdevant makes three arguments: ( 1 ) The letter from Burger to Sturdevant did not comply with contract provisions allowing termination upon thirty days written notice since it did not specifically mention termination of the contracts, but only referred to intent to resign. ( 2 ) Since Standard obtained an agent's license for Sturdevant until 1971, the agency-manager contract could not have been terminated before 1971 when the license was not renewed. ( 3 ) The evidence was not sufficient to show the contracts were terminated by mutual consent. Concerning the first argument it is true that Burger's letter does not explicitly refer to "termination of the contracts1', but its meaning is clear and unambiguous, and constitutes adequate notice under the contracts. Clearly, Sturdevant understood its meaning enough to remove himself from Standard's offices and to open up another insurance business as an agent for other com- panies . In his second argument, Sturdevant misconstrues the appli- cation of Title 40, Chapter 33, R.C.M. 1947, concerning the licensing of insurance agents. This chapter provides, for purposes here, that an insurance license cannot be issued unless the recipient is appointed an agent by an authorized insurer. Since Standard somehow licensed Sturdevant until 1971, Sturdevant 3rgues h i s agency-manager contracts with Standard could not be ~erminated before 1971. But this licensing requirement is pri- marily for the protection of the public and is not meant to ereate private rights between the agent and insurance company as contended in this case. 16 AppLleman Insurance Law and Prac- While innocent third parties would be protected against any attempt by Standard or Sturdevant to repudiate its agency rela- tionship between 1969 and 1971, this does not by itself entitle Sturdevant to assert a contractual right of agency-manager with Standard between the years 1969 and 1971. It is certainly a factor to be considered, but only in light of all the circumstances, and here there was evidence that Standard renewed the license because of a clerical oversight. Sturdevant is clearly wrong in his last argument that the evidence was not sufficient to establish a mutual rescission. Termination of a contract by mutual consent is a question of fact for the district court. Cruse v. Clawson, 137 Mont. 439, 35.2 P.2d 989. In West River Equipment Co. v. Holzworth, 134 Yont. 582, 587, 335 P.2d 298, we held that a written contract may be cancelled by mutual consent and the cancellation may be oral. The Court stated: I t However, mutual cancellation must be clearly expressed and shown, and acts and conduct of the parties to be sufficient must be clear, convincing and inconsistent with the existence of the contract. [Citing cases] ." In support of his contention there was no mutual agreement to terminate the contracts, Sturdevant relies on evidence that he did not submit a written resignation; his license was ,. renewed until 1971; he ignored Burger's letter; he took only pictures from the office; he continued t o keep the insurance i n force and service policies; and, he t o l d h i s agents he did not resign. While t h i s evidence c l e a r l y put the issue i n dispute, there was substantial evidence t o the contrary s u f f i c i e n t t o support the d i s t r i c t c o u r t ' s determination the contracts t e r - minated on September 15, 1969. The d i s t r i c t court was j u s t i f i e d i n concluding t h a t Sturdevant's departure from Standard's o f f i c e a l s o resulted i n h i s departure from the agency-manager contract he had with Standard. W e note t h a t determination of the amount of money due was deferred u n t i l a f t e r t r i a l and appeal, apparently pursuant t o Rule 4 2 ( b ) , M.R.Civ.P. Multiple t r i a l s and appeals a r i s i n g from a single dispute may create a severe burden i n terms of increased cost t o the l i t i g a n t s , delay i n resolution of the controversy, and court congestion. Where there i s no danger of prejudice and the issues a r e not complex the necessity of separate t r i a l s should be carefully weighed by the d i s t r i c t court t o ensure the rule i s not abused. W e affirm the judgment and remand t h i s cause f o r further proceedings consistent with t h i s opinion. W e Concur: