Court Opinion

ID: 6136616
Source: CourtListenerOpinion
Date Created: 2022-02-04 21:44:35.572353+00
Date Added: 2024-06-11T08:54:25.476657
License: Public Domain

Daniels, J.
(dissenting):
On or about the 13tli ,of February, 1880, a contract was made between the defendant and the plaintiff for the continuation of his services as agent in its employment. The contract was made by correspondence, consisting of the following letter written to him by the president of the company:
“New York, Februa/ry 13, 1880.
Mr. Henry Hale :
“Dear Sir: We herewith agree to continue your services as agent in this company on the following terms:
“ 1. The company will pay you a monthly salary at the rate of two thousand dollars per annum.
“ 2. The company agree likewise to give you regular renewal commissions on the policies obtained by you when the premiums shall have been paid to the company.
“ 3. The company further agrees to give you a bonus of seventy-live dollars in each quarter when you shall place thirty-five policies, averaging one thousand dollars or more each, upon different individuals, to be accepted by the company, provided such issue shall only be reckoned by the quarters commencing respectively on the first day of May or August, or November or February.
“4. If in the twelve months commencing the first day of February, 1880, you shall have accepted and issued for this company one hundred and fifty policies as above, the company will give you one hundred dollars additional bonus, and if the gross insurance on such policies shall amount to two Hundred and twenty-five thousand dollars, the company will give you another additional one hundred dollars.
“ It is understood and agreed that in accepting this agreement, you pledge yourself to use your best efforts for the interest of the company and for its progress in the getting of new'' business and otherwise, under the rules of the company as communicated to you by the officers, from time to time; further, that your time and efforts belong exclusively to the company, and are to be given industriously, intelligently and faithfully to the prosecution of their business, under the direction of the president and the secretary.
“Yery truly yours,'
“ W. M. COLE, Presidents
*278Which, was accepted in writing by the plaintiff. This contract, although it was not so stated in the letter, was clearly intended to extend over the period of one year. For the stipulation contained in the third subdivision to pay the plaintiff a bonus of seventy-five dollars in each quarter on the first of Flay, August, November or February when he should place thirty-five policies with the company averaging a thousand dollars each, and the further stipulation contained in the fourth subdivision of the contract to pay him a further bonus for policies obtained in the twelve months commencing the 1st day of February, 1880, evince that to have been the intention and design of the parties. It was a contract for the year ensuing the date of making it, which was the 13th of February, 1880. This contract was not fully performed by the plaintiff, but it was terminated by the consent and agreement of the parties, on the 31st of December, 1880. Previous to that time the plaintiff applied for a renewal or extension of his contract from its expiration on the 13th of February, 1881, but that was not' conceded or agreed to. But no refusal to enter into another contract for the performance of further services was made on behalf of the defendant, but the plaintiff entered into an agreement before the 31st of December, 1880, with the Equitable Life Insurance Company to act as the agent of that company. And on or about that day he gave notice to the defendant that he had made such an agreement, and about the sixth of January thereafter he entered the service of that company. Before the making of this last agreement the defendant had no information of the plaintiff’s intention to enter into the service of the other company. But when the defendant’s officers were apprised of the fact that a contract had been made between the plaintiff and that company, they consented to the termination of the plaintiff’s agreement with the defendant on the 31st of December, 1880, and after that he performed no services for the defendant.
He had been in a similar capacity in the service of the defendant in the years 1878 and 1879 and had obtained policies of insurance on the lives of different individuals during those years, and from the 13th of February, 1880, to the last of December of the same year he was. paid commissions on the renewal premiums of such policies. In this action the claim made by him was for commissions on still further renewal premiums, including those paid upon policies or risks obtained *279by him for tbo defendant while he was employed by it under the contract of February, 1880, and after he had left its service, and the referee, construing the agreement to entitle him to such commissions, allowed them to him upon the premiums received by the defendant during the years 1881, 1882,1883 and 1881. These commissions he was considered to be entitled to recover under the second subdivision of the contract. But it is evident from the letter forming the agreement that all that was intended to be paid to the plaintiff while it continued in force, was to be for the yearly services performed under it. There was no agreement inserted in the letter to make payment to him for such services after the contract itself should terminate, but the stipulations for the compensation mentioned in the contract were limited to the one year appearing to be within the contemplation of the parties. The salary which he was restricted to was for that period, and so were the bonuses to be paid to him lor the thirty-five quarterly pohcies and the one hundred and fifty yearly pobcies. And it can hardly be supposed from the language contained in the second subdivision of the letter that any different period from that was within the intention of the parties; during which renewal commissions were payable to the plaintiff. In construing the contract the court is entitled to place itself in the situation of the parties at the time when it was made. They had before them the fact that the plaintiff had obtained pobcies or risks for the defendant while he was in its service in 1878 and 1879, upon which renewal premiums would be payable during the year 1880. No renewal premiums would be payable on pobcies issued in that year, and consequently no commissions for renewal premiums during that year could be received by the plaintiff. The parties consequently must have had in their minds when the agreementwasmade the pobcies which had been issued previous to the 13th of February, 1880, and had been obtained by the plaintiff, and it was on those policies that he was to receive his regular renewal commissions. The language of this subdivision of the letter is adapted to the expression of that intention, but not of the intention to create an obbgation to pay the plaintiff renewal commissions on all pobcies obtained by him, after he should leave the service of the defendant, and during all the time such pobcies should continue to run. That would be an entirely unreasonable construction to be placed upon *280this language. It is not to be supposed that the defendant would obligate itself to pay such commissions for an indefinite series of years, as it might under the construction adopted by the referee, or that the plaintiff at the time when this agreement was made expected that such commissions should be received by him for the services that he might perform for the company between the 13th of February, 1880, and the 13th of February, 1881.
This result also follows from the circumstance that the agreement itself was terminated by the consent of both parties on the 31st of December, 1880, It was not the effect of the action of the parties that it should be terminated in part, or that the obligation mentioned in subdivision 2 of the letter should be reserved and continued. If it had been, some intimation or stipulation to that effect would have been made at the time, but no reservation whatever of any future liability under this contract to the plaintiff was made, but it was completely .and wholly terminated by the consent and action of the parties. And that termination deprived it of all future and prospective force as an agreement. It was substantially a rescission of so much of the agreement as remained unperformed, consisting of one month and thirteen days’ service. to be rendered by the plaintiff, apd a corresponding obligation on the part of the defendant to pay him for such service. And it is the nature of such a rescission that the contract affected by it as to the future relations of the parties, shall be entirely terminated. (Fullager v. Reville, 3 Hun, 600; Shaw v. Home Life Insurance Co., 49 N. Y., 681.)
The judgment should be reversed, and a new trial ordered, with costs to abide the event.
Judgment affirmed, with costs.