Court Opinion

ID: 9454600
Source: CourtListenerOpinion
Date Created: 2023-08-04 18:51:22.020411+00
Date Added: 2024-06-11T17:34:11.372049
License: Public Domain

GODBOLD, Circuit Judge
(dissenting) :
The appellant entered into a written contract under which his employment continued until terminated by written notice. A rider provided that his compensation was payable only during the continuance of the contract.
If appellant’s employment was improperly terminated he had a cause of action for damages because he was deprived of the right to earn the renewal premiums. 9 Williston, Contracts, § 1018 at 185-186 (3d ed.).
The appellant was fired in a manner other than required by the contract, after declining an offer of $500 if he would resign.1
The majority thesis, adopting that of the district court, is that the appellant orally “agreed” to a modification of the written contract, which was operative as an amendment because Allstate relied thereon to its detriment, or accepted and acted upon the oral “agreement” so as to work a fraud on Allstate to refuse to carry it out.
The appellant was fired. His employment was at an end. Obviously the last thing Allstate wanted was for him to show up for work and demand he be allowed to continue writing Allstate policies and collecting Allstate premiums. Unquestionably both appellant and Allstate considered the employment at an end.2 But recognition that he had been discharged was not necessarily recognition that the discharge was rightful under the terms of the contract. Just as every other employee who was terminated (without regard to whether terminated rightfully or wrongfully or orally or in writing) Canada was entitled to collect his accrued vacation pay and his credits in the savings and profit fund. Had he not collected them he would have been entitled to seek them as damages in this suit. After discharge the policy of avoidable consequences of a wrong required him to make reasonable effort to mitigate his losses. 5A Corbin, Contracts, § 1039. Had he waited and sued for his vacation pay and his credits in the fund he might well have been required to prove he had demanded them.
Thus the oral “agreement” found to have been made by appellant springs from actions which under sound policies of the law he is encouraged to take, and if he does not take may adversely affect his rights.
The plainly erroneous rule is not involved. As a matter of law, actions taken by a discharged employee to minimize his damages cannot constitute an agreement to rescind the contract or waive rights. *5225A Corbin, Contracts, § 1337. In considering the appellant’s opening his own agency the majority recognize that he was bound to mitigate damages. Why the same recognition is not given to appellant’s other actions is not stated.
My brothers find it would be a fraud “to permit Canada to lie low for four and a half years” during which Allstate paid the renewal commissions to his successor. The statute of limitations is five years. The district court found laches is not applicable. If, after the incidents surrounding his discharge, appellant had a cause of action for refusal to allow him to earn the renewal commissions, with damages measured by the renewal commissions that were his under the contract, he could not, except by expiration of the full statutory period, lose his cause by failing to sue.

. The appellee put on no witness to deny Canada’s description of the manner and circumstances of his discharge. Canada’s testimony is the only evidence on the point.

. That Canada turned in his supplies is of no significance. Under a separate provision of the contract, having nothing to do with continuation or termination, he was required to return all supplies on demand. Also it would have been contrary to the interests of Allstate and the public that an insurance agent recognized by himself and the company to be discharged should remain in possession of the forms with which to write unauthorized policies.