Court Opinion

ID: 3711510
Source: CourtListenerOpinion
Date Created: 2016-07-06 06:46:08.425789+00
Date Added: 2024-06-11T15:44:18.214426
License: Public Domain

I am unable to concur in the opinion of the majority of this court, which rendered final judgment in favor of plaintiff in error. The nature of the dispute between the parties has been fully set forth in the majority opinion. Some of the principles enounced therein I do not disagree from. There is but one point of difference. We are called upon to construe paragraph nine of the Agreement, called "Sub-Agent's Contract," which is the agreement between The Fred P. Thomas Company and Raymond M. Weil. It reads as follows:
"The Sub-Agent shall pay to the Agent, on or before the 10th day of each month, all premiums written for or through the Sub-Agent during the second preceding *Page 546 
month, in accordance with monthly statement rendered by the Agent to the Sub-Agent. In the event of credits to the Sub-Agent, arising from cancellations, these credits shall be allowed to the Sub-Agent in the statement for the month in which the cancellation actually occurs, and not before."
What was in the contemplation of the parties when paragraph nine was inserted into the contract? Unquestionably it was the intention that the sub-agent, Raymond M. Weil, was to be held personally for all policies written for or through him. Apparently The Fred P. Thomas Company did not wish to depend upon the contingency of non-payment of premiums by anyone who purchased an insurance contract from the sub-agent. The Fred P. Thomas Company looked to Raymond M. Weil for the payment of all such premiums on insurance contracts written for or through him and by him sold to his customers. On the other hand, the sub-agent was to collect the premiums from his customers on all such policies sold by him. In the event of cancellation of policies credits were to be allowed to the sub-agent in his monthly statement. In effect and substance Raymond M. Weil was the purchaser of contracts of insurance which he in turn sold to his customers. When these contracts of insurance for which Raymond M. Weil became personally liable were delivered to him, he had a right to contemplate that the instruments in writing were in fact what they purported to be; that the duration of time specified in the policy during which these contracts of insurance were to have force and effect would be the life of the policy. He did not intend to bind himself personally to pay for policies which through no fault of his would cease to exist.
Much discussion was had in the briefs and arguments of counsel as to the meaning of the term "cancellations." As I view it, the insolvency and consequent *Page 547 
receivership of the insurance company amounted in law to a breach of contract on the part of the insurance company. Raymond M. Weil was in no way responsible for this condition of the insurance company, nor did any act of his contribute thereto. It seems to me, in so far as Weil is concerned, that there was a failure of consideration; that the instruments in writing purporting to be contracts of insurance for a definite term of years turned out not to be such contracts of insurance because of the insolvency and subsequent receivership of the insurance company. He obligated himself to pay for contracts of insurance, which are in fact in accordance with the terms and tenor thereof only. Raymond M. Weil collected some of the premiums from his customers. The extent of these collections is left in doubt in so far as the record is concerned. One may reasonably be led to the conclusion that there are some premiums which were not collected by him. As to the premiums which he actually collected, it was perfectly equitable that he should be held to his agreement to pay for same. So far as he is concerned these transactions are fully completed. If the purchasers of the insurance policies could legally have recourse against Raymond M. Weil personally for a return of the premiums which he collected from them on their policies, which ceased to exist, it would perhaps be entirely equitable not to hold Raymond M. Weil to his obligation to personally pay for such policies delivered to him and in turn sold by him.
The trend of authority seems to be that the agent is not liable to the insured for a refund of unearned premiums, upon cancellation. To enable him to set off unearned premiums against his own obligation to pay for the policies delivered to him, while he is retaining the premiums collected by him on such policies, would be wholly inequitable. As to those policies sold by him to his customers, wherein the premiums were not *Page 548 
collected by him, he should be allowed to avoid his obligation to pay for same, because the policies which were delivered to him purported to have a definite duration of time — a life of a definite number of years. These policies were not what they purported to be, because of the insolvency and subsequent receivership of the insurance company.
To accomplish an equitable accounting this case should be remanded to the Common Pleas Court for an ascertainment of the vital fact, namely, the extent of the premiums actually collected by Weil. The rendering of final judgment against Weil would obligate him to pay for policies wherein the premiums were not collected by him. This was not in the contemplation of the parties when Raymond M. Weil entered into a personal obligation to pay the premiums.
I, therefore, concur in the order of reversal, but dissent from the entry of final judgment.