Court Opinion

ID: 9713080
Source: CourtListenerOpinion
Date Created: 2023-08-26 05:07:09.622842+00
Date Added: 2024-06-11T18:23:16.434602
License: Public Domain

Armstrong, J.
(with whom Hale, C.J., joins, concurring in part and dissenting in part). The trial judge found that the plaintiff, on or shortly after June 13, 1974, "called Colony and was assured by them that she could make her payment after June 24, which she did.” In context, the finding implies that the plaintiff was given an assurance that her policy would not be cancelled on June 24, the stated effective date of the notice of cancellation previously mailed, and that she was to have a reasonable time thereafter to pay Colony the $42.86 then owing.1 This critical finding is nowhere challenged by Colony; its two briefs ignore the finding; and we are in no position to conclude that it was not supported by the evidence, much of which has not been reproduced in the appendix. It follows from that finding that Colony’s cancellation of the *132policy under the power of attorney given the holder2 of the plaintiffs note by the terms thereof was wrongful, and on general principles Colony is liable for the damages flowing from that wrongful cancellation. As to the measure of those damages, we concur in the majority opinion.
There is nothing in the judge’s findings, however, which indicates that either Empire or its agent, Main, is liable for damages resulting from cancellation of the policy. The theory upon which the majority holds Empire liable — namely, that it had no right to cancel the policy for "non-payment of premiums”3 when its agent Main held money owing to the plaintiff sufficient to bring the premium payments up to date — is inapplicable for at least two reasons: first, it was the insured (acting through her attorney, the holder of the note) and not Empire who cancelled the policy, the cancellation having been for the purposes of obtaining return of the unused portion of the premium;4 and, second, whatever preliminary discussions may have taken place, the plaintiff signed a note which plainly disclosed that only $73.80 of her down payment had been applied to the insurance premium and which obligated her to pay $30.94 on the first day of each month for eight consecutive months. On the facts found, that note was not the product of fraud or mutual mistake; and neither the fact that the plaintiff may not have read the note at the time she signed it (Cohen v. Santoianni, 330 Mass. 187, 193 [1953]) nor the fact that Main may be *133obligated to return to her the $35 which it, without authorization, applied to renewing her membership in the automobile club altered her obligation to make the monthly payments she promised to make by signing the note.
Main cannot be held liable on the theory, advanced by the majority, of tortious interference with contract, because Main had nothing whatever to do with effecting the cancellation of the policy.* ****5 Nor can Main’s liability be predicated on its having been Empire’s agent; for even if we assume, contrary to the facts found by the judge, that it was Empire which cancelled the policy and that Empire thereby breached the insurance contract, Main would not be similarly liable. The agent of a disclosed principal is not ordinarily personally liable for his principal’s breach of contract (see Restatement [Second] of Agency § 320 [1958]; 16 Appleman, Insurance Law & Practice § 8832 [1968] at 459-461; Keeton, Insurance Law [1971] at 51), unless the breach is the result of the agent’s own fraud. The trial judge made no finding of fraud,6 and fraud is not to be presumed. Cohen v. Santoianni, supra at 192. Stow v. Commissioner of Corp. & Taxn., 336 Mass. 337, 341 (1957). Gifford v. Gifford, 354 Mass. 247, 248 (1968).
*134As to the defendants Main and Empire, we concur in those portions of the majority opinion dealing with the judge’s refusal to award the plaintiff $100 damages and attorney’s fees under G. L. c. 140C, § 10(6). The defendant Colony is not similarly liable. It is clear from the judge’s findings and from the evidence and the terms of the note that Colony did not become the plaintiffs creditor until the note was assigned by Main to Colony, and that Colony was not a "creditor” at the time Main violated the disclosure requirements of G. L. c. 140C and G. L. c. 255C. The judge’s finding or conclusion that Main was Colony’s agent was plainly wrong. There was no evidence that Colony had given Main actual authority, express or implied, to enter into business transactions in Colony’s behalf, and no ostensible or apparent authority could be found from the note which,' on its face, plainly indicated that Colony would become a party to the transaction only if and when Main should assign the note to it. The fact that Main regularly assigned such notes to Colony furnished no basis for a conclusion that Colony was Main’s principal (see Anderson Uniform Commercial Code § 3-302:14, at 827 [2d fed. 1971]); to the contrary, if such a relationship existed, Colony would be payee from the outset and assignment would be superfluous. Colony was a stranger to the transaction at the time the truth-in-lending violations occurred and thus is not liable to the plaintiff for the statutory penalty. Contrast G. L. c. 140C, § 10(c). See now G. L. c. 140C, § 10(g), inserted by St. 1975, c. 592, § 11, effective September 6, 1975.

 Failure to comply with the requirement of G. L. c. 255C, § 20, that an agreement to extend the time for making an installment payment must be in writing and signed by the parties, would bar collection of a deferment charge for such an extension but would not otherwise affect the validity of an extension.

 Colony was a "holder” under the Uniform Commerical Code definition (G. L. c. 106, § 1-201[20]) because the assignment, being written on the face of the note, was in legal effect an indorsement. Mass. Ann. Laws c. 106, § 3-202(4), & Comment 5 (1976). See cases cited in 11 Am. Jur. 2d § 356 (2d ed. 1963).

 The terminology is misleading. The premium was fully paid at the outset, when the plaintiff signed the note. New England Acceptance Corp. v. American Manufacturers Mut. Ins. Co., 4 Mass. App. Ct. 172, 179 (1976), S.C. 373 Mass. 594 (1977). What gave rise to the controversy was the plaintiffs failure to make the payments called for by the note.

 Colony forwarded to Empire the statement required by G. L. c. 90, § 34K, and Empire was entitled to rely on that statement.

 Parenthetically, we do not understand how a theory of tortious interference with contract can have any application to Colony, because the latter, in cancelling the contract, was simply trying to protect its own economic interest by exercising its contractual right to apply any available return premium to a note in default. See Prosser, Torts § 129, at 944-945 (4th ed. 1971); 1 Harper & James, Torts 514-516 (1956).

 The findings were that the plaintiff intended the entire initial payment ($108.80) to be applied to the insurance premium and that she did not ask to have her membership in the auto club renewed. There were no findings that Main knew when it applied $35 of the initial payment to renewal of the auto club membership that that was contrary to her intention or that she instructed Main at any time not to renew that membership.