Robertson v. Malone

• Decision Date: 26 June 1951
• Docket Number: No. 13342.,13342.
• Citation: 190 F.2d 756
• Parties: ROBERTSON v. MALONE, Insurance Commissioner.
• Court: U.S. Court of Appeals — Fifth Circuit

190 F.2d 756 (1951)

ROBERTSON v. MALONE, Insurance Commissioner.

No. 13342.

United States Court of Appeals Fifth Circuit.

June 26, 1951.

Harrold Carswell, Tallahassee, Fla., for appellant.

Leo L. Foster, Tallahassee, Fla., for appellee.

Before HOLMES, McCORD and RUSSELL, Circuit Judges.

RUSSELL, Circuit Judge.

The cause from which this appeal arises was a suit by the appellee Insurance Commissioner of Pennsylvania, and as such statutory liquidator of the Keystone Mutual Casualty Company (dissolved), seeking to recover from the defendant upon a stated account of premiums alleged to have been collected by him on numerous specified policies under the terms of an agency contract.¹ The total sum claimed to have been withheld was $5,996.03. Appellant Robertson had been the agent at Tallahassee of the Keystone Mutual Casualty Company prior to the time the company failed and its assets were taken over by appellee as statutory liquidator under the laws of Pennsylvania.

In his first answer, sworn to by Robertson, and signed by Weaver and Cook as attorneys for the defendant, the defendant admitted "that he withheld monies collected by him belonging to Keystone Mutual Casualty Company (dissolved) two or three months prior to its being declared insolvent, but as to exact amount withheld he does not know. Said monies were withheld from said company by defendant in the belief said company would soon be declared insolvent and that would be his only chance to collect monies due him by said company for services hereinafter set out." The defendant alleged an indebtedness due him by the plaintiff in the amount of $5,253.00 representing fees and expenses under an alleged agreement whereby the defendant was employed as an adjuster of certain claims against the Casualty Company. He likewise sought recovery of $1,345.88 said to have been paid to another agent to whom he transferred certain of the business at the suggestion of the Casualty Company shortly prior to its being declared insolvent. Judgment was prayed for these sums, against which the defendant offered to have set off plaintiff's demand, with judgment in his favor for the balance. In answer to the cross-claim the plaintiff asserted it failed to state a claim upon which relief could be granted; denied the indebtedness; and alleged that if defendant had any claim it was incumbent upon him to file it in the liquidation proceeding in compliance with the Laws of the State of Pennsylvania, averring that the allowance of any set off would grant defendant a preference over other claimants; and further, denied the agreement or performance of the services claimed. Thereafter, the defendant amended his answer and counterclaim and in an answer, filed by the same attorneys and sworn to by the defendant, denied indebtedness and asserted detailed and specified errors and inaccuracies aggregating $2,800.53 in the claim of the plaintiff.

As appears from the record, at a pre-trial conference held on January 31, 1950, plaintiff admitted error in the item of $1,345.88, and the defendant claimed the total errors above referred to, in the amount of $2,800.53. The Court made a pre-trial memorandum, (which was not signed, but which was filed), with reference to the claimed and disputed items, which stated the issues in the case remaining for trial to be: (1) claimed errors in account stated $1,454.64; (2) defendant's counterclaim of $5,253.00. The case was assigned for trial on February 27, 1950. On February 13, 1950, Weaver and Cook, defendant's counsel of record, filed a motion asking permission of the Court to be released as such counsel. On February 14th, this motion was brought before the Court, pursuant to notice given February 7th, and the Court permitted counsel to withdraw. It was provided that the withdrawal should "have no effect upon the scheduled trial of the cause on February 27th, 1950 at ten o'clock, A.M." Defendant appeared at the trial without counsel, and presented a motion for continuance on the ground that both he and his wife, who was partially familiar with the business of the Insurance Agency, were physically unable to participate in the trial, and upon the further ground that he had been unable to secure counsel. Affidavits as to the physical condition of his wife, dated February 1, 1950, and as to the defendant, dated February 2, 1950, were presented as a part of the motion. The Court overruled the motion.

The defendant conducted his own defense and presented his counter-claim. It appeared that the items representing the agent's collections, constituting the account sued upon, had been ascertained by an audit of the defendant's records, which, he had stated to the auditor, showed his collections and disbursements. The making of the statement was admitted, but the actual correctness of records was denied by the defendant upon the trial. The defendant tendered cancelled checks payable to the Casualty Company, which he contended constituted payment of the entire account. One of the checks ante-dated any item of the account sued upon. It is not clear to what the other related. The theory of payment by the checks was inconsistent with the correctness of the defendant's books, upon which the account had been formulated. In his testimony the defendant attempted to explain this discrepancy, but the explanation was not required to be believed by the trial Court. The Court permitted the testimony of Mrs. Robertson to be taken by deposition and it was considered along with the oral testimony.

The Court concluded that the plaintiff had failed to carry the burden of proof as to the disputed items totalling $1,454.65 and that this, added to the admitted error of $1,345.88, a total of $2,800.53, should not be recovered. This ruling allowed the defendant credit for every item of collection in dispute, but did not accept his contention of payment by checks. Judgment was accordingly entered for plaintiff in the amount of $3,195.50. The Court held the counter-claim improper and disallowed it, without prejudice to defendant's right to assert it as an independent claim in the liquidation proceedings in Pennsylvania.

Following the entry of judgment, the defendant retained counsel. A motion for new trial was filed, and overruled, and this appeal follows. The assignments of error are now to the effect that since the checks tendered raised a presumption of payment, in the absence of any evidence in rebuttal, the Court was required to have adjudged payment to have been made; that the action of the Court...