American Life Ins. Co. v. Shell

• Decision Date: 13 September 1956
• Docket Number: 6 Div. 958
• Citation: 265 Ala. 306,59 A.L.R.2d 917,90 So.2d 719
• Parties: , 59 A.L.R.2d 917 AMERICAN LIFE INSURANCE CO. et al. v. Claude SHELL.
• Court: Alabama Supreme Court

Page 719

90 So.2d 719

265 Ala. 306, 59 A.L.R.2d 917

AMERICAN LIFE INSURANCE CO. et al. v. Claude SHELL.

6 Div. 958.

Supreme Court of Alabama.

Sept. 13, 1956.

Rehearing Denied Nov. 29, 1956.

Noble J. Russell, Decatur, and Deramus, Fitts, Johnston & Mullins, Birmingham, for appellants.

Hare, Wynn & Newell, Birmingham, and Ling & Bains, Bessemer, for appellee.

STAKELY, Justice.

This is a suit for libel by Claude Shell (appellee) against the American Life Insurance Company and its President, Thomas W. Wert (appellants), for publishing the following alleged defamatory matter by writing it in a letter to the plaintiff and sending a copy thereof to a Mr. Forsyth, a business associate of the plaintiff. The letter is as follows.

'American Life Insurance Company

'Birmingham 3, Alabama

'September 20, 1952

'Thomas W. Wert

'President

'Mr. Claud Shell

'Bueno Vista Hotel

'Biloxi, Mississippi

'Dear Sir:

'On September the 4th, I wrote you that I had been informed that you stated to one Forsyth, that after you brought the $15,000.00 suit against the American Life we paid you $10.00 in settlement of the suit, but that this check was blind and we passed to you under the table $15,000. You have not replied to my letter.

'Now if you or anyone else makes the statement that we paid you any sum whatsoever than the $10.00 check, directly or indirectly you are an infamous liar and a cowardly cur and knew you were lying when such statement was made.

'Yours etc.,

'/s/ Thos. W. Wert.'

The case went to the jury on Counts AA as amended, BB as amended and CC as amended. Count AA as amended alleges that the letter made the basis of the law suit was published at Mr. Pleasant, Texas, where it was read by one Forsyth. In addition to alleging that Forsyth read the alleged libelous letter, a copy of which is attached to and made a part of Count AA as amended, the plaintiff further alleges in Count AA as amended that he suffered special damage to his earning capacity and his reputation was impaired.

In Count BB as amended plaintiff adopts all of Count AA as amended and adds thereto certain allegations with respect to an alleged cancellation by one Forsyth of an agency contract which Forsyth allegedly had entered into with an insurance company of which plaintiff was general agent.

Count CC as amended is substantially the same as Count AA as amended except that Count CC as amended seeks to set up publication in Birmingham, Alabama.

All three of the counts on which the case went to the jury contained allegations showing that the word 'we' in the letter referred to Thomas W. Wert and American Life Insurance Company, a corporation. In each count it was further alleged that 'It was known to said Forsyth when he received said copy of said letter that the plaintiff had made the statement that 'we' (meaning Thomas W. Wert or the American Life Insurance Company or both) had paid him a sum other than said $10.00 check directly or indirectly. * * *' Trial of the case resulted in a verdict for the plaintiff in the sum of $35,260. There was a motion for a new trial which the court overruled. The appeal here is from the judgment and the ruling of the court on the motion for a new trial.

I. It is argued by the appellants that the epithets applied to the plaintiff in the complaint were conditional, being prefaced with the statement, 'Now if you or anyone else makes the statement that we paid you any sum whatsoever than the $10.00 check * * *.' It is the position of the appellants that the charge being conditional in its form, there is no actionable quality in the charge.

Our investigation fails to show any Alabama case which throws any light on the question here presented and there are only a few cases so far as we can ascertain where the courts have dealt with the subject. The appellants rely on a case decided in 1842, McKee v. Ingalls, 4 Scam. 30, 5 Ill. 30. We feel, however, that the rule stated in 53 C.J.S., Libel and Slander, § 9, p. 47 is the rule which we should apply. We quote the rule as follows.

'In conditional form. Where the charge is conditional in its form, the actionable quality of the imputation depends on the facts assumed in the conditional clause; and, if defendant makes the charge to depend on a fact which he has stated conditionally but which is known to be true, it is equivalent to a direct charge and actionable.'

In all of the counts on which the case was tried it is alleged as follows: 'And plaintiff avers that it was known to the said Forsyth when he received said copy of said letter that the plaintiff had made the statement that 'we' (meaning Thomas W. Wert or the American Life Insurance Company or both) * * *.', had paid him a sum other than said $10 check directly or indirectly. Accordingly, we consider that in view of the context alleged, which is that Forsyth knew the charge to be true, it is a plain assertion that the plaintiff was 'an infamous liar and a cowardly cur and knew you (the plaintiff) were lying when such statement was made.' Clark v. Zettick, 153 Mass. 1, 26 N.E. 234; Ruble v. Bunting, 31 Ind.App. 654, 68 N.E. 1041. Although we are dealing here with a question of pleading, it may be well to note in order that the case may be better understood that the court not only required the plaintiff to plead that the condition was met but also required proof tending to show that the condition was met and so charged the jury in the oral charge.

Upon a careful consideration of the matter we, therefore, are of the opinion that the court was not in error in overruling the demurrer to the foregoing counts of the complaint which raise the point that the charge was conditional and therefore not actionable.

II. Plaintiff's evidence tended to show that when Forsyth, who is referred to in the letter which is made the basis of the suit, got a copy of this letter, he terminated his business association with the plaintiff, whereby the plaintiff claims to have suffered a great business loss. This claim for special damages is set up in Count BB as amended.

The proof of the plaintiff tended to show that on May 1, 1952, a written contract was executed between Southern States Life Insurance Company on the one hand and Claude E. Shell (plaintiff here) on the other, designating Shell as General Agent for Southern States Life Insurance Company and agreeing to pay him 75% of commissions on the type of insurance therein described. On September 4, 1952, there was executed a written contract wherein the Southern States Life Insurance Company was the company and Claude E. Shell was the General Agent and C. M. Forsyth, the agent, and specifying therein that C. M. Forsyth, the agent, would be paid a commission equaling 60% of the same commissions on the same type of insurance when and as produced by Forsyth, thereby leaving to Shell his over-riding commission of 15% of premiums of insurance as produced by Forsyth under the aforesaid contract of September 1952. It is claimed that as a proximate consequence of the publication of the aforesaid libel, Forsyth cancelled the aforesaid written contract of September 4, 1952, thereby depriving the plaintiff of the over-riding commission of 15% of all insurance premiums upon insurance when and as produced by Forsyth under said contract. This is the loss which the defendants claim to be conjectural and speculative in nature and for that reason not recoverable and of which the court allowed proof.

Forsyth testified in the case. His testimony tends to show the circumstances upon which it could be calculated with reasonable accuracy what the plaintiff would have earned under his agency contract. The testimony of Forsyth tended to show that he had taken the same crew of men who were serving him at the time he terminated his relationship with the plaintiff and put them to work selling insurance for another insurance company, the Anchor Life Insurance Company, under circumstances which were substantially the same, thereby proving by actual results what was capable of being produced by the agency force which was lost to the plaintiff as the result of the wrongful act of the defendants. His testimony tended to show that the $250,000 of premiums income which he did produce in the next six months was almost exactly the same which he and his crew of men could have produced under the agency contract with the plaintiff had it not been cancelled.

The various elements which made up the substance of Forsyth's testimony were brought out, including the names of the salesmen, the clauses in the policies, the type of prospects who would be approached and the sales commissions. It was shown that Forsyth and his crew specialized in selling what is termed 'military insurance'. In this type of insurance on proper authorization the government deducted the amount of the premiums from the pay of the man in the service and sent in the premiums. It was shown that 2,750 applications were procured of a potential premium income of about $300,000, which would be $120 a year per policy or $10 per month. This type of insurance had a ready sale and when all of the men in some particular camp had been solicited the crew started working again on that camp when a new group of men came into the camp. It was shown that this type of insurance was sold for the Anchor Life Insurance Company and was comparable to the type of insurance sold by Southern States Life Insurance Company, because the policies were substantially the same, the territory was comparable and the conditions for the sale of such insurance were in other respects comparable.

Upon a careful consideration of the matter we feel satisfied that the proof was admissible to give the jury a basis upon which the amount of plaintiff's loss could be estimated. If the testimony of the plaintiff was believed by the jury, the jury had the right to find that the defendants by their wrongful act destroyed the plaintiff's life insurance agency and having done this cannot then claim...