Egan v. Massachusetts Bonding & Ins. Co.

• Decision Date: 28 February 1929
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court
• Parties: EGAN v. MASSACHUSETTS BONDING & INSURANCE CO.

266 Mass. 270

165 N.E. 386

EGAN

v.MASSACHUSETTS BONDING & INSURANCE CO.

Supreme Judicial Court of Massachusetts, Suffolk.

Feb. 28, 1929.

Exceptions from Superior Court, Suffolk County; Winfred H. Whiting, Judge.

Action by Henry J. Egan against the massachusetts Bonding & Insurance Company, with trustee process. Verdict for plaintiff, and defendant brings exceptions. Exceptions sustained, and judgment rendered for defendant.

W. Flaherty and A. E. Pinanski, both of Boston, for plaintiff.

J. C. Reilly of Lowell (J. W. Flood, of Boston, of counsel), for defendant.

SANDERSON, J.

The plaintiff brings this action upon an account annexed to recover a commission, as broker, on the fourth annual premium, payable in 1922, on a bond executed by the Hugh Nawn Contracting Company, as principal, and the defendant, as surety. The bond runs to the Board of Water Supply of the City of New York, as obligee, and covers the construction of a dam.

Before 1912 the plaintiff had been an employee of the defendant, and when terminating the employment the defendant's president offered to pay him a commission of twenty-five per cent. on all business, including bonding and insurance, procured by him for it. During the years 1912 to December, 1919, the plaintiff procured for the defendant bonding contracts of the Hugh Nawn Contracting Companyand others, and uniformly received a commission of twenty-five per cent. on premiums paid therefor. He testified that the custom of surety companies, when business was written through a broker, was to charge the premium to the broker, who would send a bill for the amount due to the assured and, after making collection and deducting his commission, remit the balance to the surety company. This custom prevailed in practically every transaction from 1912 to November, 1919, between the plaintiff and the defendant, the plaintiff never being paid his commission until the premium had been paid by the assured. It was the universal custom for the broker to collect from the assured, deduct his commission and forward the balance to the surety company. In each instance before the one now under consideration where the Hugh Nawn Contracting Company was the party insured, the plaintiff collected the premiums as they became due and made remittances to the defendant, and, in doing this, acted as agent for the defendant. The plaintiff further testified that he never had a contract with the defendant relative to commissions on insurance business; that he wrote business for it in the same way he would write it for other companies, his transactions with the defendant being carried on in the ordinary course of business.

The first premium due on the bonding contract in question was charged on the books of the defendant to the plaintiff, and in July, 1919, it sent a bill to him for the amount, with other items not material to the case. The plaintiff asked for and received a separate bill for this one item. Evidence was introduced which would justify a finding that before this premium was paid by the assured the defendant had notified the plaintiff that he was relieved from any duty to collect the premiums on this bond, and that it undertook to collect them without the aid of the plaintiff. None of the annual premiums on this bond, after the first, was charged to or collected by the plaintiff. In January, 1920, the plaintiff wrote the defendant that he had been advised that the first premium had been paid, and asked for a check for his commission. This commission was paid and before the trial the plaintiff had also been paid a commission on the annual premiums for 1920 and 1921, and there is no contention that these commissions were paid before the defendant had received the premiums for those years. The defendant's motion for a directed verdict was denied, and the jury found for the plaintiff.

In reaching that decision they had a right to take the view of the evidence most favorable to the plaintiff. Reed v. Edison Electric Illuminating Co., 225 Mass. 163, 164, 114 N. E. 289;Marsal v. Hickey, 225 Mass. 170, 173, 114 N. E. 301;Margeson v. Town Taxi, Inc. (Mass.) 165 N. E. 20. The parties were limited to the issues presented by the pleadings. Snowling v. Plummer Granite Co., 108 Mass. 100;Wood v. Sherer, 186 Mass. 562, 563, 71 N. E. 947. ‘Under the common counts in indebitatus assumpsit at common law, or under a count on an account annexed under the new Practice Act [G. L. c. 231, § 7, subd. 9], the plaintiff may recover either money due under a special contract which has been fully performed, or the value to the defendant of work done and materials furnished under it.’ Gray, C. J., in Cullen v. Sears, 112 Mass. 299, 308;Fisher v. Doe, 204 Mass. 34, 38, 90 N. E. 592. When work under a special contract is fully performed and nothing remains to be done but the payment of money, recovery may be had on a count on an account annexed. Fish v. Gates, 133 Mass. 441. But even if the plaintiff's part of the contract has been performed he cannot recover on such a count if payment was not due when his action was begun. Hutchinson v. Plant, 218 Mass. 148, 155, 105 N. E. 1017;Stuart v. Clark, 259 Mass. 383, 387, 156 N. E. 739. The plaintiff's contention is that the contract has been fully performed on his part and that nothing remained to be done under it but the payment of money by the defendant. He could not recover, and is not seeking to recover in this form of action, damages for breach of contract. Lowe v....