Fass v. Atlantic Life Ins. Co.

• Decision Date: 30 June 1916
• Docket Number: 9413.
• Parties: FASS v. ATLANTIC LIFE INS. CO.
• Court: South Carolina Supreme Court

89 S.E. 558

105 S.C. 107

FASS v. ATLANTIC LIFE INS. CO.

No. 9413.

Supreme Court of South Carolina

June 30, 1916

Appeal from Common Pleas Circuit Court of Dillon County; Hayne F Rice, Judge.

Action by Max Fass against the Atlantic Life Insurance Company. Judgment for plaintiff, and defendant appeals. Affirmed.

The following is the exhibit referred to in the opinion:

Exhibit 1.

This agreement, made this 7th day of November in the year one thousand nine hundred and five, between the South Atlantic Life Insurance Company, hereinafter called the "Company," and Max Fass of Dillon, in the county of Marion and state of South Carolina hereinafter called the "General Agent," witnesseth: That said parties, in consideration of the mutual covenants and agreements hereinafter mentioned, hereby covenant and agree each with the other, as follows, to wit: That the Company do hereby appoint Max Fass as General Agent of the Company, with title of General Agent, for the purpose of canvassing for applications for insurance on the lives of individuals securing, appointing and developing agents and of performing such other duties in connection therewith as may be required by the officers of said Company and that this appointment is made on the following terms and conditions:

(1) The General Agent shall have no authority on behalf of the Company to make, alter or discharge any contract, except contracts with agents (which must be made on forms furnished and approved by the Company) to waive forfeitures or conditions of policies, to extend the time of payment of any premium, or to waive payment in cash. It is further agreed that the General Agent shall have no authority on behalf of the Company to receive any money due or to become due to said Company, except on applications obtained by or through him in exchange for conditional receipts to be furnished by the Company, or on policies or renewal receipts (signed by the president, a vice president, a second vice president secretary or treasurer) sent to him for collection.

(2) The General Agent shall act exclusively as General Agent for the Company, and as such General Agent shall devote his entire time, talents and energies to the business of the Agency hereby established, and in the conducting of it shall be governed strictly by this contract and the book of "Instructions to Agents," issued from time to time by the Company, and by such other instructions as he may receive from the Company. All applications for insurance taken by the General Agent or his subordinate agents, shall be delivered to the Company, whether the same have been reported on favorably or unfavorably by the medical examiner.

(3) The General Agent shall keep regular and accurate statements of all transactions for account of the Company, whether conducted by him personally, or his subordinate agents, and whenever required by the Company, or its authorized representatives, shall transmit to the Company a report in detail, embracing every item of business done by or through him, and of all moneys collected or received by or through him, for said Company.

(4) All books of account, documents, vouchers, and other books or papers connected with the business of said General Agency, shall be the property of the Company, whether paid for by the Company or not, and at any and all times shall be open to the Company or its representative, for the purpose of examination, and shall be turned over to the Company or its representative on the order of the Company, or on termination of said Agency.

(5) All moneys or securities received or collected by the General Agent for or on behalf of said Company shall be securely held by him as fiduciary trust, and shall be used by him for no personal or other purpose whatever, but shall be by him immediately paid over to said Company, in accordance with its instructions; and it is expressly stipulated and agreed between the parties hereto, that in case said General Agent shall withhold any funds, policies or receipts belonging to said Company, after such funds, policies or receipts should have been reported upon and transmitted to said Company, or if he shall withhold any funds, policies or receipts after they shall have been demanded from him in writing by said Company, such dereliction shall work a forfeiture to said Company, unconditionally, of all claims whatsoever, accrued or to accrue under this or any previous agreement to said General Agent, but nothing herein shall be construed to affect any claim of said Company on said General Agent.

(6) The district within which said General Agent shall have permission to operate, is the counties of Marion, Florence, Horry, Georgetown, Williamsburg, jurisdiction not exclusive, such as may be mutually agreed upon from time to time, which territory may be increased or diminished at the pleasure of the Company.

(7) Said general agent shall thoroughly and ably canvass said above-named district; and such territory as may be from time to time assigned to him by the Company.

(8) If in any case said Company shall deem it proper in consequence of misrepresentation made, or misunderstandings had, at the time of the issue of a policy, to return the premiums thereon and cancel it, said General Agent shall lose all right to commissions for premiums under said policy, and shall be bound to repay to said Company on demand, the amount of commissions received on premiums so returned.

(9) The said General Agent shall collect and promptly remit to said Company all premiums on policies not issued through his instrumentality, renewal receipts for which may be furnished him from time to time by the Company.

(10) It is agreed that the necessary expenses for medical examination (except as provided in section 17th hereof), and for the expressage on documents and other things sent by the Company to the General Agent shall be paid by the Company; that the Company shall furnish to the General Agent such a supply of blanks and circulars as it shall deem reasonable, to enable him to carry on the business of his agency, as aforesaid; and the Company shall be liable to pay no charge other than as herein stated, or as shall hereafter be allowed by special written permission of the Company.

(11) The Company may offset against any claim for commissions under this agreement, any debt or debts due at any time by the General Agent to the Company.

(12) The General Agent shall not enter the service of any life insurance company or organization other than the Company, or place any applications for insurance in any other life insurance company or organization, without the consent in writing of the Company, so long as there is any indebtedness of any nature whatever due to the Company.

(13) The ledger account of said party of the first part shall be competent and conclusive evidence of the state of the accounts between the parties hereto. Said Company agrees to furnish to said general agent a copy of said account (not oftener, however, than once a month), upon receipt of written request to that effect from said General Agent, due allowance to be made for clerical delays.

(14) The General Agent shall keep deposited with said party of the first part a bond for the faithful performance of this agreement, and of all duties pertaining to said agency, which said bond shall be for an amount and with security, satisfactory to said Company.

(15) When premiums on policies of insurance effected with said Company by or through said General Agent are collected otherwise than by said General Agent, 2 per cent. of such premiums shall be deducted from the commission to be allowed herein, for expense of collection. Commissions on premiums on all classes of policies not named in section 20th shall be determined by said Company.

(16) In case a policy issued as applied for, shall be subsequently returned by the General Agent as "not taken," the General Agent shall pay to the Company such sum of money as shall cover the expense of issuing such policy.

(17) No rights of said General Agent under this agreement shall be sold or assigned by him without the consent of the Company in writing.

(18) It is expressly understood and agreed between the parties to this agreement, that the same shall be considered strictly confidential, and that under no circumstances shall said General Agent mention or exhibit the terms thereof to any person or persons, under penalty of forfeiture of the same and of all benefits hereunder.

(19) It is agreed that said General Agent shall be allowed, under this agreement, the following compensation only, unless otherwise expressly stipulated in writing, namely: A commission on the original cash premium for the first year of insurance, which shall, during his continuance as said Agent of said Company, and only in this event, be obtained, collected, paid to and received by said Company, on policies of insurance effected with said company, by or through said General Agent, which commission shall be at and after the following rates:

A. On the original cash premium for the first year of insurance on accumulation business with 15, 20, 25 or 30 years accumulation periods, issued at ages 60 and under.

A. Ordinary life ................................... 60 per cent.

B. Twenty"payment life ............................. 60 per cent.

C. Fifteen"payment life ............................ 55 per cent.

D. Ten"payment life ................................ 40 per cent.

E. Endowments, paid by 20 or more annual premiums .. 60 per cent.

F. Endowments, paid by 15 annual premiums .......... 50 per cent.

G. Endowments, paid by 10 annual premiums .......... 40 per cent.

Premium endowment ..................................... 60 per cent.

Nonparticipating ordinary...