Gosney v. Metropolitan Life Ins. Co.

• Decision Date: 19 August 1940
• Docket Number: 11667.,No. 11666,11666
• Citation: 114 F.2d 649
• Parties: GOSNEY v. METROPOLITAN LIFE INS. CO. BENSON v. SAME.
• Court: U.S. Court of Appeals — Eighth Circuit

114 F.2d 649 (1940)

GOSNEY v. METROPOLITAN LIFE INS. CO. BENSON v. SAME.

Nos. 11666, 11667.

Circuit Court of Appeals, Eighth Circuit.

August 19, 1940.

Ira B. Burns, of Kansas City, Mo. (Paul T. White, of Kansas City, Mo., on the brief), for appellants.

Clay C. Rogers, of Kansas City, Mo. (O. C. Mosman, of Kansas City, Mo., on the brief), for appellee.

Before GARDNER and SANBORN, Circuit Judges, and COLLET, District Judge.

COLLET, District Judge.

Action to recover damages for personal injuries received as a result of the negligent operation of an automobile owned and operated by defendant's soliciting and collecting agent. Plaintiffs' separate actions were consolidated in the trial court and were so presented here. The parties will be referred to as they appeared below. This cause has heretofore been before this Court when it was remanded for a new trial confined to the issue of the alleged liability of the Metropolitan Life Insurance Company. Reference is made to the former opinion for the facts developed at the former trial. See Metropolitan Life Ins. Co. v. Gosney, 8 Cir., 101 F.2d 167. Only such facts as are necessary to the determination of the limited issues presented on this appeal will be stated.

Upon retrial plaintiffs produced testimony to the effect that Mr. Monahan was Assistant Manager in charge of the soliciting agent Kelly, whose negligence caused plaintiffs' injuries; that about ten days prior to the accident resulting in plaintiffs' injuries Mr. Monahan told Kelly to get plaintiffs in his car and sell them some insurance; that again on the morning of the accident Monahan told Kelly to get plaintiffs in his car "and write him (plaintiff Gosney) some insurance this afternoon if he possibly could, over the weekend." That afternoon (Saturday) about six o'clock Kelly came to the place where plaintiffs roomed and undertook to talk to Gosney about buying some insurance. Gosney told him he did not have time to talk to him as he was about to go down town to meet his roommate, plaintiff Benson. Kelly offered to take Gosney to meet Benson. They went downtown in Kelly's car, met Benson and the three started back to Gosney's room, to enable Gosney to get his money with which to pay the first premium on an insurance policy Gosney had just agreed to buy. On the route to Gosney's room Kelly stopped to make a collection for the defendant. After the trip was resumed, with Kelly driving, the accident occurred. Kelly's negligence was established at the former trial and is the law of the case. Neither Gosney's home where Kelly met him on the evening of the accident, the place where Benson was picked up, the place where Kelly made the collection, or the place of the accident were within Kelly's territory or "debit." It is conceded that Kelly was, at the time of the accident, engaged in an effort to sell ordinary life insurance as distinguished from "Industrial Weekly Premium Debit Business."

Defendant was interested only in the result of Kelly's work and not in the method or means of travel used. It did not reserve the right of direction or control over the means or method of transportation used by Kelly. See Metropolitan Life Ins. Co. v. Gosney, supra, and Vert v. Metropolitan Life Ins. Co., 342 Mo. 629, 117 S.W. 2d 252, 116 A.L.R. 1381.

At the conclusion of the evidence the trial court submitted three special interrogatories to the jury which were as follows:

"1. At and shortly before the time when plaintiffs were injured was Willard A. Monahan assistant manager in Kansas City, Missouri, for the defendant, Metropolitan Life Insurance Company, under whom Charles Kelly was working?

"2. Did Mr. Monahan direct Mr. Kelly to get Gosney and Benson in his automobile and to sell them insurance for the defendant Metropolitan Life Insurance Company?

"3. If your answer to question No. 2 is `yes', then you will answer this question: Were plaintiffs injured while riding in Kelly's automobile pursuant to Monahan's direction to Kelly?"

An affirmative answer was returned to each question.

After the return of the special verdict the Court sustained defendant's motion for judgment and entered judgment for defendant upon the grounds that:

(1) "there was a complete failure of proof that Kelly at the time, as the carrier in his automobile of plaintiffs, was the servant of defendant, acting within the scope of his employment. And

(2) "there was complete failure to prove either that defendant's Assistant Manager Monahan, who, the jury found, directed Kelly `to get plaintiffs in his automobile and to sell them insurance for the defendant' had any authority from the defendant to give Kelly any such direction, or that Kelly was under any duty to the defendant to obey any such direction if it were given."

The sole question for determination on these appeals is the accuracy of the above quoted conclusions of the trial court. That question must be determined by the common law of Missouri if the subject is there covered.

Plaintiffs first contend that the trial court was in error in holding that the proof failed to show that Kelly was a servant of defendant and acting within the scope of his employment at the time of the accident. It is asserted that Kelly was acting as a servant of the defendant at the time of the accident.

In Vert v. Metropolitan Life Insurance Company, supra, the Missouri Supreme Court had under consideration the relationship existing between an agent such as Kelly and this same defendant under a contract identical with the one involved here, with the one asserted distinction that Kelly's contract provided that it might be modified.

The contract in the case at bar, absent modification, and the contract in the Vert case being in all material aspects the same, it would be idle to enlarge upon the reasoning forming the basis for the ruling of the Missouri Supreme Court adjudicating the relationship created by that contract, since the conclusion reached by that Court is controlling. The Vert case clearly holds that the relationship created by the contract of employment with the soliciting agent did not create a situation which resulted in responsibility of the defendant for the negligent act of its agent in the operation of the agent's privately owned and personally operated automobile while engaged in the solicitation of "ordinary insurance" outside the agent's debit. The Supreme Court has since reiterated the conclusion reached in the Vert case in the later case of Snowwhite v. Metropolitan Life Insurance Company, 344 Mo. 705, 127 S.W.2d 718.

Mere knowledge of and acquiescence by defendant in Kelly's use of his own automobile in the discharge of his duties is not sufficient to make defendant responsible for its negligent use. Riggs v. Higgins, 341 Mo. 1, 106 S.W.2d 1; Vert v. Metropolitan Life Ins. Co., supra. Neither was there any effort to show that by the nature of the work required by the contract defendant either reserved the right of direction or control, or by implication directed the use of Kelly's automobile. See Riggs v. Higgins, supra.

The trial court correctly ruled that the proof failed to show that Kelly's use of his automobile was at the direction or under the control of defendant at the time of the accident — unless his contract of employment was modified by Monahan.

It is asserted that the conclusion of the trial court was erroneous in holding that the proof failed to show that defendant's Assistant Manager Monahan had any authority to direct Kelly to use his automobile in the performance of his duties or that Kelly was under any duty to follow such direction if it was given.

The contract between defendant and Kelly contained the following provision: "16. My employment as Agent under this contract as well as the duties and emoluments thereunder may be revoked, terminated, changed or modified at any time by the Company in its discretion or at its option." Plaintiffs contend the contract was modified by the Assistant Manager Monahan's direction to Kelly that he use his automobile on this particular occasion. In determining the sufficiency of the evidence we assume that Monahan actually gave the direction to Kelly to use his automobile. The important question is whether the record contains any proof of Monahan's authority to give Kelly such instructions and thereby modify the latter's contract with defendant.

Actual authority may be shown by circumstantial evidence. But when that character of evidence is utilized the resulting authority is none-the-less actual although sometimes characterized as an implied authority. 2 C.J.S., Agency, §§ 91, 99, pp. 1186, 1227. Hall v. Union Indemnity Co., 8 Cir., 61 F.2d 85 (8).

The principal may also be bound by the act of an agent upon principles of estoppel and fair dealing when the principal, or the agent with the principal's consent, commits acts or creates appearances which lead a third party to believe that an agency of a particular character exists. Baker v....