Government Personnel Mut. Life Ins. Co. v. Wear

• Decision Date: 06 February 1952
• Docket Number: No. 12290,12290
• Citation: 247 S.W.2d 284
• Parties: GOVERNMENT PERSONNEL MUT. LIFE INS. CO. v. WEAR.
• Court: Texas Court of Appeals

Page 284

247 S.W.2d 284

GOVERNMENT PERSONNEL MUT. LIFE INS. CO. v. WEAR.

No. 12290.

Court of Civil Appeals of Texas, San Antonio.

Feb. 6, 1952.

Rehearing Denied March 5, 1952.

Hubert W. Green, Frank M. Rosson, San Antonio, for appellant.

Trueheart, McMillan & Russell and Wier & Wier, all of San Antonio, for appellee.

W. O. MURRAY, Chief Justice.

This is an appeal by Government Personnel Mutual Life Insurance Company, hereinafter referred to as appellant or as Insurance Company, from a judgment awarding to Gordon Wear a recovery in the sum of $68,630.79 for override commissions on certain insurance, and the further sum of $5,000 as attorney's fees. The judgment also has declaratory features as to future commissions on renewals of policies. The trial was to a jury, but the court disregarded such answers of the jury as were favorable to the Insurance Company and rendered the above judgment, notwithstanding such jury answers. The Insurance Company has prosecuted this appeal.

The above judgment was based upon appellee Wear's claim to override commissions upon insurance policies written by the Insurance Company and solicited by one C. H. Earl and twenty-five of his so-called sub-agents.

Wear's right to recover these commissions depends upon the interpretation to be placed upon three contracts executed on July 1, 1946. For the purpose of designating these contracts we will call them contracts Numbers 1, 2 and 3. Contract No. 1 was between Wear and the Insurance Company and had the effect of appointing Wear a solicitating agent of the Insurance Company and authorizing him to solicit insurance policies for the Insurance Company, for which he was to be paid certain stipulated commissions. Contract No. 3 was a somewhat similar soliciting agency contract appointing C. H. Earl a soliciting agent and authorizing him to solicit insurance for the Insurance Company for which he was to receive certain commissions.

This entire controversy arises under the terms of Contract No. 2. This contract was styled 'Supplemental Agreement' and provided in part as follows: 'The company agrees to pay Gordon Wear the following commission on (premiums paid for) life insurance contracts issued by said company on insurance written (solicited) by C. H. Earl under his contract dated July 1, 1946.' (The parties agree that the inserted words were intended.) Then follows the schedule of percentages to be paid to Wear on the various kinds of life insurance policies to be solicited by Earl.

The first question to be decided is upon what date this Contract No. 2 was terminated. The Insurance Company contends that it was terminated on January 1, 1948, by oral notice given by P. J. Hennessey, Vice-President and General Manager of the Insurance Company to Wear in October, 1947. Wear contends that Contract No. 2 was not terminated until thirty days after written notice of termination or cancellation was given to him on May 28, 1948.

There was no provision within the four corners of Contract No. 2 for written notice of termination, but such a provision is found in Contract No. 1. Appellee, Wear, contends that these two contracts, being executed between the same parties on the same date and relating to the same subject matter and Contract No. 2 being styled 'Supplemental Agreement,' should be read and construed together as one contract, and that when this is done paragraph X of Contract No. 1 became a part of Contract No. 2, and that this paragraph provides for termination only upon thirty days' written notice.

We are well aware of the general rule contended for by Wear. It is well stated in 10 Tex.Jur. § 166, Contracts, p. 286, as follows: 'All written instruments whereby a single transaction is consummated are to be taken and construed together. So, instruments executed at the same time or contemporaneously, for the same purpose, and in the course of the same transaction, are to be considered as one instrument, and are to be read and construed together; and in such case parol evidence is admissible to connect the instruments and to explain any conflict between them.' The authorities are so numerous upon this general proposition that we do not deem it necessary to cite them here.

Appellant, Insurance Company, contends that these two contracts were not executed for the same purpose but had very different purposes; that Contract No. 1 was executed for the purpose of appointing Wear a soliciting agent for the Insurance Company and Contract No. 2 was executed for the purpose of giving Wear, as a general agent of the Insurance Company, override commissions on insurance solicited by Earl under his contract of even date, being Contract No. 3.

Contracts Nos. 1 and 2 do not expressly refer to each other or expressly make one a part of the other. The only thing that might be so construed is the fact that Contract No. 2 is styled 'Supplemental Agreement'; also, it might be mentioned that Contract No. 1 expressly provides in paragraph XVI thereof that: 'this agreement, together with any amendments thereto duly executed constitutes the entire contract between the parties.' This last provision was a stereotyped provision found in all of the soliciting agency contracts executed by the Insurance Company.

We may assume without deciding that Contract Nos. 1 and 2 should be construed together as one contract for the purpose of determining the intention of the parties. This brings us to the question of what is meant by the statement that 'all written instruments whereby a single transaction is consummated are to be taken and construed together.' Does it mean that the several instruments are bodily consolidated into one instrument so that every provision in one instrument becomes a part of every other instrument, or does it mean that such instruments are simply read and considered together so as to arrive at the true intention of the parties in executing the several instruments? We think the latter is correct.

Contract No. 1 and Contract No. 2 are each a complete and separate contract, written on separate pieces of paper and each is signed by the parties. They are not in conflict as to the purpose to be accomplished. The intention of the parties can readily be understood from the language contained within the four corners of each. They mean the same thing, whether you read them separately or together. The only purpose of construing them together is to apply paragraph X in Contract No. 1 to Contract No. 2 and thereby requiring thirty days' written notice of termination of Contract No. 2. This is all that will be accomplished by construing them as one contract. Reading and construing contracts together does not justify bodily taking a paragraph from one contract and transplanting it in the other.

We do not find any Texas case directly in point. In Mechanics' Lumber Co. v. Yates American Mach. Co., 181 Ark. 415, 26 S.W.2d 80, 83, the Court quotes from 6 R.C.L. 852, as follows: 'But construing contemporaneous instruments together, means simply that if there be any provisions in one instrument limiting, explaining or otherwise affecting the provisions of another, they will be given effect as between the parties themselves and all persons charged with notice so that the intent of the parties may be carried out and that the whole agreement actually made may be effectuated. This does not mean that the provisions of one instrument are imported bodily into another contrary to the intent of the parties. They may be intended to be separate instruments and to provide for entirely different things.' 12 Am.Jur., Contracts, § 246, p. 783, is to the same effect.

In Huyler's v. Ritz-Carlton Restaurant & Hotel Co., D.C., 1 F.2d 491, 492, the rule is stated as follows: 'It is true that the principle by which instruments executed at the same time, by the same parties, for the same purpose, and in the course of the same transaction are considered as one, and receive the same construction as if embodied in one instrument, is of wide application and the illustrative cases are many. Elliott on Contracts, § 1522; 6 R.C.L. 851; 13 C.J. 528. But at most that principle is merely a rule of construction to give effect to the intent of the parties. The provisions of one instrument are not thereby imported bodily into another. The application of the rule does not result in actual consolidation of the several contracts. It does not convert a specialty into a simple contract, or a simple contract into a specialty. Each of several instruments may be construed in the light of the others, without their being considered as one for all purposes. Moreover, considering several instruments as one is not the natural construction, and is resorted to only to effectuate the intention. They may be intended to be separate instruments and to provide for different things. Barker v. Sartori, 66 Wash. 260, 264, 119 P. 611; Thorp v. Mindeman, 123 Wis. 149, 101 N.W. 417, 68 L.R.A. 146, 107 Am.St.Rep. 1003, 6 R.C.L. 852. To effectuate the intention of the parties in the case at bar I think that it is not necessary to consider the three instruments as one.'

What was said by Chief Justice Fly of this court in Harris v. G. M. H. Wagner & Sons, Tex.Civ.App., 195 S.W. 351, 352, sheds considerable light on this question: 'The second contract is separate and distinct from the first, which was a contract for raising, gathering, and marketing the onions on 25 acres of land. The last contract was one of purchase alone of the onions on 15 acres of land. There is no provision for appellees to receive 11 cents a crate, over 12 per cent. of the total value, merely for accepting the onions which they had bought from appellee. In the second contract it is provided: 'This instrument to in no way affect previous contract.' If there was any doubt as to the last contract being independent of the former contract, that provision dispels it. It is a separate and distinct contract, totally different from the forer one. It follows...