Hartline v. Mutual Benefit Health & Accident Ass'n

• Decision Date: 25 April 1938
• Docket Number: No. 8743.,8743.
• Citation: 96 F.2d 174
• Parties: HARTLINE v. MUTUAL BENEFIT HEALTH & ACCIDENT ASS'N.
• Court: U.S. Court of Appeals — Fifth Circuit

96 F.2d 174 (1938)

HARTLINE v. MUTUAL BENEFIT HEALTH & ACCIDENT ASS'N.

No. 8743.

Circuit Court of Appeals, Fifth Circuit.

April 25, 1938.

E. C. Johnson, of Tampa, Fla., for appellant.

R. W. Shackleford, of Tampa, Fla., for appellee.

Before SIBLEY, HUTCHESON, and HOLMES, Circuit Judges.

SIBLEY, Circuit Judge.

The same parties were before us touching the same transaction of health and accident insurance in Hartline v. Mutual Benefit Health & Accident Association, 5 Cir., 84 F.2d 21, 23. It was there held that no contract of insurance was effected by action at the home office, and that the allegations of an oral contract with the agent who solicited the insurance were insufficient because of confusion in them on the point of his authority. After holding that the forms furnished the agent by the association did not show authority to contract and that the agent's assertion of authority would not prove it, we concluded: "But oral contracts of insurance are valid in Florida, and we desire to leave the matter open for a better suit if a case can be truthfully alleged of an ad interim or a final contract of insurance orally made by due authority of the association and in force at insured's death." The present suit was brought accordingly. On a trial, proof of what was done and said was excluded on the ground that there was no sufficient evidence that the agent of the association, Clements, had authority to contract, and a verdict was directed for the defendant.

The evidence showed the same written application signed by Hartline, and premium receipts signed by Clements, which were described in our previous opinion. Clements testified in behalf of the plaintiff that he was a soliciting agent of the association, furnished with blank forms for applications and for premium receipts, and with pamphlets descriptive of various policies. He had no policy blanks. "I was authorized to receive applications for accident insurance and for sick and health insurance. My instructions were to write the applications and collect the first payment and turn the net in to the Company. The first payment would cover approximately three months. * * * I was authorized to fill in the blanks of the application forms. * * * I was furnished with blank receipts to be given when I took money from applicants for insurance." The application form which Hartline signed contained this: "Do you agree that this application shall not be binding upon the Association until accepted by the Association, nor until policy is accepted by the insured while in good health and free from injury? Yes." Attached to the application is a form of recommendation for signature by the "Soliciting Agent" and executed by Clements; and one for signature by the "General Agent" signed by C. B. Pepper. The premium receipt form said: "Received of ________ an application for a policy in the Mutual Benefit Health and Accident Association and $_____. Should the Company decline to issue the insurance applied for, I do hereby agree to return the above sum to said applicant. ________ Agent. This pays your insurance from date on which policy is issued and delivered until _____, 19__. Read other side of this receipt." On the other side is printed: "You should receive notice within ten days from this date that your application has been received at our Omaha office. If it does not reach you within that time please notify us. Mutual Benefit and Accident Association, Faidley Building, Omaha, Nebraska."

There is thus no proof of express authority in Clements to make any contract of insurance, oral or written. He makes himself out only a soliciting agent to get applications. Nor is there proof of ostensible or apparent authority. The Florida court has well defined it thus: "Apparent authority is such as the principal knowingly permits the agent to assume or which he holds the agent out as possessing." Fidelity & Casualty Co. v. Morrison Construction Co., 116 Fla. 66, 156 So. 385, 387. There is here no proof at all that the association knew that Clements had ever assumed the authority of making oral contracts of insurance. The blanks he was given do not hold him out as having it. They all indicate that he as soliciting agent might...