Interstate Life & Accident Ins. Co. v. Ruble

• Decision Date: 06 April 1931
• Docket Number: 29280
• Citation: 133 So. 223,160 Miss. 206
• Parties: INTERSTATE LIFE & ACCIDENT INS. CO. v. RUBLE
• Court: Mississippi Supreme Court

133 So. 223

160 Miss. 206

INTERSTATE LIFE & ACCIDENT INS. CO. v. RUBLE

No. 29280

Supreme Court of Mississippi

April 6, 1931

Division B

(Division B)

1 INSURANCE. General agent of insurance company, in consideration of writing insurance, had authority to bind company by agreement that premiums might be paid by discharging board bill owed by subordinate agent to insured (Code 1930, section 5196).

Under section 5196, Code of 1930, a general agent of an insurance company authorized to accept premiums and deliver policies on behalf of the company may make an agreement binding upon the company in consideration of writing of insurance to pay a debt owed by an agent of the company for board during the existence of the agency.

2 INSURANCE. Act of agent of insurance company within line of its powers-binds company (Code 1930, section 5196). Section 5196, Code of 1930, is broader in its scope than the general law of principal and agent and makes the act of the agent within the line of his powers the act of the company.

3. CONTRACTS. It is not contrary to public policy for corporation to contract to pay expenses of agents employed in developing its business.

It is not contrary to public policy of this state for any corporation to make contracts to pay the expenses of agents employed by them in the development of their business.

HON. W A. WHITE, Judge.

APPEAL from circuit court of Harrison county, HON. W. A. WHITE Judge.

Action by Willie Warren Ruble against the Interstate Life & Accident Insurance Company. Judgment for plaintiff, and defendant appeals. Affirmed.

Affirmed.

Gardner, Brown & Backstrom, of Gulfport, for appellant.

Section 2615 of the Code of 1906 (Section 5873 of Hemingway's Code of 1927) does not enlarge the powers and authority of insurance agents beyond that conferred by law on agents of other persons and corporations and beyond the powers and authority conferred by the appellant on its agents.

The powers possessed by agents of insurance companies, like those of any other corporation or of an individual principal are to be interpreted in accordance with the general law of agencies. No other or different rule is to be applied to a contract of insurance than is applied to other contracts. The agent of an insurance company possesses such powers only as have been conferred verbally or by the instrument of authorization, or such as third persons had a right to assume that he possesses under the circumstances of each particular case.

Life Insurance Co. v. Bouldin, 100 Miss. 660, 56 So. 609; New York Life Insurance Company v. O'Dom, 100 Miss. 219, 56 So. 379.

An agent who is empowered to issue policies and make contracts of insurance is the general agent of the company, and, being a general agent, can waive conditions and forfeitures, and do any other thing which his principal can do.

Insurance Company v. Sorsby, 60 Miss. 14; New York Life Ins. Co. v. O'Dom, 100 Miss. 219, 56 So. 379.

A soliciting agent for a life insurance company is without authority to write policies or bind the company by its terms or alter them, and is merely a special agent, whose authority is entirely dissimilar from that of fire insurance agents.

Continental Casualty Company v. Hall, 118 Miss. 871, 80 So. 335.

While an insurance agent, with full authority, may, under many circumstances waive performance of conditions precedent, yet no case has been found where a confessedly unwarranted assumption of authority was first held to be conferred through acquiescence, and then an unauthorized waiver by the self-constituted agent was declared obligatory upon the principal, who, admittedly, had never heard of, or acquiesced in the waiver.

Co-operative Life Association v. McConnico, 53 Miss. 233.

In the absence of provisions in the policy or contract of insurance permitting payment in some other manner, premiums are payable in cash, and an agent has no implied authority to accept payments except in cash.

32 C. J. 1201; Hoffman v. John Hancock Mutual Life Ins. Co., 92 U.S. 161, 23 L.Ed. 539; Batson v. Fidelity Mutual Life Ins. Co., 155 Ala. 265, 46 So. 578, 130 Am. St. Rep. 21.

An insurance agent has no apparent authority to cancel his own indebtedness to another in payment of a premium due on an insurance policy by the latter to the insurance company represented by the agent; that where such an understanding is entered into, but no remittance is made by the agent to the insurance company, and no actual tender of cash is made by the insured to the agent of the insurance company, no valid payment of the premium can be predicated thereon.

Briggs v. Collins, 167 S.W. 114, L. R. A. 1918A, 686 and note; Forebee v. North Carolina Mutual Home Insurance Co., 68 N.C. 11; Sullivan v. Germainia Life Insurance Co., 15 Mont. 522, 39 P. 724; Lycoming Fire Insurance Co. v. Storrs, 97 Pa. 354; Folb v. Fireman's Insurance Co., 133 N.C. 179, 45 S.E. 547; Mutual Benefit Life Insurance Co. v. Nicoll, 9 Ky. Law Rep. 713; Mutual Life Insurance Co. v. Davidge, 51 Tex. 244; Merchants & Manufacturers Insurance Co. v. Baker, 4 Nebr. 384, 94 N.W. 627; Clingerman v. Pleasant, 18 Pa. Co. Ct. 203; Haupt v. Cravens, 56 Tex. Civ. App. 253, 120 S.W. 540; Hawley v. Michigan Mutual Life Insurance Co., 92 Iowa 593, 61 N.W. 201; Allen v. Metropolitan Life Insurance Co., 229 N.W. 879.

In all of the cases examined by us we can find no warrant for holding that a principal can be bound by the unauthorized acts of his agent, and known to the party dealing with the agent, to be in direct violation of the instructions of the principal.

Mississippi Electric Company v. Hartford Fire Insurance Company, 105 Miss. 767, 63 So. 231.

While the knowledge of an agent is ordinarily imputed and charged to his principal, it appears to be well established at the present day that there is an exception to the imputation of notice from the agent to the principal in cases of such conduct on the part of the agent as to raise a clear presumption that he would not communicate the fact in controversy; as where the agent, acting nominally as such is in reality acting in his own or another's interest, and adversely to that of his principal; or where the communication of such a fact would necessarily prevent the consummation of a fraudulent scheme which the agent was engaged in perpetrating.

Atlantic, etc., Bank v. Harris, 118 Mass. 147; Loring v. Brodie, 134 Mass. 453; Innerarity v. Merchants, etc., Bank, 139 Mass. 332, 52 Am. Rep. 710; Dilloway v. Butler, 135 Mass. 479; Atlantic Cotton Mills v. Indian Orchards Mills, 147 Mass. 268; Allen v. South Boston R. R. Co., 150 Mass. 206, 15 Am. St. Rep. 185; 31 Cyc. 1595; Scott County Milling Company v. Powers, 112 Miss. 798, 73 So. 792; Cooper v. Robertson Investment Co., 117 Miss. 108, 77 So. 953; Sims v. Kline, 139 Miss. 246, 104 So. 85.

A corporation is trustee for its creditors. Where a transfer of its property is made without valid consideration, the creditors may pursue the property, and force the assignee thereby to account for it.

Wright v. Petrie, S. & M. Ch. 282.

Where a contract is secured by an agent and forwarded to his principal for his approval with a provision therein that the written contract embodied the entire contract, the principal cannot be bound by any representation made by the agent in securing the contract.

J. B. Colt Company v. Odom, 136 Miss. 651, 101 So. 853.

Jno. A. Sykes, of Gulfport, for appellee.

This case is governed by Section 5873, Hemingway's 1927 Code; now appearing as Section 5196, Code 1930, as construed by this court in the following cases.

Rivara v. Ins. Co., 62 Miss. 723; Ins. Co. v. Farnsworth, 72 Miss. 555, 17 So. 445; Mitchell v. Ins. Co., 72 Miss. 53, 18 So. 86; Ins. Co. v. Stevens, 93 Miss. 439, 46 So. 247; Ins. Co. v. Stewart, 30 So. 755; Assur. Co. v. Phelps, 77 Miss. 625, 27 So. 744; Ins. Co. v. Bouldin, 100 Miss. 660, 56 So. 613; Drug Co. v. Ins. Co., 115 Miss. 333, 75 So. 768; Ins. Co. v. Smith, 117 Miss. 327, 78 So. 289; Stewart v. Coleman, 120 Miss. 28, 81 So. 655; Ins. Co. v. Vaughn, 125 Miss. 383, 88 So. 11; Ins. Co. v. Clark, 122 So. 553; Ins. Co. v. Kemp, 124 So. 63.

Section 5873, Hemingway's 1927 Code, Section 5196, Code of 1930, is to the effect that every person who (a) solicits insurance, (b) takes or transmits applications, (c) or receives or delivers policies of insurance; or (e) does or performs any other act or thing in the making or consummation of the contract shall be held to be the agent of the company.

Conditions in the policy may be waived by the agent.

Insurance Company v. Vaughn, 88 So. 12; Rivara v. Ins. Co., 62 Miss. 723; Ins. Co. v. Farnsworth, 72 Miss. 555, 17 So. 445.

Knowledge of the agent is knowledge of the principal.

Insurance Company v. Clark, 122 So. 553; Mitchell v. Ins. Co., 72 Miss. 53, 18 So. 86; Ins. Co. v. Stevens, 93 Miss. 439, 46 So. 247; Ins. Co. v. Stewart, 30 So. 755; Assur. Co. v. Phelps, 77 Miss. 625, 27 So. 744; Drug Co. v. Ins. Co., 115 Miss. 333, 75 So. 768; Ins. Co. v. Smith, 117 Miss. 327, 78 So. 289; Ins. Co. v. Kemp, 124 So. 63.

An agent delivering the policy is the agent of the company for that purpose. Under our statute, the contract becomes a Mississippi contract, and the provisions and rules, or instructions to the agent in conflict with the statute will not be allowed to prevail.

The act of the agent in delivering the policy in violation of the provisions in the application and in the policy is the act of the principal. Under our statute, the soliciting agent stands in the shoes of the principal.

Stewart v. Coleman, 120 Miss. 21, 81 So. 653; Ins. Co. v. Bouldin, 100 Miss. 660, 56 So. 63.

Where however, it appears that the parties intended to substitute the agent as the insurer's debtor...