Law v. Waldron

• Decision Date: 27 February 1911
• Docket Number: 95
• Citation: 79 A. 647,230 Pa. 458
• Parties: Law v. Waldron, Appellant
• Court: Pennsylvania Supreme Court

79 A. 647

230 Pa. 458

Law v. Waldron, Appellant

No. 95

Supreme Court of Pennsylvania

February 27, 1911

Argued January 3, 1911

Appeal, No. 95, Jan. T., 1910, bye defendant, from order of C.P. No. 1, Phila. Co., Dec. Term, 1909, No. 2,653, making absolute rule for judgment for want of a sufficient affidavit of defense in case of John H. Law and George W. Law copartners, trading as Law Brothers, Trustees for the Royal Insurance Company, Ltd., of Liverpool, England, v. Alfred M Waldron. Affirmed.

Assumpsit to recover balance alleged to be due by an agent.

The material averments of the statement of claim and the affidavit of defense are set forth in the opinion of the Supreme Court.

The court by BREGY, P.J., filed the following opinion:

This is a rule for judgment for so much of the amount claimed in the plaintiffs' statement as to which the affidavit of defense is insufficient, but as the rule itself does not set out the items it becomes the duty of the court, if it thinks the rule should be made absolute under Pierson v. Krause, 208 Pa. 115, to set them out.

The defendant was the local agent in Philadelphia and the surrounding counties of the German National Insurance Company and the German Insurance Company of Freeport. These companies went into the hands of receivers on November 19, and 20, 1906, and thereafter defendant rendered accounts showing that $7,137.19 was due the companies, but making certain claims in the nature of offsets, these not being allowed, and the rights of the insurance companies having been assigned to the plaintiffs this suit was brought to recover $6,178.97, being the above amount less certain allowances with interest from November 20, 1906. The defendant filed an affidavit of defense in which he charged himself with $7,137.19, and claimed the offsets set out in his accounts and certain others, whereupon the plaintiffs took this rule. The court is of opinion that the amount admitted to be due by the defendant, namely, $7,137.19, should have deducted from it the following items, for which credits were asked in the account rendered the German National Insurance Company, viz.: November balance, $11.61, contingent 1906, as per schedule B, $358.15, and also the following items for which credits were asked in the account rendered the German Insurance Company of Freeport, viz.: November balance, $415.55, contingent 1896, as per schedule B, $752.11; $50,615 net reinsurance. Amount, as per bill, $2.52 -- $1,539.94. Leaving due the plaintiff, $5,597.25. That the remaining items claimed as credits by the defendant cannot be allowed under the contract.

According to the plaintiffs' statement, the total amount claimed, allowing part of the credits above mentioned, was $6,178.97, but as all of the above credits have been allowed in full, there must be deducted from that amount in addition, $581.72, leaving due as above, $5,597.25. The rule is therefore made absolute for this amount with interest from November 29, 1906, and judgment is entered for the plaintiff for $6,699.90.

Errors assigned were as follows: (1) The learned court erred in entering judgment for the plaintiffs for the sum of $6,699.90; (2) the learned court erred in not discharging plaintiffs' rule for judgment for the amount as to which the affidavit of defense was insufficient.

The assignments of error are overruled and the judgment is affirmed.

Frank R. Shattuck, with him John Reynolds, for appellant. -- Under the Act of July 15, 1897, P.L. 276, the lower court cannot enter a valid judgment on a rule for the amount as to which the affidavit of defense is deemed insufficient, without giving reasons therefor: Pierson v. Krause, 208 Pa. 115; New York Trust Co. v. Langcliffe Coal Co., 227 Pa. 630.

The defendant is entitled to claim losses by reason of the breach of the contract though the companies had gone into the hands of a receiver; and further, the entire question of dispute between the accounts was one for the jury: Spader v. Mfg. Co., 47 N.J. Eq. 18 (20 A. Repr. 378); Bolles v. Drug Co., 53 N.J. Eq. 614 (32 A. Repr. 106); Bowe v. Milk Co., 44 Minn. 460 (47 N.W. 151); Rosenbaum v. U.S. Credit System Co., 61 N.J.L. 543 (40 A. Repr. 591); Merchants' & Mfrs. Nat. Bank v. Spratt & Co., 108 Pa. 97; Griffith v. Lumber Co., 55 W.Va. 604 (48 S.E. Repr. 442).

C. Berkeley Taylor, for appellees. -- The loss of commissions by breaking the contract cannot be allowed, the break being the act of the law and not that of the parties and damnum absque injuria: People v. Globe Life Ins. Co., 91 N.Y. 174; Lorillard v. Clyde, 142 N.Y. 456 (37 N.E. Repr. 489); Mason v. Standard Distilling Co., 85 A.D. 520 (83 N.Y.S. 343); Labaree v. Crossman, 100 A.D. 499 (92 N.Y.S. 565); Stannard v. Reid Co., 114 A.D. 135 (99 N.Y.S. 567); Malcomson v. Wappoo Mills, 88 Fed. Repr. 680; Lenoir v. Linville Imp. Co., 126 N.C. 922 (36 S.E. Repr. 185); Griffith v. Blackwater Co., 46 W.Va. 56 (33 S.E. Repr. 125); In re United Mutual Fire Ins. Co., 22 R.I. 108 (46 A. Repr. 273); Dickinson v. Calahan, 19 Pa. 227; Schlater v. Winpenny, 75 Pa. 321; Louchheim v. Weighing Co., 12 Pa.Super. 55; Kern's Est., 176 Pa. 373; Blakely v. Sousa, 197 Pa. 305.

Before FELL, C.J., BROWN, MESTREZAT, POTTER, ELKIN, STEWART and MOSCHZISKER, JJ.

OPINION

MR. JUSTICE MOSCHZISKER:

The plaintiffs took a rule for judgment for "so much of the amount claimed by the statement as to which the affidavit of defense is insufficient." The rule was made absolute and a judgment entered, from which the defendant has appealed.

In January, 1904, the defendant signed a contract with the German National Insurance Company, of Illinois, to act as its general agent in Philadelphia and vicinity, and in March, 1904, he entered into a precisely similar contract with the German Insurance Company, of Illinois. These contracts provide, art. I, for the appointment of the defendant as the general agent of the respective companies in the designated territory, with power, inter alia, to appoint subagents. Article II, ". . . said first party agrees to pay said second party thirty (30) per cent commission on all net premiums written in said territory, whether by said second party or through agents appointed by said second party, and a contingent sum of money equal to ten (10) per cent of the net profits of the business written . . . in the territory . . . to be computed on a basis of income and outgo, as follows: -- income -- Gross premiums less return premiums, amounts paid for reinsurance annually. Outgo-losses paid annually, after deducting reinsured losses collected; losses outstanding unpaid, insurance department fees, State and local taxes and licenses, State and local board expenses and all regular and approved incidental expenses of agents charged by agents and said second party to the first party." Article III: ". . . said second party agrees to devote the necessary time to the interests of the said first party in the appointment and supervision of agents, inspection of risks, adjustment of losses and such general work pertaining to a general agent's occupation without further compensation. . . . The said second party . . . to assume all liability for balances of the agents and other representatives appointed in said territory by said second party, and agrees to hold said first party free from any and all loss or damage therefrom, and further agrees to remit . . . (monthly) to said first party all balances due. . . . It is agreed that this contract shall continue and remain in force so long as mutually agreeable to the contracting parties, and the same may be modified or terminated at any time at ninety days' notice by either party giving a written notice to the other of the intention to modify or terminate the same."

In November, 1906, both of the insurance companies went into the hands of a receiver appointed by the circuit court of Cook county, Illinois. The receiver by leave and under the instructions of the court sold the assets of the two companies to the Royal Insurance Company. At the request of the purchaser these assets, including the claims against the defendant, were duly assigned to the plaintiffs. In January 1910, the plaintiffs brought the present action for $6,178.97, with interest from November 20, 1906. The statement of claim averred that the defendant, as agent of the German National Insurance Company, owed monthly balances aggregating $1,583.01, against which he was entitled to a credit of "$328.87, Contingent commissions" and "$11.61 November balance," leaving $1,254.14 as the net amount due on that account; and that, as agent of the German Insurance Company, he owed monthly balances aggregating $5,554.18, less a credit of $629.35, "Contingent commissions," leaving $4,924.83 as the net balance due on that account. The defendant filed an affidavit of defense in which he admitted the balance of $1,583.01, but claimed set-offs as follows: (1) "November balance, $11.61;" (2) "Contingent 1906 as per schedule B, $358.15;" (3) "Loss of commission by Co. breaking contract as per schedule A, $378.54;" (4) "Commission on return premiums from March, 1906, to November, 1906, which was credited to the Company by error, $785.60;" (5) "Closing out agencies as per schedule C, $120.43;" (6) "Adj. expenses as per vouchers, $105.50;" (7) "Loss paid by A. M. Waldron, July 3, 1908,...