Pugh v. Great Plains Ins. Co., Inc.

• Decision Date: 27 September 1991
• Docket Number: No. 89-425,89-425
• Parties: Al PUGH, Appellee and Cross-Appellant, v. GREAT PLAINS INSURANCE CO., INC., a Nebraska Insurance Corporation, Appellant and Cross-Appellee.
• Court: Nebraska Supreme Court

Page 677

474 N.W.2d 677

239 Neb. 171

Al PUGH, Appellee and Cross-Appellant, v. GREAT PLAINS INSURANCE CO., INC., a Nebraska Insurance Corporation, Appellant and Cross-Appellee.

No. 89-425.

Supreme Court of Nebraska.

Sept. 27, 1991.

Syllabus by the Court

1. Judgments: Verdicts. On a motion for judgment notwithstanding the verdict, the movant is deemed to have admitted as true all the relevant evidence admitted which is favorable to the party against whom the motion is directed, and, further, the party against whom the motion is directed is entitled to the benefit of all proper inferences deducible from the relevant evidence.

2. Motions to Dismiss. A party against whom a motion to dismiss is directed is entitled to have all relevant evidence accepted or treated as true, every controverted fact as favorably resolved, and every beneficial inference reasonably deducible from the evidence.

3. Directed Verdict. A court cannot decide an issue as a matter of law unless the facts adduced on an issue are such that reasonable minds can draw but one conclusion from the evidence. In a jury trial, when evidence compels but one reasonable conclusion regarding an issue or question in the litigation, a court can properly direct a verdict on such issue or question.

4. Jury Instructions: Proof: Appeal and Error. In an appeal based on the claim of an erroneous instruction, the appellant has the burden to show that the questioned instruction was prejudicial or otherwise adversely affected a substantial right of the appellant.

5. Prejudgment Interest: Claims. Prejudgment interest is allowed where the amount of the claim is liquidated. When a reasonable controversy exists concerning the claimant's right to recover or the amount of such recovery, the claim is unliquidated, and prejudgment interest is not allowed.

6. Prejudgment Interest: Claims. The amount of a claim is liquidated when the evidence furnishes a basis to compute an exact amount determinable without opinion or discretion inherent in the factfinding process.

William E. Pfeiffer, Omaha, for appellant.

Jeanne A. Weaver, of Zweiback, Hotz & Lamberty, P.C., Omaha, for appellee.

Before HASTINGS, C.J., and BOSLAUGH, WHITE, CAPORALE, SHANAHAN, GRANT, and FAHRNBRUCH, JJ.

SHANAHAN, Justice.

Al Pugh commenced an action against Great Plains Insurance Co., Inc., to collect commissions claimed under two agency agreements. Great Plains appeals from judgments entered on the verdicts for Pugh.

STANDARD OF REVIEW

(DIRECTED VERDICT; JUDGMENT N.O.V.)

Among its assignments of error, Great Plains contends that the district court should have directed a verdict on Pugh's second cause of action and should have entered judgment for Great Plains notwithstanding the verdict (judgment n.o.v.) for Pugh on his second cause of action.

On a motion for judgment n.o.v., the movant is deemed to have admitted as true all the relevant evidence admitted which is favorable to the party against whom the motion is directed, and, further, the party against whom the motion is directed is entitled to the benefit of all proper inferences deducible from the relevant evidence.

Dunn v. Hemberger, 230 Neb. 171, 180, 430 N.W.2d 516, 522 (1988). Accord, Kelly Klosure v. Johnson Grant & Co., 229 Neb. 369, 427 N.W.2d 44 (1988); Havlicek v. Desai, 225 Neb. 222, 403 N.W.2d 386 (1987).

"A party against whom a motion to dismiss is directed is entitled to have all relevant evidence accepted or treated as true, every controverted fact as favorably resolved, and every beneficial inference reasonably deducible from the evidence." Burns v. Veterans of Foreign Wars, 231 Neb. 844, 850, 438 N.W.2d 485, 489 (1989). Accord, Dale v. Thomas Funeral Home, 237 Neb. 528, 466 N.W.2d 805 (1991); Anderson v. Union Pacific RR. Co., 229 Neb. 321, 426 N.W.2d 518 (1988); Rahmig v. Mosley Machinery Co., 226 Neb. 423, 412 N.W.2d 56 (1987).

A court cannot decide an issue as a matter of law unless the facts adduced on an issue are such that reasonable minds can draw but one conclusion from the evidence. [Citation omitted.] In a jury trial, when evidence compels but one reasonable conclusion regarding an issue or question in the litigation, a court can properly direct a verdict on such issue or question.

Anderson v. Union Pacific RR. Co., supra, 229 Neb. at 323, 426 N.W.2d at 519. Accord, Dale v. Thomas Funeral Home, supra; Burns v. Veterans of Foreign Wars, supra; Rahmig v. Mosley Machinery Co., supra.

FIRST CAUSE OF ACTION

Pugh was employed by Great Plains and was responsible for sales and service of credit life insurance, credit disability insurance, and various lender security or collateral In November or December 1983, Norman Rips, the chairman of the board and chief executive officer of Great Plains, and Jeffrey Silver, secretary and general counsel of Great Plains, told Pugh that he would receive a 10-percent commission on premiums paid by First National and U.S. National in connection with lenders' security programs. Rips had authority to enter such an agreement on behalf of Great Plains and acknowledged that Great Plains "had certain kinds of specialty coverages [lender security coverage] which [Pugh] attempted to write on our [Great Plains'] behalf. And if he did so, [Great Plains] would pay him a commission.... [H]e was supposed to get around 10 percent commission...."

protection programs, designated "lenders' security programs," offered by banks. These programs, conducted by Empire Life Insurance Company, a Great Plains affiliate, provided insurance coverage for U.S. National Bank (Norwest) and First National Bank on loans from the banks. In view of the extensive paperwork associated with the insurance programs, Great Plains hired Management Insurance Consultants to provide computer services and assistance in lenders' security programs. Pugh was Empire's liaison between the banks and Management Insurance Consultants. In 1983, Great Plains transferred the credit life and credit disability insurance to Eagle Life Insurance Company, another Great Plains affiliate, and assigned Pugh to Eagle.

Pugh and Great Plains stipulated that the amount of premiums paid by the banks was $141,340.61 on March 31, 1985; hence, Pugh claimed a commission based on 10 percent of $141,340.61, or $14,134.06.

SECOND CAUSE OF ACTION

Pugh agreed to assist Great Plains in development and service of a warranty insurance program for The ALCO Company, a Colorado corporation which manufactured and sold replacement doors and windows. The extended warranty coverage was in addition to ALCO's factory warranty on its products. ALCO sold the extended warranties for periods of 5 years, 10 years, or the life of an ALCO product. When a customer purchased the extended coverage, ALCO sent the "premium" to Great Plains, which retained 17.5 percent of the premium and sent the remaining 82.5 percent to an insurance company which maintained a claim fund for the ALCO warranties. Of the 17.5 percent retained by Great Plains, Pugh was supposed to receive 28.57 percent, representing 5 percent of the total premium paid by ALCO, while Great Plains would retain 71.43 percent, or 12.5 percent of the total premium paid by ALCO.

Between the fall of 1984 and May 1985, ALCO sold extended warranties, but failed to remit premiums collected for the coverage. In May 1985, Pugh met with ALCO regarding the unremitted premiums due Great Plains and obtained ALCO's check for $193,213, the amount of the unremitted premiums. However, when ALCO later notified Pugh that the check would not clear, ALCO's check was not deposited. Silver, on behalf of Great Plains, wrote several demand letters to ALCO and stated that Great Plains had "yet to receive its first dollar of premium" for the warranty coverage and emphasized "ALCO's retention of insurance premiums due and owing to Great Plains" concerning the coverage. Silver informed ALCO that, based on the "total written premiums," Great Plains claimed a "cancellation fee" of $102,750. Subsequently, Great Plains and ALCO settled their dispute by a settlement of $70,000 reflected in a cash payment of $40,000 to Great Plains and ALCO's promissory note to Great Plains for $30,000. Pugh discovered the negotiated settlement and ALCO's eventual payment of $60,000 in accordance with the settlement. For that reason, Pugh requested that he be paid his commission pursuant to the agency agreement, that is, 28.57 percent of the $60,000 settlement payment, or $17,142. Great Plains paid Pugh $2,500, leaving a balance of $14,642 on Pugh's claimed commission, but refused further payment to Pugh because, as Great Plains asserted, any payment from ALCO was a "cancellation fee" and, therefore, not subject to the Pugh

Great Plains agency agreement for Pugh's commission.

INSTRUCTION NO. 4

Over Great Plains' objection, the court instructed:

Before the plaintiff can recover against defendant on his first cause of action, the burden is upon the plaintiff to prove by a preponderance of the evidence each and all of the following propositions:

1. That the parties entered into a valid agreement;

2. That the agreement remained in effect from January 1, 1984 through the time the net premiums for the Lenders Security Insurance policies issued to Norwest and First National Bank were received;

3. That the plaintiff complied with the terms of the agreement;

4. That the defendant breached the agreement by failing to pay the amount due under the agreement.

If the plaintiff has failed to establish any one or more of the foregoing numbered propositions by a preponderance of the evidence, your verdict on the first cause of action will be for the defendant.

On the other hand, if the plaintiff has established, by a preponderance of the...