Shedden v. Heard

• Decision Date: 07 April 1900
• Parties: SHEDDEN v. HEARD.
• Court: Georgia Supreme Court

35 S.E. 707

110 Ga. 461

SHEDDEN v. HEARD.

Supreme Court of Georgia

April 7, 1900

Syllabus by the Court.

1. If a general agent of a life insurance company, who appoints agents to work for the company under his supervision, and whose duty it is to report to him, discounts a promissory note taken by them form an applicant for insurance for a premium upon a policy to be issued and delivered to the applicant, such general agent cannot, when he brings an action upon the note, set up that he was a bona fide purchaser thereof for value before maturity, and thus cut off a defense that the plaintiff acquired the note before the delivery of the policy, and that the consideration of the note failed, because the policy delivered was not of the kind for which the application was made.

2. If however, the applicant was able to read the application presented for his signature, and with full opportunity so to do negligently failed to read it, and signed without so doing, and if the policy actually issued and delivered to him was one exactly of the kind described in the application, he could not set up in defense to such an action that the agent at whose instance he signed the application, by fraudulently representing its contents, induced him to sign an application which he really did not intend to make. In such a case the general agent would be authorized to act upon the assumption that the application was freely and voluntarily executed.

3. When a duly-approved copy of a writing alleged to be inaccessible was actually admitted in evidence, it is immaterial whether error was or was not committed in admitting testimony offered to establish the fact of inaccessibility.

4. Where such a copy is in evidence, parol testimony as to its contents is inadmissible.

5. The direction of the verdict for the defendant was erroneous.

Error from superior court, Wilkes county; Seaborn Reese, Judge.

Action by R. F. Shedden against M. L. Heard, Jr. Judgment for defendant, and plaintiff brings error. Reversed.

Saml. H. Sibley, for plaintiff in error.

Colley & Sims, for defendant in error.

LEWIS J.

R. F Shedden brought suit in the county court of Wilkes against M L. Heard, Jr., on a promissory note for $105.50 dated July 5, 1899, payable "to the order of myself," and signed by the defendant. This note was indorsed by the defendant, and by G. W. Byington and G. T. Hodgson. The answer of the defendant admitted giving the note, that it was past due, and that he failed and refused to pay the same or any part thereof. He denied the other allegations in the petition, namely, that plaintiff was a bona fide indorsee for value of the note, and that defendant was indebted to plaintiff in the sum sued for. In his plea he further alleged that the note was given by him to Byington & Hodgson, the indorsers thereon, who were the agents of the New York Mutual Life Insurance Company, soliciting business for said company; that the plaintiff in this suit was, at the time of the giving and indorsement of the note, the general manager of all the business and agents of said company in this state; that defendant gave the note in settlement of the first premium on a policy of life insurance in said company for $5,000, the agents agreeing to deliver him a policy for said sum which by its terms, upon the payment of $105.50 annually, was to be fully paid up at the end of 20 years, with the privilege of defendant to withdraw said sum at said term, and an accumulated interest in the dividends amounting to $1,000 more; that when the policy was received by defendant it was not the kind contracted for, and defendant at once returned it, with the statement that the same "was not of the kind applied for"; that the policy sent defendant required payments for life of defendant, and no money to be paid until death. He therefore pleaded a failure of consideration for the note, and charged that plaintiff had notice that this note was for a premium for said policy, and he knew that defendant had a reasonable time in which to inspect the policy, and for him to buy the note before this time had expired showed fraud and bad faith, and defendant asked that plaintiff be called upon to prove that he was a bona fide purchaser for value of the note. A general demurrer was filed to this answer by plaintiff's counsel, which was overruled by the court, on which error is assigned in the bill of exceptions.

It appears from the evidence that the plaintiff was a general agent for the company for the state of Georgia, and that Byington & Hodgson were engaged in soliciting life insurance for the company, and they were employés of the company by appointment of plaintiff. The defendant admitted signing a written application for the policy, and delivering the same with the note sued on, to Byington & Hodgson. He says he did not read the application, but relied on the representations made by these two agents as to its contents; that one of them read, or pretended to read, this application to him, and, the way he read it, it called for the kind of policy which his answer sets forth he had contracted for. After receiving the policy, he again saw these agents, who admitted to him that it was not the policy he asked for, but a better and cheaper one, and several witnesses were introduced by him whose testimony tended to prove such admissions on the part of these two agents. On the other hand, testimony was introduced by the plaintiff denying any such misrepresentation, and tending to show that the nature of the application he signed and of the policy he received was thoroughly and correctly explained to the defendant. It appears from the testimony that the company did not issue policies until the first premium was paid in cash. These policies were issued from the office in New York. This note, it seems, was taken for the purpose of negotiating the same, and raising the cash thereon, to send with the application in payment of the premium on the policy. The note was carried by these subagents to the plaintiff, who discounted the same in bank, and sent the money with the application to the company in New York. The policy was returned to the general agent, who sent the same to the applicant. It was returned by him with the claim that it was not the policy he applied for. It was again sent to defendant by the agent, but at the trial it seems was in the possession of defendant, after an interchange between him and the agent had been made two or three times. Testimony was introduced in behalf of plai...