Theno v. National Assur. Corp.

• Decision Date: 10 December 1937
• Docket Number: 30107.
• Citation: 276 N.W. 375,133 Neb. 618
• Parties: THENO v. NATIONAL ASSUR. CORPORATION.
• Court: Nebraska Supreme Court

276 N.W. 375

133 Neb. 618

THENO v. NATIONAL ASSUR. CORPORATION.

No. 30107.

Supreme Court of Nebraska.

December 10, 1937

Syllabus by the Court.

1. If a written agreement was executed for the purpose of settling all pending business matters between the parties, and in which each released and discharged the other of any and all claims, it is held that an alleged prior oral agreement providing for additional renewal commissions on premiums to be paid in after plaintiff has quit such employment, cannot be shown, as it would add to, contradict, and modify the express terms of the final settlement agreement.

2. The admission without objection of testimony in violation of the parol evidence rule does not preclude the court from disregarding such testimony and sustaining a motion to direct a verdict.

3. The parol evidence rule is not merely one of evidence, but is a rule of substantive law, which declares that certain kinds of facts are legally ineffective, and forbids such facts to be proved at all.

Appeal from District Court, Lancaster County; Broady, Judge.

Action by Elmer E. Theno against the National Assurance Corporation. Judgment for defendant, and plaintiff appeals.

Affirmed.

DAY J., dissenting.

Frederick J. Patz, of Lincoln, and Edward C. Fisher, of Omaha, for appellant.

Flansburg, Lee & Sheldahl, of Lincoln, for appellee.

Heard before GOSS, C. J., and ROSE, DAY, PAINE, CARTER, and MESSMORE, JJ., and TEWELL, District Judge.

PAINE Justice.

An action at law was brought by an agent to recover commissions he claimed due from defendant company for selling policies under two separate oral contracts of agency. The claim for commissions to be collected after plaintiff left the employ of the company is flatly denied by defendant, which sets up in its answer a written settlement agreement, which definitely settles all past or future claims between the parties. At the close of all the evidence a verdict was directed for defendant.

Plaintiff sought to introduce evidence of mistake, accident, and fraud in such written settlement, and claimed that it was not intended by either party to cover renewal commissions. The court sustained objections and refused to admit some of such evidence.

The defendant's motion for a directed verdict charged that the written settlement agreement was complete on its face and covered all claims of plaintiff, and for the further reason that plaintiff's allegations of fraud with reference to the settlement agreement were not supported by any evidence, and that plaintiff had received $500 for the purchase of his stock, according to the terms of such settlement, and had received about the same amount in payments upon other items in such settlement contract, and that, as he had retained all of such payments received under the settlement agreement, he had thereby ratified it.

The errors relied upon for reversal allege fraud, accident, mistake, and concealment in the making of the final settlement contract between the parties, and that the court erred in refusing to allow testimony to vary the terms of the instrument.

It appears from the bill of exceptions that exhibit No. 9 is the final settlement agreement, made December 9, 1935, between the plaintiff and defendant. Such agreement provides, first, for the purchase of 20 shares of stock held by the plaintiff in the defendant company, for which the defendant agrees to pay the sum of $500. The third paragraph provides that the defendant is to pay to the plaintiff commissions of 66 2/3 per cent. on over 40 policies listed in exhibit A, attached thereto, when such premiums are paid. The fourth paragraph provides that, if the plaintiff reinstates any of the lapsed policies therein listed, he will be paid 66 2/3 per cent. of the first year's premiums. The fifth and final paragraph provides as follows: " In consideration of the foregoing, the first and second parties mutually agree that the second party accepts the resignation of the first party, and that the first and second parties hereby release and discharge any and all claims that they now have or may have against each other, except the commissions that may become due the first party under paragraphs three and four of this agreement, which commissions shall be paid by the second party when and as they become due thereunder."

The evidence disclosed that the plaintiff had worked for the defendant some five years, beginning in October, 1928, at the end of which time he claimed they owed him certain renewal commissions. He reentered their employment under a second oral contract to take charge of a department for the sale of thrift contracts, but after discussion it was decided to get away from the word " thrift" and call them endowment savings contracts, and after a discussion of the matter from December, 1933, to March, 1934, the plaintiff again actively entered the employment of the defendant.

The plaintiff claims that in March, 1934, W. L. Harlan promised him if he would come back to work they would put him in full and complete charge of the endowment savings department, and would give him $8 out of the first $12 paid by the purchaser and a 5 per cent. renewal for a nine-year period thereafter, which renewals would be vested and nonforfeitable, and if agents under him sold these thrift units plaintiff was to receive $1 on the first year's payments as an overwriting commission, and he was to receive, according to his testimony, 5 per cent. renewal on all such endowment savings contracts after the first year, no matter who sold them.

During 1935 many disputes arose, and finally the plaintiff decided to leave the company, and the final settlement contract of December 9, 1935, was drawn. L. L. Waters, secretary-treasurer of defendant, testified as to a conver sation in which the plaintiff said: " Now that I have definitely made up my mind I am going to leave I want to have a positive understanding of just exactly what my status is and the company's status is after I leave." And, further: " He suggested that it be reduced to writing so that we would both of us understand and we would agree exactly the basis on which he terminated his employment. I asked him what he wanted included in that agreement and he said, ‘ I want you to buy the stock I own in the company. I want you to buy that and pay me $500 for it.' "

The plaintiff would not sign this agreement until he had taken it out to Mr. Harlan's home, where he was sick, and talked it over with his friend Mr. Harlan, and he came back and said that, if they would insert in the settlement contract that the company would release him from any claims of any kind which the company might have against him, as he was releasing it, he would sign it. After this provision demanded by the plaintiff was inserted, the contract was drawn and signed by the parties as an entire settlement of all the transactions of every kind and nature between the parties.

In rebuttal the plaintiff sought to...