Estes v. Lawton-Byrne-Bruner Ins. Agency Co.

Decision Date03 February 1969
Docket NumberLAWTON-BYRNE-BRUNER,32792,Nos. 32719,s. 32719
Citation437 S.W.2d 685
PartiesWellborn ESTES, Plaintiff-Appellant, v.INSURANCE AGENCY COMPANY, a Corporation, Defendant-Respondent.
CourtMissouri Court of Appeals

Coleman, Ross & Cekovsky, Sidney B. McClanahan, Clayton, for plaintiff-appellant.

Evans & Dixon, Ralph C. Kleinschmidt, St. Louis, for defendant-respondent.

BRUCE NORMILE, Special Judge.

This is an action for libel. At the trial the jury returned a verdict in favor of plaintiff in the amount of Two Thousand Dollars ($2,000.00) punitive damages. No actual damages were awarded.

The defendant's timely motion for judgment in accordance with its motion for a directed verdict was thereafter sustained by the trial court on the ground that a qualified privilege existed for the alleged defamation and that there was no evidence to support a submission to the jury requiring a finding of actual malice to overcome the privilege.

From this order of the trial court, the plaintiff has appealed. Plaintiff (appellant) states that the general question for decision on this appeal is whether the trial court was warranted in ruling that the qualified privilege was applicable to the occasion in question.

The parties agree that the facts in the case are, as stated by the trial court, 'for all intent and purposes, undisputed by the parties.' Evidence on the part of the plaintiff was elicited from plaintiff, himself, and from a Mr. Ben Fishman, one of the persons who received the communication alleged to be defamatory. Plaintiff, Wellborn Estes, testified that he was an insurance agent and broker, with offices in Clayton, Missouri. He had sold some fire insurance on a property located at 3723 Olive Street, originally owned by a man named Myer who sold the property to a Mr. and Mrs. Spaser, who then sold it to Mr. Ben Fishman. Each time the property was sold, plaintiff sold the new buyer fire insurance on the property. Mr. Fishman actually owned the property with his wife and another couple, Mr. and Mrs. Jacobs. At the time the insurance was sold, plaintiff placed this insurance with the Laclede Agency, which later merged with defendant, respondent herein, Lawton-Byrne-Bruner Insurance Agency Company. The defendant then placed the insurance with a fire insurance company. Both plaintiff and defendant received commissions on the sale of this insurance. Mr. Fishman had purchased the property in May of 1962. And this was when plaintiff first became acquainted with him by reason of selling the insurance on this property. Plaintiff had not been able to place the insurance on this property with any of the companies for which he was an agent for the reason that it was an undesirable property. It was for this reason that he placed the insurance on the property through the defendant's agency. In March, 1963, the insuring companies notified the defendant Lawton-Byrne-Bruner Insurance Agency Company, that they no longer cared to remain on the risk, and directed the defendant agency to cancel the policies within thirty (30) days. Defendant then notified plaintiff to inform the insured that the policies were to be cancelled and to pick up the same. The defendant could have notified the policyholder directly of the cancellation, but notice was given to plaintiff as a courtesy to the agent.

Plaintiff further testified that upon receiving this notice he wrote to Mr. Ben Fishman, one of the owners of the premises, advising him that the policies were to be cancelled. This letter to Mr. Fishman was sent to the address of the insured property at 3723 Olive Street which was neither Mr. Fishman's place of business nor his residence. Plaintiff conceded that his secretary might have made an innocent mistake in sending the letter to this address. Mr. Fishman later told plaintiff that he had not received this notice. About a month later, plaintiff was contacted by telephone by the defendant about picking up the policies. At that time, plaintiff asked the defendant, Lawton-Byrne-Bruner, to send a formal notice of cancellation direct to Mr. Fishman and the other insureds.

Plaintiff thereafter received a telephone call from Ben Fishman who asked what was going on, that he had received a formal notice of cancellation for non-payment of premium on his policies. Plaintiff went right down to see Mr. Fishman and explained to him that the premiums had been paid.

The cancellation notice received by Fishman was entered into evidence as Plaintiff's Exhibit Number I and was in the following form:



Insurance Agency Co.

401 Pine Street

St. Louis 2, Mo.

St. Louis, Mo., APRIL 16, 1963



You are hereby notified that payment has not been made at this office of the premium of $160.65 for Policy No. 7233310 dated MAY 22 1962 for $5.000.00 upon your BUILDING at 3723 OLIVE STREET issued for you through this office in the NATIONAL FIRE Ins. Co. and that unless same is paid on or before 12 o'clock Noon of the fifth day after receipt of this notice, we shall cancel the insurance under said policy upon our books for non-payment of premium, terminating our liability thereunder from that date, in accordance with the printed conditions of this policy.

Yours respectfully,



After visiting Fishman and seeing the above notice, plaintiff immediately went back to his office, called Lawton-Byrne-Bruner, and talked to a Miss Rutherford. Miss Rutherford treated the plaintiff properly and was courteous and polite to him. Plaintiff asked why the notices of cancellation for non-payment of premium had been sent, stated that they had in fact been paid, and requested that the agency send a letter to Mr. Fishman, and the others, to that effect. Miss Rutherford indicated that she could not write a letter to Mr. Fishman and plaintiff asked to speak to Mr. Farrington, the president of Lawton-Byrne-Bruner. Plaintiff explained the situation to Mr. Farrington and said, 'I want you to write a letter, this is a clerical error, won't you write a letter to my insured and explain the policy premiums were paid * * *.' Mr. Farrington also declined to write a letter but told plaintiff that he would make a telephone call to Mr. Fishman, or anyone else plaintiff wanted, to explain the situation.

About two days later, plaintiff called Mr. Farrington again and asked for a letter. At trial, plaintiff testified as to the second visit with Mr. Farrington and stated that: 'I explained it was purely a clerical error * * *.' During the conversations with Mr. Farrington, plaintiff did not notice that Mr. Farrington spoke in anger or that there was any evidence of ill will toward plaintiff. The phone conversations with Mr. Farrington were on the 16th and 18th of April, 1963. A day or two later plaintiff and his attorney went to see Mr. Farrington. Thereafter on May 13th this action was filed. Subsequently, Lawton-Byrne-Bruner sent a letter to plaintiff stating that a mistake had been made and the notice of cancellation had come out on the wrong form, on the basis of non-payment of premium when it should have been under the terms of the policy. A similar letter was later sent to the policyholders.

Plaintiff's only other witness was one of the insureds, Mr. Ben Fishman, who owned the property at 3723 Olive Street together with his wife and Mr. and Mrs. Oscar Jacobs. Mr. Fishman testified that he purchased this property in 1962 and that these policies already existed on the property. The witness then renewed the policies with plaintiff. Mr. Fishman had not known the plaintiff prior to that time. Upon renewal, the premium was paid to Mr. Estes. In April, 1963, Mr. Fishman and the other owners received notices by certified mail that the policies were cancelled for nonpayment. The notices were signed by defendant Lawton-Byrne-Bruner Insurance Agency Company. Mr. Fishman thereupon contacted plaintiff who came to see him that day or the next day. Plaintiff told Mr. fishman that the premium was paid and not to worry about it. A month or so later Mr. Fishman received a letter from Lawton-Byrne-Bruner indicating that the policies were paid.

Prior to receiving notice from Lawton-Byrne-Bruner, Mr. Fishman had not been notified by plaintiff that the policies were to be cancelled. Plaintiff did not indicate to Mr. Fishman that he was going to replace the policies in any other company. Mr. Fishman testified that he had other properties and always insured them with 'whoever gives me the cheaper price.' Mr. Fishman had no special relationship with Mr. Estes but would buy from him if he had a cheaper policy. Upon this evidence, plaintiff rested his case. Defendant's motion for a directed verdict at the close of plaintiff's case was then filed and overruled.

Evidence on the part of the defendant was elicited from only two witnesses. Judy Astrankas testified that she was employed by Lawton-Byrne-Bruner in 1963 and at the time of trial. She worked in the Outside Broker's Department placing business for them. The witness testified that in March of 1963 a request was received through the underwriters in connection with cancellation of some policies that the outside broker, plaintiff, Wellborn Estes, had written on the Olive Street property. Mrs Astrankas had written a letter to Mr. Estes about March 18th advising that the companies were calling in the policies and requesting Mr. Estes to pick them up. About a month later, the witness followed the matter up by a telephone call to Mr. Estes. The plaintiff requested her to go ahead and send a direct notice through Lawton-Byrne-Bruner. Mrs. Astrankas then advised the underwriter and the matter went out of her hands. The witness was not personally acquainted with plaintiff.

Defendant's other witness, Virginia Downer, testified that she was also an employee of Lawton-Byrne-Bruner in 1963 and at time...

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