Wells v. Payne

• Decision Date: 13 January 1911
• Citation: 141 Ky. 578,133 S.W. 575
• Parties: WELLS et al. v. PAYNE.
• Court: Kentucky Court of Appeals

133 S.W. 575

141 Ky. 578

WELLS et al. v. PAYNE.

Court of Appeals of Kentucky.

January 13, 1911

Appeal from Circuit Court, Taylor County.

Action by W. C. Payne against A. N. Wells and others. Judgment for the plaintiff, and the defendants appeal. Reversed and remanded.

J. W Rawlings, for appellants.

O'REAR J.

Appellant A. N. Wells is the general manager of the Farmers' Home Insurance Company, a co-operative assessment fire insurance company organized under sections 702-722, Ky. St (Russell's St. §§ 4310-4329). The business of the company is limited to 10 counties by its charter and by the statute and is confined to insuring its members against loss or damage by fire during the terms of their respective policies. Losses are payable by assessments made upon all holders of policies of the same class ratably. Until paid, the assessment is a "lien upon the property insured to secure the payment of such assessments, and calls as may be legally made under the contract of insurance." Section 712, Ky. St. As to indebtedness of such corporation, it is provided, by section 710, Ky. St. as follows: "The officers of such corporation shall not enter into any contract or agreement, or make any debt of any kind, except for payment of losses or damages as aforesaid, that will require any assessment of more than fifty cents on one hundred dollars of insurance in force. Neither shall the officers of any such company use for current expenses any money assessed for losses or damages, and all money for such expenses raised by assessment must be so stated in the notice calling for same."

Appellee W. C. Payne, was an insurance solicitor representing the Continental Insurance Company of New York. Among the counties in which the Farmers' Home Insurance Company was authorized to do business is Taylor county. W. C. Payne resided in Taylor county, and was doing business there as an insurance agent or solicitor of insurance. The competition for the business of the same class by Payne and agents of the Farmers' Home Insurance Company caused a rivalry between them. The Farmers' Home policy holders began to drop their insurance until it is said as much as $50,000 of it in Taylor county was lapsed or canceled. Complaints were made to Wells by policy holders of the Farmers' Home as to representations concerning the standing of that company, in which it was claimed Payne had represented that the Farmers' Home was a "wildcat" company, and insolvent. Wells personally investigated the matter. He found upon inquiry that Payne had made those and similar representations concerning the reliability of the Farmers' Home Insurance Company to a great many people in Taylor county. Thereupon Wells sent Payne a notice, which he caused to be served by the delivery of a copy by the coroner of Taylor county, in which it was, in substance, charged that Payne was "meddling with the affairs of the Farmers' Home Insurance Company by misrepresentation, prevarication, and thereby fraudulently taking up policies and replacing them with policies of the Continental of New York," and with discouraging holders where he could not succeed in procuring them to cancel their policies; and by "every possible word, act, and deed endeavoring to belittle the company," thereby reaping profits for himself and "thereby defrauding the Farmers' Home Insurance Company of its business that it had bought and paid for." The remainder of the notice was an implication of the charge, mostly by repetition. The notice was signed "Farmers' Home Insurance Company, by A. N. Wells, General Manager." Payne brought this suit for damages because of the alleged libel contained in the writing. He charges that its accusations are false, and were made maliciously by Wells on behalf of the Farmers' Home Insurance Company. The trial resulted in a verdict of $250 in favor of the plaintiff against the defendants. Defendant Wells pleaded the truth of the charges in justification. The company denied Wells' authority to have spoken for it in such behalf;...