118 A.D. 194

Otto P. Heyn, Plaintiff, v. New York Life Insurance Company, Defendant.

First Department,

March 8; 1907.

Principal and agent—when insurance agent not entitled to commissions on renewal premiums after discharge.

In the absence of an agreement limiting an insurance agent’s commissions to premiums received "by the company during the continuance of his agency,, he is entitled to commissions on renewal premiums received after the termination of his agency upon-policies written during its continuance."

The parties, however, may agree to the contrary, and where a contract of agency for an indeterminate period provides, for commissions on the original-or renewal cash premiums collected. “ during his continuance as said agent,” the agent I? not entitled -to commissions after the termination of his, employment.

The above construction will be given to the contract although a subsequent clause provides, that, if in any yéar the agent secure new .insurance on the , plan stated aforesaid “ subject to all.the,terms and- Conditions ” thereof amount, ing to a certain sum, he shall be entitled1 -to commissions upon the renewal premiums paid on such policies, etc. The two provisions should be read . together and are not. inconsistent. 1

Submission of a controversy upon an agreed, statement of' facts pursuant to section 1219 of the Code of Civil Procedure.

Lawrence Arnold Tanzer, for the plaintiff.

John Kirkland Clark, for the defendant.

Scott, T.:

The matter in controversy between the parties comes before the court upon the submission of an agreed' state of facts.

The plaintiff was an agent.of. the defendant under a contract" dated, September. 15, 1896, which, was for an indeterminate period and was terminated' by the defendant on Tune 15,1905. The ques-' tion involved is as to plaintiff’s, right to receive commissions upon . renewal premiums paid to .and received by the defendant after the termination of the contract, upon policies secured by plaintiff while the contract was in existence. The rule generally applicable to such cases is -well settled by authority, and is not questioned by either party to this, controversy. It is that in tile absence of any stipulation or agreement limiting the agent’s commissions to premiums received by the company during the continuance of. his agency, he is entitled to renewal premiums received after the termi*195nation of his agency, upon policies written during its continuance. (Hercules Mut. Life Assurance Society v. Brinker, 77 N. Y. 435 ; Hale v. Brooklyn Life Ins. Co., 46 Hun, 274; affd., 120 N. Y. 294.) It is open to parties, of course, to make any agreement upon the subject they may see fit, and it becomes our duty to examine the contract between these partiesffo ascertain whether they have made any special agreement respecting renewal commissions which takes this case out of the operation of the general rule above stated.

The contract contains two clauses relating to the payment of commissions. The 20th clause, which is printed, reads as follows: “ 20th. It is agreed that said party of the second part (the plaintiff herein) shall be allowed under this agreement the following compensation only, unless otherwise expressly stipulated in writing, namely: a commission on the original or renewal cash jnemiums which shall during his continuance as said agent of said party of the first part (the defendant herein) be obtained, collected, paid to and received by said party of the first part up to and including the year of Assurance (should his agency continue so long) on policies of insurance effected with said party of the first part, by or through said party of the second part, which commission shall be at and after the following rates.” Then follows a table showing the rate of original commissions to be paid on various claims or kinds of policies.

It is to be observed that this clause, while it evidently contemplates the payment of commissions upon renewal premiums, is careful to limit them to such premiums as shall be received by the company during the continuance of the plaintiff’s agency. It does not, however, specify either the amount of the commission to be paid upon renewals, nor the number of years for which such commissions shall be paid. That omission is supplied by the 21st clause, which is typewritten and which originally applied only to the first year of plaintiff’s agency, but was extended by agreement so as to apply to-every year that the agency contract remained in force. It provides in substance that if in any year the party of the second part should secure new insurance on the plans designated in section 20, “ subject to all the terms and conditions of said section,” amounting to the sum of $15,000, upon which the first cash premium was paid? the plaintiff should be entitled to a commission of five per cent upon such renewal premiums in such policies so written as should renew *196for the second year of assurance, and for every additional $15,000 procured as aforesaid said renewal'should he extended to include an additional year of assurance. ..

The obvious meaning of this clause is that the number óf years during which plaintiff was to be paid a commission on renewals was to be determined by the volume or amount of business influenced and procured by him. Standing by itself this clause would Undoubtedly entitle the plaintiff to be paid a commission on renewals according to its terms,, without regard to’ the termination or continuance of his agency. We’" do not think, however, that we are at liberty to so construe the contract, but that we must read clauses 20 and 2‘1 together in order .to arrive at the true intent of the parties. So reading them .it is plain that the plaintiff was1 entitled to collect commissions only upon such ^renewal premiums as were paid to and received by the company:during the continuance of the agency. Such is the clear and unmistakable language of section 20, and there is nothing in.section 21 expressly to the contrary. In section 201 there is left a blank space with reference to the number of years during which commissions upon-renewals Were to be paid. If that blank had been filled up with any definite number it would have been too plain for argument that the . right to receive commissions upon renewals was-limited by the term of the agency. Section 21 in. effect fills up that blank'and imposes a further limitation upon the right to receive renewal commissions, in that, the period during which they shall become due is limited by the amount of'insurance written.. We find nothing in Clause 21 winch contradicts or abrogates the specific provisions of' clause 20 that Whatever commissions plaintiff may be entitled to shall be limited to premiums received during the' continuance of his -agency-and, therefore, following well-established" rules of construe-tion We must give full effect to" both clauses... '

It follows that there must be- judgment for the . defendant dismissing plaintiff’s claim, with costs."

Patterson, P. J., Laughlin, Houghton and Lambert, JJ., concurred.

• Judgment ordered for defendant* with "costs. Settle order on" notice.

Heyn v. New York Life Insurance
118 A.D. 194

Case Details

Name
Heyn v. New York Life Insurance
Decision Date
Mar 8, 1907
Citations

118 A.D. 194

Jurisdiction
New York

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