author: WOLFE, Judge.

text:
    Lou CAVIC, Plaintiff-Respondent, v. MISSOURI RESEARCH LABORATORIES, INC., a Corporation, Defendant-Appellant.
    No. 32591.
    St. Louis Court of Appeals. Missouri.
    May 16, 1967.

      Sidel & Sandweiss, Jerome I. Kaskowitz, St. Louis, for defendant-appellant.
    Shaw, Hanks & Bornschein, Charles M. Shaw, Claude Hanks, Clayton, for plaintiff-respondent.
   WOLFE, Judge.

This is an action in quantum meruit brought by the plaintiff for the sum of $6,-454.46 claimed to be due him from the defendant as commissions on orders obtained for the defendant company. There was a verdict and judgment for the plaintiff and the defendant prosecutes this appeal.

The petition alleges that plaintiff was employed by the defendant company as a sales representative and that it was his duty as such to obtain “purchase orders for sales to be made by the defendant.” He alleges that he did obtain purchase orders from a list of customers set out in the petition with the amount of each order. They total $169,-089.34. He alleges that the reasonable value of his services in obtaining these “sales orders” was 5% of the total, or $8,454.46. He credits the defendant with the sum of $2,000.00 paid to him and prays judgment for the balance of $6,454.46.

The evidence was that the plaintiff had been in the machine tool business for some time. In 1948 he was employed by the defendant company and worked for them for about two years. He then quit to organize the Cavic Engineering Company which did about the same type of work as the Missouri Research Laboratories. In 1959 he sold his company and he testified that in November of that year he called upon a Mr. Larry Ritshart who was then president of the defendant corporation, Missouri Research Laboratories.

He testified that he and Ritshart met and discussed the matter of going to work for the Missouri Research Laboratories again. He testified about an agreement they reached. It should be noted that at the time of the trial of the case Ritshart was dead but for some reason, not apparent of record, no objection was made on the ground that the testimony violated the “dead man’s statute,” Sec. 491.010, RSMo. 1949, V.A.M.S.

He testified that it was agreed that he was to receive 5% commission on all orders he obtained. Against this commission he was to be paid $500.00 a month as a drawing account and another $200.00 per month as a consultant’s fee. During this time the plaintiff was also employed as a manufacturer’s agent by two other companies manufacturing machine tools.

He worked for the defendant company from February 8, 1960 to July 22, 1960. He testified that he procured orders on eighteen accounts listed in his petition and that the orders have a total value of $169,089.34. He said that the total commission due on these orders was $8,454.46 against which he •credited $2,000.00 paid him on his drawing account by the defendant corporation.

Plaintiff testified, as did an expert witness which he called, that the customary charge for sales, such as those made, was not paid upon the orders obtained but on actual delivery and payment for the goods sold and that where a contract or sale was cancelled in all or in part the salesman received no commission on the part cancelled. He said that he was working as a sales agent for other companies during his employment by the defendant and his commission for sales paid by them was 5% on goods billed and paid for.

It was admitted by the defendant that the plaintiff was entitled to a commission on some of the accounts listed and the total amount of sales made to these customers amounted to $15,455.27. Of the nine remaining accounts there were five of them totaling orders of $9,465.80 which the plaintiff by his own admission did not procure. Another of the remaining accounts was the account of Magnavox Company. On this account plaintiff claimed commission of 5% on $100,333.28. One of the orders in the sum of $28,560.00 that went to make up the total was received by the defendant company on February 17, 1960. The plaintiff admitted that he had nothing to do with obtaining that order. He was permitted to testify over the objections of the defendant that he was entitled to the commission on all of these orders by reason of his verbal agreement with Ritshart which gave him commissions on any orders obtained in the territory where the Magnavox plant was located.

The defendant contends that the plaintiff was entitled only to 5% on orders sold, delivered, and paid for. According to defendant’s evidence and supported by plaintiff’s admissions the plaintiff rendered no service on $43,985.80 of the orders upon which he claims commissions. The evidence further shows that on those orders obtained by the plaintiff some orders were reduced which actually made the sales by the defendant company $30,936.46 less than the original order.

The first contention raised by the appellant corporation is' that it was entitled to a directed verdict. This conclusion is reached by adopting the premise that the plaintiff is entitled to a commission only on sales made and concluded, basing the percentage on the purchase price of the goods actually delivered. It is next contended that for the orders actually obtained by the plaintiff resulting in completed sales the defendant has been fully paid.

The plaintiff conversely asserts that the value of his services is based upon the contract which he said that he had with the deceased president of the defendant corporation. He asserts that he is entitled to the 5% on all the listed accounts whether he obtained the order or not and without regard to any cancellation or change in the amount of the order.

We consider first appellant’s contention that the reasonable value of the services was the commission on the actual sales made of goods delivered. As stated this is an action on quantum meruit. This theory rests upon the principle that no one ought to enrich himself unjustly at the expense of another. The burden of the plaintiff who relies upon it is to prove the reasonable value of the services he rendered. Knoch v. Frye, Mo.App., 363 S.W.2d 737; Beckemeier v. Baessler, Mo., 270 S.W.2d 782; Fitzgerald v. Schaefer, Mo.App., 216 S.W.2d 939.

Respondent contends that the contract about which he testified at some length, and with added variations from time to time, was prima facie evidence of the reasonable value of his services. It is true that a contract of employment is prima facie evidence of the reasonable value of the services rendered under it, Oliver L. Taetz, Inc. v. Groff, 363 Mo. 825, 253 S.W.2d 824. However, it is also true that prima facie evidence is not conclusive evidence. As we stated in City of Jackson ex rel. Hoffmeister v. LaChance, Mo.App., 372 S.W.2d 479, 1. c. 482: “The words ‘prima facie evidence’ of course only means such evidence which is in law sufficient to establish the fact, and if not rebutted it remains sufficient to support a judgment upon the fact so established. * * * ” Brotherhood of Stationary Engineers v. City of St. Louis, Mo.App., 212 S.W.2d 454, 1. c. 459.

The reasonable value of services as that term is employed in actions in quantum meruit is “ * * * the price usually and customarily paid for such services or like services at the time and in the locality where the services were rendered. * * * ” Baker v. Brown’s Estate, 365 Mo. 1159, 294 S.W.2d 22, 1. c. 27. By his own testimony the plaintiff fixed the reasonable value of the services when he stated that he and other salesmen in his line of sales customarily were paid 5% on the sales made and consummated. At that point anything in the contract to the contrary lost its evi-dentiary worth as to the value of the services. To hold otherwise would permit one to sue on quantum meruit and recover on an unpleaded contract. This he cannot do. Kansas City Structural Steel Co. v. Athletic Bldg. Ass’n, 297 Mo. 615, 249 S.W. 922; Hunt v. Riggins, Mo.App., 341 S.W.2d 136. We conclude therefore that the plaintiff was entitled to commission only on completed sales that he procured.

The second contention upon which appellant claims he was entitled to a directed verdict is that the plaintiff has been actually overpaid. This conclusion is reached by excluding from consideration $62,250 in sales to Magnavox Company on the theory that there was no testimony of service by the plaintiff in connection with those sales. With this we cannot agree as there was some testimony by the plaintiff of contact made with the Magnavox Company from which the jury could conclude that the efforts of the plaintiff were the procuring cause of those particular sales. The plaintiff would consequently be entitled to a commission upon those sales subject to any credit for payments made to him and properly chargeable against such commissions. Therefore the court did not err in refusing' to direct a verdict for the defendant.

It is further contended that the court erred in giving a verdict directing instruction at the request of the plaintiff, designated as Instruction No. 2, which is. as follows:

“ ‘Your verdict must be for the Plaintiff if you believe:
1. Plaintiff was employed by defendant to perform services as a sales representative on behalf of defendant, and
2. That plaintiff was to be paid on the basis of the gross amount of purchase-orders obtained for the defendant by the Plaintiff, and
3. Plaintiff has not been fully compensated by defendant for the reasonable value of services performed by Plaintiff as a sales representative on behalf of defendant.’ ”

The Instruction is obviously erroneous as the second paragraph can only be construed to refer to the contractual agreement. As. we stated above one may not sue in quantum meruit and recover on an unpleaded contract. Kansas City Structural Steel Co. v. Athletic Bldg. Ass’n, supra; Hunt v. Rig-gins, supra.

Throughout the trial the court erroneously treated the action as one on contract and the error in so doing was carried forward into the Instruction.

Other matters complained of need not be passed upon as the case must be retried in a manner consistent with views herein expressed. The judgment is reversed and cause remanded for a new trial.

ANDERSON, P. J., and RUDDY, J_ concur.


source: Caselaw Access Project

author: RUDDY, Judge.

license: Public Domain

text:
    Hope L. MEYERS, Plaintiff-Appellant, v. STATE FARM LIFE INSURANCE COMPANY, a Corporation, Defendant-Respondent.
    No. 32542.
    St. Louis Court of Appeals. Missouri.
    May 16, 1967.
    Motion for Rehearing or for Transfer to Supreme Court Denied June 14, 1967.
    Application to Transfer Denied Sept. 11, 1967.

      Mogab & Hughes, St. Louis, for plaintiff-appellant.
    Evans & Dixon, John C. Shepherd, Paul V. Gilbert, St. Louis, for defendant-respondent.
   RUDDY, Judge.

This is an action by plaintiff, a widow, on a life insurance policy. A jury trial was waived. Plaintiff appeals from a judgment in favor of defendant.

The primary question for determination is: What was the effective date of the policy? Plaintiff contends it was April 9, 1963, the date of the delivery of the policy to insured. Defendant contends it was March 28, 1963, the “policy date.” The trial court found March 28, 1963 as the effective date of the policy and found premiums were due on the 28th day of each month.

The defendant, State Farm Life Insurance Company, issued its policy of insurance dated March 28, 1963, insuring the life of John M. Meyers. In this policy plaintiff, Hope L. Meyers, is stated as the beneficiary of the death benefit, which is $10,000. The insured, John M. Meyers, was killed on May 24, 1964. Plaintiff contends that the aforesaid policy of insurance was in full force and effect on that date. Defendant contends that the policy lapsed prior thereto for non-payment of premium.

Defendant’s agent, R. G. “Roy” Sippel, was produced as a witness by plaintiff. On or about March 20, 1963, insured and his wife called at the office of Sippel, agent for the defendant. Insured told Sippel that he had permitted a policy he had with another company to lapse and for that reason he was interested in obtaining insurance. In the course of discussing the application for the insurance, insured said to Sippel, “ * * * ‘Roy, I’ll take this application, but I don’t have the money tonight and I’ll pay you in about two weeks.’ ” Sippel said that he advanced the initial premium of $17.80 and in the course of his testimony said, “Now, this was the understanding between Meyers and I.” Attached to the application was a Conditional Binding Receipt which Sippel tore off and in his testimony stated that the original application showed that a Binding Receipt was issued with regard to this particular policy. Sip-pel said, when the application was sent in to the defendant company he sent his check to cover the payment of the first premium of $17.80 which represented the first monthly premium. Other parts of this witness’ testimony will be stated later.

We now recite pertinent parts of the application. Under the portion of the application designated “Agent’s Statement” appear the following questions and answers:

“5. What settlement was made for the initial premium? $17.80 cash.
“6. Was a Conditional Binding Receipt issued? Yes.
“7. What amount of premium was stated to the Proposed Insured? $17.80.
“8. What shall be the regular mode of premium payment ? Monthly.”

The application showed that it was received in the office of defendant company on March 25, 1963. The application was dated March 20, 1963. Other pertinent parts of the application are as follows: (On Page One)

“If a Conditional Binding Receipt referring to this application has been duly signed and issued by an authorized agent of the company, on the date this application is signed, then the terms of such Conditional Binding Receipt shall be effective. Otherwise it is understood and agreed that the company shall incur no liability under this application until, during the lifetime and continued insura-bility of the Proposed Insured and any other person proposed for insurance hereunder, (1) it has been received and approved, (2) a policy issued and delivered, and (3) all or a part of the initial premium specified in the policy paid, in which case such policy shall be deemed to have taken effect as of the Policy Date as recited on the first page thereof.” (Emphasis ours.)

Under question 7, page 1 is the following:

“(h) How shall dividends be used? Accumulate.”

The pertinent parts of the policy are as follows:

“The insurance provided by this policy, beginning on the Policy Date, is granted in consideration of the application and of the payment of premiums of Sixteen and 50/100 Dollars on the 28th day of each month in each policy year during the lifetime of the insured, the first such payment being due on the Policy Date.
“In witness whereof, the State Farm Life Insurance Company, at its Home Office in Bloomington, Illinois, has caused this policy to he executed on the Policy Date, March 28, 1963.”

In the General Section of the policy appears the following:

“Entire Contract. This policy and the application herefor, a copy of which is attached hereto and made a part hereof, constitute the entire contract. * * *
“Dividends. Annual dividends such as the company may apportion shall be payable while this policy is in force, other than as extended term insurance, without condition as to the payment of any subsequent premium. The insured shall have the option of electing in writing that each dividend payable be: * * * (3) left to accumulate at compound interest at a rate not less than two per cent per annum, any accumulated dividends not applied under Credits to Avoid Lapse to be added to, and to be a part of, the sum payable upon the death of the insured, or upon maturity as endowment, or upon surrender for cash, or to be withdrawable in cash at any time; * * *. If the insured does not elect one of the preceding methods in writing, method (3) shall automatically apply. * * * ”
“Grace Period. A grace period of thirty-one days shall be allowed, without interest, following the due date for the payment of any premium after the first. During such grace period this policy shall remain in force but if the premium due on such due date is not paid before the end of such grace period this policy shall lapse, except as provided under Credits to Avoid Lapse and Automatic Premium Loan. If death occurs within the grace period, the premium or any balance thereof, if unpaid, will be deducted from the death benefit.
“Credits to Avoid Lapse. Without direction by the insured, * * * and any accumulated dividends under dividend method (3) shall be applied successively toward the payment of any premium unpaid at the end of the grace period. If the total of such credits shall be less than such unpaid premium, such credits shall be applied as a pro rata premium as of the due date of such unpaid premium and on the day immediately following the last day of any pro rata premium payment period the unpaid balance of such premium shall be due and payable. A grace period shall be allowed for the payment of such unpaid balance as provided under Grace Period.”

The non-forfeiture section of the policy provides for extended term insurance if any premium or balance thereof remains unpaid at the end of the grace period after applying Credits to Avoid Lapse and Automatic Premium Loan and if a cash surrender value is available. The Table of Values in the policy show that no cash surrender or maximum loan value was available until the end of the third policy year. This policy had been in force only one year.

As indicated previously the basic premium due monthly was $16.50. In addition to the basic premium insured agreed to pay $1.30 monthly for the privilege of purchasing additional insurance on his life without evidence of insurability, subject to conditions in the policy which we need not recite. This made the total premium due monthly $17.80.

Referring again to the testimony given by Sippel in plaintiff’s case, he said that the Conditional Binding Receipt was torn off of the original application and again said that the original application showed that a Binding Receipt was issued with regard to the policy. He admitted that he did not turn the Conditional Binding Receipt over to the insured because the insured did not pay him, stating, “I advanced the money for him.” Approximately two weeks after the application was executed by the insured, Sippel, under date of April 2, 1963, wrote to the insured and his wife stating, “There is due me the first monthly premium of $17.80.” In this same connection plaintiff introduced in evidence Sippel’s copy of an invoice, dated April 2,1963, the original of which had accompanied the aforementioned communication of the same date, wherein it was shown that the first premium on the life insurance policy was due Sippel. This same invoice also showed that Sippel had advanced on March 25, 1963 a membership fee due on an automobile insurance policy. In the course of the re-direct examination of Sip-pel by plaintiff’s counsel the following questions were asked and answers given:

“Q. Mr. Sippel, when a policy is issued, including a conditional binding receipt, sir, what is the effective date of the policy ?
“THE WITNESS: The company issues the policy.
“Q. With a conditional binding receipt, sir?
“A. With a conditional binding receipt?
“Q. Yes.
“A. Used or not used?
“Q. Used.
“A. In this case, so I understand you clearly, this policy was issued by the company with the fact that they had the $17.80 for the first month’s premium.
“Q. Where you have a conditional binding receipt, sir, is not the effective date of the policy the date of the application?
“A. No. The date of the policy would be, the effective date of the policy would be the date of issuance.
“Q. Even where you have a conditional binding receipt?
“A. What are you trying to get to, I believe, is were this application going in with the initial premium being paid, that had death resulted to John Meyers prior to me receiving a policy from the company, the company would have paid off under this condition.”

The insured picked up the policy in Sip-pel’s office on April 9, 1963. That is the date it was delivered to the insured.

Plaintiff, the beneficiary, testified that she and her husband, the insured, had done business with Sippel prior to the occasion when her husband signed the application for the life insurance. She said they had bought automobile insurance from Sippel previously, but that this was the first life insurance policy bought from Sippel. She said that to her knowledge her husband did not pay for any life insurance on the particular occasion in question and when asked if she overheard all of the conversation between Sippel and her husband, she answered, “I wasn’t paying too good attention.” She said she overheard nothing concerning payment on the contract of insurance by her husband and heard nothing about the effective date of the contract.

It was undisputed that a single dividend in the amount of $7.50 was credited to the policy as of March 28, 1964.

Norman K. Martin, an actuary for the defendant company, was produced as a witness by plaintiff. In response to a question by plaintiff’s counsel as to the amount of days of extended term insurance which could be purchased for the dividend credit of $7.50, the witness said that if the dividend credit had been available to purchase the amount of $10,000, which was the face amount of the policy, that the term of additional insurance would- have been ninety-one (91) days; however, this witness did say that according to the policy terms the dividend credit of $7.50 was not available for the purchase of extended term insurance. The dividend credit of $7.50 was available under the terms of the policy to purchase 12.8 days of ordinary life insurance, which was “rounded out” to 13 days.

The premium due February 28, 1964, according to defendant’s records, was received by defendant on April 2,1964. This was the last premium paid by insured and was the only monthly premium paid during the year after the expiration of the Grace Period. All other monthly premiums were paid when due or within the Grace Period.

In reviewing this case we are mindful of the admonition of Civil Rule 73.01(d), V.A.M.R. that we shall review the case upon both the law and the evidence as in suits of an equitable nature. The judgment shall not be set aside unless clearly erroneous, and due regard shall be given to the opportunity of the trial court to judge of the credibility of the witnesses.

Plaintiff contends the effective date of the policy was April 9, 1963, the date the policy was delivered to the insured. In support of this contention plaintiff says no Conditional Binding Receipt was issued to insured when he signed the application. This being true, plaintiff contends that the effective date is not that called for in the Conditional Binding Receipt, but is the effective date called for in the application when no Conditional. Binding Receipt is issued and in this regard relies on this language of the application, namely;

“ * * * Otherwise it is understood and agreed that the company shall incur no liability under this application until, during the lifetime and continued insurability of the Proposed Insured and any other person proposed for insurance hereunder, (1) it has been received and approved, (2) a policy issued and delivered, and (3) all or a part of the initial premium specified in the policy paid, in which case such policy shall be deemed to have taken effect as of the Policy Date as recited on the first page thereof. * * * ” (Emphasis ours.)

However, plaintiff contends that while this language indicates that the policy shall take effect as of the policy date, it also indicates that the policy will not be effective until delivered to the proposed insured, “during (his) lifetime and continued in-surability.” She says that because of these conflicting statements the contract is clearly and patently ambiguous. She says either the policy commenced on March 28, 1963 or it commenced on the date of its delivery to the insured during his lifetime and continued insurability which she contends was April 9, 1963. Plaintiff says this obvious ambiguity must, under the Missouri Law, be resolved in favor of the insured and cites in support thereof the cases of Halsey v. American Central Life Ins. Co., 258 Mo. 659, 167 S.W. 951 and Hampe v. Metropolitan Life Ins. Co., Mo.App., 21 S.W.2d 926. These cases state the general rule that where the insurer makes delivery in good health a condition of the policy, the policy does not take effect until delivery. Using April 9, 1963 as the effective date of the policy, plaintiff attempts to show that the Grace Period provided in the policy and the language of the “Credits to Avoid Lapse” paragraph of the policy, which provided for the application of any dividends available toward the payment of any premium unpaid at the end of the Grace Period, carry the coverage under the policy up to midnight of May 23, 1964. Plaintiff then points out that under the language of the “Credits to Avoid Lapse” paragraph of the policy the unpaid balance of such premiums would be due and payable “ * * * on the date immediately following the last day of any pro rata premium payment * * *.” She contends, therefore, that the balance of the premium was not due until May 24, 1964, the date of her husband’s death, and that the policy coverage lasted until midnight of May 24th and, therefore, she is entitled to the policy proceeds.

We need not determine if plaintiff’s construction of the policy provisions or her mathematical computation under her contention is correct because we do not agree with plaintiff’s contention that the policy ■did not take effect until April 9, 1963. We think the effective date of the policy was March 28, 1963, the date the policy was executed. We disagree with plaintiff’s basic premise that no Conditional Binding Receipt was issued. We find that plaintiff’s own evidence demonstrates that the Conditional Binding Receipt was torn from the application by Sippel; that upon the request of the insured Sippel paid the first monthly premium and that a Conditional Binding Receipt was executed by Sippel as an authorized agent of the defendant on the date the application was signed; that while the Conditional Binding Receipt was not actually placed in the hands of the insured, Sippel at the request of the insured paid the first monthly premium for the insured and thereby became the agent of the insured for this purpose and that the holding of the receipt by Sippel was done as the agent of the insured and was retained by Sippel until such time as the insured paid him the money that he had advanced for the insured.

When a Conditional Binding Receipt is executed and issued the language in the application relied on by plaintiff is not applicable. That is only applicable when a Conditional Binding Receipt has not been ■executed and issued. When one has been •executed and issued then the policy shall be effective according to the terms of the Conditional Binding Receipt, which, ac-eording to Sippel, who testified for plaintiff, would be the date the policy was issued, namely, March 28, 1963.

We are aware that the general rule in regard to agents is that the same •person can not act as agent for both the •company and insured. However, this rule is subject to some exceptions. The same •person may act for the different principals in separate matters in which their interests .•are not conflicting and his duties not inconsistent. It is possible for an insurance company agent to become during the progress of the negotiations the agent of the insured; and in that event he may acquire rights, have powers, and incur obligations respecting both insurer and insured. The same person may act in both capacities; he may be the agent for insured, although as to the procuring of the insurance he also represents the company. Whether in a particular case or particular matter one acts as agent for the company or for insured depends upon the intention of the parties, which is to be determined from the facts and circumstances of the case. 44 C.J.S. Insurance § 141, pp. 802 and 803.

An actual payment of the premium by an agent of the company to it is generally held to be as effectual as one made by the insured himself, unless it is made without the request, direction, or ratification of insured. Where the agent of the company, on his individual responsibility, extends credit for the premium to insured and pays the amount due, or is charged with it by, the company, such payment or charge inures to the benefit of insured and consummates the contract, unless the transaction is without the knowledge, consent, or ratification of insured. 44 C.J.S. Insurance § 272(3), pp. 1087, 1088.

We think the facts and circumstances shown in evidence in plaintiff’s own case demonstrate clearly that Sippel was acting as agent for the insured when he advanced the amount of money to the insured necessary to pay the first monthly premium and indicated on the application that he had received $17.80 in cash from the insured. Sippel’s testimony, elicited by plaintiff, shows that this was the understanding between insured and himself. As plaintiff’s evidence shows, insured had let another policy of insurance lapse and was desirous of immediate coverage. The insured informed Sippel that he would take out the application but told Sippel that he did not have the money at the time of signing the application and promised to pay Sippel in two weeks. This act of Sippel in advancing the premium for and at the request of insured was not in conflict with nor inconsistent with his duties owed to defendant insurance company. There is no doubt that the first monthly insurance premium was advanced by Sippel for the insured with the knowledge, consent, and ratification of the insured. Also, plaintiff’s evidence shows that after the application had been forwarded to the defendant company, the first premium advanced by Sippel for the insured was due to Sippel. Plaintiff’s evidence is clear that a Conditional Binding Receipt had been executed and that defendant insurance company had received full payment of the first monthly premium. Under the circumstances insured had insurance coverage, according to the evidence in plaintiff’s case, from the time the insurance policy was issued. If the insured’s death had occurred between March 28, 1963, and April 9, 1963, we feel certain that plaintiff would have made a claim of coverage under the policy. She would then be insisting that Sippel, as agent for the insured, held a Conditional Binding Receipt as insured’s agent, and further, plaintiff would now be insisting that Sippel was the agent for the insured in forwarding the first monthly premium. Such a claim would have been proper.

In the case of Gaines v. Berkshire Life Ins. Co., 228 Mo.App. 319, 68 S.W.2d 905, the court said, if the credit for the first premium was extended by the general agent, personally, then he was the agent of the insured in the matter and did not act on behalf of the company in this respect.

In the case of Nall v. Great Northern Ins. Co., Mo.App., 135 S.W.2d 392, when plaintiff signed the application the agent for the defendant insurance company told him that his insurance would be in force “ * * * ‘right then and there, * * * on the signing of the application.’ * * * ” The agent told plaintiff that he, the agent, would give him time to pay the $6.00 which was the amount necessary to pay the premium on the insurance for the first three months. The agent told plaintiff that he would extend him credit for this payment until plaintiff received his next paycheck. Plaintiff testified that pursuant to his agreement he left the money for the premium with a Mr. Pritchett but that the agent did not call for it and he had not paid to anyone any part of the amount of premium up to the time he received his injury. The court said: (l.c. 396)

“The agreement of the agent that he, personally, would extend credit for the payment of the premium due on the insurance, was not in conflict with any of the terms of the application or the policy * * * and the policy went into effect when the application was accepted by the company, the policy issued and the agent was charged on defendant’s books for its part of the premium. * * * It was unnecessary for the policy to have been delivered to insured. * * * ”

In the case of Prudential Insurance Company of America v. Burch, 268 F.2d 159, the United States Court of Appeals, Eighth Circuit, had before it an action to recover on a life policy. In applying the law of the State of Missouri it held that a life insurance policy which provided that if the first premium was paid at the time the application for the insurance was made and the insurer determines that the applicant was insurable, the insurance should take effect as of such date, that such a policy became effective as of the date the policy was issued and provided for premium payments, and was not as of the date the policy was delivered to the insured. The facts in that case are similar to the facts in the instant case. The court held that the policy had lapsed for non-payment of premium prior to the insured’s death, holding that the policy was not in effect on the date of insured’s death occurring on the anniversary of the delivery of the policy. In the aforesaid case the designated beneficiaries, as plaintiffs, cited and relied on the cases of Halsey v. American Central Life Ins. Co., supra and Hampe v. Metropolitan Life Ins. Co., supra. The court rejected these cases as support for the designated beneficiaries’ contention, holding that the effective date of the policy was not the date the policy was delivered. The court pointed out that in the Halsey and Hampe cases there were express provisions that no insurance would become effective until the policy was first issued and delivered.

The aforesaid authorities demonstrate clearly that the same person may be both an agent for the company and for the insured and, therefore, in the instant case, where Sippel paid the premium for the insured he thereby became insured’s agent. For this reason we think that plaintiff can not now be heard to say that the Conditional Binding Receipt was not issued to the insured.

Plaintiff next contends that defendant, by consistently accepting late premiums, has waived strict enforcement of the policy lapse provisions and is now estopped to deny that coverage was not in effect on May 24, 1964. We have shown that six of the payments were made on or before the due date, five of them were made within the Grace Period, and one was made after the expiration of the Grace Period. We agree with defendant that the payment of one of the premiums after the expiration of the Grace Period does not establish a policy of consistently accepting late premiums. As to those that were paid within the Grace Period the insured had a contractual right to make these premium payments during the Grace Period and as defendant points out, it was required to accept all the premiums paid during the Grace Period.

In the final contention of plaintiff she says that the $7.50 dividend should have, under the non-forfeiture laws, been used to purchase ninety-one days of term insurance instead of thirteen days of whole life. The non-forfeiture statutes she refers to are Sections 376.630 and 376.660 of the Revised Statutes of Missouri, 1959, V.A.M. S. The purpose of these sections of the statutes is to prevent forfeiture of all the reserve value of the policy when the policy lapses for non-payment of premium. These statutes are to secure to the insured who has paid premiums for three or more years at least three-fourths of the reserve value of the policy, which reserve represents the excess of premiums paid over the cost and expense of carrying the insurance to the date of lapse. Obviously, these statutes have no application to the policy in question because the statutes provide that a policy must provide a cash value after payment of premiums for three or more years. It is undisputed in the instant case that the premiums were paid only for a period of one year. Further, the reserve value under a policy and statutes is not to be confused with accumulated dividends. They are not synonymous in meaning. There was no reserve value in this policy and under the terms of the policy there would be none until the end of the third policy year. No cash value under the terms of the policy was provided prior to the end of the third policy year. The provisions of the policy in this respect were in full and complete compliance with the non-forfeiture statutes of Missouri. There is no provision under the statutes or under the policy for the purchase of term insurance through the use of the accrued dividend.

In this same connection plaintiff contends that the dividend of $7.50 should have been used to purchase extended ordinary life coverage at the annual (as distinguished from monthly) premium payment rate contending that the higher monthly cost can not be justified. In support of this plaintiff relies upon testimony of the actuary for defendant company that if the dividend accrual is based on an annual premium payment “ * * * in all likelihood it could well provide some additional coverage.” The simple answer to this contention is that the insured elected to pay the premiums on a monthly basis and not on an annual basis. No doubt, as a result, the twelve monthly premiums would exceed the annual rate; however, as pointed out by the actuary the $7.50 dividend was based upon monthly premium payments and on this ■basis the dividend provided thirteen additional days of whole life insurance.

The effective date of the policy was March 28, 1963, and not April 9, 1963, and therefore the policy of insurance was not in effect on the date of the death of the insured. Plaintiff does not contend that there was coverage if the effective date of the policy was March 28, 1963. We find no error in the trial court’s judgment. It should be affirmed. It is so ordered.

ANDERSON, P. J., and WOLFE, J., concur.


author: CLEMENS, Commissioner.

text:
    John J. RELLES, Plaintiff-Respondent, v. Eugene W. WINES, Defendant-Appellant.
    No. 32482.
    St. Louis Court of Appeals. Missouri.
    May 16, 1967.
    John D. Connaghan, St. Louis, for appellant.
    Norman Zaltsman, Clayton, for respondent.
   CLEMENS, Commissioner.

By this court-tried action the plaintiff got a $6,900 judgment for money he had loaned the defendant. The defendant contended that the money had not been loaned to him personally, but to a corporation he controlled.

On this appeal the defendant first contends the evidence does not support a personal judgment against him. The decisive factual issue is whether plaintiff loaned money to the defendant personally or to the corporation. The defendant also raises two legal issues: that plaintiff accepted payment, partly in money and partly by a note from the corporation, and that this constitutes a novation; further, the defense of tender, claiming he offered plaintiff full payment of the corporate note.

We must first weigh the evidence to determine whether the loan was personal or corporate. If we find it was a personal loan, we will then pass upon defendant’s further defenses of novation and tender.

The pleadings are simple. Plaintiff’s petition, insofar as it pertains to the issues tried, alleged that on January 10, 1961, he loaned the defendant $9,600 for an investment by defendant in the Candeb Corporation, an Illinois corporation; that defendant had paid only $2,500 of the loan; and that the defendant had refused to pay plaintiff the $7,100 balance of the loan, for which amount, with interest, plaintiff prayed judgment. By his answer, defendant admitted “that money was borrowed from the plaintiff for the use of the Candeb Corporation and that the plaintiff was well aware of this fact and knew that this foresaid money would be used for the benefit of the corporation solely and not for the benefit of this defendant, Eugene W. Wines.”

The plaintiff’s evidence: Plaintiff John J. Relies and defendant Eugene W. Wines were lawyers, both active in practice in St. Louis. Early in 1961 the defendant was promoting the Candeb Corporation, a prospective developer of dormitories at Southern Illinois University. Candeb was seeking a $1,200,000 construction loan. The defendant told plaintiff he had raised $40,000 to invest in the corporation but had to increase his investment by $10,000 to qualify Candeb for the construction loan. At first plaintiff told the defendant no; he could not raise that much money without selling all his securities. Defendant promised that if plaintiff would loan him $10,000 he would (1) give plaintiff his and his wife’s six-month, six per cent note, (2) pay plaintiff an additional amount to cover his brokerage expense and loss of dividends from the sale of plaintiff’s stocks, and (3) pledge 20 per cent of Candeb’s stock as collateral. Finally the plaintiff was persuaded.

Plaintiff raised $9,600 and gave defendant a check for that sum, payable to defendant personally. The defendant endorsed the check, put $8,000 in Candeb’s bank account and kept $1,600 in cash. Time passed. The defendant did not yield to plaintiff’s repeated requests for the promised note and collateral, so plaintiff demanded full payment of the loan. On July 6, 1961, the defendant paid plaintiff $2,500. This payment was made by a check signed by defendant but drawn on Candeb’s bank account. Later, the defendant twice paid plaintiff $100 in cash. In December, 1961, defendant sent plaintiff a promissory note for $6,700, signed by him as president of Candeb Corporation. Plaintiff kept the corporation’s note but protested that the balance due was $7,100, not $6,700, and that he was looking to the defendant and his wife, not Candeb, for payment. Then in April of 1962 the defendant gave plaintiff his personal check for $6,867.50, marked “In full payment of promissory note of Candeb Corporation of Dec. 14, 1961.” Plaintiff refused the check, saying “I want every penny you owe me, not a penny less.”

Plaintiff introduced two of Candeb’s financial statements dated in July of 1961 and March of 1962; neither showed plaintiff as a creditor. At some unspecified time Candeb went through dissolution proceedings. On December 3, 1963, defendant sued Candeb for money he claimed to have loaned Candeb, and. got a default judgment. In contrast to Candeb’s shaky financial condition, the defendant was solvent. His personal financial statement given in 1962, in connection with the proposed construction loan to Candeb, showed a substantial net worth. That was plaintiff’s case.

The defendant’s evidence: Late in 1960 the defendant and three others organized Candeb Corporation to develop a tract of land for college dormitories. Defendant needed more money to invest in Candeb and asked plaintiff to loan the corporation $10,-000. Defendant promised that plaintiff would get his money back with six per cent interest, plus a bonus of $2,500, when Can-deb negotiated a million-dollar-plus loan. Defendant received plaintiff’s $9,600 check, payable to the defendant personally. Plaintiff told defendant he did not need the corporation’s note, that the canceled check would be a sufficient receipt. Defendant endorsed the check; he put $8,000 in Can-deb’s bank account and gave $1,600 in cash to other incorporators to pay organization expenses.

Defendant said that in July of 1961 plaintiff told him he wanted some of his money back, so defendant gave him a $2,500 check drawn on Candeb’s bank account. Defendant admitted he made the two $100 cash payments to plaintiff — and said he had actually paid him $750 in cash. Receipts were neither requested nor given. Defendant explained that since there was no money available in Candeb’s bank account at the time, he advanced the money personally, expecting Candeb to refund it when its construction loan went through. On December 14, 1961, ten months after plaintiff’s loan, the defendant mailed Candeb’s $6,700 promissory note to plaintiff. Defendant said that was the amount then due. The note carried neither a due date nor provision for interest. Four months later defendant tried to pay off this note by offering plaintiff his personal check for $6,867.50, but plaintiff refused it. Defendant explained that the check was on his personal account because Candeb still did not have the money; that he expected to get it back from Candeb when the construction loan was completed.

The defendant offered in evidence plaintiff’s letter of April 23, 1962, to Mr. Gerald A. Weiss, a realtor who was trying to negotiate Candeb’s construction loan. In this letter plaintiff said his claims against defendant and Candeb “have been amicably resolved.” Plaintiff had told Mr. Weiss earlier that he, plaintiff, had a pledge of 20 per cent of Candeb’s stock. On cross-examination plaintiff explained the statement about claiming he had a stock interest in Candeb. He said he had learned that Can-deb’s loan would not be made without the consent of all its stockholders. He testified: “I was going to put the kabash (sic) on their getting a loan from the Teamsters if I didn’t get my money.” Plaintiff did not explain the letter wherein he told Mr. Weiss that his claims against the defendant and Candeb had been resolved.

That was the pertinent evidence. As said, the decisive question is whether the evidence justifies a finding that plaintiff loaned money to the defendant personally, rather than to the corporation.

The plaintiff and the defendant flatly contradicted each other about who borrowed the $9,600, defendant or Candeb. Plaintiff is impeached by his statement to Mr. Weiss that he, plaintiff, had a pledge of 20 per cent of Candeb’s stock when in fact he did not. He is further impeached by his letter to Mr. Weiss saying his claims against Candeb and the defendant “have been amicably resolved.” The statement and the letter were admittedly false. However, these inconsistencies in plaintiff’s evidence are outweighed by other facts that are even more inconsistent with the defendant’s contention that the loan was made to Candeb: The plaintiff’s $9,600 check was payable to the defendant personally, not to Candeb. The defendant admittedly held out $1,600 of the loan, without showing any record that it went for corporate purposes. Defendant personally paid plaintiff either $200 or $750 in cash without any record showing it was paid for the corporation. The corporate note was not issued until ten months after the loan was made. Over a year after the loan was made the defendant tried to pay the note with his personal check. Candeb’s two financial statements did not show any indebtedness to plaintiff. The defendant’s personal solvency and the corporation’s insolvency gave the defendant a motive for trying to shift the obligation from himself to the corporation.

We have weighed the evidence, as is our duty under Civil Rule 73.01(d), V.A. M.R., in a court-tried case. We have heeded that rule’s directions that “[t]he judgment shall not be set aside unless clearly erroneous, and due regard shall be given to the opportunity of the trial court to judge of the credibility of the witnesses.” We resolve this factual issue as the trial court did, in favor of the plaintiff. We pass on to the defenses of novation and tender.

In his motion for new trial and in his brief' the defendant argues that the plaintiff by retaining Candeb’s $6,700 note thereby released the defendant as the original debtor and accepted Candeb as his creditor. This defense of novation must fail, for several reasons. It was an affirmative defense of release but was not pleaded as required by Civil Rule 55.10, V.A.M.R. Morriss v. Finkelstein, Mo.App., 145 S.W.2d 439 [6]. Nor was there clear and convincing evidence of plaintiff’s release of defendant as his original debtor and his acceptance of Candeb as his new creditor, all that being required for a novation. Negbauer v. Fogel Construction Co., Mo.App., 53 S.W.2d 346 [8, 9], If further reason be needed for denying the defense of novation, we point to its utter inconsistency. This, because defendant contended that from the inception of the loan it was Candeb, not he, who promised to pay the plaintiff.

The defendant’s last contention is that by his offering plaintiff the $6,867.50 check on April 18, 1961, he has established a defense of tender, thereby stemming the accrual of interest under Civil Rule 77.23, V.A.M.R. That defense, even if valid, was neither pleaded nor preserved in defendant’s after-trial motion. It is not preserved for review. Hart v. John W. Rowan Plastering Co., Mo.App., 88 S.W.2d 264 [2, 3]; Civil Rule 79.03, V.A.M.R.

The judgment is affirmed.

PER CURIAM.

The foregoing opinion of CLEMENS, C., is adopted as the opinion of this court. Accordingly, judgment is affirmed.

RUDDY, Acting P. J., WOLFE, J., and THEODORE McMILLIAN, Special Judge, concur.


author: TOWNSEND, Commissioner.

text:
    I. L. PARKS, Plaintiff-Appellant, v. MIDLAND FORD TRACTOR COMPANY, a corporation, Defendant-Respondent.
    No. 32606.
    St. Louis Court of Appeals. Missouri.
    May 16, 1967.

      J. Andy Zenge, Jr., Dennis W. Smith, Canton, C. Kenneth Thies, Clayton, for appellant.
    Shepley, Kroeger, Fisse & Shepley, - George S. Hecker, St. Louis, for respondent.
   TOWNSEND, Commissioner.

Action for breach of an alleged oral contractual promise to pay a certain employment “bonus” for the calendar year 1963. A nine-man (and lady) verdict for defendant was returned. After a motion for a new trial was overruled appeal was taken to this Court.

After a brief term of employment in another capacity plaintiff and defendant’s president, Mr. Woods, entered into an oral agreement in June 1961 for plaintiff to act as general sales manager of defendant. In this capacity plaintiff operated for the balance of the year 1961 and received the same salary as before plus transportation and all expenses when away from home. Shortly after the beginning of the year 1962 plaintiff was importuned by defendant’s president to take upon himself the position of general manager of the company ; plaintiff accepted. The crux of the present controversy is found in the agreement reached at this time. The agreement was entirely oral; the conversation occurred in the president’s office with no other person present. Plaintiff testified that under the agreement reached at that time plaintiff was to be paid, in addition to a stated salary, a certain bonus if gross sales exceeded a named amount plus another conditional bonus, graduated upward from $10,000, if the net profits of the company before taxes equalled or exceeded $200,000. Defendant’s president categorically denied that there was any agreement for the payment of the latter bonus; the other principal terms as above stated were not contradicted.

Around the first of the year 1963 the president informed plaintiff that his salary for the year would be increased to a stated amount; plaintiff testified that the president told him that the new salary arrangement “would not in any way affect my bonuses.” Plaintiff does not recall whether the president elaborated on what bonuses were referred to. On January 18, 1963, the president wrote a letter to plaintiff, advising him of the salary increase and stating: “You have again been elected a Vice President of Midland Ford Tractor Company and the writer is again appointing you as General Manager. * * * Your incentive sales compensation will continue in 1963.” Plaintiff’s employment with the defendant was terminated in November 1963 owing to differences of opinion about policy and instructions. Plaintiff admits that he received full payment of the bonus based on gross sales of 1962 and of 1963. In January 1964 he received from defendant a check for $396.25 which was designated in the accompanying memorandum as “Discretionary Bonus” of $500, reduced by the amount of the usual withholding taxes.

Thus, the position of the plaintiff is that his contract as general manager called for the payment of a bonus based on profits in 1962 and that the arrangement for that type of bonus continued for the year 1963. Plaintiff makes no claim for a profit bonus for the year 1962, because, he asserts, he was paid the profit bonus of $10,000 for that year; he would thereby show that the defendant recognized the alleged profit bonus term of the contract.

In support of the latter contention plaintiff showed that on November 30, 1962, he was paid $10,000 ; the memorandum acompanying the check did not indicate the basis upon which this payment was made. Plaintiff testified that the check was handed to him by the defendant’s president in plaintiff’s office; he recalled only that the president commented that “it was a job well done” and that he thanked the president. Defendant emphasizes that on November 30, 1962, the corporation’s net profits for the year 1962 could not then have been ascertained. As to the $10,000 payment, defendant’s president testified on direct examination:

“Q. Would you describe to the jury the occasion on which you gave this to him?
A. We gave bonuses to all employees before Christmas each year if we had profits, and Mr. Parks was given a bonus the same day the other employees of the company were.”

The court directed the jury to disregard further answers of the president relating to the manner in which the amount of the payment was arrived at. There was evidence from one side tending to show that there were net profits of $200,000 for the year, and from the other side tending to show that there were not net profits of as much as $200,000 for the year, all depending upon the analysis of the corporation’s balance sheet and its income tax return for 1962.

Appellant’s first point is that the verdict was against the overwhelming weight of the evidence. That point must be rejected. “The jury, in the first instance; is the sole judge of the credibility of the witnesses and of the weight and value of their evidence, and may believe or disbelieve the testimony of any one or all the witnesses, though such evidence be un-contradicted and unimpeached.” Cluck v. Abe, 328 Mo. 81, 40 S.W.2d 558, 559. And see J. D. Streett & Co. v. Bone, Mo., 334 S.W.2d 5, 9. Consequently the plaintiff’s assertion of this point in the motion for new trial preserved nothing for review. True enough, “the trial court in the exercise of its sound judicial discretion may set that verdict aside as against the weight of the evidence. * * * However, in the exercise of that discretion it may determine not to set the verdict aside.” J. D. Streett & Co. v. Bone, supra. Here the trial court overruled plaintiff’s motion for a new trial. “There is, perhaps, no more firmly established doctrine than that on appeal from a judgment rendered on a verdict of a jury, an appellate court is not authorized to weigh the evidence. * * * Whether a jury’s verdict is against the weight of the evidence is a question for the trial court alone.” Wilcox v. Coons, 362 Mo. 381, 241 S.W.2d 907, 917. The point is not properly before us.

In support of its denial that defendant agreed to pay plaintiff the $10,000 bonus in question defendant introduced evidence upon two principal points, 1. that no agreement to pay such a bonus was ever made by the president and 2. that defendant’s president had no authority to enter into any such arrangement on behalf of defendant. Plaintiff alleges error in the admission into evidence of the defendant’s Articles of Incorporation and its By-laws and the Statutes of Minnesota, state of defendant’s incorporation, all relating to the authority of-corporate officers.

The power of a corporate officer, like that of any other agent, to bind his corporation in contract rests either upon his actual authority or upon his apparent authority. His actual authority derives, on the one hand, from statute or from the articles and by-laws of the corporation or on the other hand from his exercise of functions on behalf of the corporation, long tacitly acquiesced in by those in legal control of the corporation, the directors. See Washington Sav. Bank v. Butchers’ and Drovers’ Bank, 107 Mo. 133, 17 S.W. 644; Fair Mercantile Co. v. Union-May-Stern Co., 359 Mo. 385, 221 S.W.2d 751 (the latter case may also be an illustration of apparent authority although reliance by a third party upon an appearance of things does not clearly appear). In contrast, apparent authority is brought into existence by the principal’s creation of an appearance of affairs which would cause a reasonable person to believe that the officer had actual authority to do a particular act, upon which appearance a third person relies.

Plaintiff pleaded that defendant, “by and through its officers, agents and representatives, entered into an oral contract” for plaintiff’s employment, under which “plaintiff would be paid a bonus of $10,000 for each year” etc. The answer denied this allegation insofar as the promise to pay the $10,000 bonus is asserted. In this state of the pleadings it was the right of the defendant to show that the president had no actual authority to make a corporate contractual promise to pay a $10,000 bonus based upon profits. To that end it introduced the evidence about which complaint is now made. Such evidence cannot be regarded as irrelevant; as- plaintiff contends. In like manner it was the right of the plaintiff to introduce pertinent evidence to show either the president’s actual authority or his apparent authority to act in the questioned respect; plaintiff introduced no evidence as to actual authority. Nor was apparent authority proved; plaintiff contented himself with assuming the president’s authority because he thought the president was “king bee”. In any event plaintiff rested under the burden of showing that the defendant corporation entered into a contract with the bonus term alleged and that in turn rested upon the authority of the president to act for the corporation in that respect.

Defendant placed in evidence a resolution of its Board of Directors, adopted February 26, 1962, resolving that plaintiff “be employed as General Manager” and stating the amount of his base salary. The resolution also provided for the bonus based on gross sales, but made no mention of any other kind of bonus. Prior to the date of this resolution there had been conferences and correspondence among and between Woods, director Hill (apparently representing the controlling interest in defendant) and company’s counsel regarding the engagement of a new general manager owing to Woods’ impending assumption of the presidency of a California-based corporation (Woods had been designated not only as president but also as general manager of the defendant). The company’s counsel was also Assistant Secretary of defendant, kept all minutes and became its trustee in dissolution. Woods discussed with counsel the terms of the agreement to be entered into with plaintiff; these terms included a bonus based on gross sales and no other type of bonus. Under date of February 5, 1962, counsel had written to Mr. Hill, a director of defendant and chairman of the Finance Committee of defendant’s parent corporation, setting up items for the agenda of the directors’ meeting of February 26, 1962. In that letter counsel stated: “At this time there will be approved the promotion of Mr. I. L. Parks with the probable title of Vice President and General Manager. His base pay will be $1450.00 per month with a $50.00 per month bonus to be paid at the end of each year for each half million dollars of gross sales over 4(4 million dollars. * * * Walter Duckstad and Ed Woods have gone over this letter with me * * No reference was made to any other form of compensation in any conference or letter.

Defendant placed in evidence also a minute of the meeting of defendant’s board of directors held on January 15, 1963, which recited: “There was then discussion of the compensation arrangement of Mr. Parks, General Manager of Midland, and on motion duly made, seconded and unanimously carried, it was agreed that his base compensation was increased to $20,000 per year. In addition, he shall have the same incentive formula as last year, namely $120.00 per year additional pay for each $100,000 of gross sales in excess of $4,-500,000.” (Our emphasis).

While plaintiff introduced no direct evidence to show that Woods had the actual authority to make the alleged promise, it is established without question that Woods was the president of the defendant at the time asserted. The question then suggests itself; What actual authority can be implied from the fact that an officer — here the president — occupied a named office and possessed a particular title? Or as the question is sometimes put: What power inheres in the very fact that one occupies the presidency?

Out of a welter of decided cases, Fletcher on Corporations (Vol. 2, Sections 559, 592) arrives at the following conclusions:

“In view of the fact that presidents of corporations are often given general supervision and control over their management the liberal and modern rule seems to be that contracts or acts made or done by the president of a corporation in the course of its ordinary business will be presumed to have been within his authority unless the contrary appears, or else it is expressly stated that the president has no such powers.
* * * * * *
* * * Even if the president be deemed to have power to act in behalf of the corporation, or there is a presumption in favor of his authority, the power does not extend to acts outside the ordinary course of business nor to acts merely for his own benefit. In other words, if the terms of a contract entered into on behalf of a corporation by its officers are extraordinary or unusual, such as are not ordinarily made by the president or other officer in the ordinary course of the transaction of the current business of the corporation, the party contracting with the officer is put upon inquiry as to his authority.”

In Sparks v. Despatch Transfer Co., 104 Mo. 531, 15 S.W. 417, at 419, 12 L.R.A. 714, the Supreme Court said:

“The president of a business corporation is its chief executive officer. He may, without any special authority from the board of directors, perform all acts of an ordinary nature, which by usage or necessity are incident to his office, and may bind the corporation by contracts in matters arising in the usual course of business.”

Later, in Fair Mercantile Co. v. Union-May-Stern Co., supra, the Supreme Court reviewed antecedent Missouri cases and repeated verbatim the above quotation from the Sparks case (at p. 753 of 221 S.W.2d). Interestingly, some of the precise language of the Sparks case was used by the New Jersey Court of Errors and Appeals in Mausert v. Christian Feigenspan, 68 N.J. Eq. 671, 679, 63 A. 610, 611.

“[The] powers [of a president] over its business and property [of a corporation] are strictly the powers of an agent, powers delegated to him by the directors, who are the managers of the corporation, and the persons in whom the control of its business and property is vested. He may, without any special authority from the board of directors, * * * bind the corporation by contracts in matters arising in the usual course of business. * * * but beyond this his official position gives him no more control over its property, funds, or business, than any other director.”

This proposition was reaffirmed and applied by the same court in Sattler v. Howe Rubber Corporation, 98 N.J.L. 460, 121 A. 523, 524.

Thus if there be inherent authority in a president resulting from the mere fact that he occupies the office, then even under what Fletcher has found to be the “liberal and modern rule” such inherent power is limited to the doing of acts — or the making of contracts, described sometimes as routine, sometimes as ordinary or usual, or — “in the course of its ordinary business” or “of an ordinary nature” or “in the usual course of business”.

It could not be maintained with any degree of plausibility that making a contract to install a third person as overall general manager of a corporation’s business was a routine transaction in the ordinary course of the corporation’s business. Such a contract was not “of an ordinary nature” and the necessity therefor did not arise “in the usual course of business.” The same must be said regarding any contract for the sharing of the corporation’s profits. The latter is so extraordinary that it must be excluded from any concept of the usual course of business. It must be held that there was no inherent power in Woods to enter into the contract here in question arising from the mere fact that Woods occupied the position of president.

Plaintiff’s verdict directing instruction was based in the conjunctive, upon defendant’s agreement to pay the $10,000 bonus based upon profits and upon the actual realization of $200,000 in profits for the year 1962. There was evidence from the two sides tending to show that there were and that there were not profits of $200,000 for the year. The verdict for defendant then leaves us uninformed as to the ground upon which the jury denied plaintiff a recovery. Perhaps the jury believed that there was no promise by Woods that the corporation would pay a profit bonus. But if that verdict was founded upon the jury’s belief that the president lacked the authority to make the questioned promise on behalf of the corporation there was substantial and uncontradicted evidence upon which to found that belief.

Obviously the plaintiff has failed to sustain the burden of persuasion in at least one of three necessary respects: the president’s promise of the $10,000 bonus or the authority of the president to make such a promise on behalf of the corporation or the extent of the corporation’s profits for 1962.

Appellant makes further complaint in his Point II that the court erred in allowing defendant’s counsel to make repeated objections and statements in the hearing of the jury which were in the form of argument in support of defendant’s case. Appellant’s brief does not indulge in specifics in support of this assignment and on the whole confines its complaint in general terms to defence counsel’s use of the terms “profit bonus, incentive bonus and discretionary bonus” in the course of the trial. Plaintiff’s opening statement made the differentiation between a bonus based on gross sales and a bonus based on net profits. Plaintiff’s direct testimony referred to a gross sales bonus and then, distinct therefrom, a bonus based on net profits. Further along in his direct testimony plaintiff denominated the $10,000 paid to him as a “profit bonus”. Upon cross-examination plaintiff was asked:

“Mr. Parks, I believe you testified that in a meeting with you and Mr. Woods in the early part of 1962, he offered to make you a general manager at a salary of approximately fifteen thousand dollars a year plus an incentive bonus based upon a hundred twenty dollars per year for each one hundred thousand dollars in excess of four and a half million dollars, and in addition thereto, a bonus of ten thousand dollars in the event that the company’s net profits before taxes equal-led or exceeded two hundred thousand dollars. Is that correct?”
Answer: “That is right.”
Q: “Was there any other time Mr. Woods made this offer to you of what we will now denominate the profit bonus?”
A: “Yes, when we talked about 1963, after ’62 was over.”

After plaintiff had injected the idea of the differentiation between two kinds of bonuses into the case by his opening statement and had repeated that idea by his own direct testimony it was quite the natural thing for the defendant, in the service of brevity, to apply differentiating labels to the two kinds of bonuses. In that portion of the testimony last quoted, the question put by counsel made it clear to the plaintiff and to the jury the sense in which counsel was using the term “incentive bonus” as well as the meaning of “profit bonus”. Thereafter, plaintiff testified:

Q. “You are not claiming that the incentive bonus based upon gross sales * * * was not paid to you, is that correct, you acknowledge that was paid?”
A. “Sure”.

Later, questioned about the notification of his 1963 compensation given him by Mr. Woods, plaintiff was asked: “You don’t recall his having said anything about your incentive bonus or profit bonus ?” Answer: “No.”

The evidence above recited was received without objection. It is clear that the use of the term “incentive bonus” in this examination of the plaintiff was not misleading and could not have been confusing.

Moreover in defendant’s opening statement the jury was well informed as to the bonus nomenclature which defendant was using; counsel was quite explicit in differentiating incentive bonus from profit bonus and invariably linked “incentive bonus” with gross sales. The meaning of “profit bonus” as used by defendant was made equally clear. In this opening statement the jury was fully informed that it was defendant’s contention that the $10,000 payment was a “discretionary bonus”. Defendant’s witness testified that that payment was a discretionary bonus.

In all this we find no basis for plaintiff’s charge that defendant’s use of the terms— incentive bonus, profit bonus and discretionary bonus—was “obviously calculated to confuse the jury concerning the Plaintiff’s right to the bonus as pleaded by interjecting into the case different types of bonus.”

Appellant’s last point relates to the exclusion of testimony on cross-examination of defendant’s president. His offer of proof: That the president’s minor son sold two bulls to the defendant corporation for approximately twelve hundred dollars and that the bulls proved worthless and that they were sold in the same year at only a fraction of their cost; that the plaintiff objected violently to that deal; that the president used his position to build buildings on an experimental farm owned by him and leased to defendant corporation.

The appellant maintains that the proffered evidence was proof of the bias and prejudice of Woods toward appellant, was therefore related to the question of Woods’ credibility and hence was admissible.

Appellant attempts first to bring the evidence offered within the surrounding circumstances rule enunciated in Gibbons v. Chomeau & Engelland, Inc., 240 Mo.App. 41, 210 S.W.2d 715. The purchase of the bulls and the improvement of the farm cannot be regarded as surrounding circumstances; the issue here was the content of the agreement entered into by appellant and Woods and the matters offered in evidence had no relation to the events leading up to the agreement reached in early 1962. That evidence was not contemporary with the making of the agreement, nor even closely related in time, furnished no background or color for it and explained no part of it. The rule for which appellant contends is simply the res gestae rule and we know of no basis for asserting that the offered evidence was any part of the res gestae.

The interest of the witness Woods was made amply apparent throughout the trial of the case, both by plaintiff’s testimony and by Woods’ direct examination. It was an interest of which the jury could not have been unaware. Woods was the only other participant in the conference leading to the agreement which plaintiff alleged and had already contradicted plaintiff’s testimony on the only matter in issue. In addition, the relationship of Woods to the persons who controlled both the defendant corporation and the corporation of which Woods is now the president was well demonstrated. All this was quite sufficient to inform the jury of bias on Woods’ part. There was nothing that made it useful to cumulate evidence of that bias in order to protect plaintiff’s position in the contemplation of the jury. The addition of any other evidence for that purpose would be only an act of supererogation. For that reason and other reasons hereinafter stated, there was no abuse of discretion bn the" part of the trial court in excluding the evidence offered.

In Kells v. Pevely Dairy Company, Mo.App., 393 S.W.2d 61, 65, this Court cited as its authority the Supreme Court case of Eickmann v. St. Louis Public Service Company, Mo., 323 S.W.2d 802, where the court stated at page 807: “The law is well settled that the extent and scope of cross-examination in a civil action is discretionary with the trial court and its rulings in regard thereto will not be disturbed unless an abuse of discretion is clearly shown.” This Court then proceeded to apply that stated principle to the trial court’s action in overruling the cross-examiner’s attempt to examine a witness as to collateral matters for the purpose of attacking his credibility and found no abuse of discretion. The rule of discretion as to cross-examination upon collateral matters for purposes of impeachment is found enunciated in many other Supreme Court cases, including Bond v. Wabash Railroad Company, Mo., 363 S.W.2d 1, 6; State v. Cox, Mo., 352 S.W.2d 665, 673; Willis v. Wabash Railroad Company, Mo., 284 S.W.2d 503, 512; Arnold v. Alton R. Co., 348 Mo. 516, 521, 154 S.W.2d 58, 60. And see Wilcox v. Coons, 362 Mo. 381, 241 S.W.2d 907; Adriance v. Arnot, 31 Mo. 471.

To have admitted the proffered evidence would have resulted, in effect, in the trial of two cases. The introduction of that evidence would have caused the introduction of rebutting or explanatory evidence on the part of defendant. The circumstances of the purchase of the bulls would have been explored in detail; perhaps their procreative capabilities would have been investigated. The terms of the lease of the Woods farm and the type and cost of the buildings erected thereon would have become pertinent. All this would have been a far cry from the issue of the plaintiff’s compensation. It would have distracted and diverted the jury and might have been highly entertaining. But it would have focused attention upon an extraneous affair and given inordinate emphasis to a subject extrinsic to the matter of plaintiff’s compensation. It was not an abuse of discretion to obviate such a result by the exclusion of the evidence offered.

The judgment should be affirmed.

PER CURIAM:

The foregoing opinion by TOWNSEND, C., is adopted as the opinion of this Court. Accordingly, judgment is affirmed.

ANDERSON, P. J., and RUDDY, J., concur.

      . Minus federal and state -withholding taxes.

      . The relevant portion of the Minnesota statute provides: “All officers shall, respectively, have such authority and perform such duties in the management of the business of the corporation as may be prescribed in the by-laws, or, in the absence of controlling provisions in the by-laws, as may be determined by the board of directors.” The by-laws recite that “the president shall be chief executive officer. * * * He shall have general charge; supervision and control of the business and affairs of the corporation, subject, however, to the control of the board of directors.” The articles simply show that the defendant was incorporated under the Minnesota statute.

      . “The president of a business corporation has no power as such to constitute a general business manager without the consent of the directors.” Vogel v. St. Louis Museum, Opera & Fine-Art Gallery, 8 Mo.App. 587.

      . A less liberal rule states that “the office of president of a private corporation of itself confers no power on the incumbent to bind the corporation or control its property.” Wainright v. P. H. & F. M. Roots Co., 176 Ind. 682, 97 N.E. 8.


text:
    Glenn TAYLOR, Employee-Respondent, v. BI-STATE DEVELOPMENT AGENCY, Employer-Appellant, and Transit Casualty Co., Insurer-Appellant.
    No. 32605.
    St. Louis Court of Appeals. Missouri.
    May 16, 1967.
    Motion for Rehearing or for Transfer to Supreme Court Denied June 14, 1967.
    Application to Transfer Denied Sept. 11, 1967.

      John A. Walsh, Jr., Gerald D. Morris, St. Louis, for employer-appellant and insurer-appellant.
    Garnet W. Taylor, St. Louis, for employee-respondent.
   WOLFE, Judge.

This is an appeal from a judgment of the Circuit Court affirming an award of the Industrial Commission of Missouri. A Referee of the Division of Workmen’s Compensation made an award to the claimant employee. The employer appealed to the Commission which affirmed the award of the Referee and made additional findings of fact. The employer then appealed to the Circuit Court where the award was affirmed, and this appeal followed.

At the outset of the hearing before the Referee it was established that the Bi-State Development Agency was under the Workmen’s Compensation Law and that its liability under the law was fully insured by the Transit Casualty Company. It was also established that the claimant employee was employed by the Bi-State Development Agency at an average weekly wage that exceeded $100.00.

The claim, which was timely filed, alleged “The claimant had just finished his work as an operator of a bus, which was his occupation, and was in the recreation room provided for employees, at 3901 Park Ave. and was standing there watching the employees shoot pool. Another employee came up and shoved claimant, catching claimant off balance and he fell to the floor striking the lower part of his back against a radiator valve.” He alleged that the accident caused injury to the lower back and spine.

There is but one point raised by the appellant and that is that the Circuit Court erred in affirming the award of the Commission because the evidence does not support the conclusion of the Commission that the injury arose out of and in the course of claimant’s employment. The following facts are the facts disclosed by the record as those facts relate to the point raised.

On February 11, 1964, the claimant worked as a bus operator. His work for the day ended at 11:19 A.M. At that time another operator took over the bus that claimant had been driving and claimant then went by bus from the relief point to the Park Avenue garage to turn in his receipts. At the garage on Park Avenue in the assembly room he turned in his day’s receipts. This was concluded at 12:10 P.M.

Adjoining the assembly room there was a recreation room. This room had two pool tables in it, a television, a radio and candy, cigarette and soda vending machines. The employees had purchased one of the pool tables but the room was maintained by the Bi-State Transit Company and was under their control. It was used as a recreation room for operators waiting to go out on runs or for those who worked on split shifts who wished to spend their time between shifts there. The operators were allowed to use the room at any time up to 8:00 P.M. when the lights were turned off.

After the claimant had turned in his day’s receipts his work was finished and he was free to go home. He went instead into the recreation room and played pool. No one asked him to remain there, he just wanted to play pool and relax. He was not subject to any further service that day. There were occasions when emergencies arose when regular operators were called upon. If there were men available in the recreation room they would call them there. He had worked as an operator for Bi-State and its predecessors since 1940 and had been called during that period of time to make emergency runs five or ten times. If called he was not obliged to take such call but he said that he would have done so. Normally the men on the extra board were the ones who were called and claimant did not know if there were any- men on the extra board that day. The operator who caused claimant’s injury testified that he thought they were all out of extra men at the time.

Claimant played one game of pool and was standing by the pool table when another operator gave him a playful nudge that caught him off balance. This caused him to fall and strike his back against the steam valve on a radiator with the resulting injuries for which he seeks compensation.

The Commission found upon the foregoing facts “ * * * that -the maintenance of the recreation room was an incident of the employment and that it resulted in a substantial benefit to both the employer and employee. * .* * ” They concluded for the reason stated that the employee should be compensated for the injury he received.

The scope of our review of the finding and award of the Commission is fixed by Article 5, § 22, 1945 Constitution of Missouri, V.A.M.S., which states that in passing upon the decisions and findings of administrative agencies “ * * * such review shall include the determination whether the same are authorized by law, and in cases in which a hearing is required by law, whether the same are supported by competent and substantial evidence upon the whole record.” The extent of appellate review of such cases has been stated and restated many times, but for those interested in re-reading it, we cite again Wood v. Wagner Electric Corporation, 355 Mo. 670, 197 S.W.2d 647; Francis v. Sam Miller Motors, Mo., 282 S.W.2d 5; Davidson v. Scullin Steel Company, Mo.App., 408 S.W.2d 171.

The Commission rested its award primarily upon three cases which it considered applicable to the facts. They are Conklin v. Kansas City Public Service Co., 226 Mo.App. 309, 41 S.W.2d 608; Wamhoff v. Wagner Electric Corporation, 354 Mo. 711, 190 S.W.2d 915, 161 A.L.R. 1454; Gillmore v. Ring Const. Co., 227 Mo.App. 1217, 61 S.W.2d 764.

The case of Conklin v. Kansas City Public Service Co. involved an employee who was injured while watching a game of baseball. Such games were regularly played during the lunch period in a building on the employer’s premises called the “paint shop.” The employees of several departments each had a team and they were encouraged to play or to watch the game. The lunch period was from 12 to 12:30 and while an employee was free to leave for lunch many did not and it was a convenience for both the employer and the employee to have a place of exercise provided during their short wait to return to work. Upon this theory the Kansas City Court of Appeals held that the employee spectator injured by a thrown bat should be paid compensation. The case here considered differs in that the mishap which here caused the injury did not occur during a break in the work day, but after the work day was finished and claimant was enjoying a game of pool prior to going home.

Gillmore v. Ring Const. Co., 227 Mo.App. 1217, 61 S.W.2d 764, supra, concerns claimant who, with others, was standing around a fire on a construction job. The weather was bad and the workers had been told to wait to see if there would be sufficient change in the weather to permit them to work. While so waiting on the orders of the foreman the claimant suffered a broken leg by reason of “some horseplay” among those waiting. The court there quite properly held that the accident arose out of and in the course of claimant’s employment. They had been told to wait. This differs materially from the case before us for the claimant here was not told to wait for any purpose.

The other case mentioned above was the case of Wamhoff v. Wagner Electric Corporation, 354 Mo. 711, 190 S.W.2d 915, 161 A.L.R. 1454. The injured claimant was engaged in the electroplating department of the employer. He was injured while buffing a small toy belonging to his daughter. He had plated the toy and the work was not for the employer. There was evidence that the employer encouraged the electroplaters to engage in work of their own, when they had no company work to do, in order to develop skills in plating different kinds of metal. It was held that the Commission could properly have found that the work, in which he was engaged at the time, had become an incident of the employment and was therefore a compensa-ble injury. Applying that rule to the facts of this case would be difficult, for here there is no evidence that it was incidental to the plaintiff’s employment, that he should wait around for an emergency call, for they were very rare. There is evidence that had such a call been made while he was there he would have volunteered to go out on it but by his own testimony he was not waiting for such a call but was engaged in some after work relaxation prior to going home for the day.

In addition to the cases we have above distinguished, the claimant cites us to Jones v. Bendix Corporation, Mo.App., 407 S.W.2d 650; Gregory v. Lewis Sales Company, Mo.App., 348 S.W.2d 743; and Lampkin v. Harzfeld’s, Mo., 407 S.W.2d 894. These are also readily distinguishable from the case here considered. The accident for which recovery was sought in those cases occurred when each of the claimants was doing something incidental to the employment. As stated in Lampkin v. Harzfeld’s, supra, the Missouri Supreme Court said at 1. c. 897: “[3-6] An injury arises ‘out of’ the employment when there is a causal connection between the conditions under which the work is to be performed and the resulting injury, and it arises ‘in the course of’ the employment when it occurs within the period of the employment at a place where the employee may reasonably be and while he is reasonably fulfilling the duties of his employment or engaged in doing something incidental thereto.”

We find no evidence to support the conclusion that the accident occurred during the course of claimant’s employment. The evidence also fails to support any conclusion that he was engaged in a duty of his employment or an activity incidental to it.

For the reasons stated the judgment affirming the award of the Commission is reversed and the cause is remanded to the circuit court with directions to enter a judgment reversing the award of the Commission.

ANDERSON, P. J., and RUDDY, J., concur.