Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Hayes v. Preferred Risk Mutual Ins. Co.

OPINION FILED NOVEMBER 16, 1978.

WILLIAM C. HAYES, SR., PLAINTIFF-APPELLANT,

v.

PREFERRED RISK MUTUAL INSURANCE COMPANY, DEFENDANT-APPELLEE.



APPEAL from the Circuit Court of St. Clair County; the Hon. JOHN HOBAN, Judge, presiding.

MR. JUSTICE KARNS DELIVERED THE OPINION OF THE COURT:

Plaintiff, William C. Hayes, Sr., appeals from the judgment of the Circuit Court of St. Clair County entered on a jury verdict in favor of the defendant, Preferred Risk Mutual Insurance Company. He alleges that he suffered damages as a result of Preferred's termination of his insurance agency.

The resolution of this controversy depends on the construction of a written agency agreement entered into by the parties in February of 1956. The relevant portions of the contract reveal the following:

(1) Either party could terminate the agreement at will;

(2) In the event of termination the agent had a right to future commissions recognized as a "limited property right," and the agent had the right to sell or transfer this interest to another;

(3) If the agent were unable to procure a purchaser or effect a transfer, the Company could, at its option, purchase the "limited property right" on the basis of "one-times the renewal commissions" payable on policies written during the previous year and in effect at the time of cancellation.

On April 1, 1971, Hayes received a letter from Preferred notifying him that effective May 31, 1971, his agency contract would be canceled.

In mid-April, Hayes' customers began receiving letters from Preferred entitled "Notice of Policy Expiration." The customers were informed that Hayes no longer represented Preferred and that their policies would expire at the end of their respective terms. The letter encouraged the customers to contact Hayes so that he could continue to be their agent and place their insurance with another company. The letter also provided an opportunity for the customers to remain with Preferred if they so desired; approximately one-half of the customers did renew with Preferred.

During this time, Hayes made no attempt to sell or transfer his "limited property right."

After the agency was terminated, Hayes filed suit alleging that Preferred terminated the agency in order to acquire plaintiff's commissions and that said cancellation was arbitrary, without just cause and in bad faith.

The trial court directed a verdict in favor of defendant and plaintiff appealed. This court reversed and remanded with directions in Hayes v. Preferred Risk Mutual Insurance Co., 28 Ill. App.3d 443, 328 N.E.2d 709 (5th Dist. 1975).

Construing the agency contract, we held that "[t]he contract itself, apart from any duty of the parties to act in good faith, embodies a promise by the company to allow Hayes a reasonable opportunity to find a buyer for his `limited property right.'" (Hayes, 28 Ill. App.3d 443, 448, 328 N.E.2d 709, 712.) We further held that whether the two months between April 1 and May 31 was a reasonable time in which to sell the "limited property right" was a question for the jury and that if the company decided to appropriate for itself the benefit of that "limited property right," it would have to pay the amount determined by formula in the contract.

On retrial, plaintiff amended his complaint alleging that defendant cancelled the agency to acquire his commissions and that defendant failed to provide him with a reasonable opportunity to sell his "limited property right."

After opening statements, plaintiff moved the court in limine for a protective order barring defendant from showing Hayes' earnings (other than from Preferred clients) in the year following the termination. The court reserved ruling on the motion but later permitted Preferred ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.