Davis v. Fidelity Fire Insurance
70 N.E. 359
Ill.
1904
Check Treatment
Mr. Chief Justice Hand

delivered the opinion of the court:

From the view we take of this case it will be necessary to consider but one question,—-that is, was the firm of Davis & Shepherd appointed western agents for the Fidelity Fire Insurance Company for the period of five years, or was their appointment for an indefinite period of time and subject to termination by the insurance company upon its discontinuing its western agency. From a consideration of all the evidence in the record we think it clear that the agreement between the insurance company and Davis & Shepherd must be found in the letter of appointment bearing date May 7, 1900, and that all the conversations and correspondence between the parties leading up to that letter, and the acceptance of its terms by Davis & Shepherd, were in the nature of negotiations, and became merged in said letter of appointment when accepted.

The law is well settled that when parties reduce to writing their agreement as finally agreed upon by them, all prior negotiations leading up to the execution of thе writing are merged in the writing, and that parol evidence ‍​​​​​‌‌‌‌‌​‌‌​‌‌‌​‌‌‌​​‌‌‌‌​‌‌​​‌‌​‌​‌‌​​‌​​​‌​​‍is not admissible to explain, contradict, enlarge or modify the writing as it exists when executed. The writing, when executed, "becomes the repository of the agrеement between the parties. In Memory v. Niepert, 131 Ill. 623, on page 630, it is said: “Where parties have deliberately put their contract into writing', the rule doubtless is that the writing is the exclusive evidence of what the contrаct is.” And in Clark v. Mallory, 185 Ill. 227 (p. 232): “While courts will uniformly endeavor to ascertain the"' intentions of the parties' in construing a contract between them, and for that purpose will look into the surrounding circumstances at the timе the contract was executed if the language of the instrument is ambiguous or its meaning uncertain, still, when the language employed is unequivocal, although the parties may have failed to express their real intеntion, there being no room for construction, the legal effect of the instrument will be enforced as written. Intention of the parties is not to be determined from previous understandings !or agreements, but must be ascertained from the instrument itself which they execute as their final agreement, otherwise written evidence of an agreement would amount to nothing.”

In the conversation in Chicago on March 22 between Courtney and the mеmbers of the firm, in the letter of March 24 written by the firm to Courtney, and in the conversation in April between John Shepherd and Courtney in Baltimore, it is doubtless true that Davis & Shepherd were seeking to obtain an appointment fоr five years. This part of their proposition, however, does not appear to have been acceded to by the insurance company, and in the draft of the letter of appointment of May 7, as first sent to Davis & Shepherd, the duration of the time of their appointment was left indefinite. They were asked to examine the letter and to note such changes therein as they desired to have made. After аn ‍​​​​​‌‌‌‌‌​‌‌​‌‌‌​‌‌‌​​‌‌‌‌​‌‌​​‌‌​‌​‌‌​​‌​​​‌​​‍examination of the letter, which must have included an examination of the paragraph designated “Duration of your appointment,” as it occupies a prominent position in the letter, Davis & Shephеrd suggested a number of changes in the letter, none of which affected in any manner that part of the letter which fixed the duration of the time of their appointment, and the letter of appointment, upon thе receipt of their suggestions, was re-written by the company in accordance with their suggestions, but no change was made in the duration of the time of their appointment. The letter, as re-written, was returned to them, and they accepted its terms, and their appointment thereunder, in writing. The propositioh of Davis & Shepherd that they be given an appointment for five years, contained in the conversation had on thе 22d of March, repeated in their letter of March 24 and referred to by John Shepherd when in Baltimore, was not accepted by the insurance company, but what, in effect, was a counter-propositiоn upon that subject was submitted by the company in the draft of the letter of May 7, which was sent to Davis & Shepherd for their examination and which thejr afterwards accepted in writing. In Maclay v. Harvey, 90 Ill. 525, it was held a letter writtеn in reply to an offer, which re-states the terms of the offer but with some variations, though slight, can not be regarded as the consummation of a contract and requires an acceptance upon the terms thus stated, and until unequivocally accepted is only a mere proposition or offer. And in Anglo-American Provision Co. v. Prentiss, 157 Ill. 506, on page 513 it is said: “It is undoubtedly the rule that where one party makes a proposition to another, an assent, to be valid so as to conclude an agreement or contract between the parties, must ‍​​​​​‌‌‌‌‌​‌‌​‌‌‌​‌‌‌​​‌‌‌‌​‌‌​​‌‌​‌​‌‌​​‌​​​‌​​‍in every respect meet and correspond with the offer, neither falling short of nоr going beyond the terms proposed, but exactly meeting them at all points and closing with them just as they stand.”

We have no doubt the parties fully expected that the western agency of the insurance compаny and the business relation established between.them would continue for some time,—perhaps for a period of years. Still, the time the western agency and the business relation between the parties were tо continue was left indefinite by the agreement, and the insurance company was not bound to continue its western agency, and neither party, by the terms of the agreement, could require the other to continuе the relation thereby established between them longer than such relation was agreeable to both.

In Orr v. Ward, 73 Ill. 318, the contract sued on was an employment contract, in writing, for a salary and commission, which provided for the payment to the employee of $2100 for the year 1873 and $2400 for the year 1874, in semi-monthly or monthly installments, and a commission on all sales in excess of $35,000. The appellee commenced work thereundеr in January, 1873, and continued until June 11 of the same year, when the firm which had engaged him became insolvent and he was discharged. Suit was brought to recover damages for not continuing appellee in the service оf the firm. The. court, on page 319, said: “We are to judge of the contract by what it contains. Having reduced it to writing, we must presume the parties have embodied in it their entire agreement. It contains no stipulation the firm will retain appellee for two years or any other fixed period. Their undertaking is to pay him at a certain rate of compensation if he shall discharge the duties assumed by him to be performed. No doubt it is true each party contracted on the supposition the business would continue through the space of two years, but appellant’s firm did not obligate themselves to continue it for that length of time. As a mattеr of fact, it terminated much sooner. We have no authority to add to the contract as the parties have made it, enlarging the liability of either one of them, and have no disposition to do so.”

If the duratiоn paragraph be abbreviated by eliminating adjective and dependent phrases, it would then read as follows: “Our aim is to establish a permanent insurance business on a solid basis and under conservative management, such as has been mutually discussed and agreed upon;” and if it be admitted that this amounted to an agreement that the western agency should be permanently continued and for a permanent .appоintment, we think it still might be terminated at the will of either party. In Lord v. Goldberg, 81 Cal. 596, (15 Am. St. Rep. 82,) the plaintiff testified that he said, “While it is a very good increase in salary, will it be permanent?” to which the defendant answered, “It will; it will last; it will be permanent.” It was held the hiring was for an indefinite period. And in Gray v. Wulff, 68 Ill. App. 376, in a suit for a wrongful discharge, it was shown that the plaintiff, a musician, had written the defendant previous to the employment, saying, “I would prefer your house if you can guarantee а long engagement,” and that'the defendant had replied, “Be here Thursday evening.” It was held that the term “long engagement” has no certain meaning, and that ‍​​​​​‌‌‌‌‌​‌‌​‌‌‌​‌‌‌​​‌‌‌‌​‌‌​​‌‌​‌​‌‌​​‌​​​‌​​‍there was no employment for a definite time, and that the dеfendant had the right to discharge the plaintiff on giving him the customary notice. In Beck v. Walkers, 24 Pa. Cir. Ct. 403, it was said: “Though by the contract the employment is made expressly a permanent employment, the law still holds that the term is indefinite.” And in Milner & Co. v. Hill, 19 Ohio Cir. Ct. 663, an employment contract was made by the appellee writing to appellants, after some.previous correspond-

ence: “Would you be kind enough to inform me what salary you will pay if only for the season, and what you will pay if for an annual or permanent position? And also please state whether the position soon to be vacant in your ingrain department is for the seasоn or permanent.”" Appellants answered: “In reply would say that the position in our ingrain department will be a permanent one. * * * Come at once.” After a breach alleged, the court say: “Either party might terminate the contract at any time. * * * It is simply a statement that he has entered into a business that is permanent rather than a temporary business, and it refers to the position itself, rather than to his employment for the position.”

It is urged by appellants that the letter of appointment does not fully set forth the agreement between the parties, and therefore the case of Orr v. Ward, supra, and the other cases to the same effect cited by the appellee in its brief, do not apply to this case for that reason. We are of the opinion the letter of appointment does set forth the agreement bеtween the parties, and that its terms are plain and unambiguous. While the agreement does not state the duration of the time of the appointment of Davis & Shepherd, but leaves the time of their appointment indefinite, that does not, in a legal sense, make the agreement uncertain or ambiguous. To admit parol evidence that the appointment was for a period of five years- by reason of the fact that the time of their appointment is indefinite, would be to import into the agreement a provision which the parties deliberately omitted therefrom. In other words, to admit such testimony would be to make a new contract, for the parties. This the court is powerless to do. Vail v. Northwestern Mutual Life Ins. Co. 192 Ill. 567.

Finding no reversible error in this record the judgment ‍​​​​​‌‌‌‌‌​‌‌​‌‌‌​‌‌‌​​‌‌‌‌​‌‌​​‌‌​‌​‌‌​​‌​​​‌​​‍of the Appellate Court will be affirmed.

Judgment affirmed.