Fluharty v. Midland National Life Insurance Co.
275 N.W.2d 347
S.D.
1979
Check Treatment

*1 FLUHARTY, Plaintiff Appellant, LIFE INSUR- NATIONAL MIDLAND COMPANY, Defendant

ANCE Respondent. 12371.

No. Dakota. Court of South Nov.

Argued 15, 1979.

Decided Feb. Johnson,

Charles Rick Johnson of John- Eklund, Aho, Gregory, son & Ronald C. Brookings, plaintiff appellant. Austin, Alan L. Austin of Hinderaker & Hackett, Watertown, re- for defendant and spondent.

ANDERST, Judge. Circuit appeal This is an from the trial court’s entering judgment notwith- $27,936.00,the full standing the verdict for claim, respondent’s after the amount of returned a verdict in the amount $13,918.00. We affirm with directions. *2 Fluharty receiving last Appellant, (Fluharty), 26,1974. his loan check March Steinberg (Steinberg), M. Ted a met one Midland, by 13, letter of 1974, November agent for National Life general Estates, Agri Inc., advised copies with (Midland), in Company Insurance Steinberg and Fluharty, that its total in- a Steinberg prepared family estate when debtedness amounted to over By 1971, August, Thereafter plan for him. 24, 1975, letter January dated Midland de- Fluharty Steinberg went to work for payment manded of the then balance due of an for Midland. Later in Agency as $39,901.85. 1972, Midland, with Steinberg’s September, Steinberg and Fluharty, individually and consent, Fluharty a district agent, made Estates, Inc., d/b/a Agri initiated action Fluharty’s commissions which increased against 25, agent. During July he received as an Midland on over those 1975. The time, Steinberg and Flu- period both same date Midland commenced three- from harty received cash loans Midland in against count action Steinberg and Fluhar- regular the form of checks at intervals. ty: against Count I Steinberg individually; expressly bore an endorsement checks Count II against Fluharty individually; and stating the amount of check was a Count III against Steinberg and Fluharty on loan demand. The jointly. Upon motion, the court consolidat- past amount of these loans was based on actions, ed the treating complaint by anticipated and future production commis- Midland as a counterclaim sions with which Midland credited their brought by Steinberg Fluharty. and In they as were earned. Also accounts April, 1976, Steinberg Fluharty and re- against charged their accounts were social tained different counsel. The matter was premi- insurance security payments, group September 3, scheduled for trial on 1976. ums, per- medical examination fees of and Steinberg Neither Fluharty nor or their insurance, purchasing sons not appeared counsel on the date trial. Af- paid by Midland. ter attempts to reach telephone counsel suggestion At the was de- unsuccessful, proceeded the court that it in the best termined would be inter- hear the matter and entered a default judg- parties Steinberg ests of if the Agency all ment against in favor of Midland and Stein- Fluharty reorganized princi- was to make berg, Fluharty Estates, Agri and Inc. No- pal. accomplished February, was This tice of entry judgment was served on Steinberg Fluharty when and formed counsel, proceeded and Midland to execute Estates, Inc., corporation. de facto Agri thereon. reorganization, par- To effectuate Agri ties executed documents wherein Es- Fluharty counsel, retained different who tates, general agent; Inc. became a Stein- Steinberg’s attorney prevailed upon berg Fluharty agents; district became re-open the court to for matter trial to assigned Steinberg Fluharty past all a jury upon the merits. Present counsel Agri Estates, commissions to and future Fluharty July, retained Inc.; Agri Inc. assumed all the jury trial on merits was scheduled for obligations Steinberg gener- debts September agent; Fluharty al and Stein- day commence, counsel berg Fluharty individually assumed for personal Steinberg moved for liability for all the debts and obli- a continuance on gations any ground nature whatsoever of. Steinberg was afraid of Estates, Inc. Midland continued to make Fluharty and feared for his life. This mo- regular loans in form of checks inter- tion, opposed by both Fluharty and Mid- Steinberg Fluharty. vals to land, was denied the court. Counsel for Steinberg then left the courthouse and Agri Estates, production began Inc.’s further fall, participation by received his last him loan 27, 1973, with Steinberg check November in the proceedings. Tomlinson, er v. then moved to N.W.2d 618 Counsel of which reviewing the effect The standard in pleadings, judg amend have had ment Fluharty may n. o. v. is that appellate claim dismissed light Midland’s claim views and denied the evidence in most against Midland favorable proceeded against Midland then whom him. the motion was against directed, designated counterclaim. In- and without prove up weighing the evi *3 dence, decides if there is evidence were all loan evidence which into troduced would Steinberg supported support to have or had made and did a ver Midland checks Kocer, dict accounting Corey Mid- in his favor. v. Fluharty. purposes, For 86 S.D. Fluharty, (1972). 193 N.W.2d 589 kept separate account for land Estates, Computer Inc. Agri Steinberg and Appellant’s main contention is that showing the loan checks and other printouts checks Steinberg sent to him and were ad- separate to by Midland each charges made not general vances and loans. The rule is for with credits received together account Am.Jur.2d, set Agency, out in § into earned were introduced commissions it is wherein stated: trial, prior to Just evidence. money by or given prin- Whether not from Watertown to its main office moved cipal given as an advance and to be printouts years for the Falls. Sioux repaid in by the event that his misplaced. and 1972 or compensation commission other does Steinberg’s had furnished copies been not amount to the sum advanced de- original Fluharty’s counsel Midland. and pendent upon interpretation showed a presented by Midland Evidence Generally, contract between them. owing to it for the due and balance total of employment pro- where the contract $27,836. in the amount of accounts three drawing vides for a account advances showed that evidence further Midland’s commissions, agent against future sent printouts had been of these copies cannot, employer in the absence Estates, Inc.’s Agri regular intervals express implied agreement either an close of all evi- At the address. business promise repay any excess advances the court dence, for moved counsel Midland earned, over the commissions recover favor, which was its verdict in to direct If, employee from the such excess. how- general ver- returned denied. ever, contains in contract terms against Steinberg of Midland in favor dict promise repay the sums doing and busi- individually Fluharty and advanced, the principal may recover the Estates, Inc. the sum of Agri ness over the excess of advances commis- sions . Midland, the of counsel for Upon motion Appellant admitted he endorsed judgment notwith- then entered a court printed en- checks he received $27,836 standing verdict in the sum stating the check constituted a dorsement Fluharty individually Steinberg and against He loan on demand. Agri Fluharty Es- Steinberg and d/b/a also he executed all the docu- admitted only from that tates, appeal is Inc. The Further, creating Estates, Agri ments Inc. Fluharty indi- judgment against part executing the documents be- he admitted vidually. individually tween himself well as in behalf of Inc. judgment notwith for A motion court was correct in effect Midland. trial retroactive standing the verdict is evidence, ruling, in view of this is based to and relates back Steinberg paid checks verdict. Barn for motion previous loans not advances. The 186, 110 Ahlers, 79 N.W.2d hart ruling correct its of law was also rules appeal, On correct agreed that Midland than the law set rather applied must insurance, charge group them for Frag could in the instructions forth persons pur- not court in judgment v., medical examinations n. o. but insurance, chasing security. and social remand with directions that the trial court correct the accounting. judgment the trial was in effect error in the total Thus inserting $32,690.87 the correct amount of dispute not that he or Appellant did for the appearing. amount now Steinberg had received the loan checks. present any he evidence that Neither did WOLLMAN, J., MORGAN, J., C. full give them credit for Midland did concur. Appellant’s premise earned. commissions HENDERSON, J., to produce Midland’s failure concurs specially. was that computer for 1971 and 1972 ren printouts J., FOSHEIM, deeming disquali- himself suspect. As accounting we stated dered fied, participate did not in this opinion. Bank, Jerke v. Belmont State 54 S.D. ANDERST, Judge, sitting Circuit 446, 467, (1929): 223 N.W. *4 DUNN, J., disqualified. judgment rule of reasonable must [T]he case applied upon particular each HENDERSON, (concurring spe- Justice

facts, and, testimony if of the behalf cially). having the party proof burden I specially wish to concur but with some full, or extraordinary clear and not in- elaboration. light general experi- credible in This hinges entire ease on whether Flu- ence, contradicted, directly and not either harty’s incoming checks from Midland were indirectly, other by by witnesses “loans” “advances”. disclosed, plain and is so circumstances complete that disbelief therein could The checks bore endorsements of Fluhar- by processes applied ty not arise rational they were subject “loans” to repay- evidence, but would be whimsical or ment on demand. then, case, arbitrary, such it not The endorsements on the checks only but permissible, highly proper, follows: “This endorsement my constitutes . verdict direct a acknowledgement of receipt of the amount evidence, otherwise, documentary or No of this check from Midland National Life challenging accuracy was introduced Company Watertown, Insurance South presented by figures Dakota, loan, Midland. Reason- as a on demand, could have able minds not differed over the charged said amount my to be amount owed for there was no account as acknowledged indebtedness jury rationally which could Company.” basis at in an have arrived a verdict amount These impaled endorsements Fluharty on by evi- other than established Midland’s the altar of debt. dence. The verdict of jury in this case was When the facts and circumstances one-half, exactly to the penny, of case, particular it in a have warranted by amount sued for Midland on its counter- to approve court has never hesitated $27,836. claim. The amount sued for was having direction of verdict for a The verdict returned was for This proof. conclude that the trial burden We was obviously compromise verdict. entering judgment court was correct in not It always mystery how jury withstanding the verdict. arrives a verdict. appears It was to the attention of me brought compromise verdict was arbi- argument the court at oral that the clerk of trarily My assumption rendered. is based error on computation courts had made an It is record. a rare bird in jury judgment taxing the total when costs. trial when a defendant and lawyer his are Written consent to correct error was not in the during courtroom the course of defendant, We made Midland. affirm the trial trial. The Steinberg, and tered, is found in National in the courtroom. Bank of Com- appeared never lawyer Bottolfson, merce v. both sued. Steinberg were N.W. particu- Ted A.L.R. 892 In that “M. Stein- sued as follows: They case, lar individually, testimony affirmative Fluharty, Larry G. berg, unpaid as to the on amount a note and Fluharty, Steinberg and M. Ted showing there was no otherwise. In this jury The Inc.”. d/b/a case, particular Fluharty did forms, plead, nor one stated two verdict submitted prove, payment. accepted the other PLAINTIFF FOR VERDICT accounting to the penny, of Midland for the DEFENDANT. VERDICT FOR stated exactly verdict was one-half of what the signed the VERDICT FOR foreman accounting showed. DEFENDANT, as follows: which stated in the Jury duly empanelled above- “We the assignment of error and try and sworn to issues entitled brief, way of urges the lower court’s and assess defend- the defendant find for ruling nothing more than an unconsti- $13,918.” I am damages at the sum of ant’s tutional of its opinion substitution for the jury awarded one- that the opinion of the jury’s opinion a fact question. about He the basis that damages upon half of VI, cites Article Section South and no only pay one-half Fluharty should Dakota State Constitution and the Seventh supported by was not verdict This more. Amendment to the States Constitu- nonpres- or instructions. evidence tion. Steinberg, my opinion, confused enee of argument begs This the issue of whether *5 However, point to out in I hasten not a make court can determinations of judge the trial 9 and 11 instructions during of the law the course trial that takes jury to apparent made it away the ultimate determination of the being parties sued as to jury particularly jury where a has ren- doing busi- individually both the action dered a verdict. Inc. ness as Our Judg- state statute on motions proven up loan checks had been After the ment Notwithstanding the Verdict is found Steinberg’s and establishing case this 15-6-50(b). 50(b) at SDCL It is identical to liability, Flu- joint and several Fluharty’s of Federal Rules Civil Procedure. any offsets proving burden of harty had the 50(b) to Technically, Rule allows a any of sub- evidence payments for a verdict. renew motion directed Fluharty’s part to offered on stance Federal Rule 50 was amended in 1963 so to these loan respect issues with raise the rule caption speaks that the now of the evidence of checks, controvert or to “Judgment Notwithstanding the Verdict”. due was that the balance 1963, to federal not used Prior rules had I hold that lower Accordingly, would that term. Judgment right granting court was constitutionality of Rule 50 is Federal Notwithstanding the Verdict. Thus, thoroughly settled. the decisions interesting case on this and recent an For respect applicable with thereto are to our see approval, I which cite subject, rule, 15-6-50(b). According to the SDCL Company American Life Insurance United law, jury right rules of common to (1972), Urman, Colorado, 1158 495 P.2d v. by the preserved trial was Seventh Amend- per- holds that generally which The common law ment the Constitution. regard without repay loans sonally bound al- principle has the well-established advances, depending to commissions though questions of fact must be decided between the in existence the contract jury not be reexamined may company. insurance court, as to or not question whether ques- evidence to raise a situation where there sufficient example of a good A presented jury tion of to the Judgment for or fact to verdict is called directed question of law to be decided the court. should be en- Notwithstanding the Verdict 352 Inc., Alaska, Enterprises, power

Taylor v. Interior the court to withdraw cases 405, (1970). 407 471 P.2d jury from the in a case appears such as this to be firmly history rooted in and tradition. early 1850 our United As States Su- grant direct- approved of a preme Court Therefore, I must conclude trial verdict, Ross, 362, v. 52 13 ed Parks U.S. court’s grant decision to a Judgment Not- (1850). Although con- L.Ed. 730 withstanding the Verdict did not violate controversy propriety about siderable Fluharty’s right constitutional a jury tri- verdict, practice of directed VI, 6, al as set forth in Article Section appears that was resolved in 1943 in the South Dakota State Constitution and States, v. Galloway 319 the case the Seventh Amendment to the United 372, 1077, (1943). 87 L.Ed. 1458 U.S. S.Ct. States Constitution. waters have not been so smooth with Notwithstanding respect Judgments judicial throughout contemporary

Verdict v. In the case of Slocum New York

times. Co.,

Life Insurance U.S. S.Ct. (1913), 57 L.Ed. 879 our United States entry judg- Court held that the contrary the verdict was a

ment violation However, Amendment. Seventh CO., DELZER CONSTRUCTION qualified in 1935 the case of largely Respondent, Plaintiff and Redman, Line Baltimore & Carolina v. 79 L.Ed. 1636 U.S. S.Ct. case, judge the latter ex- In had SOUTH DAKOTA STATE BOARD OF his decision on motions for

pressly reserved TRANSPORTATION, Defendant verdict and had submitted the case Appellant. the reservations. case, judge the Slocum No. 12229. unconditionally submitted the case *6 distinguishing This was factor. Supreme Court of South Dakota. It is be noted that in the instant case Feb. before us that a motion a directed ver- made, had been the reasons set forth in dict

particularity judge and that submitted

the case the motion for verdict Under Federal Midland. 50(b) statute,

Rule and our state SDCL

15-6-50(b), provides: rule now

Whenever a motion for directed verdict

made at the close all the evidence is granted,

denied or for reason

the court is to have deemed submitted the jury subject to later deter- legal questions

mination raised added.) (Emphasis

the motion. States Court has 50(b).

approved practice under Rule Co.,

Neely Eby v. Martin K. Constr.

U.S. S.Ct. 18 L.Ed.2d

(1967); Montgomery Co. v. Dun Ward &

can, 189, 85 311 U.S. L.Ed. 147 S.Ct.