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National Premium Budget Plan Corp. v. National Fire Insurance Co.
Decided: July 3, 1969.
NATIONAL PREMIUM BUDGET PLAN CORPORATION, A CORPORATION OF THE STATE OF MICHIGAN, PLAINTIFF-APPELLANT,
NATIONAL FIRE INSURANCE COMPANY OF HARTFORD, A CORPORATION OF THE STATE OF CONNECTICUT, LOUIS J. MARTONE, EDWIN M. ROTHBERG, AND PRICE AGENCY, A PARTNERSHIP COMPOSED OF LOUIS J. MARTONE AND EDWIN M. ROTHBERG, AS CO-PARTNERS, DEFENDANTS-RESPONDENTS
Conford, Kilkenny and Leonard.
The nature of the action, the issues and the general factual background are fully delineated in the opinion of the trial court. 97 N.J. Super. 149 (Law Div. 1967).
Plaintiff sued defendants ("National Fire" and Edwin M. Rothberg) for damages sustained on loans it made to finance
premiums on insurance policies supposedly issued by National Fire when the loan moneys were feloniously misappropriated by one Martone, insurance agent for National Fire. Eight of the loans were placed by Martone as the agent who purportedly wrote the policies, and two by Price Agency (for which Martone and Rothberg had once filed a partnership certificate) as purported writing agent.
National Fire was sued on theories of respondeat superior for Martone's fraud as agent, and for its own negligence through acts of office employees. Rothberg was sued on the theory of liability of a partner for acts of a copartner assertedly done within the scope of the partnership business.
The decision of the court, sitting without a jury, on the facts and the law, was for defendants National Fire and Rothberg. (Martone was also a defendant, but does not appeal from the judgment against him.)
We have concluded the judgments should be affirmed, although we do not necessarily agree with all of the findings or inferences of fact or all the conclusions of law set forth in the very lengthy opinion of the trial court.
We address our attention to the appellate arguments.
Plaintiff's major contention as against National Fire was that the latter is liable on principles of respondeat superior for the fraud of its agent Martone. Martone was an ordinary insurance agent for National Fire. We are satisfied he was not its agent when arranging premium loans in connection with its policies. For that purpose he was the agent alone of his insureds, and he was also acting on his own behalf to obtain the advantages flowing therefrom. True, National Fire encouraged all its agents to arrange for financing premiums for insureds needing such financing since this was good for the business of both the company and the agent. But it is one thing for the company to encourage such activity by its agents, another for it to get into the premium financing
field on its own account. We agree with the trial court's conclusion that there was neither express nor implied agency of Martone for National Fire in ...
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