Insurance Agent's Signing Of Another's Name, With Authority But Without An Indication Of Authority, Is "Dishonest" Under Agency Agreement
ROTH v. AMERICAN FAMILY MUTUAL INSURANCE COMPANY (June 5, 2009)
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The plaintiffs, Bonnie and Connie Roth, were insurance agents. Each had an agency agreement with American Family Mutual Insurance Company. The agreement provided that it could be terminated for "undesirable performance" only with six months notice and an opportunity to correct. It also provided that it could be terminated without notice if an agent engaged in "dishonest, disloyal or unlawful" conduct. One of the agents signed an applicant's name on a insurance policy application at the applicant’s request. The other signed the name of a different agent on a policy certification, also with authorization. American Family terminated their agency agreements. The Roths brought suit for breach of contract. The district court granted summary judgment to American Family. The Roths appeal.
In their opinion, Chief Judge Easterbrook and Judges Posner and Wood affirmed. The Court considered whether signing another's name is "dishonest" under the agreement. The Court appreciated that neither agent gained personally by her conduct and that a typical element of dishonesty is theft. However, the Court went on to consider other meanings of dishonesty, including breach of trust and deceitful behavior. The Court concluded that the act of signing another’s name without any indication of authority was deceptive and fit within the agreement’s provision allowing termination without notice.
