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First Nat. Ben. Soc. v. Sisk

Supreme Court of Arizona

October 7, 1946

FIRST NAT. BEN. SOC.
v.
SISK et al., Employment Security Commission

Appeal from Superior Court, Maricopa County; Arthur T. LaPrade, Judge.

Proceeding by the First National Benefit Society, a corporation, against Dean A. Sisk, Robert D. Kendall, and John M. Sakrison, as members of and constituting the Employment Security Commission of Arizona, to review an order of the commission requiring the corporation to pay unemployment contributions on its insurance agents. From a judgment of the superior court affirming the commission's order, the corporation appeals.

Judgment modified and, as modified, affirmed.

Robert R. Weaver, of Phoenix, for appellant.

Arthur M. Davis, of Phoenix, for appellees.

Farley, Superior Judge. Stanford, C. J., and Morgan, J., concur. Judge A. T. La Prade being disqualified, the Honorable Gordon Farley, Judge of Superior Court of Santa Cruz County, was called to sit in his stead.

OPINION

Farley, Superior Judge.

Page 102

[65 Ariz. 3] This is an appeal from a judgment of the Superior Court of Maricopa County affirming an order of the Employment Security Commission of Arizona requiring the appellant, First National Benefit Society, a corporation, to pay unemployment contributions on its insurance agents. The Commission's order requiring contributions pertained to the period beginning on January 1st, 1936, the effective date of the Unemployment Compensation Act, to June 16, 1941, when by statutory enactment insurance agents were specifically excluded from the provisions of the Unemployment Compensation law.

Appellant's agents, solicitors, or deputies, as they have been variously termed by the parties, solicit insurance prospects for the appellant, the First National Benefit Society, in accordance with one or more of three written contracts between the agent and the Society. By the terms of the contracts, all of which are similar, the agent agrees to solicit insurance for which he is compensated by retention of the initial membership fee and by payment to him of subsequent renewal commissions from the Society.

The pertinent portions of the contract, insofar as the issues here are concerned, provide that:

[65 Ariz. 4] Exhibit 1.

"2. It is hereby agreed that there are no requirements nor restrictions as to the time, amount of time, or energy expended by the deputy in connection with this Agreement."

"4. The said Deputy agrees to solicit and recommend for membership in the Society only persons who are in good health, of good moral character, and within the prescribed age limits, and whom he believes

Page 103

to be eligible and acceptable as members. That such recommendations for membership shall be accompanied by an application of the proposed member on forms to be furnished by the Society. The said Deputy agrees to send in or deliver all applications promptly and to make no misrepresentation in regard to the Society or its plan of operation. The Deputy further agrees to observe and adhere to the underwriting rules of the Society."

"7. The Society may designate territory in which the Deputy shall operate in accordance with its discretion. Any attempt by said Deputy to transfer or rewrite into any other company, society or association, any member of this Society, shall forfeit his renewal commissions. Failure on the part of the Deputy to comply with the terms of this contract shall absolve all future liability on the part of the Society."

"9. The Society shall at all times have the right to reject in its absolute discretion, any application for membership, without specifying cause of such rejection and the Deputy agrees in the event of rejection to refund all moneys collected from the applicant, within 10 days of the date of rejection."

"12. This Agreement supersedes any agreement whether oral or written, between the Society and the Deputy, and may be terminated by either party at any time upon written notice to the other, subject to the ...


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