Appeal from the United States District Court for the District of Kansas, First Division; Bower Broaddus, Judge.
Before PHILLIPS, HUXMAN, and MURRAH, Circuit Judges.
The American National Insurance Company instituted this action for a declaratory judgment, seeking an adjudication of its liability under a contract with Harold Franklin and Lucile Franklin.
The complaint in substance alleged that the International Brotherhood of Boilermakers, Iron Shipbuilders and Helpers of America*fn1 is a fraternal beneficial society organized for the mutual benefit and protection of its members, and that it affords to members insurance benefits; that on July 1, 1929, plaintiff entered into an agreement with the Brotherhood under which it reinsured the liability of the Brotherhood to its members; that about June 18, 1939, a dispute arose between the plaintiff and one Shannon C. Douglass, who claimed certain commissions from plaintiff as a result of said contract; that a dispute also arose between plaintiff and the defendants, Harold Franklin and Lucile Franklin, who claimed an interest in the commissions claimed by Douglass; that on June 18, 1939, the parties to this action executed an agreement, compromising and settling the claims of the defendants to any commissions from the plaintiff arising out of the reinsurance contract of July 1, 1929. The agreement as set out in the complaint involves numerous matters not material to the controversy between these parties. So far as material, the agreement is as follows:
"Now, Therefore, It Is Hereby Mutually Agreed, by and between American National Insurance Company, a corporation, of Galveston, Galveston County, Texas, of the first part, and Harold Franklin and Lucile Franklin, of the second part, as follows:
"1. In consideration of the mutual promises and agreements hereinafter contained and of the sum of One Dollar, to it in hand paid by the said second parties, said first party hereby agrees to pay said Harold Franklin and Lucile Franklin, their executors and administrators, the sum of Thirty-six Thousand ($36,000.00) Dollars, payable as follows: Ten Thousand ($10,000.00) Dollars in cash upon the execution and delivery of this agreement, and the balance of Twenty-six Thousand ($26,000.00) Dollars in monthly installments of Three Hundred ($300.00) Dollars each, commencing on the 30th day of June, 1939, until said balance of Twenty-six Thousand ($26,000.00) Dollars has been fully paid and discharged; and thereafter to pay the said Harold Franklin the sum of Three Hundred ($300.00) Dollars per month, payable on the first day of each and every month as long as the first party carries the coverage under a group contract between the American National Insurance Company and International Brotherhood of Boilermakers, Iron Shipbuilders and Helpers of America. And it is understood that in consideration of the payment of said monthly installments, the said Harold Franklin hereby agrees to perform such reasonable services as he may be requested by said first party to perform in connection with said insurance coverage and to use his best endeavors to keep the said group insurance policy in force.
"2. In further consideration of the payment of the said sums of money hereinbefore mentioned, the said Harold Franklin and Lucile Franklin, jointly and severally hereby, for themselves and their, and each of their, executors and administrators, release and forever discharge said American National Insurance Company, its successors and assigns, of and from all liability on account of the assignment of said contract of date of February 27th, 1929, and any and all obligation to sue and recover from the said Shannon C. Douglass the balance of commissions claimed to be due from said Shannon C. Douglass to said Harold Franklin and Lucile Franklin prior to the execution of said assignment dated the 18th day of October, 1937; and for the same consideration hereby release and forever discharge said American National Insurance Company from any and all liability in law or in equity on account of said assignment and payment of commissions and/or service charge under the contract so assigned, and any and all contracts, written and/or verbal, between American National Insurance Company and Shannon C. Douglass involving the payment of a service charge and/or commissions on premiums paid to said Insurance Company under and pursuant to the terms of said group contract.
"In Witness Whereof, the parties hereto have hereunto set their hands this 19th day of June, 1939.
"American National Insurance Company of Galveston, Texas,
"By W. L. Moody, III, Vice-President,