SPEEGLE v. BOARD OF FIRE UNDERWRITERS OF THE PACIFIC (1945)

This appeal is from a judgment in favor of the defendants entered after an order had been made sustaining, without leave to amend, their demurrers to the second amended complaint.

By this action the plaintiff seeks damages against some of the defendants for inducing other defendants to terminate agency contracts existing between themselves and the plaintiff.

There are two groups of defendants. One group, headed by the Board of Fire Underwriters of the Pacific, an unincorporated association, is composed of the Board itself, and fourteen insurance companies and one association (Board members), all of which appear jointly and severally on one demurrer. The other, headed by The Salinas Association of Local Insurance Agents, an unincorporated association, is composed of the Salinas Association itself and twelve individuals or firms, all engaged in the insurance business in Salinas, nine of whom appear jointly and severally on the other demurrer. Each one of this group is an agent of the Board.

The complaint shows that for some years the plaintiff has been engaged as an insurance agent and broker in Salinas, and between the year 1927, when he got his agent's license, and 1939, when the break came, he held agency contracts with the insurance company defendants as well as with non-board companies. It alleges that on March 6, 1939, the Board, the Salinas Association, and the defendant insurance companies, acting in concert, caused, brought about and induced the termination of the plaintiff's agency contracts with the defendants Nward Fire Insurance Co., Fireman's Fund Indemnity Co. and Fireman's Fund Insurance Co. and ever since then those three companies have refused to deal further with plaintiff or to accept further business tendered by him. It also alleges that on July 26, 1936, the Board sought to impose two conditions upon the plaintiff under the threat that in case of non-compliance the Board would bring about a termination of his agency contracts with the twelve remaining defendant insurance companies. Those conditions were: ‘(1) That plaintiff immediately terminate any agency representation of companies other than members of the Board whether or not held for lines other than fire; (2) that plaintiff discontinue his broker's license.’ It alleges that plaintiff refused to comply and on July 26, 1939, the Board, the Salinas Association and the defendant insurance companies caused to be brought about, and induced, the breach and termination of the plaintiff's agency contracts with said twelve defendant insurance companies, and ever since then those twelve companies have refused to deal further with plaintiff or to accept business tendered by him. Other averments will be discussed later.

That a third party's unjustifiable interference with contractual relations is actionable is now well settled in this state. Imperial Ice Co. v. Rossier, 18 Cal.2d 33, 112 P.2d 631; California Grape Control Board v. California Produce Corporation, 4 Cal.App.2d 242, 40 P.2d 846; Remillard-Dandini Co. v. Dandini, 46 Cal.App.2d 678, 116 P.2d 641.

The appellant contends that his pleading brings the case within this rule in that it shows the breach of permanent agency contracts, brought about and induced by the defendants. The defendants contend that the complaint shows merely principal and agent contractual relations with no definite time specified for their existence and therefore terminable at the will of either party; moreover, they contend that to plead a ‘permanent’ relation is only to plead one for an indefinite time and hence terminable at will.

By the demurrer it is admitted that the agency contracts were cancelled and terminated by the respective principals. The question presented for decision is whether such cancellation amounted, in legal effect, to a breach of them. If not, it would seem to follow that no action could possibly lie against third parties for inducing such termination. The first inquiry would therefore seem to be whether, under the law of this state, an agency contract with no definite time specified for its duration may be terminated at the will of either party. The defendants rely on the case of Bentley v. Mountain, 51 Cal.App.2d 95, 124 P.2d 91, decided by this court, which was not an agency case but one involving a collective bargaining contract between a labor union plaintiff and shop-keeper defendants, calling for the display of union shop cards (indicating, of course, that the place was a union shop) in their windows. In addition to suing for breaches of the contracts themselves, the plaintiff sued for inducing the breaches of them and of other similar contracts. When the shop keepers ceased to maintain union shops and to display union shop cards, the union sought an injunction. A demurrer to the complaint was sustained without leave to amend and on appeal that order was upheld on the ground that the contract was for no specified period of time and was therefore terminable at the will of either party. In that opinion Adkins v. Model Laundry Co., 92 Cal.App. 575, 581, 268 P. 939, was cited in support of the rule. The Adkins case did not involve an agency contract but was a laundry route case. It, in turn, relied on and followed Otten v. Spreckels, 183 Cal. 252, 259, 191 P. 11, which was an agency case and will be discussed presently.

The defendants also rely upon Lord v. Goldberg, 81 Cal. 596, 22 P. 1126, 1128, 15 Am.St.Rep. 82, which was an action brought by an employee to recover damages for his wrongful dismissal. A judgment in plaintiff's favor was reversed on the ground that the findings were not justified by the evidence. On appeal the court held that the plaintiff had voluntarily left the employ of the defendants and had not been dismissed. After so holding the court said: ‘But, however this may be, it is clear that plaintiff's employment was not intended to be for life, or for any fixed or certain period. It was to be ‘permanent,’ but that only meant that it was to continue indefinitely, and until one or the other of the parties should wish, for some good reason, to sever the relation.'

The appellant, in seeking to distinguish the instant case from the Bentley, Adkins and Lord cases, contends that ‘A contract of employment resting on a consideration, which by its terms is ‘permanent’ is not terminable at will,' and directs our attention to what we said with respect to Lord v. Goldberg in the recent case of Millsap v. National Funding Corp., 57 Cal.App.2d 772, 773, 775, 135 P.2d 407, 409, as follows: ‘While the Supreme Court in Lord v. Goldberg, * * * used language indicating that a contract for permanent employment is in legal effect only a contract for indefinite employment terminable at the will of either party, the later cases of Seifert v. Arnold Bros., Inc., 138 Cal.App. 324, 31 P.2d 1059; Brown v. National Electric Works, 168 Cal. 336, 143 P. 606 and Davidson v. Laughlin, 138 Cal. 320, 71 P. 345, 5 L.R.A.,N.S., 579, make it clear that a contract for permanent employment based upon sufficient consideration is enforceable according to its terms and may not be terminated at the will of the employer without good cause.’ In Lord v. Goldberg, the question of a consideration for the employment was not raised or decided. In the Seifert case the parties agreed that in consideration of plaintiff purchasing from defendants a used automobile, the defendants would employ plaintiff at $80 a month, the employment to be steady as long as his services were satisfactory. He bought the car and entered their used car department. In a short time he was let out and sued for damages for wrongful discharge. The court found that the defendants had bound themselves to keep him on for a reasonable time but had not done so and that his services had been satisfactory. In affirming the judgment for plaintiff the court said that the contract was ‘based on a consideration in addition to services to be rendered.’ [138 Cal.App. 324, 31 P.2d 1060.] (Emphasis ours.) In Brown v. National Electric Works, supra, the defendant agreed to give the plaintiff steady employment if he would purchase $5,000 of stock in the defendant corporation, which he did. The plaintiff was discharged without cause after a short time. It was held that there was an implied contract, arising from the valuable consideration, to continue the employment for a reasonable time; that the discharge in three months was a breach of such contract, and that the plaintiff was entitled to rescind and recover the $5,000 which he had paid for the stock. Davidson v. Laughlin, supra, was a case where the defendant was erecting a building and the plaintiff was working for him. During the construction period the defendant promised that when the building was finished he would employ plaintiff permanently as agent of the building at $150 a month, in consideration of which the plaintiff agreed to work during construction at a reduced rate of $60 a month. A few days after completion the defendant dismissed plaintiff from the promised position and he sued for and was awarded the difference between $60 and $150 a month for the time he had worked during construction. The defendant contended that the rule followed by the trial court did not apply because the contract for permanent employment was for an indefinite time only and could be terminated by either party upon reasonable notice. It was held that the lower court was correct in awarding judgment to the plaintiff. In the Millsap case the plaintiff, on being offered employment by the defendant, stated that she was then employed and would not change unless the new position would be permanent. The defendant agreed that it would be, whereupon she went to work for the defendant. She was discharged in a short time and sued, claiming a contract for permanent employment based upon a consideration, namely, the legal detriment she had suffered in giving up her old position. The court found that it was a sufficient consideration and it found, further, as in the case of Brown v. National Electric Works supra, that in the bargain which the parties had made there was an implied promise to keep her on for a reasonable time; that two years was such reasonable time, and that her dismissal without cause within that time breached the contract. On appeal this court held that such findings were justified by the evidence. In each of these four cases, it will be noted, the employee suffered a legal detriment at the time of entering upon the employment. They could have no bearing upon this case unless the complaint pleaded that the defendants had promised that the agency contracts would exist for a definite term and it was claimed by the other side that there was no consideration for such promise.

Otten v. Spreckels, supra, was an agency case where Otten alleged that he had paid Spreckels $3,000 as consideration for the agency but (to quote from the opinion [183 Cal. 252, 191 P. 12]), ‘It was admitted * * * that no consideration for the contract passed between the parties, other than their respective stipulations therein.’ What the case holds is well summed up in Adkins v. Model Laundry Co., supra [92 Cal.App. 575, 268 P. 941], as follows: ‘In the case of Otten v. Spreckels, 183 Cal. 252, 259, 191 P. 11, 13, which was a suit for damages for breach of contract in discharging an agent employed to take charge of a newspaper route, who was paid commissions upon the newspapers which he sold judgment in favor of the agent was reversed, and the court said: ‘* * * Where the agency is revocable at will, as in this case, he has no interest or right which he can assert against his principal who revokes it, as the basis for damages for such revocation. * * * The agency being terminable at will by the principal and being for an indefinite term and without a valuable consideration, its revocation was not a breach of the contract. The plaintiff has no cause of action and the judgment should have been for the defendant.’' (Emphasis ours.) Otten v. Spreckels is a companion case of Boehm v. Spreckels, 183 Cal. 239, 191 P. 5, and what was held in the latter case is best summed up by Mr. Justice Shaw, the author of both opinions, in the Otten case (page 257 of 183 Cal., page 13 of 191 P.) as follows: ‘We have there held that such a contract creates an agency only; that it does not vest in the agent any interest in the subject of the agency; that the agency is not coupled with an interest; that it is for an indefinite period, and hence that it is revocable by the principal at any time. We further held that, unless such agency was given for a valuable consideration, it could be revoked by the principal without liability to the agent for any loss or damage to him that might be caused by loss of the compensation provided for him by the contract of agency.’ (Emphasis ours.) The opinion in the Otten case then proceeds to discuss the subject of consideration as follows: ‘The agency in the present case was not given for a valuable consideration. It cannot seriously be contended that the effect of the stipulations of the respective parties, as being a consideration sufficient to support it as a contract, is sufficient to take it out of the rule of section 2356 of the Civil Code that an agency may be terminated by the principal, or to bring it within the rule that if an agency is given for a valuable consideration that principal will be liable in damages if he revokes it before the agent has had a reasonable time to enjoy his agency so as to some extent to reimburse himself for his outlays in getting it or in preparing to perform the duties imposed on him thereby. All of the cases on that subject involve the payment of some money by the agent to secure the agency, or the incurring of preliminary expenses by him in preparing to execute the powers given him. No reason can be given for the proposition that his agreement to faithfully perform the duties required of him by his contract of employment will, as a valuable consideration, make this rule applicable. The law would make him subject to that obligation without any stipulation. 2 Cor.Jur. p. 692; Civ. Code, § 2228; Calmon v. Sarraille, 142 Cal. [638], 641, 76 P. 486.’ (Emphasis ours.)

An examination of the plaintiff's averments should be made in the light of these rules, with a view to determining whether they show a contract for a definite period based on a consideration of the kind and character discussed in these cases.

The only parts of plaintiff's complaint which attempt to plead anything in the nature of a consideration are paragraphs VI, VII, VIII and IX, in substance as follows: That plaintiff ever since the issuance of his agent's and broker's licenses has continuously carried on, conducted and built up a general insurance agency and brokerage business, including the class of insurance written by Board member defendants, and as known to them, has placed insurance with such Board companies as well as with non-board companies when such insurance could be placed to the advantage and best interest of the insured under the competitive conditions existing in such business.

That in the course of his business plaintiff has entered into contracts in writing with defendant Board members, and with each of them, whereby they appointed him their agent respectively with authority to solicit, and accept proposals for insurance risks in Salinas and vicinity under which he would receive commissions on contracts and their renewals, and that his agency contracts contained no provisions restricting his activities as agent and no provision that he should represent only Board, as distinguished from non-board, companies, and at all times the Board and the Salinas Association knew of such agency contracts. That a general practice and usage exists in the insurance business in connection with the appointment of agents with authority to solicit and receive applications for insurance that the agent had the continuing privilege of placing an application with any company, Board or non-board, as might be requested by the applicant or for his best interest, and that the insurance company had no interest in the application obtained by the agent until it was presented to the company and it had been accepted, and that such practice and usage is no breach of an agency agreement; that it is likewise a general practice and usage that the agent may also become a broker in relation to companies for which he is not an agent, and may, for compensation, transact insurance business of all classes, other than life, for persons other than an insurer for whom he is acting as agent, and that such broker may place an application for insurance secured by him as broker with any company, board or non-board, as may be requested by the applicant, or to his advantage, and that such brokerage business and activity of an agent is no breach of an agency agreement; that it is also the general practice and usage that an agency shall be of a permanent and independent nature and that the agency agreement will not be cancelled except for good and lawful cause as between the parties thereto and that in consideration of care given to the insured by the agent in the exercise of his agency he shall be entitled to the usual commission on all renewal premiums; that each of said practices and usages entered into and became a part of the agency contracts by which the defendant insurance companies appointed plaintiff their agent, respectively, and were known to the Board, its members, and to the Salinas Association and its members, and that plaintiff entered into all such agency contracts with knowledge of and in reliance on said practices and usages, all of which were generally recognized and followed by the Board, and the Salinas Association, except as later alleged, and that plaintiff was thereby influenced to enter into such agency contracts and to engage in and build his agency and brokerage business. That through plaintiff's diligent, careful and constant work and effort since 1927, and the expenditure of large sums of money he built up and became the owner of a very substantial insurance business, all in reliance on the agency agreements aforesaid, on said practices and usages, and in reliance on the permanancy of the business relationship and his rights thereunder to commissions on renewals of insurance written; that plaintiff's business, considering past earnings and probable future earnings was of the fair and reasonable value of $200,000 as of March 1, 1939.

The foregoing summary shows that the agency contracts are in writing. A written contract may be pleaded in haec verba or according to its legal effect. In the pleading of the legal effect of these writings their term or duration nowhere appears. This omission was pointedly called to the pleader's attention by the demurrers to the first amended complaint which specified that it did not appear therefrom ‘during what periods said contracts were by their terms to be in force; nor whether or not such contracts were terminable at will.’ Nevertheless, the present pleading is substantially the same as the earlier one except it alleges that a general practice and usage exists ‘that such agency shall be of a permanent and independent nature and that the agency agreement will not be cancelled except for good and lawful cause as between the parties thereto.’ It does not allege that the written contract says this, but it does allege ‘that each of said practices and usages * * * entered into and became a part of the said agency contracts'. With respect to the allegation of permanency, we advert to Lord v. Goldberg, supra: ‘It was to be ‘permanent,’ but that only meant that it was to continue indefinitely, and until one or the other of the parties should wish, for some good reason, to sever the relation.' See also Bouvier's Law Dict., Rawle's Third Revision, Vol. 3, p. 2568; 18 R.C.L. p. 509, sec. 20. If that be the rule (and it has never been questioned in California) then the most that can be said (if the allegations of general practice and usage are assumed to be well pleaded) is that the complaint alleges contracts terminable at the will of either party. But as was said in Hanley v. March & McLennan-J. B. F. Davis & Son, 46 Cal.App.2d 787, 798, 117 P.2d 69, 74, ‘* * * usage and custom may be introduced as an instrument of interpretation but may not be used to create a contract. This thought is thus expressed in section 1870 of the Code of Civil Procedure as follows: ‘In conformity with the preceding provisions, evidence may be given upon a trial of the following facts: * * * 12. Usage, to explain the true character of an act, contract, or instrument, where such true character is not otherwise plain; but usage is never admissible, except as an instrument of interpretation; * * *’. See, Rottman v. Hevener, 54 Cal.App. 485, 202 P. 334. * * *' See, also, on the subject of pleading custom and usage, Boehm v. Spreckels, 183 Cal. 239, 244, 191 P. 5.

Counsel for appellant have this to say on the subject of consideration: ‘In this case the plaintiff expended his own time and money in carrying out the terms of his agency agreement. He may or may not be compensated. Should his work and expense result in a failure to obtain an application for insurance, or should the insurance company reject the risk, he will receive no compensation and be out his expense. When the insurance company grants an agency agreement, and when the agent accepts it, this is done in consideration of the future efforts and expenditures of the agent for which he may or may not be compensated. This is also the general usage, custom and practice of the insurance industry. The employment of the agent, therefore, becomes one resting upon a consideration running from the agent to and for the benefit of the insurance company. The agent has changed his position on the strength of the agency agreement and the usages and practices of the industry and undertaken to expend his own time and money, in the expectancy that the insurance company will accept the result of his work.’ This does not square with what was said in Otten v. Spreckels, quoted earlier, where the court pointed out that the consideration which is necessary to support a promise for a definite term as agent is one moving from the agent to the principal at the time the agency contract is entered into. It does not square with the Seifert case, where it is said that the consideration is ‘in addition to services to be rendered,’ nor is it such a consideration as is spoken of in the Millsap, Brown and Davidson cases, relied on by appellant. See also, 6 Cal.Jur. p. 167, sec. 116, where the rule is thus stated: ‘The sufficiency of a purported or claimed consideration for a contract must be determined from the facts of the transaction as they existed when the contract was made, rather than by subsequent developments * * *’. A careful examination of the complaint shows that no such consideration is pleaded.

The complaint charges, in rather strong language, that the defendants acted with the intent to injure the plaintiff and destory his business. In the Rossier case, supra [18 Cal.2d 33, 112 P.2d 633], it is said: ‘The presence or absence of ill-will, sometimes referred to as ‘malice’, is immaterial, except as it indicates whether or not an interest is actually being protected,' citing Boyson v. Thorn, 98 Cal. 578, 33 P. 492, 494, 21 L.R.A. 233. In the latter case the court quotes Cooley on Torts, 2d Ed. p. 832 which concisely states the rule followed by the California cases as follows: ‘Bad motive, by itself, then, is no tort. Malicious motives make a bad act worse, but they cannot make that a wrong which in its own essence is lawful. When in legal pleadings the defendant is charged with having wrongfully done the act complained of, the words are only words of vituperation, and amount to nothing unless a cause of action is otherwise alleged.’ The language in the pleading, however strong and vituperative, does not allege, or help to allege, a breach if a breach is not pleaded without it.

In paragraph XIV of the first count it is alleged that the conditions imposed upon plaintiff by defendants were not part of the agency contracts but were imposed ‘with the object and purpose, through coercion and oppression, of dominating, controlling, injuring, impairing or destroying plaintiff's business * * * and said conditions were unlawful and imposed illegal and unlawful restraint and restriction upon plaintiff in the exercise of his lawful business' and that the failure of plaintiff to yield to them afforded no lawful ground or justification for the cancellation and breach of the agency contracts. In this connection it is argued by appellant that he had a lawful right to act as both agent and broker; that from 1927 to 1939 he had so acted, including the representation of non-board companies, and that there was nothing in the agency contracts to the contrary. That may be conceded, but still it does not follow that the principal, for reasons of its own, and acting entirely in its own interests and for its own economic advantage, could not at any time object to carrying on future relations with the plaintiff if he persisted in representing non-board companies, which were in competition with Board companies. The principal would have the same right to impose the condition with respect to plaintiff's broker's license. Each party was free to end the relation at any time and therefore could impose conditions (unless they were illegal) respecting its continuance. If, for instance, the agent's territory from 1927 to 1939 had included only Monterey County, he could have imposed on his principal in 1939, or at any other time, the condition that unless he be given the agency for Santa Cruz and San Benito Counties as well, he would terminate his existing agency contract as to Monterey County. The rights of the parties were reciprocal.

With respect to the allegations of a conspiracy: It has been held that the language of a pleading as to concert of action, confederation and conspiracy cannot charge an actionable wrong if an actionable wrong is not otherwise charged. The following taken from Bentley v. Mountain, supra [51 Cal.App.2d 95, 124 P.2d 93], is apposite: ‘Plaintiff alleged a ‘conspiracy’ between defendants but conspiracy, in and of itself, is not actionable. In Richmond Terminal Corp. v. Parr Terminal Co., 116 Cal.App. 368, 2 P.2d 579, the complaint alleged that defendants had conspired to do certain acts. This court there said at page 369 of 116 Cal.App., at page 579 of 2 P.2d, ‘Such allegations are insufficient unless it appears that some right of plaintiff has been violated by some alleged wrongful act or acts or defendants for ‘conspiracy cannot be made the subject of a civil action unless something is done which, without the conspiracy, would give a right of action.’' See, also, Bowman v. Wohlke, 166 Cal. 121, 125, 135 P. 37, Ann.Cas.1915B, 1011; Moropoulos v. C. H. & O. B. Fuller Co., 186 Cal. 679, 200 P. 601. As above indicated there are no allegations of fact in the amended complaint before us which show that any of the acts of the defendants violated any right of plaintiff * * *.' In their opening brief counsel for appellant say: ‘It is not material to the second cause of action, or to the first cause of action for that matter, that the agency contracts held by the plaintiff were contracts terminable at will. The defendants, acting in concert, had no right to impose their joint will on the plaintiff and induce the breach and cancellation of all of the insurance agency contracts, even if it be assumed * * * that the agency contracts were for an indefinite period and were terminable at will.’ This statement does everything but concede flatly that the agency contracts were terminable at will. But it does more; it makes the claim that concerted action of the defendants alone and by itself is actionable. The cases just cited hold directly the other way.

It should be noted that the second count of the complaint is almost a duplication of the first count. The only differences are that in alleging the building up of plaintiff's insurance business with the knowledge of each of the defendants the second count adds that it was also with the acquiescence of each of them. And in alleging that plaintiff's expenditure of work, effort and money in the building up of his business was in reliance upon the agency agreements, plaintiff also alleges that it was also in reliance on defendants' knowledge and acquiescence. And to his allegations of reliance plaintiff added in the second count that such reliance on his part was known to said defendants and each of them. In our view of the case the second count adds nothing, substantially, to the first.

The three cases cited at the outset, namely, the Rossier, Grape Control and Dandini cases, which lay down the general rule that a third party's unjustifiable interference with contractual relations is actionable, are relied on by appellant, but they are not specifically in point herein. The Rossier case is not in point because there the interference by Rossier and Matheson consisted of inducing Coker to breach a contract which bound him to stay out of the ice business in certain territory as long as his vendee, or his vendee's successors, were engaged in such business therein. The contract was not for an indefinite term. In the Grape Control case, the contract covered ‘all grapes produced, owned or controlled by said growers during the calendar years 1930–1939.’ The interference was in 1931. The Remillard-Dandini case was a suit to enjoin interferences by the defendant with subsisting obligations of the corporation including contracts for the furnishing of supplies and materials which the corporation badly needed. Three other cases are relied on by appellant. Patterson Glass Co. v. Thomas, 41 Cal.App. 559, 183 P. 190, is distinguishable from the case at bar in that the contracts were for definite periods, namely, some for the season of 1917–18 and others were terminable only on seven days notice. Such distinction is pointed out at length in Bentley v. Mountain, supra. The facts of the Parkinson case, Parkinson Co. v. Building Trades Council, 154 Cal. 581, 98 P. 1027, 21 L.R.A.,N.S., 550, 16 Ann.Cas. 1165, are altogether different from those in the instant case. This brings us to the case of Traux v. Raich, 239 U.S. 33, 36 S.Ct. 7, 60 L.Ed. 131, L.R.A.1916D, 545, Ann.Cas.1917B, 283. Neither that case nor the authorities which it cites from outside states are to be reconciled with the California cases cited herein on the subject of contracts terminable at will. The cases from other jurisdictions are not, of course controlling here. It is our duty to follow the cases decided by our own courts.

The appellant's final point is that the ‘complaint states a cause of action against defendants under the Cartwright Act’ (Bus. & Prof. Code, secs. 16700–16758, St.1941, p. 1834 et seq.).

The complaint alleges in paragraphs II and III, and elsewhere, that the Board is an association of a large number of insurance companies; that the agreement of association of members has for its object an association and confederation which could, should and would, through coercion and oppressive methods, and otherwise, dominate and control, to their economic advantage, the class of insurance written by its members, fix the terms, conditions and rates for such insurance, the terms upon which its members may employ their respective agents, and likewise dominate and control the business and business methods of such agents by and through such coercion, oppression, domination and control limiting and restricting and restraining fair competition. However, after this case had been argued the District Court of Appeal, Second District, in the case of Ward v. Auctioneer's Association, 153 P.2d 765 (following Cline v. Frink Dairy Co., 274 U.S. 445, 47 S.Ct. 681, 71 L.Ed. 1146) held that the Cartwright Act was unconstitutional. A hearing by our Supreme Court was denied. That decision therefore removes the point from further consideration on this appeal.

The respondents contend that it is essential to a good cause of action for inducing a breach that a third person shall have induced it and that here, because of the identity of the Board with its constituent company members, whatever the Board did was the act of the insurance companies themselves and not the act of a stranger or third party. The conclusion at which we have arrived that the complaint fails to show that the agency contracts were breached, and therefore that no action will lie for inducement, renders unnecessary any discussion of this point.

In appellant's closing brief we are reminded that: ‘The agency agreements here under consideration, and their revocation, are governed by the law of agency. (Civil Code, sections 2355–2356.)’ Throughout the consideration of this case we have been mindful of this, and the authorities which have been cited in support of our conclusion are, for the most part, either agency cases themselves or cases whose lineage is traceable directly to agency cases. It is not necessary to go beyond the rules which they announce and we have striven herein to stay strictly within their range.

We are satisfied that the demurrers were properly sustained.

The judgment is affirmed.

GOODELL, Justice.

NOURSE, P. J., and DOOLING, Justice pro tem., concur.