James P. Whitmer - Page 5

                                        - 5 -                                         
          liability of Midwest (or Whitco).2  ITT maintained accounts to              
          document the advance commissions that it had paid to its agents,            
          as well as to monitor the later events that would affect these              
          commissions.                                                                
               ITT, Midwest, and petitioner terminated their business                 
          relationship in July 1983.  On August 3, 1983, ITT filed suit               
          against petitioner, Midwest, and Whitco (collectively referred to           
          as Defendants), for repayment of advance commissions and loans              
          (ITT litigation).  ITT alleged, in part, that Midwest owed ITT:             
          (1) Approximately $237,000 in advance commissions, derived from             
          policies which were under imminent threat of cancellation by the            
          policyholders, (2) $32,068 with respect to two loans,3 and                  
          (3) $100,000 in exemplary and punitive damages.  Petitioner was             
          named as a defendant because he guaranteed all of Midwest’s                 
          obligations to ITT.                                                         
               In or about September 1983, the Defendants answered the                
          complaint, generally denying each material allegation therein.              
          On or about July 23, 1984, the Defendants filed a counterclaim              

               2 Under the Agent's Contract and the Agreement, ITT could              
          cancel its policies and refund the corresponding premiums, and              
          Midwest would be liable for repayment of the unearned commissions           
          on the premiums.                                                            
               3 On or about Nov. 11, 1982, Midwest had borrowed $4,700               
          from ITT, and on or about Feb. 9, 1983, Midwest had borrowed                
          $30,000 from ITT.  The $4,700 loan was repayable (with interest)            
          in 12 monthly payments of $413.20, the first payment due on                 
          Jan. 1, 1983.  The $30,000 was repayable (without interest) on              
          demand, but the entire loan would be forgiven if Midwest met                
          certain life and health insurance quotas.                                   




Page:  Previous  1  2  3  4  5  6  7  8  9  10  11  Next

Last modified: May 25, 2011