Allen v. United States Fidelity & Guaranty Co. of Baltimore

193 Ill. App. 193, 1915 Ill. App. LEXIS 618
CourtAppellate Court of Illinois
DecidedMarch 9, 1915
DocketGen. No. 6,032
StatusPublished

This text of 193 Ill. App. 193 (Allen v. United States Fidelity & Guaranty Co. of Baltimore) is published on Counsel Stack Legal Research, covering Appellate Court of Illinois primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Allen v. United States Fidelity & Guaranty Co. of Baltimore, 193 Ill. App. 193, 1915 Ill. App. LEXIS 618 (Ill. Ct. App. 1915).

Opinion

Mr. Presiding Justice Carnes

delivered the opinion of the court.

David H. Lyons was county treasurer of Bock Island county for the term, four years, beginning in December, 1902. The appellants, F. G. Allen and fourteen others, were the sureties on his official'bond, which was conditioned that he should, “justly and fairlyj account for and pay over all moneys that may come into his hands by virtue of his said office, and shall well and truly perform all and every act and duty enjoined upon him by the laws of this State to the best of his skill and ability, and shall deliver up all moneys, papers, books, records and other things appertaining to said office whole, safe and undefaced, when lawfully required to do so.”

These sureties obtained from the appellee, The United States Fidelity & Guaranty Company of Baltimore, Maryland, an indemnifying bond which was by renewals kept in force during the entire term of office, conditioned that it would, “pay and reimburse the obligees aforesaid all costs, losses, damages and expenses, which they may sustain or suffer by reason of any act of fraud or dishonesty, amounting to larceny or embezzlement on the part of the said David Hamilton Lyons, in connection with the duties of his said office, and which shall have been committed during the period from December 1, 1902.”

County treasurers were during this time ex officio supervisors of assessments in their respective counties under a provision of our Bevenue Act (J. & A. ¶ 9517), and it is there provided that they shall “receive as compensation for his services as supervisor of assessments the sum of one thousand dollars ($1,000) per annum.”

The law is now settled that this provision of the Bevenue Act did not create a new office and that the county treasurer as supervisor of assessments is not entitled to retain the compensation fixed by that statute, in addition to his compensation fixed by the county board. There was an opinion to that effect filed by the Supreme Court in December, 1903, construing the act as it stood prior to the amendment of 1903, (Foote v. Lake County, 206 Ill. 185); another followed in February, 1905 (Parker v. County of Rich-land, 214 Ill. 165); and another in December, 1911 (People v. Bowman, 253 Ill. 234). There is now and can be, no question that Lyons had no legal right to retain any money on account of that provision of the statute, but there was room for honest difference of opinion in the matter. He did retain during his term of office, acting under the advice of credible and competent attorneys at law of his county that he had the legal right to do so, $3,416.70 as his compensation as supervisor of assessments.

In December, 1906, the county board instructed the State’s Attorney of the county to procure the opinion of the Attorney General as to the right of Lyons to retain this amount on that account, and receiving an opinion that he had no right to do so, the board after-wards caused a suit in chancery to be begun and prosecuted against Lyons and the sureties on his official bond, to reform the bond and recover said amount, which suit was determined on appeal by this court and opinion filed March 13, 1912 (People v. Lyops, 168 Ill. App. 396). The decree in that case ordered the payment of said sum, and interest and costs by the defendant. Appellants, the sureties, paid the amount required by the decree and afterwards brought this action claiming a liability for payment of decree, interest, costs and expenses of $5,123.64 on the indemnifying bond given them by appellee. A jury trial resulted in a verdict directed for the defendant and judgment thereon against the plaintiffs, from which judgment this appeal is prosecuted.

Appellants argue that appellee stands in the place of Lyons and its liability to them is the same as his. But it is evident from a comparison of the language of the above quoted conditions of the two bonds that appellee undertook to restrict its liability to losses caused by the dishonesty of Lyons, and did not intend to become liable for honest erro'rs of judgment, or acts of carelessness, that appellants were clearly responsible for under the conditions of the bond executed by them.

Appellants construe the bond as an indemnity against any act of fraud, or any act of dishonesty amounting to larceny or embezzlement, thus making the words “amounting to larceny or embezzlement” qualify the word “dishonesty,” instead of the word “act.” They claim that the case of City Trust Safe Deposit & Surety Co. v. Lee, 204 Ill. 69, is decisive of the question, and quote the language of the bond in that case as “dishonesty or fraud, amounting to larceny or embezzlement,” and say the court held that the words “larceny or embezzlement” did not qualify the word “dishonesty” but did qualify the word “fraud.” Appellants ’ quotation is not from the opinion of the court. The Supreme Court did not quote the condition of the bond under consideration but said: ‘ ‘ The loss guarantied was that sustained by the appellee through the dishonesty or any act of fraud of Morrow amounting to larceny or embezzlement.” The case was heard by the Supreme Court on appeal from the Appellate Court of the First District. The opinion of the Appellate Court is reported in 107 111. App. 263, and the language in the condition of the bond is quoted on page 267, where it is said that the guaranty was against loss “sustained by- the employer by or through the dishonesty or any act of fraud of the employee amounting to larceny or embezzlement, in connection with the duties, ’ ’ etc. It will be observed that the language in the two instruments differ materially, and the construction of the clause of the bond in the Lee case, supra, does not necessarily control here. In quoting the condition of the bond in question here, we have followed the punctuation as shown by the record. It will readily be seen that if the comma be placed after the word “fraud” instead of the word “dishonesty” the meaning contended for by appellants might be more readily adopted. In the construction of contracts and other writings, piinctuation, though, not necessarily controlling, sheds light on the meaning of the parties. Osborn v. Farwell, 87 Ill. 89; Crawford v. Burke, 201 Ill. 581. The Appellate Court of the First District in American Bonding & Trust Co. v. New Amsterdam Casualty Co., 125 Ill. App. 33, had a similar question to determine. The guaranty in that case was against “any act of fraud or dishonesty amounting to larceny or embezzlement committed by the employee during the continuance of this bond.” The trial court in its instructions to the jury assumed that the words “amounting to larceny and embezzlement” did not qualify the words “any act of fraud;” doubtless, as the Appellate Court said, considering the Lee case, supra, as controlling. The Appellate Court points out the difference in the language of the, two guaranties and says that it seems clear that in the bond it was considering the words “fraud or dishonesty,” and the words “amounting to larceny or embezzlement” are both phrases qualifying the word “act.” We are of the opinion that it is clear in the case at bar that those phrases qualify the word “act”; and admitting appellants’ contention that this contract is to be liberally construed in their favor, still we must hold that there is no liability under this bond unless some act be shown that amounted to larceny or embezzlement.

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Related

Osborn v. Farwell
87 Ill. 89 (Illinois Supreme Court, 1877)
Crawford v. Burke
66 N.E. 833 (Illinois Supreme Court, 1903)
City Trust, Safe Deposit & Surety Co. v. Lee
68 N.E. 485 (Illinois Supreme Court, 1903)
Foote v. Lake County
69 N.E. 47 (Illinois Supreme Court, 1903)
Parker v. County of Richland
73 N.E. 451 (Illinois Supreme Court, 1905)
People ex rel. Abt v. Bowman
97 N.E. 304 (Illinois Supreme Court, 1911)
American Bonding & Trust Co. v. New Amsterdam Casualty Co.
125 Ill. App. 33 (Appellate Court of Illinois, 1906)
People ex rel. Rock Island County v. Lyons
168 Ill. App. 396 (Appellate Court of Illinois, 1912)

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Bluebook (online)
193 Ill. App. 193, 1915 Ill. App. LEXIS 618, Counsel Stack Legal Research, https://law.counselstack.com/opinion/allen-v-united-states-fidelity-guaranty-co-of-baltimore-illappct-1915.