Britton v. City of Fort Worth

14 S.W. 585, 78 Tex. 227, 1890 Tex. LEXIS 1375
CourtTexas Supreme Court
DecidedOctober 21, 1890
DocketNo. 3162
StatusPublished

This text of 14 S.W. 585 (Britton v. City of Fort Worth) is published on Counsel Stack Legal Research, covering Texas Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Britton v. City of Fort Worth, 14 S.W. 585, 78 Tex. 227, 1890 Tex. LEXIS 1375 (Tex. 1890).

Opinion

HENRY, Associate Justice.

This suit was brought by the city of Fort Worth to recover money charged to have been received by John Nichols as treasurer of said city and misapplied by him.

Nichols qualified as treasurer on the 6th day of April, 1883, and his first term of office expired on the 21st day of April, 1885, at which time he was re-elected treasurer and gave a new bond. He died in August, 1885. Appellants were sureties upon his first bond.

We copy the following statement of the pleadings of the defendants from the brief of appellants’ attorneys filed in this court:

“Defendants all answered by filing general demurrer and general denial, and appellants filed the following special plea, to-wit: And now come all the defendants herein, and for further answer say that on, to-wit, the-day of March, 1884, the said John Nichols, being then treasurer of the city of Fort Worth, and defendants being then his sureties, made his annual report as he was legally bound to do, wherein he gave a statement of the sums received and paid out by him as such treas[230]*230urer of the city’s moneys, and the amount of such money remaining in his. hands at the time of filing said report. That the city council of said city,, by their agents duly appointed and authorized, examined said report and the state of said Nichols’ account as such treasurer, and thereupon said city, by its council sitting and acting as such and having authority so to-do, accepted and approved said report and settled with said Nichols in full for the year preceding the date of filing said report; and by such acceptance and settlement the said council acknowledged and published that at-the date of said settlement the said Nichols was not a defaulter,"and was. not indebted to the said city in any sum, and that the said Nichols in fact had in his hands the amount of money belonging to said city as represented in said report. That afterwards on, to-wit, the 6th day of March, 1885, the said Nichols filed his annual amended report showing the condition of his accounts with said city and the amount of money in his hands belonging to said city, the amount as therein shown being all that the said Nichols was owing to said city according to said report; and the said city did then and there, through its agents duly appointed for said purpose, examine said report and the state of said Nichols’ account as such treasurer, and thereupon said city council, sitting and acting as such and having authority so to do, accepted and approved said report and made a full. settlement with said Nichols as treasurer up to said-day of March, 1885; and by such settlement these defendants aver that the said city acknowledged, agreed, and published that the said Nichols was not a defaulter, and was not indebted to said city in any sum, and had then in his. hands as treasurer the full amount shown in his said report.

“ That the city council of said city had the right, power, and opportunity, and it was its legal duty directly or through its agents, to examine into the accounts of said Nichols as aforesaid to see if they were correct, and if the said Nichols had the sums in his hands belonging to said city as shown in said report, and had full power and authority under the law to make settlement with said treasurer on plaintiff’s behalf. That these-defendants had not the means nor the opportunity to examine into the said Nichols’ accounts and finances to ascertain what sums he in fact might have on hand belonging to said city, but were compelled to trust to the said city in conducting such settlement with said treasurer to make all necessary investigation, and the right to rely on said city, and did sorely upon it for such purpose; and when the said city council made the settlements aforesaid with said treasurer these defendants had the right-to believe and did believe that such settlements were final and correct, and that they were discharged from all liability on his said bond up to the-date of said settlement last mentioned.

“Defendants further aver that after the settlements aforesaid between the plaintiff and the said treasurer Nichols on, to-wit, the 10th day of April, 1885, the said Nichols was re-elected treasurer of said city of Fort. [231]*231Worth, and filed his bond and was duly installed into office; that the city council of said city accepted the bond of said Nichols for said new term as treasurer, and permitted him to enter upon and discharge the duties of • treasurer of said city for said second term until on, to-wit, the 19th day of August, 1885, when Nichols died; and then only did plaintiff pretend to have discovered the conversions and embezzlements and indebtedness of the said Nichols as charged in plaintiff’s petition. That the said Nichols at the time of his death was insolvent, but at the time when the aforesaid settlements were made the said Nichols was solvent and' had property out of which defendants could and would have secured and indemnified themselves if they had known or been informed of the existence of any defalcation or misappropriation of moneys belonging to plaintiff as charged in plaintiff’s petition. Defendants further say that within a few days after the settlement hereinabove set forth, to-wit, on the 14th day of April, 1885, the said Nichols’ term of office expired as treasurer of said city, and the said Nichols having been re-elected to the same office gave his bond for said new term, which was then accepted and approved by said council; thereupon the liability of these defendants ceased, and defendants aver that there were no defalcations by said Nichols whatever after said settlement and before the date of said new bond. These defendants aver that now should plaintiff recover against them on said bond they would be wholly remediless, and that such a recovery would be a practical fraud on their rights; wherefore they pray that plaintiff be estopped from further pursuing its suit against these defendants; and defendants pray for all the relief to which they may be entitled in the premises.”

The court sustained an exception to this plea, and appellants complain of the ruling. We think the exception was properly sustained. It was incumbent upon the sureties to keep a watch upon their principal for the protection of the city, rather than the duty of the city to keep such watch on its treasurer for the benefit of his sureties.

We do not think that the approval by the city of the treasurer’s reports amounted to an assertion that the treasurer actually held in his handsthe money so appearing by the reports.

The verdict of the jury was for $9000 principal and $2096 interest. The statement made from the books showed that the total amount of the unexpended balance in the hands of the treasurer on the 20th day of April, 1885, was $23,299.33, of which $10,417.29 belonged to the school fund. But the evidence indicates that before the last mentioned date the treasurer had paid out on account of the school fund the sum of $8966.73, for which he had not been credited on the books. The last amount being deducted left his total deficiency $14,332.60, of which the deficiency to the school fund was the sum of $1450.56.

It was conceded that the sureties upon the bond in suit were not liable for the school fund. Broad v. The City of Paris, 66 Texas, 119. The [232]*232money received by the treasurer was kept in one mass and there was no means of distinguishing to what particular fund any part of it belonged.

• The record contains evidence of the misapplication of $10,070 by the treasurer previous to the 20th day of April, 1885.

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Related

Broad v. City of Paris
18 S.W. 342 (Texas Supreme Court, 1886)

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Bluebook (online)
14 S.W. 585, 78 Tex. 227, 1890 Tex. LEXIS 1375, Counsel Stack Legal Research, https://law.counselstack.com/opinion/britton-v-city-of-fort-worth-tex-1890.