Farmers Elevator Co. v. Swanson

South Dakota Supreme Court

Farmers Elevator Co. v. Swanson

146 N.W. 586, 33 S.D. 377, 1914 S.D. LEXIS 43

CourtSouth Dakota Supreme Court

DecidedMarch 21, 1914

StatusPublished

Cited by1 cases

This text of 146 N.W. 586 (Farmers Elevator Co. v. Swanson) is published on Counsel Stack Legal Research, covering South Dakota Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook

Farmers Elevator Co. v. Swanson, 146 N.W. 586, 33 S.D. 377, 1914 S.D. LEXIS 43 (S.D. 1914).

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Opinion

McCOY, J.

It appears from the record that about the month of May, 1909, appellant F. M. Swanson was employed by respondent as manager and grain 'buyer at its elevator at Waverly, and that as a part of the contract of employment the said F. M. Swanson was required to and did give and enter into1 a ■bond, with appellants Frank A. Swanson, Neilson, and Meyers as sureties, conditioned, -among other things, that if said Swanson well and faithfully discharged his duties as such manager and grain buyer, and should account for all grain which might come into his possession' in such elevator, weighed in.and weighed out, less reasonable shrinkage, and account for all moneys which might come into his hands belonging to said elevator company, then such obligation should become null and void; otherwise, [379]*379to remain in full force and virtue. It is conceded by the parties hereto that said Swanson, as such manager and grain buyer, dealt in what is designated “options” with certain commission firms, and that' such “option” transactions resulted in a net loss to said elevator company of $980. Plaintiff, who' is respondent here, instituted this action against Swanson and his said sureties to recover such loss, basing its claim to recover upon a breach of the conditions of said bond There was a verdict and judgment for plaintiff, and defendants appeal.

[1] 'The vital question for consideration is whether or not said dealings in “options” by said Swanson were in violation of his duties as such manager and grain buyer. Appellants contend that Swanson was authorized by plaintiff to deal in such “options” as a part of his duties; and this is denied by plaintiff, who contends that Swanson was expressly prohibited from engaging in such transactions. This was one of the disputed questions of fact at issue, and on which question there was material conflict in the testimony. We are of the opinion that there was ample evidence submitted by plaintiff to support the verdict of the jury.

[2] The contract of employment was oral, and ¡the duties of such manager and grain buyer were such as might be prescribed or required by the board of directors of respondent. At the time Swanson was employed, a resolution was passed relating to his duties, which, among other things, provided that “dealings in options detrimental .to the business of the elevator company would not be permitted;” but the board of directors at a subsequent meeting amended this part of the 3 esolution, so as to read “dealings in options is prohibited.” The members of the board of directors, and the clerk thereof, tejtified that Swanson was immediately notified of this amendment, and long prior to his engaging in any of said option deals. For the purposes of this appeal, this testimony of the board of directors, and the clerk thereof, must be taken as true.

[3] Under these circumstances, we are of the view that Swanson was not authorized to engage in option dealings for and on behalf of the elevator company, and that his doing so was a violation of, and a failure to well and faithfully discharge, his duties as such manager and grain, buyer, and that the [380]*380taking of the moneys and grain of respondent to' settle the losses occasioned by such option dealings was -a misappropriation of said moneys and grain, and in violation of the terms of said bon'd), and a 'breach thereof, for which Swanson and his said sureties became liable. He could not thus account for - the grain and moneys of respondent.

Many assignments of error are presented relating to the reception or rejection of evidence, instructions of the court, motions to strike testimony, or motions for directions of verdict; but they are all based upon the crucial question of whether or not Swanson was authorized to engage in such option dealings. All these assignments have been considered, and we are of the view that no prejudicial error exists -therein.

The judgment and order appealed from are affirmed.

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McCOY, J.

It appears from the record that about the month of May, 1909, appellant F. M. Swanson was employed by respondent as manager and grain 'buyer at its elevator at Waverly, and that as a part of the contract of employment the said F. M. Swanson was required to and did give and enter into1 a ■bond, with appellants Frank A. Swanson, Neilson, and Meyers as sureties, conditioned, -among other things, that if said Swanson well and faithfully discharged his duties as such manager and grain buyer, and should account for all grain which might come into his possession' in such elevator, weighed in.and weighed out, less reasonable shrinkage, and account for all moneys which might come into his hands belonging to said elevator company, then such obligation should become null and void; otherwise, [379]*379to remain in full force and virtue. It is conceded by the parties hereto that said Swanson, as such manager and grain buyer, dealt in what is designated “options” with certain commission firms, and that' such “option” transactions resulted in a net loss to said elevator company of $980. Plaintiff, who' is respondent here, instituted this action against Swanson and his said sureties to recover such loss, basing its claim to recover upon a breach of the conditions of said bond There was a verdict and judgment for plaintiff, and defendants appeal.

[1] 'The vital question for consideration is whether or not said dealings in “options” by said Swanson were in violation of his duties as such manager and grain buyer. Appellants contend that Swanson was authorized by plaintiff to deal in such “options” as a part of his duties; and this is denied by plaintiff, who contends that Swanson was expressly prohibited from engaging in such transactions. This was one of the disputed questions of fact at issue, and on which question there was material conflict in the testimony. We are of the opinion that there was ample evidence submitted by plaintiff to support the verdict of the jury.

[2] The contract of employment was oral, and ¡the duties of such manager and grain buyer were such as might be prescribed or required by the board of directors of respondent. At the time Swanson was employed, a resolution was passed relating to his duties, which, among other things, provided that “dealings in options detrimental .to the business of the elevator company would not be permitted;” but the board of directors at a subsequent meeting amended this part of the 3 esolution, so as to read “dealings in options is prohibited.” The members of the board of directors, and the clerk thereof, tejtified that Swanson was immediately notified of this amendment, and long prior to his engaging in any of said option deals. For the purposes of this appeal, this testimony of the board of directors, and the clerk thereof, must be taken as true.

[3] Under these circumstances, we are of the view that Swanson was not authorized to engage in option dealings for and on behalf of the elevator company, and that his doing so was a violation of, and a failure to well and faithfully discharge, his duties as such manager and grain, buyer, and that the [380]*380taking of the moneys and grain of respondent to' settle the losses occasioned by such option dealings was -a misappropriation of said moneys and grain, and in violation of the terms of said bon'd), and a 'breach thereof, for which Swanson and his said sureties became liable. He could not thus account for - the grain and moneys of respondent.

Many assignments of error are presented relating to the reception or rejection of evidence, instructions of the court, motions to strike testimony, or motions for directions of verdict; but they are all based upon the crucial question of whether or not Swanson was authorized to engage in such option dealings. All these assignments have been considered, and we are of the view that no prejudicial error exists -therein.

The judgment and order appealed from are affirmed.

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146 N.W. 586, 33 S.D. 377, 1914 S.D. LEXIS 43, Counsel Stack Legal Research, https://law.counselstack.com/opinion/farmers-elevator-co-v-swanson-sd-1914.

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