Fogleman v. National Surety Co.

132 So. 317, 222 Ala. 265, 1931 Ala. LEXIS 381
CourtSupreme Court of Alabama
DecidedJanuary 22, 1931
Docket3 Div. 925.
StatusPublished
Cited by22 cases

This text of 132 So. 317 (Fogleman v. National Surety Co.) is published on Counsel Stack Legal Research, covering Supreme Court of Alabama primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Fogleman v. National Surety Co., 132 So. 317, 222 Ala. 265, 1931 Ala. LEXIS 381 (Ala. 1931).

Opinion

*267 FOSTER, J.

In our recent case of Ex parte Green, 221 Ala. 415, 129 So. 69, we had before us for review by mandamus the propriety of an order consolidating suits in equity. We there approved that method o'f review, and referred to the fact that no appeal is provided from such an order. The order of consolidation in this case is a part of a decree sustaining demurrers to the several bills of complaint, and it is to that extent assigned as error. This court has held that a decree from which no appeal may be taken because the time has expired may not be assigned as error on an appeal taken from another interlocutory decree, which will support an appeal, Kyser v. American Surety Co., 213 Ala. 614, 105 So. 689; Lewis v. Martin, 210 Ala. 401, 98 So. 635 (9); though it may be assigned for error on appeal from the final decree, section 6079, Code. For like reason, if no provision is made by law for an appeal from an interlocutory decree, such decree may not be assigned for error on an appeal from another interlocutory decree. We cannot therefore consider such assignment of error, and express no opinion on the propriety of the order of consolidation. But, in this connection, we refer to our case of Ex parte Green, supra, and 1 Corpus Juris, 1128.

The equity of the bills of complaint separately considered is that complainants in each of them and others similarly situated have sustained loss as the proximate result of the breach by J. E. Duskin, Jr., of his successive official bonds as a notary public, in excess of the penalty of the respective bonds, and seek to have the court ascertain the amount due each, and prorate the amount of the liability on each bond among them pur-, suant to the amount of the loss each has sustained.

This aspect of the equity of the bills is not questioned by appellees, and is supported by our case of National Surety Co. v. Graves, 211 Ala. 533, 101 So. 190. But the contention is that the allegations of the bills do not show any liability against the sureties on the-bonds for the breach of a duty imposed bylaw or its terms. This view was entertained' by the circuit court, and it is the principal question argued in this Court,

In our case of American Surety Co. v. First Nat Bank, 203 Ala. 179, 82 So. 429, 430, there is asserted principles which are supported by the great weight of authority to the effect that, when the claim is that plaintiff has sustained damages as the proximate result of the fraudulent act of a notary public in falsely certifying an acknowledgment to a mortgage whose execution he had also forged, the true inquiry should be: “Is the plaintiff in this case connected with such official act of making a false certificate of acknowledgment to the mortgage, by estate or interest, as to bring it within the protection of the statute? [Section 2612, Code], If' not, then, of course, it cannot maintain .this action; if so, it can.” In that case the notary had sent to one bank the check of the mortgagee payable to the fictitious mortgagor on another bank, with a forged indorsement, and procured the former bank to indorse it for collection from the payee bank, and thereby caused a loss by the former bank on account of the forged and fictitious indorsement. It was held that the proximate cause of such loss to the bank was the act of this notary as an individual and not an officer in forging the indorsement on the check inducing the bank to act upon it. The bank was in no way connected with the official conduct of the notary, and its loss was not the proximate, but the remote, result of such official misconduct Of a similar nature is the recent case of State ex rel. v. Globe Indemnity Co., 220 Mo. App. 918, 9 S.W.(2d) 668.

There. is nothing we observe here which would militate against the contention that, if the mortgagee parted with funds as the direct and proximate result of such fraudulent official conduct, he could recover on the bond. In fact the opinion shows that such is the true rule. Since that opinion was written the subject has been treated in three separate annotations in A. L. R. supplementing each other, as follows: 18 A. L. R. 1304; 31 A. L. R. 920; 61 A. L. R. 808. Some of the cases cited are noted below, and they are generally to the effect that, where the mortgagee pays out his money upon the faith of the truth of the certificate and sustains loss, the loss is the proximate result of the act of the notary *268 done under color of his office. State ex rel. v. Ogden, 187 Mo. App. 39, 172 S. W. 1172; People, etc., v. Butler, 74 Mich. 643, 42 N. W. 273; State ex rel. v. Am. Surety Co. (Mo. App.) 254 S. W. 561; State ex rel. v. Korte (Mo. App.) 13 S.W.(2d) 558; Governor of Wisconsin ex rel. v. Maryland Casualty Co., 192 Wis. 472, 213 N. W. 287, 51 A. L. R. 1478; State ex rel. v. Globe Indemnity Co., 222 Mo. App. 153, 2 S.W.(2d) 815: State ex rel. v. Otto, 220 Mo. App. 429, 276 S. W. 96; Ætna Cas. Co. v. Commonwealth, 233 Ky. 142, 25 S.W.(2d) 51. Many others are shown in the annotations above.

Undoubtedly the loss must be the proximate result of the official misconduct of the officer to create a liability against his official bond. The authorities all agree on this point. But there is a supposed conflict among them as to the effect and meaning of that conclusion.

The case of Governor of Wis. v. Maryland Casualty Co., 192 Wis. 472, 213 N. W. 287, 289, 51 A. L. R. 1478, has emphasized the idea that such proximate result cannot include the consequences of the personal conduct of the officer. So that, had the mortgage been properly acknowledged as certified, it would not have furnished adequate security, and “a true certificate would not have saved the plaintiff from her loss,” “the plaintiff is not entitled to recover any more than her loss, by reason of said certificates being false instead of true,” and “if the mortgages had been valid in every respect their value as securities would have depended upon the value of the mortgaged property,”—citing Heidt v. Minor, 89 Cal. 115, 26 P. 627, 629; McAllister v. Clement, 75 Cal. 182, 16 P. 775.

Whereas it is claimed that the reasoning in another line of cases leads to a different result. Their argument follows from the well-understood principle which declares that the false-certificate need only be one of the proximate contributing causes of a result to create ,a liability for that result. It is argued, therefore, -that, if the result is caused by the concurring causes of the individual misconduct of the officer in presenting to the mortgagee a mortgage on worthless property, or on some not in existence or not owned by the mortgagor, and the official misconduct of the officer in falsely certifying to an acknowledgment of the mortgagors, the total loss may be recovered, though due to such combined causes. State v. Hallen (Mo. App.) 196 S. W. 1067; State v. Otto, 220 Mo. App. 429, 276 S. W. 96; State v. Ogden, 187 Mo. App. 39, 172 S. W. 1172; State v. Am. Surety Co. (Mo. App.) 254 S. W. 561. To sustain this conclusion, it is argued in one of the eases that the fálse certificate was one of the conditions on which reliance is placed, and without it there would have been no loss.

But we think that we can accept the theory that, if reliance on the false certificate is one of the proximate contributing causes, a recovery may be had without going the full length of some of the cases last cited, in finding the result of that theory.

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132 So. 317, 222 Ala. 265, 1931 Ala. LEXIS 381, Counsel Stack Legal Research, https://law.counselstack.com/opinion/fogleman-v-national-surety-co-ala-1931.