United States Fidelity & Guaranty Co. v. Bates

296 N.W. 560, 139 Neb. 131, 1941 Neb. LEXIS 39
CourtNebraska Supreme Court
DecidedFebruary 28, 1941
DocketNo. 30959
StatusPublished
Cited by1 cases

This text of 296 N.W. 560 (United States Fidelity & Guaranty Co. v. Bates) is published on Counsel Stack Legal Research, covering Nebraska Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
United States Fidelity & Guaranty Co. v. Bates, 296 N.W. 560, 139 Neb. 131, 1941 Neb. LEXIS 39 (Neb. 1941).

Opinion

Yeager, J.

This is an action by plaintiff, appellee here, against the defendant, appellant here, to recover on an indemnity agreement or agreements for loss claimed to have been sustained by appellee by reason of the fact that appellee claims that it was required to respond in the principal sum of $1,250 indemnity as surety on the bond of Merton O. Bates, county judge of Dawson county, the appellant, and was required to expend the sum of $257.80 for legal services, and $14.16 court costs, in an action against the appellant and appellee, the purpose of which was to recover for default on' the part of the said Merton O. Bates as county judge in the sum of $2,000.

The facts are not in dispute in any substantial particular. Appellant was county judge of Dawson county for two terms. His first term began in January, 1925, and ended in January, 1929. The second term began at the expiration of the first and ended in January, 1933. As county judge appellant was required to furnish bond with sufficient surety thereon. The appellee was surety on the bond for the first term and also for the second term. Prior to the execution and delivery of the bond for the term beginning in January, 1925, appellant executed an application wherein he agreed to indemnify and keep indemnified the appellee from and against any and all loss, costs, charges, suits, damages, counsel fees and expenses of whatever kind or nature which the appellee should or might for any cause at any [134]*134time sustain, or incur, or be put to, for or by reason or in consequence of having entered into or executed the said bond. A like agreement was entered into prior to the execution of the bond for the second term of office.

During the first term of Merton O. Bates as county judge the matter of the estate of Charlotte B. Walker was pending in the county court of Dawson county. It became necessary to sell real estate belonging to the estate in order to pay the costs of administration and debts. License was obtained from the district court to sell the real estate which was the homestead of the deceased, Charlotte B. Walker.

The deceased, Charlotte B. Walker, left surviving her husband, William P. Walker, and several children; hence, there was a homestead exemption of $2,000 necessary to be set off out of the proceeds of sale of real estate to the surviving husband.

After sale the administrator made his report of sale to the county court, whereupon appellant as county judge ordered that $2,000 be paid into the county court, the said $2,000 being the homestead right of William P. Walker, there to be held during the lifetime of the said William P. Walker, and that interest should be paid thereon semiannually as earned. The order further provided that on the death of William P. Walker, the $2,000 with interest, if any, should be paid over to the children, heirs at law or legal representatives of Charlotte B. Walker named in her will. In the same order the accounts of the administrator were approved and the estate was closed.

The money in conformity with the order was paid into the county court by the administrator. Bates, county judge, placed the money in a bank and took certificates of deposit for the same, which certificates were, from time to time, turned in and marked paid, whereupon new ones were issued to him. The last one, representing the entire sum, was issued during the last term of office of Bates.

Some time after the expiration of the second term of Bates, William P. Walker died and the heirs of Charlotte B. Walker brought suit against appellant and appellee on the [135]*135bond hereinbefore mentioned on account of the failure of appellant to pay over to them the $2,000. The bank in which Bates had placed the money had failed and he was unable on that account to obtain the money from the bank.

The appellee herein in that case by stipulation agreed to a judgment against itself for $1,250 in full settlement of the claim for $2,000, which judgment was paid. Judgment was not taken against appellant.

This action is to recover back from the appellant under the indemnity agreement or agreements the $1,250, together with attorney’s fees, court costs and accrued interest.

The case was tried to a jury, and at the conclusion of the evidence, on motion of plaintiff, the court instructed the jury to return a verdict in favor of plaintiff and against the defendant. A verdict was returned in conformity with the instruction. Judgment was entered on the verdict. Motion for new trial was duly made and overruled. From this judgment and the rulings of the court defendant appealed.

Appellant sets forth several grounds of error, but they do not call for separate discussion. An analysis of the record causes us to conclude that but two propositions require consideration.

First, appellant contends that the suit should have been instituted, if ground of action existed, on the bond for the first term of office rather than the one for the second term, since the loss occurred during the first term.

This contention of appellant is not tenable. This court determined adversely to appellant on this question in the recent case of Thurston County v. Chmelka, 138 Neb. 696, 294 N. W. 857. In this opinion other cases on this subject are collected. In this case the court said:

“When an officer, charged with the custody of public funds, serves successive terms, the sureties upon the bond for the second term become prima facie responsible for such balance of the previous account as is chargeable to their principal, the presumption being that the officer has received in his new official capacity that which it was his [136]*136duty to pay in his old, and that he has on hand all the funds with which he is chargeable.”

In the case at bar there is no evidence to rebut the presumption that Bates received in his new term the $2,000 in question which had come into his hands during the old. In fact the evidence shows that the last certificate of deposit representing the $2,000 was issued to appellant on May 1, 1929, which was approximately four months after the commencement of appellant’s second term of office.

The second proposition is the one requiring a determination of whether or not the $2,000 was received by appellant by virtue of his office, or ex officio, since the obligation of the bonds signed by the appellee herein was for the purpose of guaranteeing that Bates, as county judge, would pay over to the party or parties entitled thereto, or his successor in office, all money coming into his hands by virtue of his office. Appellant contends that he did not receive the money by virtue of his office.

If the money in question herein was not received by appellant by virtue of his office there was no liability on the bonds signed by the appellee. A long line of decisions holds that sureties on. official bonds do- not undertake to answer for acts done by their principal under color of office, but only for acts done by virtue of office. Huffman v. Koppelkom, 8 Neb. 344; Ottenstein v. Alpaugh, 9 Neb. 237, 2 N. W. 219; State v. Moore, 56 Neb. 82, 76 N. W. 474; State v. Porter, 69 Neb. 203, 95 N. W. 769; Snyder v. Gross, 69 Neb. 340, 95 N. W. 636; Stephens v. Hendee, 80 Neb. 754, 115 N. W. 283.

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Bluebook (online)
296 N.W. 560, 139 Neb. 131, 1941 Neb. LEXIS 39, Counsel Stack Legal Research, https://law.counselstack.com/opinion/united-states-fidelity-guaranty-co-v-bates-neb-1941.