Western Surety Co. v. Keeley

27 S.D. 465
CourtSouth Dakota Supreme Court
DecidedJune 6, 1911
StatusPublished
Cited by2 cases

This text of 27 S.D. 465 (Western Surety Co. v. Keeley) 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
Western Surety Co. v. Keeley, 27 S.D. 465 (S.D. 1911).

Opinion

SMITH, P. J.

This action was tried to the court without a jury, and judgment entered upon findings of fact and conclusions of law.. The assignments of error relate to conclusions of law upon facts which are undisputed. Briefly stated, the facts are as follows:

On November 6, 1906, an information was filed by the state’s attorney in the circuit court of Davison county, charging one Myrtle Kelley with the crime of keeping a house of ill fame, upon which charge she was arrested and admitted to bail in the sum of $1,000. On the 9th day of .February, 1907, the defendant, being then in custody upon said charge, made application to the plaintiff company to become surety upon her bail bond. At the same time there was presented to the plaintiff company a bond of indemnity signed by the defendants in this action, five in number, each bondsman binding himself severally in the sum of $200 to> indemnify the plaintiff company “if the said Western Surety Company is compelled or becomes liable under said bail bond by the default of said Myrtle Kelley to appear at said circuit court of Davison county and answer the charges made against her and all orders of the said circuit court in all things in said action.” Thereafter, on the 21st day of February, 1907, to induce the plaintiff surety company to' become surety on her bail bond, defendants in this action executed and delivered to plaintiff a further agreement in writing, whereby the indemnity bond theretofore executed by them was amended by striking out the limitation of a several liability in the sum of $200 each, and .making the bondsmen jointly and severally liable in the full sum of $1,000, “as though no such provision was contained in the bond.” Thereafter, on the 22cl day of February, 1907, the plaintiff surety company, relying upon the bond of indemnity executed and delivered an undertaking or bail bond with Myrtle Kelley as principal in the sum of $1,000 conditioned for her appearance before' the circuit court which undertaking was duly approved and filed on February [468]*46822, 1907, and' thereupon' said Myrtle Kelley was released from custody. Thereafter, for reasons not material upon this appeal, the cause was continued to the April, 1908, term of court, at which time the accused failed to appear, and the undertaking of bail was declared forfeited. On May 14, 1909, an action was commenced in the circuit court of Davison county against Myrtle Kelley and the Western Surety Company te» recover the sum of $1,000, the amount of the forfeited undertaking, and on May 27, 1909, plaintiff surety company served on defendants in this action as sureties on the indemnity bond notice of the beginning of the action on the forfeited bail bond, and that “the Western Surety Company desires you to take charge of the defense in this action and plead thereto any defense you may have which could be interposed by the Western Surety Company,” and, further, “that if you fail so to do successfully, and judgment is rendered against the Western Surety Company, the Western Surety Company will require you jointly and severally to reimburse it for the amount of such judgment and any and all costs which it may incur in the premises,” and, further, that “the said Western Surety Company will furnish any assistance in its power to you in the defense of said action, and will co-operate with you in the defense thereof.” The defendants in this action neglected and refused to defend the action on the undertaking, and allowed judgment to be taken therein against the surety company, in settlement of which judgment the company on October 12, 1909, paid the sum of $1,035.05, and began this action against these defendants on the indemnity bond. Defendants, appellants here, urge two lines of defense: First, that the indemnity bond was without consideration because at the time it was, executed on February 9, 1908, no undertaking had been given by the Western .Surety Company, and that an indemnity bond ag'ain'st liablity on an undertaking given in a criminal action is against public policy and void; second, that prior to the forfeiture of the undertaking and the action thereon Myrtle Kelley had been taken into custody under an order of the circuit court of Davison county, and the surety company deprived of its right under the statute to take her into'custody, and that the [469]*469surety company was thereby released from liability on its undertaking of bail.

[1] Appellants contention that the bond of indemnity was without consideration because made prior to the execution of the undertaking of bail by the Western Surety Company is wholly without merit. It is apparent that the giving of this indemnity bond by defendants was in part at least the inducement accepted by the surety company as a consideration for assuming liability upon the bail bond of the accused. Appellants’ argument fails to observe the distinction between contracts of indemnity and contracts of guaranty or suretyship. A contract of guaranty or suretyship is in a sense collateral to a principal existing contract, while a contract of indemnity is an independent contract to save another from loss upon some obligation which he has already incurred or is about to incur to a third person. 22 Cyc. 80.

[2] Nor are appellants in this case in position to urge that at the time they signed the indemnity contract the undertaking of the Western Surety Company had not been executed, and was not in existence. The indemnity contract itself assumed and recognized the existence of the undertaking of bail on the part of the Western Surety Company, and appellants are estopped from denying its existence. In 22 Cyc. 93, it is said: “The general rule that, if in making a contract the parties agree upon or assume the existence of a particular fact as the basis of their negotiations, they are estopped to deny the fact so long as the contract exists, is applicable to contracts of indemnity.”

[3] Appellants’ further contention that a bond of indemnity against liability on an undertaking given in a criminal action is void as against public policy cannot be sustained. This precise question was before the Court of Appeals of New York in Moloney v. Nelson, 158 N. Y. 351, 53 N. E. 31, under statutes similar to section 590, Code-of 'Criminal Procedure of this state, which reads: “A deposit of the sum of money mentioned -in the order admitting to bail is equivalent to bail, and upon such deposit the defendant must be discharged from custody.” The court there says: “It is true that in some other jurisdictions, as is pointed [470]*470out in the very careful opinion of the Appellate Division, it has been suggested, if not decided, that it is against public policy to allow bail to become indemnified, the reason given being that the object for which the bail is required is to assure the appearance of the prisoner to answer the charge against him, and that necessarily the bail had a direct pecuniary interest in preventing the escape of the prisoner, which he would not have were he fully indemnified. That is not the public policy of this state; for the giving of bail in criminal cases is regulated by statute, and the Legislature has, by its provisions, provided that a personally responsible surety may be altogether omitted if the accused prefers to make a deposit of money. He may have his choice either to give a bond with sureties, or make a deposit of money. It is the loss of the money deposited, or the assurance that the sureties will be obliged to pay the amount of the bail, that is relied upon to secure the presence of the accused.

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Bluebook (online)
27 S.D. 465, Counsel Stack Legal Research, https://law.counselstack.com/opinion/western-surety-co-v-keeley-sd-1911.