Home Bldg. & Sav. Ass'n v. New Amsterdam Casualty Co.

• Decision Date: 15 December 1930
• Docket Number: No. 8722.,8722.
• Citation: 45 F.2d 989
• Parties: HOME BLDG. & SAV. ASS'N v. NEW AMSTERDAM CASUALTY CO.
• Court: U.S. Court of Appeals — Eighth Circuit

45 F.2d 989 (1930)

HOME BLDG. & SAV. ASS'N v. NEW AMSTERDAM CASUALTY CO.

No. 8722.

Circuit Court of Appeals, Eighth Circuit.

December 15, 1930.

J. R. Bush, of Prescott, Ark. (John D. Arbuckle, of Ft. Smith, Ark., on the brief), for appellant.

Cecil R. Warner, of Ft. Smith, Ark. (Garner W. Denmead, of Baltimore, Md., Buzbee, Pugh & Harrison, of Little Rock, Ark., and Harry P. Warner, of Ft. Smith, Ark., on the brief), for appellee.

Before STONE and VAN VALKENBURGH, Circuit Judges, and OTIS, District Judge.

VAN VALKENBURGH, Circuit Judge.

Appellant is an Arkansas corporation with its principal place of business at the city of Ft. Smith in said state. It appointed one Dan Dewberry local agent at Texarkana, Ark., and December 14, 1925, appellee, issued to appellant a surety bond, whereby it undertook to reimburse appellant to the extent of $5,000 on account of any pecuniary loss appellant might sustain because of any act of larceny or embezzlement on the part of such employee. The bond in question contained the following provision:

"That the Employer, on his becoming aware of any act which may be made the basis of any claim hereunder, shall immediately give the Company notice thereof in writing, by a registered letter, addressed to the President of the Company, Baltimore, Maryland, and shall, within ninety days after his becoming aware of such fact as aforesaid, file with the Company his itemized claim hereunder at his own cost and expense with full particulars thereof duly sworn to; and, if required, the Employer shall also produce in support thereof for investigation by the Company or its representatives at the office of the Employer all appropriate books, vouchers and evidence as may be required by the Company; and this bond shall become void both as to any existing or future liabilities thereunder unless the aforesaid notice shall have been given as provided for, and unless claim is filed within the time and manner above specified, and until such books, vouchers and evidence (if required) have been furnished to the Company for investigation as above stated; Provided, that no claim shall be payable hereunder that shall be filed with the Company after the period of six months from the expiration or cancellation of this Bond, or after a period of six months from the death, resignation or removal of the Employee occurring prior to the expiration or cancellation of this Bond."

This bond expired by its terms December 1, 1926. April 11, 1927, appellant, through its secretary and auditor, T. R. Bishop, sent to appellee the following letter:

"April 11, 1927. "New Amsterdam Casualty Co., Baltimore Md., 227 St. Paul St.

"Gentlemen: This is to advise you that the Home Building & Savings Association of Ft. Smith, Arkansas, holds surety bond number 315858 issued in its favor in behalf of Dan Dewberry of Texarkana, Arkansas, on December 1st, 1925, and which bond expired on the 1st day of December, 1926.

"It now appears that there exists a considerable shortage by Mr. Dewberry to the above mentioned company, and that said shortage occurred during the life of this bond.

"We are giving you this notice and just as soon as our findings are complete we shall submit full report to you.

"Very truly yours "Auditor, Home Building &amp Savings Association. "CC — E. L. Darr, 805 Boyle Bldg "Little Rock, Ark."

To this appellant, April 16, 1927, made the following reply:

"Mr. J. R. Bishop, Auditor, Home Building & Savings Association, Fort Smith Arkansas.

"Dear Sir: We acknowledge receipt of your letter of April 11, 1927, reporting an apparent claim against Dan Dewberry, local agent at Texarkana, for the Home Building & Savings Association of Fort Smith, Arkansas.

"We note that a full report will be submitted as soon as you have completed your investigation and that you have been in touch with Mr. E. L. Darr, our Branch Manager at Little Rock. We have instructed Mr. Darr to co-operate with you and to furnish you the necessary claim papers at the proper time."

Thereafter there was no communication between the parties until August 20, 1927, when appellant wrote appellee's agent Darr, demanding payment on the bond. No itemized claim was sent to appellee, or any of its representatives, within ninety days from April 11, 1927, nor at any other time. This letter of August 20, 1927, was sent nearly nine months after the expiration of the bond. Appellee refused payment upon the ground that the provisions of the bond above set out had not been observed by appellant.

December 15, 1928, appellant filed in the state court this suit, subsequently removed to the United States District Court for the Western District of Arkansas because of diversity of citizenship. A jury was waived by written stipulation. The court, sitting as a jury, made findings of fact and conclusions of law, found the issues for appellee, and entered judgment accordingly.

It is beyond dispute that appellant failed to observe the unambiguous provisions of the bond in the following particulars:

1. It did not, within ninety days after becoming aware of the acts which it made the basis of its demand, file with appellee its itemized claim duly sworn to, and

2. It filed no claim of any...