American Bonding Co. v. State ex rel. Whisler

• Decision Date: 22 November 1907
• Docket Number: No. 6,089.,6,089.
• Citation: 82 N.E. 548,40 Ind.App. 559
• Parties: AMERICAN BONDING CO. et al. v. STATE ex rel. WHISLER.
• Court: Indiana Appellate Court

40 Ind.App. 559

82 N.E. 548

AMERICAN BONDING CO. et al.

v.STATE ex rel. WHISLER.

No. 6,089.

Appellate Court of Indiana, Division No. 1.

Nov. 22, 1907.

Appeal from Circuit Court, Wabash County; U. S. Lesh, Special Judge.

Action by the state, on the relation of David Whisler, as receiver, etc., against the American Bonding Company and others. From a judgment for plaintiff, defendants appeal. Reversed, with instructions to grant a venire de novo.

See 81 N. E. 1179.

Ayres, Jones & Hollett, for appellants. H. B. Shively and Frank A. Switzer, for appellee.

HADLEY, J.

This was an action brought by the state, on the relation of David Whisler, receiver of the late copartnership of Lawrence & Co., against appellants, Elizabeth H. Mills and American Bonding Company of Baltimore, for recovery upon a bond executed by the said Elizabeth H. Mills as surviving partner of the firm of Lawrence & Co., principal, and said American Bonding Company of Baltimore, as surety, for alleged breaches thereof. Upon issue joined, the cause was submitted to the court, and upon request a special finding of facts and conclusions of law were made, upon which judgment was rendered for appellee. Exceptions were reserved by each of said appellants to each of said conclusions of law. Each of said appellants then filed a separate motion for a venire de novo and a separate motion for a new trial.

It is contended that the venire de novo of appellants should have been sustained, for the reason that the special finding of facts is imperfect, indefinite, and uncertain, in that the court did not find the amount of funds of said trust with which appellant Mills should be charged. Item No. 2 of the finding shows that on April 9, 1901, she filed an inventory and appraisement of the partnership assets; that said appraisement showed the firm assets to be as follows:

+------------------------------------------------+
                ¦The stock of merchandise appraised at¦$13,823 05¦
                +-------------------------------------+----------¦
                ¦Accounts classed as good             ¦2,366 98  ¦
                +-------------------------------------+----------¦
                ¦Accounts classed as doubtful         ¦498 92    ¦
                +-------------------------------------+----------¦
                ¦Accounts classed as bad              ¦194 61    ¦
                +-------------------------------------+----------¦
                ¦Making a total of                    ¦$16,883 56¦
                +------------------------------------------------+
                

This is the only finding as to the value of the property or what she received out of the trust, except that No. 4 finds that up to February 15, 1902, she had collected of the choses in action $787.35. It is well settled that it is the province of a special finding to find the ultimate facts, and the finding of evidentiary facts is not sufficient. Minnich v. Darling et al., 8 Ind. App. 542, 36 N. E. 173;Taylor v. Canaday, 155 Ind. 675, 57 N. E. 524, 59 N. E. 20;Perkins v. Hayward et al., 124 Ind. 450, 24 N. E. 1033. The finding that the appraisement showed certain things is not a finding of an ultimate fact, but of an evidentiary fact (Hasselman v. Japanese, etc., Co., 2 Ind. App. 180, 27 N. E. 318, 28 N. E. 207), nor is it a finding that she received that amount of property; nor, in view of the other findings, necessarily a finding that she should be charged with that amount. It is true, as counsel for appellee state, that as a general rule a trustee is charged with the amount of the inventory and appraisement filed in the trust. But when, as in this case, the suit is for a breach of the bond and the other findings of the court show that the trustee was not so charged in making calculation to determine the amount converted, the rule falls, and there should be a definite finding somewhere of the amount of the partnership property she received and with which she should be charged. The court found that appellant Mills collected $787.35 of the choses in action prior to February 15, 1902, but does not find that this was the whole amount she collected or with which she should be charged. The court also found that she had expended in the performance of her trust the sum of $3,486.28, and that she had paid on the debts of the partnership out of the partnership's property $3,855.25; that she paid on partnership debts $596.90 out of an equity in lands she owned, and $828.71 out of other lands owned by Jennie C. Lawrence and Elizabeth H. Mills jointly, $17,366.62 out of the proceeds of the sale of bank stock owned by said Lawrence and Mills in their separate capacities and pledged as security for said debts, and $652.71 on another partnership debt out of the same proceeds; that she expended $800 to replenish stock; that the services of August C. Mills rendered said trust was $1,500, and then finds she converted to her own use of the trust funds $6,257.52. How did the court arrive at this amount? It is urged that this amount is excessive. How is this court to determine that fact? With which of the above amounts did the court credit her? Certainly not all; and we cannot discover any combination of the above amounts together with the amount found to have been converted that will come anywhere near to amount of the appraisement.

Counsel for appellee have endeavored to aid us in this search by suggesting that the court in its calculation deducted from the amount of her appraisement the amount of $2,273.16, the difference between the appraised amount of the choses in action and the amount of the same found to have been collected prior to February 15, 1902; and, taking the balance of the appraisement left after this deduction as the amount with which she should be charged, and grouping together certain of the above amounts as credits, thus obtained the result found. But there is no finding that such a deduction should be made, and, to obtain the basis, we must go into the field of speculation and indulge in inferences. This, under the well-settled rules of law, we cannot do. Crowder v. Riggs, 153 Ind. 158, 53 N. E. 1019;Craig v. Bennett, 146 Ind. 574, 45 N. E. 792, and cases cited. Item No. 10 of the finding is in substance as follows: That prior to the death of said Jennie C. Lawrence the partnership of Lawrence & Co. became indebted to the Lawrence National Bank and to one Susan H. Eagle in various sums, which, when paid, amounted to $17,366.62; that, when said loans were made by the said bank and the said Susan H. Eagle, there was pledged by the said Jennie C. Lawrence and the said Elizabeth H. Mills certain bank stock then held and owned by them in their individual capacities as collateral security for said loans; that in August, 1902, said bank stock so pledged with the knowledge and consent of said Elizabeth H. Mills was sold by said creditors for $18,150. The money thus received was applied to the payment of the debts so secured in the sum first above stated, and in the payment of another partnership debt of $652.71, the residue being paid to Elizabeth H. Mills. This item is indefinite and uncertain, in that it does not find in what amount each of said partners held the bank stock in question. Counsel for appellant contend that the finding that the two partners owned and held certain pledged bank stock in their individual capacities creates of necessity the presumption that they owned it jointly and equally. While it might be true that such a finding with regard to a single article of property that is indivisible, such as a house, a share of stock, or the like, this presumption would arise; yet when this language is applied to an aggregation of property such as a large number of shares of stock, such a presumption does not necessarily follow. For the foregoing reasons, the special finding must be held insufficient to support the judgment.

While this determines the case so far as this appeal is concerned, there is a question presented that will necessarily arise on another trial and should be settled at this hearing. It appears that in the performance of her trust as surviving partner appellant Mills used certain of the trust funds in her private affairs and out of her private funds paid partnership debts; and appellants insist that she should have credit for the partnership debts thus paid. Appellee contends that, since the partnership debts were also her individual obligation, when paid, they were extinguished, and that, since a partner cannot be a creditor of his own partnership, he cannot be subrogated to the rights of a creditor whose debt he had...