Bolton v. City of De Leon

• Decision Date: 26 March 1926
• Docket Number: (No. 125.)
• Citation: 283 S.W. 213
• Parties: BOLTON et al. v. CITY OF DE LEON.
• Court: Texas Court of Appeals

283 S.W. 213

BOLTON et al. v. CITY OF DE LEON.

(No. 125.)

Court of Civil Appeals of Texas. Eastland.

March 26, 1926.

Appeal from District Court, Comanche County; Joe H. Edison, Judge.

Suit by the City of De Leon against William D. Bolton and others. Judgment for plaintiff, and defendants appeal. Reformed and affirmed.

Callaway & Callaway, of Comanche, George E. Shelley, of Austin, and C. L. Stone, Asst. Atty. Gen., for appellants.

George E. Smith, of Comanche, and Clyde Hampton, of De Leon, for appellee.

RIDGELL, J.

We adopt the statement of the nature and result of this suit as made by appellants in their brief as follows:

"The city of De Leon instituted this suit against Wm. D. Bolton, the American Surety Company of New York, the First State Bank of De Leon, W. S. Rose, Jr., Byron R. Smith, and J. L. Chapman, banking commissioner of the state of Texas. Chas. O. Austin was thereafter by an order of the court duly entered and substituted for J. L. Chapman, banking commissioner. It was adjudged by the trial court that the plaintiff take nothing by reason of its suit against defendants W. S. Rose, Jr., and his successor, Byron R. Smith.

"Plaintiff alleged in its petition that the city of De Leon is a municipal corporation, duly incorporated under the laws of the state of Texas under the provisions of chapter 17, title 22, of Revised Civil Statutes of the state of Texas, regulating and providing for the adoption and amendment of charters of cities having more than 5,000 inhabitants, and that its charter had been duly adopted and filed in the office of the secretary of state of the state of Texas, as required by law; that Wm. D. Bolton was the duly appointed qualified and acting treasurer of said city of De Leon, and, as required by law, executed his bond in the sum of $15,000 with the American Surety Company of New York as surety thereon, whereby Wm. D. Bolton, as principal, and the American Surety Company of New York, as surety, became bound unto said city of De Leon in the sum of $15,000, conditioned that Wm. D. Bolton, as such treasurer for said city, would faithfully discharge all duties required of him by law as treasurer of said city, then said obligation should become void, otherwise to remain in full force and effect; that Wm. D. Bolton, as treasurer of said city, had defaulted on said bond; that said bond had become due, payable, and enforceable as against Wm. D. Bolton, and the American Surety Company of New York is liable to, and bound to pay to, said city all of its damages in the premises not to exceed $15,000.

"That the First State Bank of De Leon, of De Leon, Tex., was incorporated under the laws of the state of Texas, a banking corporation, on the 2nd day of April, A. D. 1919. It elected to secure its depositors by the adoption of the depositors' guaranty fund plan. It was closed by the banking commissioner of Texas for liquidation on the 16th day of November, A. D. 1921.

"The First State Bank of De Leon and J. L. Chapman, banking commissioner, who was thereafter by order of the court substituted for Chas. O. Austin, then banking commissioner, were also made parties defendants. The plaintiff alleged in its petition that it had no city depository, and that through its treasurer deposited in the First State Bank of De Leon its various funds as an unsecured, noninterest-bearing deposit; that, when the bank was closed by the banking commissioner, said city had on deposit therein to the credit of the various funds of the city an amount aggregating $6,287.49; that the banking commissioner refused to classify its claim as payable out of the guaranty fund. Plaintiff in his petition prayed for judgment against the defendants Wm. D. Bolton, as treasurer of said city of De Leon, and the American Surety Company of New York, surety on his official bond, and also prayed for judgment, establishing his claim as an unsecured, noninterest-bearing deposit secured by, and payable out of, the depositors' guaranty fund.

"The defendant Chas. O. Austin, banking commissioner, and the First State Bank of De Leon answered by general demurrer, special exception, and general denial.

"The defendant American Surety Company of New York answered by general denial and by way of cross-action against its codefendants, Bolton, and by adopting and making its own the amended answer of its codefendant, Bolton.

"Defendant Wm. D. Bolton answered by general demurrer, general denial, and that in the event judgment was rendered against him he have judgment for like amount against Chas. O. Austin, banking commissioner of the state of Texas, and the First State Bank of De Leon, Tex.

"Plaintiff, the city of De Leon, by supplementary petition, replied to the answer of the defendants Chas. O. Austin, banking commissioner, and the First State Bank of De Leon by excepting thereto.

"The court overruled the demurrers, general and special, and exceptions of the defendants Chas. O. Austin and the First State Bank of De Leon, and all demurrers and exceptions of other defendants, including general exception in paragraph 1 of plaintiff's supplementary petition addressed to the first amended original answer of Chas. O. Austin, banking commissioner, and the First State Bank of De Leon, to which all defendants respectively excepted.

"The case was tried by the court without the intervention of a jury, and resulted in a judgment in favor of plaintiff for the sum of $5,972.97, with interest thereon from the 16th day of November, A. D. 1921, at the rate of 6 per cent. per annum against Wm. D. Bolton and the American Surety Company of New York, and that the defendant Wm. D. Bolton have and recover for the use and benefit of the city of De Leon from the First State Bank of De Leon and Chas. O. Austin, as banking commissioner, $5,972.97, with interest thereon from November 16, 1921, at the rate of 6 per cent. per annum, and establishing the same as secured by and payable out of the depositors' guaranty fund, to which judgment all defendants respectively excepted, and in open court gave notice of appeal, and bring this case by an appeal, assigning errors upon which they rely for reversal."

The first assignment advanced by appellee is predicated upon alleged error in the trial court in overruling demurrer to plaintiff's petition in abatement, on account of alleged misjoinder of causes of action. It is insisted that, this suit being against Wm. D. Bolton, city treasurer, and the surety on his official bond, as well as against Chas. O. Austin, banking commissioner of Texas, and the First State Bank of De Leon, there is a misjoinder of causes of action and the demurrer should have been sustained.

Under our system of prosecuting and defending suits, the one great desire and purpose is to avoid multiplicity and to dispose in the one suit every issue that can arise out of the subject, and of all parties who may be materially interested in the subject-matter. As early as the 3 Tex. 270, Justice Wheeler in the case of Thomas v. Hill, the wisdom and the necessity for avoiding multiplicity of suits was plainly announced, and since that time this rule has been the convenience and practice of our courts. Love v. Keowne, 58 Tex. 191; Cobb v. Barber, 47 S. W. 963, 92 Tex. 309; Mateer v. Cockrill, 45 S. W. 751, 18 Tex. Civ. App. 391; Mathonican v. Scott, 28 S. W. 1063, 87 Tex. 396; Harris v. Cain, 91 S. W. 866, 41 Tex. Civ. App. 139.

No positive general rule can be formulated as to what may, or may not, constitute multifariousness, but the circumstances of each case must determine the matter. Nueces County et al. v. Gussett et al. (Tex. Civ. App.) 213 S. W. 725; Skipwith v. Hurt, 60 S. W. 423, 94 Tex. 322. In this case Bolton was city treasurer, and had given bond as city treasurer, wherein he and his bondsmen obligated that Bolton, as treasurer, would faithfully discharge all duties required of him as such treasurer. As custodian of the city funds, Bolton deposited same in the First State Bank of De Leon, which was a guaranty fund bank, and, as treasurer under the facts, was an unsecured depositor. The bank was closed, and, as authorized by law, its assets were taken in charge by the banking commissioner of the state of Texas. The city of De Leon had the right to demand of its treasurer to turn over its fund intrusted, and, upon failure to do so, certainly could maintain suit against the treasurer and his bondsmen; the treasurer having deposited the funds in the bank, which is usual and customary, such deposit being noninterest-bearing, and secured by the guaranty fund, but prevented from withdrawing the funds on account of the insolvency of the bank and the act of the commissioner in taking charge of the assets of the bank. Certainly it could not be said there is a misjoinder when the subject-matter involves the interest of all the parties to this suit. To the contrary, it appears to us that it was proper, and required that all these parties having interest and rights in this fund be parties to the suit, so that the respective rights and liabilities could be adjudicated by one trial and judgment. The liabilities of Bolton and his bondsmen, of course, was proper matter to be determined, and, if Bolton, as treasurer, had any security for the fund by reason of its deposit in a guaranty fund, that security would inure to the benefit of the city as well as to his surety on his bond. It would follow that all were proper and necessary parties, and we think there was no error committed by the court in overruling the demurrer. Clay County v. Merchants' & Planters' Bank (Tex. Civ. App.) 264 S. W. 163; Morris v. Davis (Tex. Civ. App.) 31 S. W. 850; Georgia Home Ins. Co. v. Leaverton (Tex. Civ. App.) 33 S. W. 579; Mayhew & Isbell Lbr. Co. v. Valley Wells Truck Growers' Ass'n (Tex. Civ. App.) 216 S. W. 225; Harris County v. Charlton, 243 S. W. 460, 245 S. W. 644, 112 Tex. 19; Langford v. Power (Tex. Civ. App.) 196 S. W. 662; Kunz v. Ragsdale (Tex. Civ. App.) 200 S....