City of Dickinson, a Municipal Corporation v. White

• Court: North Dakota Supreme Court
• Writing for the Court: FISK, J.
• Citation: City of Dickinson, a Municipal Corporation v. White, 143 N.W. 754, 25 N.D. 523 (N.D. 1913)
• Decision Date: 13 June 1913

143 N.W. 754

25 N.D. 523

THE CITY OF DICKINSON, a Municipal Corporation, v. J. S. WHITE and the Northern Trust Company, a Corporation

Supreme Court of North Dakota

June 13, 1913

On rehearing October 22, 1913.

Appeal from District Court, Stark County, Crawford, J.

From a judgment in plaintiff's favor, defendant, The Northern Trust Company, appeals.

Affirmed on condition.

Affirmed.

Pierce Tenneson, & Cupler, for appellant.

The bank purchased the warrant, placed it on its books as a proper credit, and it could not be charged back. Such transaction was closed, and it constituted payment. Bryan v. First Nat. Bank, 205 Pa. 7, 54 A. 480.

A sale is shown where a check is accepted as cash, and amount checked out, and pass book afterwards written up without charging back the check. Taft v. Quinsigamond Nat Bank, 172 Mass. 363, 52 N.E. 387; National Surety Co. v. State Sav. Bank, 14 L.R.A.(N.S.) 155, 84 C. C. A. 187, 156 F. 21, 13 Ann. Cas. 421; State ex rel. Livesay v. Harrison, 99 Mo.App. 57, 72 S.W. 469; Friedlander v. Texas & P. R. Co. 130 U.S. 425, 32 L.Ed. 994, 9 S.Ct. 570.

The title to the amount of money represented by the warrant became and was vested in the city. Custer County v. Walker, 10 S.D. 594, 74 N.W. 1040.

No portion of a trust fund can be devested, to pay the trustee's individual debt to the bank. 5 Cyc. 550, 551, note 57; Central Nat. Bank v. Connecticut Mut. L. Ins. Co. 104 U.S. 54, 26 L.Ed. 693.

Where the facts are such that no loss can have been suffered, no interest is allowed. In the absence of notification, interest is only allowable from the issuance of the writ. Trumpler v. Cotton, 109 Cal. 250, 41 Pa. 1033, 1036; 1 Brandt, Suretyship & Guaranty, 3d ed. § 126.

H. A. Burgeson and T. F. Murtha, for respondent.

The receipts given by White for moneys received were competent evidence. Our statutes make them such. Rev. Codes 1905, §§ 7298, 7299.

It was the duty of the city treasurer to give a receipt. Rev. Codes 1905, § 2711.

The amount of recovery is limited to the principal of the bond, plus interest from the date of the breach. Getchell & M. Lumber & Mfg. Co. v. Peterson, 124 Iowa 599, 100 N.W. 550; Thomssen v. Hall County, 63 Neb. 777, 57 L.R.A. 303, 89 N.W. 393; Clark v. Wilkinson, 59 Wis. 543, 18 N.W. 481; Whereatt v. Ellis, 103 Wis. 348, 74 Am. St. Rep. 865, 79 N.W. 416; McMullen v. Winfield Bldg. & L. Asso. 64 Kan. 298, 56 L.R.A. 924, 91 Am. St. Rep. 236, 67 P. 892; Griffith v. Rundle, 23 Wash. 453, 55 L.R.A. 381, 63 P. 199; Rev. Codes 1905, §§ 2707, 2713.

OPINION

FISK, J.

The city of Dickinson sues to recover against J. S. White, its ex-city treasurer, and against his surety, the Northern Trust Company, upon certain official bonds given by the said White as such city treasurer, it being plaintiff's contention that the said White defaulted and failed to account for city funds collected and received by him in his said official capacity.

The defendant White was not served with process, and made no appearance in the action, and the Northern Trust Company alone appeals.

A jury was waived and the cause tried to the court, resulting in findings and conclusions favorable to the plaintiff on the second and third causes of action, but holding that the first cause of action was, at the time this action was commenced, barred by the statute of limitations.

The statement of facts in appellant's brief is substantially correct, and we quote from the same as follows:

"The defendant J. S. White was elected treasurer of the city of Dickinson for three successive terms of two years each commencing in April, 1904, and ending in April, 1910. He executed his three official bonds, one dated April, 1904, the second dated April, 1906, and the third dated April, 1908, each covering a period of two years from its date, and each for the sum of $ 2,000. The defendant, the Northern Trust Company, was surety upon each of these three bonds. In April, 1911, the city of Dickinson commenced this action upon all three bonds to recover an alleged shortage in the accounts of said White.

"White was also city treasurer from 1900 to April, 1904, but the Northern Trust Company was not surety on his bond during that period.

"The first cause of action is based upon the bond dated April, 1904, to which the Northern Trust Company answered, denying that any shortage existed, and also pleading the statute of limitations. As the court found that the first cause of action was barred by the statute of limitations, all allegations of the complaint and answer with reference to the first cause of action, as well as Exhibits 7, 8, 11, and 12, and testimony offered in connection with same, are immaterial.

"The second cause of action is based on the bond executed in April, 1906, which is the same in form as Exhibit A. Paragraph VI. of the second count of the complaint alleges 'that the defendant J. S. White did, during his said term of office and in his capacity as such officer, collect as taxes various sums of money, amounting in the aggregate to the sum of $ 6,285.11, and that of this said amount the said J. S. White accounted for and paid over to the plaintiff the sum of $ 5,640,' making an alleged shortage of $ 645.11 under the second cause of action. This was denied by the Northern Trust Company.

"The third cause of action is based on the bond executed in April, 1908, which is the same in form as Exhibit A, and paragraph VI. of the third count of the complaint alleges that said White failed to account for the sum of $ 909.88 for taxes collected, and further alleges 'that the said J. S. White, in his capacity of said officer and under color thereof, did deposit to his credit as city treasurer a number of worthless warrants purporting to have been drawn on Stark county, North Dakota, the said warrants having been repudiated by said Stark county, and the same were returned by banks holding same as deposits to the said defendant, J. S. White, as city treasurer, and same were charged to the plaintiff, together with interest thereon amounting to the sum of $ 6,807.96. A list of said purported warrants is hereto attached and marked Exhibit D and made a part hereof.' Exhibit D, so far as material, refers to warrant of Stark county No. 12,627, for $ 2,150 alleged to have been deposited in the First National Bank of Dickinson on July 14, 1909. The allegations of this paragraph were denied by the answer of the Northern Trust Company.

"To prove the alleged shortage under the second count, plaintiff offered in evidence Exhibit 9, purporting to be a report of J. S. White to the city council for March, 1908, and Exhibit 13 which purports to be a receipt by White to the county treasurer, dated March 31, 1908, for taxes.

"To prove the alleged shortage under the third count, plaintiff offered in evidence Exhibit 10, purporting to be a report by White to the city council for February, 1909, and Exhibit 14, which purports to be a receipt by White to the county treasurer dated February 23, 1909. Also under the third count, plaintiff offered in evidence Exhibit 15, purporting to be a warrant for $ 2,150, the slip showing its deposit to the credit of J. S. White, city treasurer, marked 19, the debit slip of the bank marked Exhibit 20, and the page of the cash book of the city marked Exhibit 21, all of which were objected to. Exhibits 20 and 21 were made February 10, 1910. White ceased to act as city treasurer December 16, 1909.

"The purported reports of White to the city council, Exhibits 9 and 10, were received in evidence over objection that they were incompetent, not the best evidence, and shown to be mere copies. The books of the city or of White were not produced in court nor offered in evidence. The purported receipts to the county treasurer, Exhibits 13 and 14, were received in evidence over objection that they were incompetent, and no proper foundation laid.

"There was no further evidence of shortages than that alleged to have been caused by these Exhibits 9, 10, 13, and 14, and the court found that under the second cause of action a shortage of $ 645.11 had been proved to exist in March, 1908, and that a shortage of $ 841.68 had been proved to exist under the third cause of action in February, 1909.

"The court further found with reference to the third cause of action that on July 14, 1909, the date the warrant was deposited and credited by the bank to White's account, he was short in his accounts in excess of the sum of $ 2,150. The court does not find how or when such shortage was caused, nor its amount; and it must have included the amounts stated above, as the court found that they existed prior to July 14, 1909.

"The only testimony in any way supporting such finding was that of J. S. White, which was objected to by us, and is indefinite and uncertain.

"Exhibit 15 was received in evidence over objection that it was incompetent, irrelevant, and immaterial, not proved to be a forgery, and on the further ground that it had been purchased by the First National Bank of Dickinson from White, and was the property of said bank, and that the bank had no right or authority to charge it back to the city.

"J. S. White kept an account at the First National Bank of Dickinson in the name of 'J. S. White, City Trs.,' and the warrant Exhibit 15 was received from White by Alphonzo Hilliard, the president, on July 14, 1909. The deposit slip, Exhibit 19, was made out and the amount of the deposit, including Exhibit 15, was credited to White's account, as city treasurer.

"T Arthur Tollefson, who testified for plaintiff, has been assistant cashier of the First National Bank of Dickinson since November, 1908, and succeeded White as city treasurer. He testified that it was the custom of the bank to carry, as cash...