City of St. Joseph v. Wyatt
Decision Date | 17 May 1918 |
Citation | 203 S.W. 819,274 Mo. 566 |
Parties | CITY OF ST. JOSEPH v. GEORGE H. WYATT, UNITED STATES FIDELITY & GUARANTY COMPANY et al., Appellants |
Court | Missouri Supreme Court |
Appeal from Buchanan Circuit Court. -- Hon. Thomas B. Allen, Judge.
Reversed and remanded (with directions).
Culver & Phillip, for appellant United States Fidelity & Guaranty Company.
The court erred in holding that the three-year Statute of Limitations did not apply in this case and in refusing defendant's instruction which so declared. Secs. 1890 8582-4, R. S. 1909; Shelby County v. Bragg, 135 Mo 291; Adams v. Gossom, 228 Mo. 566; State ex rel v. Yates, 231 Mo. 276; Johnson v. United Railways, 243 Mo. 278; Putnam County v. Johnson, 259 Mo. 73; State ex rel. v. Harter, 188 Mo. 516; State ex rel. v. Stonestreet, 92 Mo.App. 214.
McCabe Moore and William E. Stringfellow for appellant American Fidelity Co.
Charles L. Faust and Perry A. Brubaker for respondent.
The three year Statute of Limitations does not apply in this case because the facts pleaded and proven clearly bring it within the exception. The authorities are unanimous, that the Statute of Limitation does not begin to run where fraud and deception have prevented discovery. State ex rel. v. Gates, 231 Mo. 276; Putnam County v. Johnson, 259 Mo. 73; Johnson v. United Railways, 243 Mo. 278; Shelby County v. Bragg, 135 Mo. 291; State ex rel. v. Hawkins, 103 Mo.App. 254. Even the negligence of other officers in failing to discover shortage is no defense. State v. Atherton, 50 Mo. 210; Town of Hudson v. Miles, 71 N.E. 63. Laches is no defense when fraud is not discovered. The duty to commence proceeding arises only upon discovery. 2 Pomeroy Equity Jurisprudence, sec. 917, p. 1648. Sureties cannot claim laches. State v. Powell, 8 Am. St. 522.
RAILEY, C. Brown, C., not sitting. Graves, C. J., and Walker, Blair and Williams, JJ., concur; Bond and Faris, JJ., dissent; Woodson, J., not sitting.
In Banc.
On September 2, 1914, plaintiff, a city of the first class, sued George H. Wyatt, the United States Fidelity & Guaranty Company and the American Fidelity Company, to recover of Wyatt, as treasurer of the city of St. Joseph, and said companies as sureties on his official bonds, an alleged shortage of $ 30,341.51. The case was disposed of by the trial court as a proceeding in equity. Hon. L. A. Vories was appointed master in chancery to hear the evidence, and report his findings of fact and conclusions of law. After hearing the testimony the master made his report to the court, which was confirmed by the latter, and judgment entered for the penalty of the various bonds given by Wyatt, as city treasurer, to be satisfied on payment by the defendant, the United States Fidelity & Guaranty Company, of sums aggregating $ 21,942.46, and by the American Fidelity Company of the sum of $ 4429.09.
It appears from the record that Wyatt was elected and served as treasurer of said city for four years from April 16, 1906, during which period the United States Fidelity & Guaranty Company was surety on his bond, as treasurer aforesaid, in the penal sum of $ 50,000. It appears that Wyatt was again elected treasurer of said city for a period of two years from April 15, 1910.
The master found -- and the evidence shows -- that:
"The amount of money misappropriated by Wyatt during a period extending from April 16, 1906, to September 2, 1911, was $ 16,431.69, which represents the sum for which the United States Fidelity & Guaranty Company disclaims liability because of the running of the three-year Statute of Limitations, this suit having been brought and filed September 2, 1914."
Both of the surety companies aforesaid filed their respective motions for a new trial and motions in arrest of judgment. All of said motions were overruled and both of said defendants appealed to this court. The American Fidelity Company dismissed its appeal in this court. On the record before us, it becomes our duty to determine whether the remaining surety company is liable for the shortage of $ 16,431.69 aforesaid, or whether said demand is barred by virtue of the provisions of Section 1890, Revised Statutes 1909.
Such other matters appearing of record, as may be necessary, will be considered in the opinion.
I. This action was brought against Wyatt, as treasurer of plaintiff, and the two corporations as his sureties. The American Fidelity Company dismissed its appeal in this court. The evidence shows, and it is conceded by the United States Fidelity & Guaranty Company, that from September 2, 1911, to April 15, 1912, while said last named company was surety for Wyatt, the latter misappropriated $ 1719.49 of funds belonging to plaintiff. The evidence also shows, and it is conceded by the United States Fidelity & Guaranty Company, that from April 21, 1913, to February 12, 1914, when Wyatt resigned, he misappropriated $ 3742.28 of funds belonging to plaintiff; that the total amount misappropriated by Wyatt, after September 2, 1911, while the above named Guaranty Company was his surety, amounted to $ 5461.77.
On page 26 of said company's brief, it is said: "This defendant admits its liability for this amount and made the same admission before the master, and the trial court." On page 9, of the Guaranty Company's brief, it is said:
The evidence shows, and the master found, that Wyatt, as treasurer, between April 15, 1906, and September 2, 1911, while the United States Fidelity & Guaranty Company was its surety, misappropriated $ 16,431.69. If the above demand is found to be barred by Section 1890, Revised Statutes 1909, it would necessitate a reversal and remanding of the cause.
In view of the foregoing and the elimination of the American Fidelity Company, as appellant herein, we do not deem it necessary to consider, or determine, whether the petition states a good cause of action in equity, nor whether there was an improper joinder of parties defendant, or of different causes of action therein.
II. It is contended by the United States Fidelity & Guaranty Company that plaintiff's demand as to said shortage of $ 16,431.69, which occurred more than three years prior to the commencement of this action, is barred by the provisions of Section 1890, Revised Statutes 1909, which reads as follows:
"Within three years: First, an action against a sheriff, coroner or other officer upon a liability incurred by the doing of an act in his official capacity and in virtue of his office, or by the omission of an official duty, including the non-payment of money collected upon an execution or otherwise; second, an action upon a statute for a penalty or forfeiture, where the action is given to the party aggrieved, or to such party and the State."
We are clearly of the opinion that the liability of the Guaranty Company for the payment of said sum of $ 16,431.69 must be determined under the above section, in connection with the facts of the case. The burden of proof devolved upon plaintiff to show a state of facts which prevented said statute from running against it. The quantum of proof necessary under such circumstances is fully discussed in Shelby Co. v. Bragg, 135 Mo. 291, 36 S.W. 600, and following; Callan v. Callan, 175 Mo. l. c 360-1-2; State ex rel. v. Harter, 188 Mo. 516, 87 S.W. 941; State ex rel. v. Yates, 231 Mo. 276, 132 S.W. 672; Johnson v. United Railways, 243 Mo. 278, 147 S.W. 1077, and following; Putnam County v. Johnson, 259 Mo. 73, 167 S.W. 1039.
The master, in his report, correctly said:
The further statement of the master in his report, is sustained by the testimony:
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