Clinton School Township v. Lebanon National Bank

• Decision Date: 08 June 1897
• Docket Number: 2,216
• Citation: 47 N.E. 349,18 Ind.App. 42
• Parties: CLINTON SCHOOL TOWNSHIP, ETC., v. LEBANON NATIONAL BANK, ETC
• Court: Indiana Appellate Court

47 N.E. 349

18 Ind.App. 42

CLINTON SCHOOL TOWNSHIP, ETC., v. LEBANON NATIONAL BANK, ETC

No. 2,216

Court of Appeals of Indiana

June 8, 1897

From the Boone Circuit Court.

Reversed.

S. R Artman and J. L. Lewis, for appellant.

C. M Zion, for appellee.

OPINION

ROBINSON, J.

This action was brought by appellee to recover from appellant money paid out by appellee for the use and benefit of the appellant. A separate demurrer to each of the five paragraphs of complaint was overruled, and a demurrer to each of the three paragraphs of answer was sustained. These rulings are assigned as error.

In the first paragraph of the complaint it is alleged that the appellee is a banking corporation; that on and prior to the second day of March, 1896, one Bradshaw was the trustee of Clinton Township of Boone county, Indiana, and that as such trustee Bradshaw had employed one S. A. Thompson and one E O. Rogers as teachers in the public schools of said township, and that at the close of their respective terms of teaching there was due and owing from said Clinton township the sum of $ 86.96 to the said Thompson, and the sum of $ 15.00 to the said Rogers; that the said Bradshaw issued to said Thompson and Rogers his check for said respective sums drawn on the appellee, which checks the appellee refused to pay for the reason that said township had no funds in said bank subject to said checks; that on said second day of March, 1896, the said Bradshaw presented said checks in person to the appellee, and requested that the appellee pay said teachers said money upon said checks, representing to the appellee that he had township funds in his hands at his home in Elizaville, in said county, and that if the appellee would advance the money to pay said teachers, as evidenced by said checks, the said Bradshaw would, upon the following day, repay the appellee out of the funds belonging to said township for tuition purposes then in his hands; that, relying upon said statement so made by Bradshaw, the appellee paid over to Bradshaw the sums so mentioned in said checks, without extending or giving any credit to said Bradshaw except as such trustee, and for the sole purpose of discharging said township indebtedness; that said Bradshaw received the money in his official capacity, and applied the same exclusively to the payment of said indebtedness of said Thompson and Rogers, and took their receipts for the same in satisfaction of the debt owed by said township, and that said money was not used in any other manner, or for any other purpose; that the checks were delivered by said Bradshaw to the appellee in consideration of said advancement, and as evidence of the promise to repay the money on the next day following, which he failed and ever since has failed to do; and that said sum has never been paid by the appellant, although demanded so to do by the appellee.

The material allegations of the second paragraph are substantially the same as those of the first, with the additional averment that the township received credit upon the books kept by the trustee for the sums of money so paid by the appellee to the teachers.

The third paragraph seeks a recovery for the amount paid to Thompson, and the fourth paragraph seeks a recovery of the amount paid to Rogers, and each avers that the township received credit for said sums on the books of the township.

The fifth paragraph of the complaint contains all the material averments in the first, and the additional averments that the township received credit for the money so advanced upon its account from said Thompson and Rogers as such teachers, and that in truth and in fact, as the appellee afterward learned, the said Bradshaw, at the time of making said promise, and receiving said money did not have any money in his hands belonging to said township for tuition purposes, but was at that time a defaulter, and had misappropriated the tuition funds of said township, of all of which the appellee was ignorant; and that said Bradshaw shortly after left the country an embezzler and defaulter in said trust, and that by reason thereof his successor in office was appointed, who made settlement of his defalcation upon the part of Bradshaw with the bondsmen of said Bradshaw, and in such settlement the bondsmen received credit for the sums of money so paid to the said Thompson and Rogers, but in truth and in fact said township had never paid said money except by and through the appellee.

It has been often affirmed that a township trustee is a special agent with limited statutory powers, and that he has no general authority to bind the township. He can bind the township when he does what the statute authorizes, and does it in the manner prescribed. Although he may exceed his statutory authority he can not bind his township by estoppel or otherwise. A person...