Cnty. of Haw. v. William Purdy & the U.S. Fid. & Guar. Co. of Balt.
| Decision Date | 02 November 1914 |
| Citation | 22 Haw. 272 |
| Court | Hawaii Supreme Court |
| Parties | THE COUNTY OF HAWAII v. WILLIAM PURDY AND THE UNITED STATES FIDELITY & GUARANTY COMPANY OF BALTIMORE, MARYLAND. |
OPINION TEXT STARTS HERE
EXCEPTIONS FROM CIRCUIT COURT, FOURTH CIRCUIT.
Syllabus by the Court
The power of a county to do ordinary business, and to buy and sell property, is vested in its board of supervisors which may, through one of its members, acting as a committee, sell property, and supervise road work in a given district.
It having been stipulated by the parties that P, a member of the board of supervisors for the district of H, sold certain crushed rock; supervised the road work in his district; made up false pay-rolls for road work; approved same and presented them to the board of supervisors which allowed same, after which he received and cashed warrants for the fraudulent claims, and converted money from such sales and fraudulent claims; and, that he acted under a custom existing in the county under which a supervisor made such sales, supervised road work in his district and looked after the pay-rolls, the law presumes, in the absence of any showing to the contrary, that the board of supervisors had authorized him, as a committee of the board, to make such sales, and supervise such road work, and look after the pay-rolls therefor; and that he was acting in a matter in which he was authorized to act.
Where the bond of a county supervisor is conditioned that he will faithfully perform the duties of office prescribed by law, and pay over as directed by law all moneys received by virtue of his office, his surety is liable for money which he receives while acting in a matter in which he is authorized to act, if he wrongfully misapplies such money; as, in doing so, he is not faithfully performing his duty as a county supervisor, but guilty of official misconduct.
Where an officer acting in a matter in which he is authorized to act, is guilty of official misconduct, he is not faithfully performing his official duties, and he and his surety are liable for resultant damages on his official bond.
A complaint was defective in that a material fact was not alleged; defendant answered; at the trial the material fact, with other facts, was stipulated, without objection; the plaintiff recovered judgment. Held, that the defect was cured by the stipulation and judgment.L. P. Scott, Deputy Attorney General ( I. M. Stainback, Attorney General, with him on the brief) for plaintiff.
C. S. Carlsmith for defendant U. S. Fidelity & Guaranty Co.
The plaintiff commenced this action against the defendant Purdy as principal and The United States Fidelity & Guaranty Company of Baltimore, Maryland, as surety, upon two official bonds given under the provisions of Act 39, Session Laws 1905, known as the County Act. The bonds were executed in the form prescribed in section 25 of said act, one approved by the circuit judge of the fourth circuit on the second day of January, 1911, and the other approved January 6, 1913. In each the conditions are stated as follows: “Now Therefore, if the said bounden William N. Purdy shall faithfully perform all the duties of his said office as prescribed by law; shall safely keep all moneys which may come into his possession by virtue of his said office; shall promptly pay over to the person or persons legally authorized to receive the same all such moneys in the manner prescribed by law; and shall deliver over to his successor in office all moneys held by him as such officer; then this obligation to be null and void; otherwise to remain in full force and effect.” The defendant Purdy did not defend the action and does not join in prosecuting this appeal. The cause was submitted to the court without a jury upon the pleadings and an agreed statement of facts covering eight typewritten pages, which may be summarized as follows: The defendant Purdy was elected supervisor for the Hamakua district in the county of Hawaii in November 1910, and again in November 1912, and qualified under each election, executing, with the other defendant named, the two bonds sued upon in this action, the first of which was in force and effect from January 2, 1911, until the sixth of January, 1913, the latter from January 6, until August 6, 1913. In the year 1912, the defendant Purdy, claiming to represent the county of Hawaii, and “in accordance with a custom which had prevailed in the county of Hawaii of permitting members of the Board of Supervisors to enter into similar contracts,” sold and delivered to the Paauhau Sugar Plantation Company certain rock which had been quarried and crushed by the county and with labor paid for by the county, receiving therefor sums aggregating $1625, which he retained and converted to his own use and failed to pay over to the county. That a custom had prevailed in the county, from its organization, under which supervisors from the several districts of the county assumed general control and supervision over the building, maintenance and repair of public roads, and the employment of labor therefor, in the district from which elected, and in accordance with said custom the defendant Purdy within the dates mentioned in the complaint did place upon the payrolls of said district the names of certain persons who did not work upon any road for the said county; that he signed the names of such persons to said pay-rolls, approved said pay-rolls which were approved by the board of supervisors of the county, procured warrants for the amounts shown on said pay-rolls, and endorsed and collected said warrants, all aggregating the sum of $1177.50, in all of which acts he claimed to represent the county, and the persons dealing with him so understood. That demand had been made of him for payment of all of said sums, and also of his said surety, but none of the same had been paid. Upon the pleadings and agreed facts the circuit court found in favor of the plaintiff, and rendered judgment as demanded for the sum of $2802.50, with interest and costs. The defendant surety company brings the case here upon exceptions which challenge the correctness of the findings and judgment of the trial court, principally upon the ground that the acts of the defendant Purdy, shown by the complaint and agreed facts, were done by color of office and not by virtue of office, and the judgment therefore is contrary to law and the evidence.
This case has been ably presented by the respective parties by written briefs and oral arguments. A large number of authorities have been cited on behalf of the respective parties, it being urged on behalf of the defendant surety company that the acts of the defendant Purdy complained of, were not done by virtue of office, but under color of office, and therefore, the same did not constitute breaches of the bonds sued on. The questions raised call for an inquiry into the powers and duties of county supervisors. The defendant contends that county supervisors can only act conjointly, or as a board; that an individual supervisor cannot sell county property, nor do any act that will bind the county, and therefore the acts of defendant Purdy in question do not constitute breaches of the conditions of the said bonds for which the defendant surety is liable; that sureties are favored in the law, and the conditions of their undertaking strictly construed in their favor, their liabilities never being extended beyond the letter of their contracts. Many decisions have been cited in support of defendant's contentions. A careful consideration of the authorities shows that they are susceptible of classification. In some of them the principal received money contrary to the directions of a positive statute, as where a statute required that before a license should issue the fee therefor should first be paid into the hands of another officer, and the principal defendant issued the license without the fee being so paid, received the fee himself and misappropriated it, the sureties being held not liable. (State v. Moore, 56 Neb. 82, 76 N. W. 474;Orton v. City of Lincoln, 56 Ill. 79,41 N. E. 159; San Luis Obispo County v. Farnum, 108 Cal. 562, 41 Pac. 445; Lowe v. City of Guthrie, 4 Okla. 287, 44 Pac. 198.) Other cases hold that where an officer receives money to which the State or municipality is not entitled, misappropriates it, and his sureties are sued that they are not liable. (State v. Porter, 69 Neb. 203, 95 N. W. 769;People v. Cobb, 10 Col. App. 478, 51 Pac. 523.) Sureties have been held not liable under the following circumstances: An officer collected money which the law directed should be paid to another. (State v. Griffith, 74 Ohio St. 80, 77 N. E. 686.) A public official committed a private trespass without warrant or authority. (Drolesbaugh v. Hill, 64 Ohio St. 257, 60 N. E. 202.) The law required a sheriff to take a replevy bond from the plaintiff before delivering property to him, and he delivered it without the bond, took cash as security, squandered the money, and it was held that he did not act by virtue of his office. (People v. Hilton, 36 Fed. 172.) A collector of customs, acting outside of his duties, undertook to transport a large sum of money from his office to a city in another State, and part of the money was stolen. (United States v. Adams, 24 Fed. 348.) A clerk issued guardian letters before a bond was first given as required by statute, the letters being void. (Carpenter v. Sloane, 20 Ohio 327.) A bond was conditioned that all public moneys that should come into the hands of an officer, should be faithfully accounted for, and he received money from the sale of private Indian lands and kept a small portion of the money for compensation. (United States v. Rogers, 81 Fed. 941.) The bond of a constable stipulated that he would “faithfully perform all of the duties of a constable in the...
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