County of Cole v. Central Missouri Trust Company

• Decision Date: 04 January 1924
• Docket Number: 23175
• Citation: 257 S.W. 774,302 Mo. 222
• Parties: COUNTY OF COLE, Appellant, v. CENTRAL MISSOURI TRUST COMPANY
• Court: Missouri Supreme Court

257 S.W. 774

302 Mo. 222

COUNTY OF COLE, Appellant, v. CENTRAL MISSOURI TRUST COMPANY

No. 23175

Supreme Court of Missouri

January 4, 1924

Appeal from Cole Circuit Court; Hon. John G. Slate, Judge.

Affirmed.

Calfee & Westhues and H. J. Westhues for appellant.

(1) The only way a county court can select a depository for county funds, is by complying with Article 8, chap. 86, R. S. 1919. Harris v. Langford, 277 Mo. 527. (2) It was the duty of the county court to substantially comply with said Article 8 in letting the county moneys, and in so doing the county court had no right to connect the letting of the moneys and the selecting of a county depository with any other proposition whatever. Barratt v. Stoddard County, 246 Mo. 501. (3) A substantial compliance with said Article 8 is sufficient. 15 C. J. 549, 550, sec. 243, note 7; Barratt v. Stoddard County, 246 Mo. 501; Harris v. Langford, 277 Mo. 527. (4) In this case the county court complied with the law in selecting depositories for county funds. It ordered the clerk to advertise. The clerk advertised for bids. Bids were received. The money was let in two parts. Bond for depository by defendant was filed and approved. Money was ordered transferred to defendant. Defendant acted as depository. This is a substantial compliance with the law. Article 8, chap. 86, R. S. 1919. (5) Any oral agreements and understandings, if any were had, as alleged in the second part of defendant's answer and the entire matter of defense alleged in the second part of defendant's answer are no defense in this case. (a) Because the county court can only make contracts in writing. (b) Because the county court can speak only by and through its record. (c) Because if any such understanding was had as alleged in defendant's answer, it was contrary to law and not binding on the county. Barratt v. Stoddard County, 246 Mo. 501; Morrow v. Pike County, 189 Mo. 610; Harris v. Langford, 277 Mo. 527.

Dumm & Cook for respondent.

(1) Defendant's objection to the introduction of any testimony on the part of the plaintiff should have been sustained, for the reason that the petition wholly fails to state a cause of action against the defendant. The petition charges that the defendant submitted a bid for one equal part of the county money advertised to be let by the county court on May 7, 1917, and then alleges that on said date the county court made an order of record designating defendant as the county depository for all money for the county belonging to the "Road Construction Fund" for a period of two years. Assuming, for the present purpose, that these allegations of the petition were true, it appears on the face of the petition that the bid was for one thing and the designation or acceptance was for another and a different thing; and the petition, therefore, failed to plead a contract or agreement between the county through its county court, on the one part, and the defendant on the other, and failed to state a cause of action against the defendant. 13 C. J. pp. 265, et seq.; Robinson v. Railroad, 75 Mo 494; Strange v. Crowley, 91 Mo. 287; Taylor v Von Schraeder, 107 Mo. 206; McLean v Association, 64 Mo.App. 55; Cangas v. Rumsey Mfg. Co., 37 Mo.App. 297. (2) The trial court should have sustained defendant's demurrer, offered at the close of the plaintiff's case. Even if the petition could be held to state a cause of action, there was a total variance between the pleading and the proof. The petition alleged that defendant submitted a bid for one equal part of the county money advertised to be let by the county court. The record introduced by plaintiff showed that defendant was designated the county depository for all money belonging to the "Road Construction Fund" for a period of two years, without either pleading or proving that the money belonging to the "Road Construction Fund" constituted one equal part of the money advertised to be let. Since plaintiff sought to rely upon a contract, made up of the bid and the acceptance, it was incumbent on it to prove such a contract; and this it wholly failed to do. Authorities supra; Chapin v. Cherry, 243 Mo. 375, 401; Stone v. Trust Co., 150 Mo.App. 331, 344; Curry v. Greffet, 115 Mo.App. 364, 368; Gaus & Sons Mfg. Co. v. Chicago Lumber & C. Co., 115 Mo.App. 114. (3) There being no contract established by the record entries of the county court, parol evidence was admissible for the purpose of showing what the arrangement and agreement between the county court and the defendant really were. Riley v. Pettis County, 96 Mo. 318, 321, 322; Ray v. Woodruff, 168 Ky. 563, 567; Ferguson v. Rafferty, 128 Pa. 337, 6 L. R. A. 33; Gilbert v. Bank, 160 P. 635; Klueter v. Brew. Co., 143 Wis. 347, 32 L. R. A. (N. S.) 383; 22 C. J. pp. 1084, 1144. (4) The county, through its county court, having accepted from the defendant interest on time certificates of deposit to the credit of the "Road Construction Fund," without objection on its or their part, is now estopped from claiming or asserting that it is entitled to interest on daily balances. 21 C. J. pp. 1206, 1215; Sparks v. Jasper County, 213 Mo. 243; Simpson v. Stoddard County, 173 Mo. 466.

White, J. Woodson, C. J., and Ragland and Graves, JJ., concur; James T. Blair, J., concurs in Paragraphs I and II and the result; Walker, J., dissents in separate opinion in which David E. Blair, J., concurs.

OPINION

WHITE

Action to recover interest claimed to be due from defendant as county depository.

The plaintiff filed its suit in the Circuit Court of Cole County, April 6, 1920, alleging that at the May term, 1917, it advertised for bids from banking corporations, etc., for the privilege of being selected as county depository; that said bids were opened at said May term, and the defendant, having submitted a bid of four and three-fourths per cent annual interest for one equal part of the county money advertised to be let on that day, the county court designated the defendant as a depository for all the money of the county belonging to the road construction fund, defendant being the highest and best bidder for said fund; that defendant filed its bond in accordance with the statute, and received from the county treasurer money of the county in the sum of $ 266,487.17; that defendant accepted the money May 10, 1917, and from that date to July 1, 1919, acted as depository. The petition sets out the amount of deposits to the credit of the county with defendant during various periods extending from May 10, 1917, to July 1, 1919, and alleged that the amount of interest computed upon the daily balances, as provided by the statute, during the different periods, was $ 15,963.61; that defendant at divers times had paid the interest by placing to the credit of the county different sums of money amounting to $ 8086.79, leaving a balance due of $ 7876.82, for which the defendant asked judgment.

The defendant makes here some objections to the sufficiency of the petition. It is unnecessary to consider those objections, as the questions thus raised will be considered below in connection with the record introduced by plaintiff for the purpose of making out a case.

The answer of the defendant and the evidence offered and admitted by the court in support of the answer shows that in February, 1917, long before the county was authorized by law to select at the May term, 1917, a depository for its funds, the county was in difficulty on account of $ 300,000 bonds which has been voted by the people for the construction and maintenance of roads in Cole County. Those bonds could not be sold because of some irregularity in connection with their authorization. They bore five per cent interest. The county court had let contracts for road construction amounting to nearly $ 50,000, but had no funds on hand to meet the contracts because no bids were offered when they attempted to sell the $ 300,000 bonds.

Thereupon the defendant, February 15, 1917, offered to take all the $ 300,000 issue of bonds, provided the county would refund them at four and three-fourths per cent interest with other bonds presumably free from the technical objection to the first issue. This reduced rate of interest on the refunding bonds -- manifestly to the advantage of the county -- was arranged upon condition that the defendant should become the depository of all the money in the road construction fund. In order to avoid the payment of daily balances as required by statute, the defendant agreed to pay four and three-fourths per cent, which was far in excess of the rate then prevailing, provided the money on deposit would be represented by time certificates. The county was to estimate the different times at which money would be needed to pay on road contracts; the time certificates of deposit were arranged to fall due at such time, and it was understood that the defendant was not to pay interest on the checking account. In this way, if the money had been required by the county as was contemplated when the arrangement was made, it would have received a far greater amount of interest at the rate of four and three-fourths per cent on the time certificates than it would have received on daily balances at the prevailing rate of 2.15 per cent. It happened, however, that the war came on, the county could not make contracts for construction as rapidly as it expected, and after the time certificates became due considerable sums in the checking fund were left on deposit with the defendant and were not used by the county for some time.

It was shown that at the time the defendant became the depository the county was receiving 2.15 per cent on daily balances. Members of the county court testified that it was impossible to secure a greater rate than that on daily balances, and the interest actually...