Davis v. Steuben School Township

• Decision Date: 08 April 1898
• Docket Number: 2,406
• Citation: 50 N.E. 1,19 Ind.App. 694
• Parties: DAVIS v. STEUBEN SCHOOL TOWNSHIP
• Court: Indiana Appellate Court

50 N.E. 1

19 Ind.App. 694

DAVIS v. STEUBEN SCHOOL TOWNSHIP

No. 2,406

Court of Appeals of Indiana

April 8, 1898

From the Warren Circuit Court.

Reversed.

Nebeker & Simms, for appellant.

C. V McAdams, J. Frank Hanly, Robert Braden and Harley D Billings, for appellees.

OPINION

WILEY J.

The appellee, through its trustee, issued to one G. W. Boyd its three several township orders, or warrants. One of these was issued April 20, 1893, and became due on or before August 15, 1894, and was for $ 247,00. The other two were issued March 2, 1894, and became due respectively on or before June 25, 1894, and September, 25, 1894, the one becoming due first being for $ 235.00, and the other for $ 240.00. The order dated April 20, 1893, purported to have been given for "school supplies," the one due June 25, 1894, for "school desks," and the one due September 25, 1894, for "said supplies." These several orders were assigned by indorsement to the appellant before maturity, and for a valuable consideration. Appellant commenced an action against appellee upon these orders, and recovered judgment by default. The complaint was in three paragraphs, each paragraph being based upon one of the said orders. Judgment was rendered January, 16, 1895. At the time the orders were issued one Miles Starry was trustee of appellee township, and continued in that capacity until the first Monday in August, 1895, when he was succeeded by one Robert A. Chandler. On August 15, 1896, the appellee filed its complaint or motion, under section 396, Horner's R. S. 1897, to be relieved from the judgment, and to be permitted to defend against the action. Proper notice was served, appellant appeared, and such proceedings were had as that the relief prayed for was granted, and the judgment vacated and set aside. The appellee then appeared to the original action, and demurred severally and separately to each paragraph of the complaint. The court sustained the demurrer to the second and third paragraphs, and overruled it as to the first. Issues were then joined as to the first paragraph, trial by the court, and judgment for appellee.

Appellant has assigned errors as follows: "(1) The court erred in overruling the demurrer of appellant to the complaint and application of the appellee to set aside and vacate the default and judgment in said cause; (2) said complaint to set aside said default and judgment does not state facts sufficient to constitute a cause of action; (3) the court erred in making its order, and adjudging that the default and judgment in said cause be set aside, and in sustaining said application therefor; (4) the court erred in sustaining appellee's demurrer to the second and third paragraphs of complaint, and (5) the court erred in rendering a final judgment against appellant, and that he take nothing by his suit."

Waiving any technicality that might be urged against some of the specifications of the assignment of errors, we will address ourselves to a discussion and determination of the controlling questions presented by the record, to wit:

(1) Did the court err in setting aside and vacating the original judgment? And (2) did the court err in sustaining appellee's demurrer to the second and third paragraphs of complaint?

To a determination of the first question, it will be necessary to state as briefly as possible the facts upon which appellee based its motion to be relieved from the judgment. In the motion it is averred that Miles Starry was duly elected as trustee of appellee township and entered upon the discharge of his duties the first Monday in August, 1890, and vacated said office on the first Monday of August, 1895, being succeeded by Robert A. Chandler. The motion then recites that as trustee said Starry issued the three orders above described; that they were indorsed to appellant; that he commenced an action thereon, and that summons was duly served on said Starry as trustee of said township; that while said suit was pending, said Starry made payments to appellant on said orders, aggregating $ 440.00, four hundred dollars of which were applied on the principal and interest, and forty dollars upon attorneys' fees; that on January 16, 1895, on appellant's motion, appellee township was defaulted, and judgment rendered for $ 416.85, the balance due, which included $ 34.00 attorneys' fees. That said Starry as trustee, or otherwise, did not appear to said action either in person or by attorney, to defend, but suffered default and judgment; that at the succeeding term of said court, said Starry employed counsel, and filed a motion in said cause to reduce the amount of judgment in the sum of $ 34.00 on account of the attorneys' fees included therein, which motion was overruled. It is then averred that there was no consideration passed from said Boyd to the said township, or from any other person to it, for which said pretended orders or warrants were issued, and that said Boyd nor any other person, delivered to appellee township any school desks or school supplies for which said orders were issued, and that no school desks or supplies were received or accepted therefor; that, at the time said suit was commenced and judgment rendered, said township was not indebted to appellant or any other person for school desks or supplies for which said orders were given; that when said Starry filed his final report with the board of commissioners of Warren county, on the first Monday of August, 1895, when he retired from the office of trustee, he did not take credit for the $ 440.00 paid by him on said orders, nor did he ever take credit therefor in any of his reports and settlements. That said Starry as such trustee did not keep in his office record, nor file in his final account, nor post up near his office or at any other place, any statements of the indebtedness of appellee township outstanding at the time he retired from said office; that the board of commissioners refused to approve his final report; that while he was trustee he received and disbursed about $ 30,000.00 belonging to said township, and that after the refusal so to approve his final account, his successor in office commenced an investigation of the affairs of said township, and of the receipts and disbursements of its funds, while said Starry was trustee; that such investigation involved great labor and long time; that on account of the indefinite character of the many vouchers taken by him, the investigation required the identification of all the property in the possession of the township and a comparison thereof with the credits claimed by Starry in his several accounts, and after fully completing said investigation, said Chandler as such trustee became satisfied that improper credits had been claimed by said Starry, and suit was instituted by him on his official bond, and he recovered in said action, on behalf of said township, the sum of $ 2,600.00 in April, 1896; that a large proportion of said sum was for money claimed by Starry to have been paid by him to said Boyd, for school supplies, which were never purchased, received or accepted by appellee. That pending said action there was also pending a suit by one Stafford against appellee, on alleged warrants issued by said Starry to said Boyd, which suit was finally in April, 1896, determined in favor of appellee, and that there are still outstanding against appellee, alleged warrants issued by said Starry to said Boyd, and by him assigned to various persons, aggregating in amount about $ 10,000.00, which upon investigation said Chandler found to be invalid, and issued without any consideration; that repeated demands have been made upon said Chandler as trustee for the payment of said warrants, and that since assuming said office he has had almost continually some alleged claim against said township growing out of the transactions between said Starry as such trustee and said Boyd, until the month of July, 1896, when he completed his investigations of matters then pressing upon him for settlement; that since said time he has been pressing through his counsel an investigation of the judgment rendered in this cause. That said Starry and said Boyd, before the dates of the warrants sued on in this action, entered into a conspiracy to rob and plunder said school township of its special school revenue, by the issuing of alleged warrants by said trustee to said Boyd, without any consideration, which said warrants were to be sold by said Boyd and the proceeds of said sales to be divided between them, and in keeping with said unlawful combination, said Starry paid on the warrants sued on $ 440.00 and refrained from taking any credit therefor, thereby concealing the fact of said payments, and the discovery thereof came about by the investigation aforesaid; and that in keeping with said unlawful combination, said Starry failed and neglected to defend or cause to be defended the interests and rights of appellee in said action, and that he corruptly and unlawfully suffered said judgment to be rendered against appellee. It was further charged that appellee could not defend against said action except through its trustee, and that on account of the neglect and failure of said Starry to defend in said action, the appellee was prevented from making its defense therein, without any fault or negligence on its part, and that appellee's defense to said suit is a total want of consideration for the issuing of the warrants sued upon. Appellee's application to vacate the judgment and to be permitted to defend against the action, was accompanied by copies of each of the orders sued upon as exhibits, and was verified by Chandler as trustee and Charles V. McAdams, his attorney.

As above stated, appellant appeared to this motion, and demurred thereto. Th...