Fegan v. Great Northern Ry. Co.

• Decision Date: 03 November 1899
• Docket Number: 6731
• Citation: 81 N.W. 39,9 N.D. 30
• Court: North Dakota Supreme Court

81 N.W. 39

9 N.D. 30

WILKIN W. FEGAN v. THE GREAT NORTHERN RAILWAY COMPANY

No. 6731

Supreme Court of North Dakota

November 3, 1899

Appeal from District Court, Grand Forks County; Glaspell, J.

Action by Wilkin W. Fegan against the Great Northern Railway company. Judgment for defendant, and plaintiff appeals.

Affirmed.

Bosard & Bosard, for appellant.

A payment made under belief of a liability, which did not exist in fact, is not voluntary, and the money may be recovered back, though the mistake might have been avoided if greater care had been taken to investigate and ascertain the facts regarding the transaction. United States v. Barlow, 132 U.S. 271-282; Brown v. Tillinghast, 84 F. 71; Wheadon v. Olds, 20 Wend. 174; Clark v Sylvester, 13 A. 404; United States v. Bank, 39 F. 359; Holmes v. Lucas Co. 53, Ia. 211; National Life Ins. Co. v. Jones, 59 N.Y. 649; Fraker v. Little, 36 Am. Rep. 262.

W. E Dodge, for respondent.

The payment by plaintiff was a voluntary one in settlement of a bona fide claim arising out of plaintiff's misconduct and the misconduct of his agent Stewart. It was made with full knowledge of the facts or the means of ascertaining them by consulting records in his possession. Plaintiff has profited by such payment and by his negligence has made it impossible to place defendant in a position of statu quo. Espy v First Nat. Bank, 18 Wall. 604; Boas v Updegrove, 5 Pa. 516, 47 Am. Dec. 425; Smith v. Schroeder, 15 Minn. 18; Morton v. Marden, 15 Me. 45, 32 Am. Dec. 132; Welch v. Carter, 1 Wend. 185; Mowatt v. Wright, 1 Wend. 355; Bilbie v. Lumley, 2 East. 470; McArthur v. Luce, 5 N.W. 355; Robinson v. Charleston, 45 Am. Dec. 739. The same rule obtains in tax cases. Cooley on Tax'n, 2d Ed. 476, 553; 2 Desty Tax'n, 850; Lynde v. Melrose, 10 Allen 49; Brevort v. Brooklyn, 89 N.Y. 135; Waples v. United States, 110 U.S. 630; Flint v. Comm's'rs, 27 F. 850; Tyler v. Cass Co. 1 N.D. 369; Detroit Advertiser v. Detroit, 5 N.W. 72; County of Wayne v. Randall, 5 N.W. 75.

OPINION

WALLIN, J.

This action was tried in the District Court without a jury, and judgment was entered in that court dismissing the action. None of the findings of fact are challenged in this court, but the appellant claims here that the conclusions of law and the judgment are unwarranted by the facts as found. It appears that this action is for money had and received, and is brought to recover $ 904.83, with interest after July 1, 1895, which principal sum plaintiff claims was paid by him to the defendant under a mistake of fact. The fact of such payment is not in dispute, and the findings show that the same was made under the following circumstances: On November 1, 1894, the plaintiff became the station agent of the defendant at its station at Grand Forks, N.D., and on that day took charge of said station, and the property and business appertaining thereto. When plaintiff was installed as station agent, and long prior thereto, one Daniel S. Stewart had been in the employ of the defendant at said station as cashier of the station, and plaintiff continued Stewart in that capacity. It appears that said station, when plaintiff was installed, was short in its accounts with the defendant, and when plaintiff assumed charge certain waybills and other items of account were suppressed, and did not appear in the transfer of the station to the plaintiff. The sum total of the suppressed accounts exceeded the sum of $ 5,000. Later, and prior to July 1, 1895, these suppressed waybills and accounts were by said Daniel S. Stewart, and without plaintiff's actual knowledge, brought into the accounts of said station, whereby it appeared that the funds of the defendant had been misappropriated and diverted from the defendant while plaintiff had been in charge of the station. It appears that on or about the date last named the defendant represented to the plaintiff the fact that he was short in his accounts with defendant, and represented to plaintiff that said Stewart had, since the plaintiff had assumed charge of said station, collected moneys belonging to the defendant, and misappropriated the same, and diverted them to other purposes than payment to the defendant, to an amount exceeding $ 2,900. The trial court found as follows:

"For the protection of the defendant against the misappropriation of moneys at said station the said defendant had caused the plaintiff herein to be bonded in a company organized and operated for such purpose in the sum of four thousand ($ 4,000.00), and had, on or about the 1st day of October, 1894 caused the said Daniel S. Stewart to be also bonded in said company in the sum of two thousand ($ 2,000.00) dollars. It is the practice and custom of the defendant, when a loss is covered by the bonds of two or more employes, to proceed against the bond securing the larger sum, and thereupon the defendant notified and informed the plaintiff herein that unless the said moneys which had been so misappropriated were replaced and repaid to the defendant at once, that the defendant would proceed upon the bond of the said Fegan for indemnity on account of the said loss; and the said defendant also at the same time advised the plaintiff that they could not proceed upon the bond of the said Stewart, as the amount of the loss was greater than the amount for which the said Stewart was bonded, but, if the said Fegan would pay the overplus, or the amount of the said damage in excess of the amount for which the said Stewart was bonded, to-wit, the amount of nine hundred four and 83-100 dollars ($ 904.83), then, and in that case, the defendant would not proceed upon the bond given for the plaintiff, but would proceed upon the bond given for the said Stewart. At that time the plaintiff herein believed that the said moneys were so misappropriated and diverted during the term of the plaintiff's agency at the said station aforesaid, and while said station was under his direction and control, and that he was liable therefor; and the said Great Northern Railway Company also believed at that time that the said misappropriation had occurred during the plaintiff's term, and that he was liable to them for said amount; and in such belief the plaintiff, on or about the 31st day of July, 1895, paid to the defendant the said sum of nine hundred four and 83-100 dollars ($ 904.83); and the said defendant, so believing that the said plaintiff was liable for the payment of the said sum, received from the plaintiff the said sum of nine hundred four and 83-100 dollars ($ 904.83). * * * The said shortage and misappropriation of funds of the said defendant had, in fact, occurred before the 1st day of November, 1894, and long before the plaintiff had been appointed agent of said company at said station; but the plaintiff did not know such fact until long after the payment of said money, and as soon as he was notified of the fact that the said misappropriation of said moneys had occurred before the 1st of November, 1894, and that he was not liable therefor, he immediately demanded from the defendant repayment of said sum of eight hundred and eight and 26-100 ($ 808.26) dollars, being the balance of said nine hundred four and 83-100 ($ 904.83) dollars, the sum paid by him, after allowing the credit of ninety-six and 57-100 (96.57) dollars; but the defendant has refused to pay the same. All the moneys collected at said station during the term the plaintiff was agent at said station, and all the property that was received at said station during the time the plaintiff was the agent thereof, have been fully accounted for and paid over to the said defendant, and the said plaintiff was not indebted to the said defendant on the said 31st day of July, 1895, in the said sum of nine hundred four and 83-100 ($ 904.83) dollars, or in any other sum whatever. * * *

"The duties of the plaintiff, as such agent, were to exercise (subject to the supervision and direction of his principal) exclusive control and supervision over defendant's business at Grand Forks station, but plaintiff could not and was not expected to perform all labor in the conduct of the business of the station personally, or to personally verify every item of business. He was, under the rules of the company, of which he had due notice and knowledge, responsible for all business transacted by the defendant as such agent. The defendant knew, officially, no other employe at said station. There were printed and written rules promulgated by the defendant, of which the plaintiff had due notice and knowledge at all times during his employment, which, in addition to the general custom of doing business, regulated his conduct. These rules have been in force since 1891, and are still in force. Rule 36 provides as follows: 'No agent is authorized to give credit; charges are invariably payable on delivery; and agents will in no case deliver freight until receipted for by the consignee, or his agent, nor deliver part of a consignment without first collecting charges on the whole.' * * * Rule 37 provides as follows: 'Agents will be held responsible for the safe-keeping of freight received by them, and for all charges thereon.' Another rule, duly proven by defendant provides as follows: 'Remit Daily. Keep no money on hand excepting working fund. Remit the exact amount in excess of working fund provided in advance. Before taking credit on your cash book for remittances, you are required to have the amount definitely ascertained and inclosed in a proper envelope, sealed, and then make your cash-book entry, and forward the remittance by first express. Daily and monthly balance sheets must show the amount remitted to the treasurer and any bank; also the date of the remittance.' The term 'working fund' referred to a certain amount of money kept...