Giese v. Engelhardt

• Decision Date: 18 February 1970
• Docket Number: No. 8555,8555
• Citation: 175 N.W.2d 578
• Court: North Dakota Supreme Court
• Parties: Rueben H. GIESE, Verna M. Giese and Sam Giese, Plaintiffs and Appellants, v. Ed ENGELHARDT, P. W. Blank, Dale Hewson, Matt G. Koffler, H. E. Sondreal, RayLorenz, George Letvin, John Zoller, Gilbert Saxowsky, State AcceptanceCorporation, the Liberty National Bank and Trust Company, Paul McCann Company,a partnership,Paul McCann and Company, a partnership, Orser, Olson, Wolfe & St. Peter, apartnership, and St. Paul Fire & Marine Insurance Company, a corporation,Defendants and Respondents. Civ.

Page 578

175 N.W.2d 578

Rueben H. GIESE, Verna M. Giese and Sam Giese, Plaintiffs and Appellants, v. Ed ENGELHARDT, P. W. Blank, Dale Hewson, Matt G. Koffler, H.

E. Sondreal, RayLorenz, George Letvin, John Zoller, Gilbert

Saxowsky, State AcceptanceCorporation, the Liberty National

Bank and Trust Company, Paul McCann Company,a

partnership,Paul McCann and Company, a partnership, Orser,

Olson, Wolfe & St. Peter, apartnership, and St. Paul Fire &

Marine Insurance Company, a corporation,Defendants and

Respondents.

Civ. No. 8555.

Supreme Court of North Dakota.

Feb. 18, 1970.

Syllabus by the Court

1. Other rules of civil procedure liberally provide for joinder of claims, parties and actions, and Rule 42(b) is intended to counterbalance them by permitting a separate trial of issue which cannot well be tried together, or which can be conveniently and quickly determined before trial of the other issues.

2. Rule 54(b) forbids an appeal to the Supreme Court where less than all of the claims, of a multiple claim action, have been adjudicated, unless the trial court has, before the taking of the appeal, made an express determination that there is no just reason for delay and an express direction for the entry of judgment.

3. When the determination and direction has been made by the trial court pursuant to Rule 54(b), it constitutes a final judgment, from which an appeal may be taken.

4. The decision of the trial court in making the determination and direction required by Rule 54(b) will be set aside, only if an abuse of discretion is shown.

5. In construing a statute of doubtful meaning the court will give weight to the long-continued practical construction placed thereon by the officers charged with the duty of executing and applying the statute.

6. All state officers must look to the attorney general as chief law officer of the state for opinions on all legal questions relating to their duties as such officers.

7. Executive construction is relied on only if the court finds that the statute is ambiguous or doubtful as to its meaning.

8. The obligations on a bond required by statute are measured by the particular statute requiring the bond, together with other applicable statutes.

9. Existing statutes and law of land at time contract is made become a part of such contract and must be read into it just as if provision to that effect were expressly incorporated therein.

10. Where the state sets up an annual licensing system, and requires a bond for the protection of the public, the bonds must be construed as giveing protection for their full face amount for each year that they are in force.

11. When the statutory provisions requiring the posting of a bond by each applicant for registration as a securities dealer, making posting of a bond a condition precedent to such registration, and making it necessary to renew such registration annually are read together, as they must be, the legislative intent that the bond carry an annual cumulative liability is obvious.

William Lince, Elgin, and Freed, Dynes & Malloy, Dickinson, for plaintiffs and appellants.

Zuger, Bucklin, Kelsch & Zuger, Bismarck, for defendant and respondent, St. Paul Fire & Marine Insurance Co.

Donald R. Holloway, North Dakota Securities Commissioner, Bismarck, amicus curiae.

A. C. BAKKEN, District Judge.

By Amended Complaint dated January 31, 1968, the Plaintiffs, Reuben H. Giese, Verna M. Giese and Sam Giese seek recovery of $10,200.00 plus interest from the Defendants Ed. Engelhardt, P. W. Blank, Dale Hewson, Matt G. Koffler, H. E. Sondreal, Ray Lorenz, George Letvin, John Zoller, Gilbert Saxowsky, State Acceptance Corporation, the Liberty National Bank and Trust Company, Paul McCann Company, a partnership, Paul McCann and Company, a partnership, Orser, Olson, Wolfe & St. Peter, a partnership and St. Paul Fire & Marine Insurance Company, a corporation, for alleged misrepresentation and fraud by said Defendants, except for the Liberty National Bank and Trust Company and the St. Paul Fire & Marine Insurance Company, in sales of State Acceptance Corporation debentures, stock certificates and promissory notes to the Plaintiffs during the years 1963, 1964, 1965 and 1966. The Plaintiffs allege in paragraph XII of said amended complaint: 'That the Defendant St. Paul Fire & Marine Insurance Company did, on September 12, 1962, issue Surety Bond No. 400 AL 9530 in the amount of $5,000.00 guaranteeing that the Defendant State Acceptance Corporation and its agents, employees and salesmen would comply with all of the provisions of the Securities Act of the State of North Dakota. That said surety bond, which has been renewed annually, is presently on file in the office of the North Dakota Securities Commissioner and is in full force and effect during each of the years that the sales to the Plaintiffs herein complained of were completed. That the Defendant State Acceptance Corporation and its agents, employees and salesmen did violate various provisions of the Securities Act of North Dakota as herein alleged, thereby damaging the Plaintiffs in the amount of their respective purchases as above set forth. Therefore the Defendant insurance company is responsible for and is indebted to the Plaintiffs herein to the extent of $5,000.00 for each of the years during which these transactions were completed, or a total sum of $10,200.00.'

The Defendant St. Paul Fire and Marine Company, hereinafter called St. Paul Company answered by stating that 'On or before September 12, 1962, the State of North Dakota, without participation of the St. Paul Company, drafted a bond form. The St. Paul Company did on September 12, 1962, execute as surety, a bond, number 400 AL 9530, with the State Acceptance Corporation as principal and the State of North Dakota as obligee. The bond was in the amount of $5,000.00 and was executed on the form prepared by the State of North Dakota. The bond was continued in force until August 25, 1967.'

The St. Paul Company further counterclaimed for interpleader stating that 'Lawsuits have been started, by the following named Plaintiffs, making claims on the same bond: Reuben H. Giese, Verna M. Giese, Sam Giese; Dan Giese, Etta Giese; Emil Fuchs, Mabel Fuchs; Henry Weidner, Hertha Weidner; Jack Mittlesladt, Margaret Mittlesladt; Charles W. Schollmeyer, Angeletta D. Schollmeyer; Ed Heise and Edward Heise. The total amount demanded by said Plaintiffs is $56,550.00. The total amount of the bond is only $5,000.00. It is apparent that the Plaintiffs are claiming more than is available * * *. WHEREFORE, Defendant St. Paul Company demands: (1) That the Court order interpleader of claimants to the fund; and * * * (4) That the Court permit the Defendant St. Paul Company to pay to the Clerk of this Court the sum of $5,000.00 (representing the amount asserted by it to be the bond penalty which is the subject matter of the various claims) there to abide the judgment of the Court; and (5) That the Court determine the terms of the bond and whether the St. Paul Company is correct in its contention that $5,000.00 is the maximum penalty of the bond; * * *'

The case was determined by the District Court of Burleigh County, the Honorable Clifford Jansonius, Judge presiding, on a limited issue by virtue of an order for interpleader which came about as a result of the counterclaim for interpleader by the St. Paul Company. Said order provides that there will be a 'trial and hearing as to the amount of bond penalty and all issues of law and fact concerning the amount of the bond penalty'.

Said order was made pursuant to Rule 42(b) of the N.D. Rules Civ.Proc. which provides:

'SEPARATE TRIALS. The court in furtherance of convenience or to avoid prejudice may order a separate trial of any claim, cross-claim, counterclaim, or third-party claim, or of any separate issue or of any number of claims, cross-claims, counterclaims, third-party claims, or issues, and may direct a final judgment in accordance with the provisions of Rule 54(b).'

Rule 54(b) of the N.D. Rules Civ.Proc. provides:

'JUDGMENT UPON MULTIPLE CLAIMS OR INVOLVING MULTIPLE PARTIES. When multiple claims for relief or multiple parties are involved in an action, the court may direct the entry of a final judgment as to one or more but fewer than all of the claims or parties only upon an express determination that there is no just reason for delay and upon an express direction for the entry of judgment. In the absence of such determination and direction, any order or other form of decision, however designated, which adjudicates fewer than all of the claims or the rights and liabilities of fewer than all the parties shall not terminate the action as to any of the claims ro parties, and the order or other form of decision is subject to revision at any time before the entry of judgment adjudicating all the claims and the rights and liabilities of all the parties.'

The District Court in its conclusions of law stated that 'Defendant St. Paul Fire and Marine Insurance Company is entitled to a judgment in its favor adjudging that the total amount of the bond penalty on all claims which could be presented is a maximum total penalty of $5,000.00.'

In accordance with Rule 54(b) the District Court in its direction for entry of judgment stated: 'This Court expressly finds that there is no just reason for delay for entry of judgment as to the issues tried regarding the amount of the bond penalty and hereby expressly directs the entry of such judgment in accordance with the above.'

First to be considered is the trial court's order for a separate trial of the question as to the amount of liability of the St. Paul Company under the surety bond. Was a separate trial in furtherance of convenience as required by Rule 42(b) and, if so, was the final judgment directed in accordance with the provisions of Rule 54(b)?

The order of the trial court for a separate trial as to one or more but fewer than all issues or claims will be...