Graham v. State Use Monroe County

• Court: Arkansas Supreme Court
• Writing for the Court: KIRBY, J.
• Citation: Graham v. State Use Monroe County, 140 S.W. 735, 100 Ark. 571 (Ark. 1911)
• Decision Date: 06 November 1911
• Parties: GRAHAM v. STATE use MONROE COUNTY

140 S.W. 735

100 Ark. 571

GRAHAM v. STATE use MONROE COUNTY

Supreme Court of Arkansas

November 6, 1911

[Copyrighted Material Omitted]

Appeal from Monroe Circuit Court; Eugene Lankford, Judge; reversed.

STATEMENT BY THE COURT.

Two suits were brought by the prosecuting attorney in the name of the State of Arkansas, for the use and benefit of Monroe County, one against W. L. Graham, treasurer of said county and the sureties on his bond, naming them, for the term commencing October 31, 1906, and ending October 31, 1908, and the other against said Graham, treasurer of said county, and the sureties on his bond, naming them, for the term commencing October 31, 1908, and ending October 31, 1910.

On December 7, 1910, an amended complaint was filed in the same cause, in which all of the defendants named in the first complaint were joined. In this complaint it was alleged that W. L. Graham was duly elected treasurer of Monroe County, on September 3, 1906, and duly inducted into office, having made his official bond in the sum of $ 90,000, as required by law for the faithful accounting of such moneys as should come into his hands, as treasurer, with certain of the defendants naming them, as sureties upon said bond. That said bond was duly approved, and a copy was filed as an exhibit to the complaint.

The second paragraph of the complaint alleges that at the general election in September, 1908, said Graham was again elected to the office of county treasurer of Monroe County, and as such treasurer executed a bond to the State of Arkansas, for the use and benefit of the county of Monroe in the sum of $ 90,000, conditioned as required by law for the faithful performance of the duties of his office and accounting for the public funds that should come into his hands as treasurer, with the other defendants, naming them, as sureties thereon; that the bond was duly approved by the circuit judge; that on the day of , 1910, said Graham resigned the office of treasurer of Monroe County, and Parker C. Ewan was duly appointed to fill the office, caused by the resignation, and continued to serve as county treasurer until the 31st day of October, 1910; that at the time said Graham resigned his office there were due certain amounts, setting them out, specifically, to the different school districts of the county from him as treasurer, and for which he and his bondsmen were liable, and which he failed to pay over to his successor in office, making a total amount of $ 17,199.37, for which judgment was asked against said Graham and all of the sureties upon both his official bonds, with interest at six per cent. and penalties provided by law, and further "that no part of the above amount set forth had been paid by the said W. L. Graham, treasurer aforesaid, and that the same is now past due and unpaid, and there has been made an order of the county court directing him to make said payment, and with said order he has failed to comply, and by reason of said failure to pay over said sum the condition of his official bond has been broken, and the said W. L. Graham and his official bondsmen are liable for said amount, together with interest and penalties and costs of this action."

It was further alleged that at the time of his resignation he was due to the different funds of the county certain sums, naming them, in all $ 2,607.03, for which judgment was prayed with interest and penalty. Judgment was prayed for all purposes in the sum of $ 19,806.40, with interest from December, 1909, and penalties fixed by law. Certified copies of each of the official bonds, as examined and approved, were filed as exhibits to the complaint.

The sureties on the first bond filed a demurrer to the amended complaint, alleging:

"That they are sureties on the bond of W. L. Graham, as treasurer of Monroe County, which was executed on the day of November, 1906, the term of office of such treasurer having expired on the 31st day of October, 1908, and these defendants say that said complaint, substituted complaints and all amendments thereto, do not state facts sufficient to constitute a cause of action against these defendants or any of them."

This demurrer was overruled, and the defendants excepted.

On January 2, 1911, appellants, the sureties on the first bond, filed their separate answer to the amended and substituted complaint, admitting that they were sureties on the official bond of W. L. Graham, as treasurer, for the term commencing on the 31st day of October, 1906, and ending on the 31st day of October, 1908, and denied that the said Graham was short in his accounts during the said term; that he was indebted to plaintiff in any sum by reason of any default during said term, and that they are liable to the plaintiff, by reason of the default of the said Graham during said term or any other term. They further denied "that there has been any order of the county court of Monroe County directing the said W. L. Graham to pay into the treasury of Monroe County, or to the plaintiff herein, any sum by reason of any default occurring during the term of the said W. L. Graham as treasurer for which these defendants were sureties, and deny that the said W. L. Graham has failed to pay over any sum ordered to be paid by the county court aforesaid by reason of default occurring during the term for which these defendants are sureties."

Denied specifically any liability as alleged in the complaint to any and all of the school districts, and for any and all of the county funds as alleged and any indebtedness at all, and asked to be discharged with costs.

The testimony shows that W. L. Graham was elected treasurer of said county for the term from October 31, 1906, to the 31st of October, 1908, that he was elected his own successor, and that his official bonds for the first and second term were both duly approved. The county court record was introduced showing the settlement made with the county treasurer in 1910, as follows:

"In the Monroe County Court, fourth day of April term, June 6, 1910, Monroe County.

"Whereas, the said W. L. Graham, as county treasurer, did on the 21st day of December, 1909, file in the office of the county clerk of Monroe County, his settlement as county treasurer, and, the same having been presented to the county court for approval, and, said settlement coming on for examination and approval, upon examination of the same the court finds that said W. L. Graham, late county treasurer, is indebted to the county of Monroe in the sum of $ 14,808.93, and the said W. L. Graham having, after filing said settlement, resigned the office of county treasurer, and Parker C. Ewan having been appointed county treasurer of Monroe County and [being] commissioned and acting as such, it is therefore ordered that the said W. L. Graham, late county treasurer of Monroe County, pay over the funds or money in his hands so found due by him to the county of Monroe to the said Parker C. Ewan, county treasurer of Monroe County, to-wit: the sum of $ 14,808.93, taking the receipt of the said Parker C. Ewan, county treasurer aforesaid, which receipt or duplicate thereof he is directed to file with this court on or before the first Monday in July, 1910."

The county clerk testified further that an order of the county court was made, on January 2, 1911, correcting said settlement, which was read and is as follows:

"In the matter of the settlement of W. L. Graham, late treasurer of Monroe County, Arkansas.

"Whereas, at the April term of the Monroe County Court, and on the 6th day of June, 1910, thereof, this court found that the above-named W. L. Graham, as county treasurer, was indebted to Monroe County in the sum of $ 14,808.93, the court upon further consideration of this matter, after examination of the report of expert accountants and the records of this court, finds that on the 31st day of October, 1908, the said W. L. Graham was indebted to Monroe County in the sum of $ 10,497.76, for which the said W. L. Graham, as county treasurer, and the sureties on his first bond are liable, and which either the said W. L. Graham or his said sureties have failed to pay, and the said W. L. Graham is hereby directed to pay said sum to-wit: The sum of $ 10,497.76, to the present treasurer of Monroe County and take duplicate receipts therefor."

The sureties on the first bond objected to the introduction of this order, but the court overruled their objections, and they saved their exceptions.

It appeared further that W. L. Graham resigned as county treasurer, and was succeeded by P. C. Ewan, on April 11, 1910, who continued as treasurer until October 31, 1910. That no sums belonging to Monroe County or the various different school districts had been paid by him as such treasurer after the making of the order of the county court on June 6, 1910, and that W. L. Hinton succeeded Parker C. Ewan as county treasurer of Monroe County on October 31, 1910, and is the present county treasurer, and that no part of the funds due Monroe County by W. L. Graham, former treasurer, had been paid to W. L. Hinton.

Expert accountants all testified to an examination of the books of the treasurer, and that he was short in his accounts with the county on October 31, 1908, the end of his first term, in the sum of $ 10,497.76. This testimony was admitted over the objections of the sureties on the first bond.

A great deal of testimony was introduced, which tended to show that a fraud had been practiced by the treasurer upon the county court at the time fixed by law, when the funds of the county were last counted by order of the county court during his first term, by borrowing certain amounts of money temporarily from different persons for the purpose of having it counted and making a showing that there was...