Gross v. Butler

• Citation: 173 S.E. 866,48 Ga.App. 750
• Decision Date: 24 February 1934
• Docket Number: 23029.
• Parties: GROSS et al. v. BUTLER.
• Court: Georgia Court of Appeals

173 S.E. 866

48 Ga.App. 750

GROSS et al. v. BUTLER.

No. 23029.

Court of Appeals of Georgia, Second Division

February 24, 1934

Error from Superior Court, Saurens County; R. Earl Camp, Judge.

Suit by J. W. Butler, next friend, etc., against M. L. Gross and another. Judgment for plaintiff, and defendants bring error.

Reversed.

M. L Gross and J. J. Harris, both of Sandersville, John S. Adams of Washington, D. C., and John A. Dunaway and Bryan Middlebrooks & Carter, all of Atlanta, for plaintiffs in error.

S. P New, of Dublin, and J. W. Butler, of Atlanta, for defendant in error.

Syllabus OPINION.

STEPHENS Judge.

1. A foreign fidelity insurance company may be sued in any county in this state in which it has an agent or place of doing business; and the principal in a guardian's bond for which the company is surety, although living in another county, may be sued jointly with the surety in any county in which jurisdiction over the surety may be obtained. Equity Life Association v. Gammon, 119 Ga. 271, 46 S.E. 100; Morris v. George, 3 Ga.App. 413, 59 S.E. 1116; Civ. Code 1910, §§ 2563, 2553.

2. In a suit against a guardian and the surety upon his bond, to recover the loss alleged to have been sustained by the alleged negligence of the guardian in depositing funds of his wards in an insolvent bank, and for depositing the funds in a bank in which he had a financial interest, the fact that the defendant guardian may have acted as guardian for more than five wards and the fact that officials of the bank had, since the filing of the suit, been tried and convicted of a violation of the laws regulating the conduct of banks, are irrelevant and immaterial as tending to show liability by the guardian in respect to his handling the wards' funds by placing them in the bank, and the fact that the guardian, when he deposited the wards' funds in the bank and while they remained in the bank, was a legal advisor and attorney for stockholders of the bank, does not show that his personal and financial interest conflicted with his duty to his wards. Allegations as to these facts in the petition should have been stricken on demurrer.

3. A deposit in a bank by a fiduciary, such as a guardian, of trust funds in his custody and control, and which are subject to his withdrawal on demand, does not constitute an investment of the funds which can be made only by an order of court. Whatever duty may rest upon a guardian to invest the funds of his ward in securities such as he may be legally authorized to invest them in, he is not an insurer of the safety of the funds in his hands, and is not liable for their loss, where, in handling the funds, he has acted in good faith and in the exercise of the care and diligence required of an ordinarily prudent man. Where the guardian has, in his fiduciary capacity, deposited the funds, subject to withdrawal by him at any time, in a bank of solvent reputation and which he has no reason to believe is insolvent and the funds, through no fault of his, are lost by the insolvency of the bank, he has thereby exercised the care and diligence required of him in the handling of the funds, and is not liable for their loss. There is nothing to the contrary in the act approved August 5, 1929 (Ga. L. 1929, p. 248), authorizing the appointment of guardians for moneys which come to their wards from the United States Veterans' Bureau, which provides that guardians provided for under that act (section 9) shall invest the funds of their wards "in such securities, in which the guardian has no interest, as provided by law for general guardians in this State." Civ. Code 1910, § 3580; Brown v. Wright, 39 Ga. 96; Chancellor v. Chancellor, 177 Ala. 44, 58 So. 423, 45 L.R.A. (N. S.) 1; Ann.Cas. 1915C, pages 47, 48 and note page 51; In re Wood's Estate, 159 Cal. 466, 114 P. 992, 993, 994, 36 L.R.A. (N. S.) 252; 11 R.C.L. pp. 149, 150, § 158; 28 C.J. p. 1145 § 244; Harper v. Betts, 177 Ark. 977, 8 S.W.2d 464, 60 A.L.R. 484 (1), 487; Hammons v. National Surety Co., 36 Ariz. 459, 287 P. 292 (1, 2 & 5), 295; Jones v. O'Brien, 58 S.D. 213, 235 N.W. 654, 656; 14 L.R.A. 103, note; In re Curtis' Estate, 162 Mich. 47, 127 N.W. 36; 60 A.L.R. 489, note; Pierce v. Pierce, 197 N.C. 348, 148 S.E. 438; In re Seidler's Estate, 5 Phila. (Pa.) 85, 19 Phila. Leg. Int. 149; In re Connolly's Estate, 79 Mont. 445, 257 P. 418; In re Workman's Estate, 196 Iowa 1108, 196 N.W. 35; Harding v. Canfield, 73 Minn. 244, 75 N.W. 1112; 24 C.J. "Executors & Administrators," p. 51; Woerner's American Law of Guardianship, § 63; Estate of Law, 144 Pa. 499, 22 A. 831, 14 L.R.A. 103 (1), 106; Thompson v. Orchard State Bank, 76 Colo. 20, 227 P. 827, 37 A.L.R. 115; 28 C.J. 1129; Pomeroy's Equity Jurisprudence,§ 1070; Estate of Wood, 159 Cal. 466, 114 P. 992, 36 L.R.A. (N. S.) 252; Wainwright v. Burroughs, 1 Ind. App. 393, 27 N.E. 591; Gott v. Culp, 45 Mich. 265, 7 N.W. 767; Reynolds' Appeal, 70 Mo.App. 576; Taylor v. Kellogg, 103 Mo.App. 258, 77 S.W. 130; Elliott's Adm'r v. Howell, 78 Va. 297; In re Wisner's Estate, 145 Iowa 151, 123 N.W. 978; Layne v. Clark, 152 Ky. 310, 153 S.W. 437; Scoville v. Brock, 79 Vt. 449, 65 A. 577, 118 Am.St.Rep. 975; Hennies v. Keithly, 213 Mo.App. 529, 255 S.W. 940; Cobb v. Fountain, 187 N.C. 335, 121 S.E. 614; Bohn v. Bohn's Guardian, 229 Ky. 608, 17 S.W.2d 712; In re Brubaker's Guardianship, 214 Iowa 413, 239 N.W. 536; White v. Parker, 8 Barb. (N. Y.) 48; Matter of Pinchefski, 179 A.D. 578, 166 N.Y.S. 204 (1); King v. Talbot, 40 N.Y. 76, at pages 85, 86; McCabe v. Fowler, 84 N.Y. 314; Barney v. Saunders, 16 How. 535, 14 L.Ed. 1047, 21 Curtis, 288; In re Grammel's Estate, 120 Mich. 487, 79 N.W. 706; Pethybridge v. First State Bank, 75 Mont. 173, 243 P. 569; Cronk v. American Surety Co., 208 Iowa 267, 225 N.W. 454; O'Connor v. Decker, 95 Wis. 202, 70 N.W. 286; Corcoran v. Kostrometinoff, 164 F. 685, 91 C.C.A. 619, 21 L.R.A. (N. S.) 399.

4. In a suit to recover of a guardian and the surety on his bond funds belonging to the plaintiffs, which had come into the guardian's possession from the United States Veterans' Bureau, as money belonging to the plaintiffs as beneficiaries of a United States war veteran, and which, it was alleged, had become lost because the defendant guardian had invested them without authority of a court as required by law and placed them beyond his reach or control by lending them to a bank which he at the time knew was insolvent and without taking security therefor, and also in which relatives of his were stockholders, in which he...