In re Wells

• Decision Date: 07 December 1934
• Docket Number: 13958.
• Parties: In re WELLS et al. v. SCOTT et al. SNYDER et al.
• Court: South Carolina Supreme Court

177 S.E. 665

174 S.C. 403

In re WELLS et al.

SNYDER et al. v. SCOTT et al.

No. 13958.

Supreme Court of South Carolina

December 7, 1934

Appeal from Common Pleas Circuit Court of Greenville County; G. B Greene, Judge.

Proceeding by J. M. Wells, receiver, and others in the matter of Ola Snyder, by her guardian ad litem T. G Snyder, and another, against Mrs. Fannie C. Scott and others wherein certain claimants were respondents. From an adverse decree, plaintiffs appeal.

Affirmed.

The decree of Judge Greene and the report of E. Inman, master follow:

Decree of Judge Greene.

This case comes before me upon exceptions to the master's report and I have heard arguments thereon of counsel representing the receiver and Guy A. Gullick, Esq., the present judge of probate for Greenville county, and certain other claimants, who contend that they are preferred over other classes of claimants.

The facts out of which the questions presented to the court for determination have arisen, may be stated briefly as follows:

Mrs Fannie C. Scott, who was probate judge for Greenville county for a number of years, appears to have received during her terms of office from various sources the total sum of $38,575.15, and she invested most of these funds in real estate mortgages. After she vacated the office and the present probate judge, Guy A. Gullick, Esq., assumed the duties of the office as her successor, an action was brought by the plaintiff against the said Fannie C. Scott and the surety company to which Guy A. Gullick, Esq., as probate judge, was made a party, alleging that Mrs. Scott had carelessly invested the money in her hands and that there would be a substantial loss on account of her negligence in the investment of the funds of her office, and that consequently she was personally liable. and that her surety on her official bond was likewise liable for any loss that might result from her negligent conduct of the office. A receiver was appointed by the court to take charge of the funds and securities of the office, and he was directed by the court to liquidate the assets. Subsequently thereto a compromise settlement was made between the receiver, J. M. Wells, Esq., and the United States Fidelity & Guaranty Company, the surety on Mrs. Scott's bond. In the settlement, the surety paid to the receiver the sum of $12,000 in full settlement of all claims or demands whatsoever against it and the surety thereupon was released and discharged from further liability on said bond. Certain costs and attorney's fees have been paid by the receiver under order of the court out of the funds collected by him from the surety company, but the amounts paid apparently are not in the record. However, this data or information is not necessary for the determination of the questions presented to me.

I have given this case very careful consideration. At the conclusion of the arguments of counsel, I was inclined to think that the master was in error in holding that any of these claimants were entitled to priority over the others, but, after more mature consideration and reviewing the authorities cited by him, I have reached the conclusion that his findings and conclusions are supported by the decisions of our Supreme Court.

It is conceded that the official bond of Mrs. Scott was liable for all funds received by her as public guardian and also in all cases where she received funds from the sale of real estate by her in aid of assets to pay debts of decedents, whether the surplus proceeds of sale were held by her for minors or for persons sui juris. It was the duty of the probate judge under the law to receive these funds in her official capacity, and there can be no doubt whatever that the surety on her bond was liable for any default on her part in the handling of these classes of funds. Section 8623, Code of Laws of 1932, provides that a judge of probate appointed as public guardian and his sureties shall be liable on his official bond for funds received by him for minors, idiots, and lunatics. Also the case of State ex rel. Elliott v. Jeter, 59 S.C. 483, 38 S.E. 124, holds that the sureties on the official bond of a Probate Judge are liable for funds received by him in his official character where it was the duty under the law to receive funds. The law provides that, when the personal property is insufficient to pay the debts of a decedent, the real estate shall be sold by the probate judge in aid of assets to pay debts, and the law has imposed upon him or her the duty in such cases to sell the real estate and to receive the proceeds from the sale and turn it over to the administrator or executor, and it is obvious that, if Mrs. Scott received these funds and there was any loss in consequence thereof, that she was liable on her bond and that her surety was bound to make good any loss that might occur.

I have been unable to find any law in this state requiring or permitting an executor, administrator, or general guardian to deposit with the probate judge, or any law authorizing the probate judge to receive, any funds so as to relieve the fiduciary from his personal liability or to make the probate judge liable under his official bond therefor. Section 3045, Code of Laws of 1932, provides the form of bond of public officers in this state, and one of the conditions is that he or she "shall well and truly perform the duties of said office, as now or hereafter required by law, during the whole period he may continue in said office," etc. If the bond is to be made liable, it must be in only such cases as where the officer fails to perform the duties of his office required by law.

The cases cited by counsel for the receiver appear to be where an officer negligently fails to discharge some duty imposed upon him under the law. These cases seem to me not to be applicable to the facts in this case.

There is quite a distinction between the failure or neglect of a public official to discharge some duty imposed upon him by the law and where he acts without any authority of the law. In the former case his bond is liable and in the latter it is not. The case of Wieters v. May et al., 71 S.C. 14, 50 S.E. 547, 548, states the rule very clearly as follows: "The bond cannot cover any act or omission of a constable done without any authority of law whatever, or in his private or personal capacity as man or citizen, but it protects alone for what he does or omits to do unlawfully in the execution of his office or some official duty imposed by law."

There being no statutory law in this state authorizing or permitting Mrs. Scott to receive in her official capacity these funds from administrators, executors, or guardians, she acted without any authority of law, and I hold that her official bond is not liable therefor.

It is therefore ordered and adjudged that all of the exceptions to the master's report be, and the same are hereby, overruled, and the report of the master be, and the same is hereby, confirmed in every respect.

It is further ordered and adjudged that the receiver, J. M. Wells, Esq., do pay any costs that may have accrued in this proceeding and that he next pay in full all claimants coming within classes 1, 2a, and 2b as set forth in the report of the master, out of any funds in his hands, and that he next pay all other claimants their pro rata share equally in the remainder.

Master's Report.

I have heretofore filed a report in this case, and the facts are fully stated therein and need not be repeated.

In that report there were seven different classes of claimants set forth therein as follows:

Class 1. Funds received by the probate judge as a regularly appointed public guardian.

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