Lancaster Cnty. v. State

• Decision Date: 30 October 1914
• Docket Number: No. 18634.,18634.
• Citation: 149 N.W. 331,97 Neb. 95
• Parties: LANCASTER COUNTY v. STATE.
• Court: Nebraska Supreme Court

97 Neb. 95

149 N.W. 331

LANCASTER COUNTY

v.STATE.

No. 18634.

Supreme Court of Nebraska.

Oct. 30, 1914.

Syllabus by the Court.

The statute which permits an action to be brought against the state by permission of the Legislature or either house thereof, provides: “The court in which such action may be brought shall hear and determine the matter upon the testimony according to justice and right, as upon the amicable settlement of a controversy, and shall render award and judgment, against the claimant, or the state, as upon the testimony right and justice may require.” Rev. St. 1913, § 1180. Under this direction it is the duty of the court to brush aside technical defenses and to act in like manner as if the parties were seeking to amicably settle their controversy. Under these provisions and the circumstances of this case as set forth in the opinion the statute of limitations should not be held to be a defense to the action.

Where a county treasurer has deposited money received by him for taxes “belonging to the several current funds of the county treasury” in a depository bank, which has given bond as specified in the depository statute (Laws 1891, c. 50), he is not liable for the safe-keeping of the funds.

Where the county treasurer is relieved from liability upon his bond for the loss of funds deposited in such banks, the county itself (in the absence of extraordinary circumstances, such as fraud, bad faith, or gross negligence in the selection of a depository or the approval of its bond) is free from liability to the state for money collected as taxes in the capacity as trustee for the state and deposited by the county treasurer in such depository bank.

A county is not an insurer of the safekeeping of funds derived from the collection of state taxes in its capacity as trustee for the state.

Where a county treasurer, under the mistaken idea that a county was the insurer of money received by it from taxes for the benefit of the state, paid to the state treasurer from other money belonging to the county an amount equal to the proportion which the state owned of the money deposited in a depository bank, which was lost on account of the failure of the bank without the fault of the county, an action may be maintained, under the permission of the state Senate, to recover back such money erroneously paid, and the fact that certain entries were made in the county books by the treasurer, charging the money lost to certain county funds, under the same mistaken idea, is no defense to the action.

Additional Syllabus by Editorial Staff.

In Laws 1891, c. 50, § 6, requiring that the county treasurer deposit in depositories public money received by him belonging to the several “current funds of the county treasury,” the phrase quoted refers to state, county, and other taxes collected by the county treasurer.

Appeal from District Court, Lancaster County; Cosgrave, Judge.

Action by Lancaster County against the State. From a judgment for plaintiff, the State appeals. Affirmed.Grant G. Martin, Atty. Gen., and Geo. W. Ayres, of Lincoln, for the State.

J. B. Strode, G. E. Hager, and Strode & Beghtol, all of Lincoln, for appellee.

LETTON, J.

The following states plaintiff's cause of action in substance: In January, 1893, the Capitol National Bank of Lincoln was an authorized county depository. The treasurer of Lancaster county had on deposit therein $39,660.62, public money derived from the payment of taxes. Upon the 21st of that month the bank failed, and over $32,000 of the amount deposited was lost. The county treasurer, acting upon his own judgment, shortly afterwards paid to the state treasurer out of the county funds the amount of $10,348.27 for taxes collected by Lancaster county for the state and lost by the failure of the bank. This action was taken under the belief that Lancaster county was an insurer of money collected for the state until it was delivered to the state treasurer. In 1903 an action was brought by Lancaster county against the state under permission of the Legislature to recover this amount. A demurrer to the petition was sustained, and the action dismissed. On appeal, the judgment of the district court was reversed, and the cause remanded to the district court. Afterwards, through mistake and inadvertence and without the knowledge of Lancaster county officials, the case was dismissed. After this was done the Senate passed a resolution which recited the fact of the dismissal of the case through inadvertence, authorized the county to prosecute another action for the same purpose, directed the Attorney General to defend the suit on behalf of the state, and also provided:

“Be it further resolved that no alleged inattention or failure to prosecute the said claim or suit heretofore instituted shall be urged to the prejudice of any claim, action, or suit that may be filed and instituted by the said county of Lancaster.”

The prayer is for a judgment for the money paid to the state by mistake. The answer denies that any part of the money deposited in the Capitol National Bank was state money, that any part of the money paid to the state treasurer was paid through inadvertence or mistake, and that it was through inadvertence or mistake that the former action was dismissed. It is further pleaded that at the time the money was paid there was due the state for state taxes collected over $46,000, and that this sum was paid by the county treasurer on the day alleged, without any knowledge or notice on the part of the state that the payment or any part thereof was made or claimed to be made from county funds. It...