National Sur. Corp. v. Fisher, Century Indem. Co., Intervenor-Respondent, 45641
| Decision Date | 10 November 1958 |
| Docket Number | No. 45641,45641 |
| Citation | 317 S.W.2d 334 |
| Parties | NATIONAL SURETY CORPORATION, a corporation, Plaintiff-Appellant, v. H. R. (Abe) FISHER, Defendant-Appellant, The Century Indemnity Company, a corporation, Intervenor-Respondent. |
| Court | Missouri Supreme Court |
James H. Keet, Springfield, for plaintiff-appellant.
Allen, Woolsey & Fisher, Harold J. Fisher, Springfield, for appellant, H. R. (Abe) Fisher.
J. Weston Miller, John H. Fairman, Mayte Boylan Hardie (Miller, Fairman & Sanford, Springfield, on the brief), for respondent-intervenor.
Plaintiff, National Surety Corporation, instituted this suit by attachment on May, 26, 1954, against the defendant Fisher, and by summons in garnishment levied on a deposit standing in Fisher's name in the State Bank of Lebanon. The answer of the garnishee admitted a deposit of $8,593.62, and it subsequently paid that money to the clerk of the court. The respondent Century Indemnity Company intervened, claiming a prior right to the fund. Following a jury-waived trial, the court sustained the attachment, but, on the merits, awarded the money to the intervenor. A considerable portion of the facts are stipulated and certain others are documentary.
It will be impossible to state all the facts or review all the cases cited within the scope of this opinion. Plaintiff had, on August 7, 1953, executed a performance bond for Fisher for the construction of a school building at Dixon, Missouri. We shall refer to this as the Dixon job. Fisher completed that job, presumably prior to May 1, 1954, but failed to pay various bills thereon totaling $12,759.90. Plaintiff paid these bills, two on the day this suit was filed, and the rest later; at the time of filing it had actually paid none. In its petition it alleged: the making of the construction contract, the execution and substance of the performance bond and the application therefor, and that, upon information and belief and in so far as plaintiff could determine, Fisher owed $13,868.01 in unpaid claims for which plaintiff was responsible; that, however, plaintiff did not waive the right to contest the amounts of any such claims. Plaintiff prayed a money judgment against Fisher in the amount of $13,868.01, plus $2,500 for its expenses.
Plaintiff's attachment affidavit alleged: (1) nonresidence; (2) that defendant was about to convey fraudulently property and effects to hinder and delay creditors; and, (3) that defendant had fraudulently concealed, removed and disposed of his property and effects. By a verified motion to dissolve the attachment, defendant alleged that he was a resident of Missouri, that plaintiff's petition was, in effect, a suit in equity in which an attachment would not lie, and that it stated no cause of action. This motion was overruled, but it seems to have been agreed between the parties and the court that this should not prejudice the presentation of some or all of these matters at the trial. The agreement is somewhat vague, but we may consider the issues as remaining open. On June 4, 1954, defendant filed an answer in which he attacked the court's jurisdiction and renewed, on special appearance, his request that the attachment be quashed, denied that he was a nonresident, and took issue on the merits of plaintiff's substantive allegations; defendant also alleged that the money attached was a trust fund created for the specific purpose of paying the costs of construction on another job. This will be elaborated later.
On October 1, 1954, respondent Century Indemnity Company filed its motion to intervene and attached its proposed intervening petition; in this motion it alleged that the money attached was a progress payment on another construction job of Fisher's for which it had executed a performance bond, and that it asserted a right to the fund by assignment and by equitable lien, Fisher having defaulted in the payment of claims for labor and material. This motion for leave to intervene was sustained, over plaintiff's objection; thereafter an amended intervening petition was filed by leave, to which plaintiff filed its motion to dismiss and to set aside the original order permitting the intervention, on the ground that such amended petition did not state facts on which relief could be granted. That objection is preserved here, and it will be necessary to outline, briefly, the intervenor's claim; copies of pertinent documents were attached to the amended intervening petition as exhibits. Plaintiff, by answer, denied all substantive allegations of the amended intervening petition.
Fisher had, on March 2, 1954, entered into a contract with Laclede Electric Cooperative for the construction of a suboffice building at Waynesville, Missouri; the intervenor, whom we shall usually refer to as Century, executed the performance bond on that job, taking a written application and indemnity agreement; Fisher agreed to indemnify and save Century harmless from all loss and damages. Other provisions of the bond and application will be referred to in the course of this opinion. The contract provided for 'progress' payments as the work progressed, upon approval of the architect, and also for the retention by Laclede of 10% of the amount computed as due upon each payment until final completion and proof of the payment of all claims. The second progress payment so made was $8,878.50, and this (less a small withdrawal) constituted the fund attached. The check of Laclede was drawn to the order of 'H. R. Fisher, General Contractor.' With that payment Fisher opened a new account in the State Bank of Lebanon; he was introduced there by Mr. J. W. Haugh, General Manager of Laclede, but the account was opened and maintained merely in Fisher's name, with no restrictions on the bank's records. Mr. Haugh testified that he 'wouldn't feel we had any right to put any restrictions on the payment, unless there was a violation of the contract that covered it.' It was and is intervenor's claim that this money constituted, in effect, a trust fund for the payment of claims on the Laclede job and that it obtained, on Fisher's default, a prior equity and superior claim thereto, which related back to the date of its bond. It is agreed that Fisher defaulted in the payment of claims on the Laclede job also; that Century paid claims for labor and material totaling $14,163.12 (although it is not shown how much it received from Laclede), and that on the date of the present attachment (May 26, 1954) Fisher owed more than $10,000 in claims for labor and material furnished on the Laclede job. Fisher completed the construction of the Laclede building. Century took assignments of claims from the creditors whom it paid, beginning in October, 1954. No formal or declared default on this job was shown. Century also claimed considerable expense, but that is immaterial here, since the amounts paid by it on claims exceeded the amount of the deposit.
Plaintiff had originally filed in the same court its suit by attachment on May 11, 1954, but on motion of the defendant that attachment was dissolved on May 26, 1954; on the same day this suit was filed. The file in the former case was received in evidence.
At the trial it was agreed that the court should consider the issues in the following order: (a) the validity of the attachment; (b) plaintiff's claims against defendant Fisher; and (c) the merits of the controversy between plaintiff and the intervenor. At the conclusion of all the evidence, the case was taken under advisement; on February 16, 1956, the court entered judgment finding that Fisher was a nonresident of Missouri, sustaining the attachment on that ground only and finding against the other two grounds alleged, finding the issues for plaintiff on the merits as against defendant Fisher and assessing its recovery at $11,876.56, with interest, and finding the issues for the intervenor and against plaintiff on the intervention; the clerk was ordered to pay the deposit of $8,593.62 to the intervenor. In so ruling, the court found that the intervenor had 'an equitable lien and prior and superior claim and right' to the fund and its judgment established such lien and right. An after-trial motion for judgment, or for new trial, was filed by plaintiff; we need not digest it here, for it sufficiently raised plaintiff's present contentions; plaintiff also filed its exceptions to the failure of the court to sustain the attachment on all the grounds alleged. Defendant Fisher filed his motion for a new trial or to amend the judgment so as to find the issues for defendant, and, among other allegations, he asserted error in sustaining the attachment. All such motions were overruled. Plaintiff filed notice of appeal from 'that part of the judgment finding that plaintiff proved only the ground of non-residence under the attachment issue * * *,' and, generally, from the judgment in favor of the intervenor and against plaintiff on the merits. Defendant Fisher filed notice of appeal from the judgment and order sustaining the attachment and assessing plaintiff's recovery against defendant in the sum of $11,876.56. Defendant's appeal originally involved both the attachment issue and the merits of the final judgment against him.
After these appeals were taken, plaintiff and defendant stipulated that the personal judgment against defendant in the sum of $11,876.56, with interest and costs, should be final, that 'no appeal will be taken from that portion of said judgment,' but that defendant did not waive his right to appeal from the finding on the attachment issue, nor the plaintiff its rights on the issues found for the intervenor.
The questions now presented, though expressed in a multitude of forms, divide themselves into two categories, as follows: (1) was the attachment valid and properly sustained; and (2), did Century have a superior right and claim to the fund? We have determined that no appeal is properly before us on the attachment issue. The...
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