O'Neal v. Turner

• Decision Date: 24 January 1935
• Docket Number: 4 Div. 787.
• Citation: 230 Ala. 24,158 So. 801
• Parties: O'NEAL et al. v. TURNER, County Treasurer.
• Court: Alabama Supreme Court

158 So. 801

230 Ala. 24

O'NEAL et al. v. TURNER, County Treasurer.

4 Div. 787.

Supreme Court of Alabama

January 24, 1935

Rehearing Denied Feb. 21, 1935.

Appeal from Circuit Court, Covington County; Emmet S. Thigpen Judge.

Action on bond by G. M. Turner, as Treasurer of Covington County against Dudley L. O'Neal, as administrator of the estate of C. S. O'Neal, deceased, T. E. Henderson, Minnie M Milligan, and others. From a judgment granting plaintiff's motion for a new trial, defendants O'Neal and Henderson appeal, and plaintiff takes cross-appeal as to defendant Milligan.

Reversed and rendered on direct appeal. Affirmed on cross-appeal.

Powell, Albritton & Albritton, of Andalusia, for appellants.

Mulkey & Mulkey, of Geneva, and E. O. Baldwin, of Andalusia, for appellee (cross-appellant).

A. R. Powell, of Andalusia, for cross-appellee.

GARDNER Justice.

On December 14, 1931, the county commissioners of Covington county, pursuant to the authority of section 322, Code 1923, elected G. M. Turner as treasurer for the county, fixed the amount of his official bond, and concluded the order by directing that "all funds coming into his hands shall be deposited in the Andalusia National Bank."

Turner had in previous years, as county treasurer, been making his deposits in said bank, and continued to do so. He desired, however, an indemnity bond, and prepared one in his office, and delivered it to R. N. McLeod, its president, for its execution with acceptable sureties. His later testimony as to what he did with the bond is not now of controlling importance.

In October, 1932, the bank closed its doors and went into the hands of the liquidating agent of the government; Turner, as county treasurer, having to his credit at the time something in excess of $35,000. The bond which was delivered by McLeod to Turner bore the signature of C. A. O'Neal, R. N. McLeod, T. E. Henderson, Minnie M. Milligan, and C. S. O'Neal, as sureties. The evidence indicates the bond was so delivered about the first of April or the middle of May, Turner finally stating the best he could say was that it was prior to the first of April. On July 7, 1932, C. S. O'Neal left his office and was sick continuously until his death on August 1, 1932. His son Dudley O'Neal is administrator of his estate. Turner, as county treasurer, brought suit against said administrator and the individual sureties above named on the indemnity bond.

Those defendants involved on this appeal interposed the defense of conditional delivery, as evidenced by plea 15, to which plaintiff interposed replication 4, in effect an estoppel. Defendant Henderson interposed also his plea of non est factum. On the issues as thus presented, the case was submitted to the jury, resulting in a verdict for all defendants.

Upon plaintiff's motion for a new trial, the court granted the same, and set aside the verdict as to defendants Dudley O'Neal, as administrator, and T. E. Henderson. The trial judge gave his reasons therefor, and thus specified the ground upon which the motion was granted. As to Henderson he concludes that this defendant did not sustain by his proof his plea 15, "neither did he sustain his plea of non est factum. * * * Therefore, the verdict and judgment should be set aside as to him." As to defendant administrator is the following:

"Now, as to the defendant Dudley L. O'Neal, as administrator of the estate of C. S. O'Neal, deceased, * * * it will be noted that his special plea (plea 15) not only alleges that the instrument was signed under the conditions set forth, but goes further and alleges:

"'That said bond, or contract, should not be delivered to the plaintiff, until signed by J. D. Henderson, whose name the said Andalusia National Bank, by and through its president, R. N. McLeod, agreed to have affixed to said bond before it was delivered to the plaintiff.'

"This part of the plea clearly was not sustained by the evidence. Neither the testimony of Dudley L. O'Neal, or R. N. McLeod, proves this part of the plea. In fact, to the contrary, the testimony of R. N. McLeod shows that this part of the plea was not proven."

As to the defendant Minnie M. Milligan, the motion was denied, with the following comment: "As to Mrs. Minnie M. Milligan, as stated above, the plaintiff concedes that the testimony sustains her plea, and in this, the court concurs."

Dudley L. O'Neal, as administrator, and T. E. Henderson have appealed from the judgment granting plaintiff's motion for a new trial, and plaintiff prosecutes a cross-appeal from the judgment on the ruling denying his motion as to Mrs. Milligan. We are therefore concerned on this appeal with only these three defendants, considered here in the order of their presentation in brief.

It may be observed at the outset that the court's ruling rested upon no question involving the weight of the evidence, but as to defendants O'Neal and Henderson, the effect of the ruling was that plaintiff was entitled to the affirmative charge against them, thus presenting a question of law or its application to the proven facts.

It is the general rule that "a plain error of law in granting or refusing a new trial cannot be aided by any presumption of correct action" (4 Corpus Juris, 782), and this rule is embodied in our statute granting appeals from rulings on motions for a new trial. Section 6088, Code 1923.

It is the further rule, in harmony, we think, with sound reasoning, that the court, having specified the grounds on which the order is based, will be presumed to have acted on those grounds alone, and to have overruled or disregarded other grounds. 4 Corpus Juris, 785.

The review here, therefore, is in accord with the generally recognized rule, as well as our statute, unaided by any presumption as to the correctness of the ruling of the trial court. Plea 15 (substantially the same as to each of these defendants) is to the effect that the bond was signed by defendant as surety upon the express condition that it should not be delivered until the signature of J. D. Henderson was secured. That this is here a valid defense is well settled, and, indeed, uncontroverted.

The reasoning of the court is that the surety being under no obligation to sign the bond at all, his signature, being his own voluntary act, and under no obligation to deliver a bond which he had signed for the accommodation of the principal obligor, may put such limitations and conditions upon his favor as seem to him proper or to his interest. "The whole matter is at large with him, and, having constituted the principal obligor his agent to deliver the bond, he may impose whatever conditions he chooses upon the act of his agent. * * * The thing to be done not being at all obligatory on him, he can decline to do it absolutely, and he may do it upon whatever conditions, capricious or otherwise, he may elect to impose. * * * If any condition is deemed too onerous, or unreasonable, or impossible, even, of performance, the holder in escrow is not thereby authorized to deliver to the obligee. He has no authority whatever to deliver until the condition, whatever it may be, has been complied with." White Sewing Machine Co. v. Saxon et al., 121 Ala. 399, 25 So. 784, 787. To like effect, also, are the cases of McConnon & Co. v. Kirby, 211 Ala. 440, 100 So. 764, 765; Birmingham News Co. v. Moseley, 225 Ala. 45, 141 So. 689.

Nor is it essential that the obligee have notice of the conditional delivery, or that he consented thereto. Whatever may be the rule in other jurisdictions, it is the established law under our decisions that "the obligee is required at his peril to ascertain the scope of the powers of the agent." In McConnon & Co. v. Kirby, supra, speaking to this question, the court said: "It is a law of contracts probably applied daily in business affairs.

If there should be a change, it must come by legislation."

The applicable law therefore is clear, and, indeed, uncontroverted. The important question remains whether or not the plea is sustained by the proof.

Considering first the defense of C. S. O'Neal, interposed by the administrator of his estate: The bond was carried by McLeod, the bank president, to C. S. O'Neal for signature, and his son Dudley L. O'Neal was present at the time. O'Neal at first demurred and finally signed after much hesitancy. But before signing, however, he was assured by McLeod that the signature of J. D. Henderson (known also as Dink Henderson) would also be secured as surety. The following excerpt from the testimony of Dudley L. O'Neal will illustrate: "My father then told him: 'Mr. Dink Henderson hasn't signed this bond yet.' Mr. McLeod told him: 'Well, we are going to get him to sign it.' Finally my father told him: 'I am going to sign the bond, and if Mr. Dink Henderson don't sign this bond, I don't want it delivered, * * * said he wanted it torn up-didn't want it delivered.' He was very stern in what he was telling him. * * * In answer to that, Mr. McLeod told him he was going to ask J. D. Henderson-Dink Henderson-to sign it-was going to leave it over there with Mr. Trammell (who, we interpolate, is T. E. Henderson) to get him to sign it. My father signed the bond and told him that." The testimony of Mr. McLeod is in no manner contradictory of that of Dudley L. O'Neal, but, on the contrary, is corroborative thereof, saying, in part: "Mr. O'Neal signed that bond, and told me that he wanted Mr. Dink Henderson to sign it, and that he must do it. I do remember an expression which Mr. O'Neal used, in which he was very emphatic-he said he must-sure sign it."

It was not of course necessary that O'Neal use the language of the books, and expressly state to McLeod that his signature was "upon condition." Suffice it for all practical...