Peters v. Equitable Surety Company
| Decision Date | 16 February 1918 |
| Citation | 202 S.W. 530,273 Mo. 318 |
| Parties | CATHERINE PETERS v. EQUITABLE SURETY COMPANY, Appellant |
| Court | Missouri Supreme Court |
Appeal from St. Louis City Circuit Court. -- Hon. George H. Shields Judge.
Affirmed.
Boyle & Priest, Thomas M. Pierce and Chauncey H. Clarke for appellant.
(1) The court erred in refusing to give defendant's declaration of law in the nature of a demurrer to the evidence, both at the close of plaintiff's case and at the close of the whole case, for the reason that all the evidence showed that the railroad company failed to prosecute its appeal with due diligence, due to an agreement of compromise between the plaintiff and the railroad company, which agreement was a material variance from the original contract, thereby releasing defendant. Schuster v. Weiss, 114 Mo. 175; Bank v. United States, 164 U.S. 233, 238; Justice v. Surety Co., 209 F. 105; Barker v Surety Co., 184 S.W. 378. (2) The court erred in refusing to give defendant's declaration of law No. 8 declaring that if the appeal was dismissed pursuant to an agreement between plaintiff and the railroad company, then plaintiff was not entitled to recovery from defendant, for the reason set out above. Cases supra.
R. M. Nichols for respondent.
(1) If it could be said that the offer to abate $ 250 of the accrued interest would vary the surety's contract in the supersedeas bond to pay the judgment of $ 5,000 (which we challenge), this understanding was with the surety. The testimony shows that the surety acquiesced in the proposition to have respondent throw off part of the interest on her judgment, objecting only as to the method of carrying it out, and beyond all controversy the surety company, on November 5, 1913, knew by respondent's letter that respondent would abate $ 250 of the accrued interest and that the appeal had been dismissed, and that it was called upon to pay the judgment of $ 5,000 and half of the accrued interest. It, therefore, waived the defense which it is now attempting to make, not only by asking for an extension of time until the 10th of November in which to pay the judgment, but by its knowledge and acquiescence in the proposed settlement. Price v. Edwards, 11 Mo. 524; Lumber Co. v. Stoddard, 131 Mo.App. 15; Boppart v. Surety Co., 140 Mo.App. 675; Troll v. Realty Co., 186 Mo.App. 196; State v. McGonigal, 101 Mo. 353; Rule v. Anderson, 160 Mo.App. 347; Lumber Co. v. Surety Co., 124 Iowa 617; Williams v. Surety Co., 37 Am. & Eng. Ann. Cas. 681; Johnson v. Paltzer, 100 Ill.App. 171; Bell v. Mahin, 69 Iowa 48. (2) If it could be said that there was a dismissal of the appeal by agreement, that fact would not release the surety upon the supersedeas bond. Bailey v. Rosenthal, 56 Mo. 385; Howell v. Mill Co., 36 Neb. 80, 38 Am. St. 696; Bank v. Land Co., 119 Minn. 209; Chase v. Beraud, 29 Cal. 138; Share v. Hunt, 9 Serg. & R. 409; Drake v. Smythe, 44 Iowa 410; Ammons v. Whitehead, 31 Miss. 99; Ingersol v. Seatoft, 102 Wis. 476; Willis v. Chowning, 90 Tex. 617, 59 Am. St. 842; Boynton v. Phillips, 52 Ill. 210; Jacksonville Co. v. Hooper, 85 F. 620, 170 U.S. 704; 2 R. C. L., p. 316, sec. 272. (3) The offer to throw off $ 250 from the accrued interest was a mere accommodation offer. It was without consideration and binding in law upon no one. This would not release the surety. Fidelity & G. Co. v. Boyd, 29 Ky. L. R. 598; Quillen v. Quigley, 14 Nev. 215; Jacksonville Co. v. Hooper, 29 C.C.A. 385, 85 F. 220; Drake v. Smythe, 44 Iowa 410. (4) The surety upon the appeal bond was not a party to the suit so that respondent would be required to give it notice of the motion filed in the Court of Appeals on February 17, 1914. Notice was given to the appellant, the Frisco Railroad, and the surety was bound by whatever proceedings were had in the case. Bailey v. Rosenthal, 56 Mo. 385; Schwacker v. McLaughlin, 139 Mo. 341; Calhoun v. Gray, 150 Mo.App. 603; Brick Co. v. Neumeister, 15 Mo.App. 591. (5) The record shows that the appeal was dismissed by appellant; that thereafter, and upon motion of respondent, the dismissal was set aside and a judgment of affirmance entered by the Court of Appeals "for failure to duly prosecute said appeal." The Frisco Railroad and the Equitable Surety Company, as a party to the record, are bound by this judgment of affirmance, subsequently entered, against which no action was taken. A judgment against a principal is conclusive against the surety and is not subject to collateral attack. Brick Co. v. Neumister, 15 Mo.App. 592; McFall v. Dempsey, 43 Mo.App. 369; Calhoun v. Gray, 150 Mo.App. 59; American Club v. Horchitz, 168 Mo.App. 39; Butler v. Wadley, 15 Ind. 502; Supreme Council C. B. L. v. Boyle, 15 Ind.App. 342; Piercy v. Piercy, 56 N.C. 214; Ingersol v. Seatoft, 102 Wis. 472; Thixton v. Goff, 5 Ky. L. R. 764; Tracy v. Maloney, 105 Mass. 90; White v. Prigmore, 29 Ark. 208; Shannon v. Dodge, 18 Col. 164; Hathaway v. Davis, 33 Cal. 161; Keithsbury v. Henry, 90 Ill. 255; Seymour v. Smith, 114 N.Y. 481; Huidepoker v. Fidelity & D. Co., 180 F. 292; Murison v. Butler, 20 La. Ann. 512; Murdock v. Brooks, 38 Cal. 601. (6) Appellant was not released of its obligation by a dismissal of the appeal by the St. Louis Court of Appeals. By such dismissal its liability became fixed, and when that court set aside the judgment of dismissal and entered an order affirming the judgment, its liability again became fixed. It was at no time released, and therefore was not deprived of its property without due process of law. Trust Co. v. Corbin, 192 Mo.App. 153; Casualty Co. v. Mining Co., 192 Mo.App. 337.
The plaintiff recovered against the defendant as surety on an appeal bond, the judgment from which the defendant appeals.
On March 12, 1912, the plaintiff obtained judgment against the St. Louis & San Francisco Railroad Company for five thousand dollars. From this judgment the Railroad Company appealed to the St. Louis Court of Appeals, and gave bond in the usual form in the sum of $ 10,200, with this defendant, Equitable Surety Company, as surety.
On November 4, 1913, during the next term of said Court of Appeals, the Railroad Company dismissed its appeal. The Railroad Company in the meantime had been ordered into the hands of receivers. After the appeal was dismissed the plaintiff brought suit against the Surety Company, defendant here, upon the appeal bond. While that suit was pending, the respondent ran across a recent decision of the Springfield Court of Appeals holding that the dismissal of an appeal was not a breach of the bond in such case and would not make the surety liable. The plaintiff then filed a motion in the St. Louis Court of Appeals asking that court to set aside the dismissal of the appeal and reinstate the case. This was done at the same term of the court, on January 20, 1914, and on February 17, 1914, at the same term, that court affirmed the judgment of the circuit court for failure to prosecute the appeal. The plaintiff then dismissed the pending suit on the appeal bond, and filed the present suit, alleging as a breach of the bond the affirmance of the judgment and the failure of the appellant Railroad Company to comply with and perform same.
The answer of the defendant in this case, in addition to a general denial, alleged that the defendant Railroad Company and the plaintiff, without the knowledge or consent of the surety, entered into a collusive agreement for a compromise judgment in the Court of Appeals, and that the appeal was dismissed by the plaintiff in pursuance of that agreement, whereby the surety was released from obligation on the bond.
The answer further alleged that after the appeal was dismissed in the Court of Appeals, as mentioned, the plaintiff caused the same to be reinstated and the judgment of the circuit court to be affirmed, without notice of any kind to defendant herein, and if the judgment were enforced defendant would be deprived of its property without due process of law, and was in violation of Article 2, Section 30, of the Constitution of Missouri.
The judgment of the circuit court was for $ 10,200, the penalty of the bond, with an assessment of the plaintiff's damages at $ 5,000 and interest from the date of the judgment.
On the trial of the case records were introduced to show the proceedings as above stated, and that execution had been issued and no part of the judgment had been paid.
The defendant then attempted to show the agreement set up in the answer.
While the appeal was pending R. M. Nichols, attorney for plaintiff, and Mr. Lon Hocker, who represented the Railroad Company, had one or more conversations looking to a compromise of the case. Finally they agreed to settle the case for the face of the judgment and one-half the accrued interest and costs -- the interest at that time amounting to $ 500 -- the amount to be paid to plaintiff in the settlement being $ 5,250. It appears from the testimony of both Mr. Nichols and Mr. Hocker that in pursuance of the arrangement the Surety Company was to be consulted and requested to pay the amount agreed upon. The conversation in which this agreement was reached, according to the testimony of Mr. Nichols, took place on the 4th of November, 1913, and immediately, on the same day, Mr. Hocker dismissed the appeal in the Court of Appeals.
The next day Mr. Nichols addressed a letter to the Surety Company relating the agreement and stating that Mr. Hocker had told him to write to the company and it would send him a check for the amount. After this letter was written Mr. Nichols had several telephone conversations with Mr. Geisinger, a clerk or bookkeeper in the office of the Surety Company, and with Mr. Maloney who, it appears, was the person in authority....
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