Pundmann v. Schoeneich

• Decision Date: 17 May 1898
• Citation: 144 Mo. 149,45 S.W. 1112
• Parties: PUNDMANN et al. v. SCHOENEICH.
• Court: Missouri Supreme Court

45 S.W. 1112

144 Mo. 149

PUNDMANN et al. v. SCHOENEICH.

Supreme Court of Missouri, Division No. 2.

May 17, 1898.

FOLLOWING TRUST FUNDS — CITY TREASURER — LIABILITY OF BONDSMEN.

1. When entering on his second term, a city treasurer, in his settlement, charged himself with a certain sum. On his death, three months later, the amount of his shortage was ascertained by adding to this balance the sums he afterwards received, and deducting the warrants he had paid out. Held, that his sureties for his second term were liable for the amount which his own official books thus showed him to be owing.

2. Funds of a city treasurer misappropriated with the full knowledge and consent of his partners remains a trust fund in the hands of the firm, and of its administrator after dissolution.

3. The fact that trust funds are not clearly traceable to any particular asset of an insolvent estate does not release the estate from the charge of the trust.

Appeal from circuit court, St. Charles county; E. M. Hughes, Judge.

Suit by William Pundmann and others against Henry J. Schoeneich, administrator of the partnership estate of S. H. Merten & Co. There was a decree for plaintiffs, and defendant appeals. Affirmed.

C. Daudt, for appellant. Theodore Bruere & Son, for respondents.

GANTT, P. J.

Plaintiffs were the securities on the bond of John F. Hackmann, the treasurer of the city of St. Charles. Hackmann was a member of the firm of S. H. Merten & Co., composed of Stephen H. Merten, William Hackmann, and John F. Hackmann, which firm operated a steam flour mill and did a general milling business. John F. Hackmann was the bookkeeper and general manager of the concern, and, as such, received and paid out all moneys of the firm. With the full knowledge and consent of his partners, John F. Hackmann put the city's money, which he had received as treasurer, into the partnership business. He was twice elected treasurer of the city, his first term being for the years 1891 and 1892, and his second term for the corporate years 1893 and 1894. He qualified on the 18th day of April, 1893, and executed his bond in the penal sum of $30,000, wherein he was principal, and S. H. Merten, William Hackman, William Pundmann, Henry Gronefeld, F. W. Banze, Herman D. Bruns, and A. R. Huning as sureties. John F. Hackmann took charge of and administered the office until his death, on September 18, 1893. He deposited some of the city's money in the three banks of the city of St. Charles, but by far the greater portion was deposited by him in the Union Savings Bank, in his firm's name, or was mixed with the firm's money in their drawer at the mill. When city warrants were presented, he or his partners would pay them out of said drawer or with firm checks on the Union Savings Bank. At the date of his death, $1,039.04 of the city money was found deposited in the three banks to the credit of the city, and it was found that he was a defaulter to the amount of $4,417.70. This sum the plaintiffs, who were his sureties, after a full investigation, paid to the city; the other two sureties, Merten and Hackmann, being insolvent. The children of John F. Hackmann afterwards voluntarily paid the plaintiffs $525, thus leaving $3,892.70 due plaintiffs. The partnership estate of S. H. Merten & Co. is insolvent, paying about 24 cents on the dollar. At the time of the trial, in December, 1894, the administrator had received in cash due said estate $20,536.84, of which $12,873.67 had been collected by him on accounts and notes due the firm. The plaintiffs brought this action in equity to have the said balance of $3,892.70 declared a trust fund, and ask to be subrogated to the equitable right of the city, and to require said administrator of the partnership estate to allow and pay the same as a preferred demand. The administrator, for answer, admits that he is administrator of the partnership estate, and that he has a large fund belonging to said estate, amounting to $10,000; otherwise denies each and...