School Dist. No. 45 of Pemiscot County v. Correll

• Decision Date: 17 July 1926
• Docket Number: No. 3926.,3926.
• Parties: SCHOOL DIST. NO. 45 OF PEMISCOT COUNTY v. CORRELL.
• Court: Missouri Court of Appeals

286 S.W. 136

SCHOOL DIST. NO. 45 OF PEMISCOT COUNTY v. CORRELL.

No. 3926.

Springfield Court of Appeals. Missouri.

July 17, 1926.

Appeal from Circuit Court, Pemiscot County; Henry C. Riley, Judge.

Action by School District No. 45 of Pemiscot County against Arthur A. Correll. Judgment for plaintiff, and defendant appeals. Affirmed.

Shepard & Hawkins, of Caruthersville, for appellant.

Ward & Reeves, of Caruthersville, for respondent.

BAILEY, J.

This action is brought by a common school district against the county treasurer to recover funds wrongfully and illegally paid out by him. On trial to a jury the verdict was for plaintiff in the sum of $1,411.20, and from the judgment thereon defendant has appealed.

The petition alleges that defendant, as the duly elected and qualified treasurer of Pemiscot county, was the legal custodian and had possession of the school funds belonging to the various school districts of the county: that it was the duty of defendant to pay out the funds of the districts only upon warrants drawn thereon duly and legally issued by order of the boards of directors of the districts, and especially plaintiff district; that it was the duty of defendant to not pay out the funds of plaintiff district in his custody, except upon legally and properly drawn warrants duly signed by the president of the plaintiff school board and by the clerk thereof; that defendant wrongfully paid out of the funds in his hands belonging to plaintiff district large sums of money upon warrants not ordered by the school board and not signed by the president, which warrants are in said petition fully set out. The petition further alleges that the warrants were drawn without the knowledge or consent of the president or board of directors of plaintiff and that defendant is indebted to plaintiff in the sum of $1,275.98, which has been demanded of defendant, but payment has been refused.

The answer pleads as a bar that plaintiff has no capacity to sue and is without authority to maintain this suit; that defendant made regular settlements with the county court of plaintiff's funds, which were duly approved by that body; that plaintiff district permitted the president's name to be signed by the clerk during a period of 5 years and that the loss to the district, if any, was brought about by such method of transacting its business; that the president failed to record his signature in the office of the county treasurer as required by law; and that plaintiff is now estopped by its own conduct from holding this defendant liable for damages:

Numerous errors are assigned, which we shall consider in so far as may be necessary to a proper determination of the issues.

It is first contended that, before a warrant properly drawn is presented to the treasurer and refused, he is not in default until his term of office expires and he fails to turn over to his successor the funds due the district. It is admitted that no such warrant was issued, but written demand, in the form of a letter, was made on the treasurer and payment refused. Appellant relies on two cases to support his contention, viz.: State ex rel. v. Thomas, 17 Mo. 503; State ex rel. v. Dent, 121 Mo. 162, 25 S. W. 924.

The Thomas Case was a suit brought by Oregon county against the county treasurer and his securities on his official bond. Under the statute then in force, the county treasurer could only pay out moneys in the county treasury by warrants drawn on him by order of the county court. There was no averment in the petition that the county ever made an order or drew a warrant for the amount in controversy or that he ever refused to disburse money when properly required. It was held the breaches of the bond were insufficiently assigned in the petition.

The Dent Case was a suit by the county against the county clerk on his official bond for arrearage. Section 5626, R. S. Mo. 1879, provided that the county court should ascertain the amount of excess fees retained and make an order directing the clerk to pay same into the county treasury. It was held that, "whenever a particular and statutory method of proceeding is pointed out as the one to be pursued, then such method is exclusive," and that, since the county court failed to comply with the statute, the conditions of the bond were not broken.

In the case at bar the county treasurer failed to give a bond as custodian of the school moneys, which he was required to do. Section 11188, It. S. Mo. 1919. No suit could therefore be maintained on his bond as was done in the two cases cited.

Section 11188, supra, also provides that money shall be "paid out" on warrants duly issued by order of the board of directors. Hence, it is argued, this suit cannot be maintained against the county treasurer because no such warrant was ordered and the treasurer is, therefore, not in default. We do not consider the Thomas and Dent Cases authority for the contention made in this case. In those snits the decisions were based on a construction of the statutes relative to a breach of the conditions of the bonds on which suits were brought. The bonds were statutory and the directions of the statute were held mandatory. The present suit is not bottomed on the statute. It is an action to recover money wrongfully paid out. No rights of securities are involved. What useful or reasonable excuse can there be for requiring the school board to first draw a warrant on the treasurer for the amounts he has paid out on invalid warrants? The warrants which he is charged with having wrongfully paid are fully set out and no advantage can be taken of him in that respect. The statute requiring money to be paid out only on warrants does not cover the situation here, but refers to disbursements of the district's funds made in the regular way in the due course of business, which can only be made on proper warrants. The money judgment sought here is not for a failure to pay a warrant, but to recover money improperly paid. In a sense, the relief asked is against the treasurer personally and not in his official capacity. He is not required to "pay out" the districts' money, but out of his own private property to reimburse the district.

Under section 11197, R. S. Mo. 1919, plaintiff district is constituted a body corporate and is capable of suing and being sued. This cause of action, as we view it, being wholly independent of the statute requiring warrants to be first drawn, we are unable to discover any legal impediment to the maintenance of this action by the school district in so far as the statutes are concerned. State ex rel. v. Chick, 146 Mo. loc. cit. 654, 48 S. W. 829; State ex rel. v. Henderson, 142 Mo. loc. cit. 605, 44 S. W. 737.

It is further contended that this action could be brought only by the county clerk or some freeholder. This contention is based on certain provisions found in section 11188, supra, as follows:

"On the forfeiture of such bond [of the treasurer] it shall be the duty of the county clerk to collect the same for the use of the schools in the various districts. If such county clerk shall neglect or refuse to prosecute, then any freeholder may cause prosecution to be instituted."

We construe this section to apply only to actions on the bond of the treasurer. There is not a word in the statute authorizing the clerk or freeholder to institute a suit except to collect the amount due on the bond. Since there was no bond no such action could be maintained. There is good reason for limiting the power of the clerk or freeholder to the bond itself. The bond required is given for the benefit of all the districts in the county. It is, therefore, proper that one person or official should have authority to bring the suit on the bond in order to avoid multiplicity of suits. But, where there is no bond and the suit affects only one district, the reason for vesting the exclusive power in the clerk or freeholder vanishes. We therefore hold against appellant on this contention..

Error is assigned in the refusal of the trial court to permit appellant to introduce testimony tending to prove that plaintiff district had for a number of years permitted one C. A. Wells to, issue warrants for the valid obligations of the district by signing the president's name, which warrants were executed in the same manner as the warrants sued on in this case. It is not contended that the directors authorized Wells to sign and issue such warrants by any formal or recorded action, but that they permitted Wells to do so with their knowledge and consent for such period of time as to cause such acts to become a rule of action between the plaintiff school board and defendant treasurer. The evidence offered was rejected on the theory, as we understand, that estoppel would not lie against the district. No attempt was made to prove that J. C. Clark, president of the school board at the time the warrants in controversy were issued, individually authorized Wells, as clerk, to sign his (the president's) name to such warrants; nor is it contended that the statute, which requires all warrants to be signed by the president of the board, was complied with. The evidence offered and the defense pleaded, as we gather from the record, is based solely on the proposition that the manner of transacting business over...