Smith Engineering Works v. Custer

• Decision Date: 09 May 1944
• Docket Number: 30521.
• Citation: 151 P.2d 404,194 Okla. 318,1944 OK 211
• Parties: SMITH ENGINEERING WORKS v. CUSTER et al.
• Court: Oklahoma Supreme Court

151 P.2d 404

194 Okla. 318, 1944 OK 211

SMITH ENGINEERING WORKS v. CUSTER et al.

No. 30521.

Supreme Court of Oklahoma

May 9, 1944

Rehearing Denied Sept. 12, 1944.

Syllabus by the Court.

1. An action predicated upon the provisions of 62 O.S.1941 § 479 fixing liability against a member of a board of county commissioners for the purchase of merchandise in excess of the revenue provided therefor, is remedial in nature instead of penal, and the 4th subdivision of 12 O.S.1941 § 95, has no application thereto.

2. Under Title 62 O.S.1941 § 479, it is made unlawful for a county commissioner to make any contract for, incur acknowledge, approve, allow or authorize any indebtedness in excess of the estimate made and approved for such purpose and for a violation thereof, such commissioner and his bondsmen are liable in a civil action.

3. Section 9, Chapter 80, Session Laws of 1910-11, same being Title 62 O.S.1941 § 479, authorizing a civil action against a county commissioner and his bondsmen to collect for merchandise purchased by said commissioner in excess of the revenue provided therefor, examined and held not violative of Section 57, Article 5, of the Constitution.

Appeal from District Court, Pawnee County; Prentiss E. Rowe, Judge.

Action by the Smith Engineering Works, a corporation, against Charles I. Custer, County Commissioner of Pawnee County, and another, for the value of merchandise sold by plaintiff to such county on named defendant's order. Judgment for defendants, and plaintiff appeals.

Reversed and remanded.

HURST J., dissenting.

B. M. Parmenter, of Oklahoma City, for plaintiff in error.

W. Lee Johnson, of Pawnee, for defendants in error.

OSBORN Justice.

This action was instituted in the district court of Pawnee County by the Smith Engineering Works, hereinafter referred to as plaintiff, against Chas. I. Custer, county commissioner of Pawnee County, and his official bondsmen, the Standard Accident Insurance Company, hereinafter referred to as defendants, wherein plaintiff sought judgment for the value of merchandise sold and delivered to Pawnee County upon the order of the defendant commissioner, it appearing that the appropriation had been exhausted at the time the goods were sold and delivered to the county.

The action was instituted in the trial court on December 28, 1940.

The amended petition of plaintiff in its first cause of action alleges that "Chas. I. Custer, as Pawnee County Commissioner District No. 2," ordered from plaintiff on March 20, 1939, by telegram and letter certain repair parts "acting as County Commissioner of District No. 2 of Pawnee County, Oklahoma;" that the indebtedness in the sum of $108.05 "created and attempted to be created by the defendant, Chas. I. Custer, acting as County Commissioner of District No. 2 of Pawnee County, Oklahoma, was in an amount exceeding in said year, 1939, the income and revenue provided for such year, the same was done without the assent of three-fifths of the voters thereof, and it was the incurring, acknowledging and authorizing of an indebtedness against the said Pawnee County, Oklahoma, in excess of the estimate made and approved by the Excise Board for the current fiscal year within which the said indebtedness was contracted and incurred by the said defendant, Chas. I. Custer."

In the second cause of action the plaintiff adopts the allegations of the first cause and alleges that "at the special instance and request of this defendant, Chas. I. Custer, Commissioner, Pawnee County, District No. 2," it sold certain goods, wares and merchandise in the sum of $516.32.

It is further alleged that said material so purchased has not been paid for.

In the third cause of action it is alleged that the defendant commissioner executed an official bond with Standard Accident Insurance Company as surety for the term, beginning July 1, 1937, and ending July 1, 1939, and "that said bond provides 'the condition of the above obligation is such, that if the above bounden principal shall well and faithfully perform all the duties of his said office during the term as aforesaid, as required by law, then this obligation shall be null and void; otherwise to be and remain in full force and virtue;"' that defendant commissioner has not faithfully performed the duties of his said office as required by law, "in that in attempting and pretending to perform the duties of his said office he violated the law in the respects and manner set out in the aforesaid First and Second Causes of Action;" and that the surety by the terms of said bond is obligated and bound to pay the plaintiff.

Verified copies of the two accounts and a copy of the bond are attached to the petition as exhibits.

To this petition the defendants filed separate demurrers alleging that the petition and each of the several causes of action does not state facts sufficient to constitute a cause of action in favor of the plaintiff and against the defendants, and that the petition shows on its face that the alleged causes of action are barred by the statute of limitations. The demurrers being sustained, the plaintiff elected to stand upon its petition, judgment was entered in favor of defendants, and plaintiff has appealed.

The action is predicated upon 12 O.S.1941 § 76, as supplemented by 62 O.S.1941 § 479.

Said Section 76 reads as follows:

"When an officer, executor or administrator within this State, by misconduct or neglect of duty, forfeits his bond or renders his sureties liable, any person injured thereby, or who is, by law, entitled to the benefit of the security, may bring an action thereon in his own name, against the officer, executor or administrator and his sureties, to recover the amount to which he may be entitled by reason of the delinquency. The action may be instituted and proceeded in on a certified copy of the bond, which copy shall be furnished by the person holding the original thereof."

62 O.S.1941 § 479, so far as material here, provides:

"It shall be unlawful for the board of county commissioners *** or any member or members of the aforesaid commissioners, *** to make any contract for, incur, acknowledge, approve, allow or authorize any indebtedness against their respective municipality or authorize it to be done by others, in excess of the estimate made and approved by the excise board for such purpose for such current fiscal year, ***. Any such indebtedness, contracts incurred, acknowledged, approved, allowed or authorized in excess of the estimate made and approved for such purposes for such current fiscal year ***, shall not be a charge against the municipality whose officer or officers contracted, incurred, acknowledged, approved, allowed or authorized or attested the evidence of said indebtedness, but may be collected by civil action from any official contracting, incurring, acknowledging, approving or authorizing or attesting such indebtedness, or from his bondsmen."

It is noted that the action was instituted more than one year (but within three years) after the purchase of the merchandise. Our general statute of limitations is 12 O.S.1941 § 95. The second subdivision of the statute fixes a period of three years for the institution of "an action upon a liability created by statute other than a forfeiture or penalty." The fourth subdivision fixes a period of limitations of one year for "an action upon a statute for penalty or forfeiture, except where the statute imposes and prescribes a different limitation." Under the fifth subdivision of the statute an action on an official bond "can only be brought within five years after the cause of action shall have accrued."

The trial court was of the view that the fourth subdivision was applicable in that the present action was upon a statute for penalty, and relied upon our decision in the case of Battles v. Connor, 182 Okl. 613, 79 P.2d 232. In that case a county treasurer and his surety were sued by the holder of certain warrants to recover the amount thereof as authorized by 62 O.S.1941 § 477, which section makes it unlawful for the treasurer to register a warrant in excess of the estimate made and approved by the excise board and authorizes an action by the warrant holder against the treasurer and his surety to recover the amount of the warrant. Said decision, whether correct or erroneous, is not controlling herein, for we must construe other sections of the statutes. But on further careful consideration of that case, we are convinced that the reasoning therein is faulty, and that insofar as same conflicts herewith it should be disapproved.

The case of Battles v. Connor, supra, relies to some extent upon certain language incidentally used by this court in Carey, Lombard, Young & Co. v. Hamm, 61 Okl. 174, 160 P. 878, and in Board of Com'rs v. Western Bank & Office Supply Co., 122 Okl. 244, 254 P. 741, in neither of which cases was the determinative question herein involved. We believe also that the applicable statutes serve to distinguish the North Dakota case of St. Anthony & D. Elevator Co. v. Martineau, 30 N.D. 425, 153 N.W. 416, relied upon in said opinion, since said statutes differ in many respects from ours.

The rule is stated in 1 Am.Jur., Sec. 39, p. 431, as follows:

"*** A penal action is one founded entirely upon the statute, the only object of which is to recover a penalty or a forfeiture imposed as a punishment for a certain specific offense. Remedial actions are those which are brought to obtain compensation or indemnity. Accordingly, where damages imposed by statute are given wholly to the party injured as compensation for the wrong and injury, the statute having for its object indemnification rather than punishment, the action to recover such damages is remedial in its nature. ***"

We...