State, ex rel. Davis v. Farmers & Merchants Bank of Morrill

• Court: Nebraska Supreme Court
• Writing for the Court: DAY, J.
• Citation: State, ex rel. Davis v. Farmers & Merchants Bank of Morrill, 206 N.W. 759, 114 Neb. 217 (Neb. 1925)
• Decision Date: 31 December 1925
• Docket Number: 24429
• Parties: STATE, EX REL. CLARENCE A. DAVIS, ATTORNEY GENERAL, v. FARMERS & MERCHANTS BANK OF MORRILL. NATIONAL SURETY COMPANY OF NEW YORK, APPELLANT, v. FARMERS & MERCHANTS BANK OF MORRILL ET AL., APPELLEES

206 N.W. 759

114 Neb. 217

STATE, EX REL. CLARENCE A. DAVIS, ATTORNEY GENERAL, v. FARMERS & MERCHANTS BANK OF MORRILL.

NATIONAL SURETY COMPANY OF NEW YORK, APPELLANT, v. FARMERS & MERCHANTS BANK OF MORRILL ET AL., APPELLEES

No. 24429

Supreme Court of Nebraska

December 31, 1925

APPEAL from the district court for Scotts Bluff county: P. J BARRON, JUDGE. Reversed, with directions.

REVERSED.

Honnold & Clark and J. M. Fitzgerald, for appellant.

C. M Skiles and Mothersead & York, contra.

Heard before MORRISSEY, C. J., DAY, GOOD, THOMPSON and EBERLY, JJ.

OPINION

DAY, J.

In the receivership of the Farmers & Merchants Bank of Morrill, Nebraska, the National Surety Company of New York filed its claim and asked that it be allowed as a preferred claim and paid out of the depositors' guaranty fund. The trial court refused to allow the claim as one payable out of the guaranty fund, but allowed it with some deduction as a general claim against the bank. From this judgment the claimant appeals.

The facts are not in dispute. The record shows that on June 15, 1921, the Farmers & Merchants Bank of Morrill, as principal, and the National Surety Company of New York, as surety, executed and delivered to the county of Scotts Bluff a bond in the sum of $ 10,000. Generally speaking, the provisions of the bond were to indemnify the county against the loss of money deposited in the bank by the county treasurer in excess of 50 per cent. of the paid-up capital of the bank; that the bank would pay interest at 2 per cent. on the amount of the deposits, based on the average daily deposits, and would repay the entire sum deposited upon written demand of the county treasurer.

During the term of the bond, and on August 16, 1922, the bank failed and a receiver was duly appointed to wind up its affairs. At the time of the failure of the bank, the treasurer of Scotts Bluff county had on deposit in the bank $ 14,722.26 belonging to the county, of which some $ 1,097.26 was in excess of 50 per cent. of the capital of the bank and was money protected by the bond. The county treasurer filed a claim with the receiver for the entire amount on deposit and asked that the claim be allowed as a preferred claim and paid out of the guaranty fund. On March 19, 1923, the court allowed the claim to the extent of $ 13,625 as a preferred claim and ordered it paid out of the guaranty fund. As to the balance, $ 1,097.26 the court deferred...