State, ex rel. Davis v. State Bank of Gering

• Citation: 206 N.W. 758,114 Neb. 213
• Decision Date: 31 December 1925
• Docket Number: 24430
• Parties: STATE, EX REL. CLARENCE A. DAVIS, ATTORNEY GENERAL, v. STATE BANK OF GERING. NATIONAL SURETY COMPANY OF NEW YORK, CLAIMANT, APPELLANT, v. STATE BANK OF GERING ET AL., APPELLEES
• Court: Supreme Court of Nebraska

206 N.W. 758

114 Neb. 213

STATE, EX REL. CLARENCE A. DAVIS, ATTORNEY GENERAL, v. STATE BANK OF GERING.

NATIONAL SURETY COMPANY OF NEW YORK, CLAIMANT, APPELLANT, v. STATE BANK OF GERING ET AL., APPELLEES

No. 24430

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.

The State Bank of Gering, located at Gering, Nebraska, became insolvent and closed its doors September 28, 1922. Thereafter in a proper proceeding a receiver was duly appointed to take charge of the assets of the bank and to wind up its affairs. During the course of the receivership the National Surety Company of New York filed a claim with the receiver for $ 10,764.02 and asked that it be allowed as a preferential claim and paid out of the guaranty fund. The receiver objected to the claim being allowed as a preferred claim. At the conclusion of the testimony the trial court refused the claim as a preferred claim, but allowed it as a general claim. From this judgment the claimant has appealed.

At the time the bank failed P. M. Schmidt, the county treasurer of Scotts Bluff county, had on deposit in the bank, in his official capacity, $ 49,505.02.

It appeared that on June 8, 1921, the State Bank of Gering, as principal, and the National Surety Company of New York, as surety, executed a bond in favor of the county of Scotts Bluff in the sum of $ 10,000. Generally speaking, the provisions of the bond were to indemnify the county for 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 2 per cent. interest on the amount, based on the average daily balances, and would pay the entire sum upon the written demand of the county treasurer.

At the time of the failure of the bank, and during the term of the bond, the county treasurer had on deposit in the bank $ 49,505.02 of public money belonging to the county, of said sum $ 33,255.06 was money in excess of 50 per cent. of the capital stock of the bank and was money protected by the bond to the extent of the amount of the bond.

Schmidt as county treasurer, filed a claim with the receiver for $ 49, 505.02 and asked that it be allowed as a preferred claim and paid out of the guaranty fund. On March 19, 1923, the court allowed the county treasurer $ 16,250 as a preferred claim, the same being 50 per cent. of the paid-up capital and surplus of the bank. It was evidently the theory of the court that the amount of deposits which the county treasurer could legally make, and which would be protected by the guaranty fund, was limited to 50 per cent. of the capital stock and surplus of the bank. As to the balance the court withheld its judgment, but later refused to allow the same as a preferred claim.

On February 5, 1924, the county treasurer made demand upon the surety for the amount for which it was liable on the bond, to wit, $ 10,764.02, which sum the surety then paid to the county treasurer. Thereupon the county treasurer delivered to the surety a written assignment, whereby he sold, assigned and transferred to the surety the sum of $ 10,764.02 on deposit in the bank and thereby subrogated the claimant to all its rights and remedies against the bank with respect to said sum. The claim of the surety company is based on the assignment, as well as upon the equitable doctrine of subrogation.

It is first urged by the receiver...