State v. Reed

• Citation: 95 S.W. 809
• Parties: STATE, to Use of FENTRESS COUNTY, v. REED et al.
• Decision Date: 01 August 1906
• Court: Tennessee Supreme Court

Page 809

95 S.W. 809

STATE, to Use of FENTRESS COUNTY, v. REED et al.

Supreme Court of Tennessee.

August 1, 1906.

Appeal from Chancery Court, Fentress County; D. L. Lansden, Chancellor.

Bill by the state, for the use of Fentriss county, against J. B. Reed and others. From a decree for plaintiff, defendants appeal. Affirmed.

Smith & Cooper and A. H. Roberts, for appellants. Conatser & Case, for appellee.

SHIELDS, J.

The bill in this case is brought by the state of Tennessee, for the use of Fentress county, against James B. Reed, county trustee of that county, and others, his sureties upon his official bonds, to recover $2,853.36, on account of county revenues collected, but not accounted for, as required by law, by said Reed.

The defendants, answering, admit the election of Reed as trustee; the execution of the bonds sued on, and the collection of the money which he has not paid over; but they deny that the county is entitled to a decree against them for it. Their defense is that the defendant Reed deposited the county revenues, as collected by him, to his credit as trustee in the Fentress County Savings Bank, a banking concern then doing business in Jamestown, the county seat of Fentress county, and of good reputation for solvency, in that community, in good faith believing, after careful and diligent inquiry and investigation, that the bank was solvent and the county's money safe in its hands, and that while it was so deposited, without fault or negligence upon his part, the bank failed, and a portion of the money, amounting to the sum sued for, became uncollectible and was lost. They insist that upon these facts the defendant Reed was not liable for the money thus lost, and that they should not be held to account for it.

The Court of Chancery Appeals, upon the hearing before it, found that the defendant Reed did deposit the county revenues collected by him as trustee to his credit as trustee in the Fentress County Savings Bank; that these funds were kept separate from his private or individual money; and that he received no compensation from the bank for keeping his account with it; that the bank and its officers, at the time he opened his account and deposited the money lost, sustained good reputation for solvency and integrity with the business men and citizens of Fentress County, but that the bank, while the defendant had deposited therein to his credit as trustee $3,491.17, failed and assigned, and in this way, after crediting the pro rata paid by the assets of the bank, $2,853.36 of the county's revenue was lost.

That court further finds that the defendant Reed lived in the country about eight miles from Jamestown; that he had no safe place there to keep and deposit the public money collected by him; and that he was advised by his bondsmen and by business men of the county to deposit it in the Fentress County Savings Bank, which was the only banking institution in the county, and that he did so, in good faith believing the bank solvent and responsible; that...