State v. Yates

• Decision Date: 30 November 1910
• Citation: 132 S.W. 672,231 Mo. 276
• Parties: STATE ex rel. BELL v. YATES et al.
• Court: Missouri Supreme Court

132 S.W. 672

231 Mo. 276

STATE ex rel. BELL v. YATES et al.

Supreme Court of Missouri. Division No. 1.

November 30, 1910.

1. LIMITATION OF ACTIONS (§ 33) — STATE HOSPITAL — LIABILITY ON TREASURER'S BOND—LIMITATION.

Rev. St. 1909, § 1890, providing that an action "against a sheriff, coroner or other officer" on a liability incurred in his official capacity shall be commenced within three years, is applicable to the liability of sureties on the bond of the treasurer of a state hospital; the doctrine ejusdem generis not applying to prevent such interpretation.

2. PRINCIPAL AND SURETY (§ 59)—NATURE OF LIABILITY—STRICT CONSTRUCTION.

The obligation of a surety on a contract of suretyship, which is unambiguous in its terms, is to be strictly construed, and is not to be extended by implication.

3. LIMITATION OF ACTIONS (§ 5)—CONSTRUCTION OF LIMITATION LAW.

Statutes of limitation are favored, and are to be liberally construed.

4. APPEAL AND ERROR (§ 1018)—REVIEW— FINDINGS OF REFEREE.

Findings of fact by a referee in a law case are in the nature of a special verdict, and an appellate court will not weigh the evidence on which they are based, if such evidence is of a substantial nature.

5. APPEAL AND ERROR (§ 1018)—REVIEW— FINDINGS OF REFEREE.

In an action on the bond of a treasurer of a state hospital, held, that a finding of a referee that the board of managers of the hospital were guilty of such negligence in failing to discover the defalcation of the treasurer as to preclude the state from claiming that the concealment by the treasurer of the defalcation prevented the running of the statute of limitations as to an action on the bond was supported by such substantial evidence that such finding would not be disturbed on appeal.

6. LIMITATION OF ACTIONS (§ 104)—"FRAUDULENT CONCEALMENT" OF CAUSE OF ACTION.

The "fraudulent concealment" avoiding the running of the statute of limitations must go beyond mere silence, and must be something actually done or said which is directly intended to prevent discovery.

7. LIMITATION OF ACTIONS (§ 192)—PLEADING—MATTERS AVOIDING BAR OF STATUTE.

A party relying on fraud and concealment preventing the bar of the statute of limitation must plead and prove such fraud and concealment.

8. APPEAL AND ERROR (§ 171)—ADHERING TO PLEADINGS AS CONSTRUED BELOW.

Where the parties tried the case below on the theory that the pleadings were broad enough to raise the issues of fraudulent concealments and due diligence as affecting the running of the statute of limitations, the appellate court will proceed on the same theory.

Appeal from Circuit Court, Callaway County; Alex. H. Waller, Judge.

Action by the State, on the relation of J. P. Bell, Treasurer of State Hospital No. 1, against Martin Yates and others. From a judgment for defendants, plaintiff appeals. Affirmed.

E. W. Major, Atty. Gen. (North T. Gentry, of counsel), for appellant. Harris & Hay and W. M. Williams, for respondents.

LAMM, P. J.

The state sues in the circuit court of Callaway at the relation and to the use of Bell, treasurer of State Hospital No. 1, on August 5, 1905, on the bond of an absconding ex-treasurer, Thomas, to recover $7,721.06 alleged to have been wrongfully converted by him to his own use of the moneys of the hospital in his hands. Defendants are Thomas' sureties on his official bond in the penal sum of $24,000, dated April 13, 1897, the condition of the bond running: "Whereas, the said William D Thomas was, on the 12th day of April, 1897, duly appointed to the office of treasurer of the State Lunatic Asylum No. 1, at Fulton (Missouri), and has been duly commissioned. Now, therefore, if the said William D. Thomas shall faithfully perform all the duties of said office, shall faithfully pay over and account for all moneys, property and effects that may come into his possession as such officer, then this obligation to be void, otherwise to remain in full force and effect." The breaches are that Thomas, at divers times from April 17, 1897, to March 17, 1899, collected moneys due said hospital from various sources, aggregating said sum, which he failed to report to its board of managers or the State Auditor, and failed to pay into the state treasury or otherwise lawfully account for. Judgment was asked for the penalty of the bond with award of execution for $7,721.06 damages. The sureties' answer was a general denial, plus a plea of the three years' statute of limitations. Section 1890, Rev. St. 1909.

Sent to a referee, E. W. Hinton, Esq., of the Bonne bar, the order of reference gave him power "to take evidence, try and decide the law and the fact, and make report thereof." At a certain time (having duly qualified and heard the case) he made report, accompanied by the evidence taken. Among his findings, one was that Thomas received and appropriated to his own use several thousand dollars of the funds of the hospital— his defalcation divided between 1897 and 1898. Further, that the board of managers did not exercise ordinary care "in examining the accounts and settlements of W. D. Thomas as treasurer of said asylum, and that by the exercise of ordinary care in the examination of such accounts, and in comparing the same with the books of the secretary and the treasurer's duplicate receipts on file with him, such board of managers could have discovered many of the discrepancies in the treasurer's accounts, and that he was not reporting and accounting for all funds received." In conclusions of law on that finding of fact the referee reported, inter alia, that: "The action is barred by the three-year statute of limitations." The Attorney General appeared ex officio, and joined in exceptions to the report, among them, the following:

"(6) The referee erred in finding that the plaintiff's cause of action is barred by the statute of limitations. * * *"

"(8) The referee erred in finding that the board of managers of State Lunatic Asylum No. 1, at Fulton could have discovered many of the discrepancies in the accounts of W. D. Thomas, treasurer as aforesaid, by the exercise of ordinary care.

"(9) The referee erred in finding that the failure of the board of managers of State Lunatic Asylum No. 1 at Fulton, to discover the discrepancies aforesaid, did not arrest the running of the statute of limitations."

The exceptions were overruled, the report was approved and confirmed, judgment for defendants following. On due steps, the cause comes here on the state's appeal. We put aside all exceptions to the referee's report, save the above, because our learned Attorney General and his learned co-counsel (as we read the state's brief) hang the case on appeal on a single thread, viz., the finding relating to the statute of limitations and on error below in the ruling thereon. This eliminates several exceptions, for example:

There was an admission made that on March 10, 1896, the board of hospital managers amended their by-laws so that the term of office of the treasurer became one year instead of two as theretofore. Thomas, first elected in April, 1897, was elected for another term of one year on May 10, 1898. There was no evidence showing a new bond given for the second term. On such record the referee found, as a conclusion of law, that the bond in suit did not cover defalcations during the second term. For defendants it is argued that such conclusion was sound. But, as we see it, the case breaks on a vital point before that one is reached in logical order. So contention was made that the general language of the petition did not properly allege breaches of the bond. The learned referee so found. The point is elaborately briefed by defendants' counsel, but, however inviting the field, its exploration will not be attempted in this case, but the question will be reserved to be determined in some case hinging on the proposition.

Attending to the main question anent the statute of limitations, we all agree it was well ruled below. Because:

(a) Section 1890, Rev. St. 1909, ordains that an action "against a sheriff, coroner or other officer, upon a liability incurred by the doing of an act in his official capacity and in virtue of his office, or by the omission of an official duty, including the nonpayment of money collected upon an execution or otherwise," shall be commenced within three years. This section announces the rule of limitations applicable to Thomas' sureties. Its exposition in State ex rel. v. Harter, 188 Mo., loc. cit. 528, 87 S. W. 941, et seq., removes the question from the realm of debate by holding that the doctrine of ejusdem generis does not apply to "other officer," and that such term was broad enough to include all persons measuring up to the definition of a statutory officer—in that case the treasurer of a school board. Confessedly, Thomas was such person.

(b) Assuming a given contract of suretyship is unambiguous, then the obligation of the surety is strictissimi juris. His liability may not be stretched by implication.

Not only so, but statutes of limitations are favored in modern law and are liberally construed to further their beneficent purpose. Wetmore v. Crouch, 188 Mo., loc. cit. 652, 87 S. W. 954. et seq.; Shelby County v. Bragg, 135 Mo., loc. cit. 300, 36 S. W. 600. Says Mr. Justice Swayne in Wood v. Carpenter, 101 U. S., loc. cit. 139, 25 L. Ed. 807, speaking for the whole court: "Statutes of limitation are vital to the welfare of society and are favored in the law. They are found and approved in all systems of enlightened jurisprudence. They promote repose by giving security and stability to human affairs. An important public policy lies at their foundation. They stimulate to activity and punish negligence. While time is constantly destroying the evidence of rights, they supply its place by a presumption which renders proof unnecessary. Mere delay, extending to the limit prescribed, is itself a conclusive bar. The bane and antidote go together."

(c) Keeping in mind paragraphs (a)...