Travelers Indem. Co. v. Mercer, 70--915

• Decision Date: 21 July 1971
• Docket Number: No. 70--915,70--915
• Citation: 250 So.2d 283
• Parties: TRAVELERS INDEMNITY COMPANY, Appellant, v. R. B. MERCER et al., Appellees.
• Court: Florida District Court of Appeals

Page 283

250 So.2d 283

TRAVELERS INDEMNITY COMPANY, Appellant, v. R. B. MERCER et al., Appellees.

No. 70--915.

District Court of Appeal of Florida, Fourth District.

July 21, 1971.

James W. Dawson, of Howell, Kirby, Montgomery, D'Auito, Dean & Hallowes, Rockledge, for appellant.

Paul H. Lee, Jr., of Gurney, Gurney & Handley, Orlando, for appellees.

MAGER, Judge.

This is an appeal from a final judgment entered pursuant to a mandate of this court. In Federal Insurance Company v. Mercer, Fla.App.1970, 237 So.2d 243, this court reversed a final judgment previously entered in favor of R. B. Mercer, plaintiff-appellee in that cause, and concluded as follows:

'For the reasons stated, the final judgment appealed from is reversed with directions to enter final judgment for the intervenor, Federal Insurance Company, for possession of the replevined automobile and against plaintiff R. B. Mercer And his surety for the value of the replevined automobile and costs as provided by F.S. Section 78.21, F.S.A.' (Emphasis supplied)

The surety, Travelers Indemnity Company, appellant herein, takes the position that the final judgment which was predicated upon the above quoted language is erroneous by reason of the fact that such judgment binds the surety to a person other than the individual named in the surety bond. The pertinent facts are as follows. Mercer, plaintiff below, filed a replevin suit against Sheriff Leigh S. Wilson, defendant below, seeking to recover an automobile which had been taken from Mercer's possession because it was believed to be stolen. Mercer, in accordance with the provision of Section 78.07, filed a replevin bond executed by Travelers. The bond provides in part that Mercer as principal and Travelers as surety 'are held and firmly bound unto Leigh Wilson as sheriff * * *.' The sheriff filed an answer in which he alleged, among other things, that the vehicle in his custody was stolen from Theodore Abdenour. Subsequently the Federal Insurance Company, appellee herein, filed a petition to intervene asserting the ownership of the automobile by Abdenour and additionally asserting that as Abdenour's insurer it had paid him for the loss of the vehicle and thereby became subrogated to any claim which Abdenour had for damages resulting from the aforementioned loss. Mercer stipulated that appellee and Abdenour could intervene as defendants in the replevin suit and that the intervening defendants 'shall not be bound by the case as they find it but that they be considered as original defendants in this case and acquire all the rights of an original defendant'. The trial court entered an order granting the petition to intervene, concluding:

'* * * (O)rdered that the petitioners herein be allowed to intervene As defendants in the above styled cause and grant them ten days to file an answer herein; Pursuant to stipulation.' ¹ (Emphasis added.)

It is to be noted that no active part was taken by the sheriff in the proceedings below and, also, that Travelers, the appellant herein, was Not a party to the proceedings below. Subsequently the trial court found for Mercer, the defendant-intervenors appealed and the cause was reversed. Federal Insurance Company v. Mercer, supra.

Travelers takes the position that when it executed the surety bond in favor of Mercer, its principal, it bound itself only to Sheriff Wilson and not to the defendant-intervenors below who ultimately prevailed. Travelers asserts that to require it to be bound unto the defendant-intervenor constitutes a material alteration in the contract of suretyship prejudicing its position and thereby releases the surety from any obligation. See 30 Fla.Jur., Suretyship and Guaranty, § 14. We reject this contention and in so doing make the following observations.

In Evans v. Kloeppel, 1916, 72 Fla. 267, 73 So. 180, the Supreme Court of Florida discussed the relationship of a surety under the required replevin bond. The Supreme Court initially observed that a surety, by signing the undertaking, 'becomes a Quasi party to the suit and is held to have notice of all the proceedings thereafter in the suit that may affect his liability on the undertaking'. In discussing the practice prior to the adoption of statutes relating to replevin, the court observed, at pp. 186--187:

'* * * In this state the forthcoming bond is a convenient substitute for the old practice. It is bond given in the course of legal proceedings, the sureties having full knowledge of the consequences to them of a judgment against their principal. By becoming sureties upon the bond they submit themselves to the acts of the principal and to the judgment as itself a legal consequence falling within the suretyship. They are represented in the proceedings by their principal, are bound by his acts, and are quasi parties to the suit. They thus have their day in court, being by their act conclusively bound by the judgment against their principal to the exclusion of all defenses that were or might have been set up by him. (Citations omitted) * * * The statutes do not do violence to the due process clause of the fourteenth amendment, because the surety by signing the undertaking, the condition and consequences of which are fixed by statute, enters the court for the purpose of contesting or aiding his principal in contesting a question in an action pending in the court and Is thus deemed to have submitted himself to the jurisdiction of the court for all purposes of the action.' (Citations omitted; emphasis added.)

As a general proposition, contracts of suretyship are regarded as analogous to contracts of insurance in that the various rules of construction governing insurance policies are applicable; as to sureties who receive compensation their contracts are construed most strictly against them and in favor of the obligee. 30 Fla.Jur., Suretyship and Guaranty, § 11. When Mercer, principal, stipulated to the intervention of the appellee 'as a defendant', Travelers, as surety, was put on notice of the claim of the appellee and thereby became bound by the subsequent proceedings and...