U.S. Fidelity & Guaranty Co. v. Union Trust & Sav. Co.

• Decision Date: 17 January 1905
• Citation: 142 Ala. 532,38 So. 177
• Parties: UNITED STATES FIDELITY & GUARANTY CO. v. UNION TRUST & SAVINGS CO.
• Court: Alabama Supreme Court

38 So. 177

142 Ala. 532

UNITED STATES FIDELITY & GUARANTY CO. v. UNION TRUST & SAVINGS CO.

Supreme Court of Alabama

January 17, 1905

Appeal from City Court of Montgomery; A. D. Sayre, Judge.

Action by the Union Trust & Savings Company, as trustee, against the United States Fidelity & Guaranty Company. From a judgment for plaintiff, defendant appeals. Reversed.

This suit was brought in said city court on March 22, 1902, by the Union Trust & Savings Company, as trustee for Edmund Tatum and Clark Tatum, against the United States Fidelity &amp Guaranty Company, as the surety upon the official bond of W H. Parks as register in chancery, to recover $1,700, damages for the conversion of certain specified sums of money alleged to have been received by said register in his official capacity, belonging to said Edmund and Clark Tatum, and by the register deposited to his credit as register in the bank of Josiah Morris & Co., whereby the money was lost to said beneficiaries. The complaint, after showing the appointment of W. H. Parks as register, averred, among other things, that on the 12th day of November, 1898, said W. H. Parks and the defendant, as his surety, executed a certain bond as the official bond of said Parks as such register in the sum of $10,000, payable to the state of Alabama, and approved by W L. Parks, as chancellor of the division; that said register acted under said bond; that during the time he was so acting under said bond there came into his hands as register the sum of $2,835 belonging to the said Edmund and Clark Tatum under a trust in their favor created by the last will and testament of Berry Tatum, Sr., deceased, which sum the register was required to retain in his hands subject to the orders of the court; and that said register, while acting under said bond "made a general deposit of a portion of said fund in his name as said register in and with the banking house of Josiah Morris & Co., as follows": July 10, 1899, $320; July 31 1899, $11.10; September 30, 1899, $40; January 4, 1900, $40 January 16, 1900, $220; June 26, 1900, $40; June 12, 1900, $40; July 12, 1900, $1,003.33; August 2, 1900, $318. The complaint then averred that "by reason of said general deposit of said several sums by said Wm. H. Parks, as said register, with said Josiah Morris & Co., the said sum of seventeen hundred dollars was lost to the said beneficiaries under said trust, to their damage as aforesaid." The due appointment of the plaintiff as trustee as aforesaid was alleged. The complaint made an exhibit of a copy of the bond sued on. The instrument purported to be the bond of the register as an "employé" in the service of the state of Alabama as the "employer" for the register's "honesty in the performance of his duties of the said position." It recited that the said "employer" had delivered to the surety company "a statement in writing relative to the duties, responsibilities, and checks to be used upon the employé in said position and other matters," and provided that in consideration of $30 "paid as premium for the period from November 12, 1898, to November 12, 1899, at 12 o'clock noon, and upon the faith of the said statement aforesaid by the employer, it is hereby agreed and declared that, subject to the provisions and conditions herein contained, which shall be conditions precedent to the right on the part of the employer to recover under this bond, the company shall, within three months next after notice accompanied by satisfactory proof of loss as hereinafter mentioned has been given to the company, make good and reimburse the employer all and any pecuniary loss sustained by the employer of money securities or other personal property in the possession of the employé or for the possession of which he is responsible by any act of fraud or dishonesty on the part of said employé in connection with the duties of the office or position hereinbefore referred to and occurring during the continuance of this bond or any renewal thereof, and discovered during the continuance or within six months thereafter or within six months from the death or dismissal or retirement of the employé from the service of the said employer." It was further provided that notice in writing to the surety company should be given of any act of omission or commission on the part of the "employé" covered by the bond immediately after knowledge of the same came to the "employer"; that any claim in respect to the bond should be in writing, addressed to the president of the company, immediately upon the discovery of any loss for which the company was responsible, and within six months after the expiration or cancellation of the bond; and that upon the making of such claim the bond should wholly cease as regards any liability on the part of the company, and should be surrendered to the company on the payment of such claim. It was further stipulated that the company might cancel the bond at any time "by giving one month's notice to the employer and refunding the premium paid, less a pro rata part thereof for the time said bond shall have been in force, remaining liable for all or any default covered by this bond which may have been committed by the said employé up to the date of such determination,...