U.S. v. Craft, 84-8786

• Citation: 763 F.2d 402
• Decision Date: 12 June 1985
• Docket Number: No. 84-8786,84-8786
• Parties: UNITED STATES of America, Plaintiff-Appellee, v. James Harold CRAFT, Harold A. Craft and Valerie Craft, Defendants, American Druggist Ins. Co., Defendant-Appellant.
• Court: United States Courts of Appeals. United States Court of Appeals (11th Circuit)

Page 402

763 F.2d 402

UNITED STATES of America, Plaintiff-Appellee, v. James Harold CRAFT, Harold A. Craft and Valerie Craft, Defendants, American Druggist Ins. Co., Defendant-Appellant.

No. 84-8786.

United States Court of Appeals, Eleventh Circuit.

June 12, 1985.

T. Michael Martin, Jonesboro, Ga., for defendant-appellant.

Albert L. Kemp, Jr., Asst. U.S. Atty., Atlanta, Ga., for plaintiff-appellee.

Appeal from the United States District Court for the Northern District of Georgia.

Before RONEY and HILL, Circuit Judges, and PITTMAN ^*, District Judge.

JAMES C. HILL, Circuit Judge:

Appellant American Druggist Insurance Company ("American Druggist"), a surety, appeals a district court order entering judgment on a forfeited bond. One issue is presented: where a defendant, free on bond prior to trial, is notified of, but fails to appear at, a hearing on the government's motion to modify the terms of the bond, is the defendant's surety relieved from forfeiture because the surety was not given separate notice of the hearing? We hold that the surety is not relieved from forfeiture, and affirm the district court's order.

FACTS

Appellant American Druggist acted as surety for part of the bond of James Harold Craft, so that Craft could be released pending trial on drug charges. The terms of the bond did not expressly require the government to notify the surety of any of the defendant's required appearances. The government filed a motion to reconsider the terms of the bond. A show cause hearing was scheduled and Craft was notified of the date, time and purpose of the hearing. American Druggist was not notified of the hearing. When Craft failed to appear at the hearing, the bond was forfeited. The terms of the bond were never modified. The government filed a motion for judgment on the forfeited bond. After

a hearing, of which appellant had been notified, the motion was granted. American Druggist appeals, claiming it was not subject to forfeiture, since it was never given notice of the show cause hearing.

DISCUSSION

A bond is "a contract between the surety and the government that if the government releases the principal from custody, the surety will undertake that the principal will appear personally at any specified time and place...." Stuyvesant Insurance Co. v. United States, 410 F.2d 524, 526 (8th Cir.), cert. denied, 396 U.S. 836, 90 S.Ct. 96, 24 L.Ed.2d 87 (1969). It is thus the surety's responsibility to ensure the principal's attendance. The principal must be notified of required appearances. However, at least where the bond is silent, the surety generally is not entitled to special, separate notice of the principal's required appearances. The principal's failure to appear leaves the surety in breach and subject to forfeiture, even though the surety was not so notified. United States v. Roher, 706 F.2d 725, 727 (5th Cir.1983); Stuyvesant, 410 F.2d at 526-27; United States v. Wray, 389 F.Supp. 1186, 1191 (W.D.Mo.1975). Thus, under the general rule, American Druggist would be subject to forfeiture. The issue here is whether this general rule does not apply simply because the subject matter of the hearing, which the principal fails to attend, was a motion to change the terms of the contract.

Apparently, no cases have decided this precise issue, though two cases have particular bearing on it. In United States v. Egan, 394 F.2d 262 (2d Cir.), cert. denied, 393 U.S. 838, 89 S.Ct. 116, 21 L.Ed.2d 109 (1968), a surety moved to set aside forfeiture of a bond on the ground that it had no notice that the trial judge had changed conditions of the bond so that the principals/defendants were required to report to the marshal once every ten days as opposed to every day. The court never reached the legal issue because it found the surety in fact knew of the change, even though it had not been notified. The court did suggest, however, in dicta that "[i]f the Government moves the court for a modification of the terms of the bond, it should give reasonable notice of the motion to the defendant and the surety." Id. at 267.

In United States v. Robinson, 453 F.Supp. 1 (S.D.N.Y.1977), a surety moved to set aside a forfeiture of a bond because it had not been given notice that the court had increased the amount of the bond. Relying on the Egan dicta, the Robinson court determined that the government had a duty to notify a surety when the terms of a bond are changed, stating, there is "a minimal duty on the Government to notify the surety where its risk has been significantly increased and the surety is not likely to be aware of this fact." Id. at 3. According to the Robinson court,

Egan recognizes that a surety can not be expected to be constantly in court to moniter [sic] the proceedings. It also implicitly recognizes that neither the defense attorney nor the defendant can be counted upon to notify the surety when in many...