United States v. Ferguson

• Decision Date: 16 July 1975
• Docket Number: Crim. A. No. 5412.
• Citation: 409 F. Supp. 393
• Parties: UNITED STATES of America v. James FERGUSON, Principal, A-Bonding Service, Surety, and Bankers Fire & Casualty Insurance Company, Surety.
• Court: U.S. District Court — Southern District of Georgia

409 F. Supp. 393

UNITED STATES of America v. James FERGUSON, Principal, A-Bonding Service, Surety, and Bankers Fire & Casualty Insurance Company, Surety.

Crim. A. No. 5412.

United States District Court, S. D. Georgia, Augusta Division.

July 16, 1975.

Elizabeth C. Chalker, Asst. U. S. Atty., Augusta, Ga., for plaintiff.

James T. Wilson, Jr., Wilson & Trotter, Augusta, Ga., for defendants.

OPINION AND ORDER ON MOTION FOR JUDGMENT ON FORFEITED BAIL BOND

LAWRENCE, Chief Judge.

This is a motion by the United States for judgment against Bankers Fire & Casualty Insurance Company, as surety, for the unsatisfied portion of a forfeited bail bond filed in the criminal case of United States vs. James Ferguson (Augusta Division, No. 199). Bankers resists the motion and the rule to show cause.

A hearing was held before me at Augusta on May 15th. The record shows that on January 7, 1971, an appearance bond was executed by James Ferguson, a criminal defendant. As principal, he and the named surety (A-Bonding Co., John S. Wilson) acknowledged themselves to be bound to pay to the United States the sum of $5,000 in the event of breach of the condition thereof in failing to appear on a certain date before the United States Commissioner.

Upon breach of the condition, the bond was forfeited and the United States obtained a judgment against Ferguson and "A Bonding Service" in the amount of the penalty and costs. Execution issued against such parties on October 12, 1971. "A Bonding Service" (or A Bonding Co.) was the trade name of John S. Wilson who was a professional bondsman and is now deceased. Eventually the Government collected from Wilson a total of $2,495, leaving $2,505 owing on the judgment. On April 30, 1975, the United States moved for judgment for such balance against Bankers Fire & Casualty Insurance Company.

This case turns on the question of the liability of that Company to the United States under the appearance bond and under the power-of-attorney it gave to Wilson in connection with the bond with which we are here concerned.

On the printed form of the appearance bond is a space for signatures and opposite "Name of Surety" was typed "A Bonding Company" immediately below which appears the signature of John S. Wilson. Stapled to the bond is the power-of-attorney, dated January 4, 1971, executed by Bankers Fire & Casualty. Under its terms, Wilson was appointed as "its true and lawful Attorney-In-Fact for it and in its name, place and stead, to execute, seal and deliver for it . . as surety . . . a bail bond only . . .." The power-of-attorney was required to be filed with the bond and retained as part of the court records. The attorney-in-fact was authorized to insert in the power-of-attorney the name of the person on whose behalf the bond was given. Blanks thereon were filled in showing the amount of the bond, the appearance date, the name of the defendant, the court and the offense charged.

Bankers Fire & Casualty had previously delivered a general power-of-attorney to Mr. Wilson which was renewable each year. The instrument authorized him to execute as its agent and attorney-in-fact bail bonds in a penalty not to exceed $50,000. It stated that all such bonds must be accompanied by "an individual, numbered power of attorney". The execution of bonds was to be binding on the Company as if they had been executed or acknowledged by it through its officers.

An affidavit by Curtis M. Ford, part-time Magistrate and formerly United States Commissioner at Augusta, is in the record. His signature appears on the appearance bond approved by him. Mr. Ford states that, pursuant to the authority granted to John S. Wilson under powers-of-attorney executed by corporate sureties, he (Wilson) had signed such bonds on at least four separate occasions. Deputy Clerk P. A. Brodie, Jr. states in an affidavit that it was part of his duties to approve and accept appearance bonds for criminal defendants and that it was his practice to accept only cash bonds, unencumbered realty bonds, or bonds guaranteed by a corporate surety. The guaranty usually took the form of a power-of-attorney appointing the local bondsman to act as agent for the corporate surety in signing bonds on behalf of the latter.

As earlier stated, Mr. Wilson personally signed the appearance bond in the name of A Bonding Co. rather than in that of Bankers or as attorney-in-fact for Bankers. Independent examination by this Court of the Clerk's records shows that in May and June, 1971, Mr. Wilson signed at least four appearance bonds to each of which was attached a power-of-attorney from Bankers. They were executed by him in the same manner as in the instant case. On the other hand, in 1969-1970 John S. Wilson, Jr. signed, under power-of-attorney from Resolute Insurance Company, sixteen appearance bonds in the following manner: "`A BONDING SERVICE' by Resolute Insurance Co. of Hartford, Conn. By John S. Wilson, Jr. Authorized Agent".¹ This execution is itself ambiguous and is not consistent with the power-of-attorney given by that insurer.

At the hearing in this Court on May 15th a copy of a remittance report by A Bonding Service, dated January 11, 1971, was put in evidence. It had been mailed by John S. Wilson to Bankers. Such schedule shows that he collected a premium of $500 in connection with Ferguson's bond and that out of it Bankers received $100 as commission and $50 for its trust account. A check for those amounts accompanied the report. A copy of the bond and power was also furnished Bankers.

While the guarantee by a corporate surety of John S. Wilson's personal obligation as bondsman under Ferguson's appearance bond may have been intended by the parties, the form of accomplishing any such purpose fell quite short of properly effectuating it. The only surety named in the bond is "A Bonding Co." whose proprietor is Mr. Wilson. His signature appears immediately beneath the typed business name. The bond is devoid of any reference whatever to Bankers.

The difficulty here is that in executing the appearance bond Mr. Wilson did not follow the letter of the power-of-attorney under which he acted for Bankers Fire & Casualty. He was authorized as its attorney-in-fact to execute the appearance bond of James Ferguson "in its name, place and stead" and "on its behalf". (Italics supplied). The name of Bankers Fire & Casualty does not appear in the bond executed by Wilson under the trade-name of his professional bondsman's business — A Bonding Co.

"It is the general rule that a power of attorney must be strictly construed and strictly pursued . . . the act done must be legally identical with that authorized to be done". 3 Am. Jur.2d Agency § 29. The rule in Georgia is that the undertaking of a surety is stricti juris. W. T. Rawleigh Company v. Overstreet, 71 Ga.App. 873, 32 S.E.2d 574; Barry Finance Company v. Lanier, 79 Ga.App. 344, 347, 53 S.E.2d 694. Criminal bonds are strictly construed in Georgia. Barnes v. United States, 223 F.2d 891 (5th Cir.). On the other hand, no particular or formal phrase is required to create the contract of surety and courts may disregard formal expressions to ascertain the real intent of parties. W. T. Rawleigh Company v. Overstreet, supra. The form is immaterial if the fact of suretyship exists. Ga.Code Ann. § 103-104; 72 C.J.S. Principal and Surety § 33.

In United States v. Jackson, 465 F.2d 964 (10th Cir.) the defendant's father gave his son a check for the amount of the deposit required by the appearance bond. The father's name and address were typed on the bond as surety. However, he did not sign same and the Court held that, under these circumstances, he was not liable as surety. The situation here is quite different. The name of Bankers Fire & Casualty was not typed in upon the bond. However, that instrument was not the entire contract. An integral part of the whole was the attached power-of-attorney. "The act and deed of the agent in executing the bond must be construed in connection with the power of attorney". Sasnett v. Owen, 69 Ga.App. 741, 752, 26 S.E.2d 640, 647.

Wilson failed to execute the bond in the name of Bankers as was contemplated by the power. However, a strong element of ratification exists. As attorney-in-fact, he sent Bankers a copy of the Ferguson bond and listed the transaction in a report of "Powers executed by me". He also mailed a "check for your share of premium". Mr. Wilson's report to Bankers showed:

                           Power                                             Company       Trust
                Date    Number       Name    Amount     Premium    Comm.       Account
                1/7/71     25254         James      $5,000        $500        $100           $50
                                         Ferguson
                

The amount so remitted was accepted by Bankers.

Under Georgia law, ratification by a principal relates back to the act ratified and takes effect as if originally authorized. The principal cannot repudiate in part but "shall adopt either the whole or none." Ga.Code Ann. §§ 4-303, 302. By retaining money paid after knowledge that its source was the principal's credit, through an unauthorized assumption of authority by an agent, the principal ratifies the act irrespective of any intent to do so. American Exchange National Bank v. Georgia Construction and Investment Co. et al., 87 Ga. 651, 657, 13 S.E. 505. See also Armour Fertilizer Works v. Maddox, 168 Ga. 429, 148 S.E. 152.

If an agent fails to disclose his principal, a person dealing with the former may, when the fact is discovered, go against the principal under the contract. Ga.Code Ann. § 4-305. An agent acting within the scope of his authority may bind his principal in his individual capacity only, when it appears from the instrument that the principal and not the agent is intended to be bound. Cochran v. Grand Theater Company, 29 Ga.App. 481, 115 S.E. 926. I am under the impression that until shortly before the hearing before me, the Government was unaware that that Company...