Walker v. State ex rel. Stinson
| Decision Date | 09 June 1911 |
| Docket Number | 21,495 |
| Citation | 95 N.E. 353,176 Ind. 40 |
| Parties | Walker et al. v. The State of Indiana, ex rel. Stinson, Auditor of Vanderburgh County, et al |
| Court | Indiana Supreme Court |
From Gibson Circuit Court; Frank H. Hatfield, Special Judge.
Action by The State of Indiana, on the relation of Harry Stinson, as Auditor of Vanderburgh county, against John P. Walker and others. From a judgment for plaintiff, defendants appeal.
Reversed.
Charles Martindale and George A. Cunningham, for appellants.
Miller Shirley & Miller, Samuel Dowden, Oscar R. Luhring Charles W. Wittenbraker, Daniel H. Ortmeyer and Robinson & Stilwell, for appellee.
Relator brought this action upon two successive bonds, given by John P. Walker as treasurer of Vanderburgh county, to secure the faithful performance of his duties as such treasurer. The first bond, covering the term from January 1, 1904, to December 31, 1905, was executed by Walker, as principal, and appellants, other than Constanza Lauenstein, and the since deceased husband of the latter who took his property by will as sureties. The second-term bond, covering the term from January 1, 1906, to December 31, 1907, was executed by Walker, as principal, and appellee Federal Union Surety Company, as surety.
Before the close of his second term, Walker was found to be a defaulter, and at the request of the Board of Commissioners of the County of Vanderburgh resigned as such treasurer on January 26, 1907.
An examination of his books as treasurer disclosed that at the close of his first term he had failed to turn over to himself, as his own successor, a part of the public moneys that had come into his hands as such treasurer during that term, and that at the time he resigned and his successor was appointed he had failed to account to his successor for a part of the public moneys that had come into his hands as such treasurer during his second term.
This action was brought by the State, on the relation of the county auditor, against Walker and the sureties on the two bonds, to recover the amount due from Walker as such treasurer, and for which he had failed to account.
The complaint was in two paragraphs, appellants' demurrers to which were overruled.
Appellee Federal Union Surety Company answered the complaint by general denial and plea of payment, and also filed a cross-complaint setting up its suretyship. Walker answered the general denial, was defaulted on the trial, and formally declined to join in the appeal, and in using the term appellants in this opinion it is meant to indicate those charged with a liability on his first-term bond other than himself. Appellants answered the general denial and pleas of payment and partial payment, and also filed a cross-complaint setting up their suretyship. On these pleadings the issues were closed by replies of general denial. The trial court made special findings of facts and stated conclusions of law thereon.
The court found, in substance, that the first-term bond, for the period stated and with the sureties before mentioned, had been executed; that during that term Walker received, by virtue of his office, and converted to his own use, $ 54,152.49; that said sum had not been repaid, nor any part thereof; that the second-term bond for the period stated and with the surety before mentioned, had been executed; that Walker resigned as such treasurer on January 26, 1907, and a successor was appointed; that during his second term Walker received, by virtue of his office, and converted to his own use $ 11,951.84; that the board of commissioners gave Walker credit for $ 2,310.96, as a credit on the second-term shortage, leaving $ 9,640.88, as the amount that Walker received by virtue of his office and converted to his own use during the second term; that the Federal Union Surety Company on February 22, 1907, tendered to the county, $ 17,749.15, in full settlement of any liability on the second-term bond; that this amount was by certified check, and was accepted by the treasurer of the county on February 28, 1907, in full settlement of all liability on the second-term bond, provided it should be found that the shortage for that term did not exceed that amount; that before said payment by the Federal Union Surety Company was made, Walker had transferred to the vice-president of the surety company certain property, under a written agreement that the company should sell the property and apply the proceeds to the second-term shortage, the balance, if any, to be turned back to Walker; that all of this property was purchased by Walker with money collected as treasurer during his first term, except $ 1,000, which he paid for certain trust company stock with money collected as treasurer during his second term, and $ 1,000, which he paid on another piece of property with money collected as treasurer during his second term; that a part of this property transferred by Walker to the surety company was, subsequent to the payment by the surety company of the sum of $ 17,749.15 into the treasury as before stated, sold, and the surety, in reimbursement received as the proceeds thereof $ 17,309.99, the unsold part of the property being returned to Walker.
As conclusions of law the court stated that relator is entitled to a judgment against appellants in the sum of $ 54,152.49, which with interest and penalty thereon amounted to $ 66,912.66, together with costs, and that the relator was not entitled to any judgment against the Federal Union Surety Company.
It may be said that nothing in this appeal raises any question as to the right of relator to recover on the two bonds the sum of the shortages found to exist in the two terms. The questions all turn on the sums to be recovered from the sureties on each bond.
Under the assignment questioning the sufficiency of the complaint, counsel for appellants are satisfied merely to assert in their brief that "the complaint did not allege that the funds alleged to have been received and collected were received and collected by virtue of his office," and that "the original complaint does not aver that in the first term there was any breach of the bond." No elaboration of these points is made by argument, and no authority is cited. It is sufficient answer to these vague objections to say that as the amended second paragraph of complaint is open to neither objection made, and as it clearly and conclusively appears that the special findings are based on this paragraph, the overruling of the demurrer to the original or first paragraph, even if erroneous, was harmless. Robinson v. Dickey (1896), 143 Ind. 205, 52 Am. St. 417, 42 N.E. 679; Marvin v. Sager (1896), 145 Ind. 261, 44 N.E. 310; Conner v. Andrews Land, etc., Co. (1904), 162 Ind. 338, 70 N.E. 376; Kelley v. Bell (1909), 172 Ind. 590, 88 N.E. 58; United States Cement Co. v. Cooper (1909), 172 Ind. 599, 88 N.E. 69; Pittsburgh, etc., R. Co. v. Sudhoff (1910), 173 Ind. 314, 90 N.E. 467.
Counsel for appellants assert that the trial court erred in fixing the amount of recovery against the sureties for the first term, in that it is larger in several particulars than the evidence warrants. The first of these claims grows out of the following facts: Walker on taking office on January 1, 1904 having theretofore given the bond in suit on which appellants are sureties, was entitled to receive as treasurer, and his predecessor was bound to pay over to him, the sum of $ 184,305.77 in money, which sum represented the balances in the various funds of which the treasurer was custodian. Settlement was made between them on that day, and Walker executed his receipt to his predecessors for the sum stated. At the time this transaction took place Walker was individually indebted to his predecessor in the sum of $ 10,489.90, for which the latter held his notes, and these notes were delivered to Walker, but were not assigned, and were accepted by him as so much cash, and went to make up the total sum for which his receipt was given. On the day of the settlement, and the transfer of the office, Walker's predecessor was ready and willing to pay to him the full amount of these notes in cash, together with the balance of the total sum of $ 184,305.77, with which he was chargeable, but Walker insisted on taking them as cash in the settlement. Upon these facts counsel state their contention to be that the misapplication of funds was made by the predecessor of Walker, and that the defalcation was his and not Walker's; that since Walker did not take into his possession money to the amount of the sum of his notes, his failure to pay this sum to his successor at the end of his first term is not a delinquency on his part for which appellants, as sureties on his first-term bond, are liable, and that to that extent the recovery adjudged against them is too large. This unqualified contention is not urged with much earnestness, but it is insisted that the complaint is drawn on the theory alone that Walker did collect and receive from his predecessor this sum, and failed to pay over a sum actually collected, while the proof shows that he did not collect and receive the sum in question, and that to permit a recovery to the extent of this sum would be to violate the rule that a plaintiff must recover, if at all, on the theory of his complaint. This latter contention is based on the assumption that the breach of the bond alleged in the complaint is as narrow as counsel have stated as before indicated. It is broader than that. It is alleged in the complaint, "that said John P. Walker as treasurer of said county of Vanderburgh, in the term beginning January 1, 1904, and ending January 1, 1906, received and collected, and was charged with and had in his possession, as such treasurer, the sum of $...
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