Witzenburg v. State

• Decision Date: 25 July 1941
• Docket Number: 31081
• Citation: 299 N.W. 533,140 Neb. 171
• Parties: MARCE WITZENBURG, APPELLANT, v. STATE OF NEBRASKA, APPELLEE
• Court: Nebraska Supreme Court

299 N.W. 533

140 Neb. 171

MARCE WITZENBURG, APPELLANT, v. STATE OF NEBRASKA, APPELLEE

No. 31081

Supreme Court of Nebraska

July 25, 1941

APPEAL from the district court for Lancaster county: JOHN L. POLK JUDGE. Affirmed.

AFFIRMED.

Syllabus by the Court.

1. By the provisions of section 44-204, Comp.St.1929, the state determines the source of the funds which may be used in the payment of compensation for services rendered and expenses incurred in the administration of the affairs of an insurance company by the department of trade and commerce (now insurance).

2. The state does not underwrite those items of compensation and expenses and does not authorize its officials to contract to save employees harmless in the handling of those funds.

3. Every person must ascertain, at his peril, the extent of the power of a public officer in the performance of his ministerial duties.

4. The authority of the officer is a matter of public law, of which every person interested is bound to take notice.

5. In performing ministerial duties, the acts of a public officer which are beyond the powers authorized by law are void.

6. The contract alleged in the petition herein is void and not binding upon the state.

7. The general rule is that, while a court will take judicial notice of its own records, it will not in one case take judicial notice of the record in another case.

8. However, where cases are interwoven and interdependent and the controversy involved has already been considered and determined by the court in former proceedings involving one of the parties now before it, the court has the right to examine its own records and take judicial notice of its own proceedings and judgments in the former action.

9. Matters so judicially noticed are properly considered when determining the questions presented by a demurrer.

Appeal from District Court, Lancaster County; Polk, Judge.

Action by Marce Witzenburg against the State of Nebraska, to require defendant to reimburse plaintiff for money which he allegedly paid in satisfaction of judgment for unlawfully diverting funds of hail insurance company while administering company as special agent of state department of insurance, and to pay plaintiff's salary while serving as special agent. From a judgment dismissing the case, following sustaining of defendant's demurrer to petition, the plaintiff appeals.

Affirmed.

Albert S. Johnston, for appellant.

Walter R. Johnson, Attorney General, and Clarence S. Beck, contra.

Heard before SIMMONS, C. J., ROSE, EBERLY, CARTER, MESSMORE and YEAGER, JJ.

OPINION

SIMMONS, C. J.

Plaintiff alleges that in July, 1932, he was employed by oral contract at $ 250 a month to render services to the defendant as an employee of the department of trade and commerce (later department of insurance) in connection with the affairs of the Lincoln Hail Insurance Company then in the hands of the department; that the statutes authorized the department to give its employees such powers and duties as it considered proper; and that the defendant agreed to hold harmless any person so engaged from liability for acts done pursuant to such orders and in reliance upon said orders and in the belief that such orders were authorized and lawful; that prior to July, 1934, the defendant incurred obligations of $ 20,543.61 in the administration of the trust and placed funds of said trust in the hands of plaintiff and one F. A. Wood and directed that they be disbursed in the payment of said obligations; that plaintiff and Wood were informed that said funds could be so used lawfully and that the court had so authorized their use; that plaintiff and Wood so disbursed the funds, exercising no discretion in so doing, under orders of the defendant, believing that their acts were authorized and legal and relying on the agreement of the defendant to hold them harmless; that the amounts so paid were authorized and approved by the court in the action then pending involving said insurance company; that in July, 1934 (after the disbursement of said funds) policyholders intervened in the district court action claiming that the moneys used in the payment of said expenses were funds which could not be used for that purpose and that plaintiff was liable therefor; that the defendant and its attorney general were notified and agreed to defend said action and hold the plaintiff harmless; that the defendant abandoned the defense of said action and plaintiff employed his own counsel; that in said action it was adjudged that $ 12,633.56 was not lawfully disbursed and plaintiff and Wood were required to repay the same with interest, which they did, and that the judgment, costs and attorneys' fees so paid amounted to $ 15,145.72; that the plaintiff acted throughout in good faith and relying upon defendant's statement that it had the authority to so use the funds; that at all times during plaintiff's employment the defendant had ample assets of the trust to have paid the expenses of its administration, and to hold the plaintiff harmless, but it failed to do so; and that by reason thereof defendant is obligated to indemnify plaintiff for the amount spent in making restoration. The above constitutes a summary of the allegations of plaintiff's first cause of action.

For a second cause of action plaintiff alleges that he was paid his salary to December 31, 1933; that it was agreed that his salary subsequent thereto should be paid when the remaining assets of the trust were liquidated; that plaintiff continued said employment until January 28, 1935; that his unpaid salary amounts to $ 3,233.33; and that defendant disposed of the assets of the trust and did not pay him.

Plaintiff further alleged, as to both causes of action, that he presented a claim for the amounts due him to the department for approval, but that that department failed to approve the same; that he then presented the claim to the auditor of public accounts, who informed plaintiff that there were no funds appropriated or available for its payment and referred the same to the claims and deficiencies committee of the legislature; that that committee did not approve the same; that that committee was of the opinion that it presented a question of contract and that the liability of the defendant could be determined by the courts without further legislative action.

Plaintiff prayed judgment for the sum of $ 15,145.72 on his first cause of action and the sum of $ 3,233.33 on his second cause of action.

To the petition the defendant demurred generally for the reason that the facts stated in the petition "are insufficient to constitute a cause of action against this defendant."

The trial court sustained the demurrer, holding the petition deficient in the following particulars:

(1) The defendant was without power or authority, express or implied, to enter into the contract alleged; (2) the liability, if any, on the part of the state for alleged services or expenses rendered in the liquidation of the insurance company is a charge against the assets of the company and not of the state; (3) the action of the district court to which plaintiff refers in his petition was appealed to the supreme court of Nebraska and a decision rendered therein which is res adjudicate of any alleged cause of plaintiff.

Plaintiff elected to stand on his petition; his case was dismissed and he appeals.

A detailed summary of the facts surrounding this transaction may be found in State v. Lincoln Hail Ins. Co., 133 Neb. 496, 276 N.W. 169, wherein this court affirmed a judgment in favor of the receiver of the insurance company against plaintiff and Wood in the sum of $ 12,633.56, for moneys unlawfully diverted and misappropriated and denied them a judgment for compensation.

The plaintiff in this action seeks to require the defendant (state) to reimburse him for the money which he alleges he paid in satisfaction of that judgment and to require the defendant to pay him the salary which he was denied in that action.

The theory is that the acts done by the plaintiff which resulted in the judgment against him were in fact the acts of the defendant; that the defendant itself, acting through its officers, took the trust...