Yeargain v. Bd. of Com'Rs of Del. Cnty.

• Decision Date: 27 March 1923
• Docket Number: Case Number: 10862
• Citation: 215 P. 619,1923 OK 194,90 Okla. 38
• Parties: YEARGAIN et al. v. BOARD OF COM'RS OF DELAWARE COUNTY.
• Court: Oklahoma Supreme Court

1923 OK 194

215 P. 619

90 Okla. 38

YEARGAIN et al. v. BOARD OF COM'RS OF DELAWARE COUNTY.

Case Number: 10862

Supreme Court of Oklahoma

Decided: March 27, 1923

Syllabus

¶0 1. Depositaries--County Funds--Validity of Bond.

Pursuant to section 1540, Rev. Laws 1910, where the county commissioners designate a certain bank as depositary of the funds of the county, and the bank executes a bond with certain individuals as surety, and receives deposit from the county treasurer by virtue of said bond, and thereafter breaches the bond, held, that, although the bond was not a surety company bond, but was signed by individuals as sureties, and for that reason falls short of the statutory requirement, the same is valid as a common-law bond.

2. Same--Surplusage in Bond.

Where a depositary bond, executed pursuant to the provisions of section 1540, Rev. Laws 1910, although signed by individuals, instead of a surety company, contains the exact conditions imposed by the statute, and in addition other conditions which are not provided by the statute, tending to limit or evade liability, the bond will be upheld as to the conditions imposed by statute, and the other conditions will be treated as surplusage.

3. Contracts--Limitations--Validity.

Section 977, Rev. Laws 1910, provides: Every stipulation or condition in a contract, by which any party thereto is restricted from enforcing his rights under the contract by the usual legal proceedings in the ordinary tribunals, or which limits the time within which he may thus enforce his rights, is void.

4. Depositaries -- County Funds -- Liability on Bond.

A designation of a bank as a county depositary is effectual so long as the county shall continue to deposit its funds in the bank, and the bond given in pursuance of such designation is deemed to be a continuing obligation, upon which the sureties will continue to be liable for default, unless they have taken the necessary steps to terminate their liability on such bond.

Error from District Court, Delaware County; A. C. Brewster, Judge.

Action by the Board of Commissioners of Delaware County against J. D. Yeargain and others on depositary bond. Judgment for plaintiff, and defendants bring error. Affirmed.

J. G. Austin, for plaintiffs in error.

G. W. Goad, W. W. Miller, and Ad. V Coppedge, for defendant in error.

McNEILL, J.

¶1 This action was instituted in the district court of Delaware county by the board of county commissioners of said county against the plaintiffs in error to recover the sum of $ 5,000 on a depositary bond executed by the plaintiffs in error as sureties to protect and secure the deposits made by the county treasurer in the First State Bank of Jay, Okla. After the institution of the suit a portion of the amount lost in the hank by reason of its insolvency was recovered on another bond, and it was conceded that the plaintiffs in error were entitled to have the amount deducted from their liability; it is also conceded the amount lost by reason of the insolvency of the bank was $ 1,627.25. Judgment was rendered against the bondsmen for this amount. From this judgment the sureties, being plaintiffs in error, have appealed.

¶2 The bond bears date of November 29, 1913, and indorsed on the bond was "filed January 5, 1914," with a further indorsement "examined and found in proper form," signed "E. B. Hunt," whom the evidence disclosed was the county attorney, and "Clark Thompson," who at the time was county clerk. It was indorsed "approved February 3, 1914, by E. B. Wolton," who was chairman of the board of county commissioners. The bond was also indorsed "approved by W. C. Hall, county judge."

¶3 Section 1540, Rev. Laws 1910, provides that the county depositary bond shall be executed by a surety company. This court in the case of Ewing v. Board of Commissioners of Ellis County, 53 Okla. 250, 156 P. 229, held, in substance: That although the bond was not a surety company bond, but where it was executed by the bank with certain individuals as sureties, and approved, and the bank received deposits of the county funds from the county treasurer, and the bond was breached, the bond signed by individuals as sureties falls short of the statutory requirement, but the same is valid as a common-law bond.

¶4 For reversal, it is contended the court erred in overruling the demurrer to the petition for the reason the bond contained certain provisions in addition to the statutory requirements, to wit: That upon default notice should be given to the sureties within 30 days after such default; and second, that no action or proceeding should be brought after the expiration of 30 days after default.

¶5 The rule is stated in 18 C. J. 586, as follows:

"Statutory provisions relating to depositaries should be read in connection with the bond, especially where there is express reference thereto. Additional conditions to those provided for by the statute which tend to limit the liability of the surety will be treated as surplusage."

¶6 This court in the case of Western Casualty & Guaranty Ins. Co. v. Board of Commissioners of Muskogee County, 60...