182 Ind. 116 | Ind. | 1914
Appellee sued appellant, and Lewis L. Chapman, on a surety bond. The complaint alleges that at the general election of 1898, appellee was elected treasurer of Clark County, for a term of two years, commencing in January, 1899; that he appointed Chapman as his “General. Statutory Deputy”; that the bond in suit was executed by Chapman as principal, and appellant as surety, to indemnify appellee against loss by' embezzlement or theft, by Chapman, of county funds; that in the year 1899, Chapman embezzled $9,822 that came into his possession by virtue of his official position. The action was commenced in September, 1900, but the cause was pending in lower courts for more than twelve years before the rendition of the judgment from which this appeal is prosecuted.
The bond, filed as an exhibit to the complaint, recites that
“We, Lewis L. Chapman as principal, * * * and the American Surety Company of New York, * * * as surety (in consideration * * * of an agreed premium * * * ) bind ourselves, subject to the conditions hereinafter contained, to indemnify Marion E. Pangburn, treasurer of Clark County, Indiana, hereinafter called the ‘employer’ * '* * against such direct pecuniary loss not exceeding $10,000, as the employer shall have sustained of the employer’s money, funds, * * * stolen or embezzled by said employee * * * in the course of the performance of the duties of his employment as deputy treasurer of said employer.”
This is followed by numerous conditions, in number 13 of which appears the following:
“That this instrument shall not be construed as entered into or delivered by the surety until executed in due form by the employee as principal; that the liability of the surety hereunder is, and shall be construed as, one of suretyship only * * * . And said employee # # « binds himself * * * to save said surety harmless from, and on demand to pay it any and all claims, demands, loss * * * judgments and adjudications whatsoever which said surety shall at any time sustain.”
Appellant answered the complaint in several paragraphs, among which was a verified plea of non est factum. This cast on appellee the burden of proving that the bond in suit was signed and delivered by appellant, in its incomplete condition, with the purpose, on appellant’s part, of being bound thereby. There was a trial by jury, resulting in a verdict and judgment for appellee. Appellant’s motion for a new trial assigning, among other things, the insufficiency of the evidence, in law and fact, to
There was little conflict in the direct evidence relating to the delivery of the bond. Appellee was first elected as treasurer of Clark County in November, 1896, for the term of two years commencing the first Monday in January, 1897. "When his term commenced, appellee appointed Chapman as his general statutory deputy, on condition that he furnish a bond. Chapman applied to appellant at its home office in New York, for a bond for the term of one year, and appellant signed a bond in all respects like the one in suit, except as to dates, and forwarded the same to its branch office at Indianapolis, in charge of one Clark a resident assistant secretary who was authorized to deliver to obligees, bonds that had been signed at the home office. Later, on March 14, 1897, the bond was mailed to appellee, at Jeffersonville, Indiana, from appellant’s branch office at Indianapolis by appellant’s resident assistant secretary with a letter, reading in part, as follows:
' “Mr. Marion E. Pangburn, Treasurer, Jeffersonville, Ind.
Dear sir: We beg to enclose herewith suretyship bond No. 202,438, covering your deputy, Mr. Lewis L. Chapman, in the sum of $10,000, for the period of January 2, 1897, to January 2, 1898. Delay in the execution of your bond has been due to”, etc.
That bond was never signed by Chapman. Appellant received $50 as a premium. The bond was renewed for the year 1898, in consideration of a premium of $50. On January 2,1899, appellee reappointed Chapman as his statutory deputy, with the understanding that he should give bond as he had done before. Chapman made application to appellant for a new bond, on a printed form, and sent it to appellant’s home office, at the city of New York. Thereupon appellant forwarded to appellee a printed form of statement for him to fill out and sign. The same was filled out and
Of course appellant was under no obligation to return the premium received as a condition precedent to pleading a non est factum. Evidence in regard to the premium was admitted by the trial court for the purpose of enabling the jury to determine the intent of appellant’s officers in sending the bond, in its incomplete condition, to appellee. We are of the opinion that the evidence is sufficient to warrant the finding that appellant delivered the instrument in suit to appellee, with the intention of being thereby bound, and
Counsel for appellant cite many authorities in support of the proposition that a contract containing the express condition found here must be held invalid in the absence of its execution by the principal. Markland Mfg. Co. v. Kimmell (1882), 87 Ind. 560; Allen v. Marney (1879), 65 Ind. 398, 32 Am. Rep. 73; and Deering Harvester Co. v. Peugh (1897), 17 Ind. App. 400, 45 N. E. 808, cited by appellant, are to be distinguished from the case at bar by reason of the fact that here the instrument was delivered by the surety, instead of the principal, or some one acting in his behalf. Many eases from other jurisdictions are cited which do not involve the question of waiver by a surety for hire. However, it must be conceded that there is a lack of harmony in the cases of other jurisdictions. See monographic notes to following cases: School District v. Lapping (1907), 12 L. R. A. (N. S.) 1105; City of Deering v. Moore (1893), 41 Am. St. 534; Novak v. Pitlick (1903), 98 Am. St. 360; Estate of Ramsey v. People (1902), 90 Am. St. 188; People v. Carroll (1908), Ann. Cas. 1912 A 1014. The facts in General R. Signal Co. v. Title Guaranty, etc., Co. (1911), 203 N. Y. 407, 96 N. E. 734, were similar to the facts here. The bond, there, was signed by the surety company, and delivered to the obligee, a private corporation, to indemnify the latter against loss by larceny or embezzlement of its employe. The bond was not signed by the employe, and contained a provision that it should not be effective unless executed by the principal. The application of the employe for the bond, in that ease, contained a promise by him to indemnify the surety company against any loss occasioned by the breach of the bond, while in the employe’s application here there was no such promise. However, the difference is immaterial, as the law made Chapman liable to appellee for funds stolen or embezzled, and appellant would be subrogated to appellee’s rights whenever it pays in
Under the liberal provisions of our code of civil procedure the appellant might have made Chapman a party to the action and filed a counterclaim and obtained an adjudication of its rights against him to the same extent as if he had executed the bond, for the provisions of the latter created no liability of Chapman to it that did not already exist, by operation of law, from him to appellee. It thus appears that Chapman’s failure to execute the bond “was a mere technicality, which ought not to affect the rights of any of the parties concerned.” Trustees, etc. v. Scheick (1886), 119 Ill. 579, 59 Am. Rep. 830, 8 N. E. 189. See, also, United States Fidelity, etc., Co. v. Haggart (1908), 163 Fed. 801, 91 C. C. A. 289; City of Deering v. Moore, supra; Empire State Surety Co. v. Carroll County (1912), 194 Fed. 593, 114 C. C. A. 435; Woodman v. Calkins (1893), 13 Mont. 363, 40 Am. St. 449, 34 Pac. 187; State v. Bowman (1841), 10 Ohio 445; Rule v. Anderson (1911), 160 Mo. App. 347, 142 S. W. 358; People v. Carroll, supra. While the form of the instrument has been deemed of such importance, by some courts, as to render invalid an obligation, joint in form, but signed by the surety alone, we perceive in the form of the bond no insurmountable barrier against giving effect to the contract in
The bond contained various provisions relative to notice of loss, 'etc. By appropriate paragraphs of answer appellant averred a failure on appellee’s part to comply with these provisions. It is contended by appellant that the evidence is insufficient, on these issues, to support the verdict; it is also claimed that the evidence fails to show that Chapman’s defalcations occurred during the life of the bond in suit. We do not deem it necessary to set out the evidence relating to these matters, but content ourselves with the general statement that the verdict is sustained by sufficient evidence on the issues in question.
Complaint is made of instruction No. 8, which informed the jury that in determining whether the bond in suit was delivered by appellant to appellee, they might take into consideration, as tending to show appellant’s intention, at the time of giving possession of the bond to Watson, the evidence given which tended to show that appellant delivered to appellee, at the beginning of his first term, a like bond, unexecuted by the principal. There was no error. The intent of appellant in delivering possession of the bond in its incomplete form, to Watson, with instructions to give it to appellee, was a material fact, in the determination of which, evidence of similar transactions on recent occasions was proper for the jury’s consideration.
Counsel for appellant contend that the court erred in giving certain other instructions, and in refusing certain ones it requested. For the most part, these contentions involve the same legal questions already determined in this
Note. — Reported in 105 N. E. 769. As to the effect of delivery of official bond unsigned by principal obligor, see 12 L. R. A. (N. S.) 1108. For a discussion of the failure of the principal to sign an obligation as affecting the liability of a surety, see 2 Ann. Cas. 225; Ann. Gas. 1912 A 1014. As to the liability of a surety company as distinguished from the liability of an individual surety, see Ann. Cas. 1912 B 1087. See, also, under (1) 32 Cyc. 127; (2) 32 Cyc. 48; (3) 32 Cyc. 306; (4) 25 Cyc. 739; 19 Cyc. 656; (5) 32 Cyc. 132; (6) 32 Cyc. 138; (7, 8) 32 Cyc. 41; (9) 32 Cyc. 139.