189 Ind. 311 | Ind. | 1920

Myers, J.

Appellee brought this suit against appellants to recover $24,969.67 and interest, money alleged to have been loaned by it to appellants.. Tbe complaint was in three paragraphs. Tbe first paragraph was for money loaned to tbe appellant Bankers Surety Company by appellee at various times, and in various amounts, as shown by a statement made a part thereof by exhibit and evidenced by promissory *314notes made a part thereof by exhibits 1 to 56, inclusive. The second paragraph counted upon fifty-six promissory notes payable to appellee, each bearing a different date and aggregating $24,969.67, alleged to have been executed by appellant and the firm of Neisler and Shryer. The third paragraph proceeded upon the theory of an indebtedness by appellant to appellee on account of money had and received for the use and benefit of the Bankers Surety Company. The Bankers Surety Company answered in three paragraphs. The first was a general denial. The second and third were partial answers verified by its secretary, denying the execution of all promissory notes exhibited in the complaint other than exhibits 1 to 8, inclusive, calling for $7,525, and $475 included in exhibit 9, which was a note for $550. Appellee replied by a general denial, and also that the surety company, with knowledge of the facts, ratified the acts of its agent in borrowing the money from appellee and indorsing its name on each of the notes of which it now denies execution. The issues thus formed were submitted to the court, trial was had, and, at the request of the surety company, a special finding of facts was made and conclusions of law stated thereon. Judgment in favor of appellee for $37,507.23, of which $13,310.14 was without relief.

The overruling of the surety company’s motion for a new. trial is assigned as error, and is the only error relied on for a reversal of the judgment. The causes relied on by the appellant surety company in support of its motion are: (1) That the decision of the court is not sustained by sufficient evidence; (2) that the decision of the court is contrary to law; and (3) *315alleged erroneous rulings' of the court in admitting and rejecting certain items of evidence.

1. 2. From all that is said by the parties to this appeal, it may be taken as conceded that the decision of the court as shown by the special finding of facts sustains the conclusions of law. But in this connection our attention is called to certain specific findings, eleven in all out of thirty-three, said to have no evidence to support them, or, in other words, that certain facts found within the issues essential to a recovery by appellee are unsupported by any evidence. It must be kept in mind that the motion for a new trial is in effect an attack on the facts specially found as a whole (Weaver v. Apple [1897], 147 Ind. 304, 46 N. E. 642), but that we are only concerned with such of these facts as are within the issues and necessary to uphold the conclusions of law. Major v. Miller (1905), 165 Ind. 275, 278, 75 N. E. 159; Ginther v. Rochester, etc., Co. (1910), 46 Ind. App. 378, 384, 92 N. E. 698. Also, in passing on the evidence to support the court’s decision, we consider only such evidence and the reasonable inferences to be drawn therefrom as tends to sustain the material findings. Robinson & Co. v. Hathaway (1898), 150 Ind. 679, 50 N. E. 883; Heath v. Sheets (1905), 164 Ind. 665, 74 N. E. 505; Rimel Spoke, etc., Co. v. Loper (1917), 65 Ind. App. 479, 117 N. E. 527.

At this point a brief statement of the undisputed facts may be useful for a better understanding of the questions for decision. In the years 1908 and 1909 appellee was an incorporated company under the laws of Indiana and authorized to make loans. The Bankers Surety Company was also an incorporated com*316pany under the laws' of Ohio, and authorized to become surety on bonds of contractors for public and municipal work. On August 4,1908, the firm of Neisler and Shryer entered into a contract with the city of Delphi for the construction of certain sidewalks, curbs, gutters, roadways, sewers'thereunder, and, if required by the city, certain retaining walls. The amount of construction under this contract was to be determined by the city’s civil engineer, but the price to be paid for, such construction was a certain stated amount per lineal foot, per square yard, or per square foot, or per cubic yard, according to the actual amount thereof required and done. The contract contained a stipulation whereby the contractors agreed to pay any and all money due to any contractor, person or persons furnishing any material for the work, and to pay any laborers employed by them for any work done in the prosecution of the improvement. For the faithful performance of this contract the contractors executed a bond to the city of Delphi in the penalty of $8,000, with appellant suretjr company as surety thereon, conditioned for the full execution and completion of said contract according to the true intent and meaning thereof and the payment for all material and labor employed in connection therewith. The contractors entered upon the execution of the contract and did a large amount of work required thereby, and in so doing exhausted their finances and credit, and were unable to pay for labor and material variously estimated at from $6,000 to $8,000, and necessary to further execute the contract as originally contemplated. During all of the time covering these, transactions and those hereinafter mentioned Orín *317Walker was tlie general and duly authorized agent in and for the State of Indiana for the Bankers Surety Company in the general prosecution of its business in this state. That the surety company through its said agent borrowed from appellee at various times and in various amounts between October 20,1908, and December 28, 1908, aggregating in all $7,525, for which promissory notes were executed to appellee by the firm of Neisler and Shryer and indorsed “The Bankers Surety Company, Orin D. Walker attorney in fact.” That the sums so borrowed were by tire agreement of the parties to be repaid to appellee by the surety company on demand, together with eight per cent, interest per annum thereon from the date of each respective item loaned. That Walker’s act in making the indorsement on the first eight notes was pursuant to a power of attorney from the surety company authorizing him to borrow $8,000. That after the execution of the eight notes in all calling for $7,525 and $475, aggregating $8,000, which was received and expended by Walker in the prosecution of the work under the Delphi contract, and it was found that the retaining walls mentioned in the contract were necessary, and were ordered by the city of Delphi to be constructed, thereby increasing the cost of the work under the contract greatly'in excess of the original estimate. That by reason of the additional work it was necessary to have an additional sum of money to carry on the work according to the contract and which work was being done and continued by the surety company’s agent, and for that purpose the surety company’s agent borrowed from appellee the various amounts alleged in the complaint, aggregat*318ing $16,458.75, all of which, various amounts were borrowed from appellee between December 28, 1908, and November 13, 1909. That all of the money so loaned by appellee was paid by it to the surety company’s agent and used by its agent in paying for labor and material in completing the work under the Delphi contract. That about one year after the last loan was made and before the commencement of this suit the appellee demanded of the surety company the payment of all the notes and the money so loaned by it to the surety company. That all of the money so used by the surety company’s agent on account of the Delphi work was borrowed from appellee, and no part thereof has been repaid. That after the completion of all work in compliance with the contract the surety company procured to be made to itself by the firm of Neisler and Shryer, for its protection, the prospective assessment roll which under said contract was to be made by the city of Delphi which assessment roll the surety company still holds.

There is no serious controversy over the surety company’s liability to pay the first $8,000 borrowed from appellee, but as to any further liability to appellee it earnestly denies. Hereafter our attention will be directed exclusively to matters involving the alleged indebtedness of the surety company over and above $8,000. In respect to this indebtedness, it insists that certain findings are not supported by the evidence, and that certain evidence was improperly admitted. These contentions will be considered together.

Appellant insists that, while Walker was its general agent for the purpose of conducting its surety *319business in the State of Indiana, and matters necessarily incident thereto, yet such agency would not authorize him to borrow money on its credit, even though such money was for the purpose of completing a contract of a defaulting contractor on whose bond for the performance of such contract it had become surety.

The authority of Walker to borrow the money on the credit of appellant is the vital question. As we read the record in this case, the above claim of appellant may be admitted, and still there would be a clear liability on its part to the appellee for the repayment of the money received by Walker in excess of the $8,000.

Conceding that Walker, as general agent of appellant, had no authority to borrow the money, a question on which we express no opinion, we may then look to the claim of special authority which appellant denies on the ground that there is no competent evidence in the record showing special authority, nor that the acts of Walker in borrowing the money were at any time ratified by it. Appellant further contends that the trial court’s conclusions of law holding it liable for the money alleged to have been borrowed in excess of the $8,000 rests alone upon Walker’s authority as general agent. We do not so construe the trial court’s findings, nor do we believe the evidence warrants such a limitation to be placed upon them, nor can we agree with appellant .that there is no evidence showing special authority from it to Walker to borrow the money in question, nor that there is no evidence to show ratification.

*3203. *319In determining whether or not the evidence sup*320ports the findings, it is proper to consider not only the direct evidence, bnt any evidence before the trial court tending to show the situation and circumstances present at the time of the alleged transactions. It appears that Neisler and Shryer’s contract stipulated that they should pay all bills for material and labor, and the penalty of thé bond securing the performance of that contract was $8,000. Prior to the transactions in question, the surety company confessedly, by Walker, borrowed from appellee $8,000, and expended the same under the direction of Walker in the prosecution of the first instance work, but with this expenditure the full scope of the contract was not completed, nor can it be said that by the expenditure of the $8,000, as was done, its liability on the bond was terminated. Aetna Indemnity Co. v. Indianapolis, etc., Fuel Co. (1912), 178 Ind. 70, 98 N. E. 706; Fidelity, etc., Co. v. American Blower Co. (1918), 41 Ind. App. 620, 84 N. E. 555.

There is no doubt that Walker, to the knowledge of appellant, looked after paying the bills incurred on account of the original as well as the additional work from the time the contractors became financially unable to proceed with it. No person, other than Walker, at any time, assumed to act in this matter for the company. Walker' testified that when the necessity for additional money for the prosecution of the additional work ordered arose, he went to Cleveland, and, at the home office of the company he laid before its committee in charge of matters of this character the necessity for additional money, and by that committee he was instructed to go ahead and *321do as he had been doing. That it would be better for him to get the money from appellee than for the surety company to advance it. That he should go ahead and get what money was needed to carry out the contract, but nothing was said about what papers he was to execute for the funds. He returned to Indianapolis, saw the treasurer of appellee, and arranged to get the money to carry out the contract. As the money was needed, notes were taken to the office of appellee and indorsed as was previously done; checks for the money were received by him and cashed, and the money used to pay for labor and materials on the Delphi work.

4. The objections to this evidence were not well taken, for the reason that it cannot be classed as admissions and declarations of an .alleged .agent for the purpose of proving either the existence of the agency or the extent of his authority, as it had

reference to the declarations and admissions only of the principal which were competent evidence against it to show its relations with Walker who might properly testify to them. 1 Clarke and Skyles, Law of Agency p. 170, §67; Wolf v. Smith (1860), 14 Ind. 360; Butts v. Warren Machine Co. (1914), 55 Ind. App. 347, 103 N. E. 812.

5. Walker’s evidence, which is corroborated by many circumstances, is sufficient to sustain the finding of the court that he had express authority from appellant to borrow the money necessary to - complete the work, and that the money was borrowed pursuant to the authority thus conferred.

*3226. 7. *321Mr. Seidensticker, treasurer of appellee, was permitted to testify, over the objection and exception of *322appellant, that Mr. Walker came to him and said that he had been to Cleveland, and that they had authorized him to borrow additional money.- This evidence was not admissible, for the reason that the declarations of a person assuming' to act for another are not admissible to prove his agency or the scope of his authority. Blair-Baker Horse Co. v. First Nat. Bank (1905), 164 Ind. 77, 83, 72 N. E. 1027; Cleveland, etc., R. Co. v. Closser (1890), 126 Ind. 348, 26 N. E. 159, 22 Am. St. 593, 9 L. R. A. 754; Indiana Union Traction Co. v. Scribner (1911), 47 Ind. App. 621, 93 N. E. 1014. However, the admission of this testimony cannot be regarded as reversible error, in view of Mr. Walker’s evidence, which stated fully the instructions which he received at the home office of appellant with reference to borrowing additional money with which to complete the additional work.

The notes and the indorsements thereon identified as exhibits 9 to 56, inclusive, being the notes executed for money loaned in excess of the first $8,000, .were introduced in evidence over the objections of appellant. Whether this ruling was right or wrong, it was not reversible error, for it affirmatively appearsv from the record that appellant was not thereby harmed. The court found that these notes were not binding obligations of appellant, but it did find in favor of appellee for the money loaned after January ¡4,1909, with six per cent, interest thereon.

8. Under the theory of the third paragraph of complaint the checks of appellee for the various amounts of money and payable to the order of “O. D. Walker, Agent,” were properly admitted in evidence as tending to show that Walker received the money.

*323Appellant also insists that its failure to execute an additional power of attorney was sufficient to warn appellee not to furnish any more money on its account. Whatever inference this fact might authorize, it must be taken in connection with the fact that the power of attorney mentioned had reference only to the indorsement of notes, and to that extent only could it serve any purpose in future transactions as to the question of the diligence of appellee. In view of our conclusion that Walker was expressly authorized by appellant to borrow the money on appellant’s credit, the question of diligence becomes unimportant and of no controlling influence.

9. Ihe court found that the surety company had ratified the acts of Walker, in borrowing the money from appellee, and this finding is challenged for the. want of evidence. It appears from the evidence that appellant is now holding the assignment of the prospective assessment roll, covering not only the work done under the original contract, but also an assignment of the prospective assessment roll for the additional work done in completing the second award. Also, that on January .30, 1911, in the District Court of Indiana, suit was brought by appellant against the city of Delphi demanding $40,000 on account of money alleged to have been furnished by it to the contractors of the Delphi work and by them used in paying for material and labor in the furtherance of the contract. These and other facts shown in evidence are clearly sufficient to support a finding of ratification. *32410.

*323• In conclusion, appellant insists that certain findings of the court are in irreconcilable conflict with certain *324other findings, and because of such conflict the judgment cannot stand. In support of its position it cites, among other cases, Learned v. Castle (1889), 78 Cal. 454, 18 Pac. 872, 21 Pac. 11; Whalen v. Stuart (1909), 194 N. Y. 495, 87 N. E. 819, holding that, when findings as to matters material to the merits and essential-to support the judgment are in irreconcilable conflict with other findings which would overthrow it, then the judgment should be reversed. The cases to which we are. referred do' not rule the instant case, for the reason that neither the conclusions of law nor the judgment would be affected by the claimed conflict.

If we are correct in holding that the evidence supports the finding that Walker was authorized by appellant to borrow the money and proceed with the work, and also that appellant ratified the acts of Walker in borrowing the money and completing the work, then in either eyent the conclusions of law would be with appellee, and the judgment should stand.

Finding no reversible error in the record, the judgment is affirmed.

Harvey, J., not participating.
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