269 Pa. 456 | Pa. | 1921
Opinion by
On November 20, 1917, Charles A. Ambler, then being insurance commissioner of the Commonwealth of Pennsylvania, opened a savings fund account in the North Penn Bank of Philadelphia, in the name of “Charles A. Ambler, Receiver of the Pittsburgh Life and Trust Company, dissolved”; the moneys therein deposited being received and held by him virtute officii, the company to which they belonged having been dissolved, and its assets ordered to be collected and distributed, in accordance with the provisions of the Act of June 1,1911, P. L. 599, later reenacted and extended by the Act of May 21, 1919, P. L. 209. As security for the payment of the de
On March 15, 1919, Thomas B. Donaldson became insurance commissioner in Ambler’s place and stead. For some reason not appearing in the evidence, — but immaterial to the present controversy since it had no relation to the bank’s ability to pay, — Donaldson preferred to have the account remain in Ambler’s name and that the latter should liquidate it, all moneys received therefrom to be paid, however, to him, Donaldson. At this time the amount due by the bank was $402,265.39 which was so far in excess of the surety bonds already given, that Ambler thought it wise to secure an additional bond in the sum of $100,000. This he requested the bank to furnish, and accordingly it asked the National Surety Company to give such additional bond; but, as that company felt it had as much liability in this matter as a wise business policy dictated, its agent requested the Hartford Accident and Indemnity Company, the defendant in this case, to take the risk, which the latter agreed to do, without requiring the usual written application to be made, provided only a five days’ cancellation clause was inserted in the bond. This was assented to, the bond was thereupon issued on April 22, 1919, was delivered to Ambler on May 19, 1919, and he retained it until its redelivery to defendant as hereinafter set forth.
The bond was drawn (as requested by the bank) in favor of the “Insurance Commissioner of the Commonwealth of Pennsylvania (hereinafter called the depositor)”; recited that the “bank has been designated as a depository of certain moneys of the depositor or for the custody of which the depositor is or may be responsible,” and made the bank, as principal, and defendant, as surety, “jointly and severally” liable upon the condition that if the bank, during the year beginning April 23, 1919, should “promptly account for and in due and ordinary course of business pay over on legal demand all
Subsequently, at the request of defendant, the bank sent a formal application for the bond. It contained several untrue statements; but since they were made after the issuing of the bond and without the knowledge of either Ambler or Donaldson, they cannot affect this controversy: Johnston v. Patterson, 114 Pa. 398; Kulp v. Brant, 162 Pa. 222, 226; Park Paving Co. v. Kraft, 262 Pa. 178.
. Donaldson afterwards learned the bond had been issued in favor of the “Insurance Commissioner of the Commonwealth of Pennsylvania/’ and not in the name in which the bank account stood, and therefore requested Ambler to get the name on the bond changed so as to accord with the account. At the latter’s request, the bank thereupon wrote a letter to defendant giving the title of the account and-requesting that an endorsement be made on the bond so as to make it accord with the account. To this request, defendant (which, as its superintendent afterwards testified, did not care in whose favor the bond ran) replied that his company would rather not make the changes in the form of an endorsement, but, if the existing bond was returned, would “execute a new bond in accordance with the changes suggested.” The bank thereupon obtained the bond from Ambler, and mailed it to defendant on July 15, 1919; the latter still retains it and has never offered to return it, and there is an admission in its paper-book “that the legal effect of the......correspondence between the bank and the surety was a contract to assume liability for Ambler’s deposit in consideration of the surrender of the old bond for cancellation.”
After banking hours on July 17, 1919, defendant mailed to the bank a letter acknowledging the receipt of the old bond and enclosing a new one, exactly in the form agreed upon, and these were received the next day
In tbe meantime Ambler bad withdrawn from tbe account certain sums of money, all by checks in favor of Donaldson as insurance commissioner, though tbe cashier of tbe bank claimed that, as it was a savings fund account, tbe bank was entitled to thirty days’ notice of withdrawal. At various times tbe cashier requested that tbe account should not all be withdrawn at once, because, as be said, tbe bank was a small one and bad subscribed to war loans in a very large amount; but be alleged it could and would pay it all if required so to do. On July 12, 1919, Ambler gave to Donaldson a $30,000 check drawn on tbe account. At this time a bank examiner was investigating tbe affairs of tbe bank, — as is periodically done in tbe case of all banks, — and tbe cashier requested this check should not be presented for a few days, because be wished tbe examiner’s report to show a large amount .of deposits. To this Donaldson assented, as was customary where banks were small and their war loans large. About noon of July 17, 1919, be and Ambler were advised, for tbe first time, that tbe
In a charge which is a model of clearness, and must have been as readily understood by the jury as it is by ' us, the trial judge told them that the new bond became effective, if at all, as of the date of its mailing on July 17, 1919, that if they found Ambler at this time knew of the condition of the bank, it was his duty to disclose the fact to defendant, and if they believed the latter would not have delivered the bond had this fact been made known to it, they should find in its favor; otherwise they should find in favor of plaintiff in the sum of $56,597.05, which the parties agreed was the amount due. The jury rendered a verdict for defendant; plaintiff moved for a new trial and for judgment non obstante veredicto, both of which motions were dismissed, and this appeal followed.
We cannot assent to the judgment thus obtained, because the rules of law which govern the original undertaking of an individual surety are not applicable to the essentially different facts above set forth. If the first bond was still in force we would be constrained to hold that defendant was liable upon it. As already pointed out, it ran in favor of the insurance commissioner as “depositor,” and covered all deposits “for the custody of which the depositor is or may be responsible.,” Donaldson, as insurance commissioner, was in law the equi
Morepver, defendant would be liable on its contract to deliver the new bond upon the return of the old, exactly as is now claimed, even if the new bond had never been sent, since thereby a binding contract, definite in all its terms, was duly effected; and the new bond, as subsequently sent, was but putting in written form that which had already been agreed upon: Tayloe v. Merchant’s Fire Ins. Co., 50 U. S. 390; Lansdowne v. Citizens Electric Light & Power Co., 206 Pa. 188; Smith v. Kaufman, 30 Pa. Superior Ct. 265. When, then, plaintiff returned the old bond, he had fully performed his part of the contract, and defendant’s receipt and retention of the bond thus returned bound it also to full compliance, and it could be held liable thereon even though the new bond had never been mailed. Its contention that it had the right to keep the first bond, the return of which was the consideration of the second, and still claim that the lat
The damages agreed on being the sum of $56,597.05, as of the date of the trial on November 10,1920, we shall direct final judgment accordingly.
The judgment of the court below is reversed, and the record is remitted with directions to enter judgment for plaintiffs for $56,597.05, with interest from November 10,1920, to the date of entry of said judgment.