137 P. 616 | Cal. Ct. App. | 1913
This is an action on a receiver's bond. Plaintiffs had judgment, from which and from the order denying their motion for a new trial defendants appeal.
One John S. Noble commenced an action for an injunction, in the superior court of Napa County, against the plaintiffs in this action, wherein he sought to procure the appointment of a receiver pendente lite, to take and retain exclusive possession of certain real and personal property at the time used in the furniture and undertaking business by and in the possession of and belonging to them. The court appointed a receiver in the action on Noble's ex parte application upon filing a statutory bond in the sum of ten thousand dollars, executed by Noble as principal and the defendants in this action, Mooney and Davis, as sureties. Thereupon, the receiver entered upon the discharge of his duties and took possession of all the property involved, excluding the plaintiffs herein therefrom. Later on the court required a further bond of five thousand dollars to be given and it was executed by the same principal and sureties and was filed in the action. Subsequently, the defendants in that action (plaintiffs herein) gave notice of a motion to vacate and annul the order so appointing the receiver, accompanied by certain affidavits. Before the date set for the hearing of said motion, Noble, plaintiff in said action, voluntarily dismissed his action and caused a judgment of dismissal to be entered therein. The present suit followed to recover damages sustained by reason of the appointment of the receiver.
The court found that plaintiffs had been damaged in the sum of $1,105.80. No question arises as to the sufficiency of the evidence to sustain this finding. The court also found that Noble, in his said action, "did wrongfully and without sufficient cause procure the appointment of said receiver and his continuance in office in said action."
The judgment of dismissal of said action was as follows:
"JUDGMENT OF DISMISSAL.
("Title of Court and Cause.)
"The plaintiff herein having made an order for the dismissal of the above entitled action and the clerk having made an entry of dismissal thereof in his Register of Actions, *235
"Therefore, by virtue of the law and by reason of the premises aforesaid (no trial in said case having been had),
"It is ordered, adjudged and decreed that the above entitled case be and the same is hereby dismissed.
"Judgment entered April 11th, A.D. 1907.
(Seal) "N.W. COLLINS, "Clerk of the Superior Court. "Clerk's office of the Superior Court, and for the County of Napa, State of California."
(Endorsed) "Filed April 11th, 1907."
At the trial defendants offered to prove the facts set out in the complaint and amended complaint in the action brought by Noble against the plaintiffs herein. The court sustained the objection of plaintiffs to such evidence and there was no evidence introduced by either plaintiffs or defendants in support of the averment of the complaint and the finding of the court that the appointment of the receiver was procured wrongfully or without sufficient cause, except the said judgment of dismissal hereinbefore set forth.
Appellants assigned as error the insufficiency of the evidence to show that the appointment of the said receiver was procured wrongfully or without sufficient cause. This presents the sole question in the case.
Section
No case is cited and we have found none where the action was on a receiver's bond after dismissal by the plaintiff of the action in which the bond was given. The question is, Did the dismissal of the action against the plaintiffs by Noble have the effect to finally decide that the appointment of the receiver was procured wrongfully or without sufficient cause? In the absence of an adjudication of the precise question a solution must be sought upon principle and by resort to cases as nearly analogous as may be. *236
It is not to be doubted that the dismissal of the action in which the injunction was issued was a dissolution of the injunction and the discharge of the receiver and discharged the sureties on his bond from any subsequent liability. Their engagement relates to that action and none other and when it was dismissed all their obligations terminated except such as had already accrued. The fact that the plaintiff, Noble, might bring another similar action does not concern the sureties in the dismissed action nor can it affect their liability, for their bond has no relation to a subsequent action. We think it is equally true that, in the absence of fraud or collusion, the sureties are bound by the judgment against their principal in the proceeding to the extent of their engagements in the bond. Had the court, on a hearing on the merits, determined that the appointment of the receiver had been procured wrongfully or without sufficient cause, such judgment would have been conclusive against the sureties. Mr. Freeman says: "It seems to be generally conceded that whenever a surety has contracted in reference to the conduct of one of the parties in some suit or proceeding in the courts he is concluded by the judgment." (1 Freeman on Judgments, sec. 180 [3d ed.].) The author cites many examples of cases, such as injunction bonds; sureties who have become parties to a bond for the delivery of property replevined; or to dissolve an attachment, or to release attached property; sureties upon the bond of an administrator or executor — instances, too, where the responsibility of sureties is fixed in suits to which they were not parties, and in which they were not tendered an opportunity to defend. The rule is given in Braiden v. Mercer,
The court cannot appoint the receiver until the undertaking is given and in it the sureties engage that if their principal procures the appointment wrongfully or without sufficient cause, they will pay all damages sustained by reason thereof. They distinctly "contract with reference to the conduct of one of the parties" to the suit. *237
The question was quite fully discussed by Mr. Justice Brewer, in Hoge v. Norton,
In Dowling v. Polack,
In Fowler v. Frisbie,
In Asevado v. Orr,
In Frahm v. Walton,
In the case last cited a motion of defendants was pending for the discharge of the injunction, as there was here a motion to discharge the receiver supported by affidavits, but the plaintiffs did not wait for the hearing of the motion. The court said that plaintiffs could not deprive the defendants of their right to compensation by "rushing to the clerk's office and dismissing the action before the court could make an order upon the motion."
In Lothrop v. Southworth,
The engagement of a surety on an injunction bond is "to the effect that he will pay to the party enjoined such damages . . . as such party may sustain . . . if the court finally decides that the applicant was not entitled thereto." (Code Civ. Proc., sec. 529.) In Asevado v. Orr,
In the Kansas case, Mr. Justice Brewer points out that the view urged by appellant "exposes to this possible result":
Unless the judgment of dismissal is conclusive on the sureties as well as upon the principal, as respects their liability for compensatory damages, a retrial of the issue in an action on the bond might result in a verdict, if tried by a jury, in favor of the sureties and become final upon appeal. Thus we would have two conflicting judgments upon the same issues of fact. While such a result may not always be avoided it should not be allowed to happen unless imperative rules of law would sanction it as necessary to avoid doing some greater injustice. We do not think it unreasonable to hold that the sureties contracted with knowledge that their principal had the right, and might exercise it, to dismiss his action, to be followed by such consequences as the law would impose. The pleadings in the original action show that it was brought to enjoin the defendants (plaintiffs here) from interfering with real and personal property involved. The appointment of a receiver was ancillary to that action and not its main object. It would seem to us that this furnishes some reason for applying *240 the rule governing the liability of sureties on the injunction bond. There is no reason why the rule in actions on injunction bonds should prevail to allow the recovery of damages upon the dismissal of the action and deny it on the receiver's bond, given in the same action, unless the terms of the latter bond compel it, and we do not think they do. Besides, as intimated above, the appointment of the receiver necessarily depends upon the right to the injunction and when that right is swept away it carries with it all justification for appointing the receiver. If the injunction was improperly issued it must follow that the appointment of the receiver was without sufficient cause.
Appellant cites many cases illustrating the liability of sureties on official bonds. These cases are not in point. In those cases the sureties, as was said in Pico v. Webster,
Cases cited by appellant for malicious prosecution and the like are not in point. No question of motive or probable cause is here involved. (Asevado v. Orr,
The judgment and order are affirmed.
Hart, J., and Burnett, J., concurred.
A petition to have the cause heard in the supreme court, after judgment in the district court of appeal, was denied by the supreme court on January 10, 1914. *241