169 Mo. 507 | Mo. | 1902
— Plaintiff is incorporated as a building and loan association under the laws of this State. Defendant Obert was the secretary of the plaintiff corporation; the Fidelity and Deposit Company of Maryland, a corporation, was the surety on the secretary’s bonds. The petition is in two counts. The first is on a bond for $5,000 penalty, dated October 28, 1895, payable to the plaintiff, signed by defendants, conditioned for the faithful performance of his duties by Secretary Obert. There are assigned for breaches of the condition of this bond, nine acts of defendant Obert, each of which consisted in collecting, in his capacity as secretary, a certain sum of money and converting it to his own use. ■ The
The second count is on a bond in all respects like that described in the first except the date, which is February 17, 1897, and except, also, as to the- signature of Obert about which there is a question. Thei*e are assigned for breaches of this bond several defalcations, beginning March 23d and ending September 1, 1897, aggregating $4,712’.94.
The defendant Obert filed no answer and default was entered against him. The Fidelity and Deposit Company answered, admitting the execution of the bond sued on in the first count, but averring that it expired February 17, 1896, and that this defendant was not liable on it for acts of Obert after that date; also that plaintiff, in violation of its charter powers, borrowed money and placed the same in the hands of the secretary and thereby cast on him responsibilities not authorized by law, and the plaintiff’s loss, if any, was occasioned by that means, and the bond did not cover such acts.
The answer to the second count is to the effect that the principal, Obert, never signed the bond, and therefore the defendant corporation as surety did not become obligated; and also the plea that plaintiff borrowed money and placed it in Obert’s hands and thus increased his responsibility, etc., as in the answer to’the first count.
During the trial the plaintiff filed an amended petition to which, for answer, the defendant refiled its answer to the original petition. There had been a reply filed to the answer to the first petition, but it was not refiled after the answer was refiled to the amended petition. Upon the trial, however, the pleadings were treated as if the reply was filed and the issues joined on the new matter pleaded in the answer. The ease was tried by the court without a jury. There was evi
The defendant appeals and assigns for error: first, that the court erred in holding appellant liable on the first count for defalcations of Obert occurring after March 20, 1896; second, the court erred in holding appellant liable on the second count at all, because the bond sued on in that count was not signed by Obert, the nominal principal. Our consideration of the ease will be limited to those two points.
I. In support of its proposition that the surety on the bond for the faithful performance of the official duties of the principal is not liable for defalcations occurring after the expiration of the prescribed term of office, the learned counsel for appellant cite a long list of adjudicated cases and text-writers, and a reference to their brief will show all the authorities on that point that could be desired. The proposition in its general terms is conpeded by the learned counsel for respondént, but they contend in the first place that it is qualified in this, that if it appears that it was the intention of the parties to the contract that the bond was to cover the acts of the officer not only during the period of the first prescribed term, but also during the period of his actual con
' The evidence shows that Obert was elected or appointed secretary of the plaintiff corporation in January, 1891, and was holding the position in October, 1895,,when he applied to the appellant to become surety for him. This action was taken to comply with the requirement in that respect of the act- of the General Assembly, approved April 20, 1895 (Laws 1895, p. 105). Appellant in response to that application executed the bond sued on in the first count of the petition and received therefor $50 as the premium for one year. The bond is dated October 28, 1895, conditioned for the faithful performance by the principal of his duties as secretary and is not by its terms limited in duration.
The only evidence bearing on the question of the term of the secretary’s office is to the effect that he was elected or appointed in January, 1891, was in that position when he made the application to appellant to become his surety in October, 1895, and also the record of the meeting of the board of directors of the plaintiff corporation, March 18, 1896, in which this- appears: “John C. Obert, was nominated for secretary and nominations closed, and president cast ballot.” The act of the General Assembly above referred to directs that
- There is no doubt, therefore, that it was the intention of both parties to the contract, that the bond was to cover
II. The answer to the second count is that the appellant as surety was not liable on the bond declared on because it was not signed by the principal.
Bespondent presents the point that this is equivalent to a plea denying the execution of the instrument sued on, and is insufficient because not verified by oath. [Sec. 746, R. S. 1899.] If that point is properly in this case it would require an interpretation of that statute in its application to a different state of facts from those in the light of which we have heretofore construed it. We have decided that the object of the statute was to relieve tho plaintiff, or other party pleading it, from the necessity of proving the signature and other acts necessary to the execution of the instrument. [Hart v. Harrison, 91 Mo. l. c. 422.] At common law a bond-sued on could not be read in evidence until proof was made that it was signed,,sealed and delivered by the alleged obligor. ■Our statute was designed to obviate the necessity of that proof unless the execution was denied under oath. Hut we have never yet decided that when the plaintiff himself produces in evidence the instrument sued on and it shows on its face that it has not been signed, that the statute requires us to say that it has been signed or that the fact of its execution is immaterial. Proof of the execution may be waived, but the fact of execution is still essential. That point, however, was not made in the trial court; the case was there tried on the theory 'that the execution of the bond by Obert was a fact in issue and proof on the issue was heard. If the point had
That is the signature which respondent thinks amounts to a signing of the bond by Obert as principal.
There is no doubt that a party may become bound in an instrument by signing it in any part, when he signs with that intention. [State v. Wilcox, 59 Mo. 176.] But the signature of Obert in the connection above given shows that it was merely to attest as secretary the signature of the vice-president and the seal of the corporation to the memorandum of approval of. the bo'nd by the board of directors. That was not intended as a signing of the bond by Obert as principal, and it can not be so construed.
Respondent also insists that the second bond is, in effect, but a renewal or continuation for another year of the first bond, like an insurance policy, and in support of this refers to the letter of appellant to Obert of date February 11, 1891, inclosing the second bond and designating it as “our renewal bond No. 26368-A.” But that theory will not avail the plaintiff, because the penalty of the first, or as plaintiff would
It is said in the brief of the learned counsel for respondent: “The only practical reason why Obert should sign the bond at all was that in case of default the company might have his written obligation to reimburse them.” And in that connection attention is called to- the written application of Obert for the first bond in which he obligates himself to reimburse the defendant corporation for all loss, etc., that might occur on the bond or on any renewal thereof. If the only purpose in signing the bond as principal wus as suggested by counsel, the clause in the application referred to would seem to cover the omission. But the practical effect of the signature by the principal is more than is suggested. It would authorize the plaintiff to sire and recover in one judgment against him as well as the surety, and such judgment would obviate the necessity of another suit by the surety on the collateral agreement. It would also place the surety in position to avail himself of the various provisions for his nrotection contained in chapter 58, Revised Statutes 1899. It is also contended that this bond differs from the ordinary bonds given to secure the faithful performance of his duties by the principal, as such bonds were until the recent introduction of corporations organized as this defendant is, to become such surety as a matter of business for profit; that this defendant stands rather in the light of an insurer to the employer against-loss by misconduct of his employee and that, therefore, the strict rules of law regarding the rights and liabilities of sureties do not apply. There is much force in the argument, but it is not sustained by the theory of the plaintiff’s7petition. The instrument sued on is not declared to be an agreement between plaintiff and appellant- for insurance or indemnity. It is declared to be a bond executed by a principal and a surety (which -indeed is. the only theory the case afforded) and the
Under the, record in this ease, the judgment should have been for appellant on the second count The judgment of the circuit court is therefore affirmed as to the first and reversed as to the second count in the petition.