Seaside v. Oregon Surety & Casualty Co.

| Or. | May 9, 1916

Mr. Justice Benson

delivered the opinion of the court.

The briefs and the oral argument herein go much further afield than we regard as necessary in our consideration of the issues involved. The one question to be determined is: Did the court err in granting a new trial? If there was any error upon the trial which would be ground for reversal, the order must be affirmed. It was stipulated at the trial that on November 4, 1910, and after the death of Henninger, the defendant received from the plaintiff the following telegram:

“Seaside, Oregon, Nov. 4, 1910.

“Union Guarantee Association, Portland, Oregon:

“E. N. Henninger, town treasurer, bonded by your company has committed suicide.

“F. H. Laighton,

“Acting Mayor.

“R. 0. Ralston,

“Auditor and Police Judge.”

This stipulation also concedes that on January 19, 1911, plaintiff mailéd to defendant, who received it on the same day, the following:

“Seaside, Oregon, January 19, 1911.

“To the President, Gay Lombard, President of the Union Guarantee Association, or President of Oregon Surety & Casualty Company. Office of Said Association, Portland, Oregon.

“Sir: You are hereby notified, and through you as its president notice is hereby given to the Union Guarantee Association, that Edmund N. Henninger, as treasurer of the town of Seaside, Oregon, who committed suicide on or about the 4th day of November, A. D. 1910, was at and prior to his death an embezzler of funds of said town of Seaside to the amount and in the sum of seven thousand nine hundred and forty-nine and 9/100 dollars ($7,949.09), which has not been repaid or made good to said town, and for which said town holds you, as his surety, responsible.

“Town of Seaside.

“[Signed] By F. H. Laighton,

“Acting Mayor and President of Council.

“Attest: R. O. Ralston,

“Auditor and Police Judge.”

At the outset it will be observed that the contract provides for notice to the surety of any act of the treasurer “which may involve a loss for which the association is responsible hereunder, immediately after the occurrence of such act shall come to the knowledge of the employer.” There is also a provision to the effect that any claim for loss shall be presented in writing immediately upon discovery thereof, and that no action thereon shall be prosecuted unless begun within six months after such presentation of claim.

1. It appears to us that both the attorneys and the trial court have confused these two provisions. The telegram above quoted clearly fulfills the first requirement and the letter of January 19th is the only presentation of a claim mentioned in the evidence. It is undisputed that the claim was presented on January 19th, and the action begun with process served upon defendant on July 17th, which is clearly within the six months limited by the contract. The only question, therefore, which might have been properly submitted to the jury upon this phase of the case is as to whether or not the time elapsing between November 4, 1910, and January 19, 1911, was a reasonable compliance with the requirement that the claim should be presented immediately upon the discovery of a loss, which question was not submitted to the jury at all.

2, 3. Again, we note that the court gave this instruction to the jury :

“I instruct you that fraud is not-pleaded in this case by the plaintiff and therefore you must disregard the same in the trial of this case.”

There is no theory upon which this instruction is proper. The complaint distinctly charges that the treasurer embezzled and stole the money. If such acts do not constitute fraud, it would be difficult to frame such a plea. It has been frequently held that fraud and dishonesty are synonymous terms: 2 Words and Phrases (2d Series), 641, and cases there cited. For the reasons mentioned, the judgment must be affirmed ; but it was urged upon us at the argument that in the event of a new trial this court should express its view as to whether the larceny defined in Section 1957, L. O. L., is covered by the language of the bond in question. As we read this statute, it provides that when a public officer receives public moneys, the burden is upon such officer to pay the money to the party entitled thereto or to so account for it as to free his own shirts of dishonesty. Failing to do this, the animus furandi is a legitimate inference.

The judgment is affirmed. Affirmed.

Mr. Chief Justice Moore, Mr. Justice Burnett and Mr. Justice McBride concur.