116 Tenn. 110 | Tenn. | 1905
delivered the opinion of the Court.
The hill in this case is brought by the State of Tennessee, for the use of Fentress county, against James B. Reed, county trustee of that county, and others, his sureties upon his official bonds, to recover $2,853.36, on account of county revenues collected but not accounted for, as required by law, by said Reed.
The defendants, answering, admit the election of Reed as trustee; the execution of the bonds sued on, and the collection of the money which he has not paid over; but they deny that the county is entitled to a decree against them for it. Their defense is that the defendant Reed deposited the county revenues, as collected by him, to his credit as trustee in the Fentress County Savings
The court of chancery appeals, upon the hearing before it, found that the defendant Reed did deposit the county revenues collected by him as trustee to his credit as trustee in the Fentress County Savings Bank; that these funds were kept separate from his private or individual money; and that he received no compensation from the bank for keeping Ms account with it;’that the bank and its officers, at the time he opened his account and deposited the money lost, sustained good reputation for solvency and integrity with the business men and citizens of Fentress county, but that the bank, while the defendant had deposited therein to his credit as trustee $3,491.17, failed and assigned, and in this way, after crediting the pro rata paid by the assets of the bank, $2,853.36 of the county’s revenue was lost.
That court further finds that the defendant Reed lived in the country about eight miles from Jamestown;
That court, upon this finding of facts, held that the •defendant Reed did not exercise that diligence, caution,- and prudence which public officers are required to do in the selection of a depository for public funds in their hands, and that, in depositing the money in the Fentress. •County Savings Bank, he was guilty of negligence, and lie and his sureties should be held for such loss, and de
This court did hold in that case that a public officer holds the funds that come into his hands in the discharge of the duties of his office as trustee to be disposed of as provided by law; that he is not an insurer of the safety of such funds, but is bound only for the exercise of good faith, proper diligence, caution, and prudence in their management and safe-keeping. It is further held that it is not negligence or want of proper business prudence and caution to deposit the funds in a bank of undoubted standing and reputation for solvency, and in case of loss by failure of the bank, the officer will not be held to make it good.
But the facts in this case are widely variant from those found by the court in that, and fall far short of bringing it within the rule there announced and applied. The defendant Reed wholly failed to exercise the diligence, caution, and prudence which the law, as announced in that case, required him to do in selecting a safe and solvent bank in which to deposit the trust funds in his hands, if he desired to make that disposition of them, for it was entirely optional with him; and he was also guilty of culpable negligence in failing to avail himself of all the opportunities and facilities at his command for investigating and ascertaining the condition of the depository selected. Mere inquiry of the general public,
The defendant Reed, as a director of the Fentress County Savings Bank, had access to its books, and with ordinary c'apacity and the exercise of ordinary intelli
He has failed to make out a case for exoneration from the results of his own misconduct, and must bear the consequent loss. Affirmed.