FLEETFORD et al.
May 9, 1888.)
(Cliro'Uit Court. D. Colorado.
'INJUNCTION-MODIFICATION-MoTION BEFORE ANOTHER JUDGE-U:RGENCY.
Unless the necessity is so urgent as to require immediate action, an injunction will not be modified. changed, or set aside, except by the same judge who granted it.
Motion to modify injunction. S. P. Rose and H. W. Hobson, for complainant. T. R. Ower and O. D. F. Green, for defendants.
BREWER, J. This is a motion to modify an injunction order made by the district judge on the 18th day of April. I had occasion last term, in deciding a case, to say to counsel that as a rule injunctions issued by one judge would remain, uIJless modified, changed, or set aside by the same judge. I need not repeat the reasons which were then stated. Judge HALLETT being away when this motion was presented, it seemed to me that it might prove an exception to that rule; that I might be justified in making an examination of the papers, and seeing if any emergency required immediate action. I have examined them. They are quite voluminous, and while I think it would be right to make the modifications which are asked; those modifications being simply to the effect that the party in charge should be some indifferent person, and not one who had been heretofore the active supporter of either of the parties, and also that each party should be allowed to go upon the premises for inspection. Each of these things I think ought to be done. It is very evident, from an examination of these voluminous pleadings, that there is going to be a protracted controversy. It is very evident from the affidavits that there has been a good deal of quarreling between these parties, who are joint owners of the property. It is very evident that there is deep feeling existing between them. So;r think it can be
PHILLIPS V. BOSSARD.
in thecol1rse of that litigation, to have someone in charge who has never beeh' identified with either party; who would be therefore free from suspicion, to say the ,least. Yet, after examining these papers, I do not see that there is that urgency for immediate action that would now justify me in putting some one besides Mr. Mitchel'l in control. The powers given him are limited. If he should remain ten days or two weeks longer, until the district judge can examine this, I think no harm will be done to either side. And so, although I think the parties would be entitled to the relief they ask, I shall pro forrita overlulethemotion, giving leave to renew it before the district judge as soon as he returns.
PHILLIPS '11. BOSSARD
May 22, 1888.)
,District OQUre, D. South Oarolina.
BANES AND lJANKING-NATIONAL BANKS-CASHIER'S BOND-LIABILITY OJ' SURETIES.
The sureties on a cashier's bond, reciting that B. had been elected cashIer of a bank to hold his office during the pleasure of the board of directors, are liable for any default occurring while he continues to act as cashier. Where a cashier's bond is given to the "National Bank of Sumter," the sureties are not released from liability for a default of the cashier because such default was permitted by the negligence and misconduct of the president and board of directors. A Judgtllent against a defaulting cashier for embezzlement of $5,500 in gold, taken by him from the vaults of the bank, does not estop the bank from bringing an action on his official bond to recover amounts subsequently discovered to have been appropriated by him by means of false entries and omissions to account for sums received by express. When the defalcations of a cashier exceed the amount of his bond, the bank need not credit on the bond sums collected from other sources, but may apply them in reduction of the unsecured balance.
S..urE-RELEASE-MISCONDUCT OF PRESIDENT AND DIRECTORS.
S..urlll-RES .ADJUDICATA-ATTACHMENT AGAINST OASHIER.
SAHE-CREDIT FOR SUMS OTHERWISE COLLECTED.
At Law. Action by John E. Phillips, receiver of the National Bank of Sumter, against Bossard and others, sureties upon the bond of C. E. Bartlett, formerly cashier of said bank. L. F. Youmana, Dist. Atty., and Mcme & Lee, for plaintiff. J. H. Earle, Atty. Gen., and Mr. Pardy, for defendants. SIMONTON, J., (charging jury.) The action is on the bond of one C. E. Bartlett, cashier, teller, and book-keeper of the Sumter National Bank; defendants being his sureties. It is not disputed that the Bank of Sumter was a national banking association; that Bartlett was duly appointed cashier, teller, and book-keeper; that ,he gave the bond stated in the complaint; and that defendants, with three other persons, were his8ureties. It is proved that plaintiff was duly appointed, upon the :f8ilure of the bank, its receiver, by the comptroller of the currency, and
that the latter authorized this suit. Notwithstanding the objection urged by the defendants that it has not been shown that the treasurer of the United States also concurred in this authorization of the suit, it is properly brought. The bond is in the penal sum of $10,000, and the condition of it is for the faithful performance of his duties as cashier, teller, and book-keeper, by Bartlett, his obedience to instructions, and his faithful accounting for all moneys coming into his hands as such cashier, etc. The complaint sets forth 31 breaches of the bond. They are in three classes. One class consisted of checks drawn by him on correspondent banks in various large sums of money, which it is alleged that he appropriated to his own use. Evidence has been submitted showing that, where he entered on the stub of the check-book the supposed amount of the check, he put a sum greatly below the real amount of the check, and posted the false amount in his ledger. Another class of defalcations charged was the receipt of money of the bank by express, and not accounting for it. The third was the carrying off, on the night of his flight from Sumter, a bag of gold containing $.5,500. You have heard the evidence on these points, and must say if they are proved. The defendants set up four defenses: First. That Bartlett was only elected for one year, that the bond was executed when he was first elected, and that their responsibility was ended when the year expired. The condition of the bond reci tes that Bartlett had been elected cashier, etc., to hold his office during the pleasure of the board of directors. There is no evidence showing that he was elected for one year, and none that he ever was dismissed or removed from office, or elected more than once. This defense cannotavail defendants. Second. 'fhat the willful negligence and misC\onduct of the president and board of directors permitted the fraudulent acts of Bartlett, and the sureties consequently are not liable therefor. Assuming that the validity of the bond at its execution is not disputed, no evidence to this effect having been shown, I charge you that this defense, even if it be fully made out, cannot avail the ants. The bond of Bartlett, signed by defendants, was given to the National Bank of Sumter, not to the president, nor to the board of directors. If he committed the defalcations and frauds charged, neither he nor his sureties can be excused because of any negligence or omission of duty on the part of the president or board of directors. They could not excuse, justify, or release them by a formal vote; a fortiori they cannot be held to excuse or palliate them· by conduct. Minor v. Bank, 1 Pet. 71 et seq. The bond was not given to secure the bank against such defalcations as Bartlett could make without the knowledge of, or such as were not within the means of discovery by, the president or directors; nor was the bond given upon the condition that the president or the board should watch him, and prevent any defalcation or fraud on his part. It was absolute in its terms, guarantying that he would faithfully perform his duties, and account for all funds coming into his hands, without reference to or respect for anyone else. Even if he acted with the fraudulent connivance of the president, or anyone or all of the board, this would only make them partners in crime, and still his sureties would
be responsible. The third defense grows out of the facts which I recall to you: Bartlett absconded on Saturday night. When the vault was opened on Monday it was discovered that $5,500 ingold was missing, which had been thereat the close of Saturday. At once attachment proceedings were begun, and certain of his property attached. The complaint was for his embezzlement of this sum as cashier, and judgment was had against him. The defendants contend that this suit and judgment estop the plaintiff. The attachment suit and this suit are not on the same cause of action. The first was on the embezzlement of a certain sum of money. This is on the breach of his official bond in not well and truly executing his duty as cashier, as well in that he did not faithfully account for money in his hands as for default in other transactions. When the attachment suit was brought, there was no knowledge l)f any other default than the theft of the $5,500; and the uncontradicted evidence is that the other defalcations were not suspected until Bartlett ran away, and were not known until some 10 days afterwards. This defense cannot avail, the defendants. Thefourth and last defense is this: The attachment suit realized about $1,000. The wife of Bartlett gave up to the bank an or-' der on Henry Clews & Co., of New York, signed in blank by Bartlett. This was filled out with the balance to his credit with these bankers, and realized $2,400 more. Defendants insist that they are entitled to credit on the bond for this amount. If you believe the testimony, Bartlett's default was between $65,000 and $70,000. Against this the bank held the bond for $10,000. They credited the sum recovered and the sum received on the surplus. Bartlett could give no direction as to the first; he gave none as to the last. There is no room here for the application of the doctrine of subrogation. The bond of these defendants was to:secure defaults to the extent of $10,000 only. If the defaults exceeded this, the bank had to look elsewhere. For securing the excess the bank could take all lawful means in its power. As the sureties had no responsibility for the excess, they had no interest in the means taken to secure it. For the $10,000 they were responsible. They are not entitled to any aid in paying it, except from such securities or collaterals, specially appropriated in the hands of the bank, or of any of the sureties, to meet it, and except also from recovery had on the bond itself. This defense cannot avail. If you find frOInthe evidence thatBartlett has made del fault in the amount charged, or in any sum exceeding the amount of the bond, and of the money recovered and received as stated, you will find for plaintiff the full amount of this bond.
(Circuit Court, No D.
E. D. May 29, 1888.)
GUARDIAN AND WARD-GUARDIAN'S BOND-BREACH.
Code Iowa, § 2l312, gives the circuit courts "original and exclusive jurisdic· Uon of the probate of wills, and the appointment of such executors." etc., and "of the settlement of the estates of deceased persons. and of the persons and estates of minors, insane persons. and others requiring guardianship." Hela, that to support an action against the sureties on a guardian's general bond, on the ground that he has converted the property of the estate to his own use and failed to account for it. it is not necessary to aver or prove that there has been a final settlement in the court which appointed him, nor that there has been any specific order whatever made by that court.
SAME-AcTION ON BOND-STAY PENDING SETTLEMENT.
If in an action on the bond brought in another court it appear that a full and final settlement should be had in the court where the guardian was appointed, in order to fully protect the interests of the guardian or sureties, the court may stay proceedings on the bond for a reasonable time to allow such settlement to be had.
SAME-ALLOWANCE OF CLAIM AGAINST GUARDIAN'S ESTATE-NoN-JOINDER OF SURE'l'IES.
Allegations in a petition on a guardian's bond, to the effect that after the conversion of the ward's I?roperty the guardian died, and his estate was ad· ministered upon by the court of a county other than that in which he was appointed guardian. and that the ward presented and the court allowed her claims against his estate, may be disregarded as surplusage. If the ward had a good cause of action for a breach of the guardian's duty, the fact that a court having no jurisdiction to bind his sureties because they were not parties adjudicated the claim arising from such breach. cannot affect the ward's right to recover against them on the original cause of action.
At Law. On demurrer to petition. Action by Mary Robb against Nicholas Perry, one of the sureties on the bond of E. G. Spencer, deceased, formerly plaintiff's guardian. P(JW('Jf'8 & La.cy, for plaintiff. Adama & Mathew8, for defendant. SHmAS, J. On the 13th day of March, 1873, E. G. Spencer was appointed guardian of the estate of Mary and Anna Robb, minor heirs of . James K. Robb, deceased, by the circuit court of Dubuque county, Iowa. He filed a bond with sureties in the sum of $4,000, conditioned for the faithful performance of his duties as guardian, and for a full compliance with all the requirements oOhe law in such cases provided. The presentaction is brought upon the bond, it being averred in the petition that the said Spencer received as guardian all the property belonging to his said wards; that he wrongfully converted the same to his own use; that he never made any report of his doings as guardian; that in 1884, said Spencer died, and that one George B. Smeallie was appointed administrator of his estate by the circuit court of Blackhawk county, Iowa, of which county Spencer was a resident at the time of his death; that said wards duly filed claims against said estate in said circuit court of Blackhawk county, which were heard and adjudicated on the 7th days of May, 1885 and 1886, it being adjudged that there was due plaintiff the sum