Harrisburg Savings & Loan Ass'n v. United States Fidelity & Guaranty Co.
Harrisburg Savings & Loan Ass'n v. United States Fidelity & Guaranty Co.
Opinion of the Court
Opinion by
This was an action of assumpsit brought to recover the penalty of a bend given by Enos A. Ferrin and the defendant as his surety to secure Ferrin’s “ honesty in the performance of his duties in the position ” of general manager of the plaintiff association. The bond is in the penal sum of $2,000 and is dated January 6, 1898. It covers the period from January 1, 1898, to January 1,1899. The condition of the bond is that the defendant “ shall, within three months next after notice, accompanied by satisfactory proof of a loss as hereinafter mentioned, has been given to the company, make good and reimburse to the employer (the plaintiff) all and any pecuniary loss sustained by the employer, of money, securities or other personal property in the possession of the employee (Ferrin), or for the possession of which he is responsible, by any act of fraud or dishonesty, on the part of said employee, in connection with the duties of the office or position hereinbefore referred to, and occurring during the continuance of this bond, or any renewal thereof, and discovered during the said continuance, or within six months thereafter, or within six mouths from the death, or dismissal, or retirement of the employee from the
The defense to the plaintiff’s claim interposed at the trial was (1) that notice of the default of the general manager was not given to the defendant within the time required in the conditions of the bond, and (2) that the duties of the general manager had been changed and enlarged subsequently to the defendant’s contract as surety, and that the loss sustained by the plaintiff did not occur while Ferrin was in the performance of his duties as general manager of the plaintiff association and is, therefore, not covered by the defendant’s bond. Both questions, arising under this defense, were submitted to the jury and found in favor of the plaintiff. The latter question is raised substantially by the various assignments of error, and is the only matter for consideration here.
On the trial in the court below the application for the bond, the bond itself, and the by-laws of the plaintiff association were placed in evidence. In his application to the defendant company, Ferrin was required to “ state fully the nature and duties of the position,” and in pursuance thereof he set forth in his application, inter alia, as follows: “ The duties of my
The subject of the first assignment of error is the admission
The second, third and fourth assignments of error relate to portions of the general charge in which the court submitted to the jury to determine whether the loss for which this action was brought was covered by the contract. It is contended by the appellant that the action of the court in submitting this question to the jury was erroneous, and that it was for the court, and not for the jury, to determine whether or not the plaintiff’s loss was secured by the defendant’s bond. The learned counsel for the appellant urges most strongly that the duties imposed upon the general manager were defined in section 7, article 2 of the by-laws, and that Ferrin had only such duties in the way of supervision and general management of the business of the corporation as were incident to that position, and that he had nothing to do with the financial operations of the corporation, and that all matters relating thereto were covered by the duties of the treasurer. It is claimed that the contract between the parties shows such to be his duties, and that it should have been so construed by the court, and the question as to his duties should not have been submitted to the jury.
We cannot agree with the contention of the learned counsel. It is true, as he suggests, that the liability of a surety is not to be extended by implication beyond the terms of his contract and that any material alteration therefrom may discharge the surety. Ferrin was appointed general manager of the association, and as such he gave the bond in suit to secure his employer against any fraud or dishonesty in the performance of the duties of his position. But what were those duties ? They were not specifically defined in the contract itself so that the court could, as a matter of law, ascertain and determine them. This became the duty of the jury under the evidence in the case. In the application on which the security was obtained, Ferrin was required to “ state fully the nature and duties of the position.” In complying with this requirement, he states that his duties are clearly set forth in section 7, article 2 of the by-laws, but he follows
It is contended, however, that under the by-laws all the financial operatio2is of the plaintiff association were to be transacted by the treasurer, and that upon him alone was devolved the duty of receiving and accounting for the money of the association. Under the evidence, it appears that the treasurer did receive some money direct from the parties from whom it was due, but-most of the money due the association was received by Ferrin, whose statements to the directors showed the amount received and that it was in the hands of the treasurer. But while such duties were imposed on the treasurer, it does not necessarily follow that the parties in their contract did not contemplate the temporary handling of the money by the general manager. As we have said, there was evidence amply sufficient to justify the jury in finding that such was their understanding. The issue in this controversy did not involve a determination of the duties of the treasurer, but only the right of Ferrin while discharging the duties of general manager to receive and account for the money of the association which he embezzled. This question was for the jury and its finding is conclusive of the fact.
The fifth assignment alleges error in the answer of the court to the defendant’s second point for charge. This point assumes as a fact that it was not the duty of Ferrin as general manager to handle the moneys of the plaintiff, and on this assumption, requests the court to say to the jury that the defendant was not responsible on its bond for the money received and embezzled by Ferrin. The practical effect of an affirmance of this point would have been to withdraw the case from the jury and for the court to have determined as a fact what, as we hold, was a question for the determination of the jury under all the evidence in the case. This would have been error.
The matter complained of in the sixth assignment was the refusal to affirm the defendant’s fourth point for charge. This point requested the court to charge that if the jury believe that the duties and responsibilities of Ferrin, as general manager,
The defendant by its eighth point, which is the subject of the last assignment, asks the court to give binding instructions to the jury to find for the defendant. Our conclusions in refer
The assignments of error are overruled and the judgment is affirmed.
Reference
- Full Case Name
- Harrisburg Savings and Loan Association v. United States Fidelity and Guaranty Company
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- Principal and surety—General manager of corporation—Province of court and, jury. In an action on a bond of suretyship of a general manager of a corporation given to secure his honesty in the performance of his duties as general manager, it appeared that by the by-laws of the corporation the general manager should have supervision of the affairs of the association under the direction of the board of directors and should “perform such duties in the detail work of the association as shall be prescribed from time to time by the board of directors.” The by-laws also provided as follows: “It shall be the duty of the treasurer to receive all moneys due the association, and to keep account of the same.” The application for the bond made to the surety company as general manager and approved by the president of the corporation stated that the position of the general manager was purely clerical, that itemized reports were made to the directors at each meeting of all cash received in the office, that moneys received in payment of dues were deposited in bank each day, that a complete system of credit slips was used, and that the books and vouchers were subject to the inspection of the directors at all times. The testimony showed that the general manager had charge of the books of the association, received the cash and deposited it in bank, that he produced at each meeting of the directors a statement which was accepted by the board, showing the amount of money received by him, and that it was in the treasurer’s hands. Meld, (1) that the testimony as to statements submitted to the board was properly admissible; (2) that the question as to whether the loss by the general manager’s dishonesty was covered by the contract, was for the jury and not for the court; (3) that the evidence justified the finding of the jury that it was the duty of the general manager, as understood by both parties to the contract, to receive the money, which, by his fraud and dishonesty, the plaintiff lost; (1) that a verdict and judgment for plaintiff should be sustained. Principal and surety—Discharge—Imposition of new duties. If moneys embezzled by a principal in a bond of suretyship are received by him under his appointment and in pursuance of his duties, the faithful performance of which are secured by the bond, the mere fact of the imposition upon him of other and greater duties and responsibilities, in no way interfering with or modifying those imposed by the original appointment, will not discharge the surety.