Board of Education v. . Fonda ( 1879 )

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[EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.]

[EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] The writing upon which this action is brought is not a bond. It is in the fashion of one. It has a penalty and condition. It recites that it is under the hands and seals of the obligors. Yet there are no seals to it. There are places for them; and the letters L.S. to each name, which mark those places but do nothing more. It is not an instrument in strict compliance with the statute: (Act of 1864, chap. 565, p. 1273, § 7.) When the Legislature said a bond, it meant a bond; which is a form of taking security well known to the law; from its characteristics having some sanctions not shared in by all written obligations, and thereby affording a more complete and binding, and higher form of security. The members of the corporate body which is the plaintiff here are not to be excused of carelessness. Still, this is not to say that the writing is invalid and not enforceable. A writing is good at common law, binding upon the makers, where it is neither malum in se nor malum prohibitum, is founded on a good consideration, is given and taken by competent parties, and is willingly made. Though the Legislature spoke of a bond, it was as a means to the lawful end of having security for the school moneys. Therefore, whatever reaches the end is not against natural or moral law, or public policy. Hence this writing is notmalum in se. Though the statute points out a bond as the form of security, it points too to the duty of giving and taking security. There are not negative words in it. It does not forbid this writing. Neither expressly nor by implication does it make it void. Though it was the duty of the plaintiff to follow the statute law and take a bond, and nothing but a bond; yet it is not against the policy of the statute that security should be taken in other form. To hold otherwise would oft defeat the object of the statutory requirement. It need not be held so, unless the statute forbids such an act to be done. Thus it is not malum prohibitum. It had a good consideration. Wolcott had been duly appointed to office. An obligation in writing, with sureties, that he would do well his part in office, was asked from him; as it lawfully might and must be, without which he could not enjoy the office. The giving of the writing for the sake of getting the office was giving it for a good consideration. It was willingly made by him and by the defendants; willingly delivered to the plaintiff, the party for whose benefit it was meant. The defendants were competent to make and deliver it. The plaintiff was competent to take it. They were enjoined by the statute to take security. By accident or mistake, wholly without ill design, they have taken a writing in the form of a bond, but have not put seals to it. The supreme political power, acting through its officers, is competent to take as security for official good conduct an obligation in writing not squaring with the literal requirement of the authorizing statute: (The United States v. Linn, 15 Peters, 290; The Same v.Hodson, 10 Wall., 395.) The executive officer of a county has been held to be so; (Morse v. Hodsden, 5 Mass., 318); and a judicial officer of a county; (Thomas v. White, 12 id., 369); and the directors of a bank (Bank of Brighton v. Smith, 5 Allen, 415). We see no reason why the plaintiff is not competent to take such a writing, when it is done in good faith and in aid of the policy of the statute creating it, and the plaintiff is the body empowered and directed to take security.

It is said, however, that the giving of a bond was a prerequisite to the holding of the office by Wolcott; that he could not enter upon the duties of the office until the bond was given; and that if he failed to give the bond within ten days, the office became vacant. This provision, in substance, is not uncommon. Yet, when persons come into office by color of title, they are officers de facto. Their acts are valid when they concern the public or the rights of third persons who have an interest in the act done. The limitation to the rule is as to such acts as are arbitrary or voluntary, and do not affect public utility: (The People v. Collins, 7 J.R., 549.) In the case cited, the provision of statute was; that if the officers should refuse to serve, others might be chosen or appointed; that they should, before they entered on the office, and within fifteen days after election or appointment, take the oath of office; and that neglect to take the oath should be deemed a refusal to serve. This is a provision not exact in tenor, but like in effect, with that before us. Yet it was held that the acts of those coming in colore officii were good, though they had not done that which the statute commanded, and with a penalty; the same as that here, the loss of the office. The reasoning upon this subject is well done in 5 Allen (supra); and to that we refer, if more elaborate statement is looked for. The case in 38 Maine, 586, cited for defendants, is to be distinguished from that in hand. There, it did not appear that there was any attempt to observe the statute, before doing the act; besides it seems to conflict with out own adjudication; (7 J.R., 549 [supra]); and later decisions in that State do not seem adverse to our views: (Boothbay v. Giles,68 Maine, 160.) In the case cited from 39 N.Y., 196, there was no color of right, until the act should be done which was omitted.

These considerations seem to dispose of the first and second points made for the defendants. Most of the money which Wolcott ought to have paid came from the tax for a new school-house; not all of it. He was district treasurer the year before. At the close of it, there were thirty-six dollars of district money which he had not paid out. This sum was put into the judgment against the defendants. It is now claimed that they were not liable for it, inasmuch as it came to his care before they became his sureties. Their undertaking is dated the 3d of November, 1875, and is found to have been executed on that day, by which it is meant that it was then signed and sealed. It was taken by the plaintiff the twelfth of that month. The fifth finding is that this sum was had by Wolcott on the first day of that month, before the defendants became sureties, and remained in his hands on and after the third. The seventh finding is that it was the eleventh of that month. The testimony is that it was the first. The points for plaintiff concede that it had come to Wolcott's hands at the close of his former term as treasurer. It is to be noticed that the finding is, that that sum remained in Wolcott's hands on and after the third of the month. The language of this finding is that appearing in the adjudged cases. It is not claimed by the defendants that Wolcott had appropriated it to his own use, and was actually a defaulter thereof to the plaintiff before they made their undertaking. It does not appear but that up to the time of the last call for the money, he was able to and did meet his official obligations at once. It is probable that the very moneys which made up this sum were not kept apart by him, but mingled with others, from the mass of which he made payments to the plaintiff when asked. When it was called for at last, he was not able to pay it. The question is up then, whether sureties for the second term of an official having the care of public moneys, are liable for what he took in during his first term, remaining in his hands until after they have given their bond, and which he failed to pay during his second term. We find a rule laid down thus: For any sum paid to a principal before the execution of a bond for official good conduct there is but one ground on which the sureties can be held to answer, and that is, that the principal still held the money in bank or otherwise. If still in his hands, he was up to that time bailee to the public; but if he had become a debtor or defaulter thereto, his offence was already consummated. (Farrar v. United States, 5 Peters, 372.) It was said there, that if it was meant to cover past deeds, the bond should have been made retrospective; and that the sureties had not undertaken against his past misconduct. The bond was there, as the undertaking is here, prospective in its language. The other face of this rule is shown in United States v. Boyd (15 Peters, 187), thus: That if the sum, though taken by the principal before the giving of the bond, was held by him after his appointment in trust for the public, and so continued to be held at and after the date of the bond, then the failure to pay and account therefor, after the giving of the bond, was a breach of the condition thereof. (See, also, United States v.Eckford's Ex'rs, 1 How. [U.S.], 250-261.) The finding, and, so far as the testimony goes, the proof, show that Wolcott held the sum after his second appointment and after the defendants gave their undertaking. They did not offer to prove a use of it by him before that for his own purpose, and a defalcation by him therefor. We therefore say that the point is not good.

As Wolcott was treasurer, he was the fit and only keeper of the moneys raised for school purposes. (Laws of 1864, chap. 555, tit. 9, p. 1273, § 7.) As we have said, most of the money of the plaintiff which he had was raised by tax to pay off a bond made by the plaintiff under chapter 24 of the Laws of 1872. That act gave the plaintiff power to put up a building for "educational purposes," and to buy a fit site and grounds therefor, and to raise money therefor by bonds. Power was also given to raise by tax money to pay the bonds. These powers had been used before the naming of Wolcott as treasurer, so far as to put out the bonds and receive the price thereof. The power to tax for money to take them up was used in 1875, before his last appointment as treasurer, and the most of the money in his hands came from that levy, but was received by him in his term of office covered by the suretyship of the defendants. It is now urged that the act of 1872 did not add to the duties of the treasurer of the plaintiff. It did not; that is, it did not put upon that officer another kind of duty than those he was under before. It made his duty of keeping the money for school purposes greater, as it for a time enlarged the sum to be kept therefor. The act of 1872 does not in terms say that the money raised by tax shall be paid to the treasurer. It was raised to be paid in the end to the bondholder. Still, it is plain that money to be raised by tax in a rural school district must be got in driblets. Meanwhile it cannot be paid to the bondholder by piece-meal. Until there is got together enough to pay a bond, the money, as it is taken from the taxpayer, must be kept somewhere by somebody; and who but the treasurer is that one? He is the treasurer, the official man who is to have charge of the moneys raised within the district for school purposes: (Act of 1864, p. 1273, § 7.) Buying a site for, and building a school house, was a school purpose, within the meaning of the act and section just cited; though the exact meaning of the word "purpose" may not take in that notion. A purpose is that which one sets before himself to strive for and reach. It is the end rather than the means thereto. So the purpose of a school, the end of setting it up, is strictly the mental training and finish of the scholars; and the school-house is but a means to that end. But the word in the plural, purposes, is sometimes of the same sense as the word uses. "The meaning of words depends upon the subject," per Lord MANSFIELD: (Lyers v.Bridge, Doug., 530.) This is much so in this statute of 1864. This word is sprinkled over it, and mostly in this sense. Section 12 of title 7, page 1242 says that certain persons owning or hiring property subject to taxation for school purposes may vote at a school meeting. Plainly the end of this section is that only the taxpayer, near or far off, may be the tax-voter. Now what are among the things which may be voted upon? To pick out a site for a school-house. And what among the taxes? To buy such site, and build a school-house and keep it in repair: (§ 15, p. 1243.) Clearly then the building of a school-house is among the school purposes looked forward to by this act; and money raised therefor, in any lawful way, is raised for one of those school purposes, and the treasurer of the district is the treasurer thereof. It is said that an official undertaking is to be construed, and the liability of sureties found out, by going to the statutes making him the keeper of the public moneys; and so it is laid down: (The People v. Pennock,60 N Y, 421.) Then it is urged that the act of 1872 (supra), is a private act, and that the defendants may not be taken to have bargained in reference to that of which they knew not nor heard, until this trial. If the act of 1872 is a private act, that does not make it any less the basis of liability. It put a greater duty upon the treasurer. The defendants, when they became his sureties, were so for the doing by him of all that the law cast upon him. In the case just above cited the money was in the hands of the official principal, not only without statute, but against statute, which said that it should have gone to other officers. It is what the law asks of the official principal, that the sureties for him undertake that he will do, whether that law speaks in a public or a private statute, when those statutes go before the making of their obligation.

It is further said that the plaintiff, the corporate body, had no power, apart from that given by the act of 1872, to buy a site and put up a school-house. Let it be granted. The plaintiff, as a corporate body, after all is but the district. It is the school district, acting as a political being through its agent, the board of education. The powers given to the board by statute are given for the good (or ill, as it may turn out) of the mass of people who make up the union school district. The action of the plaintiff, as such body corporate, was the action of the district, and bound all having stake in the matter, be they simple ones of the whole, or officers, or sureties for officers.

It is urged that the passing of the draft to the Safe Deposit Company, in payment of the bond of the plaintiff, was a suspension of any other remedy against Wolcott, and thereby discharged the sureties. There is wrapped up in this proposition a matter of fact. Was the draft passed to the company in payment of the bond? The learned referee has not so found. He states in his report that it was not received in payment, but as a means of obtaining it. Though this is mingled with the conclusions of law, it might have been uttered as a finding of fact and been upheld by the testimony. It is a clear inference from what took place between the plaintiff's agents and the agent of Wolcott, that the draft was looked upon as good to be paid, yet that it was not their purpose that it should be taken in the stead of money, but as the means of getting the money. In the absence of agreement or express understanding that such an instrument shall be taken in satisfaction, it does not in law have that effect. One simple executory contract taken for another, for the same consideration, from the same party, does not put out the latter: (Gregory v.Thomas, 20 Wend., 17, and cases there cited.) Paper is no payment when there is a precedent debt: (Ward v. Evans, 2 Ld. Raym., 928.) Taking it as now yielded, that the plaintiff had a contract from Wolcott, or a prior debt against him, the giving of this draft did not supplant it. Had there been funds to meet it in the hands of the drawee, it would have been held an agreement for delay until day of payment; and money had upon it, orlaches by the plaintiff, would have worked to the relief of the defendants. As there were not enough funds there to meet it, and acceptance and payment were refused, it did not so work, so far as we have now got. When the draft reached the Safe Deposit Company it had been added to. Barstow, the payee named in it, had put his name on the back, indorsing it to Storms; and he had done the same, indorsing it to the company. Calling the draft, as thus added to, the paper of other parties, yet as the debt of the plaintiff was precedent, there was need of express agreement to make the taking of it payment of the plaintiff's bond: (Porter v. Talcott, 1 Cow., 359; Monroe v. Hoff, 5 Denio, 362;Hill v. Beebe, 3 Kern., 356.) No express agreement to that end is proven; and all the inferences from the facts shown are against the making of one. The taking of the draft as a means of getting payment of the debt, and the unavailing use of it for that purpose without laches worked no suspension of remedy against Wolcott that will discharge the defendants, if they are his sureties. Besides, the answer does not set up that defense. And again, one of the defendants was consenting to and assisting in the use of the draft. This point arises either on a motion for a nonsuit made by the defendants jointly or an exception in behalf of the defendants jointly to finding and conclusion. It is not taken for the one not knowing to the giving of the draft, nor is any motion or request made for him, singly. For these reasons we hold that this point is not tenable. And this also meets the contention, that the draft having been indorsed to the company, there went with it a right of action upon the original consideration. When the draft came back unpaid, the plaintiff gave back the bond to the company, and the word "paid" written upon it was marked out, and only the amount in fact paid was put upon it. The plaintiff then had the ownership of the draft and was entitled to the possession of it. The company did not own it, and could not have kept it from the plaintiff. The possession of it by the former was but the custody of it for the latter. The plaintiff had all rights of action growing out of the transaction between it and Wolcott.

This is approved as declaring the law of this case, and the judgment appealed from will be affirmed.

All concur.

Judgment affirmed.