Case ID: scl_20/html/0589-01.html
Source: Caselaw Access Project
Author: {"author": "Johnson, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

The South Carolina Insurance Company v. William Smith.
    
      Before Mr. Justice Bay, Charleston, October, 1834.
    Debt on bond. The defendant craved oyer of the bond, and on its being set out at length, it appeared that the defendant and others as his sureties, had jointly and severally acknowledged themselves to be bound to the President and Directors of the South Carolina Insurance Company and their successors in othce, m trust lor said company, m certain penal sums, conditioned for the faithful discharge of duty on the part of the defendant, as President of the said company, during his cont‘nuance ill office. The defendant in his first plea, avers that the plaintiffs ought not maintain their action, because are neither “ the President and Directors of the South Carolina Insurance Company,” nor their “ successors * m office.” The defendant’s second plea avers, that according tlle by? laws °f the company, the President is elected on a day therein fixed, for the term of one year, and until a successor elected, and enters on his office, and is required to give k°nc* an(i security for the discharge of his duty, during the said term; that he was elected President iti 1822, for the telm °f 01le year¡ atld gaVQ the bond in question, for the performance of his duties accordingly ; and that he did well and faithfully perform all the duties of his said office, during the said term, and until another election for President took ¶ pi&CC.
    
      A bond pnya-<feVt^eDirec-{?rsIof *£e So-Sdr successors ji1 ope, in trust pany,” will not ñamo1*” ‘he Company unless the ration contain ments!8 shewing were intended ^ im designated by inthebondiproT diet.) ' ’
    ocr'rvhose'tem of office was for one year, on his first election lécurity’for the discharge of his continuance®'in offico, and was liectedannuaHy f°rs°Iucoess1onS without giving //cZf°,ththat°tUe bond did not co-tíoíi"beyond' the first term.
    To ^ese P¡eas the plaintiffs demurred, and the defendant joined in demurrer.
    The presiding judge sustained the demurrer, and the defendant appealed, and moved to reverse his decision, on the following grounds:
    Because his Honor held, that the action was properly brought in the name of the South Carolina Insurance Company.
    2. Because his Honor held that-a bond given by the' defendant on his election to an annual office, was of force during his continuance in office under subsequent elections,
    
      King, for the motion,
    contended, that a bond given to a trus.-tee, cannot be sued on by the cestui que trust, and that therefore the first plea should have been sustained, and he referred to the act of incorporation, 3 Brev. Dig. 304; and cited 1 Chitty, PI. 3; 5 Barn. & Cresw. 355; 2 Day’s Con. Rep. 555-9; 6 Barn. & Cresw. 678; 2 Roll. Ab. 22 tit. Fait. F; Co. Inst. 673; 1 Hill Rep. 375. On the second ground he cited 2 Saund. 403 ; 6 E. 507 ; 5 B. & P. 175; 2 Bing. 32; 2 Maulé & Sel. 363; 2 Bar. & Aid. 431 ; 8 Mass. Rep. 275; 1 Eq. Rep. 275; 1 M’C. 41; Angel Corp. 176.
    
      Cross, contra,
    cited Ang. on Corp. 55 ; 6 Sergt. & Rawle 12; lKyd on Corp. 287-; 10 Mass. Rep. 360; 13 John. Rep. 38; 7 Mass. Rep. 441; 5 lb. 80, 401; 10 lb. 336; Dyer, 150 ; 11 Mass. Rep. 338 ; Prec. in Chan. 309.
   Johnson, J.

The bond set out in the pleadings is made payable to the President and Directors of the South Carolina Insurance Company, and the averment in the defendant’s first plea is, that the company or corporation thus designated are not the plaintiffs. This averment is admitted by the demurrer, and it follows necessarily that the demurrer ought not to have been sustained; I am not, however, to be understood as ad. vanciner the opinion that the plaintiffs could not have mam-tamed an action on this bond; on the contrary, 1 am disposed to think that if there had been suitable averments in the declaration, shovying that the plaintiffs were intended to be designated by the description in the bond, or if, instead of demurring, the plaintiff had replied that fact, the action might have been supported. But it is unnecessary to decide this question as the motion of the defendant must succeed on the second ground, which is decisive of the case.

That the bond given by the defendant did not cover his defalcation beyond the term for which he had been elected, is a proposition which is not now debateable. The principle was very clearly settled in the case of The Commissioners of Public Accounts v. Greenwood, 1 Eq. Rep. 450, where one Boquet, having been elected State Treasurer for one year, gave a bond for the faithful discharge of the duties of the office, and was subsequently re-elected and continued in the- office, without giving any other bond. In an action on the bond against the defendants, his sureties, for a defalcation subsequent to the period for which he was first elected, it was held that they were not liable. And still more precisely analogous is the case of The South Carolina Society v. Johnson, 1 M’Cord, 41. According to the bye-laws of the Society, the treasurer was to be elected annually, and Trezevant having been elected to fill a vacancy occasioned by the death of the incumbent, Johnson, the defendant, became his surety. He was afterwards elected to the same office for several years in succession. On the investigation.of his accounts, it was found that he was a defaulter at a period subsequent to the expiration» of the time for which he was first elected, and it was held that the defendant was not liable.

The defendant in his second plea avers, that during the period for which he was first elected, he discharged all the duties imposed on him by the condition of the bond, and this fact is admitted by the demurrer; he was not therefore liable on the bond.

It is therefore ordered, that the judgement of the Circuit Court be set aside, and that judgement for the defendant be entered on the demurrer.

O’Neall and Harper, Js. concurred.