Case ID: idaho_34/html/0020-01.html
Source: Caselaw Access Project
Author: {"author": "BUDGE, J. —", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

(May 27, 1921.)
    MURPHY MERCANTILE COMPANY, a Corporation, Respondent, v. UNITED STATES FIDELITY & GUARANTY COMPANY, a Corporation, Appellant.
    [198 Pac. 670.]
    Evidence — Surety Bond — Construction of.
    
      Held, that the evidence in this ease is sufficient to support the judgment, that the court did not err in its construction of the bond, and correctly applied the law to the facts of this ease.
    APPEAL from the District Court of the Third Judicial District, for Ada County. Hon. Chas. P. McCarthy, Judge.
    Action on surety bond. Judgment for plaintiff.
    
      Affirmed.
    
    Earl Paine, for Appellant.
    In order to create a liability on the part of the insurer, the loss must be one which is covered by the terms of the policy, fairly construed. A loss resulting from the employee’s carelessness or inattention to business or other acts or omissions not fraudulent or dishonest imposes no liability on the insurer. (19 Cyc. 518.)
    
      The contract does not cover every act or omission involving disobedience of instructions or violation of duty. (Kansas Flour Mills Co. v. American Surety Co. of New York, 98 Kan. 618, 158 Pac. 1118,- Monongahela Coal Go. v. Fidelity and Deposit Co., 94 Fed. 732, 36 C. C. A. 444.)
    Davidson & Davison, for Respondent.
    A bond made by a surety company, insuring against fraud or dishonesty of an employee of insured, if susceptible of two constructions, will be given the construction most favorable to insured, where it was drawn by the agents of the surety company. (American Surety Co. v. Pauly, 170 U. S. 133, 18 Sup. Ct. 552, 42 L. ed. 977; First Nat. Bank of Kansas City v. Hartford Fire Ins. Co., 95 U. S. 673, 24 L. ed. 563, see, also, Rose’s U. S. Notes; Champion Ice Mfg. & Cold Storage Co. v. American Bonding & Trust Co., 115 Ky. 863, 103 Am. St. 356, 75 S. W. 197; 19 Cyc. 517.)
    Liability on the fidelity bond insuring an employer against loss through the “fraud or dishonesty” of an employee, is not limited to such losses as result from criminal actions as embezzlement or larceny, but such words have a broader meaning and include any acts which show want of integrity or a breach of trust. (United States Fidelity & Guaranty Co. v. Egg Shippers’ Strawboard & Filler Co., 148 Fed. 353, 78 C. C. A. 345; City Trust etc. Co. v. Lee, 204 111. 69, 68 N. E. 485; 19 Cyc. 518.)
   BUDGE, J. —

This action was brought by respondent to recover $1,459.69 from appellant as surety upon a bond to reimburse the former for any pecuniary loss sustained by reason of the fraud or dishonesty of its employees. The cause was tried before the court without a jury, and from a judgment in favor of respondent in the sum of $1,124.14, this appeal is taken.

From an examination of the record and the authorities, we have reached the conclusion that the evidence is sufficient to support the judgment, that the court did not err in its construction of the bond (United States Fidelity & G. Co. v. Egg Shippers’ S. & Filler Co., 148 Fed. 353, 78 C. C. A. 345), and correctly applied the law to the facts of this case. No reversible error appearing in the record, the judgment of the trial court is affirmed, and it is so ordered. Costs are awarded to respondent.

Rice, C. J., and Dunn and Lee, JJ., concur.

McCarthy, J., disqualified.