Case Title: Western Bank v. Morrill

Citation: 246 Or. 88, 424 P.2d 243

Docket Number: 

State: oregon

Court: Oregon Supreme Court

Date: 1967-02-23T00:00:00Z

Document:
246 Or. 88 (1967)
424 P.2d 243
WESTERN BANK, Plaintiff, v. MORRILL ET AL, Defendants, and BOICE, Appellant, and SHAW LUMBER MILL ET AL, Respondents.

Supreme Court of Oregon.
Motion to clarify mandate filed January 9, 1967.
Allowed February 23, 1967.
*89 Frederic H. Starkweather, Jr., Gold Beach, for the motion.
Edward M. Murphy, Roseburg, contra.
Before PERRY, Chief Justice, and McALLISTER, SLOAN, O'CONNELL, GOODWIN, DENECKE and REDDING, Justices.
Respondents' motion to clarify mandate filed January 9, 1967.
MOTION ALLOWED.
REDDING, J. (Pro Tempore).
This matter results from an interpleader suit wherein the Western Bank paid a sum of money into *90 court and the trial court's decree settled the amounts due the respective claimants, one of whom initiated an appeal to this court. The trial court's decree and judgment was affirmed on November 16, 1966 (245 Or 47, 420 P2d 119). The mandate of this court, following the usual form, provided that the respondents recover from the appellant and her surety their costs and disbursements in this court in the amount of $176.55.
Counsel for the principal respondent sought and obtained an order from the trial court spreading the mandate upon the record. Said order provided for "* * * damages of interest at the rate of 6% per annum on the amount of $17,010.21 [the amount on deposit to which respondents were entitled] from and after the 3rd day of November 1965 [the date on which the judgment appealed from was entered], until paid." Upon appellant's objections to the allowance of interest provided for in the order entered, the trial court set aside said order to permit the respondent to bring the matter to this court for decision.
Appellant's undertaking on appeal was in the statutory form prescribed by ORS 19.040, which provides:
The bond filed on appeal herein was an appeal bond, not a supersedeas bond.
Pursuant to the judgment of the trial court of November 3, 1965, $2,500 of the fund on deposit with the court was distributed to the defendants Morrill, Tilley, Hansen and Boice. Upon entry of judgment in the trial court, respondents attempted to secure disbursal to them of the remaining $17,010.21 of said fund to which, under the judgment, they were entitled. Appellant Boice objected to the disbursal of any funds to respondents.
From the respondents' brief we learn:
[The quoted matter is from respondents' brief on the motion to clarify the mandate. The sources from which the quotations taken by respondents, having been returned to the trial court with the mandate, are unavailable.]
ORS 82.010 provides:
1. The language of the statute is broad and would appear to cover judgments which are appealed from as well as judgments not appealed from. The statute draws no distinctions as to accrual of interest upon judgments from which appeal is taken by way of cost bond which does not stay proceedings and cases where a supersedeas bond does stay proceedings, and the statute does not distinguish as to the kind of proceedings in which the judgment or decree is obtained. It would appear in its general language to authorize interest on judgments or decrees for the payment of money awarded in suits in interpleader.
As indicated above, appellant Boice asserted in the trial court that the filing of the statutory cost bond stayed the proceedings and that the damage portion of her cost bond would cover the item of interest accruing *93 pending appeal. The trial court entered its order on January 4, 1966, staying the proceeding.
2. While in the usual case, a cost bond without more, does not stay proceedings, (ORS 19.040 (1)) appellant Boice would appear to be correct in her assertion that the damage portions of the cost bond cover interest pending appeal.
Murfree, Official Bonds 277, 278, § 388 (1885) states:
See Mason v. Smith, 79 Tenn (11 Lea) 67 (1883); Spears v. Sherman, 148 Tenn 430, 256 SW 436 (1923).
And in 5 Am Jur 2d, Appeal and Error 472, § 1058 (1962), the following appears:
While the clear language of ORS 19.040 (1) (a) negates the idea that a cost bond not amounting to a supersedeas will stay proceedings, nevertheless, the trial court's order stayed the proceedings and deprived respondents of their distributive share of the fund deposited with the court.
Only two explanations for the trial court's action in the above regard appear to be plausible. First, appellant Boice asserted that her appeal stayed the proceedings. ORS 19.050 provides in part:
Without deciding whether subsection (a) of ORS 19.040 is here applicable, it would appear obvious that the trial judge determined that it was not applicable, for he stayed the proceedings without an undertaking as therein provided for. In any event, the court's ruling, if erroneous, was induced by representations of appellant, who assured the court that interest was covered by the appeal bond filed.
3. Without regard to the rules of law applicable to cases in which interest is sought upon an appeal bond filed in a suit in interpleader, the appellant should not be permitted to draw the court into framing an erroneous order staying proceedings upon assurance that the appeal bond would cover interest and subsequently *95 deny that it is bound by its representations. Appellants should be estopped to deny liability for interest on the appeal bond.
The second and most reasonable ground for the trial court's ruling may be found in subsection (c) of ORS 19.040, which provides that if the decree appealed from requires the transfer or delivery of any personal property, the proceedings will not be stayed unless the property is brought into court, or placed in the custody of such officer or receiver as the court may appoint, that the appellant will obey the decree of the appellate court.
The trial court may well have concluded that in cases of interpleader, where the property [the fund] is brought into court, the filing of a simple cost bond on appeal automatically stays the proceedings.
4. In any event, it is clear that whether the court, in reliance upon the representations of the appellant, was induced into erroneously staying the proceedings, or whether based upon ORS 19.040 (c) the court correctly concluded the proceedings were stayed, it is evident that such was the effect of the appellant's filing her cost bond wherein she undertook to pay damages and costs on appeal. As noted above, interest is an element of damages on appeal.
Though the bond here given was not in form a supersedeas, it had the effect, when coupled with the court's order staying proceedings, of precluding respondents from obtaining what the decree awarded them. The damage as a result is loss of interest.
The mandate of this court did not specifically award interest. However, the trial court, in framing its order, including interest at the statutory rate, acted in accordance with the holding in Wolfgang v. Thiele Co., 141 Or 280, 17 P2d 313 (1932).
*96 It would appear that unless, as appellant contends, the statutory language of ORS 82.010, providing for interest on judgments and decrees for the payment of money, does not apply to judgments in rem determining ownership of interpleaded funds, the statutory language should be given general application and interest should be allowed on the judgment herein as in ordinary cases.
5. In Oregon, judgments appealed from are considered final until reversed. Porter v. Small, 62 Or 574, 120 P 393, 124 P 649 (1912); Day v. Holland, 15 Or 464, 15 P 855 (1887).
Further, there is authority in this state (Porter v. Small, supra) which by inference at least indicates that the damage portion of a cost bond applies to in rem proceedings. The court intimated that where the res was a quantity of water, the value of loss of use thereof was calculable and a bond covering damages would cover such loss. Where the res in dispute is a fund of money, the statute fixes the measure of damages on appeal at interest at six percent where the rate is not otherwise fixed by contract.
Appellant contends that the statutory requirements of ORS 82.010, providing for interest on judgments and decrees for the payment of money, does not apply to judgments in rem determining ownership of interpleaded funds and relies on:
The conclusion of the Mississippi court in Gayden v. Kirk (1950) supra, is not persuasive and is contrary *97 to prior and subsequent decisions of the same court. In Sunflower Farms, Inc. v. McLean, 238 Miss 168, 117 S2d 808, 814, 816 (1960), the same court, without citation of Gayden v. Kirk, supra, held:
And in Aetna Ins. Co. v. Natchez Hotel Company, 160 Miss 818, 134 S. 582 (1931), the court on appeal allowed interest from the date of the original decree upon a sum in dispute which had been paid into court from the date the complaint was filed.
City of Barnsdall v. Curnutt, 201 Okla 508, 207 P2d 320, 323 (1949) is not in point. In that case, the fund held pending appeal was a sum allowed for attorney fees, and not an interest-bearing money judgment. Attorneys' fees are not recoverable as damages on an *98 appeal of supersedeas bond, 5 Am Jur 2d, Appeal and Error 472, § 1057 (1962). The case does quote with approval Franklin Bank v. Bruns, supra, which is distinguished in Stolar v. Turner, 238 Iowa 1168, 29 NW2d 417 (1947), which we later discuss.
Evancovich v. Schiller, supra, is not in point. The parties to the case disputing an interpleaded fund, had stipulated between themselves to the depositories' continued custody of the fund until a final determination of the issues.
The result of the above cases cited by appellant is stated to be the general rule in 15 ALR2d 473.
The case of Stolar v. Turner, supra, a well-reasoned case, however, is to the contrary and repudiates Franklin Bank v. Bruns. In Stolar v. Turner, supra, an insurance company deposited a sum of money in court and interpleaded several claimants thereto. Plaintiff Stolar obtained a decree and defendant appealed, filing a supersedeas bond staying the proceedings. On appeal, the decree was affirmed. The trial court then entered its decree upon the mandate and allowed interest at the statutory rate for judgments and decrees for money.
The defendant appealed, contending "* * * the [trial] court erred as a matter of law in allowing interest upon a fund held in the court's custody upon an order of interpleader." The court reasoned as follows:
The court held that interest on the money judgment was included under the term "damage" in the bond.
6. The court in Stolar v. Turner, supra, carefully and accurately reviews the Franklin Bank v. Bruns, supra, the strongest case for appellant's contention herein, and illustrates its fallacy, stating:
In other words, Franklin v. Bruns, supra, relied upon Van Gordon v. Ormsby Bros. & Co., supra, for the proposition now asserted by appellant.
In Van Gordon v. Ormsby Bros. & Co., the defendant prevailed in the trial court and plaintiffs appealed causing the fund in court to be held pending appeal. The cause was reversed and due to an error of the court, plaintiffs were not notified that they were entitled to the fund. Upon receiving notice, they petitioned for the fund, plus interest.
Van Gordon v. Ormsby Bros. & Co., supra, held only that plaintiffs who lost on trial and had appealed were not entitled to interest pending the appeal nor for the delay caused by an error of the court. This is so because the defendant was responsible neither for the delay pending appeal, for the plaintiff appealed, nor for the ministerial error of the court.
It appears then that the line of cases upon which appellant relies are based upon an erroneous construction of an early Iowa case and should not be followed by this court.
Stolar v. Turner, supra, is in accord with sound policy and should be given substantial weight by this court.
In this case, the distinction between a simple cost bond and a supersedeas bond should not be controlling. 4 Am Jur 2d, Appeal and Error 837, § 364. The important issue is whether appellant's appeal bond stayed proceedings, thus depriving respondents of the fund to which the lower court had held respondents entitled. The damage to respondents' loss of interest *101 pending appeal, results whether the appellant has promised to pay the judgment if affirmed, or has made no promise other than to pay damages and costs. Where the stay is procured at the instance of appellant, the result is the same.
Finally, both supersedeas bonds and simple cost bonds contain "damage" provisions and it is under that portion of the bond that interest is awarded.
7. We hold as a matter of law that the respondents are entitled to interest from the date of the original judgment.
Motion allowed.