8089

#### STATE v. DETYENS.

The sureties op a county treasurer are liable for commutation tax received by him for work on the .public highways and not paid out according to law, although he received the money after the date fixed by statute for its payment.

Before Gary, J., Georgetown, April, 1911.

Affirmed.

Action by 'the State of South Carolina against Jantes F. Detyens and1 American Bonding Company of Baltimore. The bonding company appeals from the following order sustaining a demurrer to its: answer :

“This action was brought by the State against James F. Detyens as principal, and the American Bonding Company of Baltimore as surety, on the official bond of Detyens as county treasurer of Georgetown county.

“It- is alleged- -in the complaint and specifically admitted in the answer of the American Bonding Company that Det-yens, as county treasurer, collected -certain moneys as ‘taxes imposed upon persons -engaged in gathering -oysters, catdb-img fish, etc., which tax is provided for under the act of 1906, and that the money so collected was not turned over to Detyeni’s successor in -office. The bonding company sets up a ■ defense for failure of its principal in this respect that the fish stamps were left in the treasurer’s office by the predecessor of Detyens, and were never receipted for by the said! Detyens as county treasurer or -so- as to' render his official- bond responsible-therefor. The State interposed a demurrer.to this defense,upon.1the.ground that the- allegations contained therein fail to' constitute a defense.

“I am of tíre opinion that tíre demurrer in this respect should be sustained for the reason that the tax imposed by the act of 1906, commonly -known -as thie fish stamp tax, has been paid by the individuáis and' collected by the treasurer as a tax upon fish taken' in the public waiters of the State, *341and such -tax is a part of .‘the public revenue. The fact that Detyens did not receipt for the unsold stamps on hand 'when he took charge of the office cannot affect the case. He actually received them; his answer so specifically admits, and sold them to persons liable for the 'tax, and having failed to account for the money so 'collected, his surety is liable to the public therefor.

“As a further defense to the cause of action set up by the plaintiff, the defendant American' Bonding Company alleges in- the fourth and fifth paragraph's1 of its 'answer that included in thie amount of the admitted1 shortage aré items erroneously charged against the said1 county treasurer for commutation of road duty collected by the treasurer after the expiration of the time during which by law he was entitled to collect the same; that the treasurer had no authority to receive the same, and that it, as surety upon the bond, cannot be held' liable therefor. The plaintiff demurs to the defenses set up in these paragraphs of the answer upon the ground that they fail to state facts sufficient to constitute a defense.' Defendant contends' that the law did not require or allow the collection of the highway tax at the time of the actual collection thereof, and that having- been collected under such 'circumstances no liability rested upon it as surety to account; 'that if there is any liability whatsoever' -it rests upon James F. Detyens as a personal and private obligation and not as an official trust. To sustain this view, defendant relies upon die case of the *State*v. White, 10' Richardson Daw 442, and *Bttiott*v. *Jeter,*59 S. C. 4S3. An examination of the White case will show that the money for which the surety of the ordinary was sought to be held was. neither taxes: nor public revenues of any kind, nor was- it money received by thie ordinary *colore officit.*The Court said the only, way he could receive it was as a mere personal trust, for which he alone was responsible. In the Jeter case neither tax nor public revenue was involved; the liability was to individual's *342for personal funds. In, that case 'the Court be-ld that if the probate judge had na juri-s'dictioni to partition realty, any funds coming into his 'hands' from a partition sale ooiuldl not create a liability under his official bond The defendant cited cases from other States which seem to be more nearly in accord with its contention, but the great weight of authority is to the contrary. In the case of *Town of Powlet*v. *Kelly,*69 Vt. 401, it is said: Tt is no defense herein that the selectmen included the unpaid highway tax for 1891 and 1892 in the tax 'bill for 1893. If the taxpayer paid Kelly the amount of the tax, the money became the money of the town, and the surety liable if the collector did not pay it over. If the tax levy was invalid, it was no defense as to the nonpayment of the moneys in fact collected’

“In *Puller*v. Calkins, 22 Iowa 305, it is said: ‘The substance of the whole matter, however, is that, though the collector may not have been legally bound to1 receive this money at the time, yet he did receive it, and, as we are bound to presume, executed the usual and proper receipts, and entered the proper memorandum on the tax list at the time, or so soon as the same was placed in hiis¡ handlsi. 'By so doing* be was in no just sense the mere custodian or trustee of the taxpayers, holding the funds for their use and alone liable to them, or individually to. the government, for the faithful application of the funds. This was public money, funds* in his hands by virtue of his office, revenue which be was bound to account for and pay 'over; and, by the very terms of the bond, tíre sureties were liable therefor. As was said in *Warren County*v. *Ward*(21 Iowa-, 84) the officer was perhaps not bound to t-ahe the money, -but he *did,*accepting is as collector, and he is therefore bound for it a® money received by virtue of his office.’

“In the monographic note to the case of *Feller*v. *Gates,*91 Am. St. Rep. 558, it -is said: ‘Where, however, money is received by- a treasurer as public funds-, and in his capacity as treasurer, he or his sureties cannot, by the weight of *343authority, attack 'tibie validity of the mean© by which it was raised, in order to turn his official trust into a private one, or make ¡bis appropriation of such money am extra official delinquency, and, therefore, not a breach of his official bond. Thus, where money is borrowed) or raised by taxation, and paid into the treasury, it is no defense that the 'board which raised the money, ini so doing', 'exceeded its1 'lawful- authority. As is said in *Cheboygan Co.*v. *Brratt,*110 Mich. 156, 67 N. W. 1117: ‘We think it altogether 'dear that, when' it is shown that moneys have actually come into the hand's of the treasurer as treasurer, neither be nior his bondsmen can avoid liability by showing that either irregularities exist in the proceedings by which such moneys were1 collected, or that 'there was no .authority to enter into the agreement which resulted in1 the receipt of the money by -the county. It is enough to impose upon the treasurer an active duty that the count)'' has received the money, and the obligation on the bond -exists when the money finds its way into bis hands as treasurer.’ So it is no defense for failure to pay over or account, for money paid into- the treasury -as taxes, that -they were collected without warrant: *Berrien Co.*v. Bunbury, 45 Mich. 79, 7 N. W. 704; or that the levy was irregular: *Mahaska Co.*v. Ingalls, 14 Iowa 170.’ * * * In the cases above considered, and by the authorities generally, no distinction is- made between a treasurer anldl his sureties, so far as concerns the right of either to questions the legality of 'the means by which money paid to and received by him as treasurer was raised. 'And in this case, page 5'54, a number of authorities are cited as sustaining the rule that sureties are even liable for taxes collected under an unconstitutional statute.

“It is admitted that the highway tax was' collected by Detyens, as county treasurer, and' no excuse for failure to turn it over to his successor is given other than that it was paid subsequent to the time fixed by ‘Statute. The State requires certain citizens to perform manual labor upon the *344publ'i'c highways each year, but grants to 'each the privilege of commuting such 'service by the payment of a fixed! amount of money before the first day of March; .The payment oif money within the tíme prescribed is a privilege granted) the citizen, of which he may aivaiMi 'himself or not in accord'a-mct; with his desire, but if he fails' to pay within the required time, he cannot 'complain upon 'being required -to labor upon ■the highway for the stipulated number of days. On the other hand,, if 'the treasurer permits the payment, and in fact receives the tax after the expiration of the prescribed' time, the citizen being thereby relieved of performing thie labor, the money so collected -is a public .revenue, and is received by the county treasurer by virtue of his office. This, at most, was a mere irregularity in the collection thereof, which should not, according to am unbroken line of authorities, excuse the treasurer from tunning- it over to his successor, and could not relieve the surety from liability therefor. -The various persons liable toi perform road duty have only tardily paid the tax, and the treasurer having elected to receive it, neither he noir the sureties will now be heard to say 'that it was- irregularly or improperly collected'. Having* been 'thus intrusted with this fund by virtue of’his office, it was the duty of Detyens to turn it over to his successor, as provided by section 69'5, Code oif Daws, 1902, volume I. The demurrer to the fourth and fifth paragraphs of the answer must, therefore, be sustained.”

The defendant appeals on the following exceptions:

First: “Because the Circuit Judge erred in sustaining the demurrer to the defense set up in the sixth paragraph of the answer of the defendant, the American Bonding Company of Baltimore, the error assigned being that it was alleged in said paragraph and, admitted' by the demurrer that the said Detyens, county treasurer, never receipted' tor, n'or did1 he ' assume any responsibility whatever for the fish stamps therein mentioned, and his surety was' never in law responsible to the State or the county 'for said fish stamps.

*345Second: “Because the Circuit Judge erred in sustaining the demurrer to the defense set up in the seventh paragraph of the defendant's answer, the error assigned being that the amount therein mentioned as. Charged against the counity treasurer as moneys received by him in commutation of road duty was alleged in1 the answer and admitted 'by the demurrer to have been received by the county treasurer after the expirationi of the time during which by law he was entitled to collect the same, and the surety was therefore not responsible for hi® failure to pay over the same.

Third: “Because the Circuit Judge erred ini sustaining the demurrer to the defense -set up in the 'eighth paragraph1 of the defendant’s answer, the error assigned being that the answer having alleged that the said county treasurer received, the amounts stated in ©aid paragraph in commutation of road duty after the expiration of the time when he was by law authorized to collect the same, -and that the surety was therefore not responsible for bis failure to pay over the same.

Fourth: “Because the Circuit Judge 'erred: in not holding that if there was any liability resting upon the county treas^-urer because of the .collection of the commutation of road duty-, the same created simply a personal liability on the part of the county treasurer, and was not -a liability for which his bondsman would be responsible.”

*Messrs. Mordecai &*Gadsden, *Rutledge & Hagood,*for appellant,

cite: *The surety is not responsible for money which the treasurer had no authority to collect:*10 Rich'. L. 442; 59 S. C. 483; 11 Mo. 447; 36 Fed. R. 172; 65 Cal. 358; 16 Brad. 612; 156 Ill. 499; 38 N. J. Eq. 586; 60 N. Y. 421; 8 La. Ann. 95; 17 N. Y. 242 ; 36 Fed. 172; 41 Pac. 445; 91 Am. St. R. 558; 7 N. W. 704;' 14 la. 170.

*Attorney General J. Praser*Lyon, contra,

cites: *Both surety and principal, are liable for .public revenues collected:*69 Vt. 401; 22 la. 305; 91 Am.. St. R. &58.

*346January 18, 1912.

Per Curiam.

This appeal is from an order sustaining1 demurrer to1 the fourth and fifth paragraphs of the answer, which order is herewith! reported; with exceptions thereto.

After due cooisidenationj we are satisfied that the excep'-tionis should be overruled for the relas'oinls stated ini the order.

Judgment affirmed.