Watertown republican. [volume] (Watertown, Wis.) 1860-1906, 1893-01-18
INTEREST SUIT DECIDED.
Supreme Court Affirms the Decision OF
Judge Newman.


consideration, our conclusions upon the
whole case are, and the court
so holds, that the funds which
Treasurer McFetridge deposited
with banks were the property
of the state; that in making such de-
posits as treasurer and STIMULATING for
and receiving interest without such
stipulation, he did not violate any law
of the state; that such interest SO paid
to him being an accretion or increment
to the fund, increasing it by the amount
OF interest paid thereon, belongs to the
state; that Treasurer McFetridge re-
celved such interest by virtue of his of
ice of state treasurer, and the same
belonged to his sai@ Office; that his fail
ure to account the refor to the state, or
to deliver the same to his successor in
office as required by law, is breach of
the conditions of his official bond, and
that this action can be maintained on
such bond against him. and his sureties
therein, to recover the interest thus re-
ceived by him and unaccounted for.
"1n determining this case the court
has adopted many of the views of the
learned circuit judge, but withholds its
approval from others. Inasmuch
as we arrive at the same con-
clusion reached by him, although by
different processes of reasoning, 1t is
unnecessary to further discuss the prop
ositions IN his very able opinion,
which we are not prepared to adopt.
The judgement of the circuit court
must be affirm ed"
Thus announced Chief Justice Lyon
in the supreme court this morning, in
giving the decision of the court in the
case of the state of Wisconsin against E.
Z. Mctetrldge, ex-state treasurer, for
the recovery of interest on public funds
received by him. The decision is also
made to cover the cases against ex-
treasurer HarshaW, and judgment is
given for the amount called for in Judge
Nswman's decision, and interest. Con-
tinuing further the opinion, which is
approved by all the judges except Pin
ney, who did not sit in the case, is
briefly as follows.
The question whether the state is the
owner of the public funds in the hands of
the treasurer, or whether the legal title
thereto is IN the treasurer, must be de-
termlned by the statutes prescribing the
rights, duties and liabilities of the treas
urer. The statutes governing the treas
urer were all in force when. and for
long time before, the bond in suit was
executed. From beginning to end they
are entirely inconsistent with the theory
that the legislature intended, by the enact
ment OF any Of them, to vest the state
treasurer with the legal ownership OF the
public moneys Which come to his hands,
thus making him merely the debtor Of
the state IN respect thereto. If such were
his relations to the state, it would be diff
cult to show that such funds were not sub.
Ject to be seized for his debts or, in case of
the death Of the treasurer in office. that
the same would not go to his administra-
tor as part and parcel of his estate, the
state beng perhaps preferred creditor.
1t Is uncomfortable that any legislature
could intend such results. and there is
nothing III any statute which forces the
conclusion that they did SO. A close an
alySlS OF the above statutes. or any extend
ed discussion of them. is quite unnecessary,
Tor peruSal OF them is sufficient to carry
conviction to the mind that the legislature
never intended to diveSt the state of it's
title TO the public funds in the
hands of the treasurer. The de-
posts in the bank were made in
the name of the state treasurer, in his Of
nclal capacity as such. 10 time of credit
was given upon them. but they were pay
able whenever required by the treasurer,
and thek could only be drawn on the of
1iclaI draft or check of the treasurer.
They were made in accordance with the
usual and lOng-cOntinued course of buSi-
ness IN that department of the state GOV
eminent. They were not made primarily
Tor the purpose Of gain or profit TO the
treasurer, but because the exIgencies of
the business department. and the reason
able convenience of creditors of the state
rendered Il almost absolutely necessary
that state funds should be kept in different
portions OF the state and in the cities of
Chicago and New I DIRK, against which the
treasurer might draw. Such methods had
prevailed and deposits had been made in
banks and drawn againstby all the different
treaSurerS for thirty years or more before
the execution of the bonds in suit. A
large portion of the public funds were thus
kept on deposit during the whole period,
and dISbursed through the instrumental1-
W OF tens OF thousands, even hundreds Of
thousands, Of drafts or checks drawn by
the respective treaSurerS in the name Of
their Office against such deposits. To say
OF any adult citizen residing in the state
during any considerable portion of that
period, especially II he was a member of
the legislature, that he did not know OF
such course OF business would be an i'm
parchment OF his intelligence. Under these
circumstances 1t IS reasonable TO hold that
the state treasurerS were justified in trans
acting the business of their department as
they did transact it, and as such business
is almost invariably conducted in the COM
mercial world, unless those methods were
prohibited by some statutes of state
Is is claimed that the provision in Section
444S, Revised Statutes, making it prima
fac1e evidence Of embeZZl ement OF any
o1ncer or other person who, having the
care, custody or possession of the prop
erty of another, loans or deposits it for his
own gam, profit or advantage without
special authority, prohibits the treasurer
from making the deposits in question, in
aSmuch as he made them with the inten-
ton OF converting to his own use any in
tereSt the banks should thereafter
pay him on such deposits. To sub
ject a public officer to the serious
penalties Of the statute there must
be something III the character and Incl
dents OF The deposit to show that he has
disregarded the obligations of his trust
in making the same, or it cannot justly be
said that he has deposited the money for
his own gain. So long as his actions are
within the line of his duty he is not an
embezzler, although he may intend at some
future time to appropriate to his own use
the trust funds or some portion thereof or
the interest realized thereon. The de-
poSits were regularly made by the treas
urer in his official capacity as such for the
benefit Of the state, and could only be
drawn on his official draft. The authority
TO contract for interest on such deposits is
as broad as the right to make them for