Court Opinion

ID: 5561729
Source: CourtListenerOpinion
Date Created: 2022-01-11 00:51:55.437419+00
Date Added: 2024-06-11T08:35:29.651376
License: Public Domain

Blandford, Justice.
This was an action brought on the bond of the treasurer of this state to recover of the treasurer and his sureties certain sums of money, which it is alleged had been received by and paid to him and others for the use of certain moneys of the state, deposited by him in certain banks. To this declaration defendants demurred, because it set forth no cause of action against them. The declaration was amended by adding a further breach of the bond as to penalties incurred by the treasurer. The declaration, as amended, was then demurred to. The court overruled the demurrer, and defendants excepted, and bring the case here for review.
In order to ascertain whether there is any liability of the plaintiffs in error upon the bond, under the allegations in the'declaration, it will be necessary to determine wha't was the law of this state, in 1877, when the bond sued on was made.
1. A careful research has failed to discover any judicial opinion as to the liability of the state treasurer for moneys received by him on account of deposits of state funds by the courts of this' state up tb this time. But we have "a *622legislative declaration upon this subject, in a joint resolution passed by the general assembly of this state, which was approved December 8th, 1871, which resolution is as follows:
“Whereas, It has not been customary to require the state treasurer to pay into the treasury interest on deposits of state funds : be it
Resolved, That the treasurer of the state shall not be held liable for any such interest. . . . ”
This is not only an opinion of the liability of the state treasurer as to interest received by him by reason of deposits of state funds, as expressed in the preamble or title to the resolution, but it is a declaration as to the law, having the force of law, as contained in the resolution itself; and the courts will be bound to hold it to be law, unless it has been subsequently modified or repealed. Has it been repealed or modified by any subsequent legislation ? On the 25th of February, 1876, the legislaure passed an act “ To amend the laws of this state for the protection of the state treasury, and to define the obligation pertaining to the office of treasurer, and to prescribe his duties, and for other purposes.” Acts of 1876, page 126; Code, §97, and paragraphs and sub-sections thereto. This act is a clear repeal of the joint resolution of 1871, and prescribes a new rule for the duties and liabilities of the state treasurer.
Paragraph 10 of Sec. 97 of the Code provides that the treasurer “ may, with the approval of the governor, deposit all funds set apart for the purpose of education, or any other purpose, not required for immediate use, in any chartered bank of this state, subject to his draft as treasurer, and, with the governor, make such contract with said bank for the use of such funds as may be beneficial to the state.”
The 11th paragraph to this section provides, “ The treasurer shall not, .under any circumstances, use himself, or allow others to use, the funds of the state in his hands, and for every violation of this section he is liable to the state for the sum of five hundred dollars as a oenalty, or a for*623feiture of his salary, if said forfeiture will pay the penalty incurred.”
Section 97 (b) of the Code authorizes the governor to issue a fl.fa. instanter against the treasurer and his sureties for the amount due the state by the treasurer, with the penalties and costs.
Thus the law stood when Treasurer Renfroe assumed the duties and office of treasurer of this state. The declaration no where alleges that the treasurer used or misapplied any funds due the state on account of any deposits made by the treasurer, with the approvál of the governor, or that he received from any bank any sum of money for the use of funds so deposited; but the plain conclusion is, from the declaration in this case, that the treasurer had himself received and allowed others to receive money' from certain banks for the use of funds of the state deposited by him without the approval of the governor, and without any contract having been made by the governor and treasurer with the bank for the use of such funds. If this be so, it is a use of the funds of the state by the treasurer, and others by his permission, for which he incurred a penalty, under paragraph 11, of section 97, which was to be collected in the manner pointed out in section 97(b) of the Code. There is no provision in this act for the collection from the treasurer and his sureties on his bond of any money made by the treasurer, or others by his permission, on account of the use of the funds of the state;.penalties are imposed for this use, and they may be collected in the manner pointed out by the statute. Can the money made or received by the treasurer, or allowed to be made by others by the use of the money of the state, be said to have come into his hands by virtue of his office ? Money received by an officer, by virtue of his office, is money which that officer receives under the law of his office, not in violation of the law of his office; in right of his office, not in wrong. In this case, the money received or made was by a wrongful use of the funds of the state; *624there was no virtue in it; it was wrongful, and a'penalty was imposed for such wrong. There is no allegation that the treasurer had failed to perform the duties of his office; that he had misapplied or used the funds of the state; and that he had failed to account for and pay over any money that he had received by virtue of his office, whereby he became liable to the state; but the breach assigned is that the treasurer received himself, and permitted others to receive, from certain banks certain sums of money for and on account of the deposit of the funds of the state in those banks, it not being alleged that these deposits had been made under a contract between the banks and the treasurer, with the the governor; so that this assignment is equivalent to alleging that the treasurer had received this money and allowed others to receive money by the use of the funds of the state himself, and allowing others to use such funds. For such money so received by the treasurer there can be no recovery on his official bond against him and his securities, and the following authorities are referred to, to sustain the positions laid down : Rensellaer Co. vs. Bates, 17 N. Y., 242; New York vs. Pennock, 60 N. Y., 426; 7 Barn. & Cres., 493; 10 Mo., 560 ; 20 Ohio, 330; 29 Ind., 294; 43 Wis., 81; 15 John., 269; 19 Wend., 283; 37 Wis., 45; 63 Mo., 562; 18 Ga., 48; 20 Id., 103; 47 Id., 642.
2. The next breach assigned is as to the penalties. The declaration is quite meager in this respect; it merely alleges that the treasurer had incurred penalties in the sum of-35,000 dollars, without stating when, where, on what account. Code, §97, par. 11, prohibits the treasurer from using the funds of the state, or allowing others to do so; and for every violation of this section he is liable to the state in the sum of five hundred dollars as a penalty, or a forfeiture of his salary, etc. Under this section, the penalty is visited upon the treasurer. There is no hint even that his sureties on his official bond are toffie made liable for this *625penalty. They are liable for his proper accounting for all funds that shall come to his hand by virtue of his office.
Forfeitures are not favored in the law; courts always incline against them. 15 Wallace, 156. Where a statute may be construed so as to give a.penalty, and also so as to withhold the penalty, it will be given that construction which will prevent the penalty. Vattel, 20 Rule of Construction. This act may be construed so as not to apply the penalties to the sureties, and it will receive that construction. Where a statute creates a new offense and announces the penalty, or gives a new right and declares the remedy, the punishment or the remedy can be only that which the statute prescribes. 3 Hill, 38; 57 Barb., 429; 91 U. S., 35 (1 Otto). The declaration fails to state a case against the principal in this bond wherein he is liable for penalties under the statute.
Pleadings will be construed most strongly against the pleader; therefore, where, from every legal intendment, there is no right of recovery against the defendant to be drawn and concluded from the plaintiff’s declaration, the pleadings are defective, and a demurrer thereto for such cause should be sustained
Judgment reversed
Hall, Justice, concurred, but furnished no written opinion.