Court Opinion

ID: 6757149
Source: CourtListenerOpinion
Date Created: 2022-07-21 00:28:07.276003+00
Date Added: 2024-06-11T16:02:28.671871
License: Public Domain

Rutherford, J.,
concurring in judgment in part.
The bond in this case, executed by Ted W. Brown, as principal, and the Buckeye Union Insurance Company, as surety to the state of Ohio, is in the penal sum of $100,000 dollars, for the payment of which Ted W. Brown and the Buckeye Union Insurance Company bound themselves jointly and severally, with the condition of the obligation being such, “That, whereas, the above bound principal Ted W. Brown has been Elected to the Office or Position of Secretary of State — for a term beginning 1-13-75 & ending 1-8-79. Now, if the above-bound-principal shall, during his term of office faithfully discharge the duties imposed upon him by law, then this obligation shall be void, otherwise it shall remain in full force and effect.”
In plaintiffs’ complaint, filed in the Court of Common Pleas on October 12, 1976, the Secretary of State, Ted W. Brown, the Buckeye Union Insurance Company, Curry Foods, Inc., John Jones, President of Curry Foods, Inc., and Mid-American National Bank & Trust Company were named defendants. It is alleged that Ted W. Brown, the duly elected Secretary of State of Ohio, is a filing officer within the meaning of R. C. 1309.40(G) and that on or about August 28, 1975, the Secretary of State, Ted W. Brown, in response to plaintiffs’ request for information, requested pursuant to R. C. 1309.40(G), advised plaintiffs that there were no financing statements or statements of assignment on file with the office of Secretary of State on August 28,1975, although there had been a financing statement filed on August 13,1975, by Mid-American National Bank & Trust Company, naming Curry Foods, Inc., as debtor. Further, plaintiffs alleged that “Defendant Secretary of State” unfaithfully discharged the duties of his office by failing to report the existence of this financing statement to plaintiffs; that said duty of defendant Secretary of State is a ministerial duty and that defendant Secretary of State’s issuance of an incorrect statement constituted misfeasance in carrying out the duties of his office, causing damages to plaintiffs as alleged. Plaintiffs concluded by alleging that “Defendant Secretary of State,” due to the negligent performance of a duty imposed by statute, is liable for any and all financial losses suffered by plaintiffs in connection with its dealings with defendant, Curry Foods, Inc.
*15Plaintiffs, as a separate cause of action, incorporated the prior claim, alleged execution and deliverance of the bond, supra, that the information requested by plaintiffs and given by the Secretary of State in the certificate, pursuant to R. C. 1309.40(G), was false and incorrect, and that the prior financing statement, filed by Mid-American National Bank & Trust Company on August 13, 1975, covered the same collateral as the financing statements filed by plaintiffs after receiving the incorrect certification from the Secretary of State. Plaintiffs allege damages sustained as a result of their reliance upon the negligent, incorrect certification made by the Secretary of State and Curry Foods’ inability to pay. Further, they allege that the Buckeye Union Insurance Company is bound as surety to pay the damages sustained by plaintiffs caused by the “Defendant Secretary of State’s” incorrect certification and resulting failure to faithfully discharge the duly of his office imposed upon him by law.
Case No. 80-629.
The case in common pleas court, and appeal therefrom to the Court of Appeals must be decided upon the statutes in effect on August 28, 1975, when the incorrect certification was made.
On August 28,1975, the pertinent parts of R. C. Chapter 2743 (Am. Sub. H. B. No. 800, effective January 1, 1975) provided:
R. C. 2743.01:
“(A) ‘State’ means the state of Ohio, including without limitation, its departments, boards, offices, commissions, agencies, institutions, and other instrumentalities. It does not include political subdivisions.”
R. C. 2743.02:
“(A) The state hereby waives its immunity from liability and consents to be sued, and have its liability determined, in the court of claims created in this Chapter in accordance with the same rules of law applicable to suits between private parties, subject to the limitations set forth in this chapter. To the extent that the state has previously consented to be sued, this chapter has no applicability.
“(B) Awards against the state shall be reduced by the *16aggregate of insurance proceeds, disability award, or other collateral recovery by the claimant. ” (Emphasis added.)
R. C. 2743.03:
“(A) There is hereby created a court of claims. The court of claims is a court of record and has exclusive original jurisdiction of all civil actions against the state permitted by the waiver of immunity contained in section 2743.02 of the Revised Code, and exclusive jurisdiction of the claims of all parties in actions which are removed to the court of claims and determinations pursuant to sections 5315.04 and 5315.05 of the Revised Code. The court shall have full equity powers in all actions within its jurisdiction and may entertain and determine all counterclaims, cross-claims, and third-party claims.”
In Am. Sub. H. B. No. 682, effective July 28, 1975, division (B) of R. C. 2743.02 was changed to division (D) but the wording remained unchanged.
In Sub. H. B. No. 82, effective September 29, 1976, prior to commencement of the action on October 12,1976, by plaintiffs in common pleas court, division (D), supra, of R. C. 2743.02 was amended to read:
“(D) Judgments under sections 2743.01 to 2743.20 of the Revised Code against the state shall be reduced by the aggregate of insurance proceeds, disability award, or other coir lateral recovery by the claimant. ” (Emphasis added.)
In late 1978, the common pleas court, upon motions, dismissed plaintiffs’ complaint against the Secretary of State and the Buckeye Union Insurance Company on the ground that the court lacked subject matter jurisdiction over the Secretary of State and his bonding company, Buckeye.
On April 19,1979, plaintiffs filed notice of appeal, appealing the dismissal of defendants, Secretary of State and Buckeye.5
On March 5, 1980, the Court of Appeals affirmed the dismissal of plaintiffs’ action against the Secretary of State, but reversed the dismissal of Buckeye.
Assuming the negligence of the Secretary of State, Ted W. Brown, due to the failure to make correct certification con*17taining notice of the existing finance security agreement on file, as between Mid-American Bank & Trust Company and Curry Foods, Inc., a ministerial duty, within the scope of employment, imposed under R. C. 1309.40(G), and the claim of plaintiffs being less than the amount of the bond given to secure the faithful discharge of the duties of the Secretary of State imposed upon him by law, recovery based upon the failure of the Secretary of State to faithfully discharge such duty imposed by law becomes a matter of contract liability under the terms of the bond, signed by Ted W. Brown, principal, and the Buckeye Union Insurance Company, surety. The bond provides for joint and several liability of the principal and surety, presumably upon a premium paid to Buckeye.
In Cusack v. McGrain (1939), 136 Ohio St. 27, at 29, it is stated:
“A bond is a contract and, in the absence of some controlling statute, is to be construed according to the fair import of the language used.***” (Emphasis added.)
At this point, note is made of the provision of R. C. 2743.02, supra, that:
“Awards against the state shall be reduced by the ag-gragate of insurance proceeds, disability award, or other collateral recovery by claimant. ” (Emphasis added.)
In my opinion, the action brought against the Secretary of State, a state officer, relative to an act performed in his official capacity and clearly within the scope of his employment, although ministerial in character was an act for which the legislature by the establishment of the Court of Claims consented to the state being sued and have its liability determined, including ministerial acts — such acts not having been excepted, as later provided by amendment of R. C. 2743.02(A)(1), effective March 13,1980, applicable to an act or omission “manifestly outside the scope of the officer’s or employee’s office or employment or that the officer or employee acted with malicious purpose, in bad faith, or in a wanton or reckless manner.”
The collateral recovery by claimant in an independent action in the Court of Common Pleas, as upon the bond in this case, is recognized in the provision of R. C. 2743.02, supra, establishing the Court of Claims, with the recovery upon such *18bond not to be duplicated by recovery in the Court of Claims. It thus clearly appears that under the provisions of R. C. Chapter 2743, establishing the Court of Claims, as in effect and applicable to this case in the Court of Common Pleas, it was not the intent of the legislature to preclude collateral recovery by claimant on the officer's bond.
In Cusack v. McGrain, supra, at page 31, it is stated:
“In the leading case of American Guaranty Co. v. McNiece, 111 Ohio St. 532, 146 N.E. 77, 39 A.L.R. 1289, it was held, as stated in the syllabus:
“ ‘The sureties on a bond of an official, conditioned upon the faithful performance of his duties, are liable to all persons unlawfully injured by the nonfeasance, misfeasance or malfeasance perpetrated by such officer, either by virtue of his office or under color of his office.’
“Applying this rule to the present case in connection with Section 11242, General Code, providing that when one renders his sureties liable on a bond, the injured person may bring action thereon in his own name to recover the amount to which he is entitled by reason of delinquency, the instant action is maintainable. Compare, Maryland Casualty Co. v. McDiarmid, 116 Ohio St. 576, 157 N.E. 321; United States Fidelity & Guaranty Co. v. Samuels, 116 Ohio St. 586, 157 N.E. 325, 53 A.L.R. 36.”
G.C. 11242, now R. C. 2307.06, in pertinent part, provides:
“When a person forfeits his bond, or renders his sureties liable thereon, a person injured thereby, or who is entitled to the benefit of the security, may bring an action thereon, in his own name, against the person and his sureties, to recover the amount to which he is entitled by reason of the delinquency, which action may be prosecuted on a certified copy of the bond. * * * ” (Emphasis added.)
For the reasons set forth herein, it is apparent that the common pleas court erred in dismissing the plaintiffs’ actions against Secretary of State, Ted W. Brown, and the Buckeye Union Insurance Company, surety, on the bond of the Secretary of State, Ted W. Brown. I concur in the judgment of this court affirming the judgment of the Court of Appeals, which reversed the judgment of the common pleas court *19dismissing the action of plaintiffs, Scot Lad Foods et al., against the Buckeye Union Insurance Company, surety, on the bond; and in the judgment of this court reversing the judgment of the common pleas court appealed from, which dismissed the action of plaintiffs, Scot Lad Foods, Inc., et al., against Ted W. Brown, principal on the bond.
Case No. 80-380.
On April 23, 1979, Scot Lad Foods, Inc., et al., plaintiffs, filed a complaint in the Court of Claims, against the Secretary of State, state of Ohio, and the Buckeye Union Insurance Company, praying for judgment against the defendant Secretary of State and for judgment against defendant Buckeye Union, as surety, jointly and severally with the Secretary of State. This claim was alleged to arise from the same alleged unfaithful discharge by the Secretary of State of the duties of his office, occurring on August 28, 1975, as were alleged in the prior action of plaintiffs, Scot Lad Foods, Inc., et al., against Secretary of State, Ted W. Brown, state of Ohio; the Buckeye Union Insurance Company; Curry Foods, Inc.; John Jones, President of Curry Foods, and Mid-American National Bank & Trust Co. — in which case, upon motions, the plaintiffs’ cause of action against defendant, Secretary of State, Ted W. Brown, and cause of action against defendant, the Buckeye Union Insurance Company, were each dismissed in 1978 for want of jurisdiction over the subject matter.
R. C. 2743.16 provides, in part, that an action against the state in the Court of Claims “*** shall be commenced no later than two years after the date of accrual of the cause of action***.” The action was not commenced in the Court of Claims until nearly four years after the cause of action accrued. However, Scot Lad argues, and the Court of Appeals held, that by the plaintiffs having commenced the action in common pleas court and failed otherwise than on the merits, the time limitation proscribed in R. C. 2743.16 was extended in the subsequent action commenced in the Court of Claims by virtue of the savings provision of R. C. 2305.19.
The majority opinion holds that since this court has “determined that the claims against the Secretary of State and his bonding company were improperly dismissed in the *20Court of Common Pleas, there is no dismissal otherwise than upon the merits occasioning a need to apply R. C. 2305.19.”
In my opinion, whether or not there was a dismissal otherwise than upon the merits in the case in common pleas court by Scot Lad, Inc., et al., against Secretary of State, Ted Brown, and Buckeye Union Insurance Co. et al., is immaterial; and there having been no action timely commenced within two years in the Court of Claims, which was thereafter dismissed otherwise than upon the merits, the savings provision of R. C. 2305.19 is inapplicable. Further, in Larwill v. Burke (1900), 10 C.D. 579, at 594, affirmed without opinion, 66 Ohio St. 683, it is stated:
“Under sec. 4991, Rev. Stat., the new action to be commenced within one year after the party has failed in his first action otherwise than upon the merits, must be the same as the first action.
“This not the same action as the one commenced in Franklin County. It has not the same parties, in the first action John C. Larwill was the plaintiff and Stevenson Burke was the only defendant. In this action there are a number of defendants besides Burke, and for this reason sec. 4991, Rev. Stat., has no application.”
I find that the Court of Appeals erred in reversing the judgment of the Court of Claims, dismissing the action filed there for the reason that said action was not filed in the Court of Claims within two years from the time the action had accrued, as provided by R. C. 2743.16, the savings provision of R. C. 2305.19 being inapplicable.
For the reasons set forth herein, I concur in the judgment decreeing dismissal of the action within the Court of Claims, case No. 80-380; also, in the judgment of reversal and remand of the action originating in the Court of Common Pleas of Franklin County, case No. 80-629 to such court for further proceedings according to law, limited however to the action upon the bond, to which action upon the bond, Ted W. Brown and Buckeye Union Insurance Company are proper and necessary parties.

 The notice of appeal specified appeals from the orders dismissing the Secretary of State and Buckeye Union Insurance Company, and from the final judgment entered March 30,1979, dismissing the entire case.