Court Opinion

ID: 3600841
Source: CourtListenerOpinion
Date Created: 2016-07-05 23:47:21.267599+00
Date Added: 2024-06-11T09:34:20.911797
License: Public Domain

We are agreed that unless the sureties are liable for the misappropriation of their principal while permanently holding some other or higher office in the employment of the plaintiff than that of bookkeeper, then the judgment should be reversed, because of the failure of the trial court to receive testimony pertinent and material upon the question as to whether Cornwell had been thus permanently employed. The evidence excluded under defendants' exception, bearing upon that question, is sufficiently pointed out in the dissenting opinion at General Term. But the majority of this court are of the opinion that the undertaking in question is broad enough to render the sureties liable for the default of their principal, whether committed while holding the office of bookkeeper, to which he had been appointed at the time of its execution, or while occupying, by appointment of the plaintiff, any other or higher office connected with the conduct of its banking business. I am led to dissent from such decision because impressed with the view that it is not only not in accordance with, but in contravention of the decision of this court in N.M.B. Assn. v. Conkling
(90 N.Y. 116). In that case the recital in the bond asserted that the principal had been appointed to the office of bookkeeper, and the condition which followed provided, among other things, that he should "also faithfully fulfill and discharge the duties of any other office, trust or employment relating to the business of such association which *Page 568 
may be assigned to him or which he shall undertake to perform." Subsequently he was permanently assigned to the office of teller, and, while engaged in the performance of its duties, was guilty of misconduct which resulted in the prosecution of an action against his sureties. The court held that: "The recital in the condition of the bond shows that Joseph had been appointed to the office of bookkeeper; that he had accepted that office and consented to perform the duties thereof. That was the office brought to the attention of the sureties and which they had in mind when they executed the bond. The recital in such bonds, undertaking to express the precise intent of the parties, controls the condition or obligation which follows, and does not allow it any operation more extensive than the recital which is its key, and so it has been held in many cases." The applicability of that case to the one under review will more clearly appear from a statement of the two obligations in appropriate subdivisions. In the Conkling Case the recital is: "Whereas, The above named, the Mechanics' Banking Association, have appointed the above-named Joseph C. Conkling to the office of a bookkeeper of the said association, and the said Joseph C. Conkling hath accepted the same and consented to perform the duties thereof;" and, in this case: "Whereas, Richard H. Cornwell has been appointed a bookkeeper of said bank." In the ConklingCase the condition is: "Now, the condition of this obligation is such that if the above-named Joseph C. Conkling shall faithfully fulfill and discharge the duties committed to and the trusts reposed in him as such bookkeeper" — and as to any other office the condition continues — "and shall also faithfully fulfill and discharge the duties of any other office, trust or employment relating to the business of the said association which may be assigned to him, or which he shall undertake to perform." In this case the condition is: "Now, the condition of this obligation is such that if the above-named Richard H. Cornwell shall well, truly and faithfully perform the duties assigned to and trust reposed in him as bookkeeper so long as he shall continue in that capacity" — and *Page 569 
as to any other office the condition continues — "or if the said Richard H. Cornwell shall be appointed to any other office, duty or employment by the president and directors of said bank, he shall also faithfully perform the duties assigned to and trust reposed in him, and also such other duties as may from time to time be assigned to or undertaken by him in relation to said bank." Now it is urged that the condition of this obligation, so far as it relates to the permanent employment of the principal in some other office, is broader and more comprehensive than the condition in such respect in the Conkling Case, and for that reason it is said that the Conkling Case does not necessarily control the disposition of this action. An opportunity would perhaps be presented for such an argument if the Conkling Case
had been disposed of on the ground that so much of the condition as relates to any other office or employment was not broad enough to include the position to which the bookkeeper had been assigned. But such was not the point of that decision. The court did not hold or suggest that the terms of the condition were not sufficiently comprehensive to include the conduct of the principal in other positions. On the contrary, the argument proceeds upon the theory that the condition may have been broad enough but for the restraining effect of the recital. The court, denying liability on the part of the sureties because to the condition, cannot be allowed any operation more extensive than the recital which it follows, and which is its key.
It is true in that portion of the opinion which immediately follows the discussion of the cases limiting the condition or obligation to the scope of the recital, it is said in substance that the sureties undertook for the fidelity of their principal only while he was bookkeeper, but if, while acting in that capacity, any other duty, trust or employment relating to the business of the bank should be temporarily assigned to him, the obligation also extended to the discharge of those duties. And it is suggested that these remarks, together with such as immediately follow, indicate that the court regarded the condition as failing to embrace in terms the office in question. I *Page 570 
do not so understand them. On the contrary, it seems very clear that their use was to explain that other temporary employment was embraced within the recital, but not other permanent employment, and that, therefore, the condition should be limited accordingly. This will readily appear from a brief reference to the method adopted by the learned judge in stating the reasons leading to the conclusions of the court. He demonstrated, first, that the condition cannot be given an effect more extensive than the recital which it follows; second, the scope of the recital; and, third, that inasmuch as the office in question was not embraced within the recital, the condition must be likewise limited, notwithstanding its terms.
It will be observed that, in stating what was included within the recital, he mentioned any other trust or employment relating to the business of the bank to which the plaintiff should be temporarily assigned while occupying the position of bookkeeper. And in so doing he but stated what the courts had previously held to be embraced within the undertaking of sureties upon bonds containing no provision whatever as to the assignment of the principal to the discharge of the duties of any other trust or employment. It had been so determined in cases cited by the learned judge, notably in R.C. Bank v. Elwood (21 N.Y. 88). He thus announced that which had been judicially determined to be embraced within the recital. And as the recital did not include permanent employment in another position, it necessarily operated to so limit the effect of the condition as to relieve the sureties from liability. If the view which I have taken of the decision referred to be correct, it follows that the judgment should be reversed.
All concur with VANN, J., except PARKER, J., dissenting.
Judgment affirmed. *Page 571