Court Opinion

ID: 5628685
Source: CourtListenerOpinion
Date Created: 2022-01-11 05:09:45.198162+00
Date Added: 2024-06-11T08:37:43.069151
License: Public Domain

Felton, J.,
dissenting. It is my opinion that the ruling in the second division of the opinion in Hurt & Quin Inc. v. National Surety Corp., 81 Ga. App. 683, is decisive of the issue in this case and until reversed should control this case. The majority opinion bases its rulings on two so-called distinctions between the two> cases; the first, that in this case it is alleged that Whitner & Company “diverted” the funds, whereas in the above case it was alleged that it “failed and neglected” to pay over the funds. I concede that the instant case differs from the former case in this respect but in the National Surety case, in view of the ruling in the second division of the opinion, it would have been immaterial whether it was alleged that Whitner & Company diverted the funds, failed or neglected to pay them over or embezzled them, because one cannot embezzle his own money. Since the court in that case held that the money belonged to Whitner & Company, the allegations as to what it did with respect to them added nothing to the statement of the cause of action. The second distinction between the two cases, as relied on by the majority opinion, is that it is alleged in the instant case that the borrowed funds were to be disbursed by the bank and were disbursed directly to Whitner & Company as local agent of Hurt & Quin. I think the petition and exhibits in the National Surety case showed the fact that the money borrowed was to be paid by the bank to Whitner & Company as local agent of Hurt & Quin. There was a rider in the National Surety case, attached to the master policy, providing that “it will not be necessary, however, for said bank to wait until said list has been furnished to this company or acknowledged by this company before disbursing the amount of such loan to this Company’s agent, Whitner & Company.” The allegations of both petitions alike show that the bank was to disburse the borrowed money to Whitner & Company, and show that Whitner & Company was designated as agent of Hurt & Quin, but such designation as agent was not done for the purpose, nor did it have the effect, of rendering the borrowed funds *174the property of Hurt & Quin. The parties had long and complicated agreements and it was necessary to state the capacity in. which each was acting so that the ultimate rights of all could be ascertaind as between any two or more. The statement in the above-referred-to rider, as well as the Exhibit NN, attached to the instant petition, as well as some of the other exhibits, show on their face that the references to payments to “Whitner & Company as agents” were descriptio personae and had no other meaning. Certainly they show that the borrowed money did not belong to Hurt & Quin or to any insurance company. Thus the allegation that such was true, if it should be so interpreted, falls when the exhibits destroy it. To clearly illustrate that the term “agent” used in the exhibits, is purely descriptio personae, let us take the Exhibit NN, present in the instant case and lacking in the National Surety case. This was the agreement between the First National Bank, Georgia Fire Insurance Service Inc., Florida Life Insurance Service Inc., and Whitner & Company. The first paragraph of the agreement provided how each party would be referred to in the agreement. For instance, the Georgia Fire Insurance Service Inc. was to be called “Borrower”; the bank was to be called “Bank”; Whitner & Company was to be called “Agent.” It follows that when this agreement, Exhibit NN, provides that “said bank is authorized and directed to disburse the net proceeds of said loan to said agent,” it simply meant that the bank was authorized to disburse the proceeds to Whitner & Company, and it did not mean that the parties agreed that the money belonged to anyone but Whitner & Company. The obvious purpose of this specific provision was to authorize the bank to pay the money directly to an indorser on the note given for the loan instead of to the borrower, or principal, Georgia Fire Insurance Service Inc. Insofar as averring that the moneys allegedly diverted belonged to anyone other than Whitner & Company, as far as the allegations of agency are concerned in their receipt from the bank, the allegations in the two cases are substantially the same. Now I come to' that part of the ruling in the National Surety case which I think controls this case under practically identical allegations. It is substantially alleged in each case that Whitner & Company retained from premium remittances sufficient sums *175to pay the bank to cover unearned premiums. If there is anything in either case to produce liability on the bond, it is the fact that when Whitner & Company retained the unearned premium money to pay to the bank, instead of remitting it to its general agent or insurance company, it held the sums, so1 withheld, in trust for its owners and the bank, and a diversion of such sums would be covered by the bond. However, this court has held in the National Surety case that under these ' allegations the money belonged to Whitner & Company and it was only indebted to Hurt & Quin and the insurance company. It is my opinion that before we can now reverse this case, we will first of necessity have to overrule the National Surety case. Until this is done, we are bound to follow the ruling in that case to which I have referred.