Court Opinion

ID: 3697201
Source: CourtListenerOpinion
Date Created: 2016-07-06 06:37:20.420385+00
Date Added: 2024-06-11T13:47:45.967533
License: Public Domain

The plaintiff in error, administrator, being the plaintiff in the lower court, sought to recover judgment against the defendant J.R. Dager  Co., a licensed dealer in securities, and also against the American Surety Company of New York, which company was surety for said J.R. Dager  Co., upon its bond executed to the state of Ohio for a dealer's license. J.R. Dager  Co. was a licensed dealer in securities, and the plaintiff in error claims to have been damaged in the sum of $14,950 by reason of alleged misrepresentations in the sale of certain securities.
The amended answer of the American Surety Company does not definitely state and number the several defenses contained therein, but the parties have treated the latter portion of the amended answer as a second defense.
To such portion of the amended answer designated as a second defense a demurrer was filed. The demurrer was overruled by the trial court, and, the plaintiff in error stating in open court that he did not intend to plead further, the surety company was dismissed.
From such judgment in overruling the demurrer of plaintiff in error to the second defense of the answer of the American Surety Company, error is prosecuted to this court.
Counsel have favored the court with unusually exhaustive briefs, and decisions of this and of sister states, and of the United States, are cited and discussed in considerable detail and at some length.
To attempt to review all or even a considerable portion of the authorities so cited would be impracticable. *Page 34 
In brief, the question for determination is, Did the extension application which was filed by J.R. Dager  Co. in 1926, and upon which the defendant, the American Surety Company of New York, was surety, create an additional liability in the sum of $10,000, or did such renewal simply extend the time during which the former liability could be asserted without increasing the surety company's liability beyond the total sum of $10,000?
The renewal instrument filed in 1926, and which was approved by the then commissioner of securities, among others contained the following provision: "It is hereby mutually understood and agreed by and among the parties hereto that this bond is in continuation of but not in addition to that certain bond in the sum of $10,000 executed by said American Surety Company of New York on behalf of J.R. Dager  Company as a dealer in stocks, bonds and other securities and bearing date on or about the 11th day of March, 1925, and that the liability of the surety under either or both of the said bonds shall in no event exceed the sum of $10,000.00."
The statute in effect at the time this cause of action arose, being Section 6373-3, General Code, provided in substance that every applicant for a dealer's license should execute and file a bond to the state of Ohio in a certain sum, in no case to be less than $10,000, and with such surety as the commissioner required.
Section 6373-4, General Code, provided in substance that, if the commissioner was satisfied of the good repute in business of such applicant and named agents, he should, upon the payment of an annual fee of $50 and an additional fee of $5 for each agent named in the application, register the applicant as a licensed dealer in such securities, and issue a license containing the name of the applicant and all such agents, renewable annually upon the payment of such annual fee, unless revoked as provided in the act. *Page 35 
Section 6373-5, General Code, provided in substance that such renewal license should be taken out at the beginning of each calendar year.
There is no question that the surety company expressly limited its liability to the sum of $10,000, and the pleadings concede that liability to that extent has been paid.
It is apparent that the commissioner of securities approving this bond was of opinion that the bond of the American Surety Company, limiting its liability to $10,000, was in compliance with the statute. Reference is made to the subsequent amendment of this section in April, 1927 (112 Ohio Laws, 274, 275), providing that the application shall cover the original license and renewals thereof.
The reason for the enactment of this amendment in 1927 is discussed by counsel, and wholly different conclusions are drawn from such amendment.
Whether the amendment was or was not a wise enactment is not for this court to determine, but it is apparent to us that the reason for the amendment was to permit beyond any question a continuation of the practice which had been approved by the commissioner for a considerable length of time. Different opinions of the then Attorney General of Ohio are cited and discussed.
From a review of the authorities, we cannot escape the conclusion that the liability under the bond in question was limited to $10,000. Entertaining these views, the judgment of the lower court will be affirmed.
Judgment affirmed.
HORNBECK, P.J., and BARNES, J., concur. *Page 36