Court Opinion

ID: 9830830
Source: CourtListenerOpinion
Date Created: 2023-09-01 20:32:17.267679+00
Date Added: 2024-06-11T07:43:26.608273
License: Public Domain

On Motion for Rehearing.
The obligation of the defendant, as County Depository, and its liability as such, has no bearing upon plaintiff’s asserted right of subrogation against the depository for wrongful participation with W. E. Reynolds, the Tax Collector, in failing to account to Montague County for taxes collected by him and due the County. The asserted right of subrogation, if any, is to be determined solely by whether -,or not the Tax Collector breached his bond to account to the County for the moneys received by him. Whether or not the county depository breached its obligation to the County, under its contract with the County, is a different question, and that contract is not involved in plaintiff’s suit for subrogation.
An attempt is made to show that the unauthorized- withdrawals from deposits in favor of the County, amounting to $15,-656.27, as' pointed out in our original opinion, did not represent the amount of net indebtedness of the Tax Collector to the County, but that all of that sum,' with ’ the.exception of the amount already paid by the' plaintiff as surety, had been paid over to the county. ■., ’ -.
In, order to prove that point, numerous figures from the auditor’s report 'are quoted, with calculations therefrom. ' The record shows that the Auditor was employed by the plaintiff to go through the'books and ■ record's of the Tax Collector’s official acts, ’ and was introduced as its witness. His reports and testimony are very much involved. Especially so since, according to his testimony, all of the collections made by the Tax Collector were deposited with the depository in a lump sum, without any attempt to- separate the - taxes due the County -from those due. the State, etc. Manifestly, that condition prompted the employment of-.the Auditor to'audit the books and -give a summary of what he found.- And the following appears in the Statement of -Facts: .
Question to the Auditor: “Whát was the total debits not payable to treasurers, the debits on account, of checks not payable to treasurers, during the two years, 1933 and 1934? A. $15,656.27. Mr. Hughston (counsel for the plaintiff): It is stipulated in open court that the items shown in paragraph 5 of plaintiff’s first amended original petition as being on account of Checks of payments not covering the Tax Collector’s compensation ‘as shown by his approved reports’, or disbursements due treasurers entitled to receive the same, are the ones involved in the totals about which the Auditor has just testified, the grand total thereof being $15,656.27.”
And since that was the amount claimed in the petition, as still owing by the Tax Collector to the County, over and above the $8,050 plaintiff had already paid on the judgment against it, we believe it manifest that plaintiff is in no position to now assert a contention contrary thereto.
■ [6] Hence, authorities ■ cited in support of the contention that plaintiff would not be required to pay the County the amount of - the unpaid indebtedness owing by the Tax Collector, if the County had already received the excess, over and above the amount for which subrogation was claimed, because no further loss was sustained by the creditor; such as, City Nat. Bank v. Gustavus, Tex.Com.App., 106 S.W.2d 262; Cline-Clarlc Co. v. State Trust & Savings’ Bank of Dallas, Tex.Civ.App., 81 *508S.W.2d 541; have no application here. Nor is there merit in the further contention that the judgment recovered against it for the $8,050 operated as an estoppel against the County, on the theory of res adjudicata to now claim the amount of such unpaid balance, since the judgment in that case, paid off by the plaintiff, was the judgment rendered against it after Reynolds had been dismissed from the suit; nor was either Reynolds or the County made a party to this suit.
And since, according to plaintiff’s own pleadings and the undisputed proof, Reynolds still owes the County the amount mentioned above, payment thereof would be a condition precedent to plaintiff’s right of subrogation, asserted in its pleadings, under the authorities cited in our original opinion. The provisions of Article 2547, subd. (c), giving the sureties on the County Depositor’s bond for losses sustained through the Depository, the right of sub-rogation to the County, are not applicable here.
Appellee cites Hatcher v. State, 125 Tex. 84, 81 S.W.2d 499, 98 A.L.R. 1213, in support of its plea of the two years statute of limitation (Vernon’s Ann. Civ.St. art. 5526). That was a suit by the trustees of a school district against the State Treasurer and the sureties on his official bond, conditioned for the faithful performance of the duties of his office. The cause of action alleged was loss of funds through the negligent failure of the treasurer to collect a certified check and bank draft which had been remitted to him in his official capacity, to pay off certain bonds issued by the several school districts and owned by the permanent school funds. The court held that the suit was barred by the two years statute of limitation. There was a review of authorities on the point, followed with these conclusions [page 504]:
“ * * * Here the cause of action does not arise out of and is not dependent upon the official bond. If the state treasurer owed defendants in error a duty for the breach of which a cause of action would lie, the law imposed the duty, and the duty rested upon him regardless of the bond. The obligation sought to be enforced, if it exists, arises out of a breach of official duty, not out of the bond. There is no statement in the bond of the state treasurer of the conditions upon which recovery may be had, and there is no promise in the bond to pay in accordance with such conditions. The bond, which is phrased in the same general terms as those contained in the statute, merely affords security for the faithful performance of the official duties. It seems clearly apparent, therefore, that the action is not founded upon the bond.
“Nor is the action evidenced by the bond. The bond contains no statement of what the duties of the treasurer are, and no promise that he will make payment of any particular funds or amount to any certain person. The duties of the state treasurer are found in the statutes. There is no evidence, not even a recital, of them in the bond. Proof of the existence of a duty to defendants in error, of the breach of that duty, and of damages suffered by the breach, must be made by evidence outside of the bond.
“As to the surety, the bond but evidences its promise to stand surety for the principal. Both, the existence and the evidence of a cause of action against the surety must be found in the existence and evidence of a cause of action against the principal. If there can be no recovery against the principal, there can be no recovery against the surety. The bond is but incidental to the official obligation, in the same way that a mortgage is incidental to the debt which it secures. ‘It is well settled in this state that a mortgage is so completely an incident of the debt which it is given to secure that, if the debt is barred by the statute of limitations, the creditor is without remedy under his mortgage.’ State v. Glenn, 118 Tex. 334,. 342, 13 S.W.2d 337, 15 S.W.2d 1028.”
In plaintiff’s first amended petition, on which the case was tried, the items and dates of payment which made up the $15,-656.27, for which subrogation is sought, are specifically set out. The respective dates when those different items accrued began with February 4th, 1933, and ended with September 8th, 1934. The record shows that Reynolds resigned from office about the latter date. This suit was instituted on the 8th day of October, 1936, which was more than two years after the County’s cause of action for all of those items charged accrued, and since the bond of the Tax Collector was for the faithful performance of the duties of his office,, substantially the same as the bond of the State Treasurer, we hold that plaintiff’s cause of action here asserted was barred by the statute of limitation of two years, at *509all events, in accordance with the decision of the Commission of Appeals, last cited. See also Fox v. Kroeger, 119 Tex. 511, 35 S.W.2d 679, 77 A.L.R. 663.
Accordingly, appellant’s motion for rehearing is overruled.