Pacific Co. Ex Rel. Hamilton v. Cont. Cas. Co.

Tolman, J. This is an action upon the official bond of a county treasurer, which was tried to the court, sitting without a jury. Findings of fact were made favorable to the plaintiff, and a judgment was entered against the defendant Continental Casualty Company for its proportionate share of the shortage found to exist. The defendant against whom the judgment runs has appealed. For some eight years prior to January, 1931, the defendant Nupp had been chief deputy and cashier in the office of the county treasurer of Pacific county. In November, 1930, Nupp was elected county treasurer for the ensuing term, and on January 10,1931, he took office as such. At that time, the books of his predecessor showed a balance of cash on hand and in bank of $106,-743.65. In addition to the book showing, which is not questioned, Mr. Pederson, the outgoing treasurer, testified to an accounting and the counting of the cash and cash items, in which he personally participated, which convinced and satisfied him that the full amount shown by the books was then turned over to Nupp as his successor. The finding’s made by the trial court are to that effect. Later, on February 27, 1933, shortages were discovered in the treasurer’s cash, which were finally found to amount to the sum used by the trial court in fixing the amount to be recovered from the appellant. The sum and substance of the first two questions presented is to the effect that the trial court erroneously assumed that Nupp actually received from his predecessor the cash balance then shown by the *523 treasurer’s books; and that, as appellant became a surety for Nupp at tbe time he assumed tbe office, tbe so-called erroneous assumption is tbe only basis for bolding that tbe later failure to account established tbe liability of tbe surety. There are several answers to this contention. (1) Unless there be evidence of some sort impeaching tbe books of tbe outgoing treasurer, those books are sufficient evidence to establish tbe fact. We find no evidence and nothing more than a suspicion to impeach tbe books. (2) Tbe testimony of tbe former treasurer, Pederson, supports tbe record of bis office, and that testimony alone would be sufficient to make a prima facie case. (3) Even if it be assumed that Nupp, while a deputy under tbe former treasurer, bad misappropriated county funds, still tbe method which be later followed while be was county treasurer was tbe equivalent of tbe method disclosed and discussed in tbe case of White & Bollard v. Standard Accident Ins. Co., 175 Wash. 174, 27 P. (2d) 123; and tbe taking of tbe last money received to cover prior shortages (if that was done) would be a breach of duty covered by tbe bond. This subject was thoroughly discussed and considered in tbe case just cited, and this court deliberately adopted tbe rule defined in tbe following brief quotation: “But tbe fact that a shortage accruing within tbe term covered by tbe bond was superimposed upon a ground work of prior shortages does not attach to tbe later shortage tbe legal status of tbe earlier. ’ ’ In June, 1932, tbe appellant attempted to procure its release as surety under tbe provisions of our statute, Rem. Rev. Stat., § 9942 [P. C. § 520] et seq. It appears that a proper notice was personally served upon treasurer Nupp, but no such notice was ever filed with tbe county clerk as required by § 9943 [P. O. ■§521]. Instead of following tbe statute and filing a *524 notice with the county clerk, an attempt was made to serve and file the notice with the board of county commissioners by registered mail. Tbe several county commissioners, called as witnesses, denied any knowledge of sucb a notice, and no sucb notice could be found in tbe records or files of tbe board. We disregard everything done or attempted for tbe purpose of perfecting a filing with tbe board of county commissioners. Sucb a filing would be of no avail. Tbe statute expressly provides tbe course to be pursued, and only by, at least, a substantial compliance with tbe statute can a surety obtain a release. Rem. Rev. Stat., § 9934 [P. O. § 512], provides that tbe official bonds of all county and township officers (except that of tbe county clerk), shall be filed with tbe county clerk. Tbe requirement of § 9943 [P. C. § 521], that tbe withdrawal notice be filed with tbe county clerk is therefore based upon reason; it shows a logical purpose and must be followed. Upon tbe theory that tbe shortage occurred before tbe effective date of its bond, tbe appellant argues that it was prejudiced by tbe release by tbe county of tbe sureties upon tbe official bond of treasurer Pederson, who preceded Nupp as treasurer. Since we have already determined that tbe facts found by tbe trial court, supported by tbe testimony, negative any such prior shortage, a further discussion is unnecessary. Tbe defendant Nupp was called as a witness by tbe appellant, and, after be bad testified to tbe nature of bis duties while a deputy under bis predecessor, be was asked to state whether or not, at tbe time he took over tbe office, a substantial shortage existed. Various objections were interposed; a considerable discussion followed, during which tbe court suggested that the witness might be asked if be bad misappropriated any of tbe county funds while a deputy, and *525 also that the witness might he interrogated as to the truth or falsity of the treasurer’s books at the time of the transfer of the office. Counsel for respondent suggested that the witness be advised of his constitutional right to refuse to incriminate himself, and finally the witness was withdrawn without having answered the question. He was later recalled and asked to answer the original question as modified by the suggestions of the trial judge. The whole result was that Nupp testified that he made the entries in his predecessor’s cash book, that the cash balance shown on the books included the money in the till and the money in the bank, but outside of that his memory seemed to fail. Perhaps, if the case had been tried to a jury, this situation would demand careful consideration; but since the trial judge had presided in a cause where Nupp was convicted of falsifying public records, we are by no means convinced that anything which might have been elicited from Nupp under any circumstances would have been sufficient to impeach the treasurer’s record, to overcome the testimony of the former treasurer, or to lead the trial court to make findings other or different from those which are now before us. Finding no error, the judgment is affirmed. Mitchell, Steinert, Geraghty, and Beals, JJ., concur.