Marcus v. Rice

Sanderson, J. This is an action of contract against the sureties on a bond, dated September 15, 1925, given to dissolve an attachment. The plaintiff is the obligee and the defendants are the two sureties. The only excepting party is the defendant Abraham Werby, who will be referred to as the defendant. At the hearing of the case by a judge without a jury, he found for the plaintiff in the penal sum of the bond and ordered execution in a stated sum. In referring to the defences set up in the answer the judge in his finding of facts stated that he was not satisfied that the plaintiff or her attorney made the alleged false representations or that the defendant relied upon any such representations if they were made; that the defendant is a “capable and intelligent business man, who signed the bond with his eyes open, taking whatever risk might be involved in so doing”; that it was possible counsel for the plaintiff made some statements tending to reassure the sureties and to minimize the risk, but, if so, the judge was not satisfied as to what such statements were or that they amounted to fraud as alleged. A fact' alleged in the answer to have been fraudulently concealed is that on February 20, 1925, the defendant, in the action in which the bond was givfen, had been defaulted. The default to which reference is there made was entered on motion for failure of Joseph Rice, the defendant in the original action, to answer interrogatories, and was to be removed if answers thereto were filed within ten days. On the fifth day after this default the answers were filed by Rice. The judge in the case at bar [293] found that the plaintiff did not reveal to the defendant the fact of this default. This default, entered and removed under the circumstances disclosed, would seem to have no connection with the defendant’s obligations on the bond given to dissolve an attachment made several months later. See Hudson v. Miles, 185 Mass. 582, 585. We are of opinion that the plaintiff violated no duty it owed the defendant in failing to inform him of this default. The defendant contends that the finding should have been in his favor because of concealment of facts relating to the reduction of the amount of the attachment by agreement, the disclaimer of liability by the insurance company and the knowledge of the plaintiff’s attorney that Joseph Rice had been sued in another action and his .bank account attached. The conclusion reached by the trial judge involved a finding that no material facts were concealed which misled the defendant to his prejudice. He was not bound to believe the testimony of the plaintiff’s attorney, but if that testimony was believed no error appears in the conclusion reached by the judge. The recital in the bond to the effect that the attachment “to the value of Fifteen Thousand Dollars ($15,000.) ” was “reduced by order of Court to Two Thousand (2000) dollars” could hot have been found to be a misrepresentation or concealment of a material fact. The reduction was made by order of court even though based upon agreement or consent of counsel. In the absence of any inquiry concerning the matter, the plaintiff was under no legal obligation to tell the defendant what the attitude of the insurance company was in the matter of its liability on the accident policy of Joseph Rice or that the plaintiff’s attorney had begun legal proceedings against Rice for another client. See Province Securities Corp. v. Maryland Casualty Co. 269 Mass. 75, 90, 91, 92. A' promise by the plaintiff’s attorney to keep the defendant informed as to proceedings even if made and not kept would not relieve the defendant from liability on the bond, but it does not appear that the judge found that such a promise was made. Upon the evidence no error appears in the refusal of the trial judge to make a ruling based upon the assumption [294] or upon a finding not made, that the judgment in the original action was obtained by fraud. See Giatas v. Demoulas, 271 Mass. 51, 53. The findings of the judge as to the alleged fraudulent misrepresentations are conclusive against the defendant’s contentions on these issues. The condition of the bond was that Joseph Rice should pay the plaintiff the amount if any that she may recover in the action within thirty days after final judgment. The plaintiff’s attorney testified that he knew thirty days after judgment was entered that the surety was good financially.- It appears from a statement in the record that the defendant in the original action was again defaulted on February 25, 1926, and that damages were thereafter assessed; that on October 25,1926, judgment was entered in the sum of $1,525.25 and execution issued on November 18, 1926; and that the plaintiff held the execution without any action against the principal or sureties and made no effort to notify them of the execution or to collect the same for one year and two months. The evidence justified the conclusion involved in the finding that the judgment remained unpaid for thirty days. We find no reversible error in any of the exceptions argued. Exceptions overruled.