author: BROWN, C.

text:
    CARTHAGE STONE COMPANY v. TRAVELERS INSURANCE COMPANY, Appellant.
    In Banc,
    May 17, 1918.
    INDEMNITY INSURANCE: Duty of Insured to Minimize Damages. An indemnity insurance company, which has from the institution of a suit for damages against the insured company hy one of its employees for personal injuries steadfastly denied its liability because of lack of timely notice) does not. hy a letter notifying the insured that the employee’s claim can he settled for a named small sum and offering “by way of compromise” to pay one half of said sum for a release and a stipulation of dismissal, relieve itself from the duty to pay the judgment subsequently obtained against the insured in an undefended trial. Such facts do not justify an invocation of the general rule that the insured company should pay a sum to mitigate the damages when it has the right to recover that sum from the indemnifying company. [Dissenting opinion of FARRINGTON, J., of Springfield Court of Appeals, in same case, 186 Mo. App. 1. c. 332 et seq., approved and adopted.]
    Appeal from Jasper Circuit Court. — Hon. David E. Blair, Judge.
    Affirmed.
    O. G. Mossman and McReynolds & Halliburton for appellant.

      Bailey & Bailey and Howard Gray for respondent.
   BROWN, C.

This case is certified to us by the Springfield Court of Appeals upon a division of opinion in that court stating the constitutional grounds therefor.

The plaintiff is a corporation engaged in quarry-, ing stone in this State. The defendant is a Connecticut corporation doing the business in this State of selling indemnity insurance against liability of employers for accidents sustained by employees in the course of their employment. In June, 1908', it sold and issued to plaintiff its policy whereby it agreed with plaintiff “as respects bodily injuries accidentally sustained, including death at any time resulting therefrom,” as follows: (lj “To indemnify the assured against loss by reason of the liability imposed upon him by law for damages on account of such injuries.” (2) “To serve the assured upon notice 'of such injuries by such investigation thereof, or by such negotiation or settlement of any resulting claims as may be deemed expedient by the company.” (3) “To defend in the name and on behalf of the assured any suits which may at any time be brought against him on account of such injuries, including suits alleging such injuries and demanding damages therefor although such suits, allegations or demands are wholly groundless, false or fraudulent.” (4) “To pay all costs taxed against the assured- in any legal proceeding defended by the company, all interest accruing after entry of judgment upon such part thereof as shall not be in excess of the limits of the company’s liability as hereinafter expressed, all expenses incurred by the company for investigation, negotiation or defense, and the expense incurred by the assured for such immediate surgical relief as shall be imperative at the dime any such injury is sustained.”

By the terms of the agreement contained in it, the policy was made subject to the following condition: (1) “No action shall lie against the company to recover for any loss under paragraph 1, foregoing unless it shall be brought by the assured for loss actually sustained and paid by him in money in , satisfaction of a judgment after trial of the issue.” (2) “No condition or provision of this policy shall he waived or altered except hy endorsement attached hereto signed by the president, a vice-president, secretary, or assistant secretary of the company.”

All the questions before ns in this appeal relate to the effect of these provisions of the policy considered in connection with the action of the parties with respect to the matters to which they relate.

In April, 1909, and while this policy was in force one David 0. Perry, an employee of the plaintiff in a capacity which brought him within the terms of the policy, was injured in the course of his employment. The question arose and was tried in this case as to whether notice was given by the plaintiff to the defendant immediately upon the occurrence of the injury in accordance with a requirement of the policy. There was evidence tending to prove that it was, and also that it was not given. The jury, upon a proper submission of this point, resolved it in favor of the plaintiff, and, upon an examination of the evidence and instructions upon which it was submitted, we see no reason to disturb the verdict in that respect, so that it is eliminated, except in so far as the existence of the controversy may he an element in other questions. The fact will be assumed.

November 4, 1911, Perry instituted suit in the Jasper Circuit Court against this plaintiff to recover $4000 on account of his injury, and caused service to be had upon this plaintiff, who immediately transmitted to defendant the' process so served, including a certified copy of the petition. In answer it received from MoEeynolds & Halliburton, acting as attorneys for defendant, under date of November 17, 1911, the following:

“In the matter of the ease of David O. Perry v. Carthage Stone Company, returnable to the November Term, 1911, Circuit Court for Jasper County, Missouri, we as local attorneys for the Travelers Insurance Company are instructed to notify you that the company has been waiting to hear from you as to whether or not this case was ever reported to the Travelers Insurance Company; that they have no record of it and to date have not received any information from Mr. Logan as to whether the case was reported at the time.
“Pending the receipt of this information, they instruct us to advise your company and Mr. Logan on behalf of the Travelers Insurance Company that the Travelers Insurance Company will file through us the necessary pleadings in the case to protect against a default but that our action in so doing shall not be a recognition of liability on the part of the Insurance Company for the case, and shall be without prejudice to the rights of either party..
“We write you this letter under instructions of Mr. O. C. Mossman, attorney for the Travelers Insurance Company, at Kansas City, Missouri. We also enclose herewith a copy of the letter we this morning received from Mr. Mossman in regard to the case of Perry v. Carthage Stone Company.”

On January 5, 1912, the same attorneys wrote the plaintiff as follows:

“In the case of D. 0. Perry v. Carthage Stone Co., in which we appeared and filed answer for you, after notifying you that we did so at the request of the Travelers Insurance Company, with the further notice that the Travelers Insurance Company did not hold themselves bound by appearing to answer, to defend the case, and did not admit any liability to you by appearing and answering; that they appeared and answered simply' ■for the purpose of holding the case until they could determine whether they were under liability to you on account of the alleged injury.
“We have been instructed by the Travelers Insurance Company to withdraw as attorneys in that ease, and to notify you that it will be necessary for you to employ attorneys to look after and defend that case, as the Travelers Insurance Company has decided that it is not liable to you for the injuries alleged and sued for in that ease.
“So you are hereby notified that we, as attorneys for the Travelers Insurance Company, will not appear further in that case in the defense thereof, and that, if you desire to defend in that case, you will employ attorneys to defend in your behalf.”

On February 12, 1912, the following entry was made in the ease: “By leave of court McReynolds & Halliburton withdraw as attorneys for defendant,” and on April 1, 1912, the demurrer they had filed was overruled, the matter being taken up “by consent,” with permission to answer over on or before May 5th. On June 13th the matter was again taken up, judgment for want of answer entered for plaintiff, an inquiry of damages was had and final judgment entered for $3000. This judgment was afterward set aside, but finally re-entered and paid by the plaintiff.

In the meantime and on April 8, 1912, the attorney of defendant at Kansas City wrote to plaintiff the following letter:

“I wish to formally advise you that the case of Perry vs. your company can be settled for $150. Inasmuch as the Travelers Insurance Company have declined the defense of this case, of which fact you have heretofore been informed, I desire to say that that company by way of compromise offers to pay one-half of the suggested amount, or $75, for a release and a stipulation for dismissal in the case.
'“I wish also in this connection to advise you that it is your duty to mitigate the damages as much as possible, and that your claim against the Insurance Company can only be for such amount as was necessary for you to pay in settlement of the case.
“While in your city on the 5th inst. I took this matter up with Mr. J. D. Harris, attorney for the plaintiff, and advised him as to our position.
“You may consider this proposition open for ten days.”

The court excluded this letter and also evidence offered by defendant tending to prove that a settlement could have been made at that time for $150. To this action exception was duly saved. The jury found for the plaintiff and this judgment for $3,081.75 was duly entered upon the verdict, from which this appeal was taken to the Springfield Court of Appeals. That court,- in an opinion by Sturgis, J., in which Robert-soN, P. J., concurs, held that the judgment should be reversed, and the cause remanded for retrial, summarizing its conclusions as follows:

“We think the facts of this case clearly bring the plaintiff within the rule conceded by it, that a person under the general rule now under consideration should pay a sum to mitigate his damages when he has the right to- recover that sum from the wrongdoer; and that this defendant did in effect say to the. plaintiff that this case can be settled for $150 and you may settle for that amount and we will litigate as to whether it was our. duty to defend the case and if the issue is found against us, the judgment may be for $150 and your costs to date.”

Farrington, J., dissented in an opinion, questioning the conclusion of the majority as to the effect of the letter of April 3912, in connection with the provisions of the contract of insurance hereinbefore set out, and holding that the judgment of the trial court should be affirmed. We think that the dissenting opinion correctly states the law applicable to the facts of this case and agree with the conclusion at which it arrives. We therefore adopt the opinion of Judge FaReiNgtoN, which will be found reported in volume 186 of the Missouri Appeal Reports at page 332 and following, as the opinion of this court. The judgment o£ the circuit court for Jasper County is accordingly affirmed.

Bailey, G., concurs.

PER CURIAM: — The foregoing opinion of BbowN, C., is adopted as the opinion of Court in Banc.

All concur except Bond, J., who dissents,

concurring in the majority opinion of the Springfield Court of Appeals, 186 Mo. App. 318,


source: Caselaw Access Project

author:
BROWN, C.
      GRAVES, C. J. BOND, J.

license: Public Domain

text:
    R. I. JANUARY, Appellant, v. LEVI MARLER et al.
    In Banc,
    May 17, 1918.
    1. HOMESTEAD: Home. The homestead statute was framed on the principle that the home is the thing to he encouraged.
    2. -: Head of* Eamily. The homestead statute applies alike to “the homestead of every housekeeper or head of a family,” and this description, carefully preserved in its disjunctive form, is repeated in section after section of the, act.
    3. -: Dwelling House. The homestead statute defines the word homestead to he the “dwelling house and appurtenances, and the, land used in connection therewith’’ to the extent specified.
    4. -: Family: Relationships to Head. The “family,” as used in the homestead statute, is the personnel of the home; and it is usually unnecessary to discuss the degrees of consanguinity to which the tern} refers. In this case the family consisted of an unmarried man, who owned the forty acres of land, and an elderly maiden sister, who resided with him thereon, kept his house in order and devoted her spare time to manual labor upon the fifteen acres of cultivated land, and as a result of such labor in the course of many years acquired a couple of horses, a cow and two calves, but otherwise received her support from him; and it is held that 'there was a family within the meaning of the homestead statute, and that he was “the head of a family.”
    5. -: Sale Under Execution: Excess: Title of Purchaser. Judgment for debt was obtained against an unmarried man, who was the owner of forty acres of poor land, upon which was a dwelling house, about fifteen acres of which had been reduced to cultivation. He had been the owner for twenty years, and during fourteen years of that time occupied the dwelling house with his widowed mother and maiden sister; after the mother’s death he and the sister continued for six years to -reside on the land. The sister kept the house and worked out of doors, as well as in the house, and as a result of her manual labor acquired a little live stock, but otherwise she neither had nor earned any money, but the brother managed the place and supported her. After the judgment against the brother he conveyed the forty acres to her, and she conveyed it to another, who knew the facts concerning the indebtedness. Execution was issued and the property sold and conveyed by the sheriff to plaintiff, who brings suit to have the brother’s conveyance set aside as a fraud upon his creditors. Held, that the property was a homestead, the brother the head of a family, and the conveyances could not be set aside as a fraud upon creditors.

      Held, by GRAVES, O. J., concurring, with whom WOODSON, J., concurs, that the owner of a homestead can convey the same without committing a fraud against his creditors, and the property being of but little value and entirely within the quantity and value fixed by the statute, the sole question is whether a homesteader who has a creditor can convey good title to the homestead ■ proper without being subjected to a charge of fraud, and the question of whether he can convey the surplus above the homestead in value or quantity is not for adjudication. [Distinguishing Armor v. Lewis, 252 Mo. 1. c. 584, and Field v. Jacobi, 181 S. W. I. c. 69, and holding that the question of the right of the homesteader to convey the surplus over and above the homestead proper was not involved in those cases.]

      Held, by BOND, J., dissenting, that the sale, under execution, of land subject to a homestead, is, as to the homestead itself and the entire interest arising therefrom, void; but as to the remainder estate, after the lapse of all homestead rights, the sale carried the title and subjected it to the payment of the debt. [Citing dissenting opinion in Armor v. Lewis, 252 Mo. 1. c. 584, and the concurrence therein in Fields v. Jacobi, 181 S. W. 1. c. 69.]
    Appeal from Reynolds Circuit Court. — lion. E. M. Dearing, Judge.
    Affirmed.

      Brewster & Brewster, 0. L. Munger and B,. I. January for appellant.
    (1) A debtor on the eve of insolvency, conveying all his' real estate to a near relative, is a badge of fraud; and when the evidence shows a sale under such circumstances to a sister of a $500- farm where she only pays $10, and no note for the remainder, calls for 'dose scrutiny by courts of equity, and in such eases courts will have no hesitancy in declaring such conveyances fraudulent as against creditors. Grocery Co. v. Monroe, 142 Mo. 165; Hurley v. Taylor, 78 Mo. 238; Snell v. Harrison, 104 Mo. 158; Seger v. Thomas, 107 Mo. 635; Klauber v. Schloss, 198 Mo. 502. (2) In order that an unmarried man may be entitled to a homestead in lands, exempt from execution on debt, there must be a person living with him on said premises, who is legally or morally depending on Mm for support, and one whom he does support. It is not enough that he may support the person, hut the person must be wholly dependent on him for support. R. S. 1909, sec. 6704; ElHot v. Thomas, 161 Mo. App. 445; Robinson y. Turner, 14 Ky. Law Rep. 79; 15 Am. & Eng. Ency. Law, 589; Brokaw v. Ogle, 170 Ill. 126; Ramsey v. Ferguson, 32 Ky. L. R. 1033; Fehd v. Oskaloosa, 117 N. W. (Iowa), 980; Harbison v. Vaugh, 42 A,rk. 539.

      John II. Raney and J. B. Daniel for respondent.
    (1) An unmarried man with whom a sister lives constitutes a family within the meaning of the homestead law, and if he contributes in part to the support of such sister he is the head of the family. Broyles v. Cos, 153 Mo. 242; Duncan v. Frank, 8 Mo. App. 289; Bank v. G-uthrey, 127 Mo. 189. (2) . A homestead right acquired by the head of a family is not lost by the death or removal of all other members of the family so long as he continues to reside upon the place. Elliot v. Thomas, 161 Mo. App. 447; Beckman v. Meyer, 75 Mo. 333; Biffle v. Pullman, 114 Mo. 50.
   BROWN, C.

This is a suit in equity to set aside a deed from defendant Levi Marler to his sister, the defendant Mary Ann Rebecca Marler, dated May 8, 1912, and conveying forty acres of land in Reynolds County, for fraud against plaintiff, a creditor.

The facts are that on May 31, 1912, one Smith recovered, in the Reynolds Circuit Court, judgment against Marler for two hundred and eight dollars upon a' promissory note. He assigned this judgment, to plaintiff on June 3, 1912. Plaintiff caused execution to be issued on the judgment .and levied on this land, which was sold by the sheriff, and he became the purchaser, receiving a sheriff’s deed therefor. On September 13,- 1913, Mary Ann Rebecca Marler conveyed, the land to the defendant Coleman, who knew the facts concerning the indebtedness.

The only question made by the parties is whether or not the forty acres of land involved in the controversy was the homestead of the defendant Levi Marler at the time of the conveyance to his sister.

> The land was of little value, only fifteen acres of it having been cultivated up to the time of the trial. It had sufficed as a home for the Marler family for forty years. The father died twenty-two years before the trial, leaving a widow and five living children, and two children of a deceased daughter. The defendant Levi bought out all the other heirs, and he and his defendant sister continued to live on the land as their home until, the execution of the deed to defendant Coleman, the mother living with them until her death1, which occurred six years before the trial. At the time of her death Levi was forty-one years old and Mary Ann Rebecca forty-five. She worked out of doors on the place as well as in the house, and some of the little stock which they accumulated was owned by her. There was nothing in tbe evidence to indicate that she had or earned any money for her own support, otherwise than by her labor on the place. Her position there is described by one of appellant’s witnesses as follows: “I know Levi Marler had control of the place; that he managed the place and supported her. He is an unmarried man; he never married.” The evidence on both sides tends strongly to support this statement. The only evidence relied on by appellant to show any other relation' is that she worked hard and accumulated a little stock of her own while doing so.

It is admitted by the parties in their briefs that the only question in this case is whether, at the time of the execution of the note which is the foundation of the judgment nnder which the appellant claims, Levi Marler was “a housekeeper or head of a family” within the meaning of that expression as used in Section 6704, Revised Statutes 1909. He owned the place, and it was his home in the sense that it was his only domicile. His occupation of the premises must, in the absence of all explanation, be attributed to such ownership. As owner and occupant he was, prima-facie at least, in control of all the activities of his own household. It was his home, and, in the sense in which the term is used in the section we have already cited, he was the housekeeper. The homestead statute seems to have been, framed upon the principle that the home is a thing to be encouraged, and it requires no argument to demonstrate its public utility and that the community in which1 the people live in their own homes is a fortunate one. This statute applies alike to “the homestead of every housekeeper or head of a family” and this description is repeated, carefully preserving its disjunctive form, in section after section of the act, so that we are not at liberty to assume that the form was carelessly or awkwardly used. We must assume that the legislative intention corresponded with the legislative words. The word “homestead” as used in the foregoing quotation from the statute had its ordinary meaning in such a connection, and that there should be no mistake in. that respect the Legislature defined it as the “dwelling house and appurtenances, and the land used in connection therewith” to the extent specified. By the passage of the act this became the legal definition of the word homestead as used in it. We mention these particulars to indicate that in case of this particular ‘act it is unnecessary to enter upon any discussion of the meaning of the words “head of a family.” The “family” is the personnel of the home, and it is unnecessary in this case to discuss the degrees of consanguinity, if any, to which the term may refer. Xn this particular case the owner’s sister, an elderly maiden lady, resided with him, kept his house in order and devoted her spare time to manual labor upon the fifteen acres of ground which seems to have constituted the cultivated land of the homestead. These two were the family. She was supported from the land, and seems, during the many years she resided on it, to have accumulated a couple of horses, a cow and two calves. The argument of the appellant was largely devoted to showing that she was independent of her brother in the matter of sustenance, and should have made her own home. The circumstances in evidence do not so impress us. They were sufficient to entitle the owner to the benefit of the homestead as to the land in question, and, for that purpose, his sister was a member of his family. “It is not necessary that he shall be a father or a husband.'’ ’ [Grocery Co. v. Monroe, 142 Mo. I. c. 170; Broyles v. Cox, 153 Mo. 242, 248; Bank v. Guthrey, 127 Mo. 189; Brown v. Brown’s Admr., 68 Mo. 388; Whitehead v. Tapp, 69 Mo. 415; Forbes v. Groves, 134 Mo. App. 729.] In the case last cited the question seemed to be whether the son or his aged father was at the head of the family. In deciding in favor of the former the Kansas City Court of Appeals remarked: “It is one thing to be honored as- the patriarch of the family and quite another to possess real and final authority in its affairs.” The appellant cites Elliot v. Thomas, 161 Mo. App. 441, as an authority for the proposition that “in order that an unmarried man may be entitled to a homestead in lands, exempt from execution on debt, there must be a person living with him on said* premises, who is legally or morally depending on him for support, and one whom he does support. It is not enough that he may support the person, but the person must be wholly dependent on him for support.” If there is anything in the elaborate and learned opinion in that case inconsistent with the doctrine we have stated and cases we have cited, we are compelled upon principle and authority to disregard it.

The judgment of the circuit court is affirmed.

Bailey, G., concurs.

PER CURIAM: — The foregoing opinion of BeowN, C., is adopted as the opinion of Court in Banc.

Grooves, G. J., concurs in separate opinion, in which Woodson, J., joins; Williams, Blair and Walker, JJ., concur; Bond, J., dissents in separate opinion; Baris, J., dissents.

GRAVES, C. J.

(concurring’) — I fully concur in the opinion of the Commissioner.

The only question in the case, as said by the Commissioner, is whether or not this forty acres of land, was, in fact, the homestead of Levi Marler, when he made the deed to his sister. If it was his homestead he could convey it without committing a fraud against his creditors, even though ' they be judgment creditors. That the owner of a homestead can convey the same without being subject to the charge of a fraudulent conveyance is too well settled in Missouri to require further comment. In this case there was but forty acres of land, and it was of but little value. It was fully within tbe quantity and value fixed by the homestead law. Such being the case an action in equity to set aside the homesteader’s deed to this forty acres, on the ground of fraud as against his creditors (which is the present action), cannot be sustained. There is no question' about a surplus over and above the statutory homestead involved in this action, for the good reason that the land conveyed (all the land the grantor owned) was less both in quantity and value, than the allowance of the homestead law.

The questions involved in Armor v. Lewis, 252 Mo. l. c. 584, are in no way involved in this case. Nor were they involved in the case of Fields v. Jacobi, 181 S. W. l. c. 69. There was an attempt to force the questions in Armor v. Lewis into the Fields-Jaeobi case supra, but they were no more involved there than they are in the instant case. Because they were not involved, two of the judges dissented to that portion of the opinion which undertook to drag (by the ears) the questions in Armor v. Lewis, supra, into that case. The real issues in Armor v. Lewis are not in this case, nor were they (on the record) in the case of Fields v. Jacobi, supra. On the facts found in the instant case Levi Marler was the owner of forty acres of cheap land as a homestead. Me transferred this land to his sister. The sister transferred it to one Coleman, who knew that Levi Marler was indebted. The sole question is whether or not a homesteader can convey good title to the homestead proper (not to the surplus, because there was none) when he has a creditor, without being subjected to a charge of fraud in such conveyance. The question has been so often and so fully answered by this court, that the citation of the cases is a useless act. It will be time enough to discuss the doctrines of Armor v. Lewis, supra, when we reach a case involving them. They are not in the instant case, as a casual reference will show. Woodson, J., concurs in these views.

BOND, J.

(dissenting) — I dissent from the views expressed by the learned Commissioner in the opinion adopted in the above case in Division Number One.

The learned Commissioner holds in that case that the sale, under execution, of land subject to a homestead, is wholly void. To this I cannot agree. That it was void as to the homestead, nobody doubts; but that it was void as to the remainder interest in the lands, beginning after the cessation of the homestead, cannot, in my opinion, be sustained in reason under the terms of the applicatory statute. I think the ruling should have been that as to the homestead itself and the entire interests arising therefrom, the sale was a nullity; but as to the remainder estate, after the lapse of all homestead rights, the sale carried the title and subjected it to the payment of the debt upon which the execution and sale was had.

My reasons are set forth in extenso in my dissenting opinion in the - case of Armor v. Lewis, 252 Mo. l. c. 584, et seq. I think the contrary view was incorrectly ruled by Court in Banc in the principal opinion in that case. Subsequently two members of Division One háve held the argument in the dissenting opinion to be sound (Fields v. Jacobi, 181 S. W. l. c. 69), where, upon the presentation of a similar point, Blair and Bond, JJ., concurred for the reasons stated in the dissenting opinion in Armor v. Lewis. In view of that action I dissented from tlie ruling recommended by the Commissioner in the present case, in order that the matter might be re-examined by the Conrt in Bane.-


author: BOND, J.

text:
    THE STATE ex rel. CITY OF MARSHALL v. GEORGE E. HACKMAN, State Auditor.
    In Banc,
    May 17, 1918.
    1. MANDAMUS: Discretion of Court to Issue. Mandamus is a civil remedy provided by law in certain cases, and it is as muck error to refuse it when warranted by all the facts and circumstances held in judgment as it would be to refuse a lawful remedy for any other infracted legal right. Such a refusal in either case would be an abuse of judicial power and discretion.
    2. ELECTRIC LIGHT: Power of Cities to Purchase Plant. The various statutes, when read in pari materia, authorize cities to incur indebtedness for purchasing as well as constructing electric light plants.
    3. -: -: Additional Pive Per Cent. Section 9664, Revised Statutes 1909, is a practical rescript of Section 12a of Article 10 of the Constitution, and was intended to enlarge the power granted to cities to acquire electric light plants and other public utilities; and said Section 12a provides for increasing the limit of indebtedness authorized by the original constitutional provision to an additional five per cent of the assessed valuation of the taxable property in a city above the previous five per cent permitted by the former constitutional provision.
    4. -: -: Indebtedness Within Limits of Additional Pive Per Cent. It was not the intent of amendatory Section 12a to Article 10 of the Constitution, to forbid a city to issue bonds unless the indebtedness to be secured was an amount beyond the five per cent originally permitted to be incurred and within an additional five per cent. The purpose was to give to the city the power to incur an indebtedness for the purposes named in the amendatory section in any amount which does not exceed the aggregate of the ten per cent specified, whether for the purpose of purchasing or constructing electric or other light plants.
    5. CONSTITUTIONAL CONSTRUCTION. Provisions of the Constitution, like statutes dealing with a single subject, must be interpreted according to the plain meaning of the language employed and the paramount purpose of its framers to provide a rational, congruous and symmetrical chart of government.

      6. CITY INDEBTEDNESS: Time for Election. An election by a city of the third class, held for the purpose of authorizing the city to issue bonds for the purpose of purchasing or constructing an electric light plant, is not required to be held on the first Tuesday in April. It may be a special election, and held, in accordance with proper city ordinances, on a date different from the date of the general election for elective officers.
    7. -: Manner of Holding Election: Irregularities: Absence of Eraud. The manner of holding an election to authorize a city to incur an indebtedness for the purpose of purchasing an electric light plant is prescribed by the Australian Ballot Law; but absent fraud or a mandatory statute, irregularities in the method of voting, such as relate to furnishing booths, the duties of the judges of election and the certification of the result, are not substantial violations of that law, and do not invalidate the bonds.
    8. -: Illegal Voters. An election by a city to incur an indebtedness for the purpose of purchasing an electric light plant will not be held void because some of the voters were disqualified, if after the elimination of all such voters, there still remains a majority of two-thirds in favor of the proposition.
    9. -:-: Raised in Mandamus or by State Auditor. In a mandamus proceeding brought by a city against the State Auditor to compel him to register bonds voted by a city for the purpose of purchasing or constructing an electric light plant, a contention that some of the voters were disqualified and for that reason the election was void, cannot be considered. A mandamus proceeding is not an election contest, and the questions that certain votes at the election were disqualified by conviction of crime or non-residence are triable only in election contests. Neither do the statutes prescribing the duties of the State Auditor in the matter of the registration and certification of municipal bonds authorize him to raise or determine such questions.
    Mandamus.
    Writ granted.

      Richard L. Goode, William T. Bellamy and Virgil V. Huff for relator.
    (1) The city of Marshall has been given direct statutory power, to erect or acquire by purchase, and maintain and operate .an electric light plant. The power is conferred on the city council of any oity,. town or village in the State. R. S. 1909', sec.- 9904. And it is conferred by another statute on cities of the third class and those under special charters and with less than thirty thousand inhabitants. R. S. 1909, seo. 9914. And by still another section, the power is conferred i by fair implication on any city in the State, which has not more than thirty thousand nor less than two thousand inhabitants. R. S. 1909, sec. 9664. See also Section 9238, which empowers cities of the third class to pro-, vide for street lighting by contract, etc. (2) To enable cities to carry out the power thus conferred, authority to contract a debt by the issue of municipal bonds to be discharged by taxation, is likewise conferred. R. S. secs. 9544-9648, 9914, 9664. These statutes authorize cities to exceed the limitations on municipal indebtedness provided for in Section 12, Article 10, of the Constitution; but the city of Marshall does not need to exceed the original limitation in the Constitution. Its total debts, including this issue of bonds, will not exceed that limitation. (3) The election upon the question of Issuing the bonds was lawfully held on June 26th, and was not required to be held on the first Tuesday in April, the day fixed by statute for the election of city officers. R. S. 1909, sec. 9545. (4) The statutes that are in pari materia upon the question of by whom the votes cast at special elections, upon the proposition to incur a municipal debt, shall be counted, canvassed and the result ascertained and declared, plainly entrust these tasks to the city council, and not to the city clerk, assisted by two justices of the peace or two county court judges, after analogy to the work of county clerks in ascertaining general election results under Secs. 5911, 5912, R. S. 1909. See Sections 9545, 9546, R. S. 1909, relating to special bond elections and Section 9145 relating to elections in third class cities. Those statutes provide specially for the returns of a bond election to be sent to, and the result ascertained by, the city council, just as Section 6145 et seq. provides specially for those matters in general elections in cities of more than one hundred thousand inhabitants. It is a rule of statutory construction. that enactments specifically regulating a particular matter, are controlling as against general enactments. , In the following eases the statement of facts and the opinions show the same method was observed as in the case at bar to ascertain and declare the result of the election (i. e. by the city council.) Such has been the unchallenged custom. State ex rel. v. Wilder, 2001 Mo. 97; State ex rel. v. Gordon, 217 Mo. 103 ; State ex rel. v. Finley, 74 Mo. App. 213. (5) The law in respect of secrecy of the ballot was substantially observed. Whatever irregularities .occurred in this regard were confined to the ward poll and were due to the inadvertence of some of the voters, not to the city of Marshall, nor the election, officials. Booths were provided but some voters chose not to use them. No general or fraudulent disregard of the policy of the law, such as would justify annulling the election, occurred. Skelton v. Ulen, 217 Mo. 383; Hall v. Schoeneke, 128 Mo. 661; Mills v. Meen, 19o Mo. App. 306; Patton v. Walkins, 131 Ala. 387, 80 Am. St. 43; Morgan v. Van Deventer, 12 Wash. 377, 50 Aim. St. 90; Oonaty v. Gordon, 75> Conn. 46; Perry v. Hackney, 11 N. D. 148. (6) If one or two of the substitute judges were appointed irregularly (that is without the consent of the voters present), which we deny, this circumstance would not vitiate the election even in the precincts where it' occurred. They were de facto officers at any rate, and their authority is not questionable collaterally. State v. Swearingen, 128 Mo. App. 614; Sanders v. Lacks, 142 Mo. 255; Trust Co. v. Morganfield, 96 Ky. 568; Well v. Taylor, 5 Mont. 202; People v. Cook, 8 N. Y. 67, 59 Am. Dec. 451; McCraw v. Harrelson, 44 Tenn. 34; State v. Brien, 38 N. W. 368; Kirkpatrick v. Viekers, 24 Kan. 368. (7) Presence of outsiders in polling places while some of the ballots were counted is no ground for'setting aside the election; see Skelton v. Ulen, 217 Mo. 383; Roberts v. Calver, 98 N. C. 380. Fraudulent irregularities not shown to affect result, do not annul vote unless a statute so declares. 18 Am. Dig., p. 319; 9 R. O. L. 197, and cases in note 17; 9 R. C. L. 1092, and cases in notes 11 and 12. (8) Practically nothing was proved as to the form in which the returns were sent in to the council by the election officers not being according to the statutes. Failure of the judges and clerks to certify the poll hooks, had such failure occurred (and it did not), would not have been fatal to the vote of a precinct. Laughlin v. Kirk-wood, 107 Mo. App. -319, 320; State v. Siller, 24 Kan. 13. Irregularities of this kind are never cause for annulling an election or the vote of a precinct. Paine on Elections, secs. 581, 585, 595, 600; Noward v. Shields, 16 Ohio St. 184; Richardson v. Ramy, 1 El. 224; State v. Siller, 24 Kan. 13; Johnson v. Oole, L. H. R. 36. The statutes (Australian Ballot Law) were substantially observed in holding the election. Proper notice was given of the date and polling places, and whatever deviations from the law occurred, neither changed the result nor threw it into uncertainty, nor were due to any fraudulent purpose on the part of the city. Nor were there any deviations from the law of a kind that the statutes say shall render an election void. A few illegal votes were cast, but the simplest' calculation shows .these could not have changed the result. Some voters refused to observe secrecy in preparing their ballots, but every opportunity was afforded them to do so. No authority can be found which would set aside the result on account of these derelictions on the part of the voters. (9) It is not lawful in this case to investigate the legality of votes cast with reference to the residence or qualifications of voters, and this for two reasons: the issue is not within the scope of the pleadings, nor is such matter competent to be inquired of in a proceeding against the Auditor to compel registration of bonds, but only in an election contest. And if the statutes provide for no contest the decision of the election judges as to such question, as shown by the election returns, is final. That is, no inquiry can be had. State ex reí. v. Dillon, 87 Mo. 487; State ex rel. v. Francis, 88 Mo. 557; Kehr v. Columbia, 136 M!o. App. 322; State v. Gamma,, 149 Mo. App. 694; State ex rel. v. Spencer, 164 Mo. 34. In collateral proceedings, evidence to contradict the returns is not competent. State ex rel. v. Dillon, 87 Mo. 487; State ex rel. v. Francis, 88 Mo. 557; State ex rel. v. Elkins, 130 Mo. 90. The functions of election judges in deciding upon the qualifications of voters and their right to vote are judicial in character, and for this reason also may not Be collaterally attacked, except for fraud, not alleged in this cause. McGown v. Gardner, 186 Mo. App. 484; Blake v. Brothers, 79 Conn. 676, 11 L. R. A. (N. S.) 501.

      Frank W. McAllister, Attorney-General, 8. P. Sowell, Assistant Attorney-General, and Fordyce, Holliday & White for respondent.
    (1) The writ of mandamus is not a writ of right. Its issuance rests in the discretion of the court. State ex inf. v. (Gas. Co., 254 Mo. 531; State ex rel. v. Wilder, 211 Mo. 319. (2) It was the duty of the State Auditor to determine whether all the conditions of the laws of the State had been complied with in the issuance of the bonds. Sec. 1275, R. S. 1909; Hoff v. County, 110! U. S. 53; State ex rel. v. Gordon, 251 Mo. 311; Thornburg v. School District, 175 Mo. 12; Evans v. McFarland, 185 Mo. 703; State ex rel. v. Gordon, 268 Mo. 326. (3) The conditions of the laws had not been complied with in the issuance of the bonds in question, for the election at which the people of Marshall were alleged to have voted in favor of the bonds was illegal and void because: (a) The election was not held on the day required by law. Secs. 9545, 9546, 9145, R. 'S. 1909; Ordinance No. 9 of the City of Marshall ; Sec. 8057, R. S. 1909; State ex rel. v. Jenkins, 43 Mo. 265; State ex inf. v. Dabbs, 182 Mo. 366; State ex rel. v. Ellison, 271 Mo. 129. (b) The city of Marshall, a city of the third class, has no authority, under the law of the State, to issue and sell bonds for the purpose of purchasing an existing electric light plant. Sec. 9914, E. S. 1909, as amended Laws 1911, p. 352: Secs. 9238, 9545, E. S. 1909; State ex rel. v. Wilder, 200 Mo. 104; Hazelhurst v. Mayes, 96 Miss. 606. (c) The election was not conducted in accordance with the Australian Ballot Law, in that persons no't qualified to vote, persons not residents of the city of Marshall, persons residing in a ward of the city other than that in which they voted, were all permitted to cast their ballots and the’ secrecy of1 the ballot was not protected. Chapter 43, E. S. 1909; G-aston v. Lamkin, 115 Mo. 20; State ex rel. v. Seibert, 116 Mo. 418; Miles v. Macon, 193 Mo. App. .306, 269 Mo. 151; Ordinance No. 9 of the City of Marshall, see. 4; Sec. 5800', E. S. 1909'; Hall v. Schoenecke, 128 Mo. 670; Lankford v. Gebhard, 130 Mo. 634. (4) The commissioner erred in refusing respondent’s request that the ballots cast at the election he produced and examined. Sec. 3, Art. 8, Mo. Constitution; Secs. 5905, 5939, R. S. 1909; State ex rel. v. Thurman, 267 Mo. 546; Gantt v. Brown, 238- Mo. 571.
   BOND, J.

I. In this case it is stipulated that the petition for mandamus is to he treated as and for the alternative writ ordered by this court. The object of the suit is to compel the State Auditor to register bonds of the city of Marshall for $75,000, which were authorized at a special election held on June 26, 1916, to raise funds wherewith to build or buy an electric light plant to serve the city and its inhabitants.

The case was referred to a commissioner to take proof and report, which not having been made, a stipulation dispensing therewith and submitting the case on the evidence adduced before the commissioner, was filed March 4, 1918, with' leave to furnish briefs thereafter.

It is conceded in the brief of respondent that the narrative of the evidence in relator’s, brief is, in the main, fair and correct. It is, however, insisted that a peremptory writ should not issue. While many grounds for that contention are set forth in the return of respondents, only those urged in his brief and written argument need be ruled. In substance these are: first, that the city of Marshall had no statutory authority to issue bonds to purchase an electric plant; second, that the special election authorizing the bonds was not held on the day required by law; third, that the election was illegal because not held in conformity with the requirements of the Australian ballot system. [R. S. 1909, secs. 5889-5923- and 5921.]

The foregoing are the only objections to the registration of the bonds relied on in the brief. They will be considered in order. Before doing this, however, it is well to note a preliminary point urged in the brief of respondent, that the writ invoked is not one of right, but is one which is rested in the discretion of the court. As to this contention, it need only be said that the true principle is, that mandamus is a civil remedy provided by law in certain cases, from which it necessarily follows that it is as much error to refuse it when warranted by all the facts and circumstances held in judgment, as it would be to refuse a lawful remedy for any other infracted legal right.

Such a refusal in either case would be an abuse of judicial power and discretion and would be correctable if an appeal or writ of error would lie. The specific redress provided by law for a violation of civil rights is ex debito justitiae and is not left to the unreviewable discretion of any court or judicial officer; for that would be repugnant to the spirit and philosophy of the law and genius of free government, neither of which could tolerate autocracy of administration in any sphere of service. In forms of government of which ours is the most advanced protagonist, the sole repository of supreme power is the law of the land, which decides only after a hearing and trial and must decree evenhanded justice to every human being. Such a state could not exist if its legal or governmental policy were vested in the unregulated discretion of any agent. In a free country a judge may apply, he cannot make the law.

II. Recurring to the vital questions in the case, the relator is a city of the third class and is invested with express statutory authority “to , , . ; . erect or to acquire by purchase or otherwise . . . electric light and power plant . . . to provide for the erection or the extension ^of the same by the issue of bonds therefor, and any such city . . . which may own ... or which may hereafter acquire by purchase . . . any of the plants, systems or works mentioned in this section, is hereby authorized and empowered to establish . . .. a hoard of public works” to take charge of and exercise control over such public utilities. [R. S. 1909, secs 9914, 9917; later re-enacted in substance, Laws 1911, p. 352.]

In addition to the express power given to cities specified in the section (R. S. 1909, sec. 9914; Laws 1911, p. 352.) the power to erect or buy electric light plants is given to all cities of the State by a distinct provision of the statutory law. [See R. S. 1909, sec. 9904.] To exercise these specific and general powers, statutory and constitutional provisions have been enacted and adopted which, by inter-relation, cover the entire subject and prescribe the method by and the extent to which the municipalities shall become indebted. When read in pari materia these sections plainly show that the cities, towns and villages of the State may incur indebtedness for purchasing as well as for constructing-electric plants. For example: Section 9544, Revised Statutes 1909, authorizes them to become indebted for charter purposes, or when authorized so to do “by any general law of the State,” etc. Aind Section 9904, by a general law of the State, empowers them “to acquire by purchase” electric plants. Hence it is clear that the two sections pf the statutes dovetail with each other and afford full statutory power on the part of relator to contract the indebtedness in question, either to build or to buy an electric plant. Again, Section 9664 is a practical rescript of Section 12a of Article 10 of the Constitution (State ex rel. v. Wilder, 200 Mo. l. c. 105) and was intended to enlarge the power granted (in Section 12, Article 10, of the Constitution) municipalities to acquire electric plants and all other public utilities. This amendatory provision of the Constitution provides for increasing the limit of indebtedness authorized by the original provision to an additional five per cent of the assessed value of the taxable property of the cities above the previous five per cent permitted in the former provision of the Constitution. The latter provision of the Constitution further amends the former by providing that the indebtedness thus permitted to be - increased shall be usuable “for the purpose of purchasing or constructing . . . electric or other light plants.” It would be a narrow, if not absurd, view of this amendment to hold that it did not intend to authorize the creation of an indebtedness for purchasing. such a plant, unless the city in order to do so would have to avail itself of the five per cent additional taxation which the amendment gave it the power to levy. The obvious design of the amendment of the Constitution was to foster municipal ownership’ by increasing the amount of public indebtedness for the acquisition, whether _ by erection or purchase, of. the' great necessaries of urban life and to grant power to cities to become indebted for that purpose in any sum not exceeding a total of ten per cent of the assessed value of their property to be ascertained as provided in the original provisions of the Constitution, to-wit, Section 12 of Article 10. It was not the intent of the new section to forbid a city to issue bonds unless the indebtedness to be secured was for an amount beyond the five per cent originally permitted to- be incurred and within an additional five per cent; but it was the manifest purpose of the amendatory provision of the Constitution to give to such cities the right to exercise the powers and franchises therein granted in any case where the indebtedness, whatever its amount, did not exceed the aggregate of ten per cent specified in the amendatory provision. Any other theory of the purposes of the 'amendatory provision would be inconsistent with its language and object and in contravention of the established cannon of construction that provisions' of the Constitution, like statutes dealing with a single subject, must he interpreted according to the plain meaning of the language employed and the paramount purpose of its framers to provide a rational, congruous and symetrical chart of government. [Calland v. Springfield, 264 Mo. l. c. 301, 302.]

The clear and explicit grant of powers contained in the statutes and Constitution heretofore cited, leave no room for doubt that the city of Marshall had the statutory power to incur the indebtedness evidenced by the issuance of the bonds in question, under the facts in this record, which show that it did not exceed the constitutional proportion of the assessed value of its property ascertained as provided in the Constitution, at the date of the execution of itp bonds, provided the election, was legally held and the proposition to increase the indebtedness was legally carried. proper authorities, “shall order a special election to be held” upon prescribed notice; that “such election shall be held and judges thereof appointed as in ease of other elec-

III. The election was held at a time contemplated by law. Section 9545, Revised Statutes 1909', among other things provides that a city, town or village desiring to submit to its voters the question of the issuance of bonds like those under review, through its tions in such municipalities.” Section 9546 prescribes the form of the ballots; Section 9145 provides “a general election for the elective officers” of cities of the class of relator “shall be held on the first Tuesday in April . . . and every two years thereafter.” In accordance with the latter of these sections, Ordinance 99 of the City of Marshall, so far as pertinent, provided that -“on the first Tuesday in April, 1906,” and biennially thereafter “a general election” should be held in that city as prescribed by law for mayor, marshal, city attorney, police judge and other city officers. It is the theory of the learned counsel for respondent that. the foregoing statutes and ordinances by cross-reference imply that the “special election” provided in the first section above quoted must be held on the date fixed for “general elections” in the relator city. We are unable to concur in that view. The only necessary intendment of the statutes and ordinance supra is that the date for the holding of “general elections” in the city of Marshall must take place biennially on the first Tuesday of April. There is nothing in the language of these statutes and ordinance which necessarily implies that “special elections” which cities like the relator are authorized to call for the purpose of incurring municipal indebtedness, should be held on the fixed date prescribed by law and ordinance for the election of officers of such cities. The provision with reference to such special elections (viz., such elections shall be held and the judges thereof appointed as in case of other elections in such municipalities, R. S. 1909, sec. 9545, supra) only requires similarity ás to the method and manner of holding the two kinds of elections; it does not necessarily imply that they can only be held on the same date. Such a construction is not demanded by the terms of the statutes and would result in much inconvenience and delay in the exercise by such cities and towns of their lawful rights to erect or purchase public utilities indispensable for the public welfare. In cases wherein this court has passed upon the exercise of such powers, it was not thought indispensable that such elections should be held on the date prescribed by law for general elections in such towns and cities. In a recent deliverance by this court In Banc (State ex rel. City of Memphis v. Hackman, 273 Mo. 670) it appeared that an election for the identical purpose of the one under review was held on February 28, 1916. In that case a peremptory writ of mandamus was awarded to compel the registration of bonds. So also in the following cases the elections of the kind under review were held at other dates than those prescribed by law for the holding of general elections: State ex rel. Carthage v. Gordon, 217, Mo. 103; State ex rel. Dexter v. Gordon, 251 Mo. 303; Bauch v. City of Cabool, 165 Mo. App. 486.

In the case of State ex rel. Dexter y. Gordon, 251 Mo. 303, neither in the majority nor in the dissenting opinion was any importance attached to the fact that the election then under review was held in August and not on the first Tuesday in April. The effect of these rulings, particularly the one in State ex rel. Dexter v. Gordon, supra, where a mandamus to compel the registration of bonds was denied, is equivalent to a. holding that the statutes supra were not susceptible of a construction requiring a special election for the issuance of bonds to be held on the date of the general election, for if that had been the proper interpretation of the statutes, the ruling in the case of State ex rel. Dexter v. Cordon, supra, would have been placed on the ground that the issuance of the bonds was void because voted for at an election held on a date other than that required by law. No such conclusion was reached in that case and if it had been' permissible there would have been no occasion for the dissenting opinion filed in that ease. We therefore overrule the contention that the election for the issuance of the bonds involved in this proceeding was held on an improper date.

IV. We think the proposition to incur the indebtedness was lawfully carried at the election held for that purpose. We concede that the manner of holding the election under review is prescribed by what is known as the Australian Ballot Law (Art. 5, Ch. ^3, R. S. 1909). A careful consideration of the relevant testimony in this case satisfies us that in its essential features this election code of the State was substantially complied with and that the result of the election showed a two-thirds majority of those voting in favor of the proposition to incur the indebtedness evidenced by the bonds sought to be registered. Many of the points urged in favor of the contrary view by the learned counsel for respondent, while specifically different, were not generically unlike the objections urged to the registration of the bonds in the unreported manuscript decision of State ex rel. City of Memphis v. Hackman, supra. The effect of the doctrine announced in that case it that, absent fraud or a mandatory statute, an election like the one under review will not be set aside for mere irregularities in the method of voting, such as relate to furnishing booths, the duties of the judges of election and the certification of the result of the election. [See also Bine v. Jackson Co., 266 Mo. l. c. 240; Bowers v. Smith, 111 Mo. 45, and Skelton v. Ulen, 217 Mo. 383.] Under the authority of State ex rel. v. Hackman, supra, we are not prepared to say that the complaints of the respondent in these respects involve substantial violations of the- Australian Ballot Law, and accordingly overrule the assignment that such law was contravened in the election in'the instant case.

V. It is finally urged by the learned counsel for respondent that the election in this case was void because twenty-six illegal votes were east thereat by persons not entitled, on account of non-residence and other legal disqualifications, to participate in the election. A careful examination of the testimony discloses that the result of the election would not' be affected if these votes “were subtracted from those given in favor of incurring the indebtedness, since that would leave more than a two-thirds vote cast in favor of the- proposition. The total of the votes cast was 1251; 857 being for bonds and 394 against. It is evident that if 26 be deducted from those favoring the bonds, a two-thirds majority would remain. But the question is not before us in this case. Respondent sought to amend its return by specifying these grounds for annulling the election.. This court denied that motion for the reason that no such' issues can be raised in a mandamus proceeding to compel the. registration of bonds. Such a proceeding is not an election contest in -any sense. The duties of the State Auditor in the matter of the registration of bonds of municipalities are regulated and prescribed in Section 1275, Revised Statutes 1909, which provides, among other things, for the registration of municipal bonds in the same manner State bonds are registered and for a certificate endorsed by the Auditor on the bonds “that all conditions of the laws have been complied with in its issue, if that be the case, and also that the conditions of the contract under which they were ordered to be issued have also been complied with, and the evidence of that fact shall be filed and preserved by the Auditor; but such certificate shall be prima-facie evidence only of the facts therein stated and shall not preclude or prohibit any person from, showing or proving the contrary in any suit or proceeding to test or determine the validity of such bonds, or the power ... to issue such bonds; and the remedy of injunction shall also lie at the instance of any taxpayer, . . . to prevent the registration of any bonds alleged to be illegally issued and funded under any of the provisions of this article.” ' It is obvious at a glance that the .above statute makes no provision for the contest of an election or for the trial of issues determinable only in a suit to contest an election. It is settled law that election contests did not exist at common law, but are purely creations of statute. Whether or not the twenty-six voters in question were disqualified by conviction of crime or non-residency, would present questions triable in election contests, whenever authorized by statute, but they could not be collaterally inquired of in a mandamus proceeding brought under the above statute to compel the registration of bonds. [State ex rel. v. Dillon, 87 Mo. 487; State ex rel. v. Francis, 88 Mo. 557; State ex rel. v. Hough, 193 Mo. l. c. 643; Kehr v. Columbia, 136 Mo. App. 322; State ex rel. v. Elkin, 130 Mo. 90; State v. Gamma, 149 Mo. App. 694.]

Our conclusion . is that upon the presentation of the bonds to the State Auditor, under the circumstances and facts of the present record, a prima-facie showing was made that they had been issued in compliance with' the conditions prescribed hy law, and that it was his specific duty to have registered them in the manner prescribed in the above statute.

It follows that the alternative writ of mandamus heretofore awarded is made permanent. It is so ordered.

Walker, Woodson and Williams, JJ., concur; Graves/ G. J., and Blair, J., concur in paragraphs 2, 3, 4 and 5 and the result; Baris, J., dissents.


author: RAILEY, C.

text:
    CITY OF ST. JOSEPH v. GEORGE H. WYATT, UNITED STATES FIDELITY & GUARANTY COMPANY et al., Appellants.
    In Banc,
    May 17, 1918.
    LIMITATIONS: Defaulting City Treasurer: Liability of Bondsmen: Concealment. The surety on the bond of a city treasurer, who had appropriated the city’s money more than three years before suit was brought, and whose books it was the duty of the comptroller and auditor, both by ordinance and statute, to examine, and whose cash on hand it was the duty of the comptroller to count and see that it corresponded with his own books as well as those of the auditor and of the treasurer, and which duties were not performed, but wholly neglected, although the comptroller’s attention was by his deputy called to the great amount of cash which the treasurer’s reports showed he had on hand as being suspicious and requiring counting, is not liable for the treasurer’s defalcation. There was no such diligence to discover it as prevented the three-year Statute of Limitations (Sec. 1890, R. S. 1909) from running.
    Appeal from Buchanan Circuit Court. — lion. Thomas B. Allen, Judge.
    REVERSED AND REMANDED (with directions).

      Culver & Phillip, for appellant United States Fidelity & Guaranty Company.
    The court erred in holding that the three-year Statute of Limitations did not apply in this case and in refusing defendant’s instruction which so declared. Secs. 1890, 8582-4, R. S. 190:9; Shelby County v. Bragg, 135 Mo. 291; Adams v. G-ossom, 228 Mo. 566; State ex rel. v. Yates, 231 Mo. 276; Johnson v. United Railways, 243 Mo. 278 ; Putnam County y. Johnson, 259' Mo. 73; State ex rel. v. Harter, 188 Mo. 516; State ex rel. v. Stonestreet, 92 Mo. App. 214.

      McCabe Moore and William E. String fellow for appellant American Fidelity Co.

      Charles L. Faust and Perry A. Brubaker for respondent.
    The three year Statute of Limitations does not apply in this case because the facts pleaded and proven clearly bring it within the exception. The authorities are unanimous, that the Statute of Limitation does not begin to run where fraud and deception have prevented discovery. State ex rel. v. Gates, 231 Mo. 276; Putnam County v. Johnson, 259 Mo. 73; Johnson v. United Railways, 243 Mo. 278; Shelby County v. Bragg, 135 Mo. 291; State ex. rel. v. Hawkins, 103 Mo. App. 254. Even the negligence of other officers in failing to discover shortage is no defense. State v. Atherton, 50 Mo. 210; Town of Hudson v. Miles, 71 N. E. 63. Laches is no defense when fraud is not discovered. The duty to commence proceeding arises only upon discovery. 2 Pomeroy Equity Jurisprudence, sec. 917, p. 1648. Sureties cannot claim laches. State v. Powell, 8 Am. St. 522.
   RAILEY, C.

On September 2, 1914, plaintiff, a city of the first class, sued George H. Wyatt, the United States Fidelity & Guaranty Company and the American Fidelity Company, to recover of Wyatt, as treasurer of the city of St. Joseph, and said companies as sureties on his official bonds, an alleged shortage of $30,341.51. The case was disposed of by the trial court as a proceeding in equity. Hon. L. A. Vories was appointed master in chancery to hear the evidence, and report his findings of fact and conclusions of law. After hearing the testimony the master made his report to the court, which was confirmed by the latter, and judgment entered for the penalty of the various bonds given by Wyatt, as city treasurer, to be satisfied on payment by the defendant, the United States Fidelity & Guaranty Company, of sums aggregating $21,942.46, and by the American Fidelity Company of the sum of $4429.09.

It appears from the record that Wyatt was elected and served as treasurer of said city for four years from April 16, 1906, during which period the United States Fidelity & Guaranty Company was surety on his bond, as treasurer aforesaid, in the penal sum of $50,000. It appears that Wyatt was again elected treasurer of said city for a period of two years from April 15, 1910.

The master found — and the evidence shows — that:

“The amount of money misappropriated by Wyatt during a period extending from April 16, 1906, to September 2, 1911, was $16,431.69, which represents the sum for which the United States Fidelity & Guaranty Company disclaims liability because of the running of the three-year Statute of Limitations, this suit having been brought and filed September 2, .1914.”

Both of the surety companies aforesaid filed their respective motions for a new trial and motions in arrest of judgment. All of said motions were overruled and both of said defendants appealed to this court. The American Fidelity Company dismissed its appeal in this court. On the record before us, it becomes our duty to determine whether the remaining surety company is liable for the shortage of $16,431.69 aforesaid, or whether said demand is barred by virtue of the provisions of Section 1890, Revised Statutes 1909.

Such other matters appearing of record, as may be necessary, will be considered in the opinion.

I. This action was brought against Wyatt, as treasurer of plaintiff, and the two corporations as his sureties. The American Fidelity Company dismissed its appeal in this court. The evidence shows, and it is conceded by the United States Fidelity & Guaranty Company, that from September 2, 1911, to April 15, 1912, while said last named company was surety for Wyatt, the latter misappropriated $1719.49 of funds belonging to plaintiff. The evidence also shows, and it is conceded by the United States Fidelity & Guaranty Company, that from April 21, 1913, to February 12, 1914, when Wyatt resigned,, he misappropriated $3742.28 of funds belonging to plaintiff; that the total amount misappropriated by Wyatt, after September 2, 1911, while the above named Guaranty Company was his surety, amounted to $5461.77.

On page 26 of said company’s brief, it is said: “This defendant admits its liability for this amount and made the same admission before the master, and the trial court.” On page 9, of the Guaranty Company’s brief, it is said: “This defendant made no. claim below, nor does it here, that it is not liable for all moneys embezzled during that part of the three years preceding the bringing of the suit when it was surety on Wyatt’s bond. It did insist below, and does here, that it is not liable for shortage occurring before that period, because barred by the three-year Statute of Limitations.”

The evidence shows, and the master found, that Wyatt, as treasurer, between April 15, 1906-, and September 2, 1911, while the United States Fidelity & Guaranty Company was its surety, misappropriated $16,431.69. If the above demand is found to be barred by Section 1890, Eevised Statutes 1909, it would necessitate a reversal and remanding of the cause.

In view of the foregoing and the elimination of the American Fidelity Company, as appellant herein, we do not deem it necessary to consider, or determine, whether the petition states a good cause of action in equity, nor whether there was an improper joinder of parties defendant, or of different causes of action therein.

II. It is contended by tlie United States Fidelity & Guaranty Company that plaintiff’s demand as to said shortage of $16,431.69, which1 occured more than three years prior to the commencement of this action, is barred by the provisions of Section 1890, Revised Statutes 1909, which reads as follows:

“Within three years: First, an action againsjt a sheriff, coroner or other officer upon a liability incurred by the doing of an act in his official capacity and in virtue of his office, or by the omission of an official duty, including the non-payment of money collected upon an execution or otherwise; second, an action upon a statute for a penalty or forfeiture, where the action is given to the party aggrieved, or to such party and the State.”

We are clearly of the opinion that the liability of the Guaranty Company for the payment of said sum of $16,431.69 must be determined under the above section, in connection with the facts of the case. The burden of proof devolved upon plaintiff to show a state of facts which prevented said statute from running against it. The quantum of proof necessary under such circumstances is fully discussed in Shelby Co. v. Bragg, 135 Mo. l. c. 298, and following; Callan v. Callan, 175 Mo. l. c 360-1-2; State ex rel. v. Harter, 188 Mo. 516; State ex. rel. v. Yates, 231 Mo. 276; Johnson v. United Railways, 243 Mo. l. c. 298, and following; Putnam County v. Johnson, 259 Mo. 73.

The master, in his rep-ort, correctly said:

“In this case our charter provides for a system of triplicate receipts, under which the city comptroller and auditor each have a. complete record in their offices of all moneys received by the city treasurer, and as all warrants for the disbursement of money must be drawn by the auditor and countersigned by the comptroller, each office must have a complete record of all disbursements made by the treasurer. The treasurer makes a daily and monthly report to the comptroller of all receipts and expenditures, together with' money on band, and where. The comptroller thns has a daily and monthly check upon the treasurer, and it is his duty to examine these reports and compare them with his own hooks, and if any discrepancy is found to have the same corrected, which the comptroller constantly" did. ”

The further statement of the master in his report, is sustained by the testimony:

“An actual count of the money in the office of the city treasurer at any time during Wyatt’s incumbency of this office would have disclosed a discrepancy between the vault balance, as shown by the cash-journal and the reports made by the city treasurer to the 'comptroller, and the cash balance actually in the office, which' discrepancy would be the true shortage. An examination was not made of the treasurer’s cash or vault balance by the comptroller or anyone for the city, though at one time, in the latter part of October, 1912, a deputy comptroller, then recently, appointed, suggested that it should be done. The comptroller did not make the examination, as he had been advised that he had no authority to do it. . . .
“During Wyatt’s various terms of office, the city comptroller, in addition to the duties imposed upon him by the general laws of the State of Missouri, was required by ordinance to exercise a general supervision over all the offices of the city regarding the proper management of .the fiscal concerns of their respective offices; to,examine the books of each department from time to time and- see that they were kept in proper form; to see that all necessary reports were made to him from the various officers of the city; that officers receiving money paid the same to the city treasurer when required, and report all delinquents to the mayor; to direct the city counselor to take immediate legal measures for the recovery of any default or shortage when any officer of the city should become a defaulter; to make a semi-annual report to the common council as to the financial condition of the city, giving a full detailed account of all receipts and expenditures, and of all liabilities of the city, the amount of money on hand belonging to each of the different funds or departments, the balance, of the money in the city treasury, 'and the sum due and outstanding, the names of all persons who might be defaulters to the city, and the amounts in their hands unaccounted for.”

Shaffer — the former comptroller — testified that none of the reports which Wyatt made to him, were ever signed by the latter.

In respect to cities of the first class, Section 8384, Revised Statutes 1909, reads as follows:

“The comptroller shall have the city comptroller of the collection and return info the treasury and disbursement of all revenue and moneys of the city, of the proceedings therefor and of all property and claims. He shall see that all proper legal proceedings are had to recover, keep and manage such property or other interests; that all proper rules and regulations are prescribed and observed in relation to all accounts, settlements and reports regarding the fiscal concerns of the city; that no appropriation or funds are overdrawn or misapplied, and that no liability is incurred nor money or .property of the city disbursed or disposed of contrary to the spirit of the law or ordinance.”

Ralph Van Houten, deputy city comptroller, introduced as a witness by plaintiff, testified, that he could have taken the "books of the city treasurer, and by counting his cash in the va/ult, have ascertained how he stood ivith the city. He testified, in regard to this matter, as follows:

‘ ‘ Q. In other words, the only thing lacking in your office as deputy comptroller to enable you to tell those conditions was seeing those cash items? A. Yes, sir, verifying the vault balance. . .
“Q. Now, did that excite your supicion? A. Well, it did as soon as I had been down here long enough to get familiar with the bo'oks.
“Q. What, if anything, did you_ do about that? A. Well, I talked it over — I called Mr. Shaffer’s attention to it, and also talked it over with, others down there.
“Q. Well, with whom else connected with the city? A. Well, with the deputy city auditor, and with the man who is now city treasurer — Frank Allen.
“Q. In other words, it was your opinion that that was too large a balance to carry in the vault, and in the second place that it ought to be verified? A. No, I didn’t think there was any shortage; my suspicions were that he was using that money for his personal business, and would put it back at any time; that he was perfectly responsible for it.
“Q. What was it that aroused your suspicion? A. Well, I knew that it was not necessary to carry that much money in the vault; and another thing, that vault is not built to carry twenty thousand dollars; and there would be no necessity for carrying over three thousand, anyway.
“Q. In other words, from the surroundings there and facts as you understood them, you didn’t believe that he had that much money in the vault? A. No.”

It is clear from the testimony, that from the time Wyatt commenced '¿ds treasurer in 1906 up to the time he resigned in 1914 the comptroller of said> city could have ascertained, by counting the cash in the vault, the shortage of Wyatt at any time. He made no effort to obtain any information upon this subject, notwithstanding the suspicious circumstances detailed to him by his own deputy. The manifest purpose of the law in requiring the city treasurer to file with the auditor and comptroller the monthly statements heretofore mentioned, was to furnish them the means of checking up his accounts and ascertaining whether he had on hands the assets necessary to correspond with said statements' and the treasurer’s books. What was the necessity for the comptroller and auditor to keep a.record in regard to the proceedings of the treasurer, unless they were expected to check up his cash balance and determine its correctness? Would the report of a bank examiner stating that he had examined the books of a bank and found them correct, he of any service to the State, in determining the solvency of the bank and the integrity of the institution, if he had admitted in his report that he had failed to count the money and assets of the bank? The comptroller, even when put upon inquiry by the suggestions of his deputy, that the treasurer was using the city’s funds for his own use, made no effort to ascertain the facts, or to take any action in respect to the matter.

This court, in the opinions heretofore cited, has defined what is necessary for the city to show, in a case of this character, to avoid the three-year Statute of Limitations.

In Shelby County v. Bragg, 135 Mo. l. c. 298, speaking through Judge Macfakdaite, we said:

“It cannot he said that the evidence of the facts constituting plaintiff’s cause, of action was concealed or suppressed. The evidence all existed upon the official books and records of the office open to the examination of the court. The expert accountants who afterward made an examination encountered no difficulties in making an account of fees collected. They reported no destruction of books, or the suppression or concealment of no fact which could prevent an accurate statement being made.
“It is insisted that the duty of this officer and his relation to the county court was such that the latter had the right to rely implicitly on the correctness of these statements and that making a statement which did not fully and truthfully account for .all fees collected is such a fraudulent concealment of the facts as would delay the running of the statute. But the county court is required to examine the statements and see that they are correct before approving them; it was not intended that they should accept as true any statement the officer should make. The evidence by which the truth could have been ascertained was at hand and ■open to their examination. .Indeed,, the statements did not all purport to be accurate; they do not pretend to give an itemized account of the fees collected and from whom; they virtually refer the court' to the records of the offices for the evidence.
“The county court is given the power to audit the accounts of these officers and it is made their duty to examine statements made by them and, if necessary, to hear the evidence of witnesses. A mere examination of the statements is not a proper performance of their duty. They should see that the statements are correct. This is particularily so when the statements on their face, as in this case, are not such as the law requires. It cannot be said that the county court was ignorant of facts which were open to its examination, and which it was its duty to Know.
“Statutes of Limitations are favored in the law and cannot be avoided unless the party seeking to do so brings himself strictly within some exception. £A party seeking to .avoid the bar of the statute on account of fraud must aver and show that he used due diligence to detect it, and if he had the means' of discovery in his power, he will be held to have known it.’ [Wood v. Carpenter, 101 U. S. 141; Buckner v. Calcote, 28 Miss. 432; Nudd v. Hamblin, 8 Allen, 130.] A party cannot avail himself of this exception to the statute where the means of discovering the truth were within his power and not used. [Cole v. McGlathry, 9 Me. 131.]”

In State ex rel. v. Yates, 231 Mo. l. c. 286 and following, Judge Lamm, in behalf of this Division, said:

“Attending to the testimony, we shall not cumber the opinion with it. It tends to show that Thomas from month to month reported his pretended receipts and disbursements to the board of managers, transcribing the account fr'om his own books as treasurer and presenting receipts from the State Treasurer showing he had deposited with that official such moneys as his own report and the books showed he had received. The board of managers accepted his report as true and, finding the receipts of th'e State Treasurer to agree with the amounts reported by Thomas, looked no further and allowed Thomas’s peculations to continue systematically during 1897 and 1898. Their excuse for this was that they had implicit confidence in his integrity and took no steps to check up his accounts to see if he h'ad charged himself with all funds coming into his hands. At that very time facts and documents (duplicate receipts) showing systematic and heavy stealing were spread on the very books of the hospital and were in its files, subject to their command for inspection and use. Their bookkeeper kept a set of books as did the treasurer. This bookkeeper was secretary of the board and attended its meetings. It was the duty of the superintendent of the hospital to be present at the meetings of the board of managers and to make reports to the board. The books kept by the bookkeeper show that Thomas had received from time to time many thousands of dollars lie was, in some instances, not accounting for, and, in others, was accounting for long after their receipt. The superintendent, under the evidence, as well as the bookkeeper and ex-officio secretary of the board,, hád handled most of the warrants, checks and drafts evidencing the moneys stolen, and, as said, these amounts appeared on the books of the bookkeeper, and yet neither the bookkeeper nor the superintendent was asked to investigate the state of Thomas’s accounts as spread on the bookkeeper’s books, nor did the board investigate the bookkeeper’s books and compare them with Thomas’s to see if they tallied. ...
“The statutory scheme for the management of the hospital shows in its entirey that its board act, inter alia, as auditors, and diligence- in that behalf is but a main part and parcel of the very body of their duties. If such board is to complacently assume that its treasurer is competent and honest, and is to assume, without looking or inquiring elsewhere than in his own books, that his accounts are true, then the board' is a mere ornamental appendage with perfunctory duties, and its supervision and management are idle formulas, •pertaining to the surface (and missing the heart) of the matter. Nothing is so productive of integrity and care as the knowledge on the part of an officer that his official acts in handling public funds pass under ths vigilant, scrutinizing and impartial eye of an efficient and intelligent hoard of management. To the contrary, nothing is so conducive to slovenliness, inefficiency and dishonesty as that a hoard of managers, with eyes blinded with conventional confidence in its officers, assume as true the very thing they were appointed to seek out and determine, viz., that their treasurer’s books tell the whole truth about the receipts of public moneys. Those who sign bonds, as sureties for treasurers,, sign them in the assurance that superintendents and boards of managers will perform the duties cast upon them by the law.”

The other authorities cited announce the same principles.

Without considering the subject further, we are of the opinion that the comptroller of plaintiff, from April 15, 1906, to September 2, 1911, failed to exercise any diligence whatever in ascertaining the true condition of Wyatt’s financial shortage, when it could have been discovered by simply counting the money and assets in his vault. We hold, that the right of plaintiff to recover the $16,431.69, heretofore mentioned, is barred by Section 1890, Revised Statutes' 1909.

The judgment below, as against the defendant, the United States Fidelity & Guaranty Company, is hereby reversed and remanded with directions to the trial court to set the same aside, as to the above named defendant, and to enter a judgment in favor of plaintiff and against said defendant, for the sum of $5461.77, with interest thereon from September 2, 1914, at the rate of six per cent per annum.

Brovm, G., not sitting.

PER CURIAM: — The foregoing opinion of Railey, C., is adopted as the opinion of Court in Banc.

Graves. G. J., and Wed Jeer, Blair and Williams, JJ., concur; Bond and Fa'ris, JJ., dissent; Woodson, J., not sitting.