National Surety Co. v. Williams

1. An exhibit may by ¡apt words be made a- part of a declaration ex contractu or ex delicto, and where, both parties, as well as the court-below, have.treated such an exhibit as a part of the declaration which may be reached by demurrer, this court will follow the example of the parties and’ the trial Court ¡and likewise so regard it when the case comes here on writ of error. 2. When properly tested by demurrer .or other appropriate procedure, ambiguities in a pleading should be construed against the party in whose interest the ambiguous language is used; yet a court may not be held in error for overruling ■ a demurrer to an ambiguous pleading when such pleading does n'ot put. the opposite party to (a disadvantage, and when , under the allegations or averments of the pleading, a cause of action or a defense may fairly be shown by proper evidence. 3. Stockholders of a corporation may by appropriate action ratify by-laws adopted by the promoters Of such corporp.tion before letters patent were issued and delivered to it. 4. Prior to the adoption of Chapter 6465, Acts of 1913, Laws of Florida, provisions and stipulations contained in valid contracts limiting the time within which suits iould be brought upon such contracts were valid and enforcible. 5. A bond made by a' surety company ¡agreeing to reimburse an employer for any pecuniary loss sustained “by any act of fraud and dishonesty, including larceny or embezzlement, forgery and misappropriation of funds” committed by a • designated employee is in effect a contract of insurance to -which the rules of construction governing ordinary contracts of insurance are applicable. G. The rule for the construction and interpretation of insurance contracts is, that the policy must be liberally construed in favor of the insured so as not to defeat, without a plain necessity, his claim to the indemnity which, in making the insurance, it was his object to secure. 7. A bond made by a surety company agreeing to' indemnify a Ljank against pecuniary loss on account of any fraud or dishonesty of its cashier, if susceptible of two constructions, one favorable to. the bank and the other favorable to the surety company will be given the former construction when such bond was drawn by the attorneys or representatives of the surety company. S'. The bond of a surety company agreeing to indemnify an employer against the default of an employee is to be most strongly construed against the surety. 9. The bond in¡ this case provided that upon “becoming aware of any áct which may be made the basis of a claim” under such bond “the employer shall give immediate notice thereof to the surety at its home office” by telegraph and by registered letter, and within ninety days after the date of such notice shall file with the surety an “itemized claim," under said bond, It further provided that no action to recover ■from'the surety any 'claim - under’ said bond"‘‘should be' brought “unless commenced within a period of twelve months after the date the employer shall' have given notice of chaim.” HELD. Applying the foregoing rule of construction, tb¡at suit may be maintained in such a case when commenced within a period of twelve months after the date upon which the employer has filed with the surety his “itemized claim,” and that such action is not barred because not commenced within a period of twelve months after the date upon which the employer gave notice that he had become aware “of any act which may be made the basis of a claim” under such b'ond. 10. A misappropriation of funds does not necessarily mean a misappropriation of actual cash, because “funds” is a much more comprehensive term and may include other assets or property. 11. When a cashier of a bank puts his note, which is of no value in such bank and issues a certificate of deposit of the bank in a like amount to another in payment to him of the purchase price of property which the cashier is purchasing for himself, the transaction is in legal effect the same as if such cashier had taken the money of the bank and used it in the purchase of such property. 12. Where it is proven that cashier of a bank has “loaned” to himself, without authority, excessive amounts of the bank’s funds, without taking security therefor, and that his bills receivable are considerably .less in their aggregate amount than his bills receivable account carried on the books of the bank, it cannot be said that it has not been proven that he has misappropriated the funds of the bank, and the fact that he placed his worthless notes in the bank for the amount of the funds used or taken by him, does not affect the substance of the transaction, nor change its real character. 13. In order that liability may attach on a bond conditioned to insure an employer against' “fraud and dishonesty, including larceny or embezzlement, forgery and misappropriation of funds” by an employer it is not necessary for the employer to introduce siich evidence as would he necessary to convict the employee of the crime of larceny or embezzlement as defined by the laws of this State. 14. Where separate am'ounts are erroneously included in a judgment a remittitur of the amounts so erroneously included may be permitted in lieu of a new trial

Defendant in Error. Writ of error to Circuit Court of Wakulla County, E. C. Love, Judge. STATEMENT. This action was brought by the defendant in error against the plaintiff in error on a bond given by Alonzo D. Wilder, as principal, to the Sopchoppy State Bank, upon which the National Surety Company, as surety, agreed to reimburse said bank within three months after proof of loss, for any pecuniary loss sustained by it because of the fraud and dishonesty, including larceny or embezzlement, forgery and misappropriation of funds of the said Wilder while in the employ of said bank, during the term commencing on the first day of April, 1912, at 12 o’clock noon • and .ending on the first day of April, 1913, at 12 o’clock noon. The declaration consists of several common counts in assumpsit, and a special count upon the bond. The special count with exhibit B attached thereto and by reference made a part thereof, omitting fora al parts, is as follows: “Alexander H. Williams, as Eeceiver of the Sopchoppy State Bank, a corporation organized and existing under the laws of the State of Florida, and heretofore doing a general banking business in the town of Sopchoppy in' the County of Wakulla in the State of Florida, plaintiff, by authority of the court first had and obtained, sues National Surety Company, a corporation organized and existing under the laws of the State of New York, with its principal office or place of business in the State, County and City of New York, and Alonzo D. Wilder, the defendants, for that: “First. Whereas on the 12th day of April, ,A. D. 1912, the said defendant, National Surety Company, being then and there licensed by the State of Florida, to be and become surety on surety bonds of the class and character hereinafter mentioned in the State of Florida, did for the consideration of the sum of $25.00 to it in .hand paid on the said 12th day of April, A. D. 1912, make and deliver its certain bond, or writing obligatory under seai (a copy of which is hereto attached marked exhibit 'A’ and prayed to be taken as part hereof by reference) in the sum of $10,000.00 lawful money to be paid to the Sopchoppy State Bank to which' writing obligatory under seal or bond of the said defendant Alonzo D. Wilder was a party and that upon the strength, faith and credit of said bond or writing obligatory, under seal, and the covenants and provisions therein contained, the said Alonzo.D. Wilder was taken and kept for the time hereinafter mentioned in the employ of said Sopchoppy State Bank. That in and by said bond, or writing obligatory, under seal, the said defendant, .National Surety Company, did agree to reimburse the said Sopchoppy State Bank as the employer therein named within three months after satisfactory proof of loss for any pecuniary loss sustained by the said Sopchoppy State Bank as such employer by any act of fraud and dishonesty, including larceny or embezzlement, forgery and misappropriation of funds committed by the Said Alonzo D. Wilder, designated in the said bond, or writing obligatory, under seal, as the employee while the said employee was in any position in the service of the said Sopchoppy State Bank during the term commencing on the first day of April, A. D. 1912, at twelve o’clock noon and ending on the first day of April, A. D. 1913, at twelve o’clock noon. It being provided in said bond, or writing obligatory, under seal, that the following conditions should be precedent to any recovery thereunder: “1st. That the employer has no knowledge that the employee has been in arrears or in default in any position whatever; that if the employer or any officer becomes aware of the employee gambling, speculating, or committing any disreputable, lewd or unlawful act, the Surety shall be immediately notified thereof in writing at its Home Office, and that no act giving rise to a claim thereunder shall be condoned, nor any loss settled without the written consent of the Surety first being obtained. “2nd. Upon becoming aware of any act which may be made the basis of a claim hereunder the employer shall give immediate notice thereof to the Surety at its Home Office by telegraph at Surety’s expense and by a registered letter, and within ninety (90) days after the date of said notice, file with the Surety an itemized claim hereunder duly sworn to, and upon request produce for investigation all books, vouchers and evidence which the Surety may require, and lend every assistance to bring the employee to justice. “3rd. Should the employer and Surety disagree regarding the amount of loss sustained hereunder for which the Surety may be liable, the matter may be arbitrated at the election of the employer through arbitrators consisting of one person appointed by the employer, and one person appointed by the Surety. These two shall select a third person and the decision of the majority of said persons shall be binding and conclusive. The expense of such arbitration to be equally divided. ‘4th. In the event of loss being.sustained, the Surety shall be entitled to share with the employer, pro rata, on the basis which the Surety’s loss bears to the employer’s total loss, in any recovery by the employer upon or by reason of such loss from every source other than from the Surety, and excepting any recovery upon or from, other suretyship from suGh employee; and, likewise, in the event of loss by the employer, within the terms and provisions of this obligation, and, in excess of the amount thereof, the employer shall be entitled to share with the surety pro rata on the basis which the employer’s loss (if in excess of the actual loss for which the Surety is liable hereunder) bears to the employer’s total loss (i e. after expenses are deducted) by the Surety from, upon, or by reason of its payment of such loss. “5th. That apy settlement of any claim made hereunder shall operate as a complete discharge of the Surety under this bond. “6th. That the Surety’s liability hereunder shall cease immediately, as to subsequent acts of the employee from and after (a) the first day of April, 1918; (b) discovery by the employer or any of its officers of any default hereunder on the part of the employee; - (c) the employee leaving for any reason the service of the employer; (d) fifteen (15) days after written notice niailed to the employer by the Surety of its desire to withdraw as Surety, and any claim of the employer against the Surety must be duly presented to the Surety not later than six months after such termination of the Surety’s liability. “7th. This bond may be continued from year to year by the payment of an agreed premium to the Surety and the issuance of its continuation certificate, and provided that the liability of the Surety shall not exceed the amount above written, whether the loss shall occur wholly during the term above named or during any continuation thereof, or partly during said term, or partly during any continuation thereof, and in case of any such continuation the Surety’s liability on behalf of the employee shall be as continuous as if this bond had been originally written for a term including the period of such renewal. “8th. No action or proceeding at law, or in equity shall be brought to recover from the Surety any claim under this bond, unless commenced within a period of twelve months after the date the employer shall have given notice of claim. “9th. This bond is invalid unless it be signed by the employee, and the premium charged actually be paid to the Surety before the employer or any officer shall have knowledge of any probable or actual default thereunder. “That after the execution and delivery of the said bond, or writing obligatory, under seal, by the said defendants to the said Sopchoppy State Bank, the said defendant Alonzo D. Wilder entered upon his duties as an employee of said bank and thereafter, to-wit: After the 12th day of Api’il, A. D. 1912, at twelve o’clock noon, the said defendant, Alonzo D. Wilder, continuously remained in the employ of said Sopchoppy State Bank until the 29th day of July, A. D. 1912, and that between the said 12th day of April, A. D. 1912, at twelve o’clock noon and the said 29th day of July, A. D. 1912, the said defendant, Alonzo D. Wilder, while in the employ of the said Sopchoppy State Bank, at its banking house, or office, in the said town of Sopchoppy in Wakulla County, Florida, and while the said bonds, or writing obligatory. under seal, was in full force and effect, . and none of the conditions .precedent to recovery had been in any way violated, ignored, or evaded, was guilty of fraud and dishonesty, including larceny or embezzlement and disappropriation of funds, as is more particularly shown by the itemized statement of the loss of said Sopchoppy State Bank furnished .as the proof of such loss to the said defendant, National Surety Company, under and in accordance with the terms of said bond, or writing obligatory, under seal, and within the time therein and ■thereby required (a copy of which proof of loss, and itemized statement of the loss of said Sopchoppy State Bank in the manner and by the means so sustained as aforesaid, being hereto attached, marked exhibit ‘B’ and prayed to be taken as part hereof by reference.) That the said property and funds so taken, embezzled or misappropriated by the said defendant, Alonzo D. Wilder, within the time hereinbefore stated, to-wit: Between the 1st day of April, 1912, at twelve o’clock noon, and the 29th day of July, A. D. 1912, was the property of the said Sopchoppy State Bank by means whereof the said defendant, National Surety Company, became, was and is liable to pay to the said Sopchoppy State Bank and is indebted to the said Sopchoppy State Bank for the full sum of its said bond, namely, $10,000.00, and the said defendant, Alonzo D. Wilder, by reason of his wrongful acts in the premises set forth, became, was and is liable to pay the said Sopchoppy State Bank, and is indebted to the said Sopchoppy State Bank for the full sum lost by the said bank by reason of his said wrongful acts. That it became known to the»said Sopchoppy State Bank on the 29th day of July, A. D. 1912, that the said defendant, Alonzo. D. Wilder, as the employee of said bank, had been guilty of fraud, dishonesty, including larceny, or embezzlement, and the misappropriation of funds, while the said defendant, Alonzo D. Wilder had, during the time aforementioned, been in the service of the said Sopchoppy State Bank as its employee. That the said Sopchoppy State Bank had had no- knowledge prior to the said 29th day of July, A. D. 1912, that its said employee, the said defendant, Alonzo D. Wilder, had been in arrears, or in default in any way whatever; nor had the said Sopchoppy State Bank or any of its officers had any knowledge that its said employee, the said defendant, Alonzo D. Wilder, had been in arreasr, or in default in any way whatever, prior to said date, nor had the said Sopchoppy State Bank or any of its officers had any knowledge prior to the said 29th day of July, A. D. 1912, that the said defendant, Alonzo D. Wilder, its said employee, was gambling, speculating, or committing any disreputable, lewd, or any unlawful act; nor had the said Sopchoppy State Bank in any way condoned any act on the part of the said employee, the said defendant, Alonzo D. Wilder, which act would give rise to a claim unedr said bond, or writing obligatory, under seal; nor has any loss arising under said bond, or writing obligatory, under seal, or any part thereof, been settled with or without the written consent of the. said Sopchoppy State Bank. That immediately upon becoming aware of any act, or acts, on the part of the said defendant, Alonzo D. Wilder, made a basis of this claim under said bond, or writing obligatory, under seal, the said Sopchoppy State Bank gave noti.ce thereof by telegraph'to the defendant, National Surety Company, at its home office in the City of New York, and subsequently gave notice to the said defendant, National Surety Company, by registered letter, addressed to the said defendant, National Surety (Company) at its said home office, within ninety days after said loss under said bond, or writing obligatory, under seal, became apparent to the said Sopchoppy State Bank. That the said Sop-choppy State Bank, and the plaintiff herein has in all things complied with each and every of the terms, conditions and obligations of said bond, or writing obligatory, under seal, on the part of the said Sopchoppy State Bank, and the receiver thereof on its, or his part to be carried out and to be performed. That by reason of the fraud and dishonesty, including larceny, or embezzlement, or misappropriation of funds, as hereinbefore set forth, by the said defendant, Alonzo D. Wilder, the said defendant, Alonzo D. Wilder, became indebted to the said Sopchoppy State Bank for such sum, or sums, and the said defendant, National Surety Company, became liable to the said Sop-choppy State Bank for such wrongful acts aforesaid of the said defendant, Alonzo D. Wilder, to the extent and in the amount of not exceeding $10,000'.00, and the interest thereon from the date of such acts of fraud, dishonesty, including larceny, or embezzlement, or misappropriation of funds, on the part of the said Wilder, but the said defendants have not, nor have either of them, paid the said sum, or any part thereof to the said Sopchoppy State Bank, or the plaintiff herein, though often requested so to do, but has neglected and refused, and still does neglect and refuse to pay the same to the great damage of the plaintiff. “That on the 7th day of May, A. D. 1913, the plaintiff herein was by order of the Judge of the Circuit Court of the Second Judicial Circuit of Florida, in and for Wakulla County, in chancery sitting, in the suit of W. V. Knott, as Comptroller of the State of Florida vs. Sop-choppy State Bank, a corporation organized and existing under and by virtue of the laws of the State of Florida, appointed receiver of the said Sopchoppy State Bank. That on the lltli day of October, A. D. 1913, in the said cause last above named, the said plaintiff was, by order of the Judge of the Circuit Court of the Second Judicial Circuit of Florida, in and for Wakulla County, in chancery sitting, authorized and empowered to employ counsel to sue in his own name as receiver of said Sop-choppy State Bank to recover such of the real and personal property, things in action, moneys, books, debts, legal and equitable interest, and all property and effects of any nature whatsoever, of the said Sopchoppy State Bank which belonged to the said bank at the time of the filing of the said bill of complaint in said cause, as said receiver had not already recovered and taken into his possession. “Wherefore, the plaintiff sues and claims $20,000.00 damages.” “EXHIBIT ‘B.’ “Proof of loss of Sopchoppy State Bank, a corporation under the laws of Florida with its place of business in the town of Sopchoppy, Wakulla County, Florida, made to the National Surety Company, a corporation under the laws of New York with its principal office or place of business at 115 Broadway, New York City, N. Y. “To the National Surety Company: “You will please take notice that by your bond numbered 6G3069 issued by your company on the 12th day of April, 1912, in consideration of the premium of twenty-five dollars to you duly paid, you, so designated in such bond agreed to reimburse the Sopchoppy State Bank, Sop-choppy, Florida, designated in such bond as the employer ■within, three months after- satisfactory proof of loss for any pecuniary loss sustained by the employer by any act of fraud and dishonesty including larceny or embezzlement, forgery and misappropriation of funds committed by Alonzo D. Wilder, designated in such bond as the employee, in any position in the Sopchoppy State Bank’s service during the term commencing on the first day of April, 1912, at twelve o’clock noon and ending on the first day of April, 1913, at twelve o’clock noon. “That on the 29th day of July, 1912,. it became known to the said Sopchoppy State Bank that its employee, the said Alonzo D. Wilder, had, as such employee of the said employer, been guilty of fraud and dishonesty including larceny or embezzlement, and .the misappropriation of funds, such acts having been committed by the said employee Alonzo D. Wilder while in the service of the said employer, the said Sopchoppy State Bank, and subsequent to the first day of April, 1912, at twelve o’clock noon, and prior to the first day of April, 1913, at twelve o’clock noon, as is more particularly shown by an itemized statement of the loss of the said Bank hereto attached, marked Exhibit 'A,’ and prayed to be taken as part hereof by reference, and the said Sopchoppy State Bank therefore claims of the said National Surety Company under -said bond the sum of Ten Thousand dollars indemnity. “That the said employer had no knowledge prior to the 29772, day of July, 1912, that the said employee had been in arrears, or in default in any way whatever; that the said employer has' had no knowledge that the said employee was gambling, • speculating, or committing any disreputable, lewd or unlawful act; nor has it, the said Sop-choppy State Bank, in any way condoned any act giving rise to a claim under said bond; nor has any loss arising thereunder been settled (with or without the written -consent of the said Surety first obtained.) “That upon becoming aware of any act or acts made the basis of this claim under said bond, the said Sopchoppy State Bank gave immediate notice thereof by telegraph to the said Surety at its home office, and subsequently gave notice by registered letter addressed to the said Surety at its home office, and within ninety days after the said loss umjer said bond became apparent to the said Sopchoppy State Bank it hereby files with said Surety an itemized claim under the said bond duly sworn to. That said Sopchoppy State Bank, upon request of the said National Surety Company, stands ready and willing to produce for investigation all books, vouchers, and evidence which the. said Surety may require and to lend every assistance to bring the said employee to justice and to stand to, abide by, carry out and perform every other act or thing necessary or required of it, by and under the terms of said bond. “SOPCHOPPY STATE BANK, . “By A. B. WINN, “1st Vice President. “Sopchoppy, Florida, October — 1912. “State of Florida, “Wakulla County. “Before me, the undersigned authority, personally appeared A. B. Winn, who, being first duly sworn, says' that he is the First Vice-President of the Sopchoppy State Bank, a corporation under the laws of Florida with its office or place of business at Sopchoppy in said County and State, that he -is authorized -to make this oath, that he has read the foregoing proof of loss and that the facts stated therein are true, and that the said Bank has actually sustained loss in the manner and to the extent and amount therein stated. A. B. WINN. “Sworn to and subscribed before me this the — day of October, A. D. 1912. Notary Public,. State of Florida at Large. “SOPCHOPPY STATE BANK, Sopchoppy, Fla., August 7, 1912. Statement of errors and discrepancies against A. D. Wilder, Ex-Cashier, as of July 23rd, 1912. To Debit from First National Bank Tallahassee, May 17th, 1912, unable to locate any record of same...............................................................................................................$ 10.00 To Debit memo from 1st. Nat. Bank Tallahassee, May 11, 1912, no record ........................................................... 5.65 To Difference in check on Peoples Bank Jacksonville, as credited on Cash Book, Check No. 95, $48.38. Should be as per check No. 95, $49.38, U-C.................................................................................................................. 1.00 To difference in Savings deposit ticket, 6-20. Robt. Ashmore, credited with $11.00. Cash books reads, $5.00', U-C....................................................... 6.00 To difference in Deposit ticket of June 29th. Hilton Gwaltney, ticket reads Deposit, $3.00. Individual Ledger reads $8.00, O.-C......................... 5.00 To check No. 3, on Peoples Bank, not on cash book 55.49 To Debit memo Peoples Bank 6-27, no record............ 1.00 To ” ” ” ” 7-5, ” ” ____ 40.00 To ” ” ” ” 7-6, ” ” .... 18.29 To personal check on Peoples Bank 4-5-12....... 10.00 $152.43 To Cashiers Check No. 22 not on cash book.................. 5.00 Sheet No. 1. $157.43 Exhibit 'B.’ “SOPCHOPPY STATE BANK, Sopchoppy, Fla., August 7th, 1912. Statement of Overdrafts, chargeable to A. D. Wilder, Ex-Cashier. As of July 23rd, 1912. R. T. Alcorn......................................................28.57 I. T. Coleman................................................25.65 1). W. Syfret................................................... 3.00 A. D. Wilder...................................'. ............ 4.95 P. A. Wood & Son.......................................21.76 $83.93 “ Statements of credits on Individual Ledger not appearing on cash- book,and for which no deposit ticket issued.' June 15th, 1912, A. D. Wilder ... .4.75 June 18th, 1912, A. D. Wilder .... 25 $5.00 Sheet No. 2 Exhibit 'B.’ “SOPCHOPPY STATE BANK, Sopchoppy, Fla., August 7th, 1912. Loans and Discounts. Statement of loans made by Ex-Cashier, A. D. Wilder to irresponsible parties, without the consent or approval of the Board of Directors or Committee on Loans of said Bank, which is contrary to the By-Laws. Date of Note . Maker Time Amount June 25th, 1912 J. R. Lawhon, 12 Months, $500.00 ” 25th, ” J. R. Lawhon, 12 ” 500,00 27th, ” C. I. Guilford, 12 500.00 27th, ” C. I. Guilford, 12 500.00 27th, ” J. W. Wilson, 12 500.00 27th, ” J. W. Wilson, 12 500.00 27th, ” J. W. Wilson, 12 500.00 Sheet No. 3. $3500.00 Exhibit ‘BA “SOPCHOPPY STATE BANK, “Sopchoppy, Fla., August 7, 1912. Statement of Notes of A. D. Wilder, Ex-Cashier for borrowed money from Sopchoppy State Bank, Sopchoppy, Fla., said loans were not referred to, passed on or approved by the Board of Directors or committee on loans, said act not in accord with the By-Laws. “The Minutes of the Bank have been carefully examined, and shows no record of authorizing or disapproving the following: Dates of Notes. Name. When Due. Amount. May 7th, 1912, A. D. Wilder, 6 months...... $750.00 13th, ” ” '3 ” ...... 250.00 23rd, ” ‘ ' ” 6 ” ...... 50Q.00 29th, ” ” '6 ” ____!. 1,129.25 30th, ” ” 4 ” ...... 350.00 June 7th, ” ” 12 ” ____,. 360.00 10th, ” ” 12 350.00 "15th, • ” ” ' 12 ” 290.00 22nd, ” ' ” 60 days ....... 75.00 July 5th, ” ” ■” ” ......• 300.00 11th, ” ” <................ 500.00 11th, ” ” 12 mouths ...... 500.00 Sheet No. 4. $5,354.25 Exhibit ‘B.’ ‘‘SOPCHOPPY STATE BANK Sopchoppy, Fla., August 7th, 1912. A. D. Wilder, Ex-Cashier, To Sopchoppy State Bank, Sopchoppy, Fla., Dr. Bills receivable account, as per daily balance, July 23rd, 1912 .......................•.. $26,651.01 Inventory óf bills receivable, July 23rd, 1912 24,207.01 Short ................................. $2,445.00 Memo. Bills Eeceivable taken as per Cash Book.... $28,226.65 Bills Eec. paid as per Cash Book............ 1,574.64 Agrees with Daily Eeport of July 23, 1912.. $26,652.01 Exhibit ‘B.’ Sheet No. 5. D. .F. McCoy, Auditor, Statesboro, Ga.” “SOPCHOPPY STATE BANK. Sopchoppy, Fla., August 7th, 1912. Surety Company account A. D. Wilder, Ex-Cashier, To Sopchoppy State Bank, Dr. To Sheet No. 1, Errors and Discrepancies ... .$ 157.43 To Sheet No. 2, Overdrafts.................. 83.95 To Sheet No. 2, Cash Credited on Individual Ledger not appearing on Cash Book...... 5.00 To Sheet No. 3, Notes representing loans made without authority of Board, or Loan Committee .............................• 3,500.00 To Sheet No. 4, Notes representing borrowed moneys by A. D. Wilder, Ex-Cashier, without the authority of the Board of Directors, or Committee on Loan................... 5,354.25 To Sheet No. 5, Bills Eeceivable short of ledger account ......................... 2,445.00 TotaL............................... $11,545.61 Becapitulation. Exhibit ‘B.’ D. F. McCoy, Auditor.” This count of the declaration was demurred to by the defendant National Surety Company on the following grounds “(1). The said count does not allege the plaintiff has sustained a pecuniary loss under the terms of the instrument sued on. ' “(2). The said count does not-set forth or allege the act or acts of fraud and dishonesty, including' larceny or embezzlement, forgery and misappropriation of funds, which occasioned the pecuniary loss, if any, sustained by the plaintiff under the terms of the instrument sued on. “(3). The -said count does not allege whether the loss claimed to have been sustained by plaintiff was through the fraud and dishonesty of Alonzo D. Wilder, or by his larceny, or by his embezzlement, or by his forgery, or by his misappropriation of funds.” At the same time the defendant filed the following pleas: “ (1) • That by the terms of this defendant’s bond sued on in the said count of plaintiff’s declaration, the defendant’s agreement as surety to reimburse the employer (Sop-choppy State Bank) within three months after satisfactory proof of loss for any pecuniary loss sustained by the employer (Sopchoppy State Bank) by any act of fraud and dishonesty, including larceny- or embezzlement, forgery and misappropriation of funds, committed by the employee (the defendant Alonzo D, Wilder) in any position in the employer’s service,, during the term commencing on the 1st day of April, 1912, at 12 o’clock noon, and ending on the 1st. day of April, 1913, at 12 o’clock noon, and the said defendant says that the alleged pecuniary loss of the Sopchoppy State Bank was not sustained by any act of fraud and dishonesty, including larceny or embezzlement, forgery and misappropriation of funds, committed by the said Alonzo D. Wilder during the time aforesaid. “And for a second plea to the said count of the declaration the said defendant says “(2). That the Sopchoppy State Bank has never furnished the said defendant with satisfactory proof of the loss alleged in said count of the declaration to have been sustained by said bank. “And for a third plea to the said count' of the declaration the said defendant says: “(3). That the Sopchoppy State Bank did not within ninety days after' the date of the notice by telegraph and registered letter mentioned in the said count of the déclarátion file with the said defendant an itemized claim duly sworn to, as required by the terms of this defendant’s bond sued on in said count of plaintiff’s declaration. “And fór a fourth plea to the said count of the declaration the said defendant says: “(4).. That the Sopchoppy State Bank did not upon becoming aware of the alleged acts of the said Alonzo D. Wilder made the basis of its claim under this defendant’s bond sued on in said count of the declaration give immediate notice thereof to this- defendant at its home office by telegraph and by a registered letter as required by the terms of its said bond. “And' for a fifth plea to the said count of the declaration the said defendant says: “(5). That the plaintiff’s action on this defendant’s bond sued on in the said count of the declaration was not commenced within a period of twelve months after the date of the Sopchoppy State Bank is alleged to have given notice to this defendant of the claim which it is alleged the said Bank had under the terms of the said bond. “And for a plea to the second, third and fourth counts of, the plaintiff’s declaration, and to each thereof, this defendant says it never was indebted as alleged.” The demurrer to the declaration was overruled by the Circuit Judge, and a demurrer to pleas numbered four and five was also overruled» The following replication was filed to pleas numbered four and five: “Now comes the plaintiff, by his attorneys,, and for replication to the 4th plea of the defendant. National Surety Company, to the first count of the plaintiff’s declaration says:- . ■ “1st. That said Sopchoppy State Bank did, according to-the terms of the said defendant bond,-upon becoming" aware -of the alleged-acts of fraud and dishonesty, including larceny or .embezzlement, forgery aud misappropriation of funds, committed by the said Alonzo D» Wilder, and made the basis of the plaintiff’s claim under this defendant’s bond, give immediate notice thereof to the said defendant, National Surety Company, at its home office by telegraph and by registered letter as required theretin. “2nd. That the said defendant, National Surety Company did, upon receiving notice from the plaintiff, Sop-choppy State Bank, by telegraph, sent July 29, 1912, to defendant at its home office in N. Y. City, of the alleged acts of fraud and dishonesty, including larceny or embezzlement, forgery and misappropriation of funds, committed by the said Alonzo D. Wilder, immediately send to the said Sopchoppy State Bank, at Sopchoppy, Florida, a duly authorized agent of the said defendant, National Surety Company, which said agent did, then and there upon his' arrival at the Bank of said Sop-choppy State Bank, at Sopchoppy, Florida, enter into an investigation of the claim of said Sopchoppy State Bank against the said defendant, National Surety Company, for the pecuniary loss of the said Sopchoppy State Bank sustained by it through and by reason of the alleged acts of the said Alonzo D. Wilder, and that the said defendant, National Surety Company, did therefore, and did thereby waive the requirement in its said bond that the said Sopchoppy State Bank should give notice to the said defendant, National Surety Company, by registered letter. “And for replication to the 5.th. plea of the defendant National Surety Company, to the first count of the plaintiff’s declaration the plaintiff says: “That the plaintiff did commence this action against the said defendant, National Surety Company, within a period of twelve months after the date the said Sop-choppy State Bank gave notice to the said defendant of its claim: and the amount thereof. against the said defendant, National ■ Surety Company,- under- its said bond.” • Issue was-joined-on the first, second and third -pleas-of said defendant. A demurrer to plaintiff’s second .replication to defendant’s fourth plea was. overruled, and a motion.that plaintiff.be compelled to amend its replication to said defendant’s fifth plea by striking out the words “and the amount'thereof” having been granted, issue was joined ,on plaintiff’s replications to defendant’s fourth and fifth pleas. . .' The defendant Wilder also.filed pleas to- -the declaration, upon.which issue was joined. Upon a trial of the case upon the issues, thus made up, a verdict in the sum of $10,000.00, the.amount of the .bond, with interest from the date,.of the institution of said suit was, rendered in favor of the plaintiff, upon which judgment was duly entered. A motion for new trial having been, made and denied by the Circuit Judge, the case is here upon writ of error .for review. Summons-and severance was taken, and the writ of error is prosecuted by. the National Surety • Company alone.