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an examination was made of the office of city controller of the city of Indianapolis, and that a report of said examination was made, signed, verified, and filed (as directed by statute); that one copy was transmitted by the Governor to the Attorney General, and the Attorney General hereby institutes and prosecutes this civil proceeding against the defendant in order to carry into effect the findings resulting from such examination, and to secure to the said city of Indianapolis the amount due it from the defendant as hereinbefore alleged.

"Wherefore, the plaintiff demands judgment against the defendant for $1,900, and all other proper relief."

A demurrer to the complaint on the ground that it does not state facts sufficient to constitute a cause of action was overruled. The defendant filed an answer in eight paragraphs. A demurrer was sustained to the third, fourth, and fifth paragraphs of the answer, and overruled as to the second, sixth, and eighth. The first paragraph of the answer is the general denial; the second is on the theory of estoppel, and avers that the bank was deceived by the negligent conduct of the city officers; the sixth pleads facts tending to show that each order was payable to bearer; and the eighth is on the theory of estoppel, and avers (in addition to other averments) that once each month the bank balanced the plaintiff's passbook, and delivered the passbook, together with the orders for the payment of which the bank claimed credit, to the plaintiff; and that the plaintiff never complained or gave notice to the defendant that any of the orders were fraudulent until long after the last order had been paid. A reply in denial closed the issues. The trial resulted in a verdict for the defendant.

The plaintiff filed a motion for a new trial on the following grounds: (1) That the verdict is not sustained by sufficient evidence; (2) that the verdict is contrary to law; (3) that the court erred in excluding from the evidence the Plaintiff's Exhibit No. 2, which is a report, made to the state examiner by the field examiners, of an examination of the affairs of the city controller; (4) that the court erred in refusing to permit the witness Mr. Thomas, one of the field examiners, to state to the jury whether his investigation disclosed that persons bearing the names used as the names of payees in the orders had indorsed the orders; (5) that the court erred in excluding from the evidence a portion of page 163 of the Indianapolis City Directory for the year 1915, published by R. L. Polk & Co., after identification and explanation; and (6) that the court erred in certain instructions given, and in rejecting certain instructions tendered. The motion for a new trial was overruled. The errors assigned challenged the ruling on the demurrer to the second, sixth, and eighth paragraphs of answer, and the ruling on the motion for a new trial.

U. S. Lesh, Atty. Gen., Taylor E. Groninger and Dale F. Stansbury, both of Indianapolis, and Willard B. Gemmill, of Marion, for appellant.

Chas. W. Miller and Henry M. Dowling, both of Indianapolis, for appellee.

DAUSMAN, J. (after stating the facts as above). [1] An extended discussion of the merits of the second, sixth, and eighth paragraphs of the answer would serve no useful purpose. It is sufficient to say that, excepting the averments relating to the balancing of the passbook, the facts averred in these paragraphs were substantially the facts averred in the complaint. The only purpose of these paragraphs (with the exception above stated) was to present the defendant's theory of the legal effect of the facts. See Trinkle v. Ladoga Bldg. Loan Fund & Savings Ass'n, (1917) 65 Ind. App. 415, 117 N. E. 542. No evidence was adduced under these paragraphs which would not have been admissible under the general denial, and therefore because of the provision of the Code applicable to this feature the ruling on the demurrer could not be reversible error even if technically erroneous: Section 350, Burns' 1914; section 345, R. S. 1881.

We must now discover, if possible, the true theory of the complaint; for a definite understanding of that theory is essential to an intelligent consideration of the motion for a new trial. By indulging inferences with a liberality which can hardly be justified, it may be said that the cause of action rests on the ground that the street commissioner, for the purpose of defrauding the city, falsely represented to the board of public works that certain persons were entitled to wages for work done by them on the streets; that in truth there were no such persons, and that they had no existence except in the imagination of the street commissioner; that in making the allowances, in preparing and delivering the orders to the street commissioner, the city officers believed that the payees were real persons; that since in truth the payees were the exclusive creatures of the street commissioner's imagination, any signature which purports to be the indorsement of any payee must necessarily be a forgery; and that therefore the depository is liable for paying the orders on the forged indorsements. No other valid theory of liability can be constructed from the facts averred. No cross-error has been assigned and the sufficiency of the complaint is not questioned in this court.

To meet the contentions of the parties an inquiry into the regularity of the method pursued by the city officers in allowing the claims and issuing the orders is essential.

The General Act of 1905, prescribing the details of municipal government, as amended, provides that the board of public works shall have power to repair, clean, light, and sprin

(148 N.E.)

dicial.

kle the streets, alleys, and other public places, and his action in that regard was quasi juwithin the city, and that this work may be done either by contract or by the board itself. Section 8696, Burns' 1914; Acts 1913, p. 253.

The only inference to be drawn from the complaint is that the board elected to do the street work itself by and through its own employees. See Brunaugh v. State (1910) 173 Ind. 483, 90 N. E. 1019. No statute has been pointed out to us, and we know of none, which provides for any such officer as street commissioner. Therefore we indulge the further inference that the street-working force was organized, and for convenience was designated "street department"; that one Dennis J. Bush had general supervision of the laborers engaged in street work, and for convenience was designated "Street Commissioner"; that the department in all respects was under the immediate direction and control of the board of public works; and that Bush furnished the board, from time to time, information concerning wages due the men employed in the street department.

[4] It is of the utmost importance to noteand the fact should be clearly understood and fully appreciated-that the city officials and the depository were operating under the There can be direction of certain statutes. no accurate reasoning on the subject, which The govdoes not rest on that foundation. ernmental act of 1905 made the treasurer the custodian of city funds, and made it his duty to pay all city orders when presented Under that law and "properly indorsed." it would be his duty, when an order is presented, to ascertain if the payee owes the city on account of "any debt, tax or assessment," and if anything is found to be due the city from the payee, then to apply the order, or so much thereof as necessary for that purpose, to the payment of the tax or assessment; and upon the payment of any order, to stamp on its face the word "redeemed." That law also requires the treasurer to furnish the controller, on the first day of each month, a statement of all receipts and disbursements made by him dur[2] Under the statutory plan for the paying the previous month; to deliver to the conment of claims originating in the department troller all orders redeemed and canceled by of public works, if the workmen were to rehim during the same period; and to take the ceive their wages, it was essential that the controller's receipt therefor. It requires the board should take some action on the claims reported to it by Bush; for no order could controller to lay the statement, together with the redeemed orders, before the common be drawn on the treasurer by the controller council at its next meeting, to be disposed for the payment of the claims without a of as the council may direct. Sections 8835"warrant" from the board. Section 8690, 8837, Burns' 1914 (Acts 1905, pp. 371, 372); Burns' 1914; Acts 1909, p. 385. By implica- section 8656, Burns' 1914 (Acts 1909, p. 459). tion, the statute confers ample power upon From the language of that statute it clearly the board to allow or disallow claims of that appears that the Legislature intended that kind. Sections 8690, 8696, Burns' 1914, suevery order should be delivered to the payee pra; Brunaugh v. State, supra. The aver- when drawn, and that the payee should prement is that, relying on some sort of certifi- sent it to the treasurer for payment. Under cate made by Bush, and "not knowing or as- that law the legal title to the funds vested in certaining that the claims were filed for fic- the treasurer, and when the funds were detitious or nonexisting persons," the board al- posited, the relation of bank and depositor lowed them. existed between the bank and the treasurer, and payments were made by the bank on the treasurer's checks. But the act of 1907, commonly known as the Depository Law, has changed that plan. The later act provides that

[3] It is averred that the claims, as allowed by the board, were presented to the controller. That averment may be taken to mean that the board presented to the controller what the statute denominates a "warrant," and that the "warrant" was based "All warrants and orders for the payment upon the claims thus allowed. With respect of public money, excepting state and township to this averment it should be observed that funds shall be drawn by the proper officer upon * * * shall be prethe controller, as head of the finance depart- the proper treasurer; * * * who ment, had ample power to investigate the sented to the proper treasurer ** * *shall stamp upon the warrant or orclaims and to approve or disapprove any item der the name of the depository by which such in the warrant, notwithstanding the allow-warrant or order is payable, and countersign ance by the board. He had power to require evidence to enable him to determine whether the amount claimed in any item was justly due; and for that purpose he was authorized to summon before him any officer, agent, or employee, of any department, or any other person, and to examine him upon oath relative to the claims or the warrant. Section 8690, Burns' 1914, supra; Brunaugh v. State, supra. The controller approved the claims,

the same, and no warrant or order shall be effective until so stamped and countersigned." Section 7545, Burns' 1914; Acts 1907, p. 391, as amended Acts 1911, p. 616.

Under the act of 1907 the legal title to the funds vests in the municipality; and when the funds are deposited in a public depository the relation of depository and depositor is thereby created between the depository and the municipality. The Legislature has

undertaken to control the entire subject. It 1913, p. 120. They are exactly what they are has pointed out specifically the method by denominated in the statute, viz. "orders,” and which claims against the municipality shall are specially designed to meet the requirebe paid; and in the case at bar it is evidentments of the depository law. Nevertheless, it that the city officers followed the method designated in the act of 1907. It is unfortunate that the two statutes are not entirely harmonious.

Guaranty State Bank & Trust Co. v. Lively (1912; Tex. Civ. App.) 149 S. W. 211; First Nat. Bank of Hastings v. Farmers' & Merchants' Bank (1898) 56 Neb. 149, 76 N. W. 430; First Nat. Bank of Hastings v. Omaha Nat. Bank (1899) 59 Neb. 192, 80 N. W. 810.

[6] Now, is there any proof to support the

was the duty of the depository to exercise due care in paying them. If in truth the names written in the orders represented creatures having no existence save in Bush's fanThe city officials were endowed with ample cy, and if in truth the controller believed power to make allowances and to issue or- that he was making the orders payable to ders. They acted within the scope of their real persons, then the orders were not pay authority and their action is binding upon able to bearer. They were payable to real the municipality. The action of the treas- persons, or not payable at all. That is the urer in stamping and countersigning the or- rule applicable to checks, and we perceive no ders was a positive direction to the deposi- reason why it should not be applied to these tory to pay them. It was not the duty of the orders. Snyder v. Corn Ex. Nat. Bank (1908) depository to inquire concerning the regulari-221 Pa. 599, 70 A. 876, 128 Am. St. Rep. 780; ty of the allowances. Indeed, on the facts disclosed in this action, it would have been an impertinence on the part of the depository, had it assumed to question the decision of the city officials or to exercise supervisory power over their discretionary action. The depository was not the guardian of the city's officers. After payment by the depository, without notice, then as between the city and the depository the city will not be permitted to say that the allowances were obtained by the fraud of a city employee. It would be unconscionable to allow the city to set up the fraud in order that the loss, if any, may be shifted upon the depository. In determining the rights of the parties, the element of fraud must be wholly eliminated. The only legitimate purpose of the averments of the complaint relating to the alleged fraud is to explain how the orders happened to be made payable to alleged fictitious persons. To give those averments any other effect is not allow able; for it was not the duty of the depository to make an investigation for the purpose of discovering the fraud which the city officers failed to discover. If the opposite view should be adopted, as a rule of law, no reputable bank would consent to accept deposits of public funds. See Newburyport v. Spear (1909) 204 Mass. 146, 90 N. E. 522, 134 Am. St. Rep. 652; Meyer v. Indiana Nat. Bank (1901) 27 Ind. App. 354, 61 N. E. 596. It follows that the depository is not liable in this action unless it is amenable to the city for negligence in the manner of payment.

theory of the complaint? The uncontrovert1914 and 1915 labor conditions were such as ed evidence discloses that during the years that the board of public works evidently was obliged to employ whomsoever it could get to do the work of cleaning and repairing the streets and sewers. The laborers who did that work constituted a motley crew. Many of them were transients who would work a week or two and then disappear. Some of them assumed false names, some for the purpose of avoiding the deduction of delinquent taxes from their wages, others for reasons known only to themselves. The number so employed ranged from 50 to 60 in the winter and from 300 to 400 in the summer. During the week ending June 2, 1915, the number employed in the asphalt repair plant alone was 82.

Among them were persons known by such names as Stibby Staub, Goosie Costello, and Greasy Bob Walters. Walters was also known by two other aliases, viz. Ross Mills and Joe Merz. Stibby Staub also used the name of Joe Stark.

The foreman of each gang recorded, in time sheets provided for that purpose, the days and hours each man worked. From those sheets the time clerk of the street de

[5] The appellant concedes that the writ-partment made lead pencil pay rolls, which he ten instruments paid by the depository were not checks when drawn by the controller. It insists, however, that they became checks when stamped and countersigned by the treasurer, and that therefore the duty of the depository with respect to the payment of them was the same as the duty of a bank with respect to the payment of checks. From the face of the instruments themselves it is obvious that they are not checks. 7 C. J. 673. Because the amount stated in each order is "subject to all delinquent taxes," they are not even negotiable instruments. Sections 9089a, 9089b, Burns' 1914; Acts

turned into the office where they were typewritten. The street commissioner certified the correctness of the typewritten pay rolls, which were then presented to the board of public works. After allowing the items therein, the board certified the allowance of the pay rolls to the controller, as "warrants" for the issuance of orders thereon. When the orders came to the street department, which was usually on Friday of each week, they were given to the timekeeper, who "would sort them out in little bunches for the different gangs, and deliver them to the foreman of each respective gang." Usually

(148 N.E.)

of these witnesses, a post office employee at the time of the trial, confirmed the genuineness of the order payable to him and of his indorsement thereon. The rest of these witnesses testified that they did not indorse the orders, did not receive the proceeds thereof, and knew nothing about them-mere negative testimony.

Without reciting further details, we are compelled to say that, when viewed in the light most favorable to the plaintiff, the evidence wholly fails to support the averments of the complaint. If the jurors had returned

each pay roll contained several hundred lar to, the names in some of the orders. One names, and the orders involved in this action are based on items dispersed throughout the various pay rolls. It was the custom of the men in each gang to borrow money from their foreman. Some of them began to borrow on Monday, and continued borrowing small sums from day to day; and when pay orders were received they would repay their loans by indorsing the orders and delivering them to the foreman. It was a common practice for some of the workmen to have their pay orders cashed at saloons, grocery stores, and other places. That the workmen would resort to such methods of obtaining a verdict for the plaintiff, it would have cash might have been anticipated; for they could not well go to the depository during banking hours. Even if they had taken their orders to the depository, who would have vouched for their identity? Consequently all of the orders, except nine, were paid through the clearing house. When the orders were thus paid by the depository, each one bore several indorsements, all of which were indorsements in blank. Eight of the orders were paid by the depository over its own counter. In some manner one order reached the treasurer's office, where it was confiscated and applied to the payment of delinquent taxes.

The depository balanced the city's passbook and delivered it, together with the redeemed orders, to the treasurer every three or four months. The presumption is that the treasurer took credit on his account with the city for the amount of the orders, and returned them to the controller; that the controller laid them before the common council; and that the common council approved the whole matter. The record does not disclose that any city official has ever claimed that the names written in the orders represented fictitious persons, or that the depository is in any manner liable to the city. But in the year 1917 the bureau of public accounting made an examination of the office of the city controller. Field examiners checked the names in the orders with the names in the city directory, in their effort to determine whether the orders were fraud

ulently issued. Many persons were interviewed, subpoenas were issued, and a grand jury investigation was conducted. A field examiner laid the matter before the corporation counsel, and requested him to institute an action against the depository, but the city's legal department ignored the request. A field examiner made the demand on the depository, and this action followed. Although the name of the corporation counsel now in office appears upon the brief, no one representing the legal department of the city government has participated in the proceedings. In an effort to prove that the indorsements were forgeries 17 men were called as witSome of the names of these witnesses were the same as, while others were simi

nesses.

been the duty of the trial court promptly to have set it aside as being contrary to law.

[7] In view of the conclusion we have reached, it is wholly unnecessary to discuss the instructions. Where the jury returns the only verdict that can lawfully be rendered on the evidence, nothing in the charge can constitute reversible error.

[8-10] The report offered in evidence and excluded by the court is a voluminous docu. ment, comprising 148 pages of the transcript. It covers all the financial affairs of the city, including every department of the city government; contains elaborate explanations, recommendations, opinions, and conclusions of the examiners; recites a multitude of sins chargeable to the city officials, but not to the depository; and is certified by G. H. Hendren, state examiner. Only a very small part of it has any reference to the matter involved in this litigation. While the bulk of it is utterly foreign to the controversy in the case at bar and might be available in an action against city officials, it contains statements that would be prejudicial to the depository. The statute relating to public accounting contains the following:

"Any such report as is described in this section or a copy thereof duly certified by the state examiner shall be taken and received in any and all the courts of this state as evidence of the facts in such reports stated and contained." Section 7546i, Burns' 1914; Acts 1909, p. 136.

It is fundamental that the Legislature may not strike down the rights of citizens by invading the province of the judicial department of the state government. While this court is not authorized to declare a statute unconstitutional, nevertheless, where a statute is susceptible of two constructions, one of which would render it constitutional and the other one unconstitutional, it is our duty to adopt the former. Therefore we hold that the Legislature intended to declare that such reports only as are found to be competent under the established rules of evidence and in the particular kind of action authorized by the statutes relating to the subject of public accounting shall be received by the courts.

[11] A witness, who had been a member of two grand juries in 1916 and clerk of a grand

jury in 1917 and had otherwise participated | high school or of studying high school branches in an investigation to determine whether or not the orders were fraudulently issued was asked the following "question":

is one of the school privileges which a county board of education of the county must provide for all youth of school age in the district, upon failure of the board of education of the dis

"You may state, Mr. Thomas, if your investi-trict to provide the same. gation disclosed that any of the persons whom you investigated in this matter-persons who were of the same name as the payees thereinindorsed their names on these checks."

On what principle could the result of an ex parte investigation of that character be admissible? Was the defendant not entitled to cross-examine the persons investigated on the question as to whether they indorsed the orders? For other reasons the question is so obviously improper that further discussion is useless.

[12] The plaintiff offered a page of the city directory for the year 1915 for the purpose of proving thereby that no such person as Frank Akers resided in Indianapolis. The manager of the company that prepared and published the directory testified that the names appearing therein were procured by a house to house canvass between October 1 and December 31, 1914. The order payable to Frank Akers was issued June 2, 1915. Therefore the fact that his name does not appear in the 1915 directory cannot serve as a basis for the inference that the order was not properly indorsed in the name of Frank Akers, whether the name was real or

assumed.

[13] The right of the Attorney General to institute and maintain this action has not been questioned, and under certain provisions of the Code it seems to be our duty to regard it as having been waived. Section 344, cl. 6, and section 348, Burns' 1914; Acts 1911, p.

415.

Judgment affirmed.

SOMMERS v. PUTNAM COUNTY BOARD
OF EDUCATION et al. (No. 18894.)
(Supreme Court of Ohio. June 16, 1925.)

(Syllabus by the Court.)

1. Schools and school districts 148-County board of education is under mandatory obligation to provide school privileges, if district board of education fails so to provide; privilege of going to high school or studying high school branches is one which county board of education must provide on failure of district board so to provide.

Under section 7610-1. General Code, if the board of education in a district fails to provide sufficient privileges for all the youth of school age in the district, the county board of education of the county to which such district belongs is under a mandatory obligation to provide sufficient school privileges for all the youth of school age in the district.

By virtue of the provisions of section 77641, General Code, the privilege of going to a

2. Schools and school districts 148-County board of education by refusing to exercise option cannot absolve itself from liability.

While a board of education has an option as to the method by which it will make high school branches accessible to school children cise any one of the options, absolve itself from in the district, it cannot, by refusing to exerliability.

3. Work and labor 6-Beneficiary of duty
imposed, intervening to discharge another's
duty thereunder, is entitled to compensation.
imposed, who intervenes to discharge another's
One for whose benefit a statutory duty is
legal obligation, where the obligation is of such
a nature that actual and prompt performance
thereof is of grave public concern, after the
person upon whom the obligation rests has fail-
ed or refused, with knowledge of the facts, to
perform the obligation, is entitled to compen-
sation for the performance of the service.
4. Schools and school districts 1592-Par-
ent residing more than 4 miles from high
school, transferring children thereto, may re-
cover for transportation.

A parent who resides more than 4 miles from any high school in a rural school district, compulsory school age who have finished the who is compelled to transport his children of ordinary grade school curriculum to a high school more than 4 miles from his residence by reason of the refusal of the local board of education and the county board of education either to provide work in high school branches at some school within 4 miles of the children's from a high school, may recover in an action residence, or to transport the children to and at law for such transportation.

Jones, J., dissenting in part.

Error to Court of Appeals, Putnam County.

Action by A. F. Sommers against the Putnam County Board of Education and another. Judgment for defendants was affirmed by Court of Appeals, and case comes to Supreme Court on allowance of motion to certify record. Judgment reversed.-[By Editorial Staff.]

The plaintiff in error was plaintiff in the court below. He filed a petition in the court of common pleas of Putnam county, praying for a money judgment against the defend-* ants, the Putnam county board of education and the township board of education of Riley township, Putnam county, Ohio, in the sum of $397, with interest from June 1, 1923, and for costs. Defendants demurred to the petition.

The petition avers that the plaintiff is a resident taxpayer of Riley township, Putnam county, Ohio, and that at all times thereinafter mentioned he was the father of

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