GUARANTEE CO. OF NORTH AMERICA v. MECHANICS' SAVINGS BANK & TRUST(1899)
W. L. Granbery, for petitioner.
E. H. East, for respondent.
Mr. Justice HARLAN delivered the opinion of the court.
The plaintiff in this suit-originally brought in the chancery court at Nashville, Tenn., and subsequently removed into the circuit court of the United States for the Middle district of Tennessee-is the Mechanics' Savings Bank & Trust Company, a Tennessee corporation suing to the use of James J. Prior, assignee, under a general assignment of all the assets, rights, and credits of that company in trust for the benefit of creditors.
The principal defendant is the Guarantee Company of North America, a corporation created under the laws of the dominion of Canada.
From January 16, 1888, to January 1, 1893, Schardt was [173 U.S. 582, 583] teller and collector, and from the latter date until his death was cashier, of the plaintiff company.
The object of the present suit is to have an accounting and a decree as to the amount due the plaintiff on two bonds executed by the Guarantee Company of North America to the Mechanics' Savings Bank & Trust Company; one insuring the latter corporation against such pecuniary loss as it might sustain on account of the fraudulent acts of Schardt as teller and collector, the other insuring the same corporation against pecuniary loss by reason of fraudulent acts by him in his office of cashier.
The bill alleges that, while acting as teller and collector of the plaintiff company, Schardt fraudulently embezzled of its moneys the sum of $ 78,956.11, of which $50,856.77 was embezzled during the year ending January 1, 1893; and that during the period covered by the bond insuring his fidelity as cashier he fraudulently appropriated of the plaintiff's moneys the sum of $22,817.30.
The bill also alleged that a few days before his death Schardt assigned to the plaintiff company, as additional indemnity for the losses he had brought upon it, certain policies on his life, amounting to $80,000; that upon those policies $2,000 had been collected, and the residue was in dispute; and that Schardt did not give any direction as to which of the bonds insuring his fidelity the insurance moneys when collected should be applied.
The Guarantee Company, in its answer, insisted that by reason of the violation of the terms and conditions upon which the bonds in question were issued it was not liable to the plaintiff in any sum.
By the decree in the circuit court it was adjudged that the amount embezzled by Schardt during the years 1890 and 1891 had been paid out of the assets and collections transferred by him to the bank just before his death; that his e bezzlements from and after September 1, 1890, and up to January 1, 1893, amounted, principal and interest, to $52,736.17, while his embezzlements during his term as cashier amounted, principal and interest, to $23,128.69; and that the total amount, princi- [173 U.S. 582, 584] pal and interest, of all his embezzlements while occupying the two positions of teller and cashier, was $107,223.36.
The decree continued:
Upon appeal prosecuted by the Guarantee Company to the circuit co rt of appeals the decree was affirmed. 54 U. S. App. 108, 27 C. C. A. 373, and 82 Fed. 545. The case is here upon writ of certiorari.
The circuit court of appeals was without jurisdiction to review the decree of the circuit court, because that decree was not a final one. 26 Stat. 826, 828, c. 517, 6. The circuit court disallowed all of the defenses made by the Guarantee Company, and adjudged that upon the showing made that company was primarily liable to the extent of the penalty of each bond, with interest. But the liability of the defendant company was held to be secondary to that of Schardt's estate, which was in course of administration, and [173 U.S. 582, 586] the amount for which it could be held finally liable on execution was left to be ascertained by a master commissioner, who was directed to take into account 'all collections realized on assets or collaterals turned over to the bank by Schardt to reimburse it against his shortage,' or which the bank 'with due diligence may collect hereafter'; and the case was retained for the purpose of fixing the amount of this ultimate liability to make good Schardt's shortage, 'whatever that may be.' In effect, the circuit court only determined that none of the defenses were good in law, and that the Guarantee Company was liable on its bonds for such sum as might thereafter be found to be due after crediting the amounts that might be realized from the assets turned over to the plaintiff bank by Schardt. Notwithstanding the company's defenses were adjudged to be bad in law, it remained for the circuit court by proper orders to accomplish the object of the suit, namely, to ascertain the amount for which the plaintiff was entitled to judgment and execution. When that amount is judicially ascertained and fixed by a final decree, the adjudication of the cause will be completed for all the purposes of an appeal; and, if the decree be affirmed, the circuit court will then have nothing to do but to carry it into execution. Railroad Co. v. Swasey, 23 Wall. 405, 409; Green v. Fisk, 103 U.S. 518 , 519; Dainese v. Kendall, 119 U.S. 53, 54 , 7 S. Sup. Ct. 65; Lodge v. Twell, 135 U.S. 232, 235 , 10 S. Sup. Ct. 745.
The decree of the circuit court of appeals affirming the judgment of the circuit court is reversed for want of jurisdiction in the former court, and the cause is remanded, with directions to dismiss the appeal prosecuted to that court, and for such further proceedings in the circuit court as may be consistent with law.