Fidelity & Deposit Co. v. Beneficial Loan Ass'n

Sloan, J., delivered tbe opinion of tbe Court. Tbe Beneficial Loan Association of Newark, N. J., tbe appellee, witb an office in Baltimore, secured from Tbe Fidelity and Deposit Company of Maryland, tbe appellant, on October 1st, 1919, an indemnity bond, whereby tbe appellant agreed “to indemnify * * * tbe employer (tbe appellee) against tbe loss of any money or other personal property (including money or other personal property for which tbe employer is responsible) through tbe fraud, dishonesty, forgery, theft, embezzlement or wrongful abstraction of any employee named in tbe schedule forming part of” tbe “bond, directly or in connivance witb others, while such employee bolds any position at any place in tbe service of tbe employer while” tbe “bond is in force.” Tbe term of tbe bond began on October 1st, 1919, and expired October 1st, 1920. A bond of like tenor and effect was executed December 21st, 1920, for tbe year beginning December 6th, 1920, and expiring December 5th, 1921. One of tbe employees scheduled witb tbe bonds was B. T. Walter, manager of tbe employer’s Baltimore office, in tbe sum of $2,000, and it is for bis alleged shortages suit was brought on both bonds.

If there is liability in this case under tbe evidence, it is on tbe first bond, as tbe alleged misappropriation, according to the appellee’s theory and evidence, occurred in April, 1920. The case ¹⁹⁰ was tried in the Baltimore City Court before Judge Duffy, sitting as a jury, who rendered a verdict in favor of the appellee for $657.20, and from the judgment thereon this appeal was prayed. With the declaration the appellee filed a bill of particulars on which it claimed indemnity, showing balances on thirteen loans and one unnumbered item designated “shortage in bank, $60,” amounting in all to $2,639.29, and credited thereon as items admitted and paid, $526.75, leaving the balance sued for, $2,112.24. The evidence appears to be confined to the transactions of the'appellee with one Taylor O. War-din as follows: Loan Ho. 4236, January 30, 1920, balance due, $205.00; loan Ho. 4615, May 3, 1920, balance due, $273.00; loan Ho. 4704, June 29, 1920, balance due, $260.50, and loan Ho. 4611, April 3, 1920, balance due, $257.00, and of these recovery was only claimed at the trial on loans 4615 and 4611, which, with interest, $127.20, amount to $657.20, for which judgment was entered.

The items included in the verdict and judgment show from the evidence that this case is concerned only with the checkered career of a broken down automobile. The appellee was engaged in the petty loan business under article 58A of the Code, whereby it was limited to loans not in excess of $300 at any one time to any person at rates exceeding six per cent, per annum, loans made within the law allowing interest up to three and one-half per cent, per month. In the present case it appears that the two loans on which judgment was recovered were originally for $300 each, though according to the evidence they constituted one loan of $600, secured by chattel mortgages on an automobile. The appellant contends that this was an illegal transaction, for the reason just stated, and therefore not recoverable in suit against the surety.

Because of our opinion of the whole evidence we do not find it necessary to express an opinion on this point. The evidence shows that the appellee, in December, 1919, had a Ohalmers touring car on its hands, which it sold to ¹⁹¹ one Alfred O. Blades for $600, talcing two chattel mortgages on the car for $300 each in payment. Blades had the car about one day. The car stopped on the street in Baltimore, where Blades abandoned it, ’phoned to the appellee’s office to take it, and after leaving it there two or three days, Walter, appellee’s manager, had it towed to a garage.

Blades testified that he paid no money on the car and received nothing out of the mortgages. Taylor O. Wardin testified that he had had a loan from the appellee prior to his automobile transaction. He was in ill health, had been advised to go to the Sabillasville Sanitarium, and was without means. He said he had gone to Robert T. Walter about March, 1920, and arranged to buy the Chalmers car, and about April 3rd closed the transaction by taking the car and gave two chattel mortgages of $300 each in payment; that he intended to use it at the sanitarium for hacking or taxi purposes, and it was understood with Walter that he would pay for the car out of the proceeds of the business.

The car broke down in two days and he “kept repairing it but it would not run,” and early in June the appellee had it