U.S. Supreme Court
Smythe v. United States, 188 U.S. 156 (1903)
Smythe v. United States
Argued November 12, 1902
Decided January 26, 1903
188 U.S. 156
An action upon the official bond of a Superintendent of the Mint at New Orleans, conditioned, among other things, that he would "faithfully and diligently perform, execute and discharge all and singular the duties of said office according to the laws of the United States" and "receive and safely keep, until legally withdrawn, all moneys or bullion which shall be for the use.or expenses of the Mint." The claim was that the defendant had received and not paid over to the United States $25,000 in treasury notes which had come to his hands. The defense was that the treasury notes had been totally destroyed by fire, without any negligence on the part of the Superintendent, except that $1,182 of such notes had been recovered in a charred condition and turned over to the United States, being in such condition that they could be identified as to amount and date of issue. Held:
(1) That the obligations of the Superintendent were not determinable by the law of bailment, but by the terms of his bond, and he could not escape responsibility for treasury notes that came to his hands and which were lost unless such loss was attributable to overruling necessity or the public enemy; that their loss by reason of fire constituted no defense.
(2) No deduction could be allowed on account of the $1,182 of charred notes, because no previous application had been made to the proper accounting officers for the allowance of such a credit.
(3) The Superintendent was liable on his bond for interest at six percent from the date on which his accounts were stated at the Treasury Department.
This was an action upon the official bond of Andrew W. Smythe as Superintendent of the Mint of the United States at chanroblesvirtualawlibrary
New Orleans to recover the sum of twenty-five thousand dollars with six percent interest from April 1, 1893, until paid -- that being the amount found due to the United States at the date of the examination, adjustment, and statement of his accounts by the proper officers of the Treasury. The sureties on the bond were Edward Conery and David Chambers McCan.
The bond was conditioned that the Superintendent should
"faithfully and diligently perform, execute, and discharge, all and singular, the duties of said office according to the laws of the United States, then this obligation to be void and of no effect, otherwise to remain in full force and value."
When this bond was executed, it was provided by section 3500 that every officer of the Mint, before entering upon the duties of his office, should take an oath faithfully and diligently to perform the duties thereof; by section 3501, that the Superintendent, before entering upon his office, should become bound to the United States, with one or more sureties, in a named sum, "with condition for the faithful and diligent performance of the duties of his office;" by section 3503, that the Superintendent of each Mint
"shall have the control thereof, the superintendence of the officers and persons employed therein, and the supervision of the business thereof, subject to the approval of the director of the Mint;"
by section 3504, that
"he shall keep and render quarter-yearly to the Director of the Mint, for the purpose of adjustment according to such forms as may be prescribed by the Secretary of the Treasury, regular and faithful accounts of the transactions with the other officers of the Mint and the depositors,"
and by section 3506 that
"the Superintendent, of each Mint shall receive and safely keep, until legally withdrawn, all moneys or bullion which shall be for the use or the expenses of the Mint."
It appeared in the evidence that the defendant Smythe, as Superintendent of the Mint, received various sums of money in United States Treasury notes, and that, upon a statement of his accounts by the proper officers of the Treasury, there was a deficit of $25,000.
The defense was that the $25,000 of Treasury notes was placed by the Superintendent in a tin box in the steel vault chanroblesvirtualawlibrary
provided by the government for the safekeeping of public funds in his custody, and that the notes, while in that box, were charred, burnt, and destroyed by fire that occurred in the vault without any negligence on the part of the Superintendent or his agents or employees.
The government insisted at the trial that, even if the Treasury notes were destroyed in the manner and to the amount claimed, without negligence on the part of the Superintendent, nevertheless he was liable on his bond -- its contention being that he was under the obligations, practically, of an insurer in respect of all public funds coming to his hands, and could not be relieved unless the loss occurred by the act of God or the public enemy. This view was approved by the circuit court, which, at the conclusion of the evidence, directed a verdict against the defendants, and judgment was accordingly rendered for the full amount claimed by the United States. The court added the following words to its memorandum of reasons for that direction:
"In this cause, there has been no charge or intimation that Dr. Smythe was personally at fault or blameable in any way. Such fault or negligence as may have been shown in the cause is attributable to his subordinates, and in no manner to him."
The circuit court of appeals approved the view taken by the circuit court and affirmed the judgment. The opinion of the former court is reported in 107 F.3d 6. chanroblesvirtualawlibrary