Fidelity & Deposit Co. v. Sholtz Ex Rel. Duval County

In the main opinion filed in this cause February 11, 1935, we held that from the proceeds of the bond of Frank Brown as Clerk of the Circuit Court as between the State of Florida and Duval County, the State had a prior right to the payment of tax moneys collected and not reported over the claim of Duval County for fees collected and not reported.

It is contended on rehearing that such an issue between the State and County was not properly presented by the record in this cause and should not, therefore, have been adjudicated. It is asserted, however, that said issue may appropriately be adjudicated in the equity suit referred to in pleas thirteen, fourteen, and sixteen tendered and refused herein by the court below. Said equity suit was brought by the State of Florida against the estate of Frank Brown for an accounting and for other relief, but Duval County nor the plaintiff in error, surety company, are made a party defendant thereto.

In further support of its position the movant, defendant in error, contends that the equity suit in no way relates to or attempts to enforce the obligation against the plaintiff in error, surety company, that the funds claimed by Duval County against Frank Brown are not the funds sought to be recovered in this action on the particular bond of Brown, that the State has made no demand against the surety of Frank Brown, and that none of the pleas tendered and denied herein aver that any claim or demand has been made on the surety of Frank Brown or admit any liability on the *Page 844 part of said sureties, and that the plaintiff in error has at all times denied liability to Duval County.

While the foregoing is in the main correct it is also true that after the reversal of this cause on the former writ of error Fidelity Deposit Company of Maryland filed a suit in chancery in Duval County in which it sought to interplead Duval County, the State of Florida, and other claimants, for the purpose of paying the penalty of its bond into court or settling the question to whom it should be paid. It is also shown that plaintiff in error sought to intervene in the equity suit filed by the State of Florida against the estate of Frank Brown for accounting and to have said equity suit consolidated with its suit to interplead, but that motions therefor in each instance were denied. It is not so apparent why said motions should not have been granted.

It is hardly reasonable to assume that the State will not present a claim against the estate of Frank Brown or the surety on his bond or that said surety will be released and required to pay nothing if defendant in error does not prevail in this litigation. The very purpose of the equity suit was to ascertain the condition of the estate of Brown and the amount of its indebtedness to the State.

The fact that the funds claimed by Duval County in this litigation are not involved with the funds that may be claimed by the State does not preclude the surety company from raising the question of priority between the two claims when it is suggested that the limit of liability on the bond is $5,000.00 and the county and State each claim more than that amount. The bond is made to the State and since the State and county claim more than the penalty named in the bond the settlement of this question is important to the surety company.

From the foregoing it will be plainly seen that the case *Page 845 or the circumstances from which it arises have gotten into an unfortunate huddle and the question of the utmost importance now is the practical one of how best to unsnarl the huddle and do justice to all parties concerned.

In the main opinion we settled the general law on the question of priorities. We do not recede from the doctrine announced in that opinion but in view of the limitation of the penalty named in the bond and the fact that both State and county may have valid claims larger than such penalty it may be that part or all the claims of the county should in equity be paid prior to the claims of the State. It is possible that this question can be determined in the equity suit now pending in the Circuit Court. If it cannot it should be determined in some other proceeding. The liability of the surety company is concluded but since the State and county both lay claim to more than the penalty in the bond it is entitled to be advised to whom it should pay.

We have, therefore, concluded that the former judgment of reversal should stand but without prejudice to the surety company to interplead or institute such other appropriate pleadings as it may be advised for the purpose of determining to whom in equity the fund held by it should be paid, providing this question cannot be adjudicated in the equity suit now pending in Duval County.

Judgment of reversal modified and affirmed on rehearing.

ELLIS, C.J., and BUFORD, J., concur.

WHITFIELD, C.J., and BROWN, J., concur in the opinion and judgment.

DAVIS, J., disqualified.