American Bonding Co. v. Second Nat. Bank

Citations

• 33 Ohio C.C. Dec. 502
• 22 Ohio C.C. (n.s.) 177

Syllabus

<p>PARITES — PRINCIPAL AND SURETY — TRUSTS AND TRUSTEES</p> <p>1. Promiscuous Use of Incorrect Appellations of Party not Mistaken identity.</p> <p>The promiscuous use in the papers in the case and on the docket of the court of the names American Bonding Co. and American Bonding & Trust Co. as that of the plaintiff in the case, does not indicate uncertainty as to the identity of the party or that the court was not properly advised with reference thereto, when the correct name was used in the judgment and the motion for a new trial without objection on the part of the defendant.</p> <p>2. Purchase of Highest Form of Investment by Trustee, Confirmed by Court Held Regular.</p> <p>When a trustee purchases with funds in his hands bonds constituting the highest form of investment known to the law, and the investment is reported to the court in his account which is confirmed in due course, such confirmation operates as an approval of the investment as fully as though a prior formal order had been made.</p> <p>3. Bank Purchasing Bonds from Trustee1 Charged with Knowledge of Trust.</p> <p>There is no presumption in law of authority on the part of a trustee to sell bonds held by him in trust, and those purchasing from him without a showing of authority to sell will be charged with knowledge that he was probably violating his trust; hence, a bank making such a purchase with knowledge that the bonds were held in trust will be held liable for the loss resulting from conversion of the proceeds, notwithstanding it paid full value for the bonds and was in no way in collusion with the trustee in his breach of trust.</p> <p>4. Payment of Surety of Trustee for Conversion of Bonds no Abatement of Action Against Bank Purchasing Bonds.</p> <p>The successor in the trust having brought an action against the bank for the loss thus sustained, payment of the loss by the surety during the pendency of the suit does not abate the action but it continues in favor of the surety by subrogation, and