Mitchell Grain & Supply Co. v. Maryland Casualty Co.

Citations

• 108 Kan. 379
• 195 P. 978
• 16 A.L.R. 1488
• 1921 Kan. LEXIS 51

Syllabus

<p>SYLLABUS BY THE COURT.</p> <p>1. Defaulting Employee — Report of Accountant as to Shortage. The evidence as a whole is held not to show that the report of an accountant as to a shortage of an employee was arrived at upon an improper basis.</p> <p>2. Indemnity Bond — Shortage of Employee — Interpretation of Word “Embezzlement” as Used in Bond. In a bond insuring an employer against losses sustained by reason of conduct of an employee constituting embezzlement the word “embezzlement” is to be construed broadly in its general and popular sense, rather than in a narrow and technical spirit with specific reference to the local statute; and a loss occasioned by the employee’s speculating on the market'in the name of the employer, but without his knowledge or consent, is within the protection of the bond.</p> <p>3. Same — Employer’s Warranty that Boohs Shall Be Inspected Every Three Months. Where a contract of insurance against losses through the embezzlement of an employee contains a warranty on the part of' the employer that the' books shall be inspected, audited and verified at -least once in three months, this requirement is met by an examination conducted by the officers of the employing company, and does not involve the employment of an expert accountant for the purpose; nor does the fact that the examinations that were made failed to disclose .shortages that were afterwards found to have existed necessarily show any breach of the warranty.</p> <p>4. Same — Requirement that Employee’s Shortage Must Be Discovered Within Six Months. After Discharge. The requirement of a bond of indemnity against the results of embezzlement by an employee that losses to be covered by it must be discovered within six months after his discharge is met where within that period the fact of a shortage becomes known, although its exact ainount is not ascertained until later.</p>