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November 29, 2012 (Special Meeting) Page 1313
<br />record. So you've had a chance to read it, questions... whatever you need to
<br />point out. Comments.
<br />White: I've got one question for Mr. Koch and I've got one question for Mr.
<br />Harris or Mrs. Dubois. I'll start with Mrs. Dubois and Mr. Harris. In the
<br />bonds that we have, that the Board of Commissioners has approved in the past,
<br />how is it that we address the issue in regards to notice if there is an issue
<br />on the bond? Is that if the State of North Carolina is the entity that is
<br />bonded, how does the county government, the Board of Commissioners get
<br />notified if the person - if there is a problem with the bond afterwards? How
<br />does that get addressed?
<br />Harris: Commissioner, currently, the way it's listed now is listing Cabarrus
<br />County, North Carolina and the State of North Carolina as their interest may
<br />appear, and we also list the county's address and it comes in the mail to me.
<br />Cause what happens is it goes to Carolina Governmental Alliance and then they
<br />forward - they forward documentation to us as well.
<br />White: So what I'm saying is, right now if there was in issue with Mrs.
<br />Dubois and the bonding agency said "We're not going to bond her anymore. ",
<br />then a letter would be sent to Tony Harris or a letter would be sent to
<br />county manager or to Risk Management, department head.
<br />Dubois: Attention: Risk Management. We don't name a person, just like you
<br />said earlier, in case that person's not here anymore but (inaudible) title.
<br />White: Okay. And Mr. Koch, I have completely forgot what I was going to ask
<br />you, but I'll remember it. Oh, it's about midway through the front page of
<br />the bond. It says "NOW" - all caps NOW - (inaudible) that paragraph is a
<br />very poorly worded paragraph and implies if Mr. Small does the job that he's
<br />supposed to do, under the duties and responsibilities under the statutes that
<br />the bond is void. And I cannot imagine that being the case, that if he does
<br />what he's supposed to do. Excuse me, not the bond - the obligation.
<br />Koch: That very poorly worded language is pretty standard bond language.
<br />White: But the way it reads, it reads as though if he does what he's
<br />supposed to do lawfully, legally...
<br />Koch: That's correct.
<br />White: That's not just his - that's not - that's in all bonds you say?
<br />Koch: Yes, sir. That's pretty standard language. What it's basically
<br />saying is that at the expiration of the term of the bond if the office holder
<br />has performed the duties of their office in accordance with the statute, or
<br />faithfully such that there has been no claim that could be made under this
<br />bond, then the bond is no longer in effect - that's basically what it's
<br />saying.
<br />Carruth: Because symbolically, that piece of paper is worth $50,000 if
<br />something happens in legal sense or misconduct of the principal, which means
<br />that we have that in our hands, we can get compensation -
<br />Koch: Per occurrence.
<br />Carruth: If they do everything their supposed to do, then that - we can't
<br />execute that bond, we can't claim the money that's (inaudible) by that bond.
<br />White: What if any issue, what if any issue is there that the bond date -
<br />the end date of the bond - is Saturday and the tenure of Mr. Small does not
<br />end until Monday.
<br />Koch: Well there could be a small gap, depending on what time the new
<br />officeholder is sworn in. Because presumably there would be no - the office
<br />would be closed on Sunday - but there, but since it does expire by its terms
<br />on Saturday, if before the new officeholder takes office or if there's a
<br />continuation bond that's obtained, then if there were a claim that arose in
<br />that relatively short gap period, whatever that might be. Since the office
<br />wouldn't open until 8:30 - 9:00 until time when the next person's sworn in
<br />and their bond is in place, then there would be a gap in coverage.
<br />White: And then we fall back onto the issue of race; race to court- race to
<br />the register of deeds. What I'm saying is this: the bond ends on Saturday;
<br />if Mr. Small or a new register of deeds is not sworn in until 1:00 in the
<br />afternoon on Monday, from 8:30 in the morning until 1:00 we either do not do
<br />business or if we do do business, there is no assurances - there is no bond
<br />at that point in time.
<br />Koch: That is correct.
<br />White: And whoever gets to the register of deeds first to file whatever
<br />document for a piece of parcel, they win.
<br />Koch: Well, I think that is a separate issue because that would relate back
<br />to the (inaudible) priority of competing deeds. What I think would be the
<br />ramification of this, albeit small or slight, would be that there would be a
<br />violation of the statute if the office were open for that period of time
<br />until the person is sworn in and there's no bond. And if there were a claim
<br />that arose, albeit later, but because of something that happened in that gap
<br />period there would be no bond in place to cover it.
<br />Carruth: A question I've got and I think Mr. Small alluded to it was that
<br />the bond is renewable every year and would it be that difficult to change the
<br />language that year in the bond to say that it extends until the point in time
<br />at which a new officeholder is sworn in to continue through - or is that like
<br />a holdover situation? To continue until the next person is sworn in or seven
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