text:
    Reed’s Executors versus Reed.
    1. Where au owner offered to pay a broker a certain sum to obtain a purchaser for his property, and the broker procured parties to enter into negotiations for the purchase, and pending these negotiations, the owner allowed these parties five or six weeks’ time to decide upon terms made by him in answer to theirs, a contract relation was created, which was violated by a sale by the owner to third parties within the time allowed, and the broker was entitled to recover the stipulated compensation.
    2. The failure of the broker to protest against the sale of the property to third parties, when he was inforined it was about to be made, was not necessarily fatal to his right to recover, and the effect of his silence was properly submitted to the jury.
    3. Where the broker’s name was signed to the paper, containing the offer to purchase the property, and his participation was not sought to be concealed, and he acted openly and fairly, his right to recover commissions was not affected by the fact that he was one of the intended purchasers.
    October 16th 1876.
    Before A&new, C. J., Sharswood, Mercur, Gordon, Baxson and Woodward, JJ. Williams, J., absent.
    Error to the Court of Common Pleas of Erie county: No. 84, of October and November Term 1875.
    This was an action of assumpsit, brought by W. W. Reed against Harriet W. Reed, executrix, and 0. M. Reed and J. 0. Harrison, executors of Charles M. Reed, deceased. ■
    The declaration set forth, that the deceased, Charles M. Reed, entered into a contract with the plaintiff to procure a purchaser for what was known as the Erie canal, running through Pennsylvania from the city of Erie to the Ohio river, in which improvement the deceased ivas the principal stockholder and otherwise largely interested, and that deceased agreed to pay to plaintiff $10,000 if he procured a purchaser and effected a sale of the canal, which sale plaintiff effected, wherefore the deceased became liable to pay plaintiff the sum of money above mentioned.
    The evidence disclosed these facts: That in the latter part of July 1870, Henry Rawle being with General Reed, the deceased, at his house in Erie, W. W. Reed, the plaintiff, who was superintendent of the canal in question, came into the room, and after some talk, General Reed expressed a desire to dispose of the canal, as it was a matter which annoyed him; that he was not able to get about and did not meet with the active business men along the line of the canal very often; and just as Mr. Rawle and the plaintiff were about to leave the room, • the general said to plaintiff, that if he would get up a party to buy the canal and relieve him of the care of it he would give him $10,000, which amount it appeared was not conditional upon any particular sum for which the canal should be sold. Shortly thereafter the plaintiff and Mr. Rawle went "to Sharon, and thence to Pittsburgh, and interested several parties in the project, who met in Erie on the 9th of August 1870 and in a body went to the house of General Reed and made a proposition to him to purchase the canal. It was in evidence that the plaintiff was the principal in securing the co-operation of these parties, Mr. Rawle becoming one of the parties to purchase, but having no interest in the commissions to be received by plaintiff. The proposition made by these gentlemen at this meeting Avith General Reed Avas afterwards embodied in a formal offer to purchase, in writing, the amount named being $200,000. The plaintiff himself was one of the parties who signed the proposition. About a week after this meeting General Reed made a counter-proposition in writing to these parties, with the modification, that the price to be paid should be $250,000, and some other minor conditions. After the meeting at the house of General Reed, the Pittsburgh gentlemen of those who had signed the offer, started to the east on a pleasure trip, and it seemed to- be the understanding that the parties making the offer Avere to have the refusal of the purchase until the return of those who had gone east. About the middle of September, General Reed informed Mr. RaAvle, who with Mr. Met-calf and the plaintiff were an advisory committee of the parties wanting to make the purchase, that he would give them no longer than to three o’clock of that day to decide whether they would take the canal on the terms of his counter-proposal. The committee having no power to conclude any arrangements, General Reed addressed a note to Mr. Rawle and plaintiff in these words: “ My proposition for the sale of the Erie canal not having been accepted by you is hereby withdrawn,” and upon the same day, the 15th of September 1870, the canal was sold to Mr. W. L. Scott, the president of the Erie & Pittsburgh Railroad, and was afterwards transferred to the railroad.
    The canal competed with the railroad for the business of the section through which it passed, and Mr. Scott testified, that he did not think he Avould have purchased it and paid the price he did had no other negotiations been pending for its purchase. The parties who signed ‘ the offer were responsible, and Avere .willing and anxious to make the purchase, even to doubling their subscriptions. Their signatures Avere in the main procured at the solicitation of the plaintiff; • It appeared, also, that most of them know nothing about General Reed’s'counter-proposal until the sale ;to Mr. Scott.It was in evidence also, that General Reed had confidentially informed plaintiff that he had an offer from Scott, and that plaintiff admitted that he had made no objection at'the time'.
    The following'points were presented by defendants -
    1. If the jury believe from the evidence that’ some time in July 1870 there was an agreement between General Charles M. Reed and the plaintiff, by which plaintiff was authorized to sell the Erie canal, as the agent of General Reed, before the plaintiff is entitled to recover he must show to the satisfaction- of the jury "that he, plaintiff, made a sale or procured a sale to be made of the said canal.

    Answer :• “Refused, because no evidence of such a contract.”
    6. That General Reed had a right to withdraw the proposition
    made to the parties proposing to purchase, before their notifying him of their acceptance, and also had’the sight-to withdrawthe proposition made to plaintiff, and if he did withdraw it the plaintiff is not entitled to recover. ■ ! - ■'
    Answer: “ Affirmed, if no time was fixed for acceptance.”
    7. That the agreement between General Réed añd plaintiff, testi-
    fied to by Henry Rawle, of-July 1870, could not be enforced in law for the want of mutuality. 1 - ■ •
    Answer: “Refused.”
    8. If General Reed communicated to plaintiff: his intention of making the sale to William L. Scott,' before the sale was made; and plaintiff did not protest against it or claim- his commission, plaintiff cannot recover.
    Answer: “Refused, but refer to'general charge.”
    9. Upon the whole evidence, the plaintiff is not entitled to' recover. - 1 ■ .....-
    Answer: “We' decline’ so "to' charge, for we- cannot withdraw the facts from you.” • :-
    5: If plaintiff acted with the parties proposing to purchase, -and in their interest, it was'against the interest of General Reed, and plaintiff is not entitled to recover.
    Answer: “Affirmed, if he acted adversely'to General Reed’s interest.” ° - • •
    The court (Vincent, P. J.), in their general charge, inter alia, said:— * ‘

      í<r A party was made-up by the efforts of th'e plaintiff, the membefs of which were willing to buy General Reed’s interest, and they made to him a written offer to pay-$200^000 for it. - When this proposition was presented to General Reed he did not accept it, but made a counter-proposition to them, offering to take $250,000-for his interest.- The proposition was never accepted'by the proposed purchasers, and the most of them say they never heard of it-until after it had been sold to another party. This occurred about the middle of August 1870, and up to this time no party had been found that had agreed to take Reed’s interest in the canal at the price at which he was willing to sell it. If this was all, General Reed had a perfect right to recall his offer at any time, and unless the party that was made up acceded to his ultimate terms, the contract between the plaintiff and General Reed would be at an end. [But if General Reed gave to the party organized by the plaintiff five or six weeks in which to accept or refuse General Reed’s counter proposition, and before the expiration of that time the offer was withdrawn on a few hours’ notice and before it was possible to communicate with the parties desiring to purchase, and then the party were unable to perfect the purchase, and not because of their unwillingness to accept the proposition of General Reed, we think the plaintiff had complied with his part of the contract and is entitled to recover, unless he has forfeited his right for some other reason.]
    “ The plaintiff was, in one sense of the word, the agent of General Reed, at least to the extent of requiring from him perfect good faith towards the general in the whole proceedings.
    “ No price having been fixed by General Reed at which his interest would be sold, it was the duty of the plaintiff to get as good a price for the interest as he could induce the party to offer, and it was clearly his duty to make known to General Reed the utmost price which his party would give, if it was known to him. If he knew that his’ party was willing to pay $250,000, it was not good faith to General Reed not to let him know that fact, and his failure to do so would forfeit all claim on his part to any compensation for what he had done, and in that case he cannot recover. There was nothing in the relation between the plaintiff and General Reed that forbade the plaintiff to become openly one of the purchasing party, and especially when General Reed took no exception to his standing in that relation. If General Reed gave no specified time for the consideration of his proposition of sale, he could recall his offer whenever he pleased and sell to another, and the plaintiff would not thereupon have a right to recover the amount promised in case he got up a party to take the canal, for he did not get up a party willing to take it on terms that General Reed would agree to, and that the subsequent sale showed were not unreasonable. General Reed was not bound to take any price the party organized to buy saw fit to offer. He had a veto power over the whole matter until the party came to his terms. If General Reed told the plaintiff that he intended to withdraw the proposition he had made, and it was received by him without any protest that the time given had not elapsed, it is strong evidence that he did not understand that any time was given, as testified by Mr. Metcalf, and it is to be considered by you that no one of the parties proposing to buy testify that they were to have five or six weeks to make their decision on General Reed’s offer.”

      The verdict was for the plaintiff, and judgment was afterwards entered for the sum of f12,460, principal and interest from October 15th 1870.
    The defendants sued out this writ, the portion of the charge in brackets constituting the first assignment, and the refusal of the several points of the defendants in the order mentioned heretofore the second, third, fourth, fifth, sixth and seventh assignments of error.

      James Q. F. F. Marshall and S. F. T. 8. Woodruff., for plaintiffs in error. —
    To render a contract binding it must be acceded to by both parties at the time: Lyon v. Fessler, 7 Watts 48; 1 Pars, on Con., chap. 2, sect. 1, title, “ Assent of Parties,” and cases cited. If the offer is withdrawn within the time for its performance and after its acceptance by the broker, there can be no recovery : Coffin v. Landis, 5 Phila. R. 176; 1 Pars. Con. 482. Mutuality essential to complete a contract: Donaldson v. Kerr, 6 Barr 487. Commissions cannot in general be recovered unless there is a valid sale capable of being enforced by both parties and resulting in a debt due or owing for the price: Kellogg v. Conklin, 6 Phila. R. 177 ; Longstreth v. Long, Id. 179. Vendor must accept purchaser before commissions can be claimed: Pratt v. Patterson, 7 Phila. R. 135.
    Brokers are not even allowed commissions where the principal prevented the consummation of the bargain: Read v. Rann, 21 Eng. Com. Law Rep. 106; Broad v. Thomas, 20 Id. 62. Nor where he has not been immediate cause of sale: Green et al. v. Mules, 100 Eng. Com. Law Rep. 868; Keys v. Johnson, 18 P. F. Smith 42. Nor where the terms of the employer are not exactly met: McGarock v. Woodlief, 20 Howard 221. Party may employ broker and yet negotiate himself: McClave v. Paine, 49 N. Y. 561; Hungerford v. Hicks, 39 Conn. 259. To obtain commissions broker must have procured buyer and at the price named by owner: Clendendon v. Pancoast, 25 P. F. Smith 213.

      C. B. Curtis and L. 8. Norton, for defendant in error. —
    Where a party contracts to procure a purchaser for a property and has complied with his part of the contract and the other party fails to fulfil his part, the broker may receive compensation agreed upon: Edwards v. Goldsmith, 4 Harris 43; Hall v. Rupley, 10 Barr 231; Where a broker authorized to sell has commenced negotiations, pending the same, the owner cannot sell and refuse to pay commissions : Keys v. Johnson, 18 P. F. Smith 42; Earp v. Cummins, 4 Id. 394; Moses v. Bierling, 31 N. Y. 462; Barnard v. Monnot, 40 N. Y. 203; Clapp v. Hughes, 1 Phila. R. 382; Kock v. Emmerling, 22 Howard 69; Young v. Hunter, 6 N. Y. 204.
   Mr. Justice Woodward

delivered the opinion of the court, January 2d 1877.

There was technical error in the answer to the first point of the defendants below. The declaration set out a contract on the part of Charles M. Reed to pay the plaintiff the sum of $10,000, if he “ would procure a purchaser of and effect a sale of what was known as the Erie canal, in which General Reed was the principal stockholder and largely interested.” This was followed by an averment that a purchaser had been secured, a sale effected, and his part of the agreement performed by the plaintiff. The point was in these words: “ If the jury believe from the evidence that some time in July 1870 there was an agreement between Charles M. Reed and the plaintiff, by which plaintiff was authorized to sell the Erie canal as the agent of General Reed, before the plaintiff is entitled to. recover he must show to the satisfaction of the jury that he made a sale or procured a sale to be made.” The answer was: “ Refused because no evidence of such a contract.” The disposition of the point thus made was entirely inadequate. The effect of it was to sever all connection between the case which the pleadings presented and the case which the evidence made out. The interpolation of the words “as the agent of General Reed,” into the point did not justify the answer, for the jury were told, in- another connection, that “ the plaintiff was in one sense of the word the agent of General Reed, at least to the extent of requiring from him perfect good faith towards the general in the whole proceedings;” In the general charge the relations of the parties were described with sufficient accuracy, but when the jury were told that there was no evidence of the contract averred in the declaration, the whole case was adrift, and thé grounds of the verdict for the whole amount of the plaintiff’s claim must have been chance and conjecture.

In other respects the governing questions in controversy, so far as they were developed, were properly ruled. If the plaintiff acted upon the proposition made to him in July 1870, and procured parties to enter into a negotiation for the purchase of the canal, ahd while this was pending, five or six weeks were allowed to those ' parties to decide upon the offer of terms General Reed had made in answer to that which they had presented, a contract relation was created, which was violated by the sale to Scott within the time allowed. It is true that the agreement for the extension of time was without any consideration to support a contract which the parties proposing to purchase could assert. But the rights of the plaintiff -stood on different grounds. He had rendered service, in view of the inducement which had been offered him by General Reed, and when the sale to Scott made it impossible to carry the original agreement into effect, he became entitled to the stipulated compensation. In Edwards v. Goldsmith, 4 Harris 43, where a broker was to receive a definite commission for procuring a purchaser for certain lots of ground, and complied with his part of the contract, but the defendant, without good reason, failed to comply on his part, it was held that the broker could recover in indebitatus assumpsit the amount of compensation agreed upon. And in Keys v. Johnson, 18 P. F. Smith 42, it was decided that when a broker authorized to sell at private sale has commenced a negotiation, the owner cannot, pending the negotiation, take it into his own hands and complete it, either at or below the price limited, and then refuse to pay the commissions. This view of the rights of the parties disposes in substance of the first, third and fourth assignments of error.

The failure of the plaintiff to protest against the sale of the canal to Scott, when he was informed it was about to be made, was not necessarily fatal to his right to recover. It is to be assumed for present purposes that General Reed was aware of all the facts on which the rights of the plaintiff rested. The court charged that the neglect to make objections to the sale was strong evidence that the plaintiff did not understand that any time was given, as testified by Mr. Metcalf,” and they referred to the fact that none of the parties proposing to- buy, except Mr. Metcalf, testified that they were to have five or six weeks to make their decision on General Reed’s offer. The effect of the plaintiff’s silence was rightly submitted to the jury.

If the plaintiff acted openly and fairly in uniting with the other gentlemen who proposed to buy the canal, his right to recover was not affected by the fact that he was one of the intended purchasers. His name was signed to the paper containing the offer, and his participation was not sought to be concealed. The court held that the plaintiff could not recover if he acted adversely to the interests of General Reed, and this was as favorable an answer to their fifth point as the defendants were entitled to receive. The general principle of law is well established. An agent cannot act for each of two contracting parties. He cannot buy or sell, on behalf of his principal, property in which he is interested without making known to his principal all the facts which are known to himself: Taylor v. Salmon, 4 Myl. & Cr. 139. The case of Bollman v. Loomis, 41 Conn. 581, was that of a person acting as the friend and confidential adviser of a purchaser while at the same time he was secretly receiving compensation from the seller for effecting the sale. It was held that this was forbidden by the policy of the law, and that a contract for such compensation was void. Here the connection of the plaintiff with the purchasers was disclosed to General Reed, and he did not require the connection to be dissolved.

In their ninth point the defendants asked the court to charge upon the whole evidence that the plaintiff was not entitled to recover, and the sixth error is assigned to the refusal of the point. In support of this assignment the counsel have subjected the whole of the testimony to elaborate review. Starting with the admitted principle that the plaintiff owed perfect fidelity and good faith to General Reed, the ground was taken in the first instance that this duty was violated by his failure to explain to-,the general the fact within his knowledge, that the parties proposing to purchase were willing to pay $250,000 for the canal at the time when the offer to pay $200,000 was made. This branch of the case was passed upon by the jury. The court said: “If the plaintiff knew that his party was willing to pay $250,000, it was not good faith to General Reed not to let him know that fact, and his failure to do so would forfeit all claim on his part to any compensation for what he had done, and in that case he cannot recover.” The verdict rendered under this instruction was decisive. In the next place it was alleged that the duty rested on the plaintiff promptly to disclose to his associates the counter-proposition of General Reed, and that this duty was wholly neglected. The general facts bearing on this subject, as gathered from the testimony, involve scarcely apparent conflict, and are capable of satisfactory reconciliation. At the meeting of the parties proposing to buy, on the 9th of August 1870, Mr. Rawle, Mr. Metcalf and the plaintiff were appointed a committee to present to General Reed a written offer to pay $200,000 for his interest in the canal. The offer was declined, and a counter-proposition was drawn up in pencil (formally written out and signed a week or two later) and given to Mr. Metcalf, by which the general’s interest was offered for $250,000, and some of the terms suggested by the purchasers were modified. It would seem that the agreement to give the purchasers five or six weeks for consideration must have been at this time made by General Reed. With the counter-proposition in Mr. Metcalf’s hands, the committee returned to the purchasers, and simply reported in the language of Joseph Walton, one of the witnesses, “ that the general was so poorly he could not give a definite answer at that time.” Not one word was said in reference to the terms that General Reéd had proposed. It does not appear that the agreement to give time was reported by the committee. Five witnesses, Messrs, E. A. Wheeler, Samuel Kimberley, James J. Bennett, Joseph Walton and-Thomas J. Burch-field, all testified that they never heard of the counter-proposition until after the sale of the canal to Scott, on the 15th of September 1870. With the facts fully within his knowledge as to the terms his principal was willing to make, it was contended on the argument here by the counsel for the defendants that, apart from the duty he owed to his associates, it was bad faith on the part of the plaintiff towards General Reed to withhold the facts from the purchasers, and permit them to separate with the vague understanding that a second meeting should be held after their return from a pleasure trip to the east, which they were about to make. It was claimed that the plaintiff’s action could only have been taken in order to subserve some selfish purpose of his own, in the acquisition of which the interests of his principal would be sacrificed. And this court were asked, in view of the evidence, to lay their hands upon this record, and to reverse the judgment on this ground. Such a disposition of the cause is impossible for every reason. The testimony was parol, and a jury alone are competent to. establish facts. No point was presented to the court below by which this question could have been brought to their attention, and they were not required to grope for subjects of controversy which the parties did not themselves present.

Judgment reversed and a venire facias de novo awarded.


source: Caselaw Access Project

author: Per Curiam. —

license: Public Domain

text:
    Reed’s Estate. Reed’s Appeal.
    1. Where a residuary legatee is willing to take his share of an estate in stocks, bonds and other securities held by the testator and remaining in the .hands of the executors, he is entitled to do so, and the executors cannot refuse to make a distribution on the ground that they have been unable to convert the securities into cash. :
    2. Where a testator gave a share of his residuary personal estate to his widow, who took under the will, and another share to a daughter who died before him without issue: Seld, that the testator died intestate as to the share given to the daughter, and that the widow was entitled to one-third of the share under the intestate laws.
    October 16th 1876.
    Before Agnew, C. J., Sharswood, Mercur, Gordon, Paxson and Woodward, JJ. Williams, J., absent.
    Appeal from the Orphans’ Court of Erie county: Of October and November Term 1875, No. 85.
    This was an appeal by Harriet W. Reed, executrix, and Charles M. Reed and J. C. Harrison, executors of Charles M. Reed, deceased, from a decree of the court below making a partial distribution of the estate of the testator.
    General Reed died December 14th 1871. By his will, after certain specific gifts, he gave four-twelfths of his residuary estate, real and personal, to his wife, two-twelfths to each of his two sons, two-twelfths to his daughter Nellie, and the same share, less certain advancements, to his grandchildren Alice R. and Marion L. Rawle, children of a deceased daughter. He provided that his real estate should “not be parted and divided” and gave the same to his executors and executrix in trust, with power to improve and sell in their discretion, the proceeds of all sales to be divided in the above named proportions. His daughter Nellie died before her father and after the date of the will, in her minority and without issue.
    . Henry Rawle, the guardian of the grandchildren, filed a petition in April 1873, praying for a division of the personal estate. The executors and executrix in answer thereto averred that the personal estate consisted of hotel furniture, mortgages, notes, articles of agreement, railroad stocks and bonds, &c., and that the same could not be converted into money, and that they had already divided the personal estate as fast as they could convert it into money.
    The court below (Vincent, P. J.) was of. opinion that the personal estate should be divided, in kind, and appointed an auditor to make a scheme of distribution of the securities and assets held by the estate.
    Upon the coming in of the report, the court ordered two-ninths of the personal property belonging to the estate to be transferred to the petitioner, being of opinion that the lapsed residuary gift to the deceased daughter Nellie passed to her two brothers and the children of her deceased sister, in equal parts, and that the widow could take nothing under the intestate act, without refusing to take her residuary share under the will.
    The'executrix and executors took this appeal; the material assignments of error raised the question discussed in the opinion of the court.

      J. Q. F. F. Marshall, for the appellants. —
    The executors have distributed from time to time all money received by them ; they have a right to hold the securities till they can be sold: there is no allegation that they have improperly delayed selling. Articles of agreement for the sale of real estate cannot be divided, as the legal estate is still in the executors.

      Q. B. Curtis, H. Souther, and L. W. Hall, for the appellee. —
    • Stocks, bonds and all securities may be distributed Earp’s Appeal, 4 Casey 373; Dundas’s Estate, 23 P. F. Smith, 480. The appellee does not demand money, but is willing to take his share of the securities and personal assets held by the estate.
   Judgment was entered in the Supreme Court, October 30th 1876,

Per Curiam. —

The right of these legatees to have their legacies is not denied, but the executors refuse immediate payment on the ground that the personal estate consists largely of bonds, mortgages, stocks and other securities, some of which are not due and others are not immediately convertible without loss. Charles M. Reed died and letters under his will were taken out in 1871, this petition was presented in 1873 and the report of the auditor filed in 1874. Sufficient time had elapsed therefore to give the executors an opportunity of converting the estate under ordinary circumstances. There are no known debts, and the legacies were not bequeathed upon a condition, of a contingency. The law authorizes distribution to be made after one year from the granting of the letters. There is no legal reason therefore, why distribution should not be made. The guardian in this case agrees and_ desires to take the legacies of his wards in the assets of the estate in kind, without waiting for collection and conversion by the executors. If this can be done in a reasonable manner so as to produce no loss to the estate and to others interested in it, we can see no good reason against its being done. The court below appointed an auditor to perform the work of fairly allotting the securities, and so far as we can discover, he has accomplished this in a reasonably fair manner. The objection made by the executors is that a guardian has no right to invest in such securities, and therefore has no right to demand them in specie. A guardian having the estate of his ward in possession, clearly cannot invest in such securities as those generally are, and if this were a case of investment the objection would be insuperable. But such is not the case. These securities were the investments of the testator himself, and many of them are in value far below their nominal sums, and the evidence tends to show that they have been in some, indeed in a large number of instances diminishing in value. The executors have held on to them, hoping to sell them at a better advantage. The guardian, however, fears still greater depreciation and prefers to endeavor to convert them, as he thinks he can do, to the advantage of his wards.

Under these circumstances we cannot say the court below erred in directing a transfer of the proportional share of each security to these legatees, so that their guardian may be enabled to realize their values to the best advantage. The executors are not harmed by this, but relieved from responsibility. On the guardian must rest the reponsibility after their receipt. He is liable to render a strict account to his wards for his management of their estate, and especially in a case such as this, where he has exercised his discretion in this manner. He takes upon himself the responsibility of collecting and converting the securities in the most prompt and available manner, to the best interest of his wards, and investing the proceeds according to law. Besides, in permitting him thus to take the assets into his own hands, he is subject to the control of the Orphans’ Court which may make such order for the. security of his wards as in their opinion may be just and reasonable. He may be. required to give further and other security. This is a matter that may be left in the hands of that court, and as this case must go back for correction in a part of the decree, the court may make proper orders to that effect if necessary.

r^There is one respect in which we think the court erred. It is in the respective portions of the estate to which the widow and children are entitled. The effect of the opinion of the Orphans’ Court on this point is to the deprive the widow of her proportion of that part of the residuary estate, which, by reason of a lapse, must be distributed under the intestate law. Whatever the residuary estate may be, great or small, the testator gave to his widow four-twelfths or one-third of this residue. This she became entitled to. by the will of the testator. The death of any one. or more of the- other residuary legatees did not lessen or deprive her of her proportion of the residue under the will, but simply changed the distribution of the part left .without an owner, by reason of the death of the legatee of it in the lifetime of the testator. This lapseddegacy (in this case two-twelfths of the residuary estate) became distributable under the intestate law, as part of the estate not disposed of by the will, when it took effect by and at the death of the testator. Of this he died intestate. His testacy was therefore of only a part of his estate. His widow was therefore put to no election between her legacy under the will and thig undisposed of estate. It was not the intent of the testator or of the law she should take her legacy in lieu of the estate thus lapsed. He thought of no lapse, and therefore .made no provision in lieu of the legacy. The lapse was from the act of God and the law of the land, which do injury to no one. If then the testator by reason of the lapse died intestate of this portion, —the intestate law must govern its distribution, and this being, so what warrant is there for saying .that the widow takes nothing under the intestate law ? She is therefore entitled to one-third, under the will, of the entire residuary estate, and as to that part of the residue which by the lapse is left., without an owner under the will," she is entitled^» one-third of it under the intestate law, and the children living at the testator’s death are entitled to the hther two-thirds in equal proportions. As this change in the decree of the court below will require the matter to go into the hands of the same or another auditor to carry out the decree of this court, and as the Orphans’ Court may think proper to make a further decree for the protection of the minor wards of the guardian, we shall reverse the decree generally, the costs to be paid out of the general estate, and the matter to be farther proceeded in according to the principles of this opinion.

And now, October 30th 1876, the decree of the Orphans’ Court is reversed and set aside, the costs to be paid out of the general estate of Charles M. Reed, deceased, and payment of the legacies of the wards of Henry Rawle, the guardian, to be apportioned and made under the directions of the Orphans’ Court in accordance with the principles stated in the foregoing opinion,' and a procedendo is awarded for this'purpose.


text:
    Thompson et al. versus Lovrein, Hall & Co.
    1. A husband’s consent to his joinder with his wife, in her conveyance of her estate, is fully established by his sealing and signature to the deed, duly acknowledged as his act and deed.
    2. Where the entire language of the deed was that of the wife alone, yet the husband signed and sealed it with her, and solemnly declared it to be his deed for the purposes contained therein, he adopted all that was before his signature, and the purpose of the law was fulfilled.
    October 17th 1876.
    Before Agnew, 0. J., Sharswood, Merger, Gordon, Paxson and Woodward, JJ. Williams, J., absent.
    Error to the Court of Common Pleas of Erie county: Of October and November Term 1875, No. 124.
    This was a scire facias sur mortgage, issued by Lovrein, Hall & Co., to the use of Noble & Hall, against Y. M. Thompson and Rebecca Thompson his wife.
    The writ of scire facias throughout described V. M. Thompson as one of the grantors in the mortgage, the other being Rebecca his wife.
    The mortgage was as follows :—

      “ This indenture, made the 9th day of March in the year of our Lord one thousand eight hundred and sixty-seven, between Mrs. Rebecca Thompson, of the city of Erie, county of Erie, and‘state of Pennsylvania, of the first part, and Lovrein, Hall & Co., of the city, county and state aforesaid.
    “ Whereas, the said party of the first' part, by her bond or obligation bearing date the 9th day of March, in the year of our Lord one thousand eight hundred and sixty-seven, stands bound unto the said party of the second part in the sum of eleven thousand dollars, conditioned for the payment of five thousand five hundred dollars, in manner following, to wit: in two years from the date hereof, with interest, as by the said bond and condition may more fully appear. Now this indenture witnesseth, that the said party of the first part, in consideration of the said debt or sum of five thousand five hundred dollars, owing to the said party of the second part as aforesaid, and for the better securing the payment thereof, with interest thereon, according to the condition of the .said bond, has granted, bargained and sold, and by these presents does grant, bargain and sell unto the said party of the second part, their heirs and assigns, all that certain piece of land situate in the city of Erie aforesaid, bounded and described as follows (here follows description), being the same land conveyed by James Hughes and wife to Mrs. Anna Thayer, and by Oscar C. Thayer and the said Anna Thayer his wife to the said Mrs. Rebecca Thompson, by deed of the 9th of September, A. D. 1863, with all and singular the appurtenances. To have and to hold the said tract of land with the appurtenances unto the said’ party of the second part, their heirs and assigns for ever; provided always, nevertheless, that if the said party of the first part, her heirs, executors, administrators or assigns, shall pay unto the party of the second part, their heirs, executors, administrators or assigns, the sum of five thousand five hundred dollars and interest thereon, according to the condition of the above in part recited bond or obligation, then and from thenceforth these presents and every matter and thing therein contained shall cease and be utterly null and void.
    “ In witness wherof the said party of the first part has hereunto set her hand and affixed her seal the day and year above written.
    Rebecca Thompson, [l. s.]
    V. M. Thompson. [l. s.]
    “ Sealed and delivered in presence of S. S. Spencer.”

      “ Erie county, ss.
    “ Before me the subscriber, a notary public in and for the said county, personally came the above-named V. M. Thompson and Rebecca Thompson his 'wife, and acknowledged the above indenture to be their act and deed, to the end that the same might be recorded as such. She, the said Rebecca Thompson, being of full age, and by me, separate and apart from her said husband, duly examined and the contents of the above indenture fully made known to her, declared that she did voluntarily and of her own free will and. accord, and without any coercion or compulsion on the part of her-said husband, sign, seal, execute and deliver the same.
    “ In witness whereof I have hereunto set my hand and seal this-9th day of March, A. D. 1867.
    S. S. Spencer [l. s.],
    Notary Public.
    Notarial [Seal.]”
    V. M. Thompson in his affidavit of defence averred that he never made, executed or delivered the deed upon which this suit purports to be brought.
    The affidavit of his wife set forth: that at the time of making the above mortgage she was the wife of V. M. Thompson and that he did not join her in the same; that she never made, executed nor delivered the mortgage upon which this scire facias purports to he issued; that on the 9th of March 1867, alone and not joined by her husband, she did sign a mortgage and that the land described therein was her own separate estate in which her husband' had no interest; that at the time of her attempted acknowledgment of said mortgage her husband was in the room, persuading and instructing her to sign; that she vyas not separately examined by the notary before whom said mortgage purported to have been acknowledged and the contents were not then and there made known to her; that she did not declare that she did voluntarily and of' her awn free; will and accord seal and as her act and deed deliver the said conveyance, without any compulsion or coercion of her said husband, and that she never received from plaintiff any consideration for said mortgage.
    It seemed that some payments had been made on the amount named in the mortgage, but in what manner and to what amount did not distinctly appear.
    The defendants pleaded non est factum, payment with leave, &c..
    Before trial the plaintiffs obtained leave to amend the writ by striking out the name of V. M. Thompson wherever it occurred.
    On the trial before Vincent, P. J., the defendants objected to this mortgage, which was offered in evidence, because it was not the instrument set forth in the scire facias, and V. M. Thompson’s name did not appear in the body of the deed as a grantor therein.
    The court said: “ The writ in this case describes V. M. Thompson as one of the grantors with his wife, Rebecca Thompson. The mortgage shows Mrs. Thompson as the sole grantor, recites the bond to be secured as her bond, and throughout the granting; &c., is in the singular number. The writ treats them as joint grantors in the plural number. The plaintiffs propose to show that V. M. Thompson delivered this paper to mortgagees as his act and deed. It is admitted that the mortgage was given for the debt of V. M. Thompson.
    “ The court has great doubts as to the validity of this instrument as the act and deed of V. M. Thompson, but he has sealed and acknowledged it and cancelled the stamp thereon, and we will admit it as the act and deed of both defendants, as far as the validity thereof is concerned, and at defendants’ request seal an exception for them.”
    Mrs. Rebecca Thompson testified: “I owned the land mentioned in the mortgage; I signed it; my husband persuaded me to sign it; mortgage was given for some debt of my husband of which I know nothing; I received none of the money, not a dollar; I signed the mortgage in my own house, my husband the only person present when I signed; I never acknowledged the instrument before anybody; no person ever came to my house to take my acknowledgment to this instrument; I never acknowledged it before S. S. Spencer or any other person; I did sign the paper; I can’t say my husband signed when I did; I did not see him sign it; I did not intend to acknowledge this, and never would have done it;. have acknowledged papers before Mr. Spencer, but not this one; this one was on my house, and I did not intend to acknowledge it. In my affidavit of defence, I meant to say ‘ I signed it,’ instead of ‘ attempted acknowledgment.’ ”
    V. M. Thompson testified: “ Wife owns property recited in the mortgage; I intended this mortgage to take up notes Lovrein, Hall & Co. held against me; no money paid by them; Mrs. Thompson signed mortgage in her own house in my presence; no one .else present; can’t recollect when I signed it; think I signed at the house after she signed; she signed and went out of the room; after sh& signed I took the paper and went to S. S. Spencer’s office and turned down enough of the mortgage to show signatures, and said to him, ‘you know my wife’s signature, and I want you to .make certificate,’ and he made certificate attached to the mortgage; no one present that I recollect of; he hesitated to do it, and I said, ‘ you know her signature, and she will be' down in a day or two, and you can ask her if it is all right; it will be all right;’ he then certified; I then took it to Mr. Hall’s house and delivered it to him, and took up my notes; unless after it was delivered to Hall, she never acknowledged it; I did not intend Mr. Spencer should read the mortgage, and turned it so he could not do it; I got my notes for the mortgage; I did not want Spencer to know what real estate I was encumbering.”
    S. S. Spencer testified: “I was notary public; I made certificate of acknowledgment to this mortgage; the parties acknowledged it before me; I don’t recollect time, except by date of the certificate; I recollect the circumstances; Y. M. Thompson came to my office and asked me to ride to his house; I know Mrs. Thompson signed this paper, for after she had signed she spoke of its being her homestead; Y. M. Thompson was not present when acknowledgment was taken; she said she understood it was the homestead, and she executed it voluntarily; think some other papers were executed at the same time; think there was another mortgage executed at the same time; think I did not read the paper; Mrs. Thompson said she knew the contents; think I only asked her in the usual form of acknowledgment.”
    The following were points submitted by the defendants, with which are given the answers of the court:—
    Second point: The husband must be a co-grantor with his wife, and to make him such he must appear as grantor with his wife in the descriptive part or body of the deed or instrument of conveyance, and words expressive of grant must appear in the conveyance over his written signature before he becomes a grantor, and as the mortgage in this case contains no words expressive of grant by Y. M. Thompson, but all through the instrument it recites it to be the act of his wife alone, and to bind her estate, not the estate of them, the husband and wife, there is, therefore, no joinder on the part of the husband, but the instrument is simply the mortgage of Mrs. Rebecca Thompson, a married woman, consequently void and plaintiffs cannot recover.
    Answer: “We decline so to answer.”
    Third point: The law requires the assent of the husband to make the conveyance of a wife valid, and this must be in writing, which means a written signature to written words expressive of assent, and a written signature without words of assent would not be sufficient, and consequently would amount to nothing.
    Answer.: “Asa general proposition this is affirmed; but we have decided that in this ease the husband gave sufficient assent to bind him if the mortgage is properly acknowledged.”
    Fourth point: There áre no words of assent on part of V. M. Thompson anywhere in the instrument over his signature. There is consequently no such assent as the law requires to make the mortgage of Mrs. Rebecca Thompson binding on her estate, but is simply her. deed without the assent of her husband, and consequently void.
    Answer:. “We decline so to charge.”
    The verdict was for the plaintiffs for $4431.52, and judgment was entered thereon.
    Defendants took this writ, and the errors assigned were the answers of the court to the second, third and fourth points of defendants, and the admission of the mortgage in evidence.

      J. Ross Thompson, for plaintiffs in error. —
    A married woman in Pennsylvania cannot make a valid conveyance of her estate unless the provisions of the Act of February 24th 1770 are complied with. ■That act requires: 1st. That the deed shall be fully made, sealed, delivered and executed by husband and wife, making them joint grantors; 2d. After the execution an acknowledgment before a justice, duly authorized, who shall examine the wife separate and apart .from her husband, and make known to her the full contents of the deed. The wife’s right to convey being the creature of statute law, the prescribed forms must be pursued: Elliott v. Peirsol, 1 Pet. 338 ; West v. West, 10 S. & R. 447 ; McClure v. Douthitt, 6 Barr 414; Peck v. Ward, 6 Harris 506 ; Ulp v. Campbell, 7 Id. 361; Cord, on Rights of Married Women 416. The deed should express the names of the grantors. The consent of the husband is to be determined by his joining with the wife in the execution of the conveyance: Glidden v. Strupler, 2 P. F. Smith 403; and he must be a co-grantor with his wife in the deed, and use apt words, expressive words of grant over his signature: Agricultural Bank of Miss. et al. v. Rice et al., 4 How. 225. Merely signing, sealing and acknowledging an instrument in which another person is grantor is not sufficient: Ibid. See also Dundas et al. v. Hitchcock, 12 How. 256; Powell et ux. v. Monson & Brimfield Man. Co., 3 Mason 347; Purcell v. Goshorn, 17 Ohio 105; Hills v. Bearse, 9 Allen (Mass.) 403.

      Marvin, Benson Brainerd, for defendants in error. —
    Thompson signed the mortgage, acknowledged and delivered it to Lovrein, Hall & Co., and declared under oath on the trial that he had told them it was all right, and he took up the obligation they held and got the full consideration. He is a party to the mortgage, and adopted everything therein over his name, and is bound thereby. The husband being a party thereto the wife is also bound. This case is ruled by Jamison v. Jamison, 3 Wharton 457. Where courts are satisfied that the parties intended to make the mortgage they pronounce the instrument valid: Hills v. Bearse, 9 Allen 403. It was once thought that the grantor should be named as such in the deed, but this does not seem to be necessary if the grantor signs it. Thus, where a deed purported to be that of a married woman, her name only appearing as grantor, but it was signed by her and her husband, who acknowledged it, it was held tobe a good grant of the husband as well as the wife: 3 Washburn on Real Property, 3d ed. 239, and the following cases therein cited: Elliot v. Slack, 2 N. H. 525; Lord Say and Seal’s Case, 3 Bro. P. C. 112. The following are also in point: Woodward v. Seaver, 38 N. H. 29 ; Stone v. Montgomery, 35 Miss. 83.
   The judgment of the Supreme Court was entered, October 23d 1876,

Per Curiam. —

This case differs in some particulars from Jami-son v. Jamison, 3 Wharton 457, yet as the essential thought of a husband’s joinder with his wife in her conveyance of her estate, is his consent to her act, we think his sealing and signature to the deed, duly acknowledged as his act and deed, fully supply the evidence of this consent. True it is that the entire language of the deed is that of the wife alone even to the concluding words, “ In testimony whereof:” yet when the husband signed and sealed it with her, and solemnly declared it to be his deed for the purposes contained in it, he adopted all that was before his signature.- The true purpose of the law is therefore answered.

Judgment affirmed.


author: 'Mr. Justice Woodward

text:
    Wilson versus Brown.
    1. The parties to an action agreed to submit all matters in controversy to arbitrators, their submission to be made a rule of court, and the award to be finally conclusive without the rigKt to appeal. The award found a sum certain to be due plaintiff, directed the equal distribution between plaintiff and defendant of another sum when collected, and imposed on plaintiff the condition of paying the indebtedness included in the'adjustment. A rule to show cause why this award should not be stricken off, because it was not final and conclusive, was made absolute. Held (reversing the court below), that the submission was a substantial compliance'with the first section of the Arbitration Act óf June 16th 1836, and that under the provisions of that statute, the terms imposed by the referees could be carried into effect and their execution enforced. •

      2. II seems that under the provisions of the 6th sect, of the Act of the 16th of June 1836, a voluntary reference hy the “parties to any suit” is limited to a permission to refer the particular questions involved in a pending action, but the 1st sect, of the same act provides for the settlement of all classes of controversies by voluntary arbitration, while for purposes of enforcement and remedy, the 5th sect, aifords ample protection to both parties.
    October 17th 1876.
    Before Agnew, C. J., Sharswood, Mercur, Gordon, Paxson and Woodward, JJ. Williams, J., absent.
    Error to the Court of Common Pleas of Jefferson county: Of October and November Term 1876, No. 133.
    This was an amicable action wherein Theodore Wilson was plaintiff and Henry Brown defendant.
    The facts of the case are siifficiently set forth in the opinion of this court.
    The parties submitted the matters in controversy to arbitrators, who made an award which the plaintiff moved the court to strike off on the ground that it was not final and conclusive and the court struck it off.
    Plaintiff took this writ and assigned for error that the court erred in striking off the award and in making the rule absolute.

      W. F. Stewart and Gordon Corbett, for plaintiff in error.—
    Courts enforce awards whenever this can properly be done and it is not a valid objection to an award that it is upon a condition. Every presumption will be made in favor of an award when it is in pursuance of a submission made by the parties themselves. The cases cited were: Woglam v. Burns & Adams, 1 Binn. 109; Dennis v. Barber & Co., 4 Id. 484; Kunckle v. Kunckle, 1 Dallas 390; Gonsales et al. v. Deavens, 2 Yeates 539 ; McAdams’s Ex’rs v. Stilwell, 1 Harris 90 ; White v. Jones, 8 S. & R. 349 ; Gallup v. Reynolds, 8 Watts 424 ; South’s Adm’r v. South, 20 P. F. Smith 195.

      Jenlcs Winslow and Jenlcs, Ciarle Meredith, for defendant in error. —
    The award of arbitrators should have been as certain and available as the verdict of a jury. The court had no means or power to carry it into effect: Pennington v. Bowman, 10 Watts 285; Coleman v. Lucas, 4 Wharton 347 ; Stanley v. Southwood, 9 Wright 189; Sicard v. Peterson, 3 S. & R. 468.
   'Mr. Justice Woodward

delivered the opinion of 'the court, November 6th 1876.

On the 20th of July 1875, an agreéiñent was made by these parties for the entry of an amicable action, with all the effect of a summons regularly issued and served, and for the submission of all matters in controversy between them to three named referees, who had been mutually chosen. The agreement stipulated that the submission should be made a rule of court, and the parties bound themselves to submit to and be finally concluded by the award of the referees, or a majority of them, and without the right of appeal. The referees met the following day, and after hearing the parties, made an award, finding the sum of $4751.25 to he due to the plaintiff-; directing the equal division, between the plaintiff and defendant, when collected, of $5601.31, the amount of two notes due from Ray & Stible to the firm (which had been composed of these parties) of Brown & Wilson ; and imposing on the plaintiff the duty of paying all existing indebtedness- involved in the adjustment by the referees “ for timber bought and run to market by Theodore Wilson for Brown & Wilson.” On the 23d of September 1875, a motion was made on behalf of the defendant to strike off the judgment on the award because it was not final and conclusive; because the amount of the notes of Ray & Stible had not been divided; and because the plaintiff had not paid the indebtedness of Brown & Wilson. A rule to show cause was granted, and was made absolute on the 4th of April 1876. ' *

Obviously the action of the Common Pleas was controlled by their conviction that this submission was in pursuance of the provisions of the sixth section of the Act of 16th June 1836, in these words : In all cases where the parties to any suit shall, by themselves, their attorneys or agents, consent, to a rule of court for referring the matters in controversy in such suit to certain persons mutually chosen by them, the award of such referees, if made according to the submission of the parties, being approved of by the court, and entered upon the record, shall have the same effect, and shall be deemed and taken to be as available in law as the verdict of a jury, and the party in whose favor such report shall be made, whether plaintiff or defendant, shall have judgment thereon, and the like process for the recovery thereof as on a verdict in an action commenced by such party.” The authorities on which the defendant’s counsel rely to support their exceptions to this judgment are those in which proceedings under the section recited and under acts of similar tenor have been under review. That an award made in the course of such proceedings is bad if it cannot be ■ enforced by execution is firmly settled: Coleman v. Lukens, 4 Whart. 347 ; Pennington v. Bowman, 10 Watts 283; Sicard v. Peterson, 3 S. & R. 468; Williams v. Landon, 14 S. & R. 338 ; Wood v. Earl, 5 Rawle 44. Like the Act of 1705 and the Act of the 21st of March 1806, the section provides that the award shall have the effect of a verdict, and the successful party is entitled to the same judgment and the same process for collection that he could have, demanded if he had been successful in the trial of his action before a jury. There is another peculiarity in the provisions of the sixth section. It is a reference by “ the parties to any suit ” that is authorized, and “ the matters in controversy in such suit” are the subjects of the submission. The scope of these provisions is manifestly limited to a permission to the parties to a pending action voluntarily to refer the particular questions it involves.

A wider field of inquiry was covered by this submission. It was a reference of all matters in controversy between the parties, and it had in view more comprehensive investigation and the use of more flexible machinery than the' terms of the sixth section would allow. There was no existing litigation when the submission was made, and there were no matters in controversy in a pending suit. If the proceeding is sustainable at all, therefore, it must be sustained for purposes both of judgment and enforcement under the first and fifth sections of the Act of 1836. The terms of the first section are: “ It shall be lawful for all persons desirous to end by arbitration any controversy, suit or quarrel, except such as respects the title of real estate, to agree in writing that their submission of the same to the award or umpirage of any person or persons shall be made a rule of any court of record of this Commonwealth having jurisdiction, which the parties shall choose, and they shall insert such their agreement in their submission, or the condition of the bond or promise whereby they may oblige themselves respectively to submit to the award or umpirage of any person or persons.” The fifth section provides: “If exceptions shall not be filed within the time limited as aforesaid” — that is, by the fourth section, “within such time as the court by their rules shall direct” — “or if, upon such exceptions filed, the court shall confirm the award, the party neglecting or refusing to perform or execute the same, or any part thereof, shall be liable to all the penalties of contemning a rule of court, and the court, on motion, may issue process accordingly, or the said court may, on motion, award an execution or executions to carry the same into effect.” The distinction between the two forms of proceeding is palpable on the most cursory examination'. Disputes between parties of every kind which do not relate to land, whether the subjects of-a suit at law or not, may be submitted under the first section of the act to the arbitrament of referees. Where the title of real estate is in controversy, a reference can be made only under the sixth section, and only in a pending suit. It was that section which was the subject of construction by Chief Justice Thompson in Steele v. Lineberger, 9 P. F. Smith 308, where it was ruled that the Act of the 21st March 1806 was supplied by the Act of 1836., It can readily be conceived that the legislature in the wide-reaching provisions they for the first time made for the settlement of all classes of controversies by voluntary arbitration, intended to secure the prompt and efficient adjustment of just such claims as these parties held against each other. They had been partners, and the submission they made preserved them from the expense and delay of a suit in equity or an action of account render. For purposes of enforcement and remedy, the fifth section affords to both, parties ample protection. Only by the permission of the court can tbe plaintiff have execution, and he is subject to all forms of process that may be found requisite to secure the defendant’s rights. The division of the fund to be realized from the Ray & Stible notes, and the payment by the plaintiff of the debts of the partnership, can be readily enforced as the conditions on which an execution will be permitted to issue for the amount of the money award. Certainly, under the broad language of the statute, there can be no embarrassment in carrying into effect the terms imposed by the referees, which involve no greater complication than such as is constantly developed -in actions of ejectment where special circumstances make conditional verdicts requisite.

The submission is not in the literal words of the first section of the act. But it is consistent with them in all respects, and it contains all that is essential that they prescribe. The affidavit required by the second section to accompany the agreement inserted in the submission does not appear in the paper-books, and may or may not be in the record of the suit. But the want of such an affidavit was not made a ground of objection in the Common Pleas, and has not been complained of here. Its absence would make the proceeding voidable simply, and not void: Wall’s Admrs. v. Fife, 1 Wright 894. It was a statutory requirement to entitle the agreement to entry by the prothonotary. The presumption that the requirement was complied with results from the fact that the entry was made.

The order of the Court of Common Pleas making absolute the rule to show cause why the award and judgment should not be set aside is revers'ed, at the costs of the defendant, and it is now ordered and adjudged that the rule be discharged.

Mr. Justice Woodward dissents.


author: Mr. Justice Sharswood

text:
    Porter et al. versus Bright et al.

    1. In an action brought by the buyer of certain coupon bonds which turned out to be counterfeit, to recover the price from the seller, the court below refused an offer on the part of the defendant to prove that he supposed the bonds to be genuine at the time of the sale; that he had made inquiries about them, and told the plaintiff the result of his inquiries; that the plaintiff, before buying, had also made inquiries and satisfied himself and had then bought the bonds ; and that the seller refused to give any guarantee, except that the bonds were not stolen: Held to be error.
    2. Although in ordinary sales the vendor of a bond impliedly warrants his title, yet, in the absence of concealment or false representation by the vendor, an agreement that the buyer shall assume all the risks of the title is not contrary to law.
    3. In this case, it seems, that in the sale of coupon bonds the rule of caveat emptor did not apply. .
    4. Where A. bought certain counterfeit bonds from B. in April 1873, the July coupons having been cut off, and A. did not discover the defect till after January 1st 1874, when he presented the next coupons for payment, and within a few days, A. tendered back the bonds to B. and demanded the return of the price, it seems that A. tendered the bonds within a reasonable time and was not guilty of negligence. •
    October 17th 1876.
    Before Agnew, 0. J., Sharswood, Mercur, Gordon, Paxson and Woodward, JJ. Williams, J., absent.
    Error to the Court of Common Pleas of Erie county: Of October and November Term 1876, No 27.
    Assumpsit by John H. Bright and E. G. Benedict, against Anson Porter and others, doing business as the Corry Savings Bank, to recover the amount paid by them for certain coupon bonds of the city of Corry, sold to the plaintiffs by the defendants, which were alleged to have been counterfeit.
    The sale to the plaintiffs was made .in April 1878. The defendants, at the time of the sale, cut off and retained the coupons of July 1878; the spurious character of the bonds was therefore not discovered till after the coupons bf January 1st 1874 matured. Sometime in January 1874, the plaintiffs tendered the worthless bonds to the defendants, and soon afterwards brought this action.
    The only evidence printed in the paper-books was that of the plaintiffs below. That tended to prove that Bright and Benedict had bought the bonds from the defendants in the ordinary course of business, supposing them to be genuine, without any intimation or suspicion that they were not so, and without any agreement that the buyers should take the risk of the bonds turning out to be counterfeit., It was admitted that the bonds were counterfeit.
    The defence set up was that Bright and Benedict bought the bonds with the knowledge that there might be some defect in them, relying upon their own inquiries as to the genuineness of the bonds, and at their own risk. To establish this defence the defendants offéred evidence to prove that they hafd bought the bonds supposing them to be genuine, after having made inquiry of the treasurer, mayor and clerk of the city of Corry as to their genuineness, and that at the time of the sale the plaintiffs were informed what these city officers had said as to their genuineness; that the defendants had declined to sell to the plaintiffs until after the plaintiffs had satisfied themselves that the bonds were genuine by making inquiries of these officers; that afterwards the plaintiffs called on the defendants and said they had inquired as to the genuineness of the bonds, and were satisfied from what they had heard that they, were genuine; that Anson Porter, one of the defendants, stated to the plaintiffs that he would only sell' them the bonds upon information acquired by the plaintiffs themselves, and would guarantee against nothing except their being stolen bonds; and that the bonds were all inspected by plaintiffs before they bought.
    The plaintiffs objected to the testimony as irrelevant, and the court sustained the objection.
    Among the defendants’ points were these:—

      6. That in the purchase and sale of the said bonds the law of caveat emptor applies.
    “ Refused. We think it does not apply to such a transaction.” -r7. If the jury find from the evidence that the bonds in suit were bought by plaintiffs on the-30th April 1873, and that they did not offer to return the bonds to the defendants until the 19th January 1874, then the plaintiffs have been guilty of negligence and cannot recover in this case.
    “We decline so to charge, but leave it to you as a question of fact. If the plaintiffs made known the character of bonds to the defendants within a reasonable time after they discovered it themselves, they were not negligent.”
    The jury found for the plaintiffs. After judgment the defendants below took this writ of error, assigning for error the -rejection of evidence as above shown and the refusal to charge as requested by the defendants.

      Davenport $ Griffith, for the plaintiffs in error. —
    The jury ought to have been allowed to find what was the agreement between the parties at the time of the sale: Charnley v. Dulles, 8 W. & S. 361; Man v. Drexel, 2 Barr 202; Flynn v. Allen, 7 P. F. Smith 485. The court should have affirmed the seventh point: Raymond v. Barr, 13 S. &. R. 318; Learning v. Wise, 23 P. F. Smith 176.

      iS. P. Johnson, for the defendants in error. —
    Flynn v. Allen rules this case. See also Lyons v. Divellis, 10 Harris 285. The offer of the defendants below did not constitute a good defence. The spurious bonds were worthless, and it was not necessary to return them: Beetem v. Buckholder, 19 P. F. Smith 253.
   Mr. Justice Sharswood

delivered the opinion of the court, October 23d 1876.

We are of opinion that the offer of the defendants below, the rejection of which by the learned court forms the subject of the first assignment of error, ought to have been admitted.

That offer was in substance that the defendants did not know the bonds which they offered to sell the plaintiffs to be counterfeit, but supposed them to be genuine; that they stated to the plaintiffs what they had done themselves to ascertain their genuineness; that the plaintiffs must make inquiry and satisfy themselves upon that point, as they would guarantee against nothing except their being stolen, and afterwards the plaintiffs called cm the defendants and said that they had made inquiries and were satisfied from what they had heard that they were genuine, and the sale was then made.

No doubt every vendor of a bond or other instrument of writing warrants impliedly his title in the same manner as the vendor of any other personal chattel does. If the bond is forged, or its assignment is forged, he has no title, and the vendee can reclaim the price he has paid. It makes no matter whether the vendor knows his title to be bad or not, nor how entirely innocent he may be of any fraud in the transaction. What he has sold proves to be intrinsically worthless. But it would be carrying this doctrine entirely too far to hold that in the absence of concealment or false representation by the vendor, the vendee may not agree to assume all the risk of the title. Why not in the case of the forgery of the instrument as in the case of any other defect of the title, as, for example, that the bond was void for any other reason or that the assignment of it was forged ? There is nothing to .affect such a contract with illegality. Even in equity a vendee of land under articles cannot set up the failure of consideration in consequence of the vendor’s want of title if he expressly agreed to take the risk. “ Where the purchaser is aware of a flaw and provides not against it, he takes the risk of it on himself:” Lighty v. Shorb, 3 Penna. R. 452. The case of Charnley v. Dulles, 8 W. & S. 353, is an authority in point. That was the sale of a certificate of deposit issued by a bank payable to the order of J. S. Skinner, whose endorsement was forged. The vendor had no title, and if the case had there rested the vendee could have recovered back the price. But this court held that the liability of the vendor depended upon the circumstances of the sale, and that it was for the jury to say whether on the evidence the plaintiff took the certificate subject to every risk or not. The endorsement of the vendor there was “ without recourse,” but the court held that to be immaterial. It did not relieve him from the implied warranty of title. “ It was for the jury to say, on all the evidence, what was the understanding of the parties as to the liability of the defendants; whether the plaintiff took the note subject to every risk, as well of the solvency of the parties as of the genuineness of the signature of the payee to the endorsement. If he did, the defendants are not responsible; but if, on the other hand, there was no such understanding, the words ‘ without recourse’ alone do not in law .exempt the defendants from responsibility.” It is very plain that if the evidence proposed to be given by the defendants below had come up to their offer and had been believed by the jury, it would have been sufficient to have justified them in finding that one of the terms of the contract qf sale was that the plaintiffs took themselves the risk of the genuineness of the bonds.

The plaintiffs in error have not furnished us with the evidence in the cause, and without it it is impossible for us to say whether there was anything of which to predicate the points of the answers to which the plaintiffs complain in the second, third, fourth and fifth assignments of error. If the evidence appended to the paper-book of the defendants in error was' all the evidence in the cause it certainly was not sufiicient to raise these points. There was no error in the court’s not charging as requested by the defendants in .their sixth point, “ that in the purchase and sale of said bonds the law of caveat emptor applies,” nor in the answer to the seventh point that “if the plaintiffs made known to defendants the character of the bonds within a reasonable time after they discovered it themselves they were not negligent.”

Judgment reversed, and a venire facias de novo, awarded. .


author: Mr. Justice Mercur,

text:
    Knowles versus Kennedy.
    Where the grantor by deed of warranty had a title which, at the time of the conveyance, was defective, but afterwards acquired an indefeasible title, this title enured immediately to the grantee, and the latter could not elect to reject it and recover the consideration-money paid, in an action for breach of covenant of seisin, but was entitled only to compensation for whatever damages he had sustained.
    October 17th 1876;
    Before Agnew,'0. J., Sharswood, Mer-' cur, Gordon, Paxson and Woodward, JJ. Williams, J., absent.
    Error to the Court of Common Pleas of Erie county: Of October and November Term 1875, No. 151.
    This was an action of covenant, brought by D. C. Kennedy against .
    Daniel Knowles, upon the covenants in the following deed':—
    “ This indenture, made this 15th day of March, in the year of our Lord one thousand eight hundred and seventy, between Daniel Knowles and Jane W. Knowles, of the county of Chautauqua, of the first part, and D. Clinton Kennedy, of the city of Corry, of the second part, witnesseth, that the said party of the first part, in consideration of the sum of $400 to them duly paid, have sold, and by these presents do grant and convey to the said party of the second part, his heirs and assigns, all that tract or parcel of land situated in the city of Corry, being Lot No. four (4) on the west side of Spring street, and being the same land sold by W. H. L. Smith and wife to Wm. A. Knowles, by deed bearing date -on the 7th day of September 1863, with the appurtenances, and all the estate, title and interest therein of the said party of the first part.
    “And the said Daniel Knowles does hereby covenant and agree to and with the said party of the second part, his heirs and assigns, that at the time of ensealing and delivery of - these presents he is the lawful owner, and is well seised of the premises above conveyed, free and clear from all encumbrances; that the premises thus conveyed in the quiet and peaceable possession of the said party of the second part, his heirs' and assigns, he will for ever warrant and defend against any person whomsoever lawfully claiming the same, or any part thereof, by, through or under him, or one William A.
    Knowles, now deceased.
    “ In witness whereof, &c.
    Signed, Daniel Knowles,
    Jane W. Knowles.”

      The deed was duly acknowledged and delivered. Of the consideration $300 were paid down, the balance remaining unpaid.
    The declaration averred, that the defendant covenanted that at the time of the ensealing of the deed he was seised in fee of the land and had the right and authority to sell and convey the same, and that plaintiff, by force of the deed, should lawfully possess and enjoy the same free of all encumbrance; but that the defendant, at the time of executing the deed, was not seised in fee simple of the land, and had no lawful authority to sell the same; that the plaintiff had been evicted from the said land by a title superior to the defendant’s, and that the defendant had broken his covenants to the damage of the plaintiff of $1000.
    The defendant pleaded non est factum, and covenants performed.
    The facts, in brief, were these: William A. Knowles, mentioned in the foregoing covenants, was the son of the defendant, and married to the daughter of the plaintiff at the time of his decease. He died intestate and without issue, but left his widow, a father, brother, sisters and a nephew. Daniel Knowles, his father, after the son’s decease,,came to Corry to attend to matters connected with the administration of the son’s estate, and while there the plaintiff, after some talk about his daughter’s interest in her deceased husband’s estate, proposed to buy the lot in controversy from the defendant. As there was some doubt about the estate defendant had therein, legal advice was sought and taken, and the result was the deed upon the covenants on which this suit is brought. At the time the deed was delivered a bond for $1000 was also given by plaintiff to defendant to indemnify the latter against any claim the widow of William A. Knowles might make to the land.
    It appears that afterwards certain proceedings were instituted by the widow under the Act of 27th of November 1865, Pamph. L. (1866) 1227, for the purpose of having the land set-off to her, and that her petition and the proceedings under it were filed in the Orphans’ Court and confirmed before the. commencement of this suit, but that none of the proceedings required by the act to vest an absolute title in her were taken.
    The defendant afterwards brought suit on a note for $100 given by plaintiff for the balance of the purchase-money and was then notified by plaintiff that he would not pay the note; that the title to the lot was defective ; that the heirs of William A. Knowles, deceased, were the brothers and sisters of said William A. Knowles; that plaintiff did not get a fee-simple title to the land by the deed from the defendant; offered to reeonvey the land and demanded the return of the purchase-money paid and interest for which he brought this action.
    The defendant then procured deeds from all the brothers and sisters of his son, William A. Knowles, the persons alleged by the plaintiff to be the heirs of said William A. Knowles, all of which were put of record and produced on the trial. It also further appeared that the possession of plaintiff in the land had never been disturbed nor interfered with in any way, nor had any one claimed the same by a title paramount.
    What further is shown in the following proceedings will make the case intelligible.
    The plaintiff’s first point submitted to the court below was,
    If the jury find from the evidence, that W. A. Knowles, the son of the defendant, owned the land described in the defendant’s deed to D. C. Kennedy; that the said W. A. Knowles died about 1869; and that the only title the defendant acquired. was by the death of his son (who died without children); that he had not a fee simple estate, and had not a title such as the deed proposes to convey; that the covenant was broken as soon as made, the plaintiff has a right to recover back the consideration paid and interest on the same in this suit.
    His fifth point was,
    That a purchase by the defendant of the outstanding title, after the commencement of this suit, cannot defeat the action, but the plaintiff is entitled to recover, just as though the defendant had never purchased the outstanding title offered in evidence by the defendants.
    Both of which points the court substantially affirmed in the general charge, except as to power to rescind the contract, and this action of the court constituted the fifth and sixth assignments of error respectively.
    The defendant, among others, submitted the following point, which is given with the answer of the court:—
    6. That it appearing in evidence that the defendant has, since the bringing of the action, obtained the title of all the heirs of W. A. Knowles, such title vested at once in the plaintiff, by act and operation of law, and plaintiff can recover no more than nominal damages.
    Refused with a .reference to general charge. This was the eighth assignment of error.
    The court, inter alia, charged as follows, the portions in brackets constituting, in the order in which they are marked, the second, third and fourth assignments of error. “ The plaintiff now contends that by the tender to the defendant of a reconveyance of the land, before defendant had perfected his title to it, and before suit brought, he rescinded the contract, and had a right to bring suit to recover the purchase-money paid by him, with interest.
    “ The defendant, on the other hand, contends that this being an executed agreement, the plaintiff has no power, by his own motion, to rescind the contract, and that having taken possession of the land, he can only recover the damages he has actually sustained by reason of the want of title in the defendant, such damages in no case to exceed the amount of purchase-money paid and interest. The plaintiff concedes that he can, in any event, recover no more than the purchase-money paid and interest.
    “ When a contract for the sale of land has not been consummated by deed, the vendee may rescind the contract at any time, even for a partial failure of title, and sue to recover the money paid on the contract; for the law will not compel a party to accept a title different from that contracted for, and if the vendor cannot give him the title that was contracted to be given, the law will on demand give the vendee back what he had paid.
    “ The law is different in the case of an executed contract. In such a case the vendee has accepted his deed and after that he must resort to the covenants contained therein, for his redress in case of failure of title, without fraud on the part of the vendor. In such a case he cannot rescind the contract, but must sue for damages for the breach, and he is entitled to recover the amount of damages actually sustained, not exceeding the amount of purchase-money paid and interest. If the failure of title be total, he can recover all he has paid with interest; if partial, he can recover in proportion to the failure. If he has himself relieved the title of its encumbrance, he can recover to the extent of the price paid to remove the encumbrance, if it does not exceed the amount of the purchase-money and interest. In this case the title which the vendor, Knowles, covenanted to convey and assure to the plaintiff, was that of the heirs of William A. Knowles, for by the bond given at the same time by Kennedy, he agreed, substantially, that he would take upon himself the risk of any claim then or thereafter to be made by the widow of William A. Knowles.' [The title which the defendant agreed by his deed to convey to plaintiff, had utterly failed when this suit was brought, and at that time the plaintiff undoubtedly had a right to demand a return of what he had paid and interest.] But the defendant contends that plaintiff ought not to recover now, because he has now perfected his title to the land, and is able to give, and in law has given him all the title he covenanted to give. We are not as clear on this point as we would like to be, [but decide that the defendant cannot set up the title acquired by him since this suit was commenced, as a defence to the plaintiff’s demand in this case, nor can the defendant restrict the plaintiff’s recovery to what the defendant paid for the outstanding titles to the land.] It therefore follows that we are of the opinion [that the plaintiff is entitled to recover in this case, for the $300 paid by him, with interest thereon, from the time of the demand for the return of the purchase-money, by the plaintiff.] The foregoing charge answers the plaintiff’s points, substantially, in the affirmative, except as to power to rescind contract.”
    The verdict was for the plaintiff for $358.50 and judgment was entered thereon.
    The defendant took this writ and assigned for error, inter alia, the affirmance ■ of plaintiff’s points, the refusal of the foregoing points of defendant and the portions of the charge in brackets.

      S. B. $ T. S. Woodrufffor plaintiff in error. —
    It is sufficient that the title be good at the trial without regard to its condition when suit commenced: Creigh v. Shatto, 9 W. & S. 83. Equity intervenes and allows the covenantor to perform on making compensation for.his negligence: Haverstick v. Erie Gas Co., 5 Casey 254; damages must be merely compensation for the injury sustained : Withers v. Atkinson, 1 Watts 248 ; Findlay v. Keim, 12 P. F. Smith 116; Terry’s Executor v. Drabenstadt, 18 Id. 400.
    It is only where there has been an eviction from the whole premises that the consideration named in the deed is the measure of damages: Cox’s Administrators v. Henry, 8 Casey 19.
    The covenant of warranty is never broken without an eviction : Paul v. Witman, 3 W. & S. 407. Defendant covenants that he is well seised of the premises free and clear of encumbrances. Such seisin may well be asserted by the tenant for life: Marston v. Hobbs, 2 Mass. 439 ; Bearce v. Jackson, 4 Id. 408; Breck v. Young, 11 N. H. 489; Kirkendall v. Mitchell, 3 McLean 145 ; Griffin v. Fairbrother, 1 Fairf. 95; Baxter v. Bradbury, 20 Maine 260; Backus v. McCoy, 3 Ohio 211.

      Benson Brainerd, for defendant in error. —
    Plaintiff below had the right to abandon the lot when he discovered, defendant had no title. Actual eviction or eviction by suit at law is not necessary to warrant a recovery on breach of contract for seisin: Rawle on Cov., 3d ed. 245; Clarke v. McAnulty, 3 S. & R. 364 ; Greenvault v. Davis, 4 Hill 643; Foster v. Pierson, 4 T. R. 617; Ludwell v. Newman, 6 Id. 458; Hodgson v. The E. I. Com., 8 Id. 278. Plaintiff Was not bound to accept title acquired after suit brought: Blanchard v. Ellis, 1 Gray 195; Tucker v. Clarke, 2 Sandford Ch. R. 96. The covenant was broken the moment the deed was delivered, it being for seisin: Cathcart v. Bowman, 5 Barr 317; Rawle on Cov., 3d ed. 74. Plaintiff had a right to recover purchase-money and interest: Staats v. Ten Eyck, 3 Caines 111; Bender v. Fromberger, 4 Dallas 436 ; Pitcher v. Livingston, 4 Johns. 1; Bennett v. Jenkins, 13 Id. 50; Caulkins v. Harris, 9 Id. 324.
   Mr. Justice Mercur,

delivered the opinion of the court, January 2d 1877..

Thii was an action of covenant. It was brought by the vendee against the vendor on the covenants in a deed conveying land. The vendor covenanted “ that at the time of the ensealing and delivery of these presents, he is the lawful owner, and is well seised of the premises above conveyed, free, and clear of all encumbrances; that the premises thus conveyed, in the quiet and peaceable possesr sion of the said party of the second part, his heirs and assigns; that he will for ever warrant and defend against any person whomsoever lawfully claiming the same or any part thereof, by, through or under him, or one William A. Knowles, now deceased.”

The facts necessary to an understanding of the case are these. William A. Knowles died, seised of the land, intestate, leaving a widow, father, brother, sisters and nephew (the child of a deceased sister), but no issue. The plaintiff in error is the father. He therefore took a life-estate in the land subject to the widow’s statutory right. At the time of the delivery of the deed to the vendee he gave to the vendor a bond indemnifying the latter against all claim then or thereafter to be made by the widow' of said William A. Knowles for or on account of the lands. The vendee thus substantially took on himself the risk of all claim the widow might assert, and now makes no complaint arising therefrom. The vendee went into possession of the land under the deed. His possession has not been interfered with by the vendee or by any one claiming by title paramount. Subsequent to the conveyance and before the commencement of this suit, the widow of William A. Knowles, by application to the Orphans’ Court of Erie county, elected to have three hundred dollars’ worth of property set off to her out of said lands. The appraisers appointed for that purpose reported that the land was of greater value than $300, and that it could not be divided without injury to or spoiling the whole, which was confirmed by the court; but no further action appears to have been taken therein.

Before commencing this suit the defendant in error offered to reconvey the land to the vendor, and demanded a return of the purchase-money paid. After suit brought and before trial the plaintiff in error procured deeds of conveyance from all the holders of the outstanding title to the land, except the widow, and caused them to be duly recorded. This after-acquired title enured to the benefit of the defendant in error, thus perfecting his title: Wolf v. Goddard, 9 Watts 547; Baxter v. Bradbury, 20 Maine 260.

The court below held, the language used created a covenant on the part of the vendor that he was seised of an estate in fee simple, and the vendee was entitled to recover the purchase-money he had paid, with interest thereon from the time he had demanded its return. All the assignments of error except the 1st, 9th and 10th are predicated on this ruling and may be considered together.

There is no averment in the deed, that the vendor was seised of an estate in fee; nor is it averred that he was seised of an indefeasible estate. Even the usual words “grant, bargain, sell,” are wholly omitted, and “grant and convey” are substituted. The covenant of warranty is special. It is to defend against persons lawfully claiming under the vendor or under William A. Knowles, deceased.

In fact the vendor was the lawful owner of a freehold estate in the land conveyed, and was well seised of the same. The vendee did not become liable to accounkto any one for the rents, issues and profits of the land during his occupancy thereof. He was’ not evicted by any adverse proceedings. His enjoyment of the premises during the life of the vendor was secure. No one claiming under the vendor or under William A. Knowles had disturbed the vendee in his possession. The vendor by his covenant of special warranty was bound to protect the vendee against the outstanding title of the heirs of William A. Knowles. He did this by a purchase of their title. It was held in Baxter v. Bradbury, supra, that if the grantor by deed of warranty had nothing in the estate at the time of the conveyance, but acquired a title afterwards, this title enures to the grantee immediately by way of estoppel, and he cannot elect to reject the title and recover the consideration-money paid in an action for breach of the covenant of seisin ; but is entitled to merely nominal damages where no interruption of the possession has taken .place, and to the damages actually sustained when there has been. In Haverstick v. The Erie Gas Co., 5 Casey 254, it is said in strict law whenever a covenant is broken, the plaintiff is entitled to recover full damages for its breach; but equity intervenes and allows the covenantor to perform on making compensation for his negligence.

The declaration in this case avers, that in consideration of $400, the plaintiff in error sold the land, to the defendant in error, and covenanted he was seised in fee of the same, &c., and charges that he was not so seised. It also avers the payment of $300 of the purchase-money, and claims the plaintiff therein is damaged to the amount of $1000. The claim is not to recover the money paid, but damages more than threefold. It is not in rescission of the contract, but in affirmance thereof, and damages for its breach.

It is true the purchase by the plaintiff in error, of the outstanding title, after suit brought, could not defeat the right of action ; yet it does affect the measure of damages.' The title which the vendor had conveyed had not wholly failed. The failure was partial only. Compensation is the usual measure of damages. We discover nothing in the evidence in this case to take it out of that general rule. The covenant appears to have been made in. entire good faith.

The defendant in error was entitled to recover nominal damages at all events and such further damages as the evidence shows him to have sustained. The assignments are therefore substantially sustained.

We see no merit in the first and tenth assignments, and no evidence of such knowledge in the defendant in error as to justify the affirmance of the point covered by the ninth assignment.

Judgment reversed, and a venire facias de novo awarded.