author: Agnew, J.

text:
    Haines versus Thomson.—Thomson’s Appeal.
    1. Mrs. Hanson being owner of an unfinished house and lot, and her husband indebted to Thomson, she agreed to sell, and Thomson to purchase the property for $30,000 to be paid partly by the husband’s debt and partly in cash; a deed was tendered to Thomson, which he declined to accept; he advanced money afterwards to finish the house; sixteen months afterwards the deed was delivered, Thomson at the same time agreeing by deed to re-convey within four years upon repayment of the amount of indebtedness and the advances, “ if not previously soldif repayment should be made previously, Thomson to retain the premises at $2000 rent until the end of the four years. Two years after the four years the devisees of Mrs. Hanson, alleging that the transaction was a mortgage, brought a bill against Thomson for reconveyance. Held, that the transaction was notyjer se a mortgage.
    2. If there had been nothing but the deed and agreement delivered at the same time, although of different dates it would have been a mortgage.
    3. Proof of an understanding between the parties that the transaction was not a mortgage inadmissible.
    4. When the deed and alleged defeasance are of different dates, evidence of the true nature of the transaction is admissible.
    5. The agreement recited that it was “ the same day and time when said indenture was delivered,” although this primá facie made a mortgage; evidence was admissible to show the reason of the discrepancy of the dates, and that the deed was executed upon a sale and not as security.

    6. The burthen of proof was on the grantor to establish the transaction a mortgage.
    7. Colwell v. Woods, 3 Watts 188 ; Harper’s Appeal, 14 P. F. Smith 315 ; Kerr v. Gilmore, 6 Watts 405 ; Spering's Appeal, 10 P. F. Smith 199, commented on.
    January 29th 1872.
    Before Thompson, C. J., Agnew and Sharswood, JJ. Williams, J., at Nisi Prius.

      Appeal from the decree at Nisi Prius: No. 21, to July Term 1865.
    The bill in this case was brought by Henry Haines and J. Sergeant Price, devisees under the will of Hannah A. Hanson, against John Edgar Thomson and William It. Hanson, also a devisee under the same will.
    The bill averred that in 1858 Mrs. Hanson was the owner of a house and lot at the corner of Eighteenth and Spruce streets, Philadelphia, on which there was a mortgage of $7500; her husband, William R. Hanson, was largely indebted to Thomson; an arrangement was partly effected under which Thomson was to buy the house and lot for $30,000, subject to the mortgage; the consideration was to be paid partly by Hanson’s indebtedness to Thomson and partly in cash. A deed to Thomson for the property, dated May 31st 1858, was executed and acknowledged, and was shortly afterwards tendered to him, but declined, he alleging the price was too high ; the house being unfinished, Thomson advanced money to Mrs. Hanson to enable her to finish it; the sum so advanced was $9000, according to a statement between Thomson and Hanson made in October 1859; Thomson then agreed to advance $15,000 more, and it was agreed the whole $24,000 should be secured on Mrs. Hanson’s house. Mrs. Hanson not being' willing to execute a mortgage, it was agreed that a direct conveyance should be made to Thomson, and he execute a written defeasance; the deed theretofore prepared was delivered to Thomson, October 10th 1859, and at the same time an agreement was executed by Thomson, reciting the deed, that Thomson had paid $21,030.75, and was to pay $3000 more, and it was stipulated that if Hanson and wife should pay Thomson the $24,030.75 on or before the 1st of May 1863, Thomson would convey the property to Mrs. Hanson if not previously sold with a proviso that if the payment and conveyance should be made before May 1st 1863, Thomson might retain the property until that time at a rent of $2000. The agreement wa-s dated October 10th 1859, “ being the same day and time when said indenture of May 31st 1865 was delivered to the said John Ev Thomson.”
    It was further averred that Thomson had been in possession of ■ the property since the date of the agreement. On the 20th of > May 1864, Mrs. Hanson had in writing demanded possession of the property on payment of the amount due, which she was ready to make, and asked from Thomson a statement of the account and had received no reply from him, &e.
    Thomson by his answer averred that the deed of May 31st 1858 was executed by Hanson and wife, in pursuance of an agreement for an absolute sale and conveyance of the property to him, in payment of Hanson’s indebtedness to him, and other money and property which he agreed to pay and transfer. He' had refused the deed when tendered because he was on his way to the railroad train on a journey, and had not time to examine it. He denied that the negotiation had failed; he had performed his part of it and was entitled to the delivery of the deed which was evaded and postponed by Hanson; further conditions were sought to be added with which he finally was compelled to comply.
    He admitted that the deed and agreement were delivered at the same time. He denied that there was any other plan of securing him, proposed; and averred that the conveyance was and was intended to be, a complete and absolute sale for a consideration greater than the value of the property. He denied any settlement of accounts with Hanson, or that it had been agreed to substitute a conveyance with a written defeasance for a mortgage; he averred that he had been entitled to a delivery of the deed since May 31st 1858, but had been constantly deceived by Hanson, who eventually proposed to deliver the deed, if Thomson would agree to reconvey the property at the cost at any time before May 1st 1863; he, Thomson, so agreed, if he should not have previously sold the property, and he himself, before signing the agreement, inserted in it the words “ if not previously sold,” intending not to limit his absolute ownership and power of disposing of the property.
    The whole case was referred to a master, who reported that there had been before him no evidence in relation to the deed and agreement except the papers themselves; that they formed one transaction and together were a mortgage to Thomson to secure money loaned by him, and that the devisees of Mrs. Hanson were entitled to a reconveyance of the property upon paying the amount due to Thomson.
    The agreement was as follows:—
    “ Agreement made and entered into by and between William R. Hanson of the one part, and John E. Thomson of the other part, both of Philadelphia.
    “ Whereas, William R. Hanson and Hannah A. his wife, by indenture dated the 31st day of May, A. D. 1858, granted and conveyed to the undersigned John E. Thomson, in fee, the messuage, &c., * * * subject to a mortgage of seven thousand five hundred dollars; in consideration whereof, the said John E. Thomson hath paid and given cash and other value to the amount of twenty-one thousand and thirty dollars and seventy-five cents, and hath agreed and doth agree to pay to D. S. Brown & Co., within twelve months from this date, three thousand dollars in compromise and settlement of a claim of said D. S. Brown & Co. against said William R. Hanson and his brother, the late Albert E. Hanson, provided the same can be effected.
    “ Now it is hereby agreed and understood by and between the said John -E. Thomson and William R. Hanson, that if the said William R. Hanson and wife, or either of them, their or either of their heirs, executors or administrators, will pay to Said John E. Thomson, his executors or administrators, the sum of twenty-four thousand and thirty dollars and seventy-five cents, on or before the 1st day of May 1863, if not previously sold; that then he, the said John E. Thomson, shall grant and convey said messuage ^and lot to said Hannah A. Hanson in fee, or to whomsoever she, in writing, may direct. Provided, however, that if said money be paid, and said messuage and lot be conveyed as aforesaid, before the said 1st day of May 1863, the said John E. Thomson may have and retain the use and occupancy of said messuage and lot until said 1st day of May 1863, as a tenant at or under a yearly rent of two thousand dollars, payable annually, to the said Hannah A. Hanson, her heirs or assigns, to be computed from and after the date of such reconveyance; which premises are to be given up to said Hannah Ann Hanson, her heirs or assigns, on said expiration of such tenancy as aforesaid, in like good order and condition as when received, reasonable wear and tear and casualties by fire only excepted. Witness our hands and seals this 10th day of October 1859, being the same day and time when the said indenture of May 31st 1858 was delivered to the said John E. Thomson.
    J. Edgar Thomson, [l. s.]
    Wm. R. Hanson, [l. s.]”
    On exceptions to the report the court at Nisi Prius (Read, J.) said: — “ I have carefully considered the master’s report in this case and the exceptions to it, and have duly weighed the arguments on both sides; and being of opinion that the positions of the master are correct, the exceptions are dismissed, the master’s report is confirmed,” &c.
    Thomson appealed to the court in banc, and assigned the decree of confirmation for error.
    The foregoing, with the opinion of the Supreme Court, will indicate the questions decided in this case.

      T. Cuyler, for appellant.
    The rule of law is, that two instruments of conveyance and defeasance executed and delivered at the'same time, are to be considered a mortgage where such is the intention of the parties: and in ascertaining the intention, ambiguities may be removed and explained by evidence of the circumstances under which they were executed: Coote on Mortgages 11; 5 Bacon’s Ab’t. 5; Lane v. Shears, 1 Wend. 433. If the parties intend an absolute sale, a contemporaneous agreement for repurchase will not require a redemption: Williams v. Owen, 10 Simon 386; Goodman v. Grierson, 2 Ball & Beatty 274. If there be evidence to rebut the presumption, an agreement to reconvey will not constitute a mortgage: Coote on Mortgages 22; Sabine
      v. Barrell, 1 Vernon 268; Perry v. Meddowcroft, 4 Beav. 197; Coote on Mortgages 15; 67 Law Lib. 54, and notes, especially a; Fisher on Mortgages 14; Davis v. Thomas, 1 Russ. & M. 506; Newcomb v. Bonham, 1 Vern. 8, 214, 232; Langton v. Horton, 5 Beav. 9.

      H. Longstreth, Henry Wharton and E. K. Price, for appellee.
    —A deed with a contemporaneous agreement to reconvey on the payment of a sum of money is as much in effect a mortgage as if the defeasance had been contained in the same instrument, and parol evidence is inadmissible to show that a conditional sale was intended; Colwell v. Woods, 3 Watts 188; Kerr v. Gilmore, 6 Id. 406; Kunkle v. Wolfersberger, Id. 126; Hiester v. Madeira, 3 W. & S. 388; Brown v. Nickle, 6 Barr 390; Reitenbaugh v. Ludwick, 7 Casey 138; Wilson v. Shoenberger, Id. 299; Houser v. Lamont, 5 P. F. Smith 316; Kellum v. Smith, 9 Casey 158; Harper’s Appeal, 14 P. F. Smith 315; Directors v. Royer, 7 Wright 146. The retention of securities is conclusive that the .transaction was a mortgage: Robinson v. Cropsey, 2 Edward Ch. 138; Rhines v. Baird, 5 Wright 264.
   The opinion of the court was delivered, February 12th 1872, by

Agnew, J.

This case is peculiar, having no exact counterpart in any found in our books. The master thought that the bill and answer neutralized each other, and being thus counterpoised, the case must be decided on the face of the deed and the so-called defeasance. Having arrived at this conclusion, he then pronounced the transaction to be a mortgage on the face *of the papers, as a security for advances by Mr. Thomson to Mrs. Hanson, with a power of sale on part of the former. The master says expressly, the only evidence before him touching the deed and agreement are the papers themselves. If this were the whole case, his conclusion would be justified by Colwell v. Woods, 3 Watts 188; Kerr v. Gilmore, 6 Id. 405, and other cited cases. In Brown v. Nickle, 6 Barr 390, this court, commenting bn Colwell v. Woods and Kerr v. Gilmore, remarked: “In the first of them it was determined that a conveyance and simultaneous covenant to reconvey on repayment of the purchase-money before a given day, must be construed to be a mortgage, though it appear by parol that the parties did not intend it to be so; and in the second, that it is not competent to the parties to prove by parol that the defeasance was a subsequent and independent agreement. These cases, said the court, are not to be resisted, yet we must suppose that there may be in some shape and under some circumstances, such a thing as a conditional sale. But the proof proposed in this instance was not of (distinctive acts which constitute it, but of the understanding of the parties. Their understanding, however, must be gathered from the writing, and if that be ambiguous on the face of it, it cannot be gathered from the parol proof.” The court also remarked that Kerr v. Gilmore “ pushed the doctrine to its utmost verge.” Now, if we turn to Kerr v. Gilmore, we find that the deed and defeasance were dated on the same day, and executed by the parties at the same time and before the same person's; and the offer was to prove that the deed was first executed, and then at the suggestion of one of the parties that ite would be a benefit to have the privilege of repurchasing, the agreement was put in writing and executed after the deed had been executed, and the parties then spoke of it as a sale. Such is the nature of the evidence held in Kerr v. Gilmore to be incompetent, and it is clear its true character was an attempt to prove the mere understanding of the parties against the legal character of the papers as it appeared on their face. Hence it was said by Justice Huston in the opinion, “ that it has become impossible to draw any conveyance, nay, to make any contract by which property shall be redeemable for a certain period, and cease to be so after that period has elapsed.” Yet in the same opinion we find qualifications which evidence the extent of the decision. In connection with his statement that two instruments — a deed and a defeasance of the same date — are necessarily a mortgage, he also says that all the cases show that all the circumstances of the whole transaction are inquired into in chancery and in our own courts.” In another part of the opinion he qualifies what he had said in these words: “ If a case can occur where such conveyance and defeasance do not constitute a mortgage, it must be one in which some time has elapsed, some circumstance has occurred, to satisfy the court and jury that the contracts were wholly separate; that the first was always intended as a real, actual sale, and the second bargain a real distinct agreement to purchase again property which had' once been actually sold; but the two bargains cannot be made in the same hour and day, nor evidenced by instruments executed as these were before the parties separated, and before the witnesses to the first instrument left the room, or any new information had been communicated.” That a case can arise wherein the first instrument can be shown to be a real sale, and the second, an unconnected resale, is proved by Spering’s Appeal, 10 P. F. Smith 199, where the first instrument was an actual sale under a power contained in a former pledge of stock, for the very purpose of conversion to redeem the pledge, and the second was an independent agreement to resell the same kind of stock, in order to give the former owner the rise of the market for a stipulated time. Reitenbaugh v. Ludwig, 7 Casey 132, shows also that even in a common-law action evidence will be received to prove the true nature of the transaction, when the deed and alleged defeasance are dated apart from each other. There Woodward, J., submitted the question of a sale or a security to the jury, and the judgment was affirmed. Harper’s Appeal, 14 P. É. Smith 315, relied on by the appellee as ruling the case before us, is another proof of the practice to hear the circumstances of the whole transaction where the deed and defeasance are not simultaneous in date. In all the cases it will be seen that the distinctive acts, as they are called in Brown v. Nickle, which characterize the transaction, have been treated as the proper subjects of evidence, and not the mere understanding of the parties, or their belief as to the legal effect of their acts; and in all, the sum of the matter has been to determine by the true nature of the transaction, whether the conveyance was an actual sale, or a mode of securing money lent, or a debt. The only exception is, where the instruments are of even date on their face, and where, being in terms a conveyance and a contract to reconvey on payment of the money passing between them, they are in legal contemplation a mortgage. In that case, being a mortgage on their face, parol evidence will not be received to convert them into a conditional sale.

With these principles in mind, let us examine the facts before us. In doing this it will* be found that the error of the master was in treating the bill and answer as completely neutralizing each other, and (disregarding all other evidence) in deciding upon the deed and agreement as instruments of even date and creation (witnessing one and the same transaction on the same day) and thus falling within the principle of Colwell v. Woods, Kerr v. Gilmore, and some other cases. But the first paragraph of the plaintiff’s bill sets forth a strong, and in some respects, controlling fact admitted by the answer to be true; that there was an agreement for the sale of the property to the defendant, upon which the very deed in question was executed and dated May 31st 1858, and shortly afterward tendered to the defendant. The only difference between the bill and answer upon this point is, that the former alleges that Mr. Thomson refused to accept it, because the price of the property was too high, while the latter asserts that the tender was made to him when going to the cars on a journey westward, followed by a protracted absence; and that the refusal was only because the time and place afforded no fitting opportunity for its examination. That the deed was originally made and tendered on the footing of an actual sale, is undeniable. Now when we refer to the two instruments themselves, we find them dated widely apart — the deed on the 31st of May 1858, and the agreement on the 10th of October 1859. On the face of the deed there is nothing in date, recital or other circumstance to connect it with a transaction a year and five months later, and it is only in the agreement of October 10th 1859, at the foot we find a recital that the deed of May 1858 was delivered on the same day with the agreement. In the absence of controlling facts, this recital would establish their operation as a mortgage. The recital of simultaneous delivery is, however, an admission of. that fact only, and does not account for the widely discrepant dates and executions of the papers. This necessarily brings in the evidence to account for a fact on the face of the instruments themselves totally' at variance with the idea of their execution as contemporaneous parts of one transaction. This evidence is furnished by the admissions of the parties themselves, corroborated by the date of the deed, that it was executed upon a sale, and not as security for money, and that this is the same deed which was finally delivered. Now, if a deed of long antecedent date, founded upon an acknowledged sale, is to be made to play a new part at a much later day, and to take upon itself the form of a defeasible conveyance as a security for money lent or advanced, assuredly the burthen of proof falls upon the party averring the change in its character. On this question the bill and answer stand in direct contradiction to each other all the way through, the bill averring that the sale became a mortgage, and the answer expressly denying every fact and allegation set forth in the bill, to this effect. JS[p attempt has been made to disprove the answer in these material and positive denials, either by two witnesses or by one witness and circumstances equivalent to the testimony of a second, but the case is rested by the plaintiff wholly on the agreement itself of October 10th 1859. Yet this paper is not in form a defeasance, but an agreement to sell, and on its face bears evidence tending to deprive it of the character of a defeasance. In the first place, the consideration expressed in it is not the same as that set forth in the deed, but a greater one — that in the deed being $22,500, and that in the agreement, $24,030.75. This is not a strong circumstance, but it shows discrepancy, rendering it somewhat probable that the resale was for a greater sum than the sale. There is another fact of more weight. The agreement binds Mr. Thompson to convey to Mrs. Hanson only if the premises be not previously sold. Thompson, it seems, interlined the words “ if not previously sold,” as he says, to protect himself in his purchase. The interlineation is conceded to be his. The plaintiff contends that this expresses only a power, and that the instrument was a defeasance with a power of sale to the mortgagee. But this begs the question. If we assume that the deed is a mortgage, the words in the defeasance, of course, import only a power of sale. But on the primary question whether it was a sale or a mortgage, the words interlined in connection with the date of the deed, and the actual prior sale, strongly indicate a sale and an intention to prevent a question as to Thomson’s right to sell whenever and to whom he pleased. It, therefore, discloses Thomson’s intent to take the deed as it was originally intended, as a purchase; and to preserve his own control over the property. Having reached the point that these instruments, together with the admitted facts, tend to repel the allegation that the deed admittedly made upon a sale, was afterwards changed into a mortgage; we are now at liberty to consider certain other facts and circumstances corroborating the answer of Mr. Thomson, and strengthening the denial of the change into a mortgage. Hanson, the husband, is admitted to have been largely indebted to Mr. Thomson, and unable to pay his debts. In this situation the bill admits that his wife came forward to aid him by the sale of the house and lot in question. The property was not worth more than the price stipulated in the deed, to wit — $22,500— subject to a mortgage of $7500, making $30,000. The evidence of value taken would make it less valuable; but leaving that out of sight, and taking the purchase itself as Mr. Thomson’s admission of value at that time, and the assertion of the bill that he afterwards declined to take the property as being too high, it is very evident the price fixed in the deed was the full value of the property. In connection with this fact, which in itself repels the idea of a mere security for money, is the entire absence of any evidence of an obligation to pay the debt. No covenant was taken in the agreement; no bond or any other security for the repayment of the money. And to these circumstances we must add the money advanced by Thomson .to improve the property, which would.,be unsecured by the property if it was returned to Mrs. Hanson as a mere mortgage. But if it were a sale, Thomson, having reserved his right to sell, could sell, repay his outlay, and render to Mrs. Hanson the sum stated in the agreement. All these indicative facts seem to be utterly irreconcilable with the fact of a mortgage, especially when we consider one of the grantors in the deed was a married woman, and the other an insolvent man. Upon the whole case we are forced to the conclusion that the deed was not a mortgage, and the subsequent agreement was a new resale brought about by the delays and difficulties arising between the parties, and forced upon Mr. Thomson in order to close the sale, and also out of regard to the relation of Mrs. Hanson as a wife, and the owner of the property, coming to her husband’s assist-» anee, to enable her to regain it if she could pay for it.

The decree of the Court of Nisi Prius is therefore reversed, and it is now adjudged and decreed that the said deed of May 31st 1858 is a grant of the premises by way of a sale, and not a mortgage; and it is further decreed that the bill of the plaintiff be dismissed, with costs to be paid by the appellee.


source: Caselaw Access Project

author: Thompson, C. J.

license: Public Domain

text:
    Wanamaker versus Yerkes.
    1. S., a debtor of Y., gave him an order for goods on W., who owed S. nothing. S. failed; afterwards Y. not knowing the failure, presented the order at W.’s store, received part of the goods; the remainder was made up in packages and promised to be sent to Y.’s house, who receipted for them to W. W. having learned of S.’s failure could retain the goods for his lien on them for the price.
    2. There was not such delivery as vested title in Y.; there was but an agreement to deliver.
    3. That there was a written order or that Y. was ignorant of the insolvency of S. was immaterial.
    4. White v. Welsh, 2 Wright 396, recognised.
    January 29th and 30th 1872.
    Before THOMPSON, C. J., Agnew and Sharswood, JJ. Williams, J., at Nisi Prius.
    Error to the District Court of Philadelphia: No. 222, to January Term 1871.
    On the 1st of May 1869, an action of assumpsit between Harman Yerkes, plaintiff, and John Wanamaker, defendant, was commenced in the District Court of Philadelphia.
    The declaration was that the defendant was indebted to the plaintiff “for ready-made clothing, being the property of the said plaintiff, which the defendant detained and withheld from the plaintiff, and being so indebted,” &e., promised to pay, &c.
    The plaintiff’s testimony was that on the 17th of November 1868, he presented to a clerk of the defendant at his clothing store this order:—
    “ Philadelphia, October 29th ’68. Messrs. Wanamaker & Brown,
    Gents: — You will please let Mr. H. Yerkes or bearer have such clothing as they may select, with bill, and charge to my ac.
    & oblige, Ales. Sloan.”
    He selected $174 worth of clothing and then got $66 worth more ; he took away an overcoat and pantaloons at the time. The other goods were separated from s W.’ stock ; they were put into five or six packages; the plaintiff ordered them to be sent to the corner of Sixteenth and Ellsworth streets, “ they said they would send them there.”
    At the same time W.’s clerk endorsed these receipts on the order and the plaintiff signed them :—
    “ Ree’d, on ac. of this order, clothing to amt. of one hundred and-seventy-four dollars.
    $174.00.”
    “ Rec’d, on ac. of this order, clothing to amt. of sixty-six dollars.
    $66.00.”

      At the time the order was drawn and presented, Sloan owed the plaintiff a larger amount than the value of all the goods.
    The plaintiff gave in evidence also the following:—
    “ Oak Hall, 11th Mo. 17th 1868.
    “Harman Yerkes, Esq.,
    “ Dear Sir: — We regret to say that we cannot deliver the goods you purchased to-day on Mr. Sloan’s order. Circumstances that have developed themselves since last night have compelled us to decline this order, and we would like to see you before anything else is done in the matter.
    “Yours truly, Wanamaker & Brown.”
    The goods, except the overcoat and pantaloons, were not delivered to Yerkes.
    The defendant’s evidence was that at the time the order was presented, neither the defendant nor his chief clerk was in the store; the order was received by a salesman ; before the packages were put into the delivering wagon, the chief clerk came in and directed them not to be delivered in consequence of having received notice for a meeting on November 16th of the creditors of Sloan, who had previously failed.
    Sloan testified that a few days before the date of the order the plaintiff asked him for an order on defendant for $25 or $80 worth of clothing, but wished the order left open; the agreement between witness and plaintiff was that he was to get not more than $25 or $30 worth of clothing; witness afterwards gave defendant notice not to deliver the clothing; the defendant received from Sloan no consideration for the order.
    The plaintiff ^testified that he never had notice of Sloan’s failure.
    The defendant submitted a number of points, the first of which was:—
    “ If the jury believe from the evidence that the order dated October 29th 1868, was given to plaintiff by Alexander Sloan on account of a prior indebtedness to plaintiff, and without any other consideration, and that it was not presented at defendant’s store till the 17 th day of November, and that in the meanwhile said Sloan had failed, and that defendant’s clerk without knowledge of the failure and without consulting defendant, agreed to furnish clothing on said order, and that plaintiff selected clothing therein which was set apart for delivery to plaintiff, and that defendant was never paid for the goods so set apart, the defendant had a right to refuse to deliver the same on learning of the insolvency of said Sloan, and no property in the goods vested in the plaintiff.”
    The court answered:—

      “I cannot affirm this point unless the plaintiff knew of the failure of Sloan, and I see no evidence to show that he did know of it. He himself denies that he knew it, and there is not, so far as I know, any evidence to show that he did know of it.”
    The verdict was for the plaintiff for $221.27.
    The defendant took a writ of error, and assigned for error (amongst others), the answer to his first point.
    G. C. Purvis and J. B. Gest, for plaintiff in error.

      A. Briggs, for defendant in error.
   The opinion of the court was delivered, March 11th 1872, by

Thompson, C. J.

The doctrine applicable to this case is no new doctrine, and needs no elaborate discussion. The plaintiff brought to the defendant an order for goods (clothing) drawn on him by one Alexander Sloan. It was dated the 29th of October 1868, but was not presented until the 17th November. On the morning of that day the order was accepted by a clerk in the defendant’s store, and such clothing was selected and put into bundles as the plaintiff desired to take on the order, with the exception of some he wore away with him; the rest he left with directions where they were to be sent by defendants, which they promised to do. It so happened on the day prior Sloan failed, and this was communicated to the defendants before delivery of the goods. The goods still remaining in the custody of defendant, he retained them on his lien for |the price, as no money had been paid for them by Sloan, on whose credit they had been selected for delivery to the plaintiff. There was no such delivery to the plaintiff as vested title and possession in him. There was an agreement to deliver; nothing more. The delivery had not even commenced. It was a case, therefore, in which without doubt the plaintiff could retain the goods, or he could have stopped them in transitu. It is exactly within the case of White et al. v. Welsh et al., 2 Wright 896, which was carefully considered by this court, and is supported by innumerable authorities. The learned judge erred, therefore, in his answer to the defendant’s 1st point. He should have affirmed it. We see no reason in refusing it on the ground that the plaintiff did not know of Sloan’s insolvency. It was not the case of a purchase of goods to be paid for by the note of a third person. The order did not vary the transaction in the least from a verbal order to the same effect given by Sloan in favor of the plaintiff. Sloan was the purchaser on credit from Wanamaker, and his failure entitled the latter to retain the goods upon his lien for the price.

There are no other points of any consequence in the case, and as this ruling cuts up by the roots the plaintiff’s case, we reverse, without an order for a venire de novo.

J udgment • reversed.


author: Sharswood, J.

text:
    Cresson et al. versus Ferree.
    1. A testator gave equal shares of his estate to distinct trustees for the separate use of each of his daughters for life, and after the death of a daughter to go according to the intestate laws; the “ trustees” to have power when they thought advisable, to sell and convey his real estate and invest the proceeds for the uses before provided ; two trustees were appointed by the Orphans’ Court in place of one declining; two daughters died intestate, unmarried and without issue. Held, that the trustees under the will and those appointed had. power to sell the land so long as any of the trusts continued.
    2. The power of the trustees to sell was not limited to the particular share of which each was trustee, but extended to the whole land devised in trust.
    3. The power being beneficial was to be liberally construed.
    4. The power was limited to the continuance of the trusts, although some of the trusts had ceased, and was therefore not obnoxious to the rule against perpetuities.
    5. Act of April 22d 1846, 11, gives the same power to trustees substituted by the Orphans’ Court as the original trustees had.
    January 31st 1872.
    Before Thompson, C. J., Agnew and Sharswood, JJ. Williams, J., at Nisi Prius.
    Certificate from Nisi Prius, No. 229, to January Term 1871.
    This was an amicable action between John C. Cresson, Adam Everly, George M. Troutman and Albert S. Letchworth, trustees under the will of Adam Everly, deceased, plaintiffs, and James B. Ferree, defendant. A case was stated for the opinion of the court, showing the following facts:—
    Adam Everly died in February 1865, owning certain real estate, described in an exhibit marked A, attached to the case; and having made his will and a number of codicils by which, after providing for his wife and for his son Samuel, and making other dispositions for certain of his children, he gave the residue of his estate in eighth parts, seven'to distinct trustees for the separate use of each of seven daughters — Catharine and Mary being two ; the remaining eighth part he gave to his son William A. Everly absolutely.
    The bequests to the daughters were similar; Catharine’s is as follows:—
    “ One other full equal eighth part or share thereof Ugive, &c., unto the said John C. Cresson, his heirs, &c., to hold the same and every part and parcel thereof, with the appurtenances, unto the said John C. Cresson, his heirs, &c., in trust, * * * to let, lease and demise the real estate, and put and keep out at interest on some good and safe investment the personal estate forming such part or share, and collect in and receive the rents, interest and income thereof, &c., * * * and to pay the same over from time to time, when and as the same shall be got in and received, unto my daughter Catharine Everly, for her sole and separate use for and during all the term of her natural life, yet so that the said rents, &c., * * shall not be under the control of any husband whom she may hereafter have or take, or in anywise subject to or liable for any of his contracts, debts or engagements; and from and immediately after the death of her, my said daughter Catharine, then in trust, &c., * * to and for the only proper use and behoof of all and every the child or children which she, my said daughter Catharine, may have or leave, and the lawful issue of any of them who may then be deceased, having left such issue, their several and respective heirs, executors, administrators and assigns for ever, such issue of any deceased child or children of her, my said daughter Catharine, taking, however, and only receiving such part or share thereof as his, her or their deceased parent or parents would have had and taken had he, she or they been then living. And in the event of the death of her, my said daughter Catharine, without leaving any child or children or lawful issue, and without leaving any lawful issue of any deceased child or children, then in trust as regards the whole of the said share of my residuary estate, to and for the only proper use and behoof of the right heir or heirs of her, the said Catharine, according to the then existing laws of the Commonwealth of Pennsylvania, their several and respective heirs, executors, administrators and assigns for ever.” * * *
    He further provided : “I do hereby authorize and empower the above-named trustees or their heirs and assigns, in case they shall deem it advisable and conceive it to be for the benefit of my estate-to do so, to sell or dispose of all or any part of my said residuary estate (excepting always the premises in West Philadelphia called ‘ Emlenton,’ hereinafter mentioned), and by the proper deed or deeds, conveyances or other assurances in the law, to grant and convey the same to the purchaser or purchasers thereof in fee, and the moneys arising from such sale or sales again to invest in their discretion, in trust for the several uses hereinabove set forth and declared of and concerning my said residuary estate.
    “I do hereby expressly order and direct that no sale, partition or alienation whatever shall be made of my said estate in West Philadelphia called ‘ Emlenton,’ or of any part thereof, for at least a period of ten or fifteen years after the decease of my wife.”
    Morris Patterson, a trustee named in the will for two of the daughters, having declined to accept the trust, the Orphans’ Court appointed George M. Troutman for one, and Albert S. Letchworth for the other.
    Catharine died in the life of the testator, unmarried and without issue; Mary died since his death, intestate, unmarried and without issue; Samuel died after Mary, leaving a widow and several children, and having made a will, by which he disposed of his interest in Catharine’s share; but made no disposition of his interest in Mary’s share.
    The trustees, acting under the power in the will, on the 5th of October 1869, sold the land described in exhibit A at public auction to the defendant for $15,700. He declined to pay the purchase-money and take a deed, on the ground that the plaintiffs could not by their own deed as such trustees convey to him a good and sufficient title thereto in fee simple, discharged of all trusts and limitations created by the will of said testator.
    By the case the parties “submit to the court the question whether the plaintiffs under the provisions and powers contained in said will, and by virtue thereof and the substitutions so made as aforesaid, have power and can convey a good and sufficient title in fee simple to the said defendant to the aforesaid lot of ground freed from any trusts or limitations contained in said will, in respect to the testator’s residuary estate, and if the court shall be of opinion that they can so convey the same, then judgment to be entered in favor of the plaintiffs for $15,700 with interest from the date hereof, recoverable on the execution and delivery or filing in court of a deed of conveyance to be approved by the court, and if the court shall be of opinion that the plaintiffs cannot by their own deed convey such title as aforesaid, then the judgment to be entered for the defendant, and the costs to follow the judgment.”
    The court at Nisi Prius entered judgment for the defendant. The plaintiff had the record certified to the court in banc, and assigned the entering of judgment in favor of the defendant for error.

      J. B. Townsend and W. M. Tilghman, for plaintiffs in error,
    as to the power of the trustees to sell, referred to Sugden on Powers 43. They should be favored: Boyce v. Hanning, 2 Crompton & Jervis 334; Coates v. Hughes, 3 Binney 498 ; Edwards’s Appeal, 11 Wright 144; McKnight v. Read, 1 Wharton 213; Walker v. Hall, 10 Casey 483; Young’s Appeal, 3 Wright 118. The substituted trustees have the same powers as the original trustees: Acts of March 17th 1838, sect. 2, Pamph. L. 81; April 10th 1849, sect. 2, Pamph. L. 597; April 13th 1859, sect. 1, Pamph. L. 611, 2 Bright. Purd. 1422,1423, pi. 52, 56, 55. After the death of one of the cestuis que trust, the power still remains in the trustee: Tower v. Knightley, Maddock 91; 2 Sugden on Powers 509.

      H. Wharton, for defendant in error.
   The opinion of the court was delivered, February 5th 1872, by

Sharswood, J.

That the testator Adam Everly intended to invest the trustees named in his will with a general power of sale over his residuary estate, is altogether incontrovertible. This appears not only by his express language, but by the exception of that part called Emlenton, for at least a period of ten or fifteen years after the decease of his wife. It’ was evidently not merely a power in the trustees over their respective estates, in the land, but a collateral naked power over the whole land itself. The object of the power was manifest — that the land otherwise unproductive might, whenever suitable, be brought into the market, and made available for the purposes of the will. It was beneficial, and therefore to be liberally construed, because while testators are thereby enabled to subserve the true interests of their children by limiting to them only life estates, the growth and improvement of the city are not obstructed.

Was this a valid power of sale originally, or has anything occurred since which renders its present exercise invalid ? The donees of the power are perfectly certain — and the subject-matter over which it is to be exercised. So is the time within which it is limited. We may concede that a general power over an estate without limitation of time — unless after an estate tail — would violate the rule against the creation of perpetuities. In this case, however, the power of sale is clearly limited to the period during which the trusts created by the will subsist, or some of them; and that cannot exceed a life or lives in being at the death of the testator. Upon the death of the daughters the trusts respectively cease, and the shares discharged of the trusts become executed in their children, who will thereupon be entitled to a conveyance from the trustees. This very point was considered and decided by the Master of the Bolls, Sir John Bomilly, in Tait v. Swinstead, 26 Beav. 525, where an estate was devised to trustees for different persons in fifth shares, some of which shares’ were given to living persons absolutely, and the others to living persons for life with remainder to their children in fee, and an unlimited power of sale over the whole estate was given to the trustees : it was held that this power of sale was valid, and could be exercised over the whole estate, so long as any of the trusts of any of the shares remained to be performed.

Nor has anything since occurred to render the exercise of the power invalid. The trustees appointed by the Orphans’ Court in the place of Morris Patterson, who declined to accept the office, are clearly invested with all this power. “ In all eases where any trustee or trustees created or vested with authority by the last will and testament of any deceased person, or any writing testamentary in the nature of a will, shall die, resign or be otherwise removed from the trust, the Orphans’ Court of the proper county shall have power and authority to appoint another trustee or trustees, to supply the vacancy occasioned by such death, resignation or removalAct of April 22d 1846, § 1, Pamph. L. 483. What has already been observed evinces that the power is not affected by the fact that some of the trusts have ceased, because it is entirely collateral to the respective estates of the trustees.

Judgment reversed, and now judgment for the plaintiffs for the sum of $15,700, with interest from December 16th 1870, recoverable on the execution and delivery or filing in court of a deed of conveyance of the property described in exhibit A annexed to the case stated.


text:
    Cunningham et al. versus Smith’s Adm’r.
    1. When a fact essential to the plaintiff’s case is admitted by the pleading, it is not proper to admit evidence to prove it, if the evidence contains other matter irrevelant which may be calculated to distract and mislead the jury.
    2. Letters of administration are primfi, facie evidence of the death of the person on whose estate they are granted, and where there is no issue made upon them, are conclusive evidence of the fact of death.
    3. One has a right to have his life insured with the money of another and assign the policy to him absolutely.
    4. A policy of insurance was issued to S. on his life, the premiums being paid by 0., to whom S. immediately made an absolute assignment of the policy. The evidence in the case insufficient to submit to the jury that the assignment was as collateral.
    5. A case cannot be submitted to the jury on a scintilla of evidence.
    6. Howard Express Oo. v. Wile, 14 P. F. Smith 201, adopted.
    January 31st and February 1st 1872.
    Before Thompson, C. J., Agnew and Sharswood, JJ. Williams, J., at Nisi Prius.
    Error to the District Court of Philadelphia: No. 231, to January Term 1871.
    This was an action of assumpsit brought March 31st 1869, by Anne Smith, administratrix, &c., of Jerome Smith, deceased, against Winthrop Cunningham, William T. Cunningham and Graham P. Cunningham, trading as W. Cunningham & Sons.
    Jerome Smith having been in his lifetime connected in business with the defendants, effected an insurance on his life with the 'Connecticut Life Insurance Company for $5000 and assigned the policy No. 88,435 to the defendants; after his death they collected the amount of the insurance. The suit was brought by the plaintiff to recover what had been received by the defendants on the policy.
    The question was whether the assignment of the policy to the ■defendants was absolute or as collateral security.
    The case was tried before Thayer, J., October 31st 1870.
    The plaintiff gave in evidence, her letters of administration on the estate of Jerome Smith, deceased, granted March 15th 1869, also articles of agreement dated September 1st 1868 between the plaintiff of the first part and W. A. McCann and Jerome Smith, trading as W. A. McCann & Co., of the second part, reciting that the parties of the second part were about to establish themselves in business in Vera Cruz, &c., and agreeing that the two parties should purchase and consign goods to each other from the United States, and Mexico and Central America respectively, and divide the profits; — the party of the first part to furnish the other party with cash and letters of credit, &c. Also policy of insurance No. 88,435, dated September 19th 1868, issued by the Connecticut Life Insurance Company to Jerome Smith for insurance on his life for $5000, endorsed thereon, assignment by Jerome Smith as follows:—
    “ Philadelphia, September 19th 1868.
    For value received, the receipt of which is acknowledged, I hereby assign, transfer and set over absolutely unto W. Cunningham & Sons and assigns, policy No. 88,435, to which this is annexed, issued on my life by the Connecticut Mutual Life Insurance Company of Hartford, Connecticut, and any money which may at any time hereafter come to be payable by reason thereof, and all and singular the remedies in law, equity or otherwise for the recovery thereof.”
    Also endorsed, receipt March 13th 1869 by defendants for $5000, less $1.42 premium.
    Also, policy of insurance from same company, dated September 12th 1868, countersigned by W. H. Tilden, agent, September 19th 1868, on life of Jerome Smith for $5000, payable to Mrs. Annie Smith with receipt, Annie W. Smith, dated March 13th 1869, endorsed thereon for $5000, less $1.50 premium due.
    Also receipt of J. B. Gest, defendants’ attorney, viz.:
    “Received March 5th 1869, of Mrs. Jerome Smith, her draft upon the Connecticut Mutual Life Insurance Company of Hartford, Connecticut, per Walter H. Tilden, Esq., its agent in Philadelphia, of this date, to our order for $523.75, payable upon settlement of the policy of insurance on the life of her late husband, standing in her name, such amount when paid to be in full receipt and acquittance of premium paid by us September 17th 1868, on said policy, viz.: $113.75, and also $410 advanced by us to her, as follows,” &c. (stating specific payments).
    Mrs. Smith, the plaintiff, who was the widow of the decedent, testified that her husband sailed from Philadelphia for Havana, September 17th 1868; on the 10th of October, W. T. Cunningham called on her, and asked her for the policy which the decedent had taken out; he said he had received a letter from Gonzales Poey at Havana, informing him of the decedent’s death, on the 2d, of yellow fever; she said that at an interview shortly afterwards “ he told me that the policy they had taken out to secure them against losses was lost, but that mine were all right. * * * He said they had lost their policy, and they did not know what they could do. They had failed, he said, to pay the premium when they were called upon, or something to that effect. He said he intended to publish the company in every state in the Union, because they had failed to pay the money.”
    H. W. Smith, a son of the plaintiff and stepson of decedent, testified as to his mother’s first interview with Cunningham substantially as she did; he also testified: * * * “She wanted to go on; he told her she could not go; that she had plenty of money to live on, and they would not see her want for anything; he left some money for mother at that time; he laid it on the table; I don’t know how much; on the following Sunday I saw him there again; he then told mother that the policy they had taken out was lost on account of non-payment of the premium, but that mother’s policies were all right; they had neglected to send the check for the premium around; he said that they had lost the policy that they expected would cover all the expenses, because they had neglected to send a check to Mr. Tilden; mother said she would have the body brought on at any expense; I went into the employ of the defendants November 9th; while in their employ I asked several times for the policies, at my mother’s instance; I never got them, and they always gave excuses — said that Mr. Gest had them, and they forgot to get them ; * * * Cunningham said mother’s policies were all right, but the one taken out to secure them was lost.”
    The plaintiff offered in evidence the deposition of Gonzales Poey, also a letter from witness to defendants, dated October 2d, and letter from defendants to witness, dated October 5th 1868, both referred to in deposition.
    The defendants objected to the offers; they were admitted and several bills of exception sealed.
    The witness Poey, proved the death of Smith at Havana of yellow fever on the 2d of October, and that he telegraphed to the defendants on the 3d of October, in the morning; he wrote to defendants by steamer on the 3d; he also informed Mr. Neilson, of Havana, of Smith’s death, and saw his effects sealed up by the American consul at Havana; the body was embalmed by the consul and witness, under directions, by telegraph, from the defendants.
    The letter from witness to defendants informed them of Smith’s death ; that his effects were in the hands of the American consul; that he had $760.55 in money; that the consul would pay all expenses, &c. The letter from defendant to witness acknowledged the receipt of the telegram from witness, stating it was paid ; saying they had sent a telegram directing the embalming of the body; that the money was defendants’; directed witness to save expenses. In the letter the defendants said they could not get permission from the health officer to land the body, and had ordered Mr. Neilson to bury the body without embalming ; that in consequence of the destitute condition of the family of the deceased, they “ were anxious to cover all possible expenses, and thereby assist them as much as we can; we want all expenses saved that can be on account of the wife and family.”
    The plaintiff gave in evidence an account presented by the defendants to her for advances to the decedent, premium on life-policy, postage, half expenses of returning body, &c., amounting in all to $1431.39.
    Winthrop R. Cunningham testified that he was present at several interviews between Smith and the defendants at their office, shortly before Smith started for Vera Cruz. “William T. Cunningham suggested to him, and to the firm, that his life should be insured. This was agreed upon, and Smith expressed himself willing it should be done to any amount for the benefit of W. Cunningham & Sons. I am now speaking of several conversations. I do know that in the course of one conversation W. T. Cunningham said distinctly to Jerome Smith that he wanted it clearly understood that on any insurance that he effected for the firm, that if he died, we made the insurance, if he didn’t we lost the premium. I remember those words; Jerome Smith fully assented to this. And William T. Cunningham further suggested that he should insure his life for the benefit of his wife and family; Jerome Smith replied that he had no money. William T. Cunningham (that is the firm) offered to furnish the money, and did so. Jerome Smith left to go to the office of Walter H. Tilden, the agent of the Connecticut Mutual Life Insurance Company, to make application and he examined. I know the policies were issued, and I saw the assignment. I saw the policies and both the assignments — one was to W. Cunningham & Sons, and the other assignment was to Mrs. Annie Smith, wife of Jerome Smith. I know that W. Cunningham & Sons paid the premiums on both policies. When the subject of insurance was introduced Jerome Smith mentioned the Continental Insurance Company, but that company was strange to W. Cunningham & Sons, who had their insurances largely in the Connecticut Mutual, and they recommended that company. The firm agreed to place $5000 on his life for the benefit of his wife. The amount of W. Cunningham & Sons’ policy was left entirely to them, Jerome Smith signing the assignment to them in blank as to the amount of the policy; they were to decide as to the amount at their convenience ; the question was whether it was to be five, or ten, or fifteen thousand dollars. * * * It was intended to guard against any possible loss in case of his death, although it was clearly looked upon and intended as an investment. * * *

      “It was clearly understood and agreed upon between Mr. Smith and W. Cunningham & Sons that it was to be solely for the benefit of W. Cunningham & Sons, free from any claim of any kind. Mr. Smith was asked if he was willing that his life should be so insured, and he expressed himself as being perfectly willing without reserve. I know from what I heard, that irrespective of this policy Mr. Smith was to refund to W. Cunningham & Sons any private advances, and the money furnished him was to be invested in merchandise for benefit of McCann & Smith and W. Cunningham & Sons.”
    Gr. P. Morgan, a book-keeper of defendants’, testified “ that a few days before Smith sailed, Smith in answer to the inquiry by W. Cunningham, whether he had made provision for his family, said he had, in the Continental Insurance Company; William Cunningham asked him if that was all he would like to have; he said he would like to have more but couldn’t afford it; William Cunningham said if he wanted more the firm would advance money to pay the premium; he seemed thankful; an application was made to the Connecticut Company and a policy was taken out for his wife; there was then a further conversation about a policy to be taken out for the benefit of the firm, and as to whether there would be any difficulty in their taking out a policy which would secure them the amount of it in case of his death, whether they had any interest or not; Mr. Smith said they could take out a policy for whatever amount they liked, if they would pay the premium ; he then went to the Connecticut Mutual Insurance Company’s office and signed an application in blank, and also an assignment; he told me he had done so; Mr. W. Cunningham said it was understood that they were to recover the money whether Smith was indebted to them or not, that it was an investment on their part; * * * it was understood that this policy had nothing to do with their advances to Mr. Smith, or to the business in Mexico ; I .heard Mr. Cunningham say this to Mr. Smith. The policy had nothing to do with the advances to Jerome Smith, or the risks of the business in Mexico; it was as I said an investment on Mr. Smith’s life; there was no business risks spoken of; it was outside of all these matters; these checks were filled up by me, and were given for premiums on the two policies in the Connecticut Mutual.”
    Walter H. Tilden testified: “As agent for the Connecticut Mutual Life Insurance Company I issued these policies. * * * I witnessed the assignment of this policy to defendants. Jerome Smith said it was to be an absolute and unconditional assignment, and it was so drawn by me; it was not recorded; the assignment specifies no amount. The policy was made out on its date, September 19th 1868. Our policies are not valid until countersigned by me as the local agent. I countersign them when delivered. These policies were countersigned the same day. The last policy was received about a week afterwards. They were dated even, so as to secure the assignment. The assignment was in blank, only to be issued in ease the policy was issued. It was signed September 15th 1868, at the time he made the application.”
    There was. some contrariety of evidence whether the premiums had been paid by defendants to the insurance company before or after the death of Smith.
    The plaintiff’s 5th point which was affirmed was:

      “ If the jury find from the evidence that the policy in question was assigned to defendants to secure them from loss for moneys by them advanced or to be advanced to Jerome Smith or McCann & Co., or from loss on business done with said firm, then the plaintiff is entitled to recover from defendants the amount received from the insurance company less such moneys so advanced and such losses; and that the defendants must show the amounts of such advances or losses.”
    The defendants submitted these points:—
    1. The assignment of the policy by Jerome Smith in his lifetime to the defendants, vested in the defendants a right to the money to be paid at his death by reason of the policy, and the verdict should be for the defendants.
    2. If the jury believe from the evidence that the assignment of the policy of insurance by Jerome Smith to the defendants was not made in fraud of creditors, the verdict should be for the defendants.
    3. If the jury believe from the evidence that the defendants with their own moneys paid the premium for the policy, then they are entitled to the benefit of the same, and the verdict should be for the defendants.
    6. A merely voluntary assignment by a party, of a policy of insurance on his own life, is good against his executors or administrators, and if the jury find from the evidence that Jerome Smith did assign the policy in question, the verdict must be for ,he defendants.
    9. Whether the payment of the premium by defendants to the insurance company was after or before the death of Jerome Smith, is not material, except as between the company and the defendants ; and if the company, notwithstanding, paid the amount insured to the defendants, the fact, if it be so, that the premium was not previously paid, cannot enure to the benefit of the plaintiff.
    10. On all the evidence in the case, the verdict of the jury should be for the defendants.
    In answer to the points the court said:—
    “ As to the 9th point, I decline to say that it is a totally immaterial circumstance in the consideration of the case, though it does not appear to me to be very material, but I leave it with all the facts to you. I will say, however, that in point of law it is not material whether the premium was paid before or after the death.
    “ The other points of the defendants I decline to- instruct you as requested.’’
    The court also charged :—
    “ If the jury should find that the assignment of September 19th 1868, although on its face an absolute assignment, was in truth and in fact, and by the agreement and understanding of the parties intended to be only an assignment intended to secure the defendants their advance and expenses, or to secure other claims which they might have against William A. McCann & Co.; in other words, that they were only to acquire a limited interest in the policy instead of the absolute ownership, then the defendants, out of the amount which they collected from the company on the policy, can retain only such sum as represents, and is equal to their advances or expenses or other just claims against William A. McCann & Co., and the remainder belongs to the plaintiff, and she is entitled to a verdict for it. And if the jury take this view of the evidence, then they have to allow the defendants only such advances, expenses or other just claims as they have proved. If the jury take that view, you will allow the defendants what would represent their advances and just claims against McCann & Co., up to the time of Jerome Smith’s death, and no longer.” * * *
    The verdict was for the plaintiff for $3700.
    The defendants took a writ of error.
    They assigned for error:
    I, 2, 3. The admission of plaintiff’s offers of evidence which were objected to.
    4. Affirming plaintiff’s 5th point.
    5-9. Refusing to affirm the defendants’ 1st, 2d, 3d, 6th and 10th points.
    10. The answer to defendants’ 9th point.
    11. The portion of the charge above quoted.

      J. B. Gest and G. W. Thorn, for plaintiffs in error.
    The deposition of Poey neither proved nor tended to prove any material fact in issue; the evidence offered must correspond with the allegations and be confined to the point in issue. This rule excludes all evidence of collateral facts. Such evidence tends to draw away the minds of the jurors from the point in issue, and to excite prejudice and mislead them: Greenl. Ev. §§ 51, 52; Weidler v. The Farmers’ Bank of Lancaster, 11 S. & R. 134. Neither the death of Jerome Smith, nor the time of his decease, was put in issue by the pleadings. The general issue admits the character in which the plaintiff sues as set out in the declaration: Carpenter and Rose, overseers, v. Whitman, 15 Johns. 208; Kennebec Purchase v. Call, 1 Mass. Rep. 483; State Treas. v. Wiggins, 1 McCord 568; Truax v. Truax, 1 Pennington 166; Floyd v. Breckenbridge, 4 Bibb 14; Henderson’s Admr., Id. 391; Thomas v. Tanner, 6 Monroe 52; Chaplain v. Tilley, 3 Day 303. There was no plea in abatement or other plea putting in issue the right of the plaintiff to sue as administratrix: Conard v. Atlantic Ins. Company, 1 Pet. U. S. Sup. Ct. 386; and therefore the death of intestate was admitted. The assignment vested the right to receive the money in the assignee: Angell on F. & L. Ins., ch. xvi., sect. 326, p. 361; Harrison v. McConkey, 1 Johns. Ch. R. 34; Palmer v. Merrill, 2 Cush. R. 282; Fortesque v. Barnett, 3 M. & K. 36.
    It is not necessary that the assignee should have any interest; he stands on the rights of the party who effected the insurance: Ashley v. Ashley, 3 Simons 149; Barber v. Morris, 2 Mood. & Rob. 62. A man may insure his life and present the policy as a gift to a friend: Ins. Co. v. Robertshaw, 2 Casey 191; Elliott’s Appeal, 14 Wright 80. The defendants having paid the premium on the policy, they were entitled to the benefit of the same: Bruce v. Gardon, Law Rep. 8 Equity 429; 15 Id. 32; Godsal v. Webb, 2 Keene Ch. R. 99.
    A voluntary assignment by a person of a policy of insurance on his own life is good as against his executors and administrators : Elliott’s Appeal, 14 Wright 80; Ashley v. Ashley, 2 Simons’ R. 149; Valton v. The Nat. Ins. Society, 22 Barb. 9.
    A scintilla of evidence or a mere surmise that the contract was other than the writing showed, would not justify the judge in leaving the case to the jury : Railroad v. Hummell, 8 Wright 377; Cotton v. Wood, 98 Eng. Com. L. Rep. 568; Howard Express Co. v. Wile, 14 P. F. Smith 201; Elliott v. Ins. Co., 16 Id. 22.
    The defendants had an insurable interest on the life of Smith by reason of their contract with McCann k Co., and were interested in their future profits: Valton v. Nat. F. L. Asso. Soc., 19 Barb. 9; Morrell v. Trenton Ins. Co., 10 Cushing 282; Miller v. Eagle L. Ins. Co., 2 E. D. Smith 268.
    The sum to be received is not limited by the amount of interest : Runyon on Life Ins. 23, 4; Dalby v. London Life Ins. Co., 15 C. B. 365; Law v. London I. L. P. Co., 19 Jurist 178.
    G. Junkin, for defendant in error.
   The opinion of the court was delivered, February 8th 1872, by

Sharswood, J.

We are of opinion that the evidence offered by the plaintiff below and received by the court under exceptions, by the defendants, which forms the subject of the first three specifications of error, was irrelevant and inadmissible. More than that, it was calculated to distract and divert the attention of the jury from the only true point in issue, which was, whether the assignment of the policy on the life of Jerome Smith by the Connecticut Mutual Life Insurance Company, No. 88,435, to the defendants was absolute or as collateral security for advances by the defendants. That this was the true and only question which arose upon the evidence, is abundantly clear, and indeed is not disputed. The only ground upon which it has been attempted to sustain the admission of the evidence is that it proved the fact of the death of the insured. It is said that this fact was essential to the plaintiff’s recovery, and that although it was an admitted fact, the plaintiff was not bound to accept the admission, but could insist on proving it, and if the evidence of it gave her any collateral advantage with the jury she was entitled to the benefit of it. This may be true in general, but it is not true when the fact in question is conclusively admitted by the pleading, as was the case here. The action was by the plaintiff as the administratrix of Jerome Smith. There was no plea in abatement denying the death of Jerome Smith, and setting up the consequent invalidity of the letters of administration. The letters are not only in all cases primS, facie evidence of the death of the person on whose estate they are granted, but when there is no plea to them and consequently no issue made upon the grant, they are conclusive evidence of the fact of death: 1 Greenl. on Ev. § 550; Newman v. Jenkins, 10 Pick. 515; McKimm v. Riddle, 2 Dall. 100; Ayers v. Musselman, 2 P. A. Browne 115.

The next six specifications of error, which are to the answers of the court below to the points of the plaintiff and defendants, may all be resolved into one question, whether there was any sufficient evidence to submit to the jury upon which they could find that the assignment of the policy No. 88,435 was as a collateral security for present or future indebtedness by the assignor to the assignees. The defendants may have had such an interest in the life insured under the contract of September 1st 1868 as would have entitled them to insure his life in their own names. That, however, might have been a question. But Jerome Smith’s*interest in his own life was unquestionable, and if he was willing to insure himself with their money and then assign the policy to them, there is no principle of law which can prevent such a transaction. Indeed this is not controverted. Now, not only was the assignment in question on the face of it simple and absolute, but it was specially expressed so to be under the hand and seal of Jerome Smith himself. “I hereby assign, transfer and set over absolutely,” is its language. Mr. Tilden, the agent of the insurance company, by whom the assignment was drawn and witnessed, testified, “Jerome Smith said it was to be an absolute and unconditional assignment.” Two other witnesses testify to other dedurations by him of the same import, at or about the same time. Mr. Morgan said : “There was then a further conversation about a policy to be taken out for the benefit of the firm, and as to whether there would be any difficulty in their taking out a policy which would secure them the amount of it in case of his death, whether they had any interest or not. Mr. Smith said they could take out a policy for whatever amount they liked if they would pay the premium.” And again : “ It was understood that this policy had nothing to do with their advances to Mr. Smith or to' the business in Mexico. I heard Mr. Cunningham say this to Mr. Smith.” Winthrop R. Cunningham in his deposition said: “ W. T. Cunningham said distinctly to Jerome Smith that he wanted it clearly understood that in any insurance that he effected for the firm, that if he died, we made the insurance, if he didn’t, we lost the premium. I remember these words; Jerome Smith fully assented to this.” And again : “ It was clearly understood and agreed upon between Mr. Smith and W. Cunningham & Sons that it was to be solely for the benefit of W. Cunningham & Sons free from any, claim of any kind.” The testimony of these witnesses was in support of what appeared on the face of the writing. On the other hand, what is set up to impeach the writing thus sustained ? First, the testimony of the plaintiff to a declaration by one of the defendants after the death of Smith, that they had taken out the policy to secure them against losses, and, second, the testimony of Henry K. Smith, a son of the plaintiff, that he had overheard the same conversation, and that Mr. Cunningham said “ that they had lost the policy that they expected would coverall the expenses;” and again: “that the one taken out to secure them was lost.” It may be that there was a time when this would have been considered a scintilla of evidence, sufficient to justify the submission of the case to the jury, but that doctrine is now exploded: Howard Express Company v. Wile, 14 P. F. Smith 201. It was evidently insufficient to authorize the jury to draw the inference that the assignment was other than absolute, and the question ought not therefore to have been submitted to them. It was a mere loose declaration, in the course of a casual conversation, unaccompanied with any admission of liability, at a time when the declarant supposed that the policy had been lost for want of the payment of the premium in proper time. It could not fairly be intended to mean, that the insurance was designed to secure the defendants for advances; but simply to secure them against losses and expenses generally in that business in which they had engaged with Jerome Smith, and on account of which they had insured or wished to insure his life. Under such a contract as they had made with Mr. Smith, they might well look forward to the contingency of losses and expenses other than those which would result from the failure of Smith to refund advances made to him. They contemplated consignments of merchandise to him for sale in Mexico or to the firm of' McCann & Co., of which he was to be a member, and such consignments instead of resulting in profits, might end in losses and expenses which the defendants would have to bear. Upon this, which is the most reasonable interpretation of the language, there was nothing to contradict the absolute character of the assignment.

As to the 10th assignment, the learned judge was certainly right that in point of law it was not material whether the premium on the policy was paid before or after the death of the insured. If so, it wras an error to submit the question to the jury- _

_ It is unnecessary to consider the 11th assignment. No doubt, upon the basis that the policy was assigned to the defendants as a mere collateral security for advances made to or debts owing by Jerome Smith, or the firm of which he was a member, the answer of the learned judge was entirely correct.

Judgment reversed, and venire facias de novo awarded.


text:
    Walden et al. versus Finch et al.

    1. Permitting a witness to be contradicted in matters as to which his attention had not been called in his examination, is within the discretion of the court trying the case.
    2. An abuse of the discretion would be corrected by a court of error.
    3. When the witnesses are all present and the contradiction tends seriously to impair the credibility of the witness or affect his character ; he should have an opportunity of explanation or denial.
    4. Circumstances in this case justifying contradictory evidence, without having called witness’s attention to the matter.
    5. When an owner has done all in his power to erect a safe structure, he is not liable to others for its occult defects, if he had not knowledge of them nor reason to believe their existence.
    February 1st and 2d 1872.
    Before Thompson, C. J., Agnew and Sharswood, JJ. Williams, J., at Nisi Prius.
    Error to the District Court of Philadelphia: No. 284, to January Term 1871.
    This was an action on the case by Edward Walden and Christian F. Koehn, trading, &c., against Joseph S. Finch and John W. Painter, trading, &c.
    The suit was for the loss of 139 half-barrels of plaintiffs’ whiskey which had been destroyed by the falling of a storehouse of defendants in which the whiskey had been stored; the plaintiffs alleging that the house had been negligently built by defendants. The plaintiffs gave evidence that they had bought of the defendants whiskey which continued in the defendants’ bonded warehouse until the 14th of May 1869, when the building fell, by which 189 half-barrels were destroyed. The building was in East Birmingham, near Pittsburg.
    On the question of negligence in erecting the building the plaintiffs read the deposition of J. W. Kerr, taken at Pittsburg, under cross-examination; the witness was an architect of thirty years’ experience: he testified that about August 1st 1868, the defendants employed him to prepare a plan for the storehouse; that at the time the defendants showed witness contracts which they had entered into for the brick and stone work, witness told him good work could not be done at the prices named; that defendants agreed to allow him his prices if good work could not be done at those rates; witness, in connection with C. C. Kemble, an assistant architect in-his employ, furnished to defendants a plan, which would have made a substantial building of sufficient strength, if the plan had been pursued and good materials had been put into the building; that defendants had altered the plan so as to weaken the building, that the materials were not good, the workmen were not competent and did not do their work well; that witness frequently informed the defendants of these things; they persisted in them; the witness testified to other facts tending to show negligence on the part of the defendants in the erection of the building and refusing to carry out the instructions and directions of the architect.
    They read also the deposition of Kemble, taken in Wheeling under a commission on interrogatories and cross-interrogatories; his testimony was of much the same character as Kerr’s.
    They gave evidence by a number of other witnesses, also tending to show negligence of the defendants in the erection of the building.
    The defendants gave evidence tending to show that the building had been carefully erected by competent workmen, with good materials: the brick and stone-work done under the constant superintendence of an experienced bricklayer; that when bad material in any instance happened to be put in, or improper work done, they were changed; they also gave evidence that the building had been erected in accordance with the plans of Kerr and Kemble and under their supervision.
    They read in evidence the deposition of George Howarth, taken in Pittsburg; the plaintiffs objected to reading the following part of the deposition: “Mr. Kemble expressed himself several times, that his reputation depended on that warehouse. He expressed himself very well satisfied with the character of the work several times.”
    The plaintiffs objected to reading that part of the deposition, because, if it was intended to contradict Mr. Kemble, the ground therefor had not been laid by examining him respecting the said conversation.
    The defendants proposed to ask other witnesses called by them respecting conversations with Kerr and Kemble; the questions were objected to for the same reasons. All the offers were admitted and several bills of exceptions sealed.
    The coui’t charged:—
    “ This is an action brought by the plaintiff to recover the value of a quantity of whiskey which had been destroyed or lost under the following circumstances: It seems that the defendant erected near Pittsburg, in the fall of 1869, a warehouse for the purpose of receiving goods upon storage, and that the plaintiffs had stored there some four hundred half-barrels of spirits or whiskey. The building in which the whiskey was deposited shortly after its completion fell to the ground, carrying with it and destroying a large portion of the goods of the plaintiffs, who now seek to recover the value of what was lost. About the fall, that the plaintiffs had the spirits there, and that the building fell and it was destroyed in the fall, there is no dispute; in fact, there were two falls of the building, one about three weeks before the final and destructive one. The plaintiffs claim that the building was improperly constructed of bad and imperfect material, and that, although a plan and specifications had been furnished, they were not regarded, and the building not erected in accordance with them, and that Mr. Kemble, who had made the plans and specifications, in fact left the work before its completion, and refused to have any connection with it on that account. This is denied by the defendants, who say that the best material was used and the best workmen employed, and that if any changes were made in the plans, it was done with the consent of Kerr.
    [“I state to you that if the warehouse was planned by a competent architect, and specifications made by him, and the building was constructed under the direction of such an architect by competent employees and with suitable materials, in conformity with the plan and specifications, the defendants would not be liable to the plaintiffs for the injury complained of.j”
    The verdict was for the defendants.
    The plaintiffs took a writ of error, and assigned for error the admission of the evidence objected to, and the part of the charge in brackets.

      J. H. Gendell and E. S. Miller (with whom was T. J. DiehT), for plaintiffs in error.
    Before a witness can be contradicted by showing that he has made inconsistent statements, he must be examined respecting them : Stark, on Ev. 239; 1 Greenl. on Ev. § 462; McAteer v. McMullen, 2 Barr 32; Wertz v. May, 9 Harris 274; Wright v. Cumpsty, 5 Wright 102. As to the charge they cited Godley v. Hagerty, 8 Harris 387; Carson v. Godley, 2 Casey 111.

      H. J. McCarthy and Porter, for defendants in error.
    It is not well settled that before a witness can be contradicted by showing that he has made inconsistent statements he must first be examined respecting them. It is a matter for the discretion of the court on the trial: Sharp v. Emmet, 5 Whart. 299; Kay v. Fredrigal, 3 Barr 221; McKee v. Jones, 6 Id. 425; Craig v. Craig, 5 Rawle 91; Tucker v. Welsh, 17 Mass. 160. The witness may have gone away out of the jurisdiction, and in the case of a deposition the course would be impracticable: McKelvy v. De Wolfe, 8 Harris 374; Travis v. Brown, 7 Wright 9; Perkins v. Adams, 5 Metc. 44. As to the charge: When an injury is done by one exercising an independent employment, the person employing him is not responsible to the person injured. The owner is not responsible for the acts of the architect or contractor: Willard v. Tatham, 7 P. F. Smith 374; Meany v. Abbott, 6 Phila. R. 256; Painter v. Pittsburg, 10 Wright 222; Daegling v. Gilmore, 49 Ill. 248; Blake v. Ferris, 1 Selden, N. Y. 48; Allen v. Hayward, 7 A. & E. N. S. 960; Rapson v. Cubitt, 9 M. & W. 710; Milligan v. Wedge, 12 A. & E. 737; Hilliard v. Richardson, 3 Gray 349.
   The opinion of the court was delivered, May 13th 1872, by

Agnew, J.

— There are but two questions in this record which need to be noticed. The first, upon the admission of testimony to contradict Kemble and Kerr, without having called the attention of these witnesses to the conversations intended to be proved, is an unsettled question in this state, as may be seen in the diverse decisions cited in the argument. The practice has arisen out of regard to the witness himself to enable him to explain any seeming discrepancy in his statements. Yet it must necessarily have its just boundary, or otherwise it leads to the sacrifice of the interests of the parties litigant. In some cases a court -would feel bound to require the witness intended to be contradicted to be first examined, and his attention called to the supposed contradiction. Yet there are others where an unbending rule to this effect would work great hardship. Thus where, as in this case, the witnesses have been already examined under a rule or a commission at a distant place, preparatory to the trial, it would often be difficult to foresee, sometimes impossible to foreknow, the questions to be put to the witness on cross-examination in order to lay ground to contradict him. Indeed in such cases unworthy witnesses might be purposely examined under a rule at a distance in order to prevent the ground from being laid. The names of the witnesses are seldom given who are examined under rules within the state, and even when examined under commissions the witnesses are not always named. It would be unjust to the party in such a case to deprive him of the opportunity of contradicting unworthy witnesses. We are therefore of opinion that those decisions of our own court are to be preferred which hold that the question is one of sound discretion in the judge trying the cause upon the circumstances before him. Where the witnesses are all present, and the contradiction tends seriously to impair the credibility of the witness, or to reflect upon his character, a court would feel bound to give him the opportunity of explanation or denial, before suffering his testimony to be impeached by counter statements. Under different circumstances a court would feel it proper to relax the rule. An abuse of this discretion would be corrected, but we discover none in the present instance.

The second question arises upon the charge. The judge said to the jury: “ And I state to you that if the warehouse was planned by a competent architect, and specifications made by him, and the building was constructed under the directions of such an architect by competent employees, and with suitable material, in conformity with the plans and specifications, the defendant would not be liable to the plaintiffs for the injury complained of.” There was evidence that the building was constructed under the direction of Kemble, an architect, and according to the plan of Kerr, the chief architect, though this was strongly contradicted. There were contradictions also as to competency of the employees and the materials. The evidence necessarily went to the jury, and the facts were fairly submitted. The only real question is, therefore, whether the principle contained in the judge’s charge is correct as a matter of law. The principle appears to be this: that when the owner of a building has done all in his power to erecta safe structure for the purpose for which it is to be used, he is not liable to others for its occult defects. Of course this is to be taken with the qualification that he had no knowledge of the defect, and no reason to lead him to'believe the building to be unsafe. No question of a scienter appears in the case, and we must take the meaning of the court to be as thus qualified. So far as we can gather from the paper-book the case appears to have gone to the jury solely on the question of negligence. The declaration is not printed in the paper-book, and the argument makes no reference to any other question. We must assume, therefore, that no question arose on the contract of storage, whatever were its terms. How far one who takes goods to store for him will be responsible on his contract for storage, must often depend on the nature of the contract; but assuming in this case, as we must from the paper-book, that the only question was that of negligence in erecting the warehouse, as a house for storage, we cannot discover any error in the instruction of the court. The principle would be one of unusual and unreasonable scope, if the owner of a building should be held to be liable to the depositor of goods, for unknown and hidden defects in the structure, when he has taken all proper care to make it safe. As life and personal security are more valuable than goods, the principle would extend to a dwelling-house; and one who has friends to dine with him, or who has invited them to a reception, might find himself ruined in fortune, as well as agonized in feelings, by an untoward accident which has maimed or killed his guests. Those things which we now term accidents or misfortunes, would then be faults, and be followed by civil penalties. But merely good faith and reasonable prudence are all that can be required of the owner of such a building, and when he has shown that he has honestly taken all the pains he can to make his structure safe and adapted to the purpose for which it is to be used, the person who stores his property in it, if he would require a greater security, should provide for it in his contract. A severer rule would lead to consequences so harsh, no one would reasonably undertake to suffer them when he builds,' and would indeed tend to discourage improvement.

Judgment affirmed.