author: Mr. Justice Tbunket Mr. Justice Trunkey

text:
    Carson’s Appeal.
    1. The terms of the Act of April 18th 1853,§9, Pamph. L. 503, in relation to accumulations, render invalid a direction by a settlor or testator that accumulations shall be capitalized and the interest thereon paid to the beneficiary after be has attained majority. Such accumulations belong absolutely to the beneficiary "when he comes of age.
    2. Washington’s estate, 25 P. F. Smith 102; Stille’s estate,-4 W. 1ST. C. 42; and McKee’s appeal, 15 Norris 277, followed.
    8. It can make no difference as to the disposition of such accumulations whether they accrued prior to the death of tlic settlor or after that event.
    January 10th 1882.
    Before Sharswood, C. J., Meroub, Gordon, Paxson, Tkunkey, Sterrett and Green, JJ.
    Appeal from the Court of Common Pleas No. 2, of Philadelphia county: In Equity: Of January Term 1881, No. 151.
    Appeal of James w. Carson and W. W. Keefer, trustees, from a decree of said court directing the payment by them of certain accumulated income to Mrs. Ella V. Nutter, the cestui que trust under a deed of trust.
    The bill in equity, filed by John N. Nutter and Ella Y. Nutter, his wife, formerly Ella Y. Baird, in her right, against James W. Carson and W. W. Keefer, trustees, set forth as follows:
    On April 12th 1866, Matthew Baird, by an indenture of that date, assigned and transferred to the defendants certain securities, exceeding in value $500,000, in trust for his three sons and his three daughters, of whom the complainant Ella is one, in equal sixth shares, in manner following, viz.: as to his sons, as therein set forth; and as to his daughters, in trust “ to invest, and keep invested, the remaining three full equal sixth parts of the stocks, loans, personal effects and securities, hereby granted and assigned; and to pay and apply the interest, income, dividends and profits thereof, to the support, maintenance or education of Ella Y. Baird, Mary L. Baird and Florence A. Baird, daughters of the said Matthew Baird, for their sole and separate use, until they respectively attain the age of twenty-one years, or marry, or if, in the opinion and discretion of said trustees, said interests, income and dividend, or any portion thereof, shall not be needed for this purpose, then to re-invost the same, from time to time, together witli any portion of the principal of the estate and property hereby granted and assigned, which they may change and replace in the securities before mentioned; and from and after the marriage of said daughters respectively, or tlieir arrival at the age of twenty-one years, whichever event shall first happen with each of them, then, m fy'ust, to pay the dividend, interest and income of one full equal third part of said three-sixth of said stocks, loans and securities, together with the accumulations of income, which shall have been invested, as the same shall be received, unto Ella Y., Mary L. and Florence A. Baird, respectively, for their respective sole and separate use, upon their separate receipts, without the control or interference of any husband or husbands they may have or take, and without being subject or liable to his or their debts, contracts or engagements, for and during all the term of the natural lives of said daughters respectively, and from and immediately after the decease of either, any, or all of said daughters, then, in trust, to and for the only proper use and behoof of such persons and for such estates, as the said Ella Y., Mary L. and Florence A. Baird, respectively, by their respective last wills and testaments, to be signed by them, respectively, in the presence of two credible witnesses, shall direct, limit and appoint, or in default of such will and appointment, then, in trust, to and for the only proper use and behoof of all and every the child and children of said daughters that shall then be living, and the lawful issue of such of them as may then be deceased, their respective heirs, executors, administrators and assigns, forever, in equal shares, but so, however, that such issue shall take and receive only such part or share of his, her, or their deceased parent would have taken if living, and in default of such child or children and issue thereof, then in trust to and for the use and behoof of tho heirs and legal representatives of such daughters respectively.”
    Matthew Baird, having a large other estate, maintained his children from the date of the deed of trust, in 1866, until his death, in May 1877, by reason whereof nearly all the income of the complainant Ella’s share was accumulated by the trustees, the same now amounting to over $100,000.
    The complainant, Ella, arrived at the age of twenty-one years August 11th 1877 and was married to John R. Rutter in January 1878. '
    ' The bill prayed for a decree that the trustees pay and transfe]’ to her absolutely the said accumulations of income from her trust estate, from the beginning of the trust to the date of her arrival of age.
    The defendants filed a plea to the bill, averring “ that the said Matthew Baird upon and at the time of his directing the drawing of the said deed of trust, and execution thereof, declared his intention and purpose thereby to be that the accumulations of the income of the shares of his daughters, until they should be twenty-one years old or marry, respectively should not, upon their arrival at the age of twenty-one years of age or marriage, respectively, be paid by the said trustees to them respectively, absolutely, but should remain in said trustees’ hands during his said daughters’ lives respectively, in trust to pay to them, respectively, the income only of said accumulations, and that the said Matthew Baird so declared his said intention and purpose to the said W. W. Keefer.”
    The court, after argument, entered a decree overruling the defendants’ plea, and directing the defendants to pay and transfer to the complainant, Mrs. Rutter, all the said accumulations of income accrued prior and up to the time of her majority, and the securities wherein the same were invested.
    The defendants thereupon took this appeal, assigning for error the said decree.

      George L. Orawford, for the appellants. —
    "We contend (1) That the proper construction of the deed’ of trust, shows that the settlor’s intention was that the surplus accumulations of income of Mrs. Rutter’s share during her minority, should be added to her principal, and be subject to the trust thereof, for her for life, and upon her death, for her appointees by will, or her issue. (2) That if such is not the construction of the words of the deed, if was Mr. Baird’s actual intention, declared at the time, as averred in the plea, and admitted in disposing of the ease on bill and plea, according to which the deed should be reformed. (3) The Act of April 18th 1853, does not invalidate that disposition of her income during her minority. The Act does not prohibit such accumulations being capitalized with the original capital, and the income only of the whole, to be given to her upon and after majority.
    The Thelusson Act prohibits trusts for accumulation of income, except for four different terms, which are in the disjunctive, and cannot be cumulated: (1) during the grantor’s life, or (2) for twenty-one years from his death, or (3) during the minority of any person living at his death, or in ventre sa mere, or (4) during the minority of any person, who, under the trust, would, for the time being, if of full age, be entitled to the income directed to be accumulated.
    The Pennsylvania Act lias abridged the right of accumulation somewhat less than the English Act, by adopting its first and fourth terms, cumulated by allowing accumulation during both periods, instead of either period.
    The trust, as to the accumulations here, is within the exceptions to the prohibition of the Act of 1853. Mrs. Rutter and Mr. Baird, being both in existence at the creation of the trnst, the term for accumulation — during her minority — is necessarily within the period comprised by the life of the grantor, and twenty-one years thereafter. The thing prohibited by the Act is the accumulating of income beyond a certain term, not the donor’s free disposition of the income accumulated within a permitted term. Such is the construction of the similar phrase in the Thelusson Act, and also under a similar statute in New Fork: Meserole v. Meserole, 1 Hun 66. To require that the accumulations during minority shall be paid over to the beneficiary, absolutely, at majority, destroys the force of the subjunctive mood, “ would, for the time being, if of full age, be entitled,” etc.; and adds to the prohibitions of the Act. If the Act wholly prohibits the giving of accumulations to anyone else than the minor, then a gift over in case of the death of a minor during minority would be impossible.
    The only Pennsylvania cases touching the question are the recent ones of Washington’s Estate, 25 P. F. Smith 102 — which was really a case of allowance to minors, covered by the second clause of the act; Stillé’s Estate, 1 W. N. C. 249; 32 Leg. Intel! 74; Stillé’s Appeal, 4 W. N. O. 42 — in which the court, without hearing argument, followed Washington’s Estate; Sergeant’s Estate, 32 Leg. Intel! 29 ; and Howell’s Estate, 5' W. N. C. 430 — both decisions of the Orphans’ Court, following Washington’s Estate; and McKee’s Appeal, 15 Norris 27f. This is practically the first time the precise question here raised has ever come fairly before the court. No policy of the law requires a donor to give the accumulated income of a minor to him, upon arriving at age, the period when most likely to be injurious to him, while its capitalization, and the income thereof, would be most likely to be beneficial to him ; on the contrary, the same policy of the law which favors accumulations during minority, repels the compulsory subjection of them to the free control of the minor when just of age.
    The direction for accumulation during the settlor’s life is unquestionably valid, and Mrs. Rutter therefore cannot be entitled to those, even if she is entitled to accumulations after Mr. Laird’s death.

      O. W. MoKeehan, for the appellees,
    relied upon Washington’s Estate, and the subsequent Pennsylvania cases, cited in the argument of counsel for appellant.
   Mr. Justice Tbunket

delivered the following opinion, February 6th 1882.

In Washington’s Estate, 75 Pa. St. 102, it was decided that so much of the will as directed that the accumulations of the estate of the testator, during the minority of his only child, upon her arrival at full age should form a part of his estate, and thereafter the income of the estate to be paid to said child during her life, was in conflict with the Act of April 18th 1853, and that said accumulations, by virtue of the statute, vested in and were payable to the child' at her majority. The petition averred that when the minor should become of age she would be entitled to the whole of the accumulations, which the answer denied, and asserted that they did not belong to the minor, but to the remaindermen. TJpon this issue the cause was heard. As shown by the printed argument the counsel for the appellant declared at the outset that but one question of law was involved, namely, “ Did the court below rightly decide, that, in order to justify an accumulation under the Act of April 18th 1853, the income directed to be accumulated during a minority must he given to the minor upon his attaining Ms majority, otherwise the direction is an excess ?” Both the master and the court below elaborately considered the points now raised, and reviewed the English decisions under the Thelusson Act, and the American cases under similar statutes. Possibly the cause might have been decided the same way upon another point, hut it was not, for no other was considered by the court below or this court.

It is conceded, that the point in question in the present case directly arose in Stillé’s Estate, 4 W. N. C. 42, and was decided without argument, on the authority of Washington’s Estate. Upon the same authority the recent case of McKee’s Appeal, 96 Pa. St. 277, was determined, and if it be true that the case could have been so decided on other grounds, such other ground was not noted.

Washington’s Estate is the first reported case adjudicated under the Act of 1853, and ever since it has controlled the disposition of such cases of accumulations. The opinion in the Orphans’ Court was delivered by Justice Paxson, who was then one of the judges thereof, in which he said, “ It is difficult to see the wisdom of any act which requires, in a large estate, the accumulated income of a minor to be paid to him, in all cases, upon his arrival at full age. There are mauy instances where such a thing would be in jurious to him in the highest degree. The capitalization of the income, and the payment to him only of the interest after his majority, would often promote his best good. There would seem to be no reason of public policy demanding such a change in the right of disposing of property. And I desire to call the attention of the profession to the fact that our Act does not, as the Thelusson Act does, allow accumulation for the purpose of the payment debts, or to provide for raising portions for children.’ 8 Phil. R. 182. Time enough has elapsed for legislative correction, if the intendment of the statute has been misapprehended by the courts. The ingenious argument for the appellants is convincing that much may he said favorable to the opposite construction, and that the intendment-is not so clear as to preclude doubt; but we are not convinced that the repeated and uniform decisions upon the very question now presented should be overruled. Stare decisis.

Decree affirmed, and appeal dismissed at the costs of appellants.

The appellants subsequently presented an application praying for a rehearing and a modification of the decree as to that portion of the fund derived from accumulations of income between the date of the creation of the trust and the date of Matthew Baird’s death, the appellants contending that Mrs. Rutter was not entitled thereto; and citing 1 Jarman on Wills, *306 ; Hays and Jarman’s Precedents 351; Theobald on Wills 305; McKee’s Appeal, 28 Pitts. Leg. Jour. (O. S.) 371; s. c., 15 Norris 277.

Mr. Justice Trunkey

delivered the opinion of the court, February 27th 1882.

This deed contains no direction for accumulation during the grantor’s life. It vests the property in the trustees, for use of certain persons, with directions for accumulation during their minority. After its delivery the grantor had no interest in, or power to control, the estate. The Act of 1853 applies to an estate held under a deed, just as it would if held upon the same terms under a will. In either case directions for accumulations are void so far as in conflict with the statute, and it can make no difference whether such accumulations, when the property ■passed by deed, accrued within the lifetime of the grantor, or after his decease. The authorities cited by the appellants relate to cases where the trusts were created by will, and show no distinction between them and like trusts created by deed, as respects the question presented in the prayer for a modification of the decree.

Motion for rehearing refused.


source: Caselaw Access Project

author: Mr. Justice Gordon

license: Public Domain

text:
    Waln’s Heirs versus City of Philadelphia, to use of Armstrong.
    1. In order to show the precise terms of a resolution passed by the board of surveys of the City of Philadelphia, in accordance with the provisions of the Act of April 20th 1869, Pamph. L. 1190, recommending to city councils the passage of an ordinance authorizing the construction of a branch sewer, the original minutes of the meeting of the board at which the subject was referred to a sub-committee, the original report of that sub-committee, and the original draft of the final resolution of the board may, upon being produced and duly authenticated, be offered in evidence.

      3. A resolution of the city councils of Philadelphia, in order to have the force of law, must be signed by the mayor, published and recorded. A resolution lucking in these requirements is without force or effect.
    3. Under the provisions of the Act of April 30th 1809, Pamph. L. 1190, it is not necessary that the report and resolution of the board of surveys recommending the construction of a branch sewer should set out that said sewer is necessary for public health, comfort or convenience. City councils are the sole judges of the propriety of constructing the sewer. Presumptively they act for the public good, and in uo case where they have authorized such construction can their judgment in the matter be reviewed.
    January lltli 1882.
    Before Shaksavood, O. J., Mercur, Gordon, Paxson, Turnkey, Stbrrett and Green, JJ.
    Error to the Court of Common Pleas No. 3, of Philo delj)hia county: Of January Term 1881, No. 96.
    Scire facias stir muneipal claim, by the city of Philadelphia, to the use of William Armstrong, against the heirs of J. S. Wain, deceased. Tlie claim was for work done in constructing a sewer along Twenty-fifth street, between Locust and Manning streets, in front of two lots of ground belonging to defendants, one on each side of said Twenty-fifth street, said sewer having been constructed in pursuance of an ordinance of City Councils approved November 23d 1869. The Act of Assembly relating to the construction of sewers in the city of Philadelphia, approved 8th of April 1864 (P. L. 324), enacted—
    “ That the city of Philadelphia should have power to construct sewers in the streets of the said city. . . . Provided, however, that for branch sewers the consent or request in writing of the majority of the owners of property fronting on the street or streets intended to be culverted, be first obtained, and filed in the office of the Department of Sewers.”
    The Act of Assembly, approved 20th of April 1869 (P. L. 1190), enacted — •
    “ That the Select and Common Councils of the city of Philadelphia shall have power and authority to order and direct the construction of branch sewers in said city whenever the same shall be approved by the Board of Surveys, and in the opinion of Councils shall be required for the health, comfort, and convenience of the inhabitants of said city, and that the provisions of the Act entitled ! A Further Supplement to the Act to Incorporate the City of Philadelphia,’ approved April 8tli 1864, shall not be construed so as to apply to the same.”
    Cn the trial, defendants offered in evidence a joint resolution of the Select and Common Councils of the city, passed in December 1869, instructing tlie Chief Commissioner of Highways not to proceed with the construction of the sewer in question until the owners of property abutting on the street where it was to be laid could be heard in opposition to the same. This resolution was not signed by the mayor nor published nor recorded. Objected to by plaintiff. Objection sustained. Evidence rejected. Exception. (Second assignment of error.)
    Defendants then put in evidence the following petition to construct the sewer in question, which had been presented to the board of surveys.
    Gentlemen: We, the undersigned, owners of property situate on the line of Twenty-fifth street, between Locust street and Spruce street, hereby request that a sewer or drain may be constructed on the line of said Twenty-fifth street, from street to street, as aforesaid, under the authority and subject to the conditions as specified in ordinances regulating the assessment upon property for the construction of sewers, approved May 12th 1866.
    F. Dinan,
    and five others.
    This was to show that the approval of the board of surveys as required by the Act of April 20th 1869 (P. L. 1190), to the construction of the sewer in question had been given to its construction from Locust street to Spruce street, and not from Locust street to Manning street. In order to rebut this, plaintiff called George Sturgess, who testified as follows: “I was the secretary of the board of surveyors in the year 1869; I have the original minutes of the resolution as to the sewer on Twenty-fifth street, as passed by the board: I here produce it; it is in lead pencil; it is the rough minutes of the proceeding of the board; made at the time. From this is made up and copied out the clean minutes, which are written in ink in the regular minute-book.”
    , Plaintiff here put in evidence the rough minutes, as follows : -
    “ Stated meeting of the board, held November 1st 1869.

      “ Petition for sewer on Twenty-fifth street, between Locust and Spruce streets, referred to
    Messrs. Shedaker, ) Committee who reported resolutidn Roberts, V recommending a three-foot sewer. Wole, ) Agreed to,”
    Witness, Sturgess, then continued his evidence, as follows : “ I have, and also produce, the original draft of a resolution submitted by a sub-committee of the board of surveyors, to whom the question of the sewer had been referred, and annexed to their report to the board, recommending the construction of the sewer on Twenty-fifth street, from Locust to Manning streets. This was the resolution offered in the board on the day named and passed by the board, and is that to which the lead-pencil minutes refer. I am also the clerk of the survey committee of city councils, and as such clerk drew the ordinance which was reported from that committee and passed by councils. I made the draft from the resolution of the sub-committee of the board of surveyors.”
    Plaintiff then offered in evidence the report of the sub-committee of the board of surveyors and the accompanying resolution, above referred to, as follows:—
    “ Philadelphia, November 1st 1869.
    “ To the President and Board of Surveys.
    “ G-entlemen: Your Committee, to whom was referred the within application for a sewer, report that the details of said sewer, as asked for, will be as follows, viz.: length, 350 feet; shape, circular; size, 3 feet; building front, 600 feet; legal deductions, 81 feet é inches; location of inlets, southeast corner of Twenty-fifth and Manning streets; manholes, one.
    “ This sewer is required for surface and water-closets.
    “ Your committee offer the following resolution.
    “ D. II. SlIEDAKER,
    John II. Wole,
    Edward A. Roberts,
    “ Committee.

      “ Resolved. That the board of surveyors recommend to councils the construction of a three-feet brick culvert on the lino of Twenty-fifth street, from Locust street to south side of Manning street.”
    Objected to. Objection overruled and evidence admitted. Exception. (First assignment of error.)
    Defendants requested the court to charge as follows: “ That before the plaintiff can recover he must show that a majority of owners of property fronting on Twenty-fifth street, along the line culverted, consented to the construction of the said sewer, and signified such consent by writing, duly filed in the office of the department of surveys.” Answer. In answer to the first point, I say that a consent of the majority of property owners is not material. (Third assignment of error.)
    The court charged the jury, inter alia, as follows: “ The lead-pencil minutes of the meeting of the board of surveys, held November 1st 1869, are explained by the resolution of the sub-committee, offered, and, according to Secretary Sturgess, adopted by the board the same day, November 1st 1869, but not spread out on the minutes, and contain an approval of the sewer from Locust to Manning streets. The question of fact is left to the jury, whether this action was had by the board.” {Ninth assignment of error.)
    Verdict and judgment for plaintiff. The defendants thereupon took this writ, assigning for error, inter alia, the refusal to admit in evidence the resolution of councils, instructing the city commissioner to suspend work on the sewer in question; the admission in evidence of the report of the sub-committee of the board of surveyors, with the resolution annexed, the answer to defendant’s point above cited, and the portion of the charge above cited.

      John, B. Thayer and JEdward Wain, for plaintiffs in error.
    —The Act of 1869 did not totally repeal the Act of 1864. Therefore the consent of a majority of the property owners was necessary. If it did repeal it, then there should have been some evidence of the necessity of the sewer, but there was none. Moreover, if the Act of 1869 repealed the Act of 1864, then the city has no power to tax the owners of the adjoining property for the construction of branch sewers. That power depends entirely upon the Act of 1864..
    The minutes of the committee of the board of surveys, being the record of the final action of the board, ought not to be overthrown by evidence of the preliminary action of the subcommittee. The best evidence of the official acts of the board is the entry regularly made upon their minutes : Wachot v. School District of Bingham, 8 Phila. 568.
    The resolution of councils ordering the suspension of work on the sewers, operated as a temporary repeal of the prior ordinance. The approval thereof by the mayor was unnecessary.

      Henry O. Terry, for defendant in error. —
    The power of the city to construct sewers or culverts, and charge the abutting properties with the costs thereof, is sustained by the many Acts of Assembly, from February 18th 1769, § 2 (1 Sm. L. 286), to April 20th 1869, § 1 (P. L. 1190): Stroud v. City, 11 P. F. S. 25&; City v. McNeely, 7 W. N. Ó. 573.
    Councils are the sole judges of the necessity for sewers, and their judgment is conclusive on that point: City v. Sellers, 6 Phila. 253; Lipps v. City, 2 Wright 503; City v. Tryon, 11 Casey 401; Stroud v. City, supra.
    Parol evidence was properly admitted to ascertain the truth as to what action was had by the board of surveys : Commonwealth v. Woods, 8 Wright 113; Carr v. Northern Liberties, 11 Casey 324.
    As to the second assignment of error, there was no evidence of the passage of the resolution of councils instructing the commission er not to proceed. The ordinances and joint resolutions as printed and published were not offered: Act of March 21st 1866, § 1, P. L. 262; Sower v. City, 11 Casey 231.
   Mr. Justice Gordon

delivered- the opinion of the court, February 20th 1882.

The defendants are owners of the property on both sides of 25th street, and between Locust and Manning streets.

On the 23d of November 1869, tbe city councils, by ordinance authorized the construction of a three-feet sewer from Locust street to the south side of Manning street. This work was executed in accordance with the directions of said ordinance, by "William Armstrong, the use plaintiff, as contractor. No fault seems to have been found with the character of the work, nor is the general power of the city to charge the cost of such work upon the adjacent property, under the provisions of the Act of March 27th 1865, called in question.

Nevertheless, several exceptions are taken by the defendants to the ruling of the learned judge of the court below, of which, so far as they have been assigned according to rule, we must take notice. These exceptions relate, 1. To the admission of a certain item of evidence and the rejection of another. 2. To the power of the city councils to order the constrution of this sewer. To particularize: the complaint is, first: “That the learned judge below erred in admitting in evidence the report of the sub-committee of the board of surveyors of November 23d 1869, with the resolution annexed. That the learned judge below erred in refusing to admit in evidence the resolution of the city councils, instructing the chief commissioner of highways not to proceed with the sewer in question until the property owners along the line could be heard in opposition to the same.” We may premise the examination of the points thus set forth, by the statement that the main question in this case is one involving the power of the city councils to order the construction of the sewer for which the assessment in controversy was made. If they had such power, everything else appearing to be regular, the judgment of the court below was well rendered, and the defendants’ complaint is without merit and must be dismissed. As we said in the case of McKnight v. City of Pittsburgh, 10 Nor. 273, “It is indeed but a question of power; that being determined, all is determined.” Now, as under the Act of 1869, before the councils, by ordinance, could order the construction of the branch sewer in question, the approval of the board of surveys was necessary, it becomes important to inquire whether such approval is found in this case. The defendants contend that not only does no such approval appear, but that any prima facie presumption that might otherwise arise in favor of the validity of the ordinance, is rebutted by the fact that the contrary is made apparent by the records of the board of surveys. That in fact the recommendation of the board was for the building of a sewer from Locust to Spruce street, and not, as in the ordinance, from Locust to Manning street.

In order to determine the rectitude of this contention, we must necessarily have recourse to the testimony which has been laid before us.

First, then, we have the petition for a sewer on the line of Twenty-fifth street, between Locust and Spruce streets. Second, the report of the committee to whom this petition was referred by the board of surveys, which reads as follows:

“Philadelphia, November 1st 1869. To the President and Board of Surveys. Gentlemen: — Your committee, to whom was referred the within application for a sewer, report that the details of said sewer, as asked for, will be as follows, viz: the length, 350 feet; shape, circular; size, 3 feet; building front, 600 feet; legal deductions, 81 feet 4 inches; location of inlets, south-east corner of Twenty-fifth and Manning streets; manholes, one. This sewer is required for surface and water-closets. Your committee offer the following resolution. Signed, D. H. Shedaker, John JEL "Wolf, Edward A. Roberts, Committee. Resolved, that the board of surveyors recommend to the councils the construction of a three-feet brick culvert on the line of Twenty-fifth street, from Locust street to the south side of Manning street.”

About the regularity of this part of the evidence there is little or no doubt, but the pinch of the case, as the defendants think, is found in the evidence proving the adoption of this resolution by the board of surveyors; and that evidence is as follows: George Sturgess, being affirmed, said : I was the secretary of the board of surveyors in the year 1869 ; I have the original minutes of the resolution as to the sewer on Twenty-fifth street, as passed by the board; I here produce it; it is in lead-pencil; it is the rough minutes of the proceeding of the board, made at that time. From this is made up and copied out the clean minutes, which are written in ink in the regular minute-book.

The plaintiff then offered in evidence the rough minute as follows: “ Stated meeting of the board November 1st 1869. Petition for sewer on Twenty-fifth street, between Locust and Spruce streets. Referred to Messrs. Shedaker, Roberts, Wolf, committee, who reported resolution recommending a three-foot sewer. Agreed to.”

The witness then continues : “ I have and also produce, the original draft of a. resolution, submitted by a sub-committee of the board of surveyors, to whom the question of the sewer had been referred, and annexed to their report to the board, recommending the construction of the sewer on Twentli-fifth street, from Locust to Manning streets. This was the resolution offered in the board on the day named, and passed by the board, and is that to. which the lead-pencil minutes refer. Í am also clerk of the survey committee of city councils, and as such clerk drew the ordinance which was reported from that committee and passed by councils. I made the draft from the resolution of the subcommittee of the board of surveyors.” This is the evidence to which exception has been taken, but to us there appears nothing in it exceptionable. Surely the report of the sub-committee, with its resolution appended, was part of the official records, and the accompanying minutes identify that report by the names of the persons who made it. If this he so, then we have all that is necessary to support the ordinance directing the construction of the sewer from Locust to the south side of Manning street. At the very most, however, nothing but obscurity can be charged against these minutes ; a doubt as to what was the character of the report to which they refer. But, surely, it was altogether proper to remove that obscurity and resolve that doubt by a witness who could produce and identify the original report. Certain it is, that the papers of a county commissioner’s or treasurer’s office, or even those constituting the records of a court, may be thus produced and identified, and there is no imaginable reason why those belonging to the board of surveys should not be subject to the same rule.

Thus fall the defendants’ first and ninth assignments, and as these are the ones principally relied upon by the plaintiffs in error, those that remain require but little comment. The second assignment charges the court below with error in refusing to admit in evidence the resolution of the city councils instructing the chief commissioner of highways not to proceed with the construction of the work until the property owners could be heard in opposition to the same. But according to the case of Sower v. The City, 11 Ca. 231, a resolution of councils is but another name for an ordinance, which, in order to have the force of law, must be signed by the mayor, published and recorded. As, however, the paper offered in evidence was wanting in all these requirements, it was properly rejected.

Finally, the complaint, that neither by the petition, nor by the report and resolution of the board of surveys, did it appear that the sewer was necessary for the public health, comfort or convenience, comes to nothing. This provision of the act addresses itself to the judgment of the councils exclusively. Presumptively they acted for the public good, but if they did not, we cannot go back of their action and sit in judgment upon their motives, or search out the causes that moved them.

The judgment is affirmed.


text:
    McGlade’s Appeal.
    1. A fully executed and completed gift of personalty made within, a month of the donor’s death is valid and effectual, and is not within the prohibition of the Act of April 26th 1855, § 11.

    2. A., having made a will whereby she bequeathed legacies to charities and the residue of her estate to B. for charitable purposes, finding that her death was imminent, executed a letter of attorney to transfer loan, and handed the same, together with the certificates of loan, to 0., with instructions to sell said loan, to pay the amount of her charitable legacies from the proceeds, and to hand the balance of said proceeds to B. to use as he saw fit. C. sold the loan, receiving in payment therefor a check drawn to B.’s order, which he retained. A. died within a calendar month of the date of her will. Subsequently, her executor filing his account, the Orphans’ Court held that the intended disposition of the proceeds of the loan by A. was in contravention of the provisions of the Act of April 26th 1855, § 11, and accordingly surcharged said executor with the amount of said proceeds. Held, that A. had made a fully executed and completed gift of said loan or the proceeds thereof in her lifetime, which was not in contravention of said Act, and that therefore the above decree was erroneous.
    January 11th 1882.
    Before Sharswood, O. J., Merour, Gordon, Paxson, Trunkey, Sterrett and Green, JJ.
    Appeal from the Orphans’ Court of Philadelphia county : Of July Term 1881, No. 104.

    Appeal of Fredoi’ick McGlade, executor of the will of Mary B. Daly, deceased, and of Rev. James E. Mulholland, from decree of said court, in the matter of the account of said McGlade, as executor, surcharging him with the proceeds of certain securities sold during the testatrix’s last illness by her direction ; and refusing to award payment to Rev. James E. Mulholland of the sum of $100, bequeathed to him by said testatrix “ for masses.”
    The facts were as follows : — On Saturday, November 29th 1879, Mary B. Daly, being then ill, sent for her friend Frederick McGlade, and gave him instructions for her will, which he drew accordingly, and which she signed the same day, and delivered to Rev. James E. Mulholland, for safe keeping. By this will she bequeathed (1) sundry legacies to individual relatives and friends; (2) certain bequests to charities and religious persons, .including a bequest “ to Rev. James E. Mulholland, of St. Patrick’s church, for masses, $100.(3) all the residue of her ■estate to Archbishop James F. Wood, to be by him, at his discretion, used for charitable purposes. She ajjpointed Frederick McGlade her executor.
    On the following Monday McGlade again called to see Mrs. Daly, and, finding her very ill, he said to her that if she should die within thirty days from the date of her will, the bequests to charities would fail. This information caused her anxiety, and she asked what she should do. He replied, that the only way was to give the money away herself before she died. This suggestion met her approval, and, by her direction, McGrlade brought a magistrate, before whom Mrs. Daly executed, under seal, a power of attorney in blank, authorizing the sale and transfer of $2,400 of Philadelphia City Loan owned by her, and standing in her name. She then sent the eertifiates of said loan, with the power of attorney, to the Eev. Mr. Mulholland, and requested him to sell the same, and hand over the proceeds to Archbishop Wood, to be by him distributed among the several charities in the amounts of the bequests to them contained in her will, and to do with the balanceas he deemed proper. Eev. Mr. Mulholland accordingly sold the loan through Messrs. Drexel & Co., brokers, who, at his request, gave him their check to the order of Archbishop Wood, for the proceeds, $2,718, dated December 9th 1879. Archbishop Wood did not, however, receive or indorse the check, which remained in the hands of Eev. Mr. Mulholland, and the money remained in the hands of Messrs. Drexel & Co.
    . Mrs. Daly died December 20th 1879, less than one month after the date of her will.
    Upon the filing of the executor’s account, it appeared that the testatrix’s estate was insufficient to pay all the legacies in full. Counsel for certain legatees (other than charities) claimed that the testatrix having died within one month of the date of her will, the bequests to the charities were void, and that the attempted gift to them by the testatrix in her lifetime was also void; whereby it became the duty of the executor to claim and collect the proceeds of said city loan sold by direction of testatrix, and apply the same to the payment in full of said legacies to private beneficiaries, and any balance that might remain to the next of kin. He therefore asked that the executor be surcharged, for the purpose of distribution, with the amount of the proceeds of said city loan, $2,718.
    The auditing judge (Hanna, P. J.) sustained the claim, and, in his adjudication, held as follows1“ There can be no doubt as to the invalidity of the bequests to £ religious or charitable uses,’ contained in the will of testatrix, she having died within one calendar month after its execution: Act of April 20th 1855. But the question now presented is, whether a disposition by way of gift, with intent to evade the statute, made within thirty days prior to the death of the testatrix, is contemplated by the Act of Assembly, and also void.
    ££ The Act provides that£ no estate, real or personal, shall hereafter be bequeathed, devised or conveyed to any body politic, or to any person in trust for religions or cliaritable uses, except the same be done by deed or will, attested by two credible and at the time disinterested witnesses, at least one calendar month before the decease of the testator or alienor; and all dispositions of property, contrary hereto, shall be void and go to the residuary legatee or devisee, next of kin, or heir according to law; Provided, That any disposition of property within said period, bona fide, made for a fair valuable consideration, shall not be hereby avoided.’
    “ Under the evidence it cannot be denied that testatrix, by the delivery of the certificate of city loan to the Nev. James E. Mulholland, with instructions to sell the same, to the end that the proceeds should be, by him or Archbishop "Wood, distributed and paid to the religious and charitable purposes contemplated and mentioned in her will, intended, if possible, to prevent the loss to these charities and religious institutions, which she well knew would ensue in the event of her death within thirty days after the execution of her will. But, however laudable the motive, her benevolent wishes and intentions cannot be carried out, and express provisions of the law disobeyed. As was said by Lewis, C. J., in Erice v. Maxwell, 4 Casey 34, ‘ There may be some difference of opinion on the question of policy involved in its enactment, but there can be no doubt that it is our duty to carry out its provisions in good faith.’ Here there was not only a gift of personal property, but upon the express trust that it was to be sold and the moneys realized, paid and distributed as gifts or donations for ‘religious or charitable uses.’
    It was not, as in the case of Shultz’s Appeal, 2 W. N. C. 309, where there was an absolute bequest to a legatee, with the design by testator that it should be devoted to charities, and although the testator died within the thirty days, yet, as the legatee had no knowledge of the wishes and intentions of testator until after his death, the bequest was held good, and not avoided by the statute. In this case, the Nev. Mr. Mulholland, himself a legatee, accepted the trust imposed by testatrix, and with full knowledge of the purpose of testatrix in delivering to him the certificate of city loan. The Act of 1855 is clear and explicit. It applies to real and personal estate, and prohibits a bequest, devise, or conveyance of either to a corporation or any person in trust for religious or charitable uses, except the same be done by deed or will, at least one month before the death of the testator or alienor. That in this manner only, can such a bequest or conveyance be made, is evidenced further by the fact that ‘ all disposition of property contrary hereto shall be void.’ This, of course, means any disposition other than by deed or will executed as the law prescribes.

      “ In view of tlie facts presented by the testimony, the auditing judge is of the opinion that the attempted gift by the testatrix was contrary to the provisions of the Act of 1855, and therefore invalid. Both the Rev. Mr. Mulholland, and the Archbishop have acted with wise discretion in declining to receive and disburse the amount realized by the sale of the city loan.
    “ The amount in the custody of the bankers being therefore assets of decedent’s estate, the accountants should at once collect the same, and, for the purpose of distribution according to law, be surcharged therewith as hereafter appears. Under the Act of i 855 the void legacies would go to the residuary legatee. But as the bequest of the residue of the estate, being for charitable purposes is also invalid, the entire residue of the estate must go to the next of kin or heirs of the testatrix, according to the intestate law. And the above balance is accordingly so awarded, and directed to be paid by the executor.”
    To this finding of the auditing judge exceptions were filed by the executor, and on behalf of the charities who were beneficiaries, which exceptions the court, after argument, dismissed, Penrose, J., filing the following opinion :■—
    “ If the gift here had been of money or other property passing by mere delivery, there would be room to argue that it did not fall within the terms of the Act of 1855. But it was not; what was given was a certificate of city loan, which could not be transferred except by writing, and a power of attorney was sealed and delivered by the donor to accomplish this purpose. It v/as given to the spiritual adviser of the decedent in trust for certain religious or charitable uses, with the avowed purpose of preventing a failure of the gift in the event of her death within thirty days.

      “ This may, with entire propriety of language, be called a conveyance, and the case is as clearly within the letter as it is within the spirit and reason of the statute.
    “ Bearing in mind the mischief designed to be remedied, our astuteness should not be exercised in finding means by which to defeat the operation of the Act; on the contrary, we should follow the course so highly commended by Lord Coke in his comparison of ancient and modem readings, and strive to ‘ suppress subtile intentions to creep out of the statute.’
    “ Exceptions dismissed, and adjudication confirmed.”
    Frederick McGlade, executor, and Rev. James E. Mulholland thereupon took this appeal, assigning for error, inter alia, the dismissing of their exceptions, and the decree of the court.

      B. F. Fisher, for the appellants. —
    The disposal of the city loan by Mrs. Daly, was an executed gift inter vivos. The certificates were actually sold, and the money received. The check for the proceeds was equivalent to the money. The title passed; the donor could not have recovered back the gift, nor can her executor after her death. The Act of 1855 does not, by its terms, and was not intended to, apply to the disposal of personal property during life. The act prohibits only bequests of personalty, and devises or conveyances of realty to charitable uses, unless the same be “ by deed or will, ... at least one calendar month before the decease of testator or alienor.” Under the construction adopted by the court below, all gifts to charities unaccompanied by a deed attested by two credible and disinterested witnesses, would be void, and executors would be chargeable therewith.
    The statute does not contemplate interfering with the rights of ownership in personal property which passes by delivery. The fact that Mrs. Daly became her own almoner with intent to evade the statute cannot defeat her executed gift, which had no taint of illegality about it.
    The gift to the appellant, Mulholland, was a personal one, and not for a charitable or religious use. It was in compensation for his outward services in saying masses, — not for the masses as such — just as a fee is paid to a clergyman for his service in performing a marriage ceremony. The case is distinguishable from Rhymer’s Appeal, 8 W. N. C. 266, where the money was given to a chureh “ to be expended in masses,” and not to a legatee for services performed by him. The executor should not, therefore, have been surcharged with that gift.

      E. B. Worrell, for the appellees,
    relied on the opinions of the court below, and contended that the act of the testatrix was a legal fraud upon the statute, she attempting deliberately to accomplish by indirection that which the statute directly prohibited.
   Mr. Justice Gordon

delivered the opinion of the court, January 23d 1882.

Had Mary B. Daly, the decedent, within one month, or, for that matter, within one day, before her death, handed over to the representative of any one or more of the charities mentioned in her will, any sum of money or piece of personal property, intending to pass it to it or them as an immediate gift, I suppose it would not be contended that such gift would come within the prohibition of the eleventh section of the Act of April 26th 1855. Such present donation, thus fully executed and completed during the life of the donor, cannot fairly be called either a bequest, devise or conveyance, within the meaning of the statute.

Following out, then, this thought, as the one upon which the case turns, our inquiry is naturally directed to the intention of this donor, and to that which she actually did. But to this inquiry the answer is straightforward and clear; about it there is neither obscurity nor ambiguity. She intended to make an immediate donation of a certain amount of money to the charities which she had already indicated. There was to be no intervening trust about it, excepting only so far as she must of necessity, in consequence of her sickness, have an intervening hand to pay it over. That she had to execute a power of attorney on her city bond, in order to raise the money, is of no kind of consequence. Had she, when in sound health, sold this bond, or for that matter, her real estate, if any she had, and of the money so raised made her intended donations, will any one pretend to say that, had she died within thirty days after the execution of such donations her beneficiaries would have bad to repay the moneys thus given to them ? Yet this is substantially what we have in the case as now presented to us. The testatrix, being unable to attend to her qwn business, ordered her city bond to be handed to the Rev. Mr. Mulholland, to he by him sold, at the same time directing the proceeds to he passed to Archbishop Wood for distribution, before her death, among the charities indicated. Accordingly, Mr. Mulholland did effect a sale of the bond, through Drexel & Co., and passed the proceeds to the Archbishop in the shape of Drexel & Co.’s check, to his, the Archbishop’s, order. All this was done under the direction of the donor and in her lifetime. The check was dated December 9th 1879, and she died on the 20th of the same month.

Now then, the question is, how do these donees take? — By what title do they hold the moneys intended for their use ?— Under a bequest, devise or conveyance ? — No, under neither; hut by virtue of a gift fully executed in the donor’s lifetime.

Such then being the conclusion to which the facts of the case bring us, if nevertheless, the case is within our Act of 1855, as the court below seemed to think, the result is just this, there is a period of one calendar month in every person’s life, in which, by no possibility, can such person make a present, executed gift of any part of his or her money, or other personal assets, to a religious use or other charity. To a doctrine such as this we cannot assent. Were we in doubt as to the intent of the statute we would, nevertheless, incline to that construction of it which would impinge the least on the right of persons so to dispose of their own property as to them may seem proper. We are not among those persons who regard this act as of doubtful utility; on the other hand we esteem it of great public value, and are, therefore, the less disposed so to construe it as to make it the object of public odium.

The decree of the court below, as to the surcharge of $2718, proceeds of sale of city loan, is now reversed and set aside, and as to the balance of the account a redistribution is ordered. The costs of this appeal to be paid by the appellees.


author: Chief Justice Sharswood

text:
    People’s Bank versus Kurtz.
    1. It is well settled that a party selling as his own personal property of which he is in possession, warrants the title to the thing sold, and that if, by reason of defect of title, nothing passes, the purchaser may recover back his money, though there be no fraud or warranty on the part of the vendor. This principle applies as well to dioses in action as to any other description of personal property.
    2. The vendor of a share of stock impliedly warrants that the same is issued by the duly constituted officers of the company and is sealed with the genuine seal of the corporation. He does not, however, impliedly warrant that such share has not been fraudulently issued by the officers in excess of the charter limit. If this prove to be the case, the vendee lias no recourse against him.
    3. Dubitatur, whether in such case the corporation is bound to permit a transfer on its books and to deliver a new certificate to the bcna fide vendee. It may be that it is not obliged so to do.
    4. Semble, that the bona fide holder of a fraudulent over-issued certificate in such case would have a right of action against the corporation, and that his measure of damages would be the market value of the stock at the time a transfer thereof was demanded by him.
    January 11th and 12th 1882.
    Before Siiarswood, C. J., Merour, Gordon, Paxson, Trunkey, Sterrett and Green, JJ.
    Error to the Court of Common Pleas No. 2, of Philadelphia cownty: Of January Term 1881, No. 205.
    Case stated, by the People’s Bank of Philadelphia against William W. Kurtz, trading as W. W. Kurtz & Co., showing the following facts :— *
    In April, 1875, the People’s Bank purchased from the defendant, who was a note-broker, three promissory notes in the following form:—
    “ $5,000. Philadelphia, April 12th 1875.
    “ Four months after date, we promise to pay to the order of S. Gross Fry, five thousaud dollars, without defalcation, for value received, having deposited herewith Ctf. No. 515, for eight hundred shares Philadelphia and Darby Railroad stock, as collateral security, which we authorize the holder of this note, upon the non-performance of this promise at maturity, to sell either at the Brokers’ Board, or at public or private sale, without demanding payment of this note, or the debt due thereon, and without further notice, and apply proceeds, or as much thereof as may be necessary, to the payment of this note and all necessary -expenses and charges, holding ourselves responsible for any deficiency.
    “(7416) (Signed) Emaus Iron Co.,
    “ Per S. Gross Fry, President.

    “ Payable at
    “ Due August 12-15th 1875.
    (Indorsed) “ S. Gross Fry.”
    The other two notes, dated April 10th and 13th, at four months, were for $6,250, and 85,000, respectively.
    The three certificates of the stock of the Philadelphia and Darby Ilailroad Company, mentioned in the notes pledged as collateral security, stood in the name of W. ~W. Kurtz & Co. and were delivered with the notes to the plaintiffs, accompanied with blank powers of attorney to transfer the same, duly executed by W. W. Kurtz & Co. '
    Said notes were protested for non-payment at maturity.
    At the time of making the said sales, the defendant was carrying on business as a note-broker, and buying and selling bills and notes on his own account, and he was on this occasion acting as the broker of S. Gross Fry, but this fact was not disclosed or known to the plaintiff at the time of the purchase, who dealt with him as a principal.
    At the time of the sale of the said notes, the Emaus Iron Company and S. Gross Fry were in good credit, and the market value of the Darby Ilailroad stock was about eight dollars per share.
    All of said certificates were fraudulently issued by the officers of the said railroad company, and constituted part of an over-issue in excess of the limit allowed by the charter. The certificates were in the usual form, and regular on their face, and -were issued by the duly constituted officers of the company, and were sealed with the genuine seal of the corporation.
    After the discovery of the over-issue of the stock, which was about May 15th 1875, the market value of the stock fell to less than three dollars per share, which fact was known to both parties.
    On the 14-th, 16th and 20th days of August, 1875 the plaintiff tendered to the defendant, the notes with the collaterals, the stock heretofore spoken of, and demanded repayment of the money paid for said notes, which demand was refused, and plaintiff also made a subsequent tender some months afterwards, not later than December 4th 1875, of notes, protests and collateral.
    On December 20th 1877, the plaintiff filed a bill in equity in the court of Common Pleas, No. 4, December Term 1877, No. 398, as the holder and owner of said stock, and obtained a decree subsequently against the said company for damages at $2.85 per share.
    The said S. Gross Fry, at the time of these transactions and for a long time previous, was president of the Philadelphia and Darby Railroad Company, and of the Emaus Iron Company. He continued to be president of the company up to the time of the discovery of these transactions, about May 15th 1875.
    On June 8th 1877, the plaintiff received from the assigned estate of the Emaus Iron Company $1,679.75, and on July 5th 1878, from the assigned estate of S. Gross Fry $257.33, the said Fry and the Emaus Iron Company being insolvent at the time of the maturity of these notes.
    If, upon these facts, the court shall be of the opinion that plaintiff was entitled to tender back the notes, then judgment to be entered for the plaintiff for $18,783.51, with interest from November 12th 1880, and costs (plaintiff to assign to the defendant all claim upon notes and stock), otherwise judgment for the defendant. Either party to be entitled to a writ of error.
    The court entered judgment upon the ease stated for the defendant. No opinion was filed. The plaintiff thereupon took this writ of error, assigning for error the entry of the said judgment.

      Hood Gilpin and F. G. Brewster (Charles Gilpin with them), for the plaintiff in error. —
    The plaintiff’s claim to recover rests upon three grounds:—
    1. Upon the warranty of the genuineness of the certificates. Where a man sells personal property, he warrants two things, (a) that the thing sold is of the same generic character as what he undertook to sell; in other words, that it is really what it purports to be; and (b) that he had title to it. So with dioses in action. If a man agrees to sell a promissory note of John Smith, his agreement is not satisfied by giving a piece of paper with the genuine signature .of John Smith, but which is not a promissory note. The defendant here undertook to give us “ shares of the capital stock of the Philadelphia and Darby Railroad Company.” That agreement was not satisfied by giving us fraudulently over-issued stock, which, though signed with the genuine signatures of the officers, was not stock' at all, but a sham; and it is no answer to say, the sham gives you a right of action against the maker of the sham. The defendant has our money, but we have not the capital stock. We have a right to say, take back your sham and give ns our money, or else respond in damages: Flynn v. Allen, 7 P. F. Smith 485; Lyons v. Divelbis, 10 Harris 185; Frazer v. DMuvilliers, 2 Barr 200; Oharnley v. Dulles, 3 W. & S, 853; Corn Exchange Bank v. Bank of Republic, 28 P. F. Smith 233: Chambers v. Bank, 28 P. F. Smith 205 ; Tradesmen’s Bank v. Third National Bank, 16 P. F. Smith 435. As to our right of action, founded upon the warranty, no rescission, demand and tender were necessary before bringing suit: Flynn v. Allen, supra ; Hook v. Robison, Addison 271; Ritchie v. Summers, 3 Yeates 531.
    2. The plaintiff is entitled to recover from the defendant as upon a failure of consideration and a rescission of the contract. The right to rescind was exercised within a reasonable time, viz., at the day of maturity of each note. We could not rescind before maturity, as we could not tell that the notes would not be paid. When we did rescind, the relations between Kurtz and Fry had not changed. We did not waive our right to rescind by suing the railroad company. Although the fact of over-issue of stock was then known, no one could tell whether the stock he held was genuine or fraudulent, and we, in common with others, joined in suits against the company to ascertain that fact, and to recover what could be saved out of the general wreck, for the benefit of whom it might concern.
    3. In either view, the defendant is liable as the agent of an undisclosed principal — who was dealt with as a principal.

      Samuel Dickson and li. G. MoMurtrie, for the defendant in error. —
    In the case of a sale of a certificate of stock, the seller ’warrants that he is the owner of the certificate, and that it is a genuine instrument. The fallacy of the argument of the plaintiff in error rests on the significance which he attributes to the word “ genuine,” as applied to certificates of stock. It really means that the instrument is genuine only in the sense that the corporation is bound by it. The plaintiff in error contends that the seller warrants that the contract evidenced by it is a genuine, i. e., a lawful and honest contract of the corporation, and that the corporation has dono no act to affect its value. The implied warranty of title and of genuineness, if traced to its origin, will be found to rest on the presumption of superior knowledge on the part of the seller, but where both parties have equal opportunities for knowledge, or where it is impassible for the seller to acquire knowledge, the warranty ceases to apply. Such is the case here. The sellers warranted the liability of the corporation upon the certificate, not that its real value, based upon the assets of the corporation, was and should remain equal to the market value, on the basis of which it was pledged. The plaintiff’s title, as against the corporation, was affirmed in their suit against the corporation, wherein they recovered the actual value of the stock, which was the same as the actual value of the authorized stbck. The holders of the authorized and the unauthorized stock participated equally in the assets. To hold that the plaintiffs may also recover against their vendor, on the ground that the stock was unauthorized, would put them in a better position than if they had obtained authorized stock: Benjamin on Sales (2d ed.) 516, § 641; Iloe-u. Sanborn, 21N. Y. 552-55 ; Miller v. Pitch, 7 W. & S. 366; Parsons on Contracts 596 ; McCoy v. Artcher, 3 Barb. (S. C.) 323 ; "Wood’s Appeal, 11 Norris 379 ; Willis v. Philadelphia and Darby Railroad Co., 6 W. N. C. 461; Railroad Co. v. Schuyler, 34 N. Y. 30; Bank of Kentucky v. Schuylkill Bank, 1 Pars. Ed. Cas. 180. Plynn v. Allen, relied on by the other side, does not apply, as the obligor in the bond there was not bound at all. This ease is analogous to the sale of a bogus mortgage, genuine as to the execution, but purporting to cover land which has no existence, or to which the mortgagor has no title. The seller does not warrant the existence of the land or the title. Or to the case of a warehouse receipt; the seller does not warrant the existence of the goods in the warehouse, or that it is not a duplicate. Or to the case of a note, signed by an infant ; or to a bond by a woman secretly married ; or to a railway mortgage bond, where the mortgage is not in existence, or is invalid. Or to the case of a national bank note, the transferor of which does not warrant that the full amount of reserve has been deposited by the bank in the U. S. Treasury. Or to the case of a sale of stock in a corporation, which is subsequently dissolved upon quo warranto by the Commonwealth for causes happening previously, as for defects in organization, etc.
    The plaintiff’s offer of rescission came too late. It is unreasonable to hold that a broker, who allows the stock to be put in his name, and has the certificate in his possession only long enough to make a sale, should remain indefinitely liable to a purchaser who failed to demand a transfer to 1ns own name : Benjamin on Sales, 415, 452; Roth v. Crissy, 6 Casey 145 ; Summers v. Ritchie, lb. 147, note; Rick v. Kelly, lb. 527.
   Chief Justice Sharswood

delivered the opinion of the Court, January 23d 1882.

It was held at first that in an action on the case for deceit against a party who had sold a personal chattel to the plaintiff, to which he had no title, that it was necessary to aver a scienter: Dale’s Case, Cro. Eliz. 44; Roswel v. Vaughan, Cro. Jac. 196. But this doctrine was subsequently exploded, and an averment of possession considered sufficient, as the vendor must be intended cognizant of his own title, the sale being necessarily an affirmation of title. Cross v. Gardner, Carth. 90; Medina v. Stoughton, 1 Ld. Raym. 593. It may now be regarded as well settled, that a party selling as Ids own, personal property of which he is in possession, warrants the title to the thing sold; and that, if by reason of defect of title, nothing passes, the purchaser rnay' recover back his money, though there be no fraud or warranty on the part of the vendor. This doctrine is held to apply to dioses in action as well as other descriptions of personal property: Charnley v. Dulles, 8 W. & S. 353.

Shares of stock in a corporation are choses in action, giving a right to dividends and an interest in the capital. The certificate is the evidence of such ownership, and there can be no doubt that if the certificate is forged, or the holder is not such bona fide, so that ho lias no claim on the corporation, the vendor would be liable to his vendee on the implied warranty of title. His possession of the certificate would be as to his vendee possession of the stock, just as possession of a bond or note is possession of the debt which they represent. Where, however, there has been a fraudulent over-issue of stock, evidenced by certificate under the genuine seal of the corporation, the case presented is somewhat different. It has been settled, that a corporation is liable to bona fide holders of such fraudulent certificates, because, like individuals, they are responsible for the fraudulent exercise of the power intrusted by them to their officers or agents. It is unnecessary, in this case, to consider whether they are bound to permit a transfer on their books and to deliver a new certificate to the bona fide vendee. It may be that when the over-issue is in excess of the amount authorized by the charter, they would not be. But it seems to be established, upon principle as well as authority, that the bona fide holder of such a fraudulent- certificate would have a right of action against the corporation, and that his measure of damages would be the market value of his stock at the time the transfer was demanded: Willis v. Philadelphia & Darby R. R. Co., 6 W. N. C. 461, and eases cited in the opinion of Judge Hare. The vendor of such a certificate has then a title which ho can transfer, and a remedy against the corporation. Suppose the shares in the case before us had been transferred by an original subscriber, his vendee would have been in the same position as the assignee of shares subsequently issued in excess of the charter. He would have had a clear right to demand a transfer and new certificate. Such certificate, however, would liave been worth to him only the value of the stock in the market at the time. If his transfer had been refused, he would be entitled to the same remedy and the same measure of damages. The vendor of shares of stock certainly does not warrant the solvency of the corporation. Corporations are especially liable to be made insolvent by the embezzlement and fraud of tbeir agents or officers. It matters not whether the loss arises from robbery or embezzlement, or by the fraudulent issue of stock, the value of the stock is depreciated. It matters not whether such fraud or robbery was before or after the sale of the stock, the bona fide vendor cannot, under the rule in question, be held responsible for the depreciation in value. It is one of the risks yvhich are assumed by all dealers in such securities. It is agreed in the case stated, that “the certificates were in the usual form, and regular od their face, and were issued by the duly constituted officers of the company, and were sealed with the genuine seal of the corporation.” We are of opinion that the implied warranty of title extended no further, and that there was no breach.

Judgment affirmed.