author: Mr. Justice Stemustt

text:
    Schaffer versus Mutual Fire Ins. Co.
    1. A contract of insurance with a mutual insurance company is not binding until the liability of the insured to contribute to losses is fixed.
    2. The by-law's of a mutual insurance company required that the policy should be signed by the insured, and that certain premiums and fees should be prepaid. The agent of the plaintiff went to the office of the company to effect an insurance of certain property of plaintiff and stated that he would pay these premiums and fees when he received the policy. A policy was duly executed on the same day. except the signature of plaintiff, and the latter was enrolled as a member on the books of the company. On the day following the property was destroyed by fire. The agent of plaintiff, the next day tendered the premiums and demanded the policy, which the company refused. In an action against the company for the amount named in the policy. Held, that the contract of insurance was not completed and the court properly directed a nonsuit.
    March 4th 1879.
    Before Sharswood, C. J., Mercur,, Gordon, Woodward, Trunkey and Sterrett, JJ. Paxson, J., absent.
    Error to the Court of Common Pleas of Lehigh county: Of January Term 1879, No. 163.
    Debt by Thomas Schaffer against the Mutual Eire Insurance Company of Lehigh county, upon a policy of fire insurance.
    The facts were substantially these: On April 8th 1876, David Scheirer, as the agent of plaintiff, called upon John Koch, the secretary of the defendant, for the purpose of effecting an insurance upon a dwelling-house of the plaintiff. The secretary accepted the risk, and a policy for $1500 was duly -prepared, but remained .unsigned by the insured. The company is a mutual one, and each member is liable to assessment as often as a loss requires it. Upon taking out this policy, a premium of $1.65 was required to be paid as well as a fee of $1.95, the latter to defray the incidental expenses of insurance. These were not paid at the time, but as Scheirer had another policy upon other premises to be transferred, he said he would pay for them both at the same time. On the same day Schaffer was enrolled as a member upon the books of the company, and a memorandum made of the amount of the insurance, the premium, and that the policy was assigned to the Whitehall Loan and Building Association. On the next morning, April 9th 1876, the building, in the absence of the insured, was destroyed by fire. On April 10th 1876, Scheirer called upon Koch, and asked for the policy, which was handed to him. He then offered the premium and the fee of membership, but before the money was received, informed the secretary of the fire. The secretary then refused, to accept the payment or to deliver the policy. Scheirer then stated that he had effected the insurance on the Saturday previous, and that it was agreed that he should pay when he brought the other policy for transfer. Koch replied that he must now submit the matter to his company. On May 13th 1876, an endorsement, signed by Koch, was made on the policy in these words, “Not satisfied by the time of filling out the policy and burned, therefore not insured, and can-celled.” Schaffer’s name was also erased from the book of membership and a similar entry was there made. Schaffer testified that after the fire, in a conversation with Koch, the latter stated “it (the house) was insured, but now it is not, because it was burned off.”
    The following by-laws of the company were printed on the hack of the policy and were a part thereof:
    “ Art. 20. Every person, on application for membership, shall pay the authorized agent, one dollar and ninety-five cents, for defraying the incidental expenses of the company.”
    “ Art. 22. All policies issued by this company shall bear the company’s seal, to be signed by the president and the insured, and attested by the secretary.”
    The plaintiff made several offers to prove the custom of the company in effecting insurances without a pre-payment of the premium and the fee of membership, which, under objection, were refused by the court.
    The defendant then moved for a • nonsuit, which the court, Harvey, P. J., granted, and subsequently refused to take off, in an opinion, inter alia, saying:
    “ Corporations may contract by parol within the sphere of their proper functions: Hamilton v. Lycoming Mutual Insurance Co., 5 Barr 339; Insurance Co. v. Porter, 3 Grant 123. Insurances maybe effected without the issuing and delivery of policies, and it is well settled that after application for insurance has been approved, and payment of premiums made on account, the contract is complete without the execution of a policy : Goodall v. New England Insurance Co., 25 N. H. 169; Whitington v. Firemans’ Insurance Co., 29 Barb. 312. When insurance is thus complete, it is always to be regarded as made upon the terms, and subject to the conditions expressed in the ordinary forms of policies used by the company at the time: Eureka Insurance Co. v. Robinson, Rea & Co., 6 P. F. Smith 256. This was not questioned at the trial; we were asked by the defendants’ attorney to direct a compulsory nonsuit, solely upon the ground that a consummated contract of insurance had not been shown by the plaintiff. There is great uniformity of authority holding it to be error, to submit a question to the jury of which there is no evidence: Whitehill v. Wilson, 3 P. & W. 405; Elkins v. McKean, 29 P. F. Smith 493; Raby v. Cell, 4 Norris 82.
    “As we were convinced, after the close of the plaintiff’s evidence, that there was no evidence of a consummated contract of insurance, we directed a compulsorjr nonsuit. Were we in error? That is the only question for judicial solution. Ordinarily the acceptance of a proposal to insure for the premium offered is a completion of the negotiation: Halhrock v. Commercial Insurance Co., 2 Dutch. 268.
    “The applicant must have done all on his part that is required to be done before he can assert that the contract is consummated. And when payment is the consideration, that gives life to its contract, it must be shown: Marland et al. v. The Royal Insurance Co., 21 P. F. Smith 393. The corporation defendant Avas a mutual fire insurance company chartered January 14th 1874, Avithin the G-eneral Insurance Act of April 2d 1855, Pamph. L. 211. Its charter enabled it to insure in all kinds of buildings, merchandise and other property against loss by fire on the mutual principle exclusively, and it Avas provided that all persons insuring therein ‘shall be members thereof during the period they remain so insured and no longer.’
    “ It was required by the by-laws that any person on application for membership shall pay the authorized agent a stipulated fee for incidental expenses; that all policies shall be signed by the president and the insured; and that the charter and by-laAvs are a part of the contract of insurance. The plaintiff did not make a personal application for insurance; he sent David Scheirer, secretary of the building association, who Avas his creditor. In the conversation betAveen Scheirer and the secretary of the company nothing Avas said about the duration of the policy — hoAV much premium Avas to be paid — when the policy Avas to be signed by Schaffer. It Avas nowhere said by the secretary that the property Avas insured from that time on. I quote the following from the notes of testimony of Mr. Scheirer: ‘ I told him I wanted to get it insured right aAvay, as soon as possible, because the policy had expired.
    “ ‘Q. What did he say ? A. He looked on the policy and said they would take it.
    “ ‘ Q. When Avere you to pay the membership and the premium ? A. He had another policy in hand which was changed from Solomon Fenstermacher to the Building Association, and I told him he should make the policies all out — and make out a bill and I would pay him all at once as soon as I could fetch the policies, and then he said it Avas all right.’
    “ This was the main testimony relied on to prove a complete contract. If it is true that it Avas further shown that the policy was made out, entered on the policy record and was ready for the signature of Schaffer, no entry was made of premium paid — no premium was charged.
    “ This evidence is of little value, as are the admissions of Koch after the fire, if the proof of the contract itself is radically deficient. The question here arises did Schaffer become a member of the Mutual Fire Insurance Company of Lehigh county, by reason of what took place between Koch and Schaffer April 8th 187 6 ? Schaffer had neither paid nor agreed to pay any premium. What losses or expenses of the company was he liable for ? What action could have been maintained against him upon what transpired between Koch and Scheirer ? None. He had entei'ed into no contract to pay anything. He had merely made an application that required a payment of premium to constitute him a member of the company. The by-laws contemplate an application and the payment of a fee not only by those whose application is accepted but by all applicants. Their applications must be accepted. The fee paid is not the premium required to be paid; that is paid when the policy is ready to be signed by the insured and delivered. The policies are executed in duplicates — one is given to the assured and the other retained by the insurer.
    “Where then, it may be asked, was there any evidence in the cause of the aggregatio mentium which is essential in the completion of any contract. Scheirer held a policy in this company and is presumed to have known the requirements of the charter and by-laws. He must have known that a contract could not be binding on the company, and not binding on Schaffer — could not he a contract to insure the safety of Schaffer’s property and no contract to render Schaffer liable for lossds falling within this class. He did not ask if the property was insured from that time on; but he wanted it insured right away, as soon as possible.
    “ The fact that he had not the money to pay the premium is very persuasive evidence that he did not approach the office of the company intending to effect a binding insurance upon that day. The payment of this premium was the condition precedent to the insurance. He did not ask the secretary to waive it, but contented himself in saying he would pay when he took the policy. In Mar-land v. The Royal Insurance Co., supra, it appeared that some question was asked about payment of the premium when the person asking was assured that he was safe without paying then. It was held that this was no excuse for the non-payment, Mr. Justice Agnew says: ‘The true-and easy explanation is, that they did not expect that a fire would take place so speedily and thought they would have time enough to close this business.’ These words are peculiarly applicable to this case. Schaffer must have known that he was not a member of the company for he neither paid, offered to pay nor authorized any one to pay one cent to that company on April 8th 1876. No policy was held in trust for him. He could not have understood that he was entitled, as a matter of right, to the undelivered policy. It was because of this want of mutuality in the alleged contract as set up by the plaintiff that the court directed a nonsuit; what was done was inchoate and not complete; it needed the payment of the consideration to vitalize the contract. Viewing the alleged contract in this light we attach no importance to what the secretary did and said after April 8th 1876. So that the application would grow into a consummated contract it was necessary to have a policy, to enrol it on the record of the company and to present it for the signature of the assured. When Koch said Schaffer was insured but now that there was a fire he was not injured, merely meant that if no fire had occurred he would have paid the premium according to and concluded the contract. This evidence gave to what was said between Koch and Scheirer no greater force than the words employed at that meeting. If they failed to consummate the contract no act of Koch subsequently done could operate to consummate it. Payment of the premium was required of Schaffer to constitute him a member.
    “ This conclusion is regretfully reached. Insurance companies should be held to a very strict rule of accountability. The tendency of these companies to invoke legal technicalities to escape liability .should not be encouraged by the courts. But while this rule may produce salutary results and may give stability to this class of contracts, it does not follow that insurance companies can have no legal defence to a suit upon a policy. When one is made to appear, it is the duty of the court to see that it be sustained. Any other course would be unjust. We have been forced to the conclusion that there is no merit fh the plaintiff’s contention, and that he has offered no evidence -which, under the rules of law, as we understand them, entitles him to a verdict.”
    Plaintiff took this writ, assigning for error the rejection of the offers of testimony and the refusal to take off the nonsuit.

      W. S. Sowden and A. B. Longaker, for plaintiff in error.—
    The facts show a contract to insure, and warrant the conclusion that the contract was consummated. Does an insured offer to pay when no contract is made ? Does the insurer execute a policy and enrol a member without such contract ? Or cancel a policy and erase an enrolled membership, if no insurance was effected ? This case is alike in principle with that of Bodine et al. v. Exchange Fire Ins. Co., 51 N. Y. 117. In the case at bar and that of Bodine there was a waiver of pre-payment, and the agreement of insurance was made in both cases on the understanding that the fees should be paid on a subsequent day. But in the New York case there was a clause in the policy containing a condition that “ no insurance should be binding until premium was paid.” In the case at bar there was no such condition anywhere. In the former case, there was a motion for a nonsuit, on the ground that the evidence was insufficient; the motion was denied, and on exception taken by defendant the decision was affirmed. The court below charged that if the company, through their agent, so conducted the transaction that Bodine believed himself to be insured, they were liable; that the agent had a right to waive pre-payment and trust the plaintiff for the premium. An agent can waive the pre-payment of the premiums and bind the company: Bodine et al. v. Exchange Fire Ins. Co., supra; Hotchkiss v. Germania Ins. Co., 5 Hun. 90; Farmers’ Ins. Co. v. Taylor, 23 P. F. Smith 354; Sheldon et al. v. Atlantic Fire and Marine Ins. Co., 26 N. Y. 460.

      Q. J. Mrdman and JEvan Holl'en, for defendant in error.
    Payment of the premium and the fees and the applicant’s signature to the policy were conditions precedent, and a failure to comply with any of them avoided the policy. The agent of the plaintiff had neither authority nor money to perform these conditions. ■ See Maryland v. Ins. Co., 21 P. F. Smith 393. There was no evidence from which a waiver by Koch could be inferred, nor was it within the scope of his authority.
   Mr. Justice Stemustt

delivered the opinion of the court, May 5th 1879.

The company defendant in error was incorporated under the Act of 1856, “for the purpose of insuring all kinds of buildings, merchandise and other property against loss by fire on the mutual principle exclusively.” Mutuality of obligation is of course the very essence of the principle. While the company, on the one hand, undertakes to pay or make good the losses, the insured, on the other, agrees to contribute his proportionate share of current expenses and losses happening during the life of his policy. Their respective promises are mutually dependent upon each other. The undertaking of the one is the only consideration for that of the other. It would be unreasonable therefore to contend that there could be any liability on the part of the company to the insured for the loss of his property, unless he at the same time had paid or assumed to pay his proportionate share of expenses and the losses sustained by other members. The principle upon which the system of mutual insurance rests is utterly inconsistent with any such proposition. The plaintiff in error had neither paid nor agreed to pay any premium or fees, nor had he in any manner assumed the payment of his share of expenses and losses. In fact he had entered into no contract whatever. There was nothing on which the company could have sustained an action against him on an assessment to pay losses, or anything else. At most, he had merely made application, not in person, but through Scheirer, for insurance and membership in the company, without as yet having complied with any of the pre-requisites of membership. The charter and by-laws form an essential part of the contract of insurance, and these require the payment of a stipulated amount to defray incidental expenses. They also provide that all policies shall be issued in duplicate and be signed by the insured as well as by the president of the company. Soheirer was not furnished with funds to pay the premium and fees, nor had he any authority to sign Schaffer’s name, or in any manner bind him to discharge the obligations of membership, nor did he undertake to do so. At most, the evidence shows that there was a proposition to insure, which the company was ready and willing to accept, and all that was wanting to consummate the contract was the payment of the money by the plaintiff in error a,nd his signature to the policy, both of which were essential and neither of which was waived. Perhaps the secretary might have agreed to postpone the payment of the premium and fees, but there is no sufficient evidence that he did; nor does it appear that he had any authority whatever to dispense with the signing of the policy by the insured. The substance of Scheirer’s testimony is that he had another policy to be transferred uto the building association; that he requested the secretary to prepare both policies, make out a bill of amount to be paid, and he Avould pay it when he called for the policies. There is nothing in the testimony that Avould have justified the jury in finding that at the time of the fire there Avas any contract to insure, and if the fire had not occurred, no such thing Avould have been claimed. The .correct and natural explanation is that they did not anticipate that a fire would take place so soon-, and thought they would have ample time to close the transaction. While the negotiation Avas thus pending, the property was destroyed, and the company, as it had the right to do, refused to deliver the policy and assume payment of the loss. The questions involved are so fully and ably discussed by the learned president of the Common Pleas, in his opinion refusing to take off the nonsuit, that it is unnecessary to add anything to AYhat he has so Avell said.

The assignments of error are not sustained, and the judgment is therefore affirmed.


source: Caselaw Access Project

author: Mr. Justice Gordon

license: Public Domain

text:
    Wagner’s Appeal.
    A petition to the Orphans’ Court for the sale of land was in its terms plainly within the Act of March 29th 1833, but contained a recital that the petitioners were “ desirous that the land be sold, so as to bar any estate or remainder therein * * * so that the purchaser will take an indefeasible title thereto.” It was contended that this recital brought the case within the 5th section of the Act of April 18th 1853, and the proceeds of the sale retained their character as realty. Held, that as there were no contingent remainders or entails, such as are contemplated by the Act of 1853, the words in the above recital should be treated as mere surplusage, and a con-, version took place.
    March 4th 1879.
    Before Sharswood, 0- J-, Mercur, Gordon, Woodward, Trunkey and Sterrett, JJ. • Paxson, J., absent.
    Appeal from the Orphans’ Court of Berks county: Of January Term 1879, No. 223.
    This was a citation on the petition of George F. Baer, administrator d. b. n. c. t. a. of Henry M. Albright, deceased, to Harriet Wagner and Henry Brobst, surviving administrators of Franklin V. Wagner, deceased, to show cause why they should not be required to pay to the petitioner one-half of $2433.33, and one-half of $9598.50, proceeds of real estate sold by order of the Orphans’ Court of Berks county.
    The petition sets forth, inter alia, that on the 17th of-September 1853, Maria Catharine Wagner died unmarried, without issue, and leaving as her heirs, her mother, .Mrs. Catharine Wagner, her brother Franklin V. Wagner, and a niece, Valeria Catharine Al-bright, a minor child of a deceased sister intermarried with Henry M. Albright; that said Maria Catharine Wagner died seised of an undivided third part of a messuage and lot of ground in the city of Beading, and also of an undivided third part of a tract of land and tavern-stand situate in Upper Bern township, Berks county; that upon the death of Maria Catharine Wagner, her mother Catharine Wagner took a life-estate in the said properties, with remainder in fee to Franklin V. Wagner and Valeria Catharine Albright aforesaid.
    That on the' 25th day of April 1856, Mrs. Catharine Wagner presented a petition to the Orphans’ Court of said county, setting forth, inter alia, that she held a life-estate in the third part of the property in the city of Beading; that it was for the interest of the said Franklin V. Wagner and Valéria Catharine Albright that the same should be sold, and praying the appointment of a trustee to sell the said property under the Act of April 3d 1851, Pamph. L. 305; whereupon the court appointed Franklin V. Wagner as such trustee, .who sold the same for $2433.33, and held the same in trust for the parties interested.
    That on the 21st of September 1865, Franklin V. Wagner, as the guardian of Valeria Catharine Albright, and representing all the parties in interest, presented a petition to said court, setting forth that the rents of the property in Upper Bern township were insufficient to keep the same in repair and be productive of revenue to those interested; that the buildings were in a state of dilapidation ; that it would be to the advantage of the parties interested to sell the same and re-invest the proceeds for their use ; that he was desirous for himself and his ward that the property should be sold, so as to bar any estate or remainder, and give the purchaser a clear and indefeasible title; whereupon the court ordered the sale as prayed for, and that it was sold for $9598.50; that on the 24th of February 1866, the said Franklin V. Wagner was appointed trustee to invest the said sum and pay the interest to Mrs. Catharine Wagner during her life, and upon her death to divide the principal equally between himself and the said Valeria Catharine Albright.
    The petition further sets forth that on the 10th of May 1866, the said Valeria Catharine Albright died, a minor, unmarried and without issue, leaving her father, the said Henry M. Albright, her sole heir ; that on the 1st of September 1865, the said Franklin V. Wagner died, and the said Harriet Wagner and Henry Brohst were appointed and are still acting as his administrators ; and that on the 7th of March 1868, the said Henry M. Albright died, the said George F. Baer becoming his administrator d. b. n. c. t. a., and that on the 7th of February 1875, the said Mrs. Catharine Wagner also died; whereupon the one-half of the aforesaid sums became due and payable to the legal heirs of the said Valeria Catharine Albright, whom the petition represents; and that the same have not yet been paid by the administrators of said Franklin V. Wagner, deceased. The petition therefore prays for a citation to show cause why they should not be required to pay the said sums of money to said petitioners.
    The answer sets forth:
    1. That the real estate, one-half of the proceeds of which is claimed by the petitioners, wras devised to said Maria Catharine Wagner by the will of her father Valentine Wagner.
    2. That the proceedings to convert the said real estate into money was commenced for a specific purpose, and not for the purpose of converting it into money; that the sale did not work a conversion of the estate into personalty during the life of the widow, during which it remained realty, and that as Valeria Albright died May 10th 1866, the funds, for all purposes of descent, remained real estate and descended accordingly, and
    3. That Henry M. Albright is not in the present case the heir at law of the said Valeria Albright, not being of the blood of the first purchaser, and is not entitled to inherit the same, and praying ■that the petition be dismissed with costs.
    The question in dispute was argued on the petition and answer, including a reference to the original proceedings under which the several sales were made.
    The court, Sassaman, J., delivered the following opinion:
    “ In this case there is no doubt that th'e Penn street property was sold under the provisions of the second paragraph of the first section of the Act approved 3d April 1851. • F. V. Wagner, it appears, was the guardian of Valeria C. Albright, and co-tenant with her, upon the death of his mother, Catharine Wagner, who was also grandmother of his said ward. The said Frank V. Wagner was also appointed trustee for the sale of said premises. He sold them and held the money in trust for the interest of his mother and for the said Valeria C. Albright, his said ward, upon the death of his mother.
    “ Under the decision in Large’s Appeal, 4 P. F. Smith 383, this sale converted the land into personalty. The proceeds, for the purposes of the life-estate, retained the character of land; but on the death of the life-tenant they are to be distributed as money. The petitioner is therefore entitled to one-half-of $2433.33, with the interest from the date of the death of Catharine Wagner, which, it seems, occurred on the 7th of February 1875.
    “ We have no doubt that the real estate in. Upper Bern township was sold under the provisions of the third paragraph of the thirty-first section Act of 1832. F. V. Wagner, the guardian of said Valeria, presented his petition for an order-of sale to the Orphans’ Court, on the ground that the rents, issues and profits of the land were insufficient to keep the same in repair, and to the production of revenue to the parties interested, to wit, ‘himself and his mother, the said Catharine Wagner,’ the only parties interested besides his said ward; that the buildings were in a state of dilapidation ; that it would be much to the interest of the parties interested in said real estate and to their advantage that the same should be sold; and after the same was sold, the said Catharine Wagner and Henry M. Albright, the father of Valeria, joined in a petition to the court that he, the said F. V. Wagner, should invest the money — the proceeds of the sale for the parties interested — which was accordingly done.
    “ Under the decisions in Pennell’s Appeal, 8 Harris 515 ; Grider v. McOlay, 11 S. & R. 224; Biggert v. Biggert, 7 Wright 563, and Dyer v. Cornell, 4 Barr 359, we are constrained to hold that money arising from the sale of land by order of the Orphans’ Court, whether it belong to an infant, a feme covert, or a male of full age, is to be considered simply as money and nothing else. It cannot retain its original character for ever. It has no ear-marks by which it can be traced and distinguished from other personal estate. The necessity for a perfect conversion- at some time must be apparent, and the proper time for that is when the money has vested in the party entitled to it. This view has the support of common sense, and is absolutely sustained by authority ; and it matters not whether the moneys of a minor have been in the hands of a guardian or any other legally constituted trustee.
    “ The proceeds, for the purposes of C. Wagner, may have been treated as lands, so far as her income therefrom was affected, but as the estate of Valeria O. Albright, they would be distributed as money. The petitioner is therefore entitled to one-half of $9598.50, with interest from said 7th of February 1875.”
    “ The Act of 18th April 1853 especially provides that nothing in that act contained shall be taken to repeal or impair the authority of any Act of Assembly authorizing the sale of real estate, so that decisions under that act do not interfere with the views above expressed.
    “The 3d section of Act of 8th April 1833 provides that where a person dies intestate without issue and unmarried, if either the father or mother be dead at the time of the death of the intestate, the parent surviving shall enjoy such personal estate absolutely. In this case all the other partios are dead in such order as appears upon the facts presented by the citation and answer. The administrator — the present petitioner — is the proper legal representative to whom the above several sums of money, with interest, are due and payable.”
    From this decree this appeal was taken by the respondents.

      Garrett B. Stevens and A. G. Green, for appellants.
    Under the petition for the sale of the Reading property, only so much of the proceeds of the sale was converted as was necessary to meet the specific purpose therein set forth; the rest continued to be realty: Pennell’s Appeal, 8 Harris 515.
    It is not clear that the second sale was held under the Act of March 29th 1832. The petition sets forth that “they” (meaning the persons interested) “ desire to have it sold for himself and his ward, so as to bar any estate or remainder of any of the parties interested,” and “ give the purchaser a clear and indefeasible title.”
    These words are almost identical with-those to. be found in the “ Price Actand although some of the requirements of the act have not been complied with, yet the saving clause in the fifth section, that no error in the proceedings shall prejudice the title acquired by the purchaser, will effectually relieve the proceeding from invalidity. We aver, therefore, that the petition of 1865, for the sale of the minor’s interest in the Upper Bern property, and the sale granted in pursuance thereof, was under the Act of 1853, and as this act, by its very provisions, substituted the money for the land, that the decree of the court below is erroneous : Holmes’s Appeal; 3 P. F. Smith 339.

      George F. Baer and Jefferson Snyder, for appellee.
    As to the real estate sold under the Act of April 3d 1851, there can be no question about the conversion: Large’s Appeal, 4 P. F. Smith 383.
    The second sale was not under the “Price Act.” It has not been affirmatively shown that it. was under said act; there is nothing to justify such a conclusion but the mere inference drawn from the use of terms in the petition.
   Mr. Justice Gordon

delivered the opinion of the court, March 17th 1879.

About the property embraced in the petition of Mrs. Catharine Wagner, of the 25th of April 1856, there is no controversy. That petition, in its terms, was within the provisions of the Act of 3d of April 1851, hence, the sale under it operated to convert the realty into personalty for all purposes and- must be so distributed. The contest is, therefore, confined to the sale by order of the Orphans’ Court of the land in Upper Bern township, on the application of Franklin V. Wagner, guardian of Valeria C. Albright.

The only question is, Avhether the proceedings by which this sale was brought about, were under the-Act of 29th of March 1832, or under that of 18th of April 1853. If under the former, there was not only a conversion, but the proceeds must be distributed as personalty; if under the latter, they must 'be treated for the purposes of distribution as realty. The determination of this question must depend upon the interpretation of the petition itself, for there is nothing else by which to be directed.

That petition sets out the ownership of the land therein described, as having been vested in fee, in Maria Catharine Wagner. It then sets forth her death, leaving as her sole heirs, her mother, Catharine Wagner, Valeria C. Albright, a minor child of a deceased sister, and the petitioner, Frank V. Wagner, a brother. There is thus set forth a life-estate in Mrs. Wagner, Avith a vested remainder in fee in Miss Albright and Frank V. Wagner, and as all these parties join in the proceedings, the entire estate is represented. This petition further represents, “ that the rents, issues and profits of the said real estate are insufficient to keep the same in repair, and be productive to said parties interested, that the buildings are in a state of dilapidation, that it Avould be much to the interest of the parties interested in said real estate, and to their advantage that the same should be sold.” This puts the case directly within the Act of 1832, and had the petition stopped at this point, there would have been no difficulty, but the person who drafted it, for some mysterious reason of his own, saw fit to add the following, viz.: “ That your petitioner is desirous that it should be sold for himself and ward, so as to bar any estate or remainder of any of the parties therein, and give the purchaser a clear and indefeasible title, and thereby insure a better price for the same.” This clause would, at first sight, bring the proceedings within the purview of the Act of 1853, connected, however, as it is with the preceding clause and with -the recitation of title, it becomes obvious that the court below properly treated it as mere surplusage.

The act last above mentioned was designed to operate upon certain estates and conditions not found in this petition. It alleges a desire to “ bar remainders,” but the statute is operative only on contingent remainders. The fifth section requires, “ that the petition shall set forth an explanation of the title, and of the purpose to bar the entail, defeat the contingent remainder,” &c. It cannot be doubted but that the design, in requiring an explanation of the title to be set forth, was in order that the court might judge, extra the prayer of the petitioner, whether the case was really and properly within the act. If, however, this be the true rendering of the statute, then the present ease is not within the act above mentioned, for the estate mentioned in the petition is unencumbered by entailments, contingent remainders or executory devises. It cannot be doubted but that the joint deed of the parties would vest in their vendee a fee-simple absolute. Such being the case, there is nothing requiring the intervention of the Act of 1853, it is, therefore, out of the question, since no decree could properly have been made under it.

Decree affirmed, appellant to pay the costs.


text:
    First National Bank of Allentown versus Rex.
    1. Where a national bank receives a special deposit for safe-keeping without reward it is liable only for gross negligence, and the burden of proving this gross negligence is on the plaintiff.
    2. The bank under such circumstances is not responsible for that care which every attentive and diligent person takes of his own goods, but only for that care which the most inattentive take.
    3. It seems, that the removal by such a bailee of the special deposit from one depository to another considered more safe does not increase the bailee’s liability.
    4. Bank of Carlisle v. Graham, 29 P. F. Smith 106, followed.
    March 5th 1879.
    Before Sharswood, C. J., Mercur, Gordon, Woodward, Trunkey and Sterrett, JJ. Paxson, J., absent.
    Error to the Court of Common Pleas of Lehigh county: Of ■January Term 1879, No. 170.
    Assumpsit by George Rex against the First National Bank of Allentown.
    The defendant is a corporation chartered under the National Bank Act of January 3d 1864. On March 31st 1869, Rex called at the bank and made a special deposit of certain bonds of the United States. William H. Blumer, the president of the bank gave him a certificate, of which the following is a copy.

      “ I certify that George Rex has on deposit for safe-keeping at the First National Bank of Allentown, Eight Hundred and Fifty Dollars in 5-20 United States bonds.
    “Wm. H. Blumer, President.
    “Allentown, March 31st 1869.”
    The bonds were received without any compensation, and were kept in the vault with the other valuable papers of the bank. It was shown that the bank was in the habit of thus receiving special deposits of bonds and other valuable securities for safe-keeping. No charge was made for thus keeping them, or collecting the interest thereon, and the president testified that the same care was exercised in keeping the papers of. other people as was exercised in the keeping of the papers of the bank. The interest on the bonds was regularly paid to Rex by the son of the president, who was the cashier of the bank. In the spring of 1877 the banking firm of William H. Blumer & Co., of which firm William H. Blumer was a member, became financially embarrassed, and in order to raise money to meet the claims of their depositors the bonds of Rex, with those of other depositors, were taken from the vault of the National Bank and hypothecated with a broker in Philadelphia, and the money obtained therefrom was used by the firm.
    Rex testified that he called at the bank and asked Jacob A. Blumer for the bonds, and he said he could not give them to him as they had been sent to Philadelphia for safe-keeping ; that the bank had sent all their papers of any worth to Philadelphia, and that those of Rex were among them; that he would get them back, and' mentioned a particular time for their return. Mr. Fink, who had been sent to the bank by Rex with the certificate to procure the bonds, also testified that William H. Blumer had told him that the bonds had been sent to Philadelphia for safe-keeping. William H. Blumer being recalled, testified that the bank never had any bonds or papers in Philadelphia for safe-keeping.
    The defendant upon this evidence moved for a nonsuit which the court refused. It then, without offering any- evidence, submitted the following points, to which the answers of the court, Albright, P. J., are appended:
    1. Under all the evidence the verdict must be for the defendant.
    Ans. “ This instruction is refused.”
    2. The defendant being a bailee without reward and there being no evidence of gross negligence resulting in the loss, the verdict must be for the defendant.
    Ans. “ Before plaintiff can recover he must satisfy you that the bonds were lost through the gross negligence of the defendant; the question of the degree of negligence is for the jury.”
    3. It appearing in this case that the bonds were abstracted by the president for his own purposes, and there being no proof that the bank knew or had any reason to believe that the president was dishonest, the verdict should be for the defendant. •
    Ans. “ If the bonds were abstracted by the president without the knowledge of the bank the defendant is not liable. Further answer to this point is refused, except so far as the same is answered in the general charge.”
    In the general charge the court, inter alia, said :
    “ When a party delivers to another goods without any reward on the part of the bailor to the bailee, or when the bailee undertakes to preserve the property thus delivered without any pay, that is what is called a ‘ gratuitous bailment,’ and the bailee is required to exercise what is called only £ slight diligence’ in taking care of the property. * * *
    “And in a case like the one before us, when slight care is required to be exercised on the part of the bailee the defendant is liable only in case of gross negligence. Negligence is defined to be the absence of care, or the omission by a party to exercise that diligence which a prudent man ordinarily exercises in regard to his own property. Has the defendant in this case been guilty of that degree of negligence, viz.: gross negligence ? * * *
    “ It is also alleged on the part of the plaintiff, that William H. Blumer had used these bonds in Philadelphia to raise money for his own private purposes. This alone would not make the bank liable, if William H. Blumer or any one else abstracted those bonds or stole them ; but if you can find from the evidence that William H. Blumer did use these bonds for his own private purposes, and that such use by him was known to the officers of the bank, and there was an assent on their part to such improper use, or no effort was made to recover the bonds, if they were recoverable, that would be negligence on their part; or if you find that the proper officers of the bank did send these bonds to Philadelphia for safe-keeping, the relation existing between Rex and the defendant would be.changed from what it originally was. If the First National Bank of Allentown for its own convenience or profit selected some other depository for these bonds, it would be liable in case of loss even if but ordinary negligence were shown.”
    "Verdict and judgment for plaintiff. The defendant took this writ and assigned for error the answers to the above points and the portion of the charge noted.

      Edward Harvey and E. E. Wright, Jr., for plaintiff in error.—
    The taking of special deposits for the accommodation of the depositor is not within the authorized powers of a national bank: Wiley v. First National Bank, 47 Yt. 546 ; First National Bank of Charlotte v. National Exchange Bank, 2 Otto 122; Whart. on Neg., sect. 470. Although this court has held that national banks may assume liability for the loss of special deposits, we respectfully submit that under the ruling in the Bank ¿'.-Bank, supra, these decisions should he re-examined.
    There was not sufficient evidence, of gro^s negligence to submit to the jury. The bank was a mere depository of the bonds without profit or reward. It kept them in the same vault and with the same care that it kept all the valuables in its custody. The person who took the bonds and used them for his private purposes, was the president of the bank, and as such, was privileged to, go into the vaults at his pleasure. No one could deny his access to any part of the bank or could question his authority to supervise and examine the personal property owned by or in charge of the corporation. Unless, then, the bank had knowledge that the president was a dishonest or unfit person to exercise the authority of the office, and continued him in the employment or trust afterwards, it cannot be held liable. There must be gross neglect on the part of the bank, or there is no civil liability in a case like this: Ooggs v. Bernard, 2 Ld. Raym. 909 ; Story on Bailments, sect. 23; Whart on Neg., sect. 469; Foster v. Essex Bank, 17 Mass. 479.
    A bank is not liable for the default or dishonesty of its officers, provided due care was exercised in the selection of them : Whart. on Neg., sect. 469; Tompkins v. Saltmarsh, 14 S. & R. 275; Lloyd v. West Branch Bank, 3 Harris 176; Scott v. National Bank of Chester Valley, 22 P. F. Smith 477; First National Bank of Carlisle v. Graham, 29 Id. 116; Smith v. First National Bank of Westfield, 99 Mass. 605. It is the duty of the court to instruct the jury fully as to what constitutes negligence: P., F. W. & O. Railroad Co. v. Evans, 3 P. F. Smith 250; and the court should have defined what gross negligence is.

      John Rupp, for defendant in error.
    If.it is the custom and habit of a national bank to receive bonds, or other valuable securities on deposit, for safe-keeping, with the privity and knoAvledge of the directors and officers of the bank, a liability for safe-keeping is raised, and if the securities are afterwards lost or stolen through the gross negligence of the bank, the bank becomes liable for the value thereof: First National Bank of Carlisle v. Graham, 4 Norris 91; Same v. Same,' 29 P. F. Smith 106; Scott v. First National Bank of Chester Valley, 22 Id. 471.

      Gross negligence is the want of that care which every man of common sense takes of his own property : 1 Chit. Con. 662.
    The contract of bailees, without reward,-is not merely for good faith but for such care .as persons of common prudence in their situation usually bestow upon such property. If they omit such care it is gross negligence: Tracy v. Wood, 3 Mason 132; Scott v. First National Bank of Chester Valley, 22 P. F. Smith 471; Lancaster County National Bank v. Smith, 12 Id. 47; Story on Bailments 564.

      • This case is identical with that of the First National Bank of Carlisle v. Graham, 4 Norris 91.
   Mr. Justice Gordon

delivered the opinion of the court, March 17th 1879.

The learned judge of the court below was accurately correct when he instructed the jury that the defendant, in a case like that under consideration, was held only for gross negligence, and that it rested upon the plaintiff to show affirmatively that the bank was guilty of such negligence. He errs, however, when he comes to define what the term “gross negligence” means. He says, “In a case like the one before us, where slight care is required to be exercised on the part of the bailee, the defendant is liable only in case of gross negligence. Negligence is defined to be the absence of care, or the omission by a party to exercise that diligence which a prudent man ordinarily exercises in regard to his own property. Has the. defendant in this case been guilty of that degree of negligence, viz., gross negligence ?”

Had this definition been omitted it might have been presumed that the jury, from the use of the terms slight care and gross negligence, would have reached a proper conclusion as to their meaning and effect,-but in such case the presumption would be that the idea of ordinary care and ordinary prudence had been excluded, but this would necessarily exclude the learned judge’s definition.

The fact is, the rule thus laid down by the court is the one which our brother Woodward, in the case of the Bank v. Graham, 29 P. F. Smith 106, adduces as decisive of the bailee’s good faith and performance of his whole duty. In other words, as is said by Duncan, Justice, in Tompkins v. Saltmarsh, 14 S. & R. 275, “the bailee without reward is not bound to ordinary diligence, is not responsible for that care which every attentive and diligent person takes of his own goods, but only for that care which the most inattentive take.”

It follows that if the defendant committed only a breach of ordinary care and diligence, in the keeping of the plaintiff’s bonds, the verdict should have been in its favor.

Conceding that the bank, in case of gross negligence, would be liable for the loss charged, and we do not stop to discuss this question, as it has been definitely settled in the case of the Bank v. Graham, above cited, then what remains is the inquiry whether the defendant was grossly negligent in the care of the property committed to its charge.

On this branch of the case the court charged that the mere fact that Blumer, the president, had used the bonds to raise money for his own private purposes, would not of itself make the bank liable, but if this improper use by him of the plaintiff’s property was known to the bank officers, and they assented thereto, or if they had knowledge thereof, and made no effort to recover this property if it were recoverable, that would be such negligence on their part as would render the bank liable.

This is good, sound law, but we fail to discover the evidence which adapts it to this case. If there was any evidence showing knowledge on part of any of the bank officers but Blumer and his son, of or concerning these bonds or their use, proper or improper, it does not appear in the records submitted to us. Again the learned judge says, “ If you find the proper officers of the bank did send these bonds to Philadelphia for safekeeping, the relation existing between Rex and the defendant would be changed from what it originally was. If the First National Bank of Allentown, for its own convenience or profit, selected some other depository for these bonds, it would be liable in case of loss, even if but ordinary negligence was shown.”

The first sentence of the above quotation is not easy of comprehension ; for if the bonds were in good faith transferred to a place considered more safe than that of the original deposit, we cannot see how the relations of the parties would be changed, or how the liability of the bank would be thereby increased. The same objection, however, lies to this and the succeeding sentence as to the main part of the charge as already stated, that is, there is no evidence to support them.

It is, indeed, true, that at one time Blumer, and at another time his son, when applied to for the bonds, said they had been sent to Philadelphia for safe-keeping, but it is evident from the whole evidence of the case that this was a mere fabrication to gain time. The fact is manifest and uncontradicted that Blumer had abstracted the bonds and used them for his own purposes. He himself admits this, and states that the bank had neither bonds nor papers of any kind in Philadelphia for safe-keeping.

About the fraud of Blumer there is no doubt, but that the direc-’ tors knew of that fraud, or that they had reason to doubt the previous honesty of their president, there is literally not one word of evidence. Perhaps the plaintiff may do better on another trial, but as yet he has shown nothing which ought to have prevented the court from affirming the defendant’s second point.

Judgment reversed, and new venire awarded.


author: Mr. Justice Woodward,

text:
    Spencer et al. versus Colt.
    1. When such terms as “ clear, precise, .explicit, unequivocal and indubitable,” are used by the courts, in defining the requisite proof of a particular fact to be made out by verbal testimony, it is meant that a conviction shall be fastened in the minds of jurors as strong as verbal testimony is able to convey. It is meant that witnesses shall be found to be credible, that the facts to which they testify are distinctly remembered, that details are narrated exactly and in due order, and that their statements are true. Absolute certainty is of course out of the question.
    2. The court below charged in regard to an alleged parol agreement to reform a written instrument, that said agreement should be made out by “ clear, precise and indubitable proof.” Held, that these words restrained by inherent limitations could do no harm.
    3. While everything that was said and done at the execution of the instrument is evidence, the unexpressed intent, motive or belief of defendant is not admissible.
    March 5th 1879.
    Before Sharswood, C. J., Mercur, Gordon, Woodward, Trunkey and Sterrett, JJ. Paxson, J., absent.
    Error to the Court of Common Pleas of Lehigh county: Of January Term 1879, No. 166.
    Debt by Henry Colt against Osborn Spencer and Jacob Mauser, on fifteen bonds executed by defendants and delivered to plaintiff to secure the payment of $15,000, the purchase-money for a tract of land.
    The facts are stated in the opinion of this court.
    At the trial before Harvey, P. J., the defendants proposed to ask the following questions: “What .was the inducement that led you to sign the bonds and mortgage ?” Objected to as incompetent and irrelevant.
    The court said:
    “ The court is of the opinion that the jury is to determine what induced the parties to sign the instrument from what was said and done before the time of signing, and that it is improper to allow the witness to state the intention or purpose that was in his mind at the time of the execution. We think it is incompetent, and sustain the .objection.” (Seventh assignment of error.)
    Q. “ Did you sign these bonds and the mortgage, relying at the time upon the contemporaneous agreement in parol, that Mr. Colt was only to look to the real estate for the payment ?”

    Objected to as incompetent.
    The' Court: “ I am of the opinion that it is proper for the defendants to prove by legitimate proof what is contained in the offer, but I am of the opinion that it is not proper to present it to the witness in this form for the purpose of getting out of him what intention or purpose existed in his mind at the time of the execution of the paper. The objection, therefore, is sustained.” (Eighth assignment.)

      Q. “ In consequence of the acts and declarations of Mr. Colt, did you sign these papers ?”
    Objected to as incompetent.
    “ The court permits the defendants to give all that was said and done before and at the time of the execution of the bonds, but will not permit them to give any intention that existed in the mind at the time of their execution, and as the offer seeks only to give the intention wTe sustain the objection.” (Ninth assignment.)
    In the general charge, the court, inter alia, said: “ In considering it (the alleged contemporaneous agreement), you are admonished that the bonds are primarily regarded as the voluntary and lawful contract of the parties, and before this presumption can be overthrown, it is incumbent on the defendants to prove the alleged contemporaneous parol agreement or stipulation by evidence that is clear, precise and indubitable. (First assignment.)
    “ Hence, you will observe that it must be shown that the alleged condition or stipulation was agreed to by Mr. Colt. In other words, it must be shown that Mr. Colt, on the one hand, and Messrs. Spencer and Mauser on the other, agreed that the alleged condition or stipulation should be part of this cóntract. * * * Or,
    is it probable that the defendants might have claimed exemption from personal liability; might have done and said all they claim to have done or said, and yet Mr. Colt did not assent to it ? (Second assignment.)
    “ The defendants could have called him (meaning John D. Stiles, the subscribing witness), and it must be confessed that the omission to call him is as much, if not more, the duty of the defendants than of the plaintiff. (Third assignment.)
    “If you find that he (meaning Mr. Colt), has shown himself forgetful of some of the material statements made when the bonds were executed; if he has given reasons, or testified to things that are irreconcilably inconsistent with the undoubted proof as it appears in the cause, it will be some reason why you should not consider his testimony potent enough to create a beneficial doubt in his behalf. (Fourth assignment.)
    “ If the defendants have established that it was agreed between them and Mr. Colt, that the alleged parol condition should he a part of the contract, and it was the operating cause of the execution of these bonds, and this has been shown by clear, precise and indubitable proof, then these bonds must b.e regarded as containing that stipulation. (Fifth assignment.)
    “ If the defendants have established, that it was agreed between them and Mr. Colt, that the alleged parol condition should be a part of the contract, and it was the operating cause of the execution of these bonds, * * * then these bonds must be regarded as containing that stipulation.” (Sixth assignment.)
    The verdict was for plaintiff, and after judgment the defendants took this writ and alleged that the court erred as set forth in the foregoing assignments of error.

      John Rupp, O. J. Brdman, William U. Sowden and A. B. Longalcer, for plaintiffs in error.
    It is not necessary that the evidence should be clear, precise and indubitable. This rule is too stringent. All that is required, is that the evidence should be satisfactory : Young v. Edwards, 22 P. E. Smith 257. We do not seek to vary or contradict the terms of the written contract, but only to control its legal operation by a contemporaneous parol agreement, on the faith of which it was executed and without which the bonds would not have been signed: Chalfant v. Williams et al., 11 Casey 212; Martin v. Berens, 17 P. F. Smith 459 ; Caley v. Phila. & Chester County Railroad Co., 30 Id. 363 ; Graver v. Scott, Id. 80.
    Assuming it to be the rule that the defendants must satisfy the jury that the contract was the inducing and operating cause, then it is respectfully contended, that wherever a party to the action is a competent witness, and the intent or motive with which an act is done is an essential ingredient to sustain the action, it is permissible for him to testify to that intent: Snow v. Paine, 114 Mass. 520 ; Thatcher et ux. v. Phinney, 7 Allen 149; Lombard v. Oliver et al., Id. 155; Sowers v. Dukes, 8 Minn. 23 ; Spaulding v. Strang, 36 Barb. 310; Courtland County v. Superintendent of the Poor of Herkimer County, 44 N. Y. 22; Broom’s Maxims 352.

      John B. Stiles for defendant in error.
    To reform a written instrument the evidence must be clear, precise and indubitable: Martin v. Berens, 17 P. F. Smith, 257; Stine v. Sherk, 1 W. & S. 195; Miller v. Smith, 9 Casey 386; Irwin v. Shoemaker, 8 W. & S. 75; Dean v. Fuller, 4 Wright 474; Woods v. Farmere, 10 Watts 195; Hart v. Carroll, 4 Norris 508. The inducement or motive of the parties cannot be given in evidence. These are questions for the jury to be inferred from the facts : Lancaster Bank v. Smith, 12 P. F. Smith 47 ; Irwin v. Shoemaker, supra; Court-land County v. Supt. of Poor of Herkimer County, supra.

   Mr. Justice Woodward,

delivered the opinion of the court May 5th 1879.

On the 1st of April 1874, the defendants below executed and delivered to the plaintiff a mortgage and fifteen accompanying bonds to secure the payment of $15,000, the purchase-money for a parcel of land in the city of Allentown. The mortgage and bonds, as well as the deed from the plaintiff, were all made out in'pursuance of a written agreement previously entered into between the plaintiff and Mr. Spencer. Mr. Mauser became interested in the purchase while the contract was executory. The agreement wás given in evidence, but has not been brought up. When the deed was made and the securities delivered, a stipulation, signed by the plaintiff and Mr. Spencer, was endorsed on the agreement, setting forth that it should “ remain in force as the covenant between the parties for the performance of every matter therein contained, except the execution and delivery of the deed, and the giving of the mortgage and bonds.”

Upon the trial some facts were undisputed. When the parties met to execute the contract, the bonds were found to have been prepared with accompanying warrants of attorney. Mr. Mauser refused to sign them on the ground that, he was dealing in real estate, and would be hampered by the liens of the judgments. The defendants consulted Mr. Rupp, as counsel, and negotiations were entered into by him and them with the plaintiff and Mr. Stiles. The result was that the warrants of attorney were severed from the bonds and a stipulation was inserted in the mortgage that the whole amount of it should become due and collectible if there should be delay in making any one payment for a period of forty days. The. plaintiff took the bonds, with the remark that he would put them in bank for safe-keeping, and the parties separated.

From this point the facts were Contested. The defendants alleged that at the time when the papers were delivered it was agreed that the plaintiff would look to the land alone for the whole purchase-money, and that any judgment or judgments that should be. obtained on the bonds should be liens only on that land. The witnesses who testified in support of the agreement were Mr. Rupp and the defendants themselves. The substance of Mr. Rupp’s statement was, that he found in Mr. Stiles’s office fifteen bonds for $1000 each, with powers of attorney to confess judgment, and that Mauser refused to sign them as they were written. He then stated his recollection of the agreement in these words: “ As I understand it, Colt was to look to the coal yard property only for his money, and I recollect no other circumstances now. I think this restricT tion never applied to Spencer.” Mr. Maus.er’s version of the agreement was this: “I told him (Mr. Colt) then and there that I would not sign anything; that I was in the real estate business, and would sign nothing that was a lion or would become a lien on anything but that property. Mr. Colt said the property was cheap; that he would take it back at any time if the investment did not give satisfaction. Mr. Rupp said, ‘ If that is the understanding, that it shall be restricted to that property alone, you can sign it.’ Mr. Colt agreed to it; he said, ‘Yes; I agree to it; the property is cheap, and I will take it back at any time.’ On that agreement I signed the bonds.” On cross-examination Mr. Mauser said he had testified on this subject before an auditor, in October 1878-. He was asked: “Didn’t you say before the auditor that the judgment parts of the bonds were torn off, and that then you signed them — -just those words?” The answer was, “Yes, sir.” Mr. Spencer’s testimony was this: “ Mr. Mauser said he would not sign the bonds, and went on to explain in the presence of Mr. Colt, saying that these bonds extended to all the property we owned. I then said I would not sign them either. * * * After he found Mr. Mauser insisted on not signing them, Mr. Colt was satisfied to alter the papers so that the mortgage was a lien on this property alone. If I am right, Mr. Colt, after Mr. Mauser told him how he wanted the papers drawn, said, ‘Very well, we will fix them up in that way.’ They then went on and fixed them up in that way. If I recollect rightly, they were signed as soon as they got them ready. * * * After Mr. Rupp said it was drawn up so as to confine it to this property, we signed it. I asked Mr. Rupp at the time if it extended beyond this property, and he said, ‘No.’ ” The plaintiff, on the other hand, ^declared in positive and distinct terms that such an agreement as that alleged by the defendants was ever made.

In view of the facts admitted or clearly proved at the trial this attempt to strike down and annihilate bonds amounting to $15,000, which the plaintiff thought worth depositing in a bank for safety, seems to have resulted in enveloping the transactions of the 1st of April 1872 in a sort of hazy cloud. The testimony in its vague and shifting forms tended to mystify rather than to elucidate those transactions. But the court were not asked to express an opinion as to the adequacy of the proof to warrant a reform not only of the bonds, but of the original agreement between Spencer and the plaintiff. The cause has been brought here for a review of the errors of law charged to have been committed at the trial. Those of them that seem material relate to the measure of proof which the judge required, to the rejection of some testimony offered by the defendants, and to a portion of the charge in which the character and effect of the plaintiff’s testimony were discussed. The duty of this court consists merely in passing upon the questions which the parties have presented.

It was said in Hart v. Carroll, 4 Norris 508, that “in the very nature of things, that conclusive and absolute proof which results from the production of record evidence, or rests .on the solution of a mathematical problem, can never be the effect of the verbal testimony of human witnesses;” and that “ the language of the authorities is to be taken and treated in its connection with and its relation to the subjects and instrumentalities to which it has been applied.” A preceding sentence in the opinion in that case was made meaningless by the omission in transcribing of a qualifying clause. When such terms as “clear, precise, explicit, unequivocal and indubitable” are used by the courts in defining the requisite proof of a particular fact to be made out by verbal testimony, it is meant that a conviction shall be fastened in the minds of jurors as strong as verbal testimony is able to convey. It is meant that witnesses shall be found to be credible — that the facts to which they testify are distinctly remembered — that details aré narrated exactly and in due order — and that their statements are true. The word “indubitable,” the application of which by the president of the Common Pleas has been made the ground of such urgent complaint, was used in a sense subject to these limitations, and would necessarily be so understood. Absolute certainty is of course out of the question. Terms are used with relation to their subject-matter. The apparently distinct testimony of the most intelligent witness may possibly be fabricated. The clear statement of the most upright witness may possibly be mistaken. It has been in view of considerations like these, that in certain classes of cases, proof is required that is “clear, distinct and entirely satisfactory:” Rearich v. Swineheart, 1 Jones 233; that is “clear, explicit and unequivocal: McGinity v. McGinity, 13 P. F. Smith 42, and Plumer v. Guthrie, 26 Id. 455; that shows “a case of clear and palpable fraud:” Hain v. Kalbach, 14 S. & R. 161; or that is “full, satisfactory and indubitable:” Woods v. Farmere, 10 Watts 195. In The Attorney-General v. Sitwell, 1 You. & Col. 584, a remark of Lord Thurlow in Shelburne v. Inchiquin, 1 Bro. Ch. C. 347, to the effect that “the final evidence must be strong, irrefragable evidence,” was criticised in these words: “ If by this language his lordship only meant that the mistake should be made -out by evidence clear of all reasonable doubt, its accuracy need not be questioned, but if he meant that it should be in its nature or degree incapable of refutation, so as to be beyond any doubt, and beyond controversy, the language is too general.” This criticism states fairly enough the rule that governs our own courts. It requires that in .controversies in W’hich parol sales of land are set up, or where written instruments are sought to be reformed, juries must not hesitate or doubt— they must have clear convictions — they must believe the witnesses, and must find the facts in issue definitely and distinctly established. In this case the court charged that the alleged agreement should be made out by “clear, precise and indubitable proof.” These words, restrained as they are by inherent limitations, could do no harm.

Brief discussion only is required of the remaining assignments of error. The two portions of the charge coupled together in the second assignment were upon two different branches of the case, and were separated from each other to the extent of almost a printed page of the paper-book. The last clause, of which special complaint is made, occurred in the instruction to the jury as to their duty in reconciling conflicting testimony. They were asked whether, if they found that the defendants did and said all that they declared they had done and said, they could still find that the plaintiff did not accede to their demands. If so, there was no contract. In a proper issue, some question of estoppel might be presented. But no such question here was raised or tried.

Surely no obligation rested on the plaintiff to put Mr. Stiles on the stand. It is true, he was the subscribing witness to the bonds-, but he was also the counsel who was trying the cause. All that the court said on this subject was brought out by the argument of the counsel for the defence, founded on the neglect to make him a witness. If his testimony was desired, or would have been useful, he could have been called on behalf of the defence.

Taking in connection and as a whole the instructions to the jury in regard to the plaintiff’s testimony, it was fairly submitted.

It was the very point of the case of the defendants, that the parol agreement was the inducement — “the operating cause” — for the execution of the bonds. The fifth and sixth assignments are without foundation.

No principle can be recalled that would have justified the court in admitting the .testimony specified in the seventh, eighth and ninth assignments. Everything that was said and done at the time when the bonds and mortgage were executed, was received. The unexpressed intent, motive or belief existing in Mr. Mauser’s mind when he signed the papers, could not aid the jury in ascertaining whether the language or conduct of the plaintiff had been such as to create such an intent, motive or belief. The parties to a contract may often have different impressions regarding its effect upon their respective interests, but the thoughts of one certainly cannot be proved to bind the other.

Judgment affirmed.


author: Per Curiam.

text:
    Erdman et al. versus Barrett. In re contested election for Prothonotary of Bucks County.
    1. Where in an election there is a tie vote returned eitner party may contest the election.
    2. In such an event the proceedings must be against, and the notice given to the other party and not to the incumbent holding over, who although indirectly interested is in no way a party to the contest.
    March 5th 1879.
    Before Sharswood, O. J., Mercur, Gordon, Woodward, Trunkey and Sterrett, JJ. Paxson, J., absent.
    Certiorari to the Court of Quarter Sessions of Bucks county: Of January Term 1879, No. 165.
    This writ was taken to bring up for review the record and proceedings in the matter of the petition of H. M. Erdman and others to contest the election for prothonotary of the Court of Common Pleas of Bucks county.
    On November 7th 187S, a general certificate of the result of the election held November 5th 1878, was filed in the office of the Prothonotary of the Court of Common Pleas, certifying that Thomas T. Ochs received 7610 votes, that Thomas S. Folwell received 7610 votes, and that William Martin received 161 votes for the office of prothonotary. ■
    On December 5th 1878 Erdman and others, by leave of the court, filed a petition contesting the election of prothonotary. The petition represented, inter alia, that no one was returned elected for the office of prothonotary, because it appeared from the returns of said election that there was a tie vote between the two highest candidates ; that the election for said office was undue and illegal and the returns thereof incorrect, and the petitioners claimed that Thomas T. Ochs was duly elected, and prayed for a rule to answer upon James Barrett, the incumbent, who, by virtue of the return of a tie vote between the two highest candidates, claimed the right to hold the office until the next election.
    A rule was granted, and the court ordered notice of the filing of petition, with copy thereof, together with rule, to be served upon the opposite party thirty days before the day fixed for hearing.
    The answer of James Barrett claimed, inter alia, the right to hold said office until the next election, for the reason that there was no election of his successor.
    After argument the court, upon their own motion, dismissed the proceedings because notice of the filing of the petition wás not given to Thomas'S. Folwell, and because the counsel for petitioners declined to ask for a rule upon the said Folwell to answer the petition.
    In an opinion the court, Watson, P. J., inter alia, said:
    “ On the eighth of January 1879, for reasons then verbally stated, the court directed this proceeding to be dismissed, a formal decree to be drawn and entered thereafter, and also, if thought proper, a written opinion to be filed upon the subject. This opinion and the decree appended will therefore be filed as of that day.

      “ I have no doubt of the right of a candidate returned as having received an equal number of votes with another candidate voted for at the same time, or- of others acting in his interest, to contest the election in the same manner and to the same extent as when the opposing candidate is returned as having received a plurality of votes and the' contestant is apparently in the minority. Where there is' a tie vote returned, either party ought to have the right to contest the election. This contingency is not expressly provided for by the Act of Assembly on the subject, but the case is clearly within the spirit of the act, and I have no doubt of the right of either party to proceed under it. If this were not so, then it might happen that the two highest candidates returned as having received an equal number of votes would both be in a worse position than if 'one of them was apparently in-the minority, for both alike would be without remedy for the purpose of showing irregularities in the election, and that the one or the other of them received a plurality of the ballots and was entitled to the office. The act is broad enough to meet the case.
    “ The contest is to be begun and carried on in the same manner and is to be followed by the same judgment as when one candidate is apparently in the majority and the other in the minority. The object is to determine who has received the highest number of votes legally cast. The court is to investigate, the election, to correct alleged errors when they are shown to exist, and to determine the true result.
    “ Upon the presentation of the petition, a day is to be fixed for hearing, notice is to be given to the person whose right of office is contested, and a rule served upon him to appear and answer the complaint. By the Act of 18-39, notice was to be given to the £ person returned.’ The Act of 1874 directs it shall be given to the ‘person whose right of office shall be contested.’ I regard these provisions as the same. The distinction between them is verbal merely. The evident design is to provide for notice to the opposing candidate who may claim the office by virtue of the election in question. The proceeding is by no means ex parte; the hearing is to be after full notice; the declared will of the voters in the choice of the officer is to be ascertained if possible and their verdict at the polls is to be respected and enforced.
    “We are to inquire into and determine the right of office by virtue of the election to be investigated, and not by virtue of a previous election under which the present prothonotary holds. The contest is between the candidates voted for; they only can claim the right of office under the election to be investigated. To my mind, it follows clearly and necessarily that the notice in this case should have been given to Mr. Folwell, the opposing candidate, and not to Mr. Barrett, the present prothonotary. Mr. Barrett, it is true, may be indirectly interested, as he will hold the office until his successor shall be duly qualified, but he has no direct interest whatever in the contest, and is in no wise a party to it. Whether it result in favor of the one or the other of the candidates is a matter of no more consequence to him than to any other citizen of the county.
    “ If either of them should be declared elected and become duly qualified, he must resign his place to his chosen successor. The burden of maintaining a contest that is in no sense his cannot be thrown upon him, nor can he be set up as a respondent to avoid the necessity of notice to the real party in interest. The notice in this case being given to Mr Barrett only, is therefore defective. The rule upon him was improvidently granted; the attention of the court was not called to the fact that he was named in the petition as respondent and the rule asked for upon him. It was granted upon and notice directed to be given to the ‘ opposite party,’ who was assumed to be Mr. Folwell, without examining the concluding part of the petition to see who was named. If our attention had been called to the subject the error would, have been corrected at the time.
    “ But the remedy invoked ought not to be defeated by the mistake that has been made. Full opportunity should be afforded for the investigation of the election and the correction of alleged errors therein, in order that the true result may be ascertained and the candidate who has received the votes of a plurality of his fellow citizens maybe declared elected and enjoy the office to which their choice has entitled him. This may yet be done.
    “ If the counsel for the petitioners desire it, we will continue the proceeding, fix another day for the hearing, and grant a rule now upon Mr. Folwell to appear and answer upon that day.
    “ The counsel, after consultation, say they decline to ask that this be done. The court will not of their own motion direct it. The proceedings are therefore dismissed in accordance with the following decree:
    “And now, to wit, January 8th 1879, this case came on to be heard upon the petition and answer; and the court being of the opinion that the rule upon James Barrett, the present prothonotary, as respondent, was improvidently granted, and that the notice to him is defective as not in compliance with the Act of Assembly in such case made and provided ; and the counsel for the petitioners declining to ask that the proceedings be continued to another day to be fixed for the hearing thereof, and a rule be now granted upon Thomas S. Folwell, who was returned as a - candidate voted for at the election and receiving an equal number of votes with Thomas T. Ochs, whose election is claimed by the petitioners, to appear on the day to be so fixed and answer the complaint of the petitioners, it is, therefore, after due consideration, adjudged and decreed by the court that the said complaint be dismissed.
    “ And the court being of opinion that the facts set forth in the petition constitute probable cause for the complaint, therein, does therefore direct that the costs of the proceedings be paid by the county.”
    The dismissal of the petition was assigned for error by the petitioners who took this appeal.

      Robert L. Cope, N. O. James and J. I). James, for appellants:—
    As soon as a petition to contest an election is filed, the jurisdiction of the court attaches, and the investigation must' go on if such facts are set forth as would, if proved, change the result. Neither the petitioners nor the person claimed by them to have been elected can withdraw the petition. The public are interested in knowing the result: Kneass’s Case, 2 Pars. 553; Mann’s Case, 1 Brewster 41. Notice of tte filing of the petition is not a- pre-requisite to the filing of the petition and the jurisdiction of the court but to the healing, and the court may extend the time of hearing where no notice tc the proper parties has been given and direct notice to be givem: Sailer v. Keating, 32 Leg. Int. 134, Mitchell, J. The petitioners should have had notice, a reasonable time, of the objection for want of proper parties. Théy should have not been required upon the day the objection was raised to ask leave to amend so as to bring in the necessary parties. They had a right to be heard after a reasonable notice, which by the rules of this court is fourteen days (Rules of Equity Practice, No. 27), upon the question of want of proper parties. The petitioners had a right to object to Mr. Folwell being made respondent after he had lost his right to contest the election, and not being returned elected. If they should have asked to have him made a party, they could not afterwards object to his right to file an answer and contest the election to the same extent as if he had filed a petition in time.
    The returns on their face gave Mr. Barrett the right to hold over and he was the only person interested in the contest of the returns. He is the one whose right of office is contested': Mark et al. v. Park, 7 Leg. Graz. 55.

      Greorge Moss, L. L. James and Harman Yerlces, for appellee.—
    Barrett had no right to be made a party to this proceeding. Not having been a candidate no interest of his could possibly be involved. We adopt the opinion of the court below as our argument.
   The judgment of the Supreme Court was entered, March 24th 1879,

Per Curiam.

We affirm the proceedings in this case upon the opinion of the learned president of the court below.

Proceedings affirmed.


author: Mr. Justice Mercur

text:
    First National Bank of Allentown versus Hoch.
    1. A national bank has no charter, statutory or incidental powers to act as a broker or agent in the purchase of bonds and stocks.
    2. Where a paper on its face shows the transaction not to be within the usual course of business of such a bank, it is not binding on the bank, although signed by the president thereof as such officer.
    3. The president is the executive agent of the board of directors, within the ordinary business of the bank, but cannot bind it by a contract outside thereof without special authority.

      4. I-I. left a thousand dollars with the president of a national bank and took the president’s receipt in these words: “Received of H.$1000, to be
    invested in bonds of the city of Allentown, bearing seven per cent, interest. Interest on said deposit to be allowed from this date and to be accounted for on demand.” The money was misappropriated, and II. sued the hank there for.- JHeld, that he could not recover.

      March 5th 1879.
    Before Sharswood, 0-J., Mercur, Gordon, Woodward, Trunkey and Sterrest, JJ. Paxson, J., absent.
    Error to the Court of Common Pleas of Lehigh county: Of January Term 1879, No. 169.
    Assumpsit by William Hoch against the First National Bank of Allentown, to recover the balance due on an alleged certificate of deposit. The bank pleaded the general issue, and specially that the paper supd on was not .the assumption and promise of the bank; that the president of the bank had exceeded his authority in giving it; and that the money left by Hoch had never been received by the bank.
    On December 18th 1875, William Hoch, the plaintiff below, called on William H. Blumer, the president of the First National Bank, for the purpose of purchasing bonds of the city of Allentown. The office of city treasurer was in the same room where the bank did business, and the cashier of the bank was the city treasurer. As the bonds were not ready for delivery, the sum of $1000 was left with William H. Blumer, and he gave a receipt as follows:—
    “$1000. ■ Allentown, Dec. 18th 1875.
    Received of Mr. William Hoch, one thousand dollars, to be invested in bonds of the city of Allentown, bearing seven per cent, interest. Interest on said deposit to be allowed from this date and to be accounted for on demand. W. H. Blumer,
    President First Nat. Bank.”
    June 23d 1876, Mr. Hoch received from J. A. Blumer, who was the treasurer of the city, one bond for $500, and the following was endorsed on the receipt:—
    “Received, June 23d 1876, of J. A. Blumer, one bond of city, of Allentown, No. 210, five hundred dollars, on account of within receipt. William Hoch.”
    It was shown that J. A. Blumer received the money and deposited it to his individual account. Hoch did not keep an account with the bank. He made a demand on the bank -for the remainder of the bonds or the money and was refused. He then brought this suit. The court (Albright, P. J.), directed the jury to return a verdict in his favor, holding the receipt to- be a deposit. There was a verdict and judgment accordingly, when the bank took this writ and assigned this instruction for error.

      Edward Harvey and R. E. Wright, Jr., for plaintiff in error.—
    The money was received by Mr. Blumer for the special purpose of investment in designated securities. It was not to be the money of the bank; it was not.to be credited to the account of Hoch ; was not to be liable to check ; and all that the paper promises is that bonds will be purchased and only interest is to be paid or accounted . for on demand. In other words, a bailment was created, and all that the bank was to do was to use the money to furnish the bonds. As the word deposit is understood in the commercial world it signifies the paying of money into a bank, which is passed to the credit of the owner and is subject to his draft, check or order: Commercial Bank of Albany v. Hughes, 17 Wend. 94 ; Marine Bank v. Fulton Bank, 2 Wall. 252; F. & M. Nat. Bank v. King, 7 P. F. Smith 202; Foley v. Hill, 2 H. L. 28.
    Again, the paper is an agreement to invest the principal in bonds and to account for interest on demand. Only the interest is to be accounted for on demand. As the principal was to be clothed in city bonds, Hoch could demand these bonds and the interest. If there was a failure or omission to get the bonds he could demand the money, not’upon the paper in evidence, but upon the implied promise to refund it. But if the bank never received the money there was no implied promise to refund it. Hoch also knew that he was not opening a bank account by making a deposit. He was not making the bank his debtor but his agent, and therefore knew that what was done transcended the authority of the president. If he was misled by the act or promise of Blumer, he could not recover from the bank without showing that the act or promise was within the scope of the general usage and course of business of the bank, for it is only in such transactions the corporation is liable: Lloyd v. West Branch Bank, 3 Harris 172.
    The contract was ultra vires of the bank : Shinkle v. First Nat. Bank of Ripley, 22 Ohio St. 516; Fowler v. Scully, 22 P. F. Smith 456; First Nat. Bank v. Ocean Bank, 60 N. Y. 287 ; Wecklin v. First Nat. Bank of Hagerstown, 42 Md. 581; First Nat. Bank of Charlotte v. Exchange Bank, 2 Otto 122; Yenango Nat. Bank v. Taylor, 6 P. F. Smith 14; First Nat. Bank of Rochester v. Pierson, 16 Albany L. J. 319; Wiley v. First Nat. Bank of Brattleboro, 47 Yt. 546.
    It was ultra vires of the president of the bank: Dorsey v. Abrams et al., 4 Norris 299 ; First Nat. Bank v. Ocean Nat. Bank, 60 N. Y. 278; Bank of U. S. v. Dunn, 6 Pet. 51; United States v. Bank of Columbus, 21 Howard 356; Shryock v. Basehore, 1 Norris 159; Lloyd v. West Branch Bank, 3 Harris 174.

      William P. Snyder and John Rupp, for defendant in error.—
    This paper is not merely a contract to buy bonds of the city of Allentown, but it is something more. It is a certificate that Mr. Hoch has deposited in the First National Bank of Allentown, $1000, which, with interest, is to be accounted for on demand. The bank could have discharged it at any time it saw fit, by paying or tendering the money to Mr. Hoch, and' he might have gone to the hank at any time during banking hours and demanded the money.
    Hoch paid the money to an officer of the bank, and if he was in default, and did not make the proper entries in the books of the bank, Hoch is not to be prejudiced thereby. The money having gone into the bank, through its proper officer, it is bound to repay it on demand, in accordance with the terms of deposit.
   Mr. Justice Mercur

delivered the opinion of the court, May 5th 1879.

The plaintiff in error is a national bank. This suit was against the bank, on a receipt signed by the president thereof, in the following words, to-wit:

“$1000. Allentown, Dec. 18th 1875.

Received of Mr. William Hoch, one thousand dollars, to be invested in bonds of the city of Allentown, bearing seven per cent, interest. Interest on the said deposit to be allowed from this date and to be accounted for on demand. W. H. Blumer,

President First Nat. Bank. ”

The defendant in error failing to obtain all the required bonds, or a return of the residue of the money, brought this suit.

The court directed the jury to return a vprdict in his favor.

It is well recognised law, that a national bank is not, by its charter, authorized to act as a broker or agent in the purchase of' bonds and stocks. Its specified powers given by statute, nor its incidental powers necessary to carry on the business of banking, do not extend to the transaction of such business: First Nat. Bank of Charlotte v. Exchange Bank, 2 Otto 122; Fowler v. Scully, 22 P. F. Smith 462. When the paper on its face shows the transaction not to be within the usual course of business of the bank, it is not binding on the bank, although signed by the president thereof, as such officer. He is the executive agent of the board of directors within the ordinary business of the bank, but cannot bind it by a contract outside thereof, without special authority. I do not understand these general rules to be denied. Some of them are expressly admitted, and the others impliedly conceded by the court below, and by the counsel for the defendant in error. The court ruled the case on the construction it gave to the receipt. The learned judge said to the jury, “ The question as to whether the plaintiff is or is not, entitled- to recover in this action, depends upon the construction that is put upon the receipt of December 18th 1875, which has been offered in evidence. It is the duty of the court to construe' this paper. If this were an obligation on the part of the bank to purchase and furnish the plaintiff with the kind of security mentioned in the paper, it would be beyond the power of the bank or its president to enter into that obligation, and the plaintiff would not be entitled to recover. But I construe this paper to mean that it is an acknowledgment that the plaintiff did pay to the president of the defendant $1000, which was treated, according to the terms of the paper, as a deposit, and might be discharged by the bank, either by furnishing the bonds of the city of Allentown, or by repaying the money with interest.”

It was undoubtedly the duty of the court to construe the paper; but we cannot concur in the construction given. The principal object of the contract, clearly shown by the receipt, was the purchase of bonds. That was the specific purpose for which the money was left and received. The language of the receipt assumed that the desired bonds could not then be procured, and to prevent a loss of interest in the meantime, to the defendant in error, the latter clause was added. The primary thought and main intent of the contract was a purchase of bonds. The secondary one was to procure interest until the investment could be made.

While the word deposit” does appear in the receipt, yet it is evidently used as a synonym for money or fund. The receipt does not state that the money is left as in the case of an ordinary deposit; nor that it shall be deposited in bank to his credit; nor was it ever so deposited. It was put in the hands of the city treasurer on the very day of its receipt, presumably for the purpose of getting the city bonds. The bank never received the money. It was never subject to the check drawn by the defendant in error on the bank. Although the transaction was with Blumer, as president of the bank, yet, in all legal aspects, it was with him as an individual. Upon the uncontradicted testimony, the defendant in error was not entitled to recover.

Judgment reversed.


author: Mr. Justice Woodward

text:
    Macungie Savings Bank versus Hottenstein.
    1. The rule that the vicious element in an usurious contract survives in all its transmutations, applies only to cases in which the obligor or promissor remains the same.
    2. For several years H. had endorsed the notes of G. There were various renewals of these notes, when finally the bank discounted the note of H., with B. as endorser, and surrendered to H. all the notes of G. endorsed by II. On all these notes usurious interest was charged and taken. In a suit against II., on his own notes, Held, that H. was' not entitled to defalk the usurious interest paid on the notes of G.
    March 5th 1879.
    Before Sharswood, C. J, Mercur, Gordon, Woodward, Trunkey and Sterrett, JJ. Paxson, J., absent.
    Error to the Court of Common Pleas of Lehigh county: Of January Term 1879, No. 171.

      Assumpsit by the Macungie Savings Bank against Levi S. Hottenstein.
    The facts are stated in the opinion of-this court. The trial was before Albright, P. J. The verdict was for $1624.45. The instruction of the court to the jury to give credit to defendant for the excess of interest paid both by Grim and Hottenstein, was the error assigned by plaintiff, who took this writ.

      Edward Harvey and C. J. Erdman, for plaintiff in error.
    The giving and accepting of the Hottenstein note and the surrender of the Grim notes, were an extinguishment of the debt of Grim : 2 Powers on N. & B. 203: Byles on Bills *307 ; Dennis v. "Williams, 40 Ala. 633; Arnold v. Camp, 12 Johns. 409; Manuel J. Mississippi Railroad Co., 2 Barr 198; Slaymaker v. Gundacker’s Ex’rs. 10 S. & R. 75; Hart v. Boiler, 15 Id. 162. The debt of Grim being thus extinguished Hottenstein could not defalk the usury paid on the Grim notes : Bly v. Second National Bank of Titusville, 29 P. F. Smith 453.

      John Rupp and John E. ■Stiles, for defendant in error.
    As long as the original indebtedness, which is tainted with usury, exists, so long the taint of usury follows it. The original taint of usury attaches to all consecutive obligations or securities growing out of the original vicious transaction, and none of the descendant obligations, however remote, can be free from it if the descent can be traced. Neither the renewal of an old nor the substitution of a new security between, the same parties, can efface the usury, nor a further security, nor a guaranty given subsequently by a stranger. The statute of usury could be very easily evaded, if a security of a third person, taken a few days or a few months after the loan in lieu of the borrower would be valid: Campbell v. Sloan, 12 P. F. Smith 481; Miller v. Irwin, 4 Norris 376; Power v. National Bank of Fair Haven, 35 Leg. Int., No. 19, p. 194; Overholt v. Bank of Mount Pleasant, 1 Norris 490; Kendig v. Linn, 27 Am. Law Reg. N. S. 64; Gardner v. Matteson, 26 Id. 680.
    The giving of a new note, or new and further security, for an antecedent debt, is not a payment and extinguishment of that debt, but the presumption is, that it is taken as merely a collateral security for the original debt. Where a creditor takes from his debtor a note payable at a future day, on account of his claims, this can only be considered as a collateral security: Shaw & Leigh v. The First Associated Presbyterian Church, 3 Wright 226; Weakly v. Bell et al., 9 Watts 273; Bank of Pennsylvania v. Potius, 10 Id. 150; Seltzer v. Coleman, 8 Casey 493; Dougherty v. Hunter, 4 P. F. Smith 380 ; Stone v. Miller, 4 Hands 450 ; Byles on-Bills *381; Hoar v. Clute, 15 Johns. 224;.Bayard v. Shunk, 1 W. & S. 92; McIntyre v. Kennedy, 5 Casey 448.
   Mr. Justice Woodward

delivered the opinion of .the court, May 5th 1879.

•Pour notes drawn by William Grim, one on the 16th of June 1870, and the others on different dates in the year 1872, were discounted by the Macungie Savings Bank. They were renewed from time to time until January 1875. Levi S. Hottenstein, the defendant, was the accommodation endorser of the four notes throughout the period during which they were renewed. At the close of the year 1874, or in the beginning of 1875, negotiations were entered into by the parties which resulted in the discounting by the bank of a note for $2100 drawn by Hottenstein and endorsed by Henry Brobst. The four notes of Grim were given up to Hottenstein, and are in his hands. The new note was renewed at intervals until the 30th of April 1877, when the last of the series on which this suit was brought was given. As part of the transaction, a mortgage by Grim to Hottenstein for $2100 was put in evidence. Hottenstein testified, however, that he had no knowledge of its existence until the following summer. He then took it and holds it now. Usurious interest had been demanded and received by the bank not only on the series of notes drawn by Hottenstein and endorsed by Brobst, but on the series of Grim’s notes, which Hottenstein had endorsed. The jury were instructed on the trial to give credit to the defendant for the excess of interest, paid both by Grim and Hottenstein.

Was the defendant entitled to allowance for the usurious interest Grim had paid ? If the question had been submitted to the jury they could scarcely have failed to find that the. evidence made out a case of novation — the substitution of a new draft for an old one. The bank’s claim against Grim was extinguished when his notes were surrendered to Hottenstein. The new note could not have been received as a collateral security, for there was no surviving debt to secure. The question of merger could not arise, for that takes place only where the debt is one, and the parties to the securities are identical: Jones v. Johnson, 3 W. & S. 276. Throughout the opinion in Campbell v. Sloan, 12 P. F. Smith 481, care was taken to confine the rule that the vicious element in a usurious contract survives in all its transmutations to cases in which the obligor or promisor remains the same. It was said that no payment by a changed form of security can be bona fide “ by the same borrower to the same lender, even though it may be strengthened by the engagement of a new surety or guarantor.” As to all essential points involved in this controversy, the defendant stands in precisely the position in which Andrews stood in Bly v. The Second National Bank of Titusville, 29 P. F. Smith 453. Andrews had been the accommodation endorser of a'series of notes drawn by the Climax Mower and Reaper Company, in the discount and renewal of which the company had paid usurious interest to the bank. In the note in suit, drawn by Andrews and endorsed by Bly, a balance due by the company had been included. Judge Trunkey, then the president of the Common Pleas of Venango, said in entering the judgment: “ On all the loans and discounts Andrews was an accommodation endorser, borrowed no money, paid no interest and has no right of action on account of illegal interest paid by the company.” The judgment was affirmed upon Judge Trunkey’s opinion. Miller v. Irwin, 4 Norris 376, was sent back for a trial because the defendant’s affidavits alleged that she had given the note sued upon in renewal of a note drawn by her deceased father, of whose estate she was executrix; that she had not assumed or intended to assume any personal liability ; and that shewas induced to sign the note by the distinct and positive assurance of the officers of the United Savings Bank, that she would be bound only as executrix. That case rested on its own facts. Nothing contained in it had relevancy to any principle decided in Bly v. The Bank of Titusville, and nothing in it has relevancy to any principle requiring determination here.

Judgment reversed, and venire facias de novo awarded.