text:
    Shellhammer et al. versus Ashbaugh.
    1. To take a parol gift or sale of land between father and son out of the operation of the Statute of Frauds the evidence thereof must be direct, express and unambiguous, its terms must be clearly defined, and all the acts necessary to its validity must have special reference to it and nothing else.
    2. Where title to land is asserted under an alleged parol purchase, to take the contract out of the operation of the Statute of Frauds it must be supported by adequate evidence of an existing consideration, an adjustment of the boundaries of the land, and of the change of possession which the law requires.
    October 23d 1876.
    Before Agnew, C. J., Sharswood, Mercur, Gordon, PAXSONand Woodward, JJ. Williams, J., absent.
    Error to the Court of Common Pleas of Armstrong county: Of October and November Term 1875, No. 201.

      Ejectment by Josiah Shellhammer and others against John B. Ashbaugh for 50 acres of land.
    William Ashbaugh, deceased, died in March 1873, intestate, leaving surviving him a widow, Susan Ashbaugh, and nine children, viz : Anna, wife of Jacob Shellhammer; Elizabeth, wife of Charles Winel; Susan, wife of Josiah Shellhammer; Sarah, wife of Michael Shutt; Levina, wife of Joseph Smail; Caroline, wife of Isaiah Klingensmith; Mary, wife of George' Biggie and Catharine Ashbaugh, the plaintiffs, and John B. Ashbaugh, the defendant. Said decedent was in his lifetime, seised of a piece of land on which he resided, situated in Burrel township, Armstrong county, Pennsylvania, and containing about 121 acres. After his death his daughters presented to the Orphans’ Court of said county a petition for partition of said land, whereupon inquest was awarded. At or before the return of the inquisition, John B. Ashbaugh appeared and filed an affidavit, claiming to hold in severalty fifty acres of said land, and denying that the decedent died seised of said fifty acres. Further proceedings in the partition were then stayed, and the Orphans’ Court directed the bringing of this ejectment to determine the title in severalty set up by John B. Ashbaugh.
    At the trial defendant claimed the fifty acres of land, by virtue of a parol gift or sale of the same to him by William Ashbaugh, and in support of this alleged parol title the material evidence was the testimony of George Knepshell, which will be found set forth in full in the opinion of this court. The remaining evidence in the cause is .also substantially produced in the opinion.
    The plaintiffs presented this point to the court:—
    “That taking the whole evidence given by the defendant and the legitimate inferences fairly deducible from it, the defendant has failed to establish such a contract as takes the case out of the Statute of Frauds and Perjuries, and the plaintiffs are entitled to recover the eight undivided ninth parts of the land in dispute.”
    The court answered: “We leave the question to you and the point is refused.”
    In the general charge the court (Logan, P. J.), after a reference to the cases of Eckert v. Mace, 3 Penna. R. 365; Poorman v. Kilgore, 2 Casey 365, and Taylor v. Henderson, 2 Wright 60, continued:—
    “ We have been asked to say that taking the testimony all together a parol contract with this definition has not been established. Were it not for the testimony of George Knepshell (the only witness who brings the parties, father and son, face to face at the making of a contract as we recall the testimony), wre should so instruct you. The testimony of this witness, however, taken in connection with all the other testimony in this cause, invites the submission of the question to you. It is for you then to say whether under all the evidence in this cause you are clearly and fully satisfied that a contract, direct, positive, express and unambiguous, with its terms and conditions clearly defined, was entered into by this father and son; and this established by a witness who brought them face to face. That in consideration of previous service rendered the father by the son, in working on the farm and boating, the former agreed to give the land to his son, not for a temporary purpose, but absolutely, and to go on and build upon and improve it, and the son thus accepted the grant. That thereupon the son entered into exclusive possession of the land, held it as his own, and erected buildings and made valuable improvements thereon which could not be compensated in damages. This all clearly and satisfactorily' established, the case would be taken out of the Statute of Frauds and your verdict should be for the defendant, otherwise your verdict should be for the plaintiffs for the undivided eight-ninths.
    “ In addition to the controversy about the fact of this alleged contract, it is also a gravely-contested fact whether or not there was such possession taken under the contract, if made, as would be sufficient to take the case out of the Statute of Frauds. As we have seen, taking possession under the contract is essential to the validity of a parol contract. As to this we instruct you that, [if the defendant had gone into possession of the fifty acre tract before the parol contract — if there was such contract — and was in possession of it severally before, and independent of the contract, then this case would be taken out- of the Statute of Frauds.
    “ But if J ohn was jointly with his father in possession of the entire farm before the contract, and upon making thereof went into separate possession of these fifty acres, the land in dispute, pursuant to the contract, and continued to hold it separately, and apart and distinct from, the remaining part of the land, it would constitute a sufficient possession.] If, however, John simply continued, after as before the alleged contract, to hold the fifty acres in common with a tenancy of the entire farm, then it would not be such possession as would take the case out of the Statute of Frauds, even if the evidence established the fact of the contract.
    “ It is also proper to remark that you must be satisfied that the contract was an actual sale, in order to entitle the defendant to your verdict.
    “If on the father’s part it was only the declaration of an intended purpose, something he meant to, do, but did not in fact do, it would not be sufficient to entitle the defendant to your verdict.”
    The verdict was for the defendant.
    The plaintiffs took this writ and, inter aha, assigned for error the refusal of plaintiffs’ point and the portion of the charge in brackets.

      Jacob Freetly and J. Gtilpin, for plaintiffs in error.
    — The evidence was not so positive, clear, definite and satisfactory as to justify its submission to tbe jury: Poorman v. Kilgore, 2 Casey 372; Irwin v. Irwin, 10 Id. 525; Overmyer v. Koerner, 2 Weekly Notes 7 ; Moore v. Small, 7 Harris 469.
    To take a parol contract for the sale of land out of the operation of the Statute of Frauds: 1. The contracting parties must be brought face to face; 2. The land must be clearly designated; 3. Open, notorious and exclusive possession must be taken and maintained under the contract; 4. The evidence must be clear, direct, positive and unambiguous; 5. There must have been such part performance as cannot be compensated in damages : Moore v. Small, 7 Harris 469; Postlethwait v. Frease, 7 Casey 472; McKowen v. McDonald, 7 Wright 441; Overmyer v. Koerner, 2 Weekly Notes 7. A parol contract for the sale of land will not be taken out of the statute by a possession not delivered under the contract, as where the purchaser was in possession when the contract was made: Myers v. Byerly, 9 Wright 368. A tenant in possession cannot buy from his landlord by parol: Hill v. Myers, 7 Wright 172; McKowen v. McDonald, supra; Christy v. Barnhart, 2 Harris 261.
    Clearing and fencing land, erecting farm buildings, planting an orchard, &c., by the son in pursuance of his parol contract, were such improvements as could be appraised and compensated in damages, and would not therefore take the case out of the operation of the statute: Cox v. Cox, 2 Casey 383 ; Toe v. Toe, 3 Grant 74; Blakslee v. Blakslee, 10 Harris 237; Overmyer v. Koerner, supra ; McKowen v. McDonald, supra.

      Golden and Painter, for defendant in error.
    — This case was not within the Statute of Frauds : Milliken v. Dravo, 17 P. F. Smith 230; Moss v. Culver, 14 Id. 414; Hugus v. Walker, 2 Jones 175; Collins v. Collins, 2 Grant 117; McGibbeny v. Burmaster, 3 P. F. Smith 332.
    It would be inequitable to rescind a parol contract of sale in which the terms, the subject, its boundaries and quantity were precise, and possession was taken in pursuance of it, and valuable improvements made: Syler v. Eckhart, 1 Binn. 378; Eckert v. Eckert, 3 Penna. R. 362.
   Mr. Justice Woodward

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

The third error was improvidently assigned. By a clerical error in copying the charge, the court were made to say: “If the defendant had gone into possession of the fifty acre tract before the parol contract, if there was such a contract, and was in possession of it, severally and independent of the contract, then this case would be taken out of the Statute of Frauds.” Of course no such instruction could have fallen from the lips of a judge so accurate as the President of the Common Pleas, and po official certificate was necessary to prove that the word “not” had been inadvertently omitted in the concluding clause of the sentence, by the clerk who transcribed the charge.

This contest has arisen out of a parol contract alleged to have been made betweén a father and a son. In such a contest, it was said in Ackerman v. Fisher, 7 P. F. Smith 457, clearer and stronger evidence is required of the father’s intention to part with the ownership of property, than is required in cases of parol contracts between strangers in blood. There are' obvious reasons for this distinction. The circumstances of families are subject to constant change. The pecuniary relations between a father and his several children may shift not only from year to year, but from month to month. The promise to give an estate to a child- may have been founded on reasons involving anticipations never realized or plans never executed. Financial embarrassments, an increase in the number of the members of his family, the intervention of new duties, or the misconduct of the child may justify a change in the father’s purpose. In any such case there would be manifest injustice in imputing to loose declarations of intention the binding efficacy of a contract. “ Nothing is more common,” Judge STRONG, said in Ackerman v. Fisher, “ than that a father speaks of a farm on which he has placed a son, as the son’s farm, or a house in which he permits his son to live, as the son’s house. It is every day’s occurrence that a father speaks of having given a lot óf ground to a son, when it ivas plain there was no intention to transfer the ownership. And such language is not confined to parol gifts. When a father says, I sold such a piece of real estate to my son, he generally means no more than that he agreed the son might have it for a consideration.” The rule is settled, therefore, that' as between father and child, the evidence of a gift or sale must be direct, positive, express and unambiguous; that its terms must be clearly defined, and that all the acts necessary to its validity must have special reference to it and nothing else: Poorman v. Kilgore, 2 Casey 365. In Moore v. Small, 7 Harris 461, it was ruled that to have effect the contract must have .been so far executed as to make it unjust to rescind it, and must be so definite in its terms as to enable á court of equity to decree its. specific performance. In that case a son set up a parol gift from his father, and the improvements the son had made, were relied on to take the contract out of the operation of the Statute of Frauds. It was said that the son, like any other purchaser, must prove the contract; must prove that the land was clearly designated; that open, notorious and exclusive possession was taken and maintained under and in pursuance' of the contract; and that the improvements which constituted the consideration were made on the faith of the promised conveyance.

Tried by these rules, the testimony of George Knepshell, under which the court below felt obliged to submit the decision of the cause to the jury, utterly failed to establish the elements of a valid contract. He said that in March 1860, he was on the land in dispute where William Ashbaugh, the father, and John Ashbaugh,-the defendant, were working on the house in which John now lives. He worked with them during an afternoon. He described what occurred in these words : William Ashbaugh told me as we were going across the fields that he would give John fifty acres, and when we got up to the fence, we sat on it, and he said this fence was to be the line'until they would get matters fixed up and the land paid for. He said the land north of the fence was to be John’s ; said he had given it to John ; said John was the only child that helped him to boat and make money, and he must give him a compensation ; that he had no other way. He said he was helping John to put up the house. William Ashbaugh told Henry Ashbaugh and me in 1866 that he had given John the fifty acres, the Wightly tract that he and John had bought. He said John helped him to build his barn, and when he got things fixed he would run the line and make him a title. John was not present at the whole of this last conversation. He was present at the first conversation, but said nothing. The old man and John talked about this contract among themselves. At the time we were working at the house the old man said John could build the house and improve and use it as he pleased; he had given it to him as his own, and he could .use it as his own. John had lived there since 1860, and claimed it as his. John claimed the ownership of fifty acres, and farmed down to the fence. John and his father talked of the extent of the boundary.” The witness added on cross-examination : “ John raised crops on old piece after; farmed on other parts of old place after that, and had before that;' can’t tell how they farmed. John and his father worked at the house the day I was there; did not say when he had given John the place; said John had helped him to buy the Wightly place, and he had given it to John to compensate him.” In all this where is there proof of a contract of which specific performance could be decreed? What constituted the consideration ? In 1860 William' Ashbaugh said John had helped him to boat and make money. In 1866 he said he had given him the Wightly tract which he and John had bought because John had helped him to build his barn. It may be from the concluding sentence of Mr. Knepshell’s testimony that the fact that John had helped to buy-the Wightly tract Avas stated in 1860 to be one of the reasons for the gift. But the evidence does not show any amount that Avas advanced or the value of any services that Avere rendered. And it does not show that any debt was due to John. For all that appears, the statements of the father may have been the expression of an intention to make a voluntary conveyance of the land in compensation for voluntary services of the son. The boundaries of the tract were not designated. The fence was a temporary line, and the location of the fifty 'acres was to be ascertained by a survey to be subsequently made. The testimony as to possession was equally indefinite and defective. The defendant had farmed the whole tract for his father, including the fifty acres, before the conversation in March 1860 was had. So far as the statements of the witness throw light on the subject, he continued to farm it in the same way afterwards. It is true he moved into the new house, but nothing indicates that any change whatever was made in his possession of the land or in his relations with his father in consequence of the conversation which is relied on to establish the contract

By. the other evidence given on behalf of the defendant, his claim is stripped of 'every semblance of plausibility. So lately as 1867 or 1868, William Ashbaugh told David Beck that “ he would give John the fifty acres, providing he did not do as some of the rest of the heirs, go against him.” It is clear from the testimony of Mr. Beck and Michael Sproul that the defendant worked the fifty acres as well as the rest of the farm, after he moved into the new house, as he had done before. Beck said: “ William Ashbaugh told me John was living there to crop for him over the whole farm. He cropped both pieces for the old man.” Sproul said: “I know that John did his farming up till and before that time (1869). He gave the old man two-thirds of what he raised on the whole farm. ’ ’ James Zill testified that four or five years before he was examined, he helped to build fences on the fifty acre piece, and William Ashbaugh paid him. With the exception of the amount with which William Linden charged him for twenty-five peach trees, there was no evidence of the expenditure by the defendant of a single dollar for the improvement of the property. For the peach trees he bought and for the labor he performed he could be amply compensated in damages. It is certain that in view of the Statute of Frauds, no contract has been established under which he can assert title to this property, for the case is destitute of adequate evidence of an existing consideration, of an adjustment of the boundaries of the land, and of the change of possession which the law requires. The first point presented by the plaintiffs covered the whole ground of this controversy, and ought to have been affirmed.

Judgment reversed, and venire facias de novo awarded.


source: Caselaw Access Project

author: Mr. Justice Gordon

license: Public Domain

text:
    Colwell versus Easley.
    1. In proceedings on a scire fapias to revive a judgment, where one is brought into court who has had no connection with the debtor’s title, he should be discharged either by nonsuit or a verdict in his favor.
    2. If he has had any connection with the debtor’s title, though the judgment may not have been a lien at the time of his purchase, by reason of its previous expiration, he may nevertheless be brought into court as a terre-tenant, and may defend under the plea that the judgment is not and never was a lien upon his land.
    3. In a scire facias to revive the lien of a judgment, 0., who was summoned as a terre-tenant, pleaded that the original judgment was not a lien on his lands and never had been. Held (reversing the court below), that this was a good plea, and that striking off such a plea was erroneous.
    October 24th 1876.
    Before Agnew, 0. J., Sharswood, Mercur, Gordon, Paxson and Woodward, JJ. Williams, J., absent..
    Error to the Court of Common Pleas of Armstrong county: Of October and November Term 1876, No. 140.

      W. L. Corbert and J. V. Painter, for the plaintiff in error.

      J. Gilpin and E. S. Golden, for the defendant in error.
    The sheriff’s return to the scire facias is merely that he has made known the writ to certain persons, but does not describe the lands held by them. The short entry of judgment is construed to relate only to the lands in the possession of those served which were bound by the original judgment: Coyle v. Reynolds, 7 S. & R. 329.
    In Mitchell v. Hamilton, 8 Barr 486, which expressly overrules Minier v. Saltmarsh, 5 Watts 293, it was held that a tenant in possession cannot, when summoned as a terre-tenant, say that the land was not bound by the judgment. To the same effect is Dengler v. Kiehner, 1 Harris 38, Avhich decides that a terre-tenant can only show a release or a discharge of the land from the lien of the judgment. To the same effect are Haskins v. Low, 5 Harris 66; Drum v. Kelly, 10 Casey 417 ; Catlin v. Robinson, 2 Watts 373; Cahoon v. Hollenback, 16 S. & R. 432.
    In Colborn v. Trimpey, 12 Casey 465, Rhoads was. concluded by a judgment against him by default. This case cannot be held to have overruled Mitchell v. Hamilton or Dengler v. Kiehner.
    Aside from authority, to alloAV such a plea would be to make this an action to try the title to land.
   Mr. Justice Gordon

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

The case for consideration has its origin in this wise: James Easley issued a writ of scire facias on a judgment which he had obtained against Hugh Campbell and R. S. Connor, and caused John A. ColAYell to be named as terre-tenant. Colwell caused appearance to be entered in his own behalf, and put in certain pleas, among others, that “ The judgment sought to be revived by scire facias is no lien on the lands of J. A. Colwell, and never was.” The case came on for trial March 14th 1876, when, before jury called, Hugh Campbell confessed judgment, and the trial proceeded as to the terre-tenant until the 18th, when a motion ivas made by the plaintiff to strike off the pleas of John A. Colwell, and to enter judgment for the plaintiff for want of a plea. This motion was granted — the plea was stricken off, and the defendant was ordered to plead over instanter, unless he should ask further time; whereupon he made answer that he had no further plea and asked no further time. The court then discharged the jury, and entered “judgment de tenis against J. A. Colwell, the' defendant, and de propriis as to costs.” In the order striking off these pleas and the entry of judgment, the court no doubt intended to follow the case of Haskins v. Low, 5 Harris 64. So far as the disposition of the pleas was concerned, no doubt the learned judge was supported by the ruling in that case ; for it is therein said by Hibson, 0. J., that a plea that the judgment was no lien and never had been, was bad, and might have been avoided by a demurrer. As to the judgment, however, we think it is stretching that case a little too much to attempt to make it cover this part of the court’s • action. The parties in the case referred to had actually proceeded on that plea to trial, and judgment had been rendered against the terre-tenant. He had been permitted to make all the defence in his power, and he had failed to show that the judgment was- no lien. The land, thus bound by the judgment, ivas sold on a vend ex.; the proceeds were sufficient to satisfy the debt, but not all the costs; a fi. fa. was issued, on leave of court, against the terre-tenant for the balance of these costs; and it was upon this execution that the case was brought into this court. The decision was put upon the ground that, in Pennsylvania, we tax cost on every scire facias, as though it were an original suit, such practice having been sanctioned in Wood v. Ludwig, 5 S. & R. 446. In the'case in hand there was no trial and verdict, but the defendant was turned out of court because his pleas ■ denied that he was a terre-tenant of the land bound by the judgment. It was held, in the case cited, that no one can lie a terre-tenant whose land is not bound, and consequently such an one cannot plead as a terre-tenant. If the land was never bound by the judgment, he has nothing to do with the question of execution between the creditor and his debtor. Rut we may observe, from this case, that he whose, land is not bound by the judgment cannot interpose a defence, though brought into the ease by scire facias, because he has no interest in the result. If, however, judgment may be had against him for costs, is he not interested ? and if so, why may he not make the only defence possible, to wit, that his land is not bound by the plaintiff’s judgment ? John A. Colwell is brought into court by the plaintiff’s writ; he does what he can to defend himself, but his only possible plea is stricken off and he is saddled with the costs !. This cannot be good law, for it is contrary to the dictates of justice.

We think much the better rule to be that laid down in Jarrettu. Tomlinson, 3 W. & S. 114, and Miltenberger v. Schlegel, 7 Barr 241, that where parties are improperly introduced as terre-tenants the jury may be discharged as to them, or a verdict may be directed in their favor. We think, also, that the court erred in striking off the plea that the plaintiff’s judgment was not and never .had been a lien on the lands of Colwell. It is true a contrary doctrine may be gathered from the case already referred to, as well as the cases of Chahoon v. Hollenback, 16 S. & R. 426, and Dengler v. Kiehner, 1 Harris 38. The opinions in these cases were by Chief Justice Gibson, as was also that in Mitchell v. Hamilton, 8 Barr 486, by which Minier v. Saltmarsh was overruled. In Dengler v. Kiehner, the point was, that though the land had been bound by the judgment, yet, as the lien had expired previously to the purchase of the land by Dengler’s ancestor, it was held he was not a terre-tenant, and hence, though he had been served with the scire facias, the judgment thereon did not conclude him. It is, however, difficult to reconcile this doctrine with 0. J. Gibson’s opinions as found in some 'other cases. In Himes v. Jacobs, 1 Penna. R. 162, the court below held: “ That John Ross died before the 6th of April 1805, and that no suit was brought upon the bond from John Ross to Isaac and Abraham Boyer, or any description of it filed in the prothonotary’s office within seven years after the death of John Ross; and that consequently as against a bond, fide purchaser, which Anthony Deardorff was, the lien of that debt was gone before suit brought, and that Deardorff was not estopped by the pleadings and proceedings in the suit which was brought on that bond in 1823, from denying the existence of that lien and its effect in this action.”

On this point the court below was reversed, Gibson, C. J., observing in the opinion delivered by him, that though, as against a terre-tenant, the question might be tried in an action of ejectment by the sheriff’s vendee, yet when he had appeared in the proceedings on the original judgment, and had an opportunity to make a full defence, even though he may not avail himself of it, he is concluded to every intent. Here then is a case as near the converse of Dengler v. Kiehner as can well be imagined. Here, also, is a case in which the only possible defence of the one served as terretenant, was that his land was not and never had been bound by the debt sought to be recovered, and yet, because he did not make this very defence, when he might have done so, he is held to be concluded. So in Mitchell v. Hamilton that same eminent jurist says, that on the trial of the scire facias the terre-tenant may show that the debtor had parted with his title before the rendition of the judgment, or that the lien had been extinguished by a satisfaction, release or want of revival. Here, again, we are warranted in saying that a plea, by one summoned as a terre-tenant, that his land was not and never had been bound by the judgment, would be good. Then in addition to the overruled cases of Kiehner v. Dengler, 1 Watts 424, and Minier v. Saltmarsh, 5 Id. 293, we have Colborn v. Trimpey, 12 Casey 465, in which Woodward, J., says that it would have been a good plea, by one served with a scire facias, that he was not a terretenant and that his land was not subject to the lien, and that if he did not avail himself of such opportunity he was estopped from gainsaying the validity of such lien, in an action of ejectment to recover the land. From the reasoning thus borrowed from our books we are led to conclude, 1. That when one is brought into court, who has had no connection with the debtor’s title, he should be discharged either by nonsuit or a verdict in his favor ; for he is not a terretenant ; he cannot be bound by the judgment and he ought not to have been summoned; 2. If he has had connection with the debtor’s title, though the lien of the judgment may not have attached at the time of his purchase by reason of its previous expiration, he may nevertheless be warned as a terre-tenant, and may defend under the plea that the judgment is not and never was a lien upon his land. It follows that the court erred in striking out the second plea of the defendant. As to the third and fourth pleas they were mere surplusage and amounted to nothing pro or eon.

Judgment reversed, and & procedendo awarded.


author: Per Curiam.

text:
    Morris, for use of Rupp, versus McCulloch.
    An assignment of a debt carries with it all the remedies and securities which the assignor had, but does not include a personal right of action founded on a tort which the assignor had against a third party, although arising from the same subject-matter.
    October 24th 1876.
    Before Agnew, C. J., Sharswood, Merour, Gordon, Paxson and Woodward, JJ. Williams, J., absent.
    Error to the Court of Common Pleas of Armstrong county : Of October and November Term 1876, No. 170.
    This was an action on the case, brought in the name of Robert Morris, for the use of F. J. Rupp, against James A. McCulloch, to recover the amount of a judgment entered in the Common Pleas of Armstrong county.
    The facts were these: On the 21st of May 1857, Robert Morris sold to John Moyer certain real -estate in Freeport, and took from Moyer a judgment-bond as security for the unpaid purchase-money. This bond was given to McCulloch, as -attorney for Morris, to enter judgment thereon. McCullough filed a narr. and entered judgment upon the bond on the 11th of July 1857 ; but the narr. was filed and the judgment entered against Jacob .instead of John Moyer, the obligee in the bond. The bond Avas payable in instalments, and the first instalment, which fell due May 21st 1858, Avas assigned by Morris to Rupp, and paid by the defendant, John Moyer, at maturity. The instalments due on the bond in 1859 and 1860 were sold by Morris to John M. Orr, who subsequently assigned them to Rupp ; but before they had matured the property of Moyer was sold by the sheriff and the funds referred to an auditor for distribution.
    The judgment of Morris would have been the first lien on this fund, had it been properly entered; but the auditor held that, OAving to the mistake made by the attorney in the entry of the name, there was no notice to subsequent creditors, and that the judgment could not be treated as a lien, and therefore aAvarded the fund to the subsequent judgment-creditors ; Avhich a.Avard the court afterwards confirmed.
    Rupp then brought this action on the 12th of May 1863, to recover from McCullough the amount thus lost; and the jury AYere SAYorn, and the action proceeded to trial in the name of Morris for use of Rupp, Morris being present as a Avitness in the cause.
    At the trial the defendant offered in evidence a deposition of Morris, wherein he stated that he had not been injured by the alleged negligence of defendant, and that the present action AYas not brought by his direction nor at his instance. This deposition, under objection, was admitted.
    About the close of the trial a paper, signed by Morris, was produced and offered, wherein he disclaimed all interest in the case, and so far as he Avas concerned requested its discontinuance, as it AYas instituted Avithout his authority and Avithout consultation by the assignee. This paper, under objection, was also admitted in evidence.
    The court, Boggs, P. J., charged the jury :—

      “ The narr. mentioned and referred to in the declaration in this suit was filed July 10th 1857. That declaration shoAvs the entry of a* judgment in favor of Robert Morris against Jacob Moyer, and the use party, plaintiff, contends that the defendant here was the Slaintiff’s attorney who dreAY up and filed that narr., and that in so oing he AYas guilty of negligence, and entered judgment against Jacob Moyer, when the bond was the bond of John Moyer, and Avhen the judgment should have been entered against him instead of Jacob Moyer. The defendant denies this allegation, and that forms the first question for your consideration. If you find from the evidence that this allegation is true, then the defendant becomes liable to Robert Morris for negligence, and for whatever amount of damages he actually sustained by reason of such negligence. The ground of the action is negligence, and damages the result. Robert Morris could recover such damages in his own name as legal plaintiff, and so too if he assigned his damages, if any he sustained, with the cause of action, to E. J. Rupp. In that case the plaintiff could recover by using the name of the legal plaintiff, Robert Morris, for his use, as this suit is brought. But if Robert Morris ever had a cause of action, but did not wish to sue for the same, and did not sue therefor, no outside or other person could bring suit in his name for him, especially when he dissents and refuses to sue, unless, as already remarked, he had assigned his cause of action and damages. There is no evidence in this cause that Robert Morris ever assigned to E- J- Rupp, the use party, his cause of action and damages, if he had any. The cause of action accruing to Robert Morris was founded in tort, and he might waive his rights as to the tort and refuse to assign the same. And I think the law will not infer the assignment of a cause of action for such tort, and therefore instruct you that the written assignment of part of the judgment by Robert Morris, given in evidence, did not convey with it any cause of action or damages Robert Morris may have sustained by reason of the defendant’s negligence, and therefore the use party, plaintiff, cannot recover in this suit. And if you find, from the evidence in the cause, that Robert Morris did not institute this suit, nor authorize it to he brought, and claims no interest in it, then there can be no recovery in this case, and your verdict should be for the defendant.”
    The verdict was found accordingly, and plaintiff took this writ, and among other assignments of error were one to the admission of the foregoing evidence, and one to the charge of the court, which are the only assignments passed upon by this court.

      JE. S. Qolden, for plaintiff in error.
    The question raised upon this record may be stated thus: Has the assignee of a judgment, lost through the admitted negligence of the attorney who entered it of record, no remedy as against the attorney? Eor if the right, of action or remedy against the attorney is at the courtesy of the assignor, who has received his money from the assignee without any guarantee and has 'therefore no interest in the matter, or, what may be the case, is under the control of the attorney whose conduct -produced the loss, practically the assignee is without remedy.
    The ordinary rule is that the assignment of a debt carries with it all the remedies which the assignor has for its collection, and it will scarcely admit of a doubt that the assignor has a remedy against the attorney through whose negligence the debt failed of collection from the original debtor.
    The idea that the action of the assignee was in tort apparently controlled the court below. It is true the action of the attorney is a tort in the sense of a wrongful act; the tort is, however, not actual but constructive, springing as it does from a violation of the contract relation existing between attorney and client.
    Though the action may be in form as for a tort, yet if the subject of it be based on contract, the suit will be attended by all the incidents of an action ex contractu, the most important of which incidents certainly is, in this case, the transfer of the assignor’s remedy against the attorney to the assignee of the debt: Livingston v. Cox, 6 Barr 362 ; Wilt v. Welsh, 6 Watts 10.

      J. Gfiljpin and J. V. Painter, for defendant in error.
    The summons here is in case, the action for negligence; the declaration is not based on contract, nor does it set forth any special contract between Morris and McCulloch; it has none of the necessary incidents of a contract; the plea is not guilty, so that in its inception and all necessary steps to issue, it is an action of tort, and must be governed by the rules governing actions of tort. It is contended therefore that the rule of Livingstone v. Cox, 6 Barr 362, does not apply to this case.
    A personal right of action for a tort is not assignable, 2 Tr. & H. Pract. 149, Clowes v. Hawley, 12 Johns 484; North v. Turner, 9 S. & R. 244; McFadden v. Johnson, 22 P. F. Smith 335; Baldwin v. Cash, 7 W. & S. 425; Gardner v. Adams, 12 Wend. 297; Pulver v. Harris, 52 N. Y. 73; s. c. 62 Barb. 500; Mackey v. Mackey, 43 Barb. 58; Zabriskie v. Smith, 13 N. Y. 322.
   The judgment of the Supreme Court was entered October 30th 1876,

Per Curiam.

The matter in issue in this case was the alleged negligence of the defendant, whereby the plaintiff lost the lien of his judgment upon the real estate of John Moyer. It was therefore very irregular to introduce into the trial of the cause a question whether the plaintiff’s right of action passed over to Rupp, the assignee of the judgment. It was an entire departure from the issue. So the introduction of the testimony of the plaintiff and his written disclaimer of his interest in the suit before the jury to defeat the action, was equally irregular. But it would be useless to reverse the judgment and send it back for a new trial, when the right of Rupp to maintain the action cannot be sustained, and when the plaintiff can prevent a trial by a retraxit or a discontinuance. It is not pretended that the plaintiff in fact assigned his right of action against McCulloch for negligence to Rupp. It is only claimed that it passed to Rupp by the effect of the assignment of the judgment against John Moyer. But this assignment carried with it only securities, if any, held to secure payment of the debt. A right of action founded on negligence of the attorney prior to the assignment, was a matter independent of the debt assigned, founded in alleged wrongful conduct, whereby the plaintiff was injured; and was not a security held for the payment of the debt. Collaterals held as security pass in equity by the assignment, though not named; but a party is not bound to enforce a remedy for a wrong or injury done to him, though it relate to the matter assigned. Here the plaintiff in the judgment, Morris, assigned a judgment against John Moyer, to Rupp, when in point of fact he had none, his judgment being against Jacob Moyer. This might raise a question between him and Rupp, but was not an equitable assignment of his right of action against McCulloch.

Judgment affirmed.


text:
    Shumate versus McGarity.
    1. The widow of McGarity, who died before the Act of 14th April 1851, took out letters of administration on his estate, and about fourteen years after her husband’s death had his real estate appraised and set apart to her as widow under that act: Held, in ejectment on her title, that the Orphans’ Court had no jurisdiction, and that she took no title.
    . 2. In ejectment brought by the widow upon her title acquired under these proaeedings in the Orphans’ Court, the court below charged that although the proceedings in the Orphans’ Court had been instituted under the Act of 14th April 1851, yet that might have been merely a clerical error and they might be considered as held under the Act of 26th April 1850, and therefore if the jury found that McGarity was insolvent when he died, they should find for the plaintiff: Held, to be error, and that the widow’s title must depend entirely upon the act under which the proceedings to acquire it were instituted.
    October 24th 1876.
    Before Agnew, C. J., Sharswood, Mercur, Gordon, Paxson and Woodward, JJ. Williams, J., absent.
    Error to the Court of Common Pleas of Cambria county: Of October and November Term 1876, No. 45.
    Ejectment by Elizabeth McGarity against James Shumate. Both parties claimed title under John McGarity, the plaintiff as his widow, and the defendant as the husb.and of his only child. McGarity died intestate on April 5th 1851; The plaintiff, his widow, immediately took out letters of administration on his estate. In 1865, after his estate had been settled, the widow procured an appraisement of the real estate in question under the Act of April 14th 1851; this appraisement (at $>250) was presented to the proper court more than a year afterwards, and approved by it on June 6th 1866, and the property was set apart to the .plaintiff herein; in 1874 she brought this action upon the title so acquired.
    The court below (Dean, P. J.) charged the jury that the rights of the plaintiff depended upon the Act of 26th April 1850, which was in force at the time of the death of McGarity; that although the appraisement in the Orphans’ Court purported to have been made under the Act of 14th April 1851, that may have been an error of the scrivener, and that if the jury believed from the evidenee that McGarity was insolvent when he died, the verdict should be for the plaintiff. The jury so found, and after judgment thereon, the defendant took this writ of error.

      John P. Linton (with him W. S. Sechler), for the plaintiff in error.

      R. L. Johnston, for the defendant in error.
   Mr. Justice Gordon

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

John McGarity, the husband of the plaintiff below, and father'of Mary E., wife of the defendant (plaintiff in error), died April 5th 1851. On the 10th of the same month, letters of administration were issued to Elizabeth, the widow, who proceeded in due course to settle the estate. For the period of fourteen years she laid by, and made no motion towards having set apart for her own use the widow’s allowance under the Act of 1850. On the 7th of June 1865, however, she caused the property in dispute to be appraised. By the appraisement so directed, which was confirmed by the court, June 1866, the premises in controversy were set apart for her use. Were this an appeal from the decree of the court above stated we would not hesitate to reverse it at once, for after so great a length of time the presumption of a waiver, in favor of the heir, would be treated as conclusive. The case, however, as it is presented to us, involves this action of the Orphans’ Court only collaterally, and if it be conceded that that court had jurisdiction, its decree cannot now be questioned. True it is, that in the case of Burke v. Gleason, 10 Wright 297, such a decree was held of no validity in an ejectment by an heir of the decedent against those claiming under the widow. This decision seems to have been rested upon a kind of mixture or combination of two reasons: (1.) That she had not asserted her right in time, seven years having elapsed from the death of her husband, before she procured the appraisement to be made; (2.) That in the meantime she had re-married and was not, in consequence thereof, a widow within the contemplation of the Act of 1851. We are very much inclined to doubt the soundness of the conclusion at which the court arrived in the above case. The question was one of jurisdiction in the Orphans’ Court, and we cannot see how the mere lapse of time, could oust that jurisdiction in the case of a widow’s allowance, any more than for like cause, the jurisdiction of the Common Pleas could be ousted in an action of ejectment. In either case it might be conceded that a decree or judgment for the claimant after the lapse of a great length of time, would be wrong, but the correction thereof could not be had in a collateral proceeding, but only by appeal or writ of error. So the widow’s right to have $300, out of her deceased husband’s estate, notwithstanding her re-marriage may intervene,; seems to be taken for granted in the ease of the Commonwealth v. Powell, 1 P. F. Smith 438. However this may be, the case of Burke v. Gleason is not in point'with the one now under consideration, for here there is no second, marriage: the plaintiff still continues to be the widow of John McGarity, and, upon the mere ground of lapse of time, we cannot consent to impeach the jurisdiction of the Orphans’ Court.

But it might well be presumed, after so great a length of time as fourteen years, that the widow had no right, under the Act of 1850, because of the solvency of the husband’s estate, and it is in perfect keeping with such a presumption, that she does not found her claim on that act, but upon the Act of 1851. Under this statute, however, she had no right, for McGarity died before it was approved.

It follows, that as Mrs. McG-arity had no right, the Orphans’ Court could confer none upon her, and that the decree was without authority and void. To meet this difficulty, and notwithstanding the presumption of which we have spoken, the learned judge permitted the plaintiff to prove the insolvency of the estate, in order to establish her right under the Act of 1850. This might have been permissible in the Orphans’ Court, before decree, on a motion to amend, or to have a .re-appraisement, but, as the records of that court show affirmatively that the appraisement was had under the Act of 1851, we cannot see how the matter was helped by the introduction of proof to show that she might have claimed under the Act of 1850; for the fact still remained that the very records, on which the plaintiff depended for her title, showed that the proceedings were had under a law that gave her no right.

Judgment reversed and a new venire ordered.


author: Mr. Justice Woodward

text:
    Wharton versus Duncan.
    1. W., to procure a line of discount for the firm of which he and his brother were the members, executed to a bank a mortgage of his individual real estate. The secui'ity of this mortgage being deemed insufficient, the mother of W. executed a mortgage of her real estate to provide further protection to the bank. The condition of each mortgage was to secure the payment of the notes to be discounted for the firm to an amount not to exceed $25,000. Notes to the amount of $20,000 being held by the bank, on the payment of $10,000 by W. his mortgage was satisfied without the knowledge of his mother, and the firm having subsequently failed suit was then brought by the bank on her mortgage to recover the amount of the residue of the notes unpaid. Held, that the relation of defendant to the parties and the transaction was that of surety of W. alone, and she had the right to require that the value of the property covered by the lien of the mortgage of W. should be exhausted before recourse could be had to her mortgage, and the satisfaction of the mortgage of the principal debtor operated as a discharge pro tanto of that of the surety.
    2. Held, further, that the relation of co-sureties did not subsist between W. and defendant, and the liability of each to the plaintiff was therefore not equal.
    3. Everly v. Rice, 8 Harris 297, followed.

      October 30th 1876..
    Before Agnew, 0. J., Siiarswood, Mercur, Gordon, Paxson and Woodward, JJ. Williams, J., absent.
    Error to the Court of Common Pleas, No. 1, of Allegheny county : Of October and November Term 1876, No. 233.
    Scire facias upon a mortgage by George Duncan, president of the Farmers’ and Mechanics’ Bank of East Birmingham, in trust for said bank, against Oliveretta Wharton.
    The facts were these :—
    The firm of Wharton Bros. & Co., of which Clifton Wharton and Oliver F. Wharton were the members, wishing to obtain a line of discount with the Farmers’ and Mechanics’ Bank of Birmingham to the amount of $25,000, the said Clifton Wharton on the 31st of August 1870, executed and delivered to the bank his mortgage on his individual real estate, to secure them against all paper they might discount for said firm endorsed by him, not exceeding $25,000. The bank not being satisfied with the security .of this mortgage, Mrs. Oliveretta Wharton, mother of the Wharton brothers, who had no interest in the firm, executed for their accommodation her mortgage to the bank of same date with the other as additional security.
    The mortgages were for equal amounts, $25,000 each. Notes to the amount of $20,000 were discounted by the bank for Wharton Bros. & Co.
    Clifton paid $10,000, lifting that amount of the firm’s paper, and procured a satisfaction of his mortgage. Subsequently the firm failed, and the bank then sought to collect the balance due, to wit, $10,000, from the defendant on her mortgage.
    The plaintiff contended that the defendant and Clifton Wharton executed their respective mortgages as sureties for the same parties and the same debt, and that the release of the mortgage of the latter did not therefore operate as a discharge of the mortgage in suit.
    The defence set up was that the bank, without the knowledge or consent of the defendant, on or about the 23d December 1872, entered satisfaction in full of the mortgage of Clifton Wharton, giving receipt in full for debt and interest, and thereby in law discharged also the mortgage of defendant as being simply collateral to the former. Or if not discharged absolutely in law, yet that the property held by the bank under the Clifton Wharton mortgage was-in fact amply sufficient to discharge the plaintiff’s claim, and that if so, the satisfaction of such mortgage would discharge the other mortgage as being only collateral. Or if otherwise found, then that the satisfaction of the Clifton Wharton mortgage would operate ■ at least as a discharge pro tanto of the Oliveretta Wharton mortgage, comparing the value of the property bound by the former with the debt for which it was held.
    The court, Collier, J., affirmed a point embodying the views embraced in the foregoing contention of the plaintiff, and refused three points containing those of the defence, and instructed the jury to find for the plaintiff for the amount claimed.
    The defendant took this writ, and assigned this action of the court for error.

      Hill Burgwin, for plaintiff in error.
    Clifton Wharton, whose mortgage was satisfied and discharged, was a member of the firm of Wharton Bros., a principal debtor, liable personally for the debt, both as endorsor and co-partner, while plaintiff in error was, to the extent of the property embraced in her mortgage, only a surety. Her mortgage was intended only as additional secui’ity, that of Clifton Wharton being considered by the bank not sufficient. The receipt by the bank, by which the Clifton Wharton mortgage was satisfied, was under seal and a receipt in full for the mortgage debt, principal and interest. Under the most common principles of the law governing the relations of principal and surety, such discharge of the principal operated as a discharge of the surety : Schock v. Miller, 10 Barr 401; Pitman on Surety 187-191. But if the surety-mortgage was not discharged absolutely, there can be no question that it was at least discharged juro tanto.

      T. M. Marshall and Miller McBride, for defendant in error.—
    The satisfaction of the mortgage of Clifton Wharton by the bank did not operate in law as a satisfaction of the mortgage of the co-surety: Ex parte Gifford, 6 Vesey 805; Mortland v. Himes, 8 Barr 265 ; Schock v. Miller, supra. Equality of burden is the general rule between sureties to the same bond : Story’s Eq. Juris., § 497. The discharge did not extend to the whole debt where the means of payment was only of part: Everly v. Rice, 8 Harris 298; Neff’s Appeal, 9 W. & S. 36 ; Holt v. Bodey, 6 Harris 207; Cathcart’s Appeal, 1 Id. 420; Schock v. Miller, 10 Barr 401.
   Mr. Justice Woodward

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

On the 31st of August 1870, an agreement was made by the Farmers’ and Mechanics’ Bank of Birmingham, to discount notes to the amount of $25,000 for the firm of Wharton, Brothers & Co., of which Clifton Wharton and Oliver F. Wharton were the members. To secure these notes, Clifton Wharton executed to the plaintiff below as trustee of the bank a mortgage of his individual real estate. The security of this mortgage not being regarded as adequate, Mrs. Oliveretta Wharton, the defendant below, rvas induced to execute a mortgage of her real estate in order to provide further protection to the bank. The condition of each mortgage was to secure the payment of the notes that should be discounted for the firm to an amount not exceeding $25,000. On the 23d of December 1872, notes amounting to $20,000 were held by the bank, and on that day, on the payment of $10,000 by Clifton Wharton, the mortgage executed by him was satisfied. This suit was brought on Mrs. Wharton’s mortgage, and a verdict was directed by the court below in favor of the plaintiff, for the amount of the residue of the notes unpaid.

In this somewhat exceptional state of facts, the rule for the adjustment of the rights of the parties is to be deduced by analogy from principles which the authorities have established. Precise precedents can scarcely perhaps be looked for. While Clifton Wharton’s mortgage was a collateral security for the principal debt, the fact is not to be lost sight of that the principal obligations of the debts secured, consisted of notes of the firm of which he was a member, and of these notes he was the endorser. The relation which the defendant held to the parties and the transaction, was that of surety alone. In dealing with Clifton Wharton, it was the duty of the plaintiff to keep these facts in view. He knew the defendant’s position and her rights as well as Clifton Wharton’s duties and obligations. The defendant had the right to require the fund which the principal debtor had pledged to be exhausted before any liability on her part should accrue. And there is nothing in the record to show that the fund was exhausted by the payment of the $10,000, which the plaintiff received from Clifton Wharton on the 23d of December 1872. If the mortgage which was then satisfied had represented the original indebtedness, the defendant as a surety would have been discharged. The principles which discharge a surety where time has been given to the original debtor, apply with equal if not greater force, to a case where the creditor, without the consent of the surety, releases the principal by accepting a composition in discharge of his debt: Ex parte Wilson, 11 Ves. 410. It is unnecessary to encumber this opinion by a reference in detail to authorities on this general subject. The English cases are collected in Pitman on Principal and Surety, pp. 187-191. The state of the law here has been adequately illustrated by Judge Rogers in Schock v. Miller, 10 Barr 401, and by Judge Lowrie in Holt v. Bodey, 6 Harris 207. The satisfaction of Clifton Wharton’s mortgage left $10,000 of the original debt unpaid, and the rights of the defendant must be tried therefore by some different rule.

The ground was taken on the argument, that the relation of co-sureties subsisted between Clifton Wharton and the defendant; that the liability of each to the plaintiff was equal; and that, one-half of the indebtedness having been paid by Clifton Wharton, the other half may be collected by a pursuit of the defendant’s mortgage. If in truth the execution of the two collateral mortgages created the simple relation of co-sureties between the mortgagors, the conclusions of the counsel would be safely founded. As the discharge of the surety has not the effect of a discharge of the principal, so neither will the discharge of one co-surety have the effect of discharging another. A creditor may release, or compound with, or give time to one co-surety without prejudicing his right to proceed against the others; but he cannot recover from the other co-sureties more than the proportion they would have paid, supposing the co-surety released had contributed his share: Ex parte Gifford, 6 Vesey 805; Schock v. Miller, supra. But on what principle can it be said that Clifton Wharton and the defendant were co-sureties merely ? The question would seem capable of settling itself by subjecting it to an obvious and simple test. Can it be doubted that if the whole amount due the Farmers’ and Mechanics’ Bank had been collected by the plaintiff by proceedings on the defendant’s mortgage, that she, the firm of Wharton, Brothers & Co. being insolvent, would be entitled to contribution out of the estate bound by the mortgage of Clifton Wharton ? And can it be pretended, if his estate had provided for the whole indebtedness, that he could set up the fact that his mortgage was collateral, as a ground for establishing the relation of a co-surety with the defendant, and recover contribution from her ? It was his debt which both mortgages were given to secure, and it was his duty to shield the defendant from liability by providing the means of payment.

The extent of the defendant’s legal obligation to the plaintiff was indicated by the statement by a witness at the trial of the purpose for which her mortgage was really executed. Mr. Ammon said that the mortgages “were taken to secure the notes. We didn’t think that Clifton Wharton was sufficient.” It was the manifest understanding of the parties that the defendant, by her mortgage, undertook to make good any deficiencies in the securities held by the bank for the money lent to the firm of Wharton, Brothers & Co. And this precise measure of duty results by legal implication from the circumstances of the transaction. If property belonging to a principal, and property belonging to a surety, respectively, have been deposited with a creditor as a security for his debt, the surety, it would seem, may in equity (upon submitting to pay to the creditor what shall justly be found due to him upon taking the accounts between him and the principal), insist upon the property of the principal being first applied in satisfaction of the creditor’s debt: Aguilar v. Aguilar, 5 Maddock’s Rep. 414. When a creditor has in his hands the means of paying his debt, and he does not use them but gives them up, the surety is discharged so far as the security surrendered would have reached to pay: Everly v. Rice, 8 Harris 297. In that case Miller N. Everly owed John P. Rice $1000, for which he gave his bond and a mortgage on property in New Jersey. To secure this Everly’s mother gave her bond to Rice. At the sale of the New Jersey property, Mrs. Everly was willing to bid $1250 for it, but Rice procured it to be sold for $150. In a suit on the bond given by Mrs. Everly, defence was taken on the ground that Rice by his conduct had prevented her from bidding-the property up to its value, and designedly caused it to be sold to 'another person at a much less price. “If this was true,” it was said by Chief Justice Black in entering the judgment of this court, “ Mrs. Everly was injured to the extent of the difference between the value of the property and the price it sold for. * * * A surety may be subrogated to the rights of the creditor in all the securities, he has against the principal. Mrs. Everly could demand to be so subrogated, or else to have the mortgaged premises sold for the best price, and the proceeds applied to the payment of the debt in her relief.” A recognition and application of the principles thus settled define the rights and obligations of this defendant. She was entitled to have the value of the property covered by the lien of Clifton Wharton’s mortgage applied in relief of her liability, in payment of the notes of Wharton, Brothers & Co., held by the Farmers’ and Mechanics’ Bank. The jury should have been instructed to ascertain the value of that property on the 23d of December 1872, when $10,000 were paid by Clifton Wharton; to deduct the excess of the valuation over the $10,000 thus paid from the $10,000 claimed in this suit on the defendant’s mortgage; and to render a verdict in favor of the plaintiff for the balance remaining due after the application of that excess.

Judgment reversed, and venire facias de novo awarded.

Sharswood, J., dissented.


text:
    Bloomer’s Appeal.
    1. 0. died leaving three children, Caroline, Cornelia and Charles. By his will ho devised all his estate to Caroline, and imposed no conditions upon her to make any provision whatever for the other children. Caroline, however, voluntarily divided the estate, conveying one-third to her brother Charles absolutely, and declaring a trust for anotherthird in favor of her sister Cornelia and children. The undivided half of several tracts of land was embraced in this gift to Cornelia, over which Caroline reserved personal control. Cornelia accepted the trust, but subsequently a difficulty arising with her sister she filed a bill in equity asking that Caroline be dismissed from the trust: (1) because she was living without the jurisdiction of the court; (2) unfitness to manage the trust by reason of her sox, lack of judgment and fickle temper; (3) vindictive feelings towards complainant: Held, that the Common Pleas, under the Act of the 14th of June 1836, had the power to remove, and properly did remove, the trustee, when she, at the time, resided without the jurisdiction of the court whore the trust estate was situate, and there was nothing to show a definite purpose on her part to return.
    2. Held further, that so far as the property contained in the gift to Cornelia had the characteristics of a strict trust, the court could remove the trustee, but as to that portion over which the donor retained personal control the court was powerless to interfere.
    3. Held further, that the facts of this case did not show any ground for apprehension as to the safety of the trust fund, nor such harshness and vindietiveness on the part of the trustee towards her sister as would justify her removal from the trust.

      4. The court below directed the costs to be paid by the trustee: Held, that they should have been paid out of the trust estate.
    November 6th 1876.
    Before Agnew, 0. J., Sharswood, Mercur, Gordon, Paxson and Woodward, JJ. Williams, J., absent.
    Appeal from the decree of the Court of Common Pleas, No. 1, of Allegheny county: Of October and November Term 1876, No. 198. In Equity.
    This appeal was by Caroline Bloomer from the decree of the court, removing her from the management of a trust, declared, by herself in favor of Cornelia E. Sproul and her children.
    The material facts were these :—
    James S. Craft, of Pittsburgh, died on the 18th of November 1870, leaving a will, wherein he gave all of his estate, consisting mainly of lands, and valued at about $600,000, to his daughter, Mrs. Caroline Bloomer. Three children survived the testator, viz., Mrs. Caroline Bloomer, a widow, Mrs. Cornelia E. Sproul, wife of Isaac G. Sproul, and Charles C. Craft.
    The will of the testator, dated September 28th 1869, contained but a single clause, in these words:—
    “ I hereby devise and bequeath to Caroline Bloomer, my beloved daughter, all my estate, real and personal, and constitute her my sole executrix of said will, with power to sell and convey any of my real estate, and to fulfil all covenants I have made respecting said real estate, and make titles thereto according to my said covenants.”
    Mrs. Bloomer assumed the duties of executrix under tMs will, and in the fall of 1871 she voluntarily resolved to make an equal division of her deceased father’s estate between her brother, sister and herself, and in pursuance of this resolution conveyed to her brother Charles 200 acres of land valued at $200,000, and on the 18th of September 1871 executed the following deed of trust in favor of Mrs. Sproul and her children, for another portion of the estate:—
    “Whereas, my father, James S. Craft, Esq., deceased, died seised of certain property, real and personal; and by his last will and testament made me the sole devisee thereof; and whereas, it was understood between my father and myself, that I should hold certain property in trust for my sister, Cornelia E. Sproul, and her children, now' born and that may hereafter be born. In consideration of the wishes of my father, and the natural love and affection for my sister Cornelia, and the sum of one dollar: Now, know that I, Caroline Bloomer, do hereby acknowledge, testify and declare, that I stand seised of certain property, real and personal, hereinafter described ; being a part of the estate and property devised to me as aforesaid, viz.: All that certain house and lot of ground, No. 52 Eerry street, Pittsburgh, Pa., being the same purchased by James S. Craft from John Cameron and'wife, by deed dated March 31st 1870,” &c.
    (Here follows a description of the character and title of various properties and securities.)
    “ Upon the following trusts, I hold the said lands and personal property herein described for the use of the said Cornelia R. Sproul, during her natural life; I, as her trustee, to recover and receive all the rents, issues and profits of said lands and other property; and, after the payment of taxes, and all expenses of every kind or nature whatsoever, to pay over the residue of the fund yearly to said Cornelia R. Sproul, for her own separate use and benefit. At the death of said Cornelia R. Sproul, I bind myself or my successor hereinafter provided for, to execute deeds of conveyance to her said children, as they arrive at the age of twenty-one, conveying to them in fee simple, and in equal portions, the property as aforesaid; and also to transfer to them in the same manner, the personal property aforesaid; and in case of the death of said children or any one of them, the issue of such deceased child or children shall receive the portion the parent would have received if living. But if the said Cornelia R. Sproul should make a will, then the property aforesaid shall be conveyed to her children or their issue, in such proportions and in such a manner as she shall indicate and provide for in any writing in the nature of a last will and testament; with the proviso, however, that I may at any time, at my own absolute discretion, sell and convey the lands and property hereinbefore mentioned, or any part thereof, and make deeds for the same whenever it may to me seem desirable (this power to be personal to myself, and not to be exercised by any other trustee under this declaration); and I hereby bind myself to invest the money arising from any such sale, and to hold it subject to the purposes of this trust, just as the land was held. And it is part of the consideration of this declaration that I am not to be liable or responsible for any losses that may arise from the management of this trust property while I remain trustee. The personal- property hereinbefore described is subject to the payment of one-third part of any claim or claims that may be recovered against me, as the executrix of the estate of James S. Craft, deceased, after the execution of this declaration of trust. In case of my death or resignation, the Orphans’ Court of Allegheny county, state of Pennsylvania, may appoint a trustee to carry out the provisions of this trust.”
    Mrs. Bloomer was the favorite child of the testator, and he had great confidence in her discretion and business capacity. No promise Avas exacted from her by the testator, that she Avould make any disposition of his property such as she did make or any other. It appeared Mrs. Bloomer knew Avhat the Avishes of her father were, but he never made them knoAvn to other parties. From conversations the testator had Avith Mrs. Bloomer and third parties, it was to be inferred, that after his death there should be a division of his estate, but what should be the nature and value of the shares of the several children was left to Mrs. Bloomer alone to determine.
    •Mrs. Sproul frequently expressed her gratitude for and entire satisfaction with the declaration of trust from the time of its execution up to within a short time before this controversy began. She accepted and acted under a power of attorney from Mrs. Bloomer as trustee, and received and used the income of the trust estate for a period of about two years. The relations between the trustee and the cestui que trust and her husband were very friendly. Even up to December 29th 1873, she spoke of Mrs. Sproul as her “ dear sister,” and of Mr. Sproul as a “ dear kind brother.”
    In December 1873, the first sign of dissatisfaction appeared, and that related to the management.of the trust funds. Mrs. Bloomer claimed the absolute control of the corpus of the trust estate, and the right to invest wherever she pleased. She proposed to buy mortgages in Washington city, which she said would pay a higher per centage, and be under her own eye. To this course Mr. Sproul objected. He denied the alleged right to remove any part of the trust funds out of the jurisdiction of the court. Mrs. Bloomer appears to have taken this in good part, but Mrs. Sproul became alarmed and consulted counsel with reference to the matter. The opinion given was enclosed by Mrs. Sproul in a letter to Mrs. Bloomer, in which she alluded to the enclosure, and indicated her intention to follow the advice' therein contained, to have a resident trustee appointed.
    With this letter there commenced an angry and bitter correspondence between the sisters, wherein many harsh and intemperate charges were mutually made, and finally, on the 3d of January 1874, a bill in equity was filed by Isaac G-. Sproul and his -wife, in the right of the wife, which complained, in brief, that the devise of Mr. Craft to Mrs. Bloomer was upon the understanding and promise that the latter would divide his estate equally between the children; that the part of Mrs. Sproul embraced in the deed of trust made by Mrs. Bloomer was not the just portion of Mrs. Sproul in said estate, and was a contrivance of Mrs. Bloomer to retain dominion over said portion ; that Mrs. Sproul accepted said declaration of trust in ignorance of the true value of her deceased father’s estate, and in the fear that her refusal would impose harder conditions upon her; that Mrs. Bloomer had removed from the state and was no longer a resident thereof; that complainant had asked Mrs. Bloomer to relinquish said trust, and consent to the substitution of a new trustee or the appointment of some one, a resident qf the state, to act in conjunction with her, which had been refused in a harsh and insulting manner ; that Mrs. Bloomer, by reason of her sex, lack of prudence and judgment, 'and her fickle temper, was unfitted for the management of said trust, and consequently said trust estate was in peril of waste; that the bulk of said estate was in Allegheny county ; that $100,000 of said estate consisted of personalty yielding income, and a large portion of the real estate yielded income, and that Mrs. Bloomer claimed the right to invest the same where and in what manner she thought proper, and intended to remove said fund beyond the jurisdiction of the courts of Allegheny county.
    The prayer was,
    That an account be taken, and that Mrs. Bloomer be decreed to pay to said Cornelia her just proportion of said estate according to the true intent of the trust arrangement with the testator; that the declaration of trust be annulled, the trustee dismissed, and a new trustee appointed or one to act with her, or that she be required to give security for her fidelity, and that meantime a receiver be appointed, and said trustee be enjoined from interfering with said trust.
    A receiver was appointed and the injunction issued, and Mrs. Bloomer filed an answer, wherein she, in effect, denied that said estate was devised to her under any promise that she would divide the same between the children; that the conveyance to Charles and the declaration of trust were in pursuance of any such understanding with her deceased father; that her sister was in ignorance of the true value of the estate, or was constrained to accept .the declaration of trust; admitted that she had purchased and occupied a house in Washington, D. C., and intended to remain in that city until her son was educated, but denied that she had any intention to change her residence; averred that her sister had written her a letter charging respondent with falsehood, and she was thereby provoked into using the language she had towards her ; admitted that the greater part of the estate was in Allegheny county, and that there was a large income from the estate, but averred that every dollar had been accounted for, and further, that all the trust fund that ever was in Allegheny county was still there, and the respondent did not contemplate changing the investments therefrom ; and further, that there could be no question of respondent’s solvency.
    The bill and answer were referred to a master to take testimony and report.
    Before the master there was evidence to rebut the averment that the trustee was incompetent. The attorney for the trust estate testified that he considered the capacity of the trustee to do business wonderful, and that as far as he could see she had managed the trust property with great care and conscientiousness.
    It was also shown that the appellant was worth from three to four hundred thousand dollars, and that she had increased her own estate about sixty thousand dollars since it came into her hands.

      It was also claimed that the removal of the estate from her hands would be a serious loss to her; that she held in common with the trust estate, a large amount of real estate, about seventy thousand dollars worth of coal on the Monongahela river,, near Pittsburgh, and that there was but one entrance to this coal from the river. Real estate brokers were called, who testified that this coal could only be sold together, that the appellant could not sell her individual interest for one half its value.
    The record showed that a great part of the costs in this suit arose from the efforts of the appellee to destroy the trust instrument.
    No fraud or breach of trust was averred in the bill, and no evidence was offered to show that the appellant had not accounted for every dollar contained in the declaration of trust, and the income therefrom.
    It was contended by the appellant before the master that this trust instrument was a voluntary executory contract, to pay the appellee the proceeds of certain property; that under its general and specific stipulations, the donor or settlor was to retain possession of the property named until she died or resigned. That the donee took the income only upon the express condition that the donor was to hold and manage the property during her life or until she resigned ; that the right of possession has never passed from her, that she did not hold this right in trust for any one, that it was a part of her dominion reserved to herself and a court of equity would violate her rights by taking it from her.
    Five issues were raised by the bill and answer, which are herewith given, together with the findings' of the master thereon, after a review of the testimony.
    1. Whether James S. Craft devised his estate to Mrs. Caroline Bloomer on the “ distinct understanding or promise” that she would divide and distribute said estate justly and equally between herself, her brother Charles, and her sister Cornelia, the plaintiff.
    2. Whether the declaration of trust executed by Mrs. Bloomer in favor of Mrs. Sproul and her children was in pursuance of such understanding or promise and was voluntarily accepted by Mrs. Sproul.
    Upon these two issues the master found in favor of the validity of the trust declared by Mrs. Bloomer for the benefit of Mrs. Sproul and her children, and that they were bound thereby.
    8. Whether Mrs. Bloomer has removed her residence out of the state of Pennsylvania.
    Upon this the finding was:—
    “ The master is of opinion and finds that Mrs. Bloomer has so moved her residence. She purchased, furnished and made extensive improvements in and about a house in Washington city, and has occupied it for nearly three years. This is not consistent with the idea of a mere temporary residence, and especially so when taken in connection with the fact that we hear nothing of an intention to return to Pittsburgh, until this litigation began.”
    4. Whether the conduct of Mrs. Bloomer raises just apprehensions as to the safety of the trust funds.
    Upon this the finding Ayas:—
    “ In view of the character of her testimony, of the spoliation of the books relating to the trust estate in anticipation or during the pendency of litigation, with an evident design to conserve her own and prejudice Mrs. Sproul’s interests, and of her open defiance to the order of this court, the master is of the opinion that there is just ground for apprehension as to the safety of said funds.”
    5. Whether Mrs. Bloomer has skoAvn such harshness and vindictiveness towards Mrs. Sproul as to disqualify her from acting as trustee.
    The finding was, in substance: “Without provocation Mrs. Bloomer charged Mrs. Sproul Avith impertinence and falsehood and made other grave charges against her character. She declared that she would hold on to the trust until she had shoAyn Mr. and Mrs. Sproul that they were poAverless to interfere with her; that Mrs. Sproul could never have a place in her heart again nor would she again address her as sister; that she would follow her to the end if it took all of Mrs. Sproul’s income to do so; she eAren endeavored to prevent the receiver from paying Mrs. Sproul any part of the income to which she Avas entitled. Here,” continued the master, “ is the very essence of harshness and vindictiveness, affecting not only the intercourse between the trustee and cestui que trust, but endangering the trust itself by prolonging litigation.”
    The master further found that Mrs. Bloomer had precipitated these proceedings by her harshness and vindictiveness, and was therefore in fault and should pay the costs.
    To the third, fourth and fifth findings of the master Mrs. Bloomer excepted, but subsequently the court overruled the exceptions, confirmed the report and made a decree discharging Mrs. Bloomer from the duties of the trust, and appointing a trustee in her stead, and directing her to pay the costs of this suit.
    From this decree this appeal was taken.

      George Shiras, Jr., and A. S. Fuller, for appellant.
    The appellant clearly intended in this trust instrument to reserve to herself the right to hold and manage the property donated, during her life or until she voluntarily relinquished her poAver over it; and the intent is the only guide for its construction: Brailsford v. Heyward, 2 Dessaussure 292 ; 1 Fonblanque’s Equity 339, n. In all grants and covenants to stand seised, nothing passes from the grantor by implication. In this instance there is a specific reservation of the right to hold and manage the property. This portion of the donor’s title has never passed from her.

      “ There is a difference between a power reserved to a stranger and to the owner himself. A power over a man’s own estate is a parcel of the dominion reserved to himself, and voluntary, and therefore shall be expounded favorably 2 Fonblanque’s Equity 162. The power in this instance is made an express condition in the contract. It is precedent, for the donee must accept this condition before she can take anything under the agreement.
    The Acts of Assembly authorizing the removal of trustees for non-residence, do not apply to a case of this kind. The trusts contemplated by them are those technical trusts where property is conveyed to one for the use of another, but a trust under an agreement by one to hold for another until a certain time is not such a trust.
    The question of residence is a question of intention. “ Residence is presumed to continue where it has been until a change is affirmatively shown, or at least until there is satisfactory evidence of abandonment Matter of Nichols, 54 N. Y. 62, and cases cited in Fry’s Election Case, 21 P. F. Smith 302.
    The reserved power of sale here cannot be taken from the settlor because it is coupled with an interest, a large portion of the real estate being held in common by the settlor and the trust estate.
    The larger portion of the costs were incurred from the effort of the appellee to destroy the trust instrument, and should not be imposed upon appellant.

      Greorge P. Hamilton, for appellee.
    By Act of 16th June 1836, sect. 1, Purd. Dig. 589, courts of equity in this state have the power of “ control, removal and discharge of trustees.” The power is general and may be exercised' whensoever the welfare of the trust estate would seem to require it.
    It is exercised on the broad principle that in legal contemplation trusts are created for the benefit of the beneficiary, and not for the trustee, and that courts of equity will not permit trusts to fail in whole or in part by the conduct of the trustee.
    The security of the trust estate, and the due execution of the trust, depend largely on the jurisdiction of the court where the trust is created, or where the body of the estate is, over the person of the trustee. Hence, in England and in this country, where the trustee removes beyond the jurisdiction, it is considered a good ground of removal, and the appointment of a new trustee, without regard to whether the trustee is self-constituted or appointed by another, or how the trust has been created.
    Where one of several trustees is out of the jurisdiction, the court will appoint a new trustee in his place, “ although he has a direct beneficial interest in the subject of the trust:” Hill on Trustees (side page) 206.
    The power of alienation reserved to appellant personally, like all other powers in a trust deed which are not coupled with a beneficial interest in the subject of the trust, are presumed tobe for the benefit of the beneficiary, and cannot be used to her prejudice.
    Moreover, the power in question is not of the essence of the trust, but relates solely to the mode of exercising it, and it is a rudimental rule in all such cases, that the trust shall control the power, and not the power the trust. Courts will not allow trusts to fail for want of a trustee, or to be perverted, impaired or destroyed by the agency of the trustee.
    The Act of 14th June 1836, sect. 16, Purd. Dig. 1417, provides for the case where a trustee is “ about to remove out of the Commonwealth.” Sect. 20, Id., provides for the case where a trustee or assignee “ shall have removed from the state, or ceased to have a known place of residence therein for a year or more.”
    In both contingencies the act declares that it shall be lawful for the court to dismiss such assignee or trustee.
    The Act 1st May .1861, sect. 59, Purd. Dig. 1424, authorizes the court to dismiss a trustee where the interests of the estate or property under his charge are likely to be jeopardized, for any reasons by the continuance of such trustee.
   Mr. Justice Woodward

delivered the opinion of the court, January 15th 1877.

In passing on the questions in issue here, it has been felt to be the duty of this court to make every intendment the record would permit in favor of the appellant. By her father’s will, the whole of his estate was vested in her, and she was clothed with unlimited discretion in settling the fortunes of his' other children. The exercise by her of this discretion in the provision made for her brother and sister, was disinterested and generous as well as just. Until the unhappy breach in her relations with Mrs. Sproul occurred, the trust appears to have been faithfully administered, and the rights of the eestwis que trust are amply secured by the private estate of which the appellant is possessed.

Governed by this general view, it was believed throughout the argument and in the subsequent consideration of the cause, that the final decision of the master was erroneously based on the facts he found to be established by the evidence. The character of the defendant’s testimony, what was termed “ the spoliation of 'the books of the trust estate,” and her alleged open defiance of the order of the court, were held sufficient to warrant apprehension of danger to the interests in her hands. It would be a very hard rule that would require the character of a party to an angry legal contest to be tried by the results of a long and close examination respecting large and diversified property interests in which intricate details had been involved. The “spoliation of books” Avas the destruction of accounts and memoranda of Avhich duplicates in the possession or reach of the appellees were in existence. The act put no part of the trust estate at hazard, and can readily be attributed to ignorance and inexperience. In the course taken by her while the litigation was pending, it is to be assumed that the appellant acted under the advice of counsel. Nor was what the master regarded as the harshness and vindictiveness of the appellant towards Mrs. Sproul believed to be a justification of the final decision. The facts disclosed in this connection grew out of the suit while it was in prospect and in progress. The state of feeling shown by the testimony to have existed between these parties is greatly to be deplored. The existence of evil temper that exhibits itself in evil deeds or explodes in evil speech, is always deplorable. But the bitterness of family feuds is proverbial. Metí and women suffer themselves to speak to or of relatives from whom they differ — especially near relatives — in a manner they never adopt in speaking to or of strangers. And the master made too much account of perhaps natural demonstrations of a temper subjected by the exigencies and incidents of this suit to unwonted strain.

It was thought also the evidence did not warrant the finding that the appellant had removed from Pennsylvania. And it is still believed that the purchase and occupation of a house in the city of Washington, without more, would not, even where a man might be the head of a family, be enough to imply the intention of a change of domicile. Multitudes of families not even indirectly connected with the business of the national government, live there for years, and if a profession is not pursued nor a business undertaken, the presumption to be rebutted is that the residence is temporary, and not that it is permanent. Looking into the evidence, however, it is found that there is nothing to show a definite purpose on the part of the defendant to return to Pennsylvania. In her answer she denied that she intended to acquire a new residence, but she stated that she had purchased a farm in West Virginia at the request of her son, to whom she designed to convey it at his majority. She added that she would probably remain in Washington until her son should finish his education. This indicated at least a protracted absence and an indefinite return. The 20th section of the Act of the 14th of June 1836, makes it lawful for the court having jurisdiction to remove a trustee who shall have removed from the state or ceased to have a known residence therein for the period of a year or more.” Upon the facts disclosed in the evidence, it cannot be said that there was error to warrant a reversal on this ground in the decision of the master and the decree of the Common Pleas.

It remains to inquire to what extent the decree ought to be carried out. So far as the property dedicated by the appellant to the use and benefit of Mrs. Sproul and her children was subjected to the characteristics of a strict trust, it was within the jurisdiction of the court below, and their action will have to be left undisturbed. But there were portions of the estate in which the appellant expressly retained contract rights, and over which she reserved exclusive personal dominion. The undivided half of several tracts of land was embraced in the gift to Mrs. Sproul. After defining the trusts on which the property should be held, the deed proceeded in these words : “ With the proviso, however, that I may at any time, at my own absolute discretion, sell and convey the lands and property hereinbefore mentioned, or any part thereof, and make deeds for the same whenever it may to me seem desirable (this power to be personal to myself, and not to be exercised by any other trustee under this declaration); and I hereby bind myself to invest the money arising from any such sale, and to hold it subject to the purposes of this trust, just as the land was held.” It is manifest from the language of this proviso that the reservation of control over property by the appellant was intended to be confined to land. That it was intended also to be confined to the land of which she was a tenant in common, was shown by her statement in the answer to the bill. “I reserved powers to myself,” she declared, “ because they are necessary to the full enjoyment of my own property. Under said declaration of trust, my sister and myself are tenants in common of about $100,000 worth of real estate. I reserve the absolute power to sell at my discretion her share of this property, because much of it is coal property, and is of a nature that it would only sell to advantage by being sold together. There are several pieces of property out of the state of Pennsylvania in the same position, and I was not willing to part with this power or divide it with others.” When the trust was declared, the master has found that the appellant held the absolute title to the whole of' her father’s estate. In divesting herself of any part of that title, it was competent for her to impose any conditions she might deem expedient upon the property transferred. In effect, the deed made her the trustee of any moneys she should receive from the real estate held in common after it should be sold. All she bound herself to do respecting that property was to hold the money arising from its sale “subject to the purposes of the trust.” She thus retained a control over and an interest in this part of the property described in the declaration, and with that the court, under the powers conferred on them by the statute, were not authorized to interfere. Under the facts found by the master, this deed is subject to the rules that govern voluntary grants. It is to be construed as to the grantee according to its strict terms, and so as to effectuate the intention of the grantor. While the residue of the estate described in the declaration of trust will have to be transferred to the control of a new trustee under the decree of the court below, the lands held in common must be left in the appellant’s hands until the present situation of the parties and property shall be in some way changed. The right to retain the management of this property, however, is subject to the duty on the part of the appellant to give adequate security for the faithful discharge of the duties which the deed imposed. She is found by the master’s report to be resident out of the state, and the oestuis que trustent have the right to demand protection, not only against ordinary hazards, but against the consequences of absence and neglect.

The imposition of the costs on the appellant, even in view of the equities of the case as they were adjusted by the master and the Common Pleas, was by the application of a rule unduly harsh. There had been no breach of trust, no waste, mismanagement or misappropriation of the trust funds, and no such misconduct as to make the suit necessary to protect the interests of the appellees. The appellant had the right to defend herself against the attempt to oust her from the control of the common property, and under all the circumstances surrounding the parties, the costs should have been directed to be paid out of the trust estate.

And now, to wit, 15th January 1877, it is ordered and adjudged that so much of the decree of the Court of Common Pleas as discharged the defendant, Mrs. Caroline E. Bloomer, from the management and control of the lands described in her declaration of trust in which she owned an undivided interest, and so much thereof as directed the payment of the costs before the master and in the Common Pleas, be reversed; and that the said costs be paid out of the estate belonging to the plaintiffs in the defendant’s hands. And it is further ordered and adjudged that the said defendant, Mrs. Caroline E. Bloomer, give bond in a sum to be fixed and with sureties to be approved by the said Court of Common Pleas, conditioned for the faithful discharge of her duties as trustee of the undivided half of the real estate of which she retains control, and for the faithful payment of the rents, issues, profits and proceeds of sale thereof; and that the record be remitted in order that this proceeding may be had. The residue of the decree of the Common Pleas is affirmed, and it is ordered that the costs of this appeal be paid by the appellees.


author: Mr. Justice Paxson

text:
    Woods versus Peoples’ National Bank of Pittsburgh.
    1. A mortgage given to a National bank to secure a future loan is ultra vires and therefore void.
    2. A mortgage given to a National bank to secure a pre-existing debt is valid.
    3. Where a mortgage was given to a National bank partly to secure certain pre-existing notes, upon which W. was an accommodation endorser, and partly to secure a future loan, Held, that the mortgage was void as to the future loan, and that W. had a right to have the proceeds of a sale of the mortgaged premises under the mortgage applied to the payment of the notes of which he was endorser.
    November 8th 1876.
    Before Agnew, C. J., Sharswood, Mercur, Gordon, Paxson and. Woodward, JJ. Williams, J., absent.
    Error to the Court of Common Pleas, No. 1, of Allegheny county: Of October and November Term 1876, No. 239.
    Assumpsit against Robert Woods as endorser of three promissory-notes.
    In 1869 and 1870 Robert Woods, the defendant below, endorsed three accommodation notes of R. L. McAboy, to the amount of $7000, which notes were discounted by the Peoples’ National Bank of Pittsburgh, the plaintiff below. In March 1870, the bank loaned McAboy $5055 upon his own note unendorsed. On September 1st 1870, the wife of McAboy executed a mortgage to the bank for $20,000 to secure the above note.s and to secure an additional loan to McAboy of $8000, which latter was made to him September 8th 1870, McAboy giving the bank two notes for $4000 each. The notes endorsed by Woods were subsequently renewed. Afterwards, upon default in payment of the various notes, the bank brought suit upon its mortgage and recovered $13,564.82 upon it, and then brought this action against Woods upon the notes endorsed by him. Upon these facts the court below (Stowe, A. J.) instructed the jury to find for the plaintiff, which they did in the sum of $9228.94. After judgment the defendant below took this writ of error, assigning for error the charge of the court and the refusal of evidence of an admission made by the president of the bank tending to show the purpose for which the mortgage in question was given to it.

      Hampton & Dalzell, for the plaintiff in error.
    So far as the mortgage was intended to secure the loan of $8000 it was void : Fowler v. Scully, 22 P. F. Smith 456 ; no part of the proceeds can be applied to that loan, as that would be a fraud upon the National Bank Act and on Woods.

      M. W. Acheson and W. L. Ohalfant, for the defendant in error.
    Even if the mortgage was void that constitutes no defence to Woods. In Fowler v. Scully, the mortgage showed on its face that it was to secure .future advances ; not so here. Therefore, McAboy himself could not have been heard to impeach it.
    Again, McAboy made no defence to the suit on the mortgage, and the judgment therein cannot be impeached collaterally : Verner v. Carson, 16 P. F. Smith 440.
    The mortgage Avas not given for Woods’s benefit, but to secure the bank and primarily the $8000. IIoav can Woods be allowed to deprive the bank of its security and defeat the intentions of the party to the mortgage ? Resides., Woods has no equity of subrogation till the bank is paid: Brough’s Estate, 21 P. F. Smith 460; Kyner v. Kyner, 6 Watts 221; Bank v. Potius, 10 Id. 148.
    The bank could not refuse to appropriate the proceeds of the mortgage to the $8000 loan on the ground that the mortgage pro tanto exceeded the corporate poAvers : Parish v. Wheeler, 22 N. Y. 494.
    The declaration of the president was not part of the res gestee, and besides was made íavo years after the transaction ; it was inadmissible: Pennsylvania Railroad Co. v. P. & R. Railroad Co., 21 P. F. Smith 350.
   Mr. Justice Paxson

delivered the opinion of the court, November 20th 1876.

It Avas held in Fowler v. Scully, 22 P. F. Smith 456, that the loaning of money by a national bank upon mortgage or other real estate security is ultra vires, and forbidden by the Act of Congress. This of course does not apply to the case where a bank has in good fiiith taken a mortgage by way of security for a previously existing debt. Such case comes Avithin one of the express exceptions of the Act of Congress. It follows, therefore, that in so far as the mortgage of Mrs. McAboy to the Peoples’ National Bank of Pittsburgh was given to secure money thereafter to be loaned to her husband, it Avas ultra vires. It is manifest from the evidence that the loan of $8000 to Mr. McAboy on or about the 8th of September 1870, was upon the faith of the mortgage. As to this loan the mortgage was not a valid security. But it Avas good as to the indebtedness of Mr. McAboy to the bank existing prior to its execution, amounting to about $12,055. Eor $7000 of this sum the bank held the endorsements of the plaintiff in error. His contention is that the bank was bound to apply the money received from a sheriff’s sale of the mortgaged premises to the notes held by it at the time the mortgage was given. In this Ave think he is right. As the endorser of Mr. McAboy’s notes, held by the bank, he had a right to call upon the latter to apply the money to the payment of the notes for which alone the mortgage was legally held as security. The mortgage was as much for his benefit as for the bank. The latter ha no right to apply the proceeds thereof to the two unsecured notes of $4000 each. Under the authority of Fowler v. Scully, supra, Mr. McAboy could have objected to such appropriation. Whatever he might have done in this respect, the plaintiff in error as his endorser may do also.

From what has been said it will be seen that both the assignments of error are sustained. The judgment is reversed, and a venire facias de novo awarded.