author: Mr. Justice Elkin,

text:
    Moore’s Estate
    (No. 1).

      Orphans’ court—Jurisdiction—Question of title.

    No one can claim in the distribution of an estate in the orphans’ court except as creditor, legatee or next of kin, but where it is shown that funds have been wrongfully included in the acoount as trust funds, or where title or ownership is in another person, to avoid circuity of action jurisdiction may be assumed.
    Where a certificate of stock in the name of a son of the decedent is found among the decedent’s effects, and the executors claim it as a part of the estate, and the son executes a transfer of it with knowledge that the executors intend to sell it, and the executors do sell it and hold the proceeds as part of the estate, and the son makes no claim on account of it until the audit of the executors’ account two years thereafter, the presumption of the son’s ownership of the stock is rebutted, and his claim to the proceeds of the stock is properly disallowed. In such a case the orphans’ court has jurisdiction to pass upon the claim.

      Orphans’ court—Findings of fact—Review.

    Where the auditing judge in the orphans’ court finds as a fact upon sufficient evidence, that the compensation claimed by executors is just and reasonable, and his findings are confirmed by the court below, the appellate court will not reverse in the absence of manifest error.
    Argued Jan. 11, 1905.
    Appeal, No. 276, Jan. T., 1904, by Fidelity Trust Company et al., executors, from decree of O. C. Phila. Co., July T., 1898, No. 56, dismissing exceptions to adjudication in Estate of Andrew M. Moore, deceased.
    Before Mitchell, C. J., Dean, Fell, Brown, Mestrezat, Potter and Elkin, JJ.
    Reversed in part.
    Exceptions to adjudication.
    The facts appear by the opinion of the Supreme Court.

      Errors assigned were in dismissing exceptions to adjudication.

      S. Gordon Me Gouch, with him 0. Percy Bright and Francis Shunk Brown, for appellant.

      V~. Gilpin Robinson, with him John M. Gardner, for appellee.
    April 10, 1905:
   Opinion by

Mr. Justice Elkin,

Under the first assignment of error it is contended by the appellants that the learned auditing judge and the court below erred in sustaining the claim of Albert H. Moore for the sum of $875, being the proceeds of the sale of ten shares of the capital stock of the Teutonia Fire Insurance Company. From the evidence it appears that among the securities and other papers of Andrew M. Moore, deceased, were found three certificates of stock, issued by said company, in the name of his three sons. One of these certificates for ten shares was in the name of A. H. Moore, the claimant. The other two certificates were in the names of his brothers, George M. Moore and Harry G. Moore. The executors claimed the certificates as part of the estate of the decedent. Each of the two brothers signed the power of attorney on the back of the certificate in his name in order that it might be transferred to the estate. The claimant at first declined to make an assignment of his certificate. The executors desiring to sell this stock, waited upon the attorney for A. H. Moore, stated the facts relating thereto and asked him to get his client to sign the power of attorney so that the stock could be transferred to the estate and be disposed of. This was done in July, 1901. The accountants sold the stock, received the proceeds, and charged themselves with the sum so receiyed in the account filed. The claimant made no demand upon them for this stock or the proceeds of the sale thereof until the time of- the audit in April, 1903, when his attorney presented a claim against the estate for said sum. The auditing judge and the court below concluded to pass upon the merits of the claim. The learned counsel for appellants argue that the orphans’ court did not have jurisdiction to hear and decide the question raised. Corson’s Estate, 137 Pa. 160, has been cited in support of this contention. The facts in that case are entirely different from those in the case at bar. In that case a bill in equity was pending in the common pleas to determine the ownership of the securities at the time the account was filed in the orphans’ court. The claimant having chosen a court of cdmpetent jurisdiction in which to determine his rights, could not be heard in a different tribunal to raise the same question in another form of action. This court said he could not do so. In that case the ruling of the court was clearly right. The general rule is that no one can claim in the distribution of an estate in the orphans’ court except as creditor, legatee or next of kin, but where it is shown that funds have been wrongfully included in the account as trust funds, or where title or ownership is in another person, to avoid circuity of action jurisdiction may be assumed: Marshall v. Hoff, 1 Watts, 440; Miller’s Appeal, 84 Pa. 391; High’s Estate, 136 Pa. 222; Qualter’s Estate, 147 Pa. 124; Crosetti’s Estate, 211 Pa. 490. This case is within the rule just stated, and the court exercised proper jurisdiction.

In passing on this question, the court below said: “ There was found among the papers of the testator a certificate for ten shares of stock in this company in the name of Alfred H. Moore, the claimant. As the stock stood in his name prima facie it was his. There was nothing to rebut this presumption. At any rate it was a question of fact which the auditing judge fully considered and his finding^must stand unless clearly erroneons.” In view of the testimony of Mr. McCouch, the second vice president and secretary of the Fidelity Trust Company, we think there was error in this ruling. If there was no testimony to rebut the presumption of ownership the court below would have been right, but there seems to be sufficient evidence to rebut the presumption and to conclusively show that these ten shares of stock belonged to the estate of the decedent and were so treated by the claimant. The witness, Mr. McCouch, was the only person called to testify by either side aborit the ownership of this stock. His testimony will be found in the Appendix from page 98 to 105. The following are excerpts from his testimony, being answers to questions asked by counsel: “ A. The facts are as follows: At the time the executors took over the assets of the estate they found certificates for a certain number of shares of the Teutonia Fire Insurance Company made out in the name of the decedent. They also found certain certificates made out in the name of, his sons. My recollection is that there were three of them ; one in the name of each of the sons. The certificates all came into the custody of the executors as part of Mr. Moore’s estate. Mr. Robinson: I object to that. The witness: I will omit the last two or three words. They came into the possession of the executors with other assets of the estate.”

“ The net result of our negotiations was that all stockholders who surrendered their certificates, properly indorsed and transferred, received eighty-seven and one half a share. We held the certificate in such a condition that we could not use it. We then, as I have stated, communicated with counsel for Mr. Moore, and, on explaining the facts to him, he procured Mr. Moore’s signature to the assignment of the certificate of stock. That is as far as my recollection goes. We then turned it in with the others arrd got our money. Q. Did he ever claim that the money should be paid to him ? A. He made no claim of that kind, no. On the contrary, it was distinctly recognized by signing that he was making the certificates available to the executors as an asset of the estate.”

“ A. I beg your pardon. It is quite true, as you have stated, that I have no recollection about the. details which you have inquired about, because, in connection with the object I had in view, they were to my mind immaterial; but I have a very distinct recollection about the essential thing that it was necessary for me to do, to wit: to persuade Mr. Moore that that was the property of the estate, and to obtain his signature in order that the estate could collect the eighty-seven and one half a share on it.”

The claimant was entitled to the certificate of stock, if anything. There is no evidence that he ever made any demand for it. It is true he at first refused to sign the power of attorney to transfer, but even at that time he did not assert ownership to the stock. The executors claimed the stock at all times as an asset of the estate. When he signed the power of attorney he must have known under the testimony of Mr. McCouch, that he was putting the stock in shape to be available as an asset of the estate. For almost two years after that time he made no demand either for the stock or the proceeds of the sale. In other words, he treated it as an asset of the estate until his counsel raised the question at the audit. The two brothers, whose certificates stood in their names under similar circumstances, transferred their stock to the estate and made no claim for the same. Under these facts, established by competent testimony, we are of opinion that the presumption of ownership in A. H. Moore is rebutted; that the shares of stock belonged to the estate and the proceeds thereof should be accounted for by the accountants. This assignment is sustained.

The appellants contend under the second and third assignments that the court below erred in fixing the amount of the proceeds of the sale of the Girard House property, on which commissions should be charged, at $700,000. This property was encumbered by a mortgage of $400,000, and a ground rent of $100,000. The court below sustained the finding of the auditing judge in respect to ‘the amount on which the accountants should be allowed a commission. The learned judge who delivered the opinion of the court said: “ The auditing judge refused to allow commissions on the said $400,000 mortgage which was paid off and satisfied by giving the holder thereof trust certificates to that amount secured by the new mortgage under the trust agreement before referred to. There was practically a substitution of a mortgage in one form for one in another. There was no money passed through the hands of the accountants, and therefore no responsibility on that account. There was, of course, some trouble for them in arranging and carrying out the details of this transaction, but as they are allowed commissions on the whole balance of the purchase money, which amounts to a very considerable sum, this ought to be sufficient compensation.” The rulings of the learned judge are predicated on three findings of fact: first, there was practically a substitution of a mortgage in one form for one in another; second, no money passed through the hands of the accountants and therefore there was no responsibility on that account; and third, the commissions allowed to the accountants amounted to a large sum and are sufficient compensation. If the evidence justified the findings of fact there was no error in the conclusions of law.

It may be admitted that under the facts whereb3r the accountants covenanted to sell clear of encumbrances, there is a doubt as to what is the proper construction to be placed upon these agreements so far as they relate to the amount on which commissions should be allowed. Inasmuch, however, as the auditing judge and the court below have found the compensation allowed to be reasonable and sufficient, we think there was no such manifest error as would require this court to reverse either their findings of fact or conclusions of law in this respect. These assignments are overruled.

It is ordered that the record be remitted to the court below in order that the schedule may. be corrected and distribution made in accordance with this opinion, the costs to be paid out of the estate.


source: Caselaw Access Project

author: Mb. Justice Elkin,

license: Public Domain

text:
    Moore’s Estate
    (No. 2).

      Executors and administrators—Trust company—Compensation.

    Where a trust company, which is an executor in an estate, performs certain acts for the estate in pursuance of its ordinary business^ but entirely independent Of'any duty which it is required to perform as executor, it is entitled to compensation for such acts ovér’ and;abbve its commissions as executor.. . . . . ';J . !

      Executors and administrators—Commissions—Ground rent.

    An executor is not entitled to a'commission upon the principal or capitalized amount of a ground rent which is an incumbrance on the property, and which is included in the price of the real estate sold out of which it is payable. In such cases an executor or administrator is only entitled to a commission on the balance of the price remaining after deducting the amount of the incumbrance.
    Where a deed from executors recites a consideration less than that stated in the preceding contract of sale, and it appears that the purchaser retained the difference to pay off a ground rent, the executors are entitled to commissions only on the amount recited in the deed, less incumbrances against the property sold.

      Executors and administrators—Commissions—Real estate—Personal estate.

      . There is no set rule as to percentage allowed to executors and trustees on the sale of real estate. The rule is fair compensation for the amount and character of labor performed and responsibility involved.
    Where the real estate consisted of several properties, including a large hotel, and the proceeds amounted to over $1,000,000, three per cent on amount of proceeds less incumbrances was allowed as a proper compensa^ tión.
    What is a fair and reasonable commission on personal estate depends upon the amount and character of the services performed and responsibility involved.
    Where there is no evidence of any unusual services or trouble in the settlement of the estate, and there is nothing more than ordinary responsibility, although the estate is large in amount, three per cent will be allowed as a proper compensation.
    Argued Jan. 11, 1905.
    Appeal, No. 167, Jan. T., 1904, by Albert H. Moore, from decree of O. C. Phila. Co., July T., 1898, No. 56, dismissing exceptions to adjudication in estate of Andrew M. Moore, deceased.
    Before Mitchell, C. J., Dean, Fell, Brown, Mbstrezat, Potter and Elkin, JJ.
    Reversed in part.
    Exceptions to adjudication.
    The facts appear by the opinion of the Supreme Court.

      Errors assigned were in dismissing exceptions to adjudication.

      V. Gilpin Robinson, with him John M. Gardner, for appellant,
    ’cited on the question of commissions: Wedekind’s Est., 11 Phila. 68 ; Brice’s Appeal, 95 Pa. 145; Wistar’s Estate, 192 Pa. 289; Young’s Estate, 204 Pa. 32; Bosler’s Estate, 161 Pa. 457; Thouron’s Est., 182 Pa. 126; Mintzer’s Est., 18 Phila. 97 ; Butterbaugh’s Appeal, 98 Pa. 351; Spangler’s Estate, 21 Pa. 335 ; Hoxie’s Estate, 14 Pa. C. C. Rep. 633.

      IT. Gordon Me Couch, with him 0. Percy Bright, Ira Jewell Williams and Simpson $ Brown, for appellee,
    cited: Moore’s Estate, 191 Pa. 600 ; Stevenson’s Estate, 4 Whart. 98 ; Donat’s Est., 6 Pa. Dist. Rep. 78; Semple’s Est., 189 Pa. 385 ; Young’s Estate, 204 Pa. 32; Oliver’s Est., 18 Phila. 226 ; Wistar’s Est., 192 Pa. 289.
    April 10, 1905:
   Opinion By

Mb. Justice Elkin,

The appellant contends under the first assignment of error that the accountants should not be allowed a credit of $500 claimed by them in the account filed, being the sum paid to the Fidelity Trust Company for its services in acting as trustee for the trust certificate holders, arranging the machinery of a loan, drawing up the papers, signing the certificates and acting as registrar. The auditing judge took this view and refused to allow credit for this item.. The court in banc reversed the finding of the auditing judge.

All of these acts were performed by the Fidelity Trust Company in pursuance of its ordinary business and were entirely independent of any duty it was required to perform as executor. It was therefore entitled to compensation for these services. We think the amount claimed is reasonable and that credit should be allowed for the same. This assignment is overruled.

The second and third assignments deny the right of the accountants to a commission of three per cent on the sum of $100,000 being the amount retained out of the purchase price by the purchasers with which to extinguish the ground rent on the Girard House property. The auditing judge disallowed this credit. The court below reversed the auditing judge and allowed a credit of $3,000 as a commission on this sum. In this we think the learned court erred. It is settled law that an executor is not entitled to a commission upon the principal or capitalized amount of a ground rent which is an encumbrance on the property, and which is included in the price of the real estate sold out of which it is payable. In such cases an executor or administrator is only entitled to a commission on the balance of the price remaining after deducting the amount of the encumbrance: Brolasky’s Appeal, 3 Penny. 329; 11 Am. & Eng. Ency. of Law (2d. ed.), 1299.

Under this rule of law the only question that can arise here is whether the property was sold subject to the encumbrance of the ground rent. The deed from the executors and trustees to the Gimbels, the purchasers, recited a consideration of $1,100,000. The contract price clear of encumbrances was fixed at $1,200,000, showing that the purchaser retained $100,000 from tire purchase price for the purpose of extinguishing the ground rent. The deed of conveyance from the executors to the purchasers contained the following clause: “ Under and subject nevertheless to the payment of the aforesaid yearly ground rent or the sum of $6,000 when and as the same shall hereafter accrue grow due and become payable.” This deed was dated August 3, 1900, and acknowledged the same day. The deed extinguishing the ground rent executed by John A. Brown et al. to Jacob Gimbel et al. was dated Aug'ust 4, 1900, but was not acknowledged until August 9, 1900, and could not have been delivered until on or after the latter date. These records conclusively show that the deed from the accountants to the purchasers of the property was made subject to the encumbrance of the ground rent. The auditing judge so found. He also found as a fact that the $100,000 necessary to extinguish the ground rent was paid by the purchasers of the property to the vendors of said ground rent, and not by the accountants. Under these facts the accountants are not entitled to a credit of $3,000 as a commission on the amount paid to extinguish the ground rent. These assignments are, therefore, sustained.

In the fifth, eighth and fourteenth assignments the appellant raises the question of the rate of commissions the accountants should receive on the proceeds of the real estate sold and accounted for. The auditing judge reduced the rate of the commissions claimed by the accountants on the proceeds of the sale of the Oxford and Arch street properties, to two and one half per cent. The court below fixed the rate of commissions on all real estate accounted for and on which commissions were allowed, at three per cent. The auditing judge allowed three per cent on the proceeds of the sale of the Girard House property and the evidence does not disclose any sufficient reason why the accountants should not he allowed the same rate on the proceeds arising from the sale of other real estate. We do not agree with the learned court below in saying that there is a minimum rate fixed by rule of law. There is no set rule as to percentage on the estate in such cases. The rule is fair compensation for the amount and character of labor performed and responsibility involved: Wistar’s Estate, 192 Pa. 289; Young’s Appeal, 204 Pa. 32. In this case we think three per cent on the proceeds arising from the sale of all real estate, less encumbrances, is a reasonable compensation for the responsibility, services and trouble of the accountants.

The question of the amount on which commissions should be allowed will be discussed in the appeal at No. 276, January Term, 1904.

Under the sixth and fifteenth assignments it is contended by appellant that the court below erred in increasing the rate of commission on the personal property from three per cent, as fixed by the auditing judge, to three and one half per cent, being the rate claimed by the accountants. What is a fair and reasonable compensation depends upon the amount and character of the services performed and responsibility involved. The auditing judge has found as a fact that there was. no evidence of any unusual services or trouble in the settlement of the estate and that there was nothing more than ordinary responsibility. Keeping tbis in view he fixed the rate of compensation on personal property at three per cent. After careful examination of the evidence we fail to discover that the accountants performed any unusual or extraordinary services. In Young’s Estate, 204 Pa. 32, the commission claimed by the executor was reduced from four and one half per cent to three per cent, and this court affirmed that case. Under the facts of the case at bar we do not feel disposed to disturb the ruling of the auditing judge in. this respect. This assignment is sus-, tained.

The other assignments of error are without merit and are dismissed.

It is ordered that the record be remitted to the court below in order that the schedule may be corrected and distribution made in accordance with this opinion, the costs tp be paid out-of--the estate.


text:
    Moore’s Estate
    (No. 3).

      Executors and administrators—Trust company—Interest on deposits.

    Where three executors, one of whom is a trust company, deposit in the trust company funds of the estate, and the company allows the usual two per cent interest thereon, it cannot be surcharged with interest in excess of that rate on the theory that acting in a fiduciary capacity it was bound to account for all profits made out of the estate.
    Argued Jan. 11, 1905.
    Appeal, No. 229, Jan. T., 1904, by George M. Moore, from decree of O. C. Phila. Co., July T., 1898, No. 56, dismissing exceptions to adjudication in Estate of Andrew M. Moore, deceased.
    Before Mitchell, C. J., Dean, Fell, Brown, Mestrezat, Potter and Elkin, JJ.
    Affirmed.
    Exceptions to adjudication.
    The opinion of the Supreme Court states the case.

      Errors assigned were in dismissing exceptions to adjudication.

      William S. Divine, for appellant.

      H. Gordon Mo Couch and Alex. Simpson, Jr., with them 0. Percy Bright, Ira Jewell Williams and Francis Skunk Brown, for ajipellee.
    April 10, 1905:
   Opinion by

Mr. Justice Elkin,

Most of the assignments of error in this case have been disposed of at No. 167 January Term, 1904. One question, however, has been raised which was not considered in that appeal. It is this: Should the Fidelity Trust Company, one of the accountants, be required to pay the interest earned by it on the several sums of money belonging to the decedent and deposited with said company during the time the estate was being settled ? Under the will of Andrew M. Moore, deceased, three executors were named. One of these executors was the Fidelity Trust Company. As the funds were collected the accountants deposited them with said company. This company in the ordinary and usual way paid the accountants two per cent on daily balances. The appellant, however, contends that the Fidelity Trust Company being one of the executors, and acting in a fiduciary capacity as such, should be required to account for all the interest earned by the company in the use of these funds. In other words, if that company as a bank loaned these funds out at six per cent, as an executor it should be required to account to the estate for interest at that rate. The auditing judge and the court below found against the contention of the appellant here. They were unquestionably right in so doing. The Fidelity Trust Company, it is true, acted in a dual relationship in this matter. It was a bank. It was also an executor, but it was only one of the three executors who settled the estate of the decedent. It acted as an executor under the authority conferred upon it by law, but it also in pursuance of its lawful, regular and ordinary business accepted moneys on deposit and loaned the same for profit. It had a legal right to act in both capacities. The accountants deposited the funds of the estate from time to time with the trust company for convenience and safe keeping. It would have been just the same as if they had taken these funds to any other trust company and deposited them there for the same purpose. It was in evidence that the trust company paid to these accountants the same rate of interest on daily balances paid by it to all other customers. It cannot be required to pay more. The suggestion that this trustee intermingled these trust funds with its own is without merit and does not require serious consideration.

This appeal is dismissed, the costs to be paid by appellant.


author: Mb.. Justice Brown,

text:
    Carr, Appellant, v. Myers.

      Bankruptcy—Insurance—Suit by trustee—Pleadings—Statement.

    ^ilere a woman who is a beneficiary in policies of life insurance on the life of her husband, assigns the policies to her daughters, and thereafter becomes a bankrupt, and the daughters after the death of the husband collect the proceeds, the trustee in bankruptcy of the mother in a suit against the daughters to recover the proceeds, must, in his statement of claim, aver that the bankrupt had a property in the policies “which, prior to the filing of the petition in bankruptcy, she could by any means have transferred, or which might have been levied upon and sold under judicial process against her.” A mere averment that the bankrupt was the beneficiary in the policies is wholly insufficient.
    Argued Jan. 17, 1905.
    Appeal, No. 158, Jan. T., 1904, by plaintiff, from judgment of C. No. 5, Pliila. Co., Sept. T., 1901, No. 3043, for defendant on demurrer to statement in case of George W. Carr, trustee of Mary Myers, in bankruptcy, v. Lillie Myers, Elsie Myers and Bella Myers.
    Before Mitchell C. J., Dean, Fell, Brown, Mestrezat, Potter and Elkin, JJ.
    Affirmed.
    Demurrer to statement.
    The averments of the statement of claim are set forth in the opinion of the Supreme Court.

      Error assigned was in sustaining demurrer to statement.

      Alex. Simpson, Jr., with him, O. Wilfred Qonard and Harry E. Kohn, for appellant.
    The proviso in section 70 of the act inferentially shows that interests in insurance policies are recognized as passing to the trustee in proper cases and the cases in the various bankruptcy courts have frequently been so decided: In re Slingluff, 5 Am. Bank Rep. 76; in re Welling, 7 Am. Bank Rep. 340; 113 Fed. Repr. 189; in Re Holden, 114 Fed. Repr. 650.
    In Pennsylvania it lias been long settled law that the interests of the beneficiary in policies of life insurance is absolutely vested, and, save for the liability to being defeated by a failure to pay the premiums when due, similar to any other chose in action : Degintker’s App., 83 Pa. 337 ; Mutual Aid Society v. Miller, 107 Pa. 162; Anderson’s Est., 85 Pa. 202: Baltz’s Est., 4 W. N. C. 447; Waltz v. Mutual Aid Society, 5 Pa. C. C. Rep. 208.
    The rule above stated is the same throughout the country as is indicated by the following authorities : Central Banks of Washington v. Hume, 128 U. S. 195 (9 Sup. Ct. Repr. 41) ; McCauley’s App., 93 Pa. 102; Wirgman v. Miller, 98 Ky. 620 (33 S. W. Repr. 937); Golden Star Fraternity v. Martin, 59 N. J. Laws 207 (35 Atl. Repr. 908); Locomotive Engineers’ Mutual Life and Accident Ins. Assn. v. Winterstein, 68 N. J. Eq. 189 (44 Atl. Repr. 199).
    The interest of the beneficiary was assignable: Wheeland v. Atwood, 192 Pa. 237; Dusenberry v. Life Ins. Co., 188 Pa. 454 ; Herr v. Reinoehle, 20 Lanc. Law Review, 291; Landrum v. Knowles, 22 N. J. Eq. 594; Hewlett v. Home for Incurables, 24 Alantic Repr. 324.

    Courts of bankruptcy have held policies of insurance to go to the trustee: In re Slingluff, 5 Am. Bankcy. Rep. 76; In re Welling, 113. Fed Reps. 189.
    The trustee took all of the interest which Mary Myers had in the policies at the .date of her adjudication. That is, he took the whole interest: Deginther’s App., 83 Pa. 337; Downey v. Hoffer, 110 Pa. 109.

      John Weaver for appellees.
    All of the Pennsylvania cases recognize that where the policy of insurance gives the insured permission to change the name of the beneficiary he may do so without notice to the beneficiary, and that if the policy does not give such permission the name can be changed by the insured with the consent of the beneficiary: Waltz v. Mutual Aid Society, 5 Pa. C. C. Rep. 208; Scott v. Dickson, 108 Pa. 6; Fisk v. Equitable Aid Union, 20 W. N. C. 290.
    The trustee took no interest in the policy: In re McDonnell, 4 Am. Bankcy. Rep. 92.
    April 10, 1905:
   Opinion by

Mb.. Justice Brown,

All that we know of plaintiff’s case is gathered from his statement of his cause of action. On the demurrer to it by the appellees the judgment below was in their favor, and, if no good cause of action against them was set forth in the statement, their demurrer was properly sustained.

Mary Myers was adjudged a bankrupt December 19, 1899. At that time she was named as the beneficiary in four insurance policies that had been issued by The Equitable Life Assurance Society of the United States on the life of "her husband, Abraham H. Myers, the aggregate amount of the insurance having been $13,000. On February 26,1901, she and her husband, as the assured, made an assignment of the policies, without any consideration, to Lillie Myers, Elsie Myers and Bella Myers, admitted on the argument to be their daughters. The policies of insurance were nob scheduled by the bankrupt as a part of her estate, and the plaintiff, who had been duly appointed her trustee in bankruptcy, had no knowledge of their existence, nor of the assignment to the appellees, until after the money had been actually paid to them by the insurance companies upon the death of Abraham H. Myers, which occurred on or about February 28, 1901. These are the facts upon which the plaintiff relies to recover from the defendants the proceeds of the policies that were paid to them. His claim is based on section 70a of the bankrupt act of July 1, 1898.

If Mary Myers had such an interest in the policies as amounted to property which she “ could by any means have transferred, or which might have been levied upon and sold under judicial process against ” her, her title to such property vested in her trustee in bankruptcy as of the date she was adjudged a bankrupt. Such are the words of the act of congress upon which the appellant relies and in which there is a reference to insurance policies held by bankrupts. But before a trustee in bankruptcy can lay his hands on a policy of insurance, or the proceeds of it, if paid to another than the bankrupt, as being assets of the estate to be distributed among the bankrupt’s creditors, he must be able to prove that the policy belonged to the bankrupt, having to him some value—either a cash-surrender value, payable to himself, his estate or personal representatives, or an actual value, of benefit to his creditors, if the proviso in section 70a of the bankrupt act is not an exclusive definition of what class of policies vest in the trustee: In re Slingluff, 5 Am. Bank. Rep., 76. If there must be proof of ownership by the bankrupt of property of value to him or his estate, there must be allegation of it in the pleadings. The only allegation of any interest of this bankrupt in the policies of insurance is that she had been named as a beneficiary in them. Under what terms and conditions had she been so named ? What may have been the reserved right of the husband, on whose life they were issued, to name another beneficiary in her place? As the assured, he assigned the policies to his children, and in the assignment, it is true, his wife joined. But was her joining necesssary to enable him to assign them ? Copies of the policies are not attached to the statement, nor is there any reference to their terms and conditions, and the mere naked allegation of the wife’s beneficial interest in them, without defining, or attempting to define, what that interest was, is not an allegation that she had “property in them which, prior to the filing of the petition in bankruptcy, she could by any means have transferred, or which might have been levied upon and sold under judicial process against her.” Unless she had property in them, no assignment by her alone would have been in fraud of the rights of creditors, for she would have assigned nothing that would have been of any value to them; and before these appellees can be compelled to pay to her creditors the money which they received as insurance on their father’s life, it must affirmatively appear that their mother gave them what belonged to her creditors. This does not appear here, and we affirm the judgment because the second and sixth grounds of demurrer were well taken. The other questions discussed by the appellant and appellees are not properly before us on the facts as they appear in the plaintiff’s statement. We confine ourselves to a consideration of what we there find. A discussion of anything else would be on a conjecture of what were the terms and conditions of the policies relating to Mary Myers, the beneficiary named therein.

Judgment affirmed.


author: Mr. Justice Brown,

text:
    Philadelphia to use v. Neill and Lincoln Savings and Trust Company, Appellant.

      Municipalities—Municipal contract—Contractors’ bonds.

    Where the condition of a city contractor’s bond is that he will “promptly pay or cause to be paid to any and all persons, any and all sum or sunis of money which may be due for labor and materials furnished and supplied or performed in and about” the paving of a street named, and in a suit on the bond the testimony shows that the plaintiffs supplied the contractor with bricks which were used in paving the street named, the plaintiffs are ■within the protection of the bond.
    In such an action the defendant cannot say that the suit is not on the bond, where the statement avers the conditions under which the bond had been given, and then avers a breach of it as a ground of the complaint, and the bond itself, at the trial, is offered in evidence in proof of the defendant’s liability to the plaintiff.

      Evidence—Promissory notes—Checks—Payment—Absolute payment—Burden of proof.

    To make a note or check payment absolute, there must be an express agreement by the creditor to receive it as such, and the burden of proving this is upon the debtor.

      Evidence—Complicated accounts—Necessity for expert—Discretion of court.

    Whether accounts are of such a complicated nature as to call for explanation by an expert accountant is a matter largely in the discretion of the trial judge.

      Trial—Beading statement and affidavit of defense to jury—Charge.

    On the trial of an action of assumpsit where there is no dispute as to the amount of plaintiff’s claim, no harm is done by the trial judge in reading the statement of claim and affidavit of defense to the jury.

      Trial—Charge—Municipal bond.

    On the trial of an action on a bond of a municipal contractor no harm is done by the court in referring, simply as an illustration, to a similar suit between the same parties, and this is especially so where the facts as to this suit were developed by the party complaining in the cross-examination of a witness of the opposing party.
    Argued Jan. 23, 1905.
    Appeal, No. 142, Jan.T., 1904, by defendant, from judgment of C. P., No. 3, Phila. Co., June T., 1903, No. 294, on verdict for plaintiff in case of Philadelphia to use of McAvoy Vitrified Brick Company v. Aaron M. Neill and the Lincoln Savings & Trust Company.
    Before Mitchell, C. J., Pell, Brown, Mestrezat and Elkin, JJ.
    Affirmed.
    Assumpsit on the bond of a municipal contractor. Before McMichael, J.
    At the trial counsel for plaintiff offered in evidence the bond.
    Mr. Porter: I object to the admission in evidence of this paper because it has been stated by counsel that it is the foundation of his action and he has not pleaded the bond as the basis of his action. One other objection is that this bond which is attempted to be offered is not in accordance with the terms of the ordinance of 1896. And another ground of objection is that under the ordinance of 1885 the bond itself must be drawn in the office of the city solicitor and that has not been shown.

      Objection overruled and bond admitted in evidence. Exception for defendant. [1]
    A witness for defendant was asked this question:
    “ Q. What does your examination of those books show after deducting the note of $8,000 which has been referred to in the testimony?”
    Objected to.
    Mr. Porter: I offer to prove by the witness upon the stand that he is qualified as an expert accountant; that he has examined the ledger, cash book and journal of the plaintiff company in the account with Neill, one of the defendants; that the result of his examination of those accounts shows that crediting the $3,000 note spoken of, and as to which certain testimony has been adduced as to its acceptance as payment, shows that the total balance due by Neill to the plaintiff company other than upon obligations still retained by the plaintiff company amounts to $346.49.
    Objected to.
    The Court: I sustain the objection. I do not think expert testimony is necessary or admissible here.
    Exception for defendant. [2]
    The court read to the jury the statement of claim and affidavit of defense. [3, 4.]
    The court charged in part as follows:
    Now, gentlemen of the jury [it has been objected, first, that the statement is not a suit upon the bond of the Lincoln Savings and Trust Company. Questions of law are for the court and not for the jury, and with the question of the sufficiency of the legal pleadings you have nothing to do, your function being to determine the questions of fact which will be left to you by the court for your determination. The trial judge is of opinion that the statement of claim is sufficient.] [5] It contains in substance the allegation of facts which are sufficient to enable the plaintiff to recover from the defendant, if properly substantiated by proofs and not overcome by countervailing proofs. If the statement be inaccurate in matter of form, it should have been attacked at an earlier stage of the case, either by a rule for a more specific statement or by demurrer.
    The system introduced by the ordinance of 1896 was, as is stated in the title of the ordinance, for the protection of subcontractors, as well as for persons furnishing materials and labor for the construction of buildings for the city of Philadelphia or for any other city work, and was to remedy an evil which had grown up, which resulted in great loss to mechanics and material men who supplied work and material to contractors for the city of Philadelphia, and also resulted in poor and skimped work for the city of Philadelphia. For, although the contractors with the city of Philadelphia were pretty sure to get their money if they completed their work according to contract, yet the subcontractors, material men and mechanics, who worked and furnished material for them, were often deprived of just payment for their work or materials, because dishonest or insolvent contractors refused or neglected to pay them, and there was no right of lien against a public work. And in the earlier suits upon bonds similar to the one given by the Lincoln Savings and Trust Company in this case, appeals were taken to the Supreme Court, and it was there settled that there was nothing ultra vires (that is, beyond the powers) or contrary to public policy in the city exacting from a contractor the condition that he should give a bond to pay subcontractors and material men. And it was further decided that where an ordinance requires a bond to be given by a -municipal contractor to secure payment to workmen, material men and subcontractors, and the ordinance provides that “ any person ” who has supplied labor or material shall be furnished with a copy of the bond upon application, and that such person “ shall have a right of action, and shall be authorized to bring suit in the name of the city; ” each person for whose benefit the bond was given may maintain against the contractor a separate suit in the name of the city to his own use.
    [And in a suit brought by the same plaintiff against the same defendants, in this same court, of the number and term immediately preceding the one on trial, an action upon a bond given by the defendants to the city of Philadelphia under the ordinance of March 30, 1896, for the protection of subcontractors and persons furnishing materials to contractors for city work, was sustained, the form of the action being similar to the present one.] [6]
    These and other questions of law have been ruled by me as trial judge, in accordance, I think, with the most recent cases in our Supreme Court, and, subject to review hereafter, you will take the law from me. But questions of fact are for the jury, and two questions of fact are for your determination in this case. [The first question of fact for you to determine is, what was the contract between the McAvoy Vitrified Brick Company and Aaron M. Neill? and the second is, were the bricks charged against Neill sold on his sole personal credit, or were they furnished and supplied to the work which Neill contracted with the city of Philadelphia to do, namely, the paving of Howarth street from Frankford avenue to Willow street ?] [7]
    I desire to call your attention to these two points and to the evidence which has been given in reference to them a little more distinctly. The testimony of the witnesses as to what the contract was between the McAvoy company and Neill does not seem to me to vary very much, both parties testifying, if my recollection is correct (though the ultimate recollection of testimony is always for the jury), that some time prior to the letting of the city contracts Neill went to the McAvoy company and asked for a price for vitrified bricks to be furnished in large quantities and was told the price would be $11.00 a thousand. Then bricks were furnished from time to time in large quantities, and prior to the letting of the city contracts Neill used the bricks for paving private streets, and, according to the testimony, paid for them. After the city contracts were let bricks were furnished to Neill f. o. b. the cars of the Reading Railroad at various points, and on the part of the plaintiff Mr. John C. McAvoy testified : “ Mr. Neill came to our office in the fall of that year (1899) and ordered from me personally 500,000 paving brick for the paving of Wake-ling, Howarth and Dyer streets. . . . He told me they were for those three streets. Those three streets were right together. The order was taken and the bricks were shipped to Frankford and used in the paving of those three streets. This one in particular, Howarth street, the brick was sent to him, and they were not paid for. . . . The brick was guaranteed to pave fifty-eight to the square yard, laid on edge as in paving.” And the witness further stated: “ I was on all three of those streets and I saw them paving the brick on those streets. It was my business to go on the streets at certain times.”

      There was also the testimony of the surveyor of the city that the amount of paving on Howarth street, including intersections, was 2660.75 square yards.
    Mr. John C. McAvoy was cross-examined, at considerable length, and it is for you to say whether or not his recollection is accurate, or whether he is telling the truth about it.
    [As to the amount of the claim, you will have to determine that from the data given. The bricks were sold at $11.00 a thousand. The testimony of Mr. McAvoy is that there were fifty-eight to the square yard, and there were 2660.75 square yards in Howarth street.] [8]
    There was other testimony which you may think was corroborative of Mr. McAvoy’s direct testimony—the testimony of Mr. Neill under cross-examination, and the testimony of Mr. Thomas B. McAvoy; or you -may think this testimony was contradictory of Mr. McAvoy’s. These witnesses were examined and cross-examined, and it is for you to determine how far their recollection of the facts is accurate.
    On the other hand, on the part of the defendant, there was an extended cross-examination of Mr. John C. McAvoy to show that the McAvoy Vitrified Brick Company has been paid, all except a small balance of some $300, for all the bricks furnished to Neill, and they claim that the books of the McAvoy company themselves and the whole testimony in the case show that nothing was due to the McAvoy Vitrified Brick Company for bricks furnished to Neill for paving Howarth street. This is a question of fact for you which you will determine from the whole evidence.
    [I declined the offer of expert testimony -to explain the books, because I did not think it was admissible, the accounts being not very complicated in their nature.] [9]
    There is one matter, I think, however, that I should allude to, and that is whether or not the promissory notes given by Mr. Neill were accepted in full payment for their face value.This is a question of fact for you to determine, but the law is that the note, even of a third party, is collateral security, or at most, conditional payment only. To make it payment absolute, there must be an express agreement by the creditor to receive it as such, the burden of proof of which is upon the debtor. [I leave it to you, however, as a question of fact under all the evidence to determine whether the promissory notes appearing in plaintiff’s account were taken in payment or not.] [10]'
    [Another question of fact for you to determine is as follows : Were the bricks used in the paving of this particular street sold to the defendant Neill on his individual credit and not for the paving of this particular street, and did the use plaintiff (that is, the McAvoy Brick Company) agree to look to the defendant, Neill, for payment therefor and not bring suit on the bond given to the city upon which suit is brought in the present case? This is the defense upon which one of the defendants, the Lincoln Trust Company, largely relied. One of the conditions of the bond of the trust company was to pay for labor and materials furnished and supplied in and about said work. If the bricks were not supplied in and about Howarth street, plaintiff cannot recover. The great advantage to the city of the ordinance ought not to be frittered away, but a general balance of indebtedness or a lunning account between merchants is not what was contemplated by the ordinance, nor is it within the terms of the bond. You have heard the cross-examination of the witnesses and Lave had the books of the plaintiff before you, introduced and offered by the defendant, without objection on the part of the plaintiff. These questions of fact have been fully argued. They are, perhaps, not without difficulty, but you should determine from the whole evidence, without prejudice and without sympathy, whether the plaintiffs furnished and supplied bricks to Howarth street], [11] the paving of which was the work contracted for between Neill and the city of Philadelphia, and also whether those bricks have been paid for or have not been paid for.
    Verdict and judgment for plaintiff for $2,045.50. Defendant appealed.

      Errors assigned were [1, 2] rulings on evidence, quoting the bill of exceptions ; (3-11) above instructions, quoting them.

      William W. Porter, for appellant.
    These bricks were not “furnished for the construction of the work.” They were sold to Neill, on his personal credit, entirely irrespective of any city contract, before he had such a contract, in the midst of a long running account. The sale was not on the faith of the “ penal bond: ” Philadelphia v. Stewart, 201 Pa. 526; Lancaster v. Ferscoln, 203 Pa. 640; Philadelphia v. McLinden, 205 Pa. 172.
    Under this act it was well settled that if the material was furnished on the credit of the contractor and not of the operation no lien would lie: Barclay v. Wainwright, 86 Pa. 191: Presby. Church v. Allison, 10 Pa. 413.
    There is a fatal variance between the allegata and probata ; Manufacturing Co. v. Welde, 196 Pa. 508; Ryder v. Jacobs, 182 Pa. 624-629; Noonan v. Pardee, 200 Pa. 474; Shaw v. Fleming, 174 Pa. 52.
    The breach of a bond must be alleged in the statement in clear and unequivocal language: Byrne v. Hayden, 124 Pa. 170; Clements v. Dempsey, 7 Pa. Superior Ct. 52; Commonwealth v. Whitesides, 1 W. N. C. 508.
    It is the general rule that where the condition of a statutory bond is harder than required by the statute, the bond is totally void and unenforceable: United States v. Tingey, 30 U. S. 115 ; United States v. Bradley, 35 U. S. 343 ; Com. v. Wistar, 142 Pa. 373.
    The question whether the notes and checks were taken as payment by plaintiff, and hence the surety discharged, should not have been left to the jury : Okie v. Spencer, 2 Whart. 253 ; Van Horne v. Dick 151 Pa. 341; Hummelstown Brownstone Co. v. Knerr, 25 Pa. Superior Ct. 465.
    Expert testimony as to the amount shown by plaintiff’s books of account to be due was improperly excluded.
    It was error for the trial judge to read the statement of claim and the affidavit of defense to the jury: Reese v. Hershey, 163 Pa. 253; Reel v. Martin, 12 Pa. Superior Ct. 340; Mellick v. Railroad Company, 17 Pa. Superior Ct. 12.
    The learned judge erred in speaking to the jury of a former recovery, in a similar action, between the same parties : Hyslop v. Crozier, 1 Miles, 267; Hasson v. R. R. Co., 21 W. N. C. 96 ; Reese v. Payne, 2 Kulp, 361; Gunzenhauser v. Stephens, 8 Pa. Dist. Rep. 684 ; Shaeffer v. Kreitzer, 6 Binn. 430.

      Edward A. Anderson, for appellees.
    This is not a mechanic’s lien and the decisions in reference to a mechanic’s lien are not applicable here. The contractor does not buy, nor the material men sell, on the credit of the street or bond. The subcontractor and material men have nothing to do with the bond. It is between the contractor and the city, taken by the city for the purpose of public policy, and it is a serious question if the subcontractor or material man could waive the benefit of its provisions if he wanted to : Philadelphia v. Neill, 206 Pa. 333.
    This whole argument is but rehashing the point that was decided against the contention of the appellant in the above case: Philadelphia v. McLinden, 205 Pa. 172.
    This bond has but one purpose and one condition, and that is the payment by the contractor of the debts incurred by him for labor and material under it, and the averment of nonpayment is an averment of its breach.
    These notes and checks were taken as promissory notes and checks are taken ordinarily as conditional payment to be good if "paid, and if not to have no effect: Phila. v. Stewart, 195 Pa. 309; Kilpatrick v. B. & L. Assn., 119 Pa. 30.
    As to the offer of expert testimony there was absolutely no foundation for it: Ryder v. Jacobs, 182 Pa. 624.
    The sixth point made by the defendants is that the trial judge read the statement and affidavit of defense to the jury. We submit no damage was done to the defendants by this course : Reese v. Hershey, 163 Pa. 253 ; Mellick v. R. R. Co., 17 Pa. Superior Ct. 12.
    It is not error for the court to refer to a fact which has already been referred to by the counsel for the parties objecting to the reference: Gunzenhauser v. Stephens, 8 Pa. Dist. Rep. 684.
    April 10, 1905:
   Opinion by

Mr. Justice Brown,

The first of the seven reasons given by counsel for appellant why this judgment should be reversed is that the bricks were sold to the contractor on his personal responsibility, and not on reliance upon his contract with the city and the bond given by him in pursuance of it. This assumes a fact not found by tbe jury, and which, under the evidence, they were justified in not finding. There was testimony that Neill, the contractor, called at the office of the appellees and asked for a price on vitrified paving brick, which he wished to use at a later date in the highway department; that the price was given him and he became the successful bidder for paving a number of streets, among them Howarth street; that when he subsequently ordered the bricks he named the streets on which they were to be used, Howarth being one of them, and to this street the bricks were sent and used on it. The contractor was ask^d: “ Q. With the brick you bought from the McAvoy Brick Company you paved Howarth street from Willow to Frankford avenue?” and the answer was, “Yes, sir.” The condition of the appellant’s bond was that A. M. Neill, the contractor, would “promptly pay or cause to be paid to any and all persons, any and all sum or sums of money which may be due for labor and materials furnished and supplied or performed in and about ” the paving of Howarth street; and, under the testimony produced by the appellees, they can turn to tbe bond for protection.

Objection is next made that “ there is a fatal variance between the allegata and probata ”; and we are asked to say that the suit is not on the bond. We can hardly understand this, for the suit is plainly on it, and it was offered in evidence in proof of the appellant’s liability to the appellees. In setting forth their cause of action on the bond, the plaintiffs properly stated the conditions under which it had been given, and then averred the breach of it as the ground of their complaint. The statement is a careful piece of pleading and its material allegations were supported by proper proofs.

By the seventeenth assignment we are asked to say that the bond is void, because it is broader than .the form provided by the ordinance—so broad that it includes sub-subcontractors, and it is argued (1), that if the ordinance protects sub-subcontractors, it is void as against public policy, and (2), if the ordinance does not protect sub-subcontractors, but the bond does, then the latter is wholly void. These questions are not now before us. Neill was a contractor and the unpaid materials were furnished directly to him by the appellees. The ordinance and bond are for just such a case. Whether they protect sub-subcontractors we can only decide when that question arises. We pass upon nothing that is not before us.

Whether the notes and checks given by Neill to the appellees were taken by them as payment, in discharge of the surety on the bond, was a question of fact for the jury. They were instructed that, to make a note payment absolute, there must be an express agreement by the creditor to receive it as such, and that the burden of proving this is upon the debtor. This was correct: Philadelphia v. Stewart, 195 Pa. 309. The president and bookkeeper of the company both testified that the notes had not been accepted as payment, and Neill, the debtor, upon whom was the burden of showing that they had been so accepted, does not testify that they or the cheeks were so given and received.

In the judgment of the trial judge, the accounts of the appellees with Neill were not of such a complicated nature as to call for explanation by an expert accountant. Whether a contention is such as calls for expert testimony is largely in the discretion of the trial judge: Ryder v. Jacobs, 182 Pa. 624; and, in the present case, it is manifest that this discretion was wisely exercised.

The evident purpose of the trial judge in reading the plaintiffs’ statement and the defendant’s affidavit of defense to the jury was to let them know what the issue was. In Reese v. Hershey, 163 Pa. 253, relied on by appellant in support of the third and fourth assignments, the suit was for personal injuries and the court below was criticised for reading the averment of the unliquidated damages claimed, because such reading tended “ to get figures and amounts into the jury’s mind without evidence.” In the present case there was no dispute as to the amount of plaintiffs’ claim for the material furnished. The defense was that they had been paid, and, if not, that they were not protected by the bond. No conceivable harm was done the appellant in reading to the jury what the plaintiffs claimed and what the defendant said in reply. After all the testimony had been heard by the jury they simply had reimpressed upon them by the reading of the papers the issues between the parties. It was the court’s duty to do this in its charge, and, in doing so in the manner complained of, nothing in this dispute got into the jury’s mind that ought not to have reached it.

That portion of the judge’s charge in which he referred to the fact that these plaintiffs had recovered from the same defendants in an action on a bond given to the city of Philadelphia under the ordinance of March 30, 1896, must be read in connection with what preceded it. He was simply instructing the jury as to the law of. the case, and they were told that there could be a recovery on such a bond as had been given in this case, an illustration being the recovery in another suit which had been sustained. But they were further told that these plaintiffs could not recover unless they found from the whole evidence that the bricks for Howarth street had been furnished by them and the same had not been paid for. Another reason why the appellant should not complain of the reference to a recovery against it in another suit, is the fact that it developed this in its own cross-examination of one of appellees’ witnesses. This disposes of all the assignments. They are overruled and the judgment is affirmed.