text:
    Commonwealth, Appellant, v. Randall.

      Taxation — Collateral inheritance tax — Classification—Stepchildren.
    1. The Act of April 22, 1905, P. L. 258, exempting stepchildren from the collateral tax on devises and bequests to them from stepparents does not offend against the constitutional requirement as to uniformity-in taxation.
    2. Classification is a legislative question, subject to judicial revision only so far as to see that it is founded on real distinctions in the subjects classified, and not on artificial or irrelevant ones used for the purpose of evading the constitutional prohibition. If the distinctions are genuine the courts cannot declare the classification void, though they may not consider it on a sound basis. The test is, not wisdom, but good faith in the classification.
    Argued March 26, 1909.
    Appeal, No. 102, Jan. T., 1909, by plaintiff, from judgment of C. P. No. 4, Phila. Co., March T., 1908, No. 4,497, for defendant on case stated in suit of Commonwealth v. Washington West Randall.
    Before Mitchell, C. J., Fell, Mestrezat, Elkin and Stewart, JJ.
    Affirmed.
    Case stated to determine liability for collateral inheritance tax.
    From the case stated it appeared that the defendant’s step-. mother had devised to him real estate in the city of Philadelphia appraised at the value of $35,000. The commonwealth claimed $1,750, as collateral tax thereon. The case turned upon the constitutionality of the Act of April 22,1905, P. L. 258, exempting stepchildren from the collateral tax on estates left to them by stepparents.
    The court entered judgment for defendant.

      Error assigned, was in entering judgment for defendant.

      M. J. O’Callaghan, with him J. Lee Patton, for appellant.
    We contend that the legislature had no power under the constitution of 1874 to pass the act exempting children of a former husband or wife even if the language and the parties intended to be relieved is clearly stated: Ayars’s App., 122 Pa. 266; Cope’s Est., 191 Pa. 1; Strode v. Com., 52 Pa. 181.

      June 22, 1909:

      Joseph H. Taulane, of White, White & Taulane, with him Ernest E. Provost, for appellee.
    The act exempts stepchildren: Lloyd’s Est., 15 Pa. Dist. Rep. 932.
    The act is constitutional: Kittanning Coal Co. v. Com., 79 Pa. 100; Hawes Mfg. Co.’s App., 1 Monaghan, 353; Com. v. Foundry Co., 203 Pa. 302; Com. v. Brewing Co., 145 Pa. 83; Pittsburg v. Coyle, 165 Pa. 61; Com. v. Clark, 10 Pa. Superior Ct. 507; Com. v. Mackey, 222 Pa. 613; Mixter’s Est., 28 W. N. C. 182.
   Opinion by

Mr. Justice Stewart,

The power of the legislature to classify subjects for purposes of taxation has long ceased to be a matter of controversy. It is subject to limitation of course, and it is the limitation alone that concerns us here. We can do no better in this connection than repeat what was said by the present Chief Justice in Seabolt v. Northumberland County Commissioners, 187 Pa. 318, “Classification is a legislative question, subject to judicial revision only so far as to see that it is founded on real distinctions in the subjects classified, and not on artificial or irrelevant ones used for the purpose of evading the constitutional prohibition. If the distinctions are genuine the courts cannot declare the classification void, though they may not consider it on a sound basis. The test is, not wisdom, but good faith in the classification.” The present case arises under the Act of April 22, 1905, P. L. 258, amending the general collateral inheritance tax of Act of May 6, 1887, P. L. 79. This latter act, as has been repeatedly held, is but a re-enactment of the previous laws reducing them into one harmonious whole: Commonwealth’s Appeal, 128 Pa. 603. As under the previous laws estates passing upon the death of the party seized, whether by deed, will or under the intestate law, to collateral kindred, were grouped in one class subject to taxation, so in the act of 1887. If this line of distinction had been strictly observed, estates passing to husband and wife, or to the wife or widow of the son of the person dying seized would have been subjected to the tax; but by express terms, and for very obvious and just reasons, these were put in the exempt class. The act of 1905 simply adds to this latter class estates passing to “children of a former husband or wife.” The present case falls within its terms; the devise being to the stepson of the testatrix, the son of her husband' by a former marriage. That a classification determined by character or degree of kinship with the person whose estate is transmitted is neither irrelevant nor artificial, is too obvious to call for discussion. The distinction between lineal and collateral kindred is not only reasonable, but it is natural as well, and has the merit of being so clearly defined that under it there can be no uncertain frontier. Whether one claiming is within a particular class can never be a debatable question, the fact in regard to his relationship once being determined. Whatever departure by way of exception there may be from the general fine of distinction on which the classification is based, it too must be judged by the same test as is applied to the general scheme. If based on a genuine distinction, or some consideration which supplies a purpose other than an intention to evade the constitutional prohibition regarding uniformity in taxation, it will be upheld as within the legislative power and discretion. The primary distinction was disregarded in the case of husband and wife, yet it will hardly be contended that an artificial distinction was invented to bring those occupying this relation within the exempt class or that the legislature showed either lack of wisdom or good faith in so classifying them. The act of 1905 disregards the distinction and allows the exemption to stepchildren. The reasons for this particular legislation were not so cogent as those which prevailed to exempt property passing to husband and wife, yet the distinction here observed has still a basis in the marital and family relation, and it is upon this relation that the whole scheme of classification rests. With the wisdom of the legislation we have nothing to do; it is enough to know that it falls within the classifying power of the legislature, and therefore does not offend against the constitutional requirement as to uniformity in taxation.

Appeal dismissed at the costs of appellant.


source: Caselaw Access Project

author: Mr. Justice Stewart,

license: Public Domain

text:
    Rosenblatt, Appellant, v. Weinman.

      Partnership — Profits—Losses—Contract of indemnity.

    Where two persons enter into a contract under which one advances money which the other is to use in purchasing stock of a corporation, and it is agreed that the two shall divide the profits, but that the purchaser shall bear any loss that may result, the contract is not one of partnership as between the parties, but is a contract of indemnity under which the purchaser indemnifies the other party against loss in consideration of the privilege of sharing the profits. If no time is specified for the termination of such a contract, either party may terminate it upon notice to the other, but such notice must be explicit and unequivocal, and of such a character as to leave the party notified no excuse for misinterpreting or misunderstanding it.
    Argued March 29, 1909.
    Appeal, No. 60, Jan. T., 1909, by plaintiff, from order of C. P. No. 5, Phila. Co., Dec. T., 1906, No. 1,094, refusing to take off nonsuit in case of Lizzie Rosenblatt to use of Benjamin Rosenblatt v. Harry Weinman.
    Before Mitchell, C. J., Fell, Mestrezat, Elkin and Stewart, JJ.
    Affirmed.
    Assumpsit for money had and received. Before Ralston, J.
    The facts are stated in the opinion of the Supreme Court.

      Error assigned was refusal to take off nonsuit.

      Emanuel Furth, with him David Bortin and Jacob Singer, for appellant.
    A partnership without limitation as to time is construed as one at will and may be dissolved at any time by either partner giving notice to his copartner of his intention so to do: Marston v. Gould, 69 N. Y. 220.
    The nearest case on the subject in our state is: Plumly v. Plumly, 6 Pa. C. C. Rep. 72.

      Julius C. Levi, for appellee,
    cited: Fry v. Potter, 12 R. I. 542; Hourquebie v. Girard, 12 Fed. Cas. 6,732; Williams v. Henshaw, 28 Mass. 79; Hubbell v. Buhler, 43 Hun (N. Y.), 82; Marston v. Gould, 69 N. Y. 220.

      June 22, 1909:
   Opinion by

Mr. Justice Stewart,

A nonsuit was directed in this case in the court below, and the appeal is from the refusal of the court to take it off. The facts briefly are these. In the latter part of 1899 the plaintiff advanced to the defendant $6,265 to be employed by the latter in the purchase of stock in the National Electric Company. The stock was purchased accordingly in defendant’s name. Later on plaintiff received from defendant this acknowledgment in writing signed by the defendant: “Philadelphia, Sept., 14,1899. Due to Lizzie Rosenblatt Sixty two hundred and sixty-five dollars, which was to be used to purchase 400 shares of National Electric Company stock and pay assessments on same. I agree to divide profits, if any, on same, and in case of any loss, I will assume all myself.” Shortly thereafter, with the consent of both parties, the stock so transferred was exchanged for its equivalent in the stock and bonds of another company into which the National Electric Company had been merged. On December 19, following, the defendant, at the request of the plaintiff, transferred the substituted stock and bonds to the latter’s husband, here the use plaintiff. The second day following the transfer plaintiff said to defendant that he “wanted the partnership dissolved or ended.” Suit was brought December 10,1906, to charge defendant with the difference between the original investment and the market value of the stock and bonds on the day when the use plaintiff expressed his desire to end the partnership, this difference as shown by the stock exchange quotations being $2,359. The plaintiff did not sell the stock and bonds, but, so far as appears, still held them at the time of bringing the action. Their present value does not appear. Plaintiff’s contention is that the contract was one of partnership; that the term of continuance being undefined, it was determinable at the pleasure of either party; that it being for a single transaction, and the amount due the withdrawing party being definitely ascertained, no accounting was required, and that therefore a right of action accrued immediately upon dissolution to the one withdrawing. That all this would follow were the contract one of partnership pure and simple may be conceded. In Galbreath v. Moore, 2 Watts, 86, it was held that an agreement between two individuals to enter into a single transaction of purchase for the purpose of profit, does not create a partnership such as will confine the remedy of either to obtain the fruits of their purchase to an action of account render, and that an action of assumpsit can be maintained in such case. The relation of partnership does not necessarily here arise. There was in this case no community except as to profits. That this is an essential element in partnership is universally recognized, but the authorities agree that it does not create a partnership. As was said in Walker v. Tupper, 152 Pa. 1, its absence may be regarded as conclusive against the partnership, but its presence is not conclusive in favor. The rights of third parties are not here involved, and it is purely a relation between parties to the contract as affecting themselves that is to be considered. The defendant had no property in the stock; he was to contribute nothing whatever either in money, skill or service to the undertaking; he was to share equally in the profits, if any, and to bear all loss. It is true that sharing in the profits ordinarily gives rise to a strong presumption of partnership where the rights of third parties are involved; but where the controversy concerns none but the parties to the contract, and can be settled by an action of assumpsit by one 'against the other, there would seem to be no reason to resort to the rules of partnership to determine their respective rights. As we view this contract it contemplated no partnership, as that term is ordinarily understood, but was simply a contract of indemnity against loss, the consideration moving to the indemnitor being the privilege of sharing in expected profits. But whether a partnership, or what has latterly .become distinguishable therefrom as a joint adventure, or a contract of indemnity, this much is clearly deducible from the contract itself — no date being fixed for the determination of the contract, whatever it was, it rested with either party to end it at his pleasure; and when ended the rights of the parties became fixed. No more was it in plaintiff’s power to continue defendant’s obligation to indemnify beyond such time as he chose to call for a settlement, than it was in the defendant’s power to require the plaintiff to hold the stock for a longer period than the latter desired. The contract relation was to end some time, and, in the absence of any provision fixing the date, the law will imply that it was determinable at the pleasure of either, providing good faith be observed. The only question in the case is, did the plaintiff by any certain, positive declaration or act terminate the contract on December 20,1900? He admitted that he did not sell either stock or bonds, though both were in his name and subject to his disposition. So far as appears he is retaining them to the present time, with what result as to profit or loss of course we do not know, nor does it concern us. Whether his action could be maintained depended on what transpired on December 20,1900, and for this we have the testimony of the plaintiff himself. It will not lengthen this opinion unduly to give his testimony in full. “Right after they (stock and bonds) were transferred and I had them in my name I told them (defendant) I wanted that partnership dissolved or ended. I wanted to make good, I wanted my money instead of the stock. He (defendant) said it was not convenient, you hold them, you will never lose anything, you have that agreement and they will be all right, I will never let you lose anything, or words to that effect, and we were friends until 1905.” It is impossible to gather from this an explicit and' unequivocal demand for an immediate termination of the relation subsisting. At most it was but an expression of the desire on the part of plaintiff to close out the transaction, and this was followed by an equally positive expression of unwillingness on the part of the defendant, on the ground of inconvenience at that particular time, and a request that plaintiff should continue to hold the stock on the assurance that defendant would not allow him to lose anything. No final conclusion was reached. The plaintiff made no reply indicating a rejection or refusal of defendant's demand, or determination to hold him for the loss as measured by the current quotations on the stock exchange that day. On the contrary, he says that thereafter he and defendant continued to be friends for five years, during which time he asked the defendant several times for a settlement, but in no place does he say that he made any demand for settlement as of December 20, 1900, or that the value of the stock on that day was ever spoken of by either. It was only after a controversy arose between them as to other matters, and after an interval of five years from the transaction, that plaintiff brought suit. A notice of a determination to end such a relation as existed here ought to be so explicit as to leave the party notified no excuse for misinterpreting or misunderstanding it. Such was not the case here. On the contrary, it was plainly tentative, and the only understanding to be derived from what occurred is that the conclusion reached was acquiescence in the continuance of the relation, especially in view of the fact that plaintiff continued to retain both stock and bonds. The sufficiency of the notice, the facts in regard to it being ascertained, was for the court, and we quite agree that in this case the notice was wholly inadequate to charge defendant with liability as of the date when the notice was given.

Judgment affirmed.


text:
    Paxson's Estate.

      Orphans’ court — Jurisdiction—Ownership of personal property — Decedents’ estates.

    1. Where personal property is included in the inventory of an executor, but is claimed by another person, the orphans’ court has jurisdiction to try and determine the question of ownership, inasmuch as the property is in gremio legis. In such a case the claimant may either proceed in the common pleas, or he may submit his claim to the orphans’ court. If he elect to pursue the latter remedy, he voluntarily brings himself and his cause within the jurisdiction of the court; he is not thereby creating a jurisdiction where none existed before, but adopting one already established.
    2. The case is very different where the disputed property has never been within the grasp of the court, but is in possession of one claiming adversely to the estate. In the latter case the orphans' court has jurisdiction of neither person nor thing.
    3. Where property is included in an inventory of decedent’s estate, but is claimed by another person, and on an issue a verdict is returned for the claimant and certified to the orphans’ court, a finding by the orphans’ court judge that the claimant owned the property based upon sufficient evidence and supported as to the credibility of the witnesses, by the verdict, will not be set aside by the appellate court.

      Appeals — Writ of error — Final judgment — Feigned issue.

      4. Where a verdict on a feigned issue has been certified back to the orphans’ court without any judgment having been entered thereon, no appeal in the nature of a writ of error can be taken to the common pleas. An appeal cannot be taken until a judgment has been entered.
    Argued March 30,1909.'
    Appeals, Nos. 91 to 100, inclusive, from decree of O. C. Phila. Co., April T., 1906, No. 11, dismissing exceptions to adjudication, and appeal, No. 101, by the Fidelity Trust Company, Executor of Edward M. Paxson, deceased, C. P. No. 2, Phila. Co., June T., 1907, No. 2,471 in the matters in the Estate of Edward M. Paxson, deceased.
    Before Mitchell, C. J., Fell, Brown, Mestrezat, Elkin and Stewart, JJ.
    Affirmed.
    Exceptions to adjudication.
    The opinion of the Supreme Court states the case.

      Error assigned in the appeal from the orphans’ court was in dismissing exceptions to the adjudication, and in the appeal from the common pleas various rulings on evidence.

      John G. Johnson, with him Henry D. Paxson and John Marshall Gest, for appellants.
    There can be no doubt, for all the books and cases agree, that an issue directed by the chancellor to the common-law court is simply for the purpose of informing his conscience. He is not bound by the verdict and if he is not satisfied with it, may order a new trial, or if he prefers, may decide at once in opposition to the verdict, as did, for example, Lord Brougham in Armstrong v. Armstrong, 3 Myl. & K. 45, and our Supreme Court in Baker v. Williamson, 4 Pa. 456. See also Brawdy v. Brawdy, 7 Pa. 157; McCarron’s Est., 17 Phila. 428; Green v. Mills, 103 Pa. 22; Wible v. Wible, 1 Grant, 406.

      June 22, 1909:
    The correct practice, followed here, is not to enter judgment on the verdict, because the judgment is not final: Finney v. Moore, 8 S. & R. 345; O’Connor v. Malone, 6 Cl. & Fin. 572; but the evidence was regularly certified to the orphans’ court along with the verdict, the charge of the court and the exceptions taken at the trial: Hallowell’s Appeal, 20 Pa. 215.
    Under the similar Act of June 16, 1836, secs. 87, 88, P. L. 755, Stewart’s Purdon, 1581, relating to issue on distribution of proceeds of sheriff’s sale, it was held that a writ of error was necessary as well as an appeal: Reed’s App., 71 Pa. 378; Providence Steam, etc., Co. v. Chase, 108 Pa. 319; Huggins’ Est., 204 Pa. 167; Thomas’s App., 124 Pa. 640; Thomas v. Thomas, 124 Pa. 646.
    In the settled language of the cases, the evidence must be “clear, precise and indubitable,” which this evidence was not: Ahlborn v. Wolff, 118 Pa. 242; Liggett v. Shira, 159 Pa. 350.

      Eugene Raymond and William W. Porter, for appellee.
   Opinion by

Mr. Justice Stewart,

In the case of Stroup’s Appeal, Estate of James Cutler, deceased, 225 Pa. 167, decided at this present term, the effort was, through the medium of the orphans’ court, to bring into an estate for the purposes of distribution property not included in the inventory or accounted for, but which the accountant claimed as her own. We there held that the court was without jurisdiction to determine the ownership of the property. Here the effort was to withdraw from the estate an item of property included in the inventory and fully accounted for. The distinction is to be noted. In the one case, except as the title was admitted to be in the estate or was so established at law, the court could not distribute it; in the other, the property being presumptively an asset of the estate, in the hands of the executor, accounted for and therefore in gremio legis, the court had full jurisdiction to adjudicate any question in regard to it which stood in the way of its distribution; it could even relinquish its control of the property if the legal right to it was with the claimant: Gaffney’s Estate, 146 Pa. 49. The party claiming property in the custody of the law is the actor; he has a choice of forum and remedy. He can elect to proceed at common law for money had and received, or he may submit his claim upon distribution proceedings in the orphans’ court, as was done in Gaffney’s Estate, supra. If he elect to pursue the latter remedy he voluntarily brings himself and his cause within the jurisdiction of the court; he is not thereby creating a jurisdiction where none existed before, but adopting one already established. The case is very different where the disputed property has never been within the grasp of the court, but is in possession of-one claiming adversely to the estate. In the latter case the orphans’ court has jurisdiction of neither person nor thing.

At the time Judge Paxson died he was the holder of a certificate No. 1,860, for 100,000 shares of the capital stock of the Amparo Mining Company. His executor, the Fidelity Trust Company, succeeding to this certificate of stock, included it in the inventory of the assets of the estate and has accounted for it. In the adjudication of the account John R. Williams appeared and made claim to the stock, alleging that he had pledged it as his own property to Judge Paxson as collateral security for a debt of the Amparo Mining Company which, since the death of Judge Paxson, the Amparo Mining Company had fully paid and discharged. He claimed the right to have the stock returned. Here was a case where the adverse claimant voluntarily elected his tribunal and submitted himself and his cause to its jurisdiction. That jurisdiction was complete as to the only question involved, viz., whether the stock should be surrendered, and that could be determined by the court upon its unaided investigation, that is to say, without the intervention of a jury. Whether a determination adverse to the claimant’s contention would be conclusive against him is a question aside from the present inquiry. The learned auditing judge, because the amount involved was very large and the evidence conflicting, directed an issue to the common pleas to try the question of fact upon which the contention turned. We quite agree that the case was pre-eminently one which called for an issue; but the fact remains that the jurisdiction of the court in no wise depended on the granting of the issue. A verdict was rendered sustaining the claim made by Williams. The record of the trial including the testimony and the charge of the court, having been certified back to the orphans’ court, the auditing judge thereupon proceeded with the adjudication. His final conclusion was as follows: “Being aided in reaching a conclusion by the verdict returned by the jury in the trial of said issue, and in view of all the facts exhibited and arguments presented, the auditing judge concludes that John R. Williams was entitled to said shares of stock.” A decree followed directing the executor of the will of Judge Paxson to transfer and assign the stock to Jennie R. Graham, executrix of the will of John R. Williams, and that the executor of Judge Paxson should have a corresponding credit in its account. From this decree we have an appeal, and a writ of error to the common pleas as well. The latter brings nothing before us for review. While there was a verdict in the issue, no judgment was entered thereon. It is said in appellants’ brief that it is the correct practice not to enter judgment on the verdict in such cases, for the reason that the judgment is not final, and for this Finney v. Moore, 8 S. & R. 345, is relied on. But that case furnishes no authority whatever for this view. There was a judgment in that case on the verdict, and it was reversed, not, however, because it was incorrect in practice to enter judgment, but because it was contrary to the agreement of the parties to the submission. Our attention has not been directed to a case where a writ of error has been considered which was not based on a judgment. The language of the Act of April 10, 1848, P. L. 450, Stewart’s Purdon, 1435, P. L. 6, is, “In all cases where a feigned issue has been or may be directed by the orphans’ court, a writ of error shall lie in the same manner as in cases where feigned issues are directed by the court of common pleas.” Turning to the Act of June 16, 1836, P. L. 755, sec. 87, regulating issues in the common pleas, we find it there provided that, “the judgment upon such issues shall be subject to a writ of error, in like manner as other cases wherein writs of error now lie.” There can be no doubt as to the general rule. “Error does not lie before final judgment, and this rule is founded on great reason, because there would be no end to suits if they might be removed to the Superior Court on suggestion, of error in every stage of the proceedings:” Lewis v. Wallick, 3 S. & R. 410. There being no judgment the effect is that there is nothing to review, and the verdict stands unappealed from. Not only was there no judgment, but we fail to discover a single exception taken to any ruling upon the evidence. All the evidence offered by the defendant in the issue was received, and none offered by the plaintiff was objected to. The exceptions are to the charge of the court and the refusal to give binding instructions. These were certified over to the orphans’ court with the record, and were for the consideration of the auditing judge in determining what weight he would give the finding of the jury. The exception to the refusal of the court to give binding instructions for the defendant could come to nothing, since binding instructions would have defeated the only purpose of the issue. What the auditing judge wanted was not the opinion of another judge, but a finding by the jury on the controverted facts. With respect to the charge the clear inference is that the auditing judge saw no substantial error in it, otherwise another issue would have been directed or the verdict disregarded. However this may have been, the auditing judge makes it very clear that while aided by the verdict the finding of the jury accorded with his own conclusions, “upon review of all the facts exhibited and arguments presented.” Sitting alone he had heard substantially the same evidence that was afterward submitted to the jury. He granted the issue because the evidence was conflicting, and because the case depended largely if not wholly upon the credibility of the witnesses called on part of the claimant. He was as he says aided by the verdict, but it is plainly manifest that the only aid he could have received from this source was the sanction given by the jury to the credibility of the witnesses, and it is not complained that this was influenced by the charge of the trial judge.

With a single exception all the assignments of error have regard to the trial of the feigned issue. In what we have said these have been disposed of. The first assignment complains of error in directing an issue; in other words, the contention here is that the evidence adduced on part of the claimant was insufficient to support a finding in his favor, and that the auditing judge should have so decided. The certificate was in the name of Judge Paxson and therefore imported ownership in him. Certain agreements and other documents in writing were relied upon as supporting this inference. It is argued that the case was precisely as though Williams had filed a bill to reform the written title to the stock, and had produced the same evidence in support of his claim. Assuming this to be so, there was quite enough in the evidence produced to sustain a finding in favor of the claimant. Two witnesses testified to distinct and unqualified admissions by Judge Paxson that he held the stock as collateral, and that it was to be returned to Williams upon the payment of the debt for which it was pledged. Respecting this testimony there could be no manner of doubt as to the stock and debt referred to; both were fully identified, and the circumstances under which the alleged admissions were made were fully narrated. The testimony certainly met the requirements as to clearness and precision; and it became a question simply as to whether the witnesses spoke the truth. If what they testified to was true in fact, there could be no escape from the conclusion that honesty and good faith required a surrender of the stock. All that is required in such cases is that the witnesses should be found to be credible; that the facts to which they testify are distinctly remembered; that the details are narrated exactly and in due order, and that their statements are true: Spencer v. Colt, 89 Pa. 314. The jury accredited the witnesses; the auditing judge was of the same mind as the jury, and the orphans’ court upon a review of the exceptions filed approved the finding. We see nothing in the case that would justify us in disturbing the result reached.

The writ of error for the reasons above stated is quashed and the appeal is dismissed at the costs of the appellants.


author: Mr. Justice Brown,

text:
    New York & Pittston Coal Company, Appellant, v. Hillside Coal & Iron Company.

      Mines and mining — Coal lease — Royalties—Sizes—Use of gangways.-

    1. Where a coal lease without definite terms and for the exhaustion of the coal, contemplates various sizes of coal, but provides for payment of royalties only on two sizes, pea coal being the smaller, no royalties can be collected on the smaller sizes known as buckwheat, rice and barley.
    2. A lessee of coal cannot be charged for rental for the use of gangways on the demised premises in transporting coal from other properties.
    Argued April 12, 1909.
    Appeal, No. 173, Jan. T., 1908, by plaintiff, from decree of C. P. Luzerne Co., Oct. T., 1903, No. 9; dismissing bill in equity in case of New York & Pittston Coal Company v. Hillside Coal & Iron Company and Avoca Coal Company, Limited.
    Before Mitchell, C. J., Fell, Brown, Potter and Elkin, JJ.
    Affirmed.
    Bill in equity for an account. Before Halsey, J.
    The opinion of the Supreme Court states the case.

      Errors assigned were in refusing certain requests for findings of fact and conclusions of law.

      B. R. Jones and Thos. H. Atherton, for appellant.
    A conveyance of coal in place is not necessarily a sale, and the rules applicable to sales are not to be applied indiscriminately to instruments which are leases, though in fact sales in form. Each instrument is to be construed like any other contract, by its own terms: Denniston v. Haddock, 200 Pa. 426; Gallagher v. Hicks, 216 Pa. 243; Coolbaugh v. Lehigh, etc., Coal Co., 213 Pa. 28; Hollenback Coal Co. v. Coal Co., 219 Pa. 124.
    On examination of the opinions of the court in Webber v. Vogel, 189 Pa. 156, it will be found that the decision in Lillibridge v. Coal Co., 143 Pa. 293, has been quite decidedly modified.

      June 22, 1909:
    S. J. Strauss and John McGahren, with them Willard, Warren & Knapp, for appellee.
   Opinion by

Mr. Justice Brown,

The court below refused to find that the culm bank, at the date of the agreement of December 14, 1888, and afterwards, belonged to the appellant, but did properly conclude, as a matter of law, from the evidence before it, that “the culm upon the premises whether mined by J. H. Swoyer and the Hillside Coal & Iron Company claiming under him prior to the lease of December 14, 1888, or mined by the Hillside Coal & Iron Company and the Avoca Coal Company after the lease of 1888, was the property of the Hillside Coal & Iron Company and the Avoca Coal Company respectively, paid for to the plaintiff by the royalties reserved respectively in the leases of November 12, 1868, and December 14, 1888.” This conclusion is not assigned as error. The Avoca Coal Company, Limited, one of the appellees, has accounted to and paid the Hillside Coal & Iron Company its lessor, the other appellee, for all coal taken by it from the culm bank of the. size of buckwheat and above, and the Hillside Coal & Iron Company, as the lessee of the appellant, has accounted to and paid it for all coal taken from the demised premises, including the culm bank, of the size of pea and above. The claim of the appellant is that it must be paid for all coal taken from the premises of a smaller size than pea resulting from the mining operations and known as buckwheat, rice and barley. Whether this claim is a valid one is to be determined by the terms of the lease by which each of the parties to it is bound, if they clearly and unambiguously set forth what the lessor is to receive as royalties and what the lessee is to get in consideration of their payment. The contention of the lessee, sustained by the court below, is that, having paid for all coal taken from the premises of the size of pea and above, there is no liability .to pay for the smaller sizes.

By its indenture of December 14, 1888, the appellant demised, leased and to mine let unto the Hillside Coal & Iron Company its successors and assigns, “all the merchantable anthracite coal in, under and upon” the described premises “which is accessible and minable by the ordinary processes of mining, together with the sole and exclusive right to mine and remove the same for the sole use and benefit of the second party, the lessee, upon the terms and conditions, and subject to the payment of the royalties named and provided for herein.” For all the merchantable coal upon the premises which the lessee was given the right to mine and remove its covenant was to pay twenty-five cents per ton for all above the size of pea, which is described in the agreement as that which passes over a mesh in the screen of three-fourths of an inch square in the clear, and for all pea coal twelve and one-half cents per ton, said pea coal being designated as such as will pass over a mesh in the screen of seven-sixteenths of an inch square and through one of three-fourths of an inch square. No term is fixed in the agreement during which the coal is to be mined. It is to continue until all the merchantable coal in the premises shall be exhausted by actual mining, and the lessor is not to resume possession until such coal is exhausted. If any question shall arise about the exhaustion of the coal, the agreement provides that it is to be settled by a board of arbitrators. That coal of smaller sizes than pea would result from the mining was clearly contemplated by the parties to the lease, for it was agreed “that the proportion of pea coal and the smaller sizes shall not be greater than that prepared at other collieries in the Wyoming valley in operation at the same time.” This clause covers the whole period during which the coal is to be mined, and during that period the sole and exclusive right of the lessee is to remove all the merchantable coal on the premises, without regard to the various sizes, its liability being to pay royalties only on two sizes. The lessor reserved no coal of any size to itself, but conveyed all of every size upon the one condition, that royalties should be paid only upon two sizes, and with this condition the lessee has complied and is complying. The distinction between the terms of this lease and the one in Hollenback Coal Co. v. Lehigh & Wilkes-Barre Coal Co., 219 Pa. 124 — the case upon which the appellant relies and these appellees stand — is so clear that we ought hardly be called upon to point it out. There the lease, for a definite period, stated in express terms just what could be mined and removed from the premises — a certain number of tons of coal of a certain size during each year of the term— and all of the coal was not to be mined. Here all can be mined and removed from the premises, and this is the end of any claim for royalties for sizes below those for which the lessee is to pay for the sole and exclusive privilege of mining and removing every pound of merchantable coal on the premises.

The claim for rental for the use of the gangways on the demised premises in transporting coal from other properties was properly disallowed: Lillibridge et al. v. Lackawanna Coal Co., 143 Pa. 293; Webber v. Vogel, 189 Pa. 156; and as to that made for the use of the surface in placing upon it coal transported from the other properties, the court propei’ly said that, even if the bill should be regarded as containing such a claim, there was no evidence upon which to base the measure of compensation.

The assignments of error are all dismissed and the decree is affirmed at appellant's costs.


author: Mr. Justice Potter,

text:
    Millum, Appellant, v. Lehigh & Wilkes-Barre Coal Company.

      Negligence — Infant—Land used as playground.

    1. Where the owner of property invites or permits its use by the public as a common or for a playground or a picnic ground, it is the duty of the owner to use reasonable precaution to protect the public from the operation of dangerous machinery located thereon. Under such circumstances, a different duty is imposed upon the owner, from that required of him towards those who are merely trespassers upon his property.
    2. Where an owner of a lot of ground permits it to be used as a public common or children’s playground and operates on such land moving wheels and moving ropes for raising coal without any guard or barrier around them, and a little boy four and a half years old is found fast in one of the wheels, severely injured, the question of the owner’s negligence is for the jury.

      June 22, 1909:
    Argued April 12, 1909.
    Appeal, No. 227, Jan. T., 1908, by-plaintiffs, from order of C. P. Luzerne Co., Oct. T., 1905, No., 491, refusing to take off nonsuit in case of Francis Milium by his next friend and father, Joseph Milium, and the said Joseph Milium, each in his own right, v. The Lehigh & Wilkes-Barre Coal Company.
    Before Mitchell, C. J., Fell, Brown, Potter and Elkin, JJ.
    Reversed.
    Trespass to recover damages for personal injuries. Before Fuller, J.
    The circumstances of the accident are stated in the opinion of the Supreme Court.

      Error assigned was refusal to take off nonsuit.

      James L. Lenahan, for appellants.
    My contention is, that the child was not a trespasser within the meaning of the case of Thompson v. B. & O. R. R. Co., 218 Pa. 444. It falls rather within the case of Henderson v. Refining Company, 219 Pa. 384; Rachmel v. Clark, 205 Pa. 314.

      Arthur Hillman, with him A. H. McClintock, for appellee.
    The nonsuit was proper: Rodgers v. Lees, 140 Pa. 475; Oil City, etc., Bridge Co. v. Jackson, 114 Pa. 321; Ritz v. City of Wheeling, 45 W. Va. 262.
   Opinion by

Mr. Justice Potter,

The dividing line between the principle upon which Thompson v. B. & O. R. R. Co., 218 Pa. 444, was based, and that upon which Henderson v. Refining Co., 219 Pa. 384, stands, may be a narrow one, but the distinction in principle between them may be readily traced. In the former case, the child who was injured, was considered as an intruder and a trespasser upon the property of the defendant company. In addition to this he was injured through the action of his playmates, rather than by reason of any machinery which the defendant company set in motion. Under the circumstances of that case, it was held that the property owner was not liable for the injury to an intruder, caused not merely by the condition of the premises as they were, but chiefly by the carelessness of other children, who were also intruders and intermeddlers. Upon the other hand, in Henderson v. Refining Company, 219 Pa. 384, it was considered that the child who was hurt by coming in contact with dangerous machinery, left unguarded, was lawfully upon the premises: that the defendant company in that case, which owned both the lot where the dangerous machine was erected, and the dwelling houses on each side of it, had, by placing a gate in the fence upon one side, and a door in the house upon the other, each opening upon the lot in question, and in addition, by permitting the lot to be used for passage between the two houses, and as a playground for the children living in them, thereby extended to tenants in the houses, to their families and guests, an implied permission to enter upon, or cross the vacant lot.

At the time of the trial of the present case, the decision in Henderson v. Refining Co., 219 Pa. 384, had not been handed down, and therefore it could not have been brought to the attention of the court below. We consider that it is controlling, as applied to the facts of the case at bar. Here the facts, as stated by counsel, are substantially as follows. The accident by which a little boy only four and a half years old, was most severely injured, occurred in a field, some fifty or sixty acres in extent, owned by the defendant company, and lying on the outskirts of the city of Wilkes-Barre. The field was for the most part open and unfenced and was used, apparently, as a common, and at times as a picnic ground, and for the purposes of a playground. At a certain point in the field was a bore hole, and to the west about a quarter of a mile away,- was an engine house of the defendant company. Between the engine house and the bore hole were a number of sheave wheels, placed on frames, about fifty feet apart, and varying in height. These wheels are of iron, about two feet in diameter, and with a flange to guide a wire rope, which passes over them from the engine house to the bore hole. The rope is used for raising and lowering coal, in the mining operations of the defendant. The accident occurred at the sixth pulley, or sheave wheel, from the bore hole, or about 300 feet from it. It appeared that this wheel was situated about fifty feet from the roadway, and the wire rope ran parallel with the roadway, for a considerable distance. The moving wheels and the .moving rope were uncovered, and were naturally dangerous to anyone who might come in contact with them. The little boy who was injured, lived with his parents, in a house some 500 feet away from the place of injury. No one saw the accident, but the child was found by two women, fast in the wheel. One witness testified that many children played on the premises, and held picnics there. He said children had been playing there for years; that the place was a regular common.

Where the owner of property invites or permits its use by the public, as a common, or for a playground, or a picnic ground, it is certainly the duty of the owner to use reasonable precautions to protect the public from the operation of dangerous machinery located thereon. Under such circumstances, a different duty is imposed upon the owner, from that required of him, towards those who are merely trespassers upon his property. The principle here involved was clearly set forth in Kay v. Penna. P. R. Co., 65 Pa. 269, where Justice Agnew pointed out, that while ownership of ground carried with it the right to use it in the way most convenient and beneficial to the owners, yet as he said (273): “the case is altered when, by a license to others, they have devoted this ownership to a use involving their interests and their safety ; and by sufferance permitted the public to enjoy a privilege of passage which might bring their persons into danger. Duties grow out of circumstances, the authorities tell us, and that which in one case would be an ordinary and proper use of one’s rights may, by a change of circumstances, become negligence and a want of due care.”

In the case at bar, the question to be determined, is, would an individual of common sense and ordinary intelligence, placed in the position of the defendant company, and possessing the knowledge which it must be assumed to have had, of the public use made of the premises, have seen that there was a likelihood of the uncovered machinery causing some injury to children resorting to the place, and using it as a playground; and would he then under the circumstances, have considered it a duty to put a stop to the public use of the ground, or to take ordinary precautions to prevent such an accident as that which occurred.

We are of opinion that this case should have been submitted to the jury under proper instructions from the court, for them to determine whether, under all the circumstances, the defendant company was negligent.

The judgment is reversed, with a procedendo.


text:
    Lenahan v. Crescent Coal Mining Company, Appellant.

      Negligence — Mines and mining — Failure to provide ambulance— Act of June 2, 1891, P. L. 176.
    In an action against a coal mining company to recover damages for the death of a boy alleged to have been caused by failure to provide an ambulance as required by sec. 1 of art. YII of the Act of June 2, 1891, P. L. 176, a verdict and judgment for plaintiff will be sustained where there is evidence that the boy was injured in the mine, after which he was left in the engine house about half an hour, then placed on a stretcher and carried to his home about a mile away; that during the journey the covering over him became wet and cold, and that in the opinion of a physician his death was “the consequence of shock as the result of exposure and accident.”
    Argued April 12, 1909.
    Appeal, No. 238, Jan. T., 1908, by defendant, from judgment of C. P. Luzerne Co., Oct. T., 1899, No. 829, on verdict for plaintiffs in case of Patrick Lenahan and Bridget Lenahan, his wife, v. The Crescent Coal Mining Company and Isaac B. Felts.
    Before Mitchell, C. J., Fell, Brown, Potter and Elkin, JJ.
    Affirmed.
    Trespass to recover damages for death of a boy fifteen years old. Before Lynch, P. J.
    The facts are stated in the opinion of the Supreme Court.
    Verdict and judgment for plaintiffs for $1,924.50. Defendant appealed.

      Error assigned was in refusing binding instructions for defendant.

      John T. Lenahan, with him Richard B. Sheridan, for appellant.
    Any conclusion that the weather conditions had anything to do with the boy’s death would be mere guess and speculation. In fact there is not a scintilla of evidence that the exposure to cold in any way affected the boy. He was well and carefully covered, and so far as the evidence in this case shows he was as comfortable as if in the conveyance required by the act.
    The evidence relied on to sustain the finding of the jury in this case is not nearly as strong as that in the case of Davis v. Penna. Coal Co., 209 Pa. 153.
    While the learned court correctly instructed the jury that the question for their decision was whether the boy would have lived if taken home in an ambulance as provided by the act, it was error to submit this question to their consideration, there being no testimony to support a finding by the jury on that question: Camden & Atlantic R. R. Co. v. Hoosey, 99 Pa. 492; Phila., etc., R. R. Co. v. Alvord, 128 Pa. 42; Musselman v. R. R. Co., 2 W. N.C. 105.

      James L. Lenahan, with him C. B. Lenahan, for appellees.
    In an action for death or permanent injury alleged to have resulted from an injury occasioned by defendant’s negligence, where there is a reasonable doubt whether the death or permanent injury resulted from the primary injury or came from other cause, is a question for the jury: Baker v. Pennsylvania Co., 142 Pa. 503; Brashear v. Philadelphia Traction Co., 180 Pa. 392; McCafferty v. Pennsylvania R. Co., 193 Pa. 339.
    The only Pennsylvania case we can find construing this statute, is that of Davis v. Pennsylvania Coal Co., 209 Pa. 163. Under that authority, we contend that Doctor Butler’s testimony was sufficient to send the case to the jury. The boy diéd before amputation was attempted.
    Under the authority as laid down in Wallace v. Pennsylvania Railroad Co., 222 Pa. 556, the court was clearly justified in leaving to the jury the question, whether or not the exposure was the approximate cause of death.
    June 22, 1909:
   Opinion by

Mr. Justice Potter,

The son of the plaintiffs in this case, a boy about fifteen years of age, was employed in the coal mine of the defendant, as a driver. He was struck by a runaway car, and severely injured. He was brought to the surface, and left in the engine house about half an hour, when he was placed ón a stretcher, two quilts thrown over him, and he was then carried by some workmen, a distance of about one mile, to his home. The day was cold and sleety, and the evidence tends to show that during the half hour required to make the journey, the clothing of the men, and the covering over the boy became wet and cold. A physician who was called to attend him, testified that, “The boy’s leg was so badly crushed that amputation was called for, was necessary. It was so badly injured and crushed that the only hope at all would be amputation. But he was in a dying condition at the time, dying as the consequence of shock, as the result of exposure and accident.”

The negligence charged against the defendant company, was its failure to provide an ambulance at its mine, as required by the Act of June 2, 1891, P. L. 176, sec. 1, art. VII, by which the boy might have been promptly and carefully removed to his home, after the injury. Counsel for defendant contend that the evidence that the death of the boy was due to this neglect to provide an ambulance, was not sufficient to be submitted to the jury. The trial judge instructed the jury that the substantial question in the case was, “Did this boy die by reason of the exposure to which he was submitted, by not being provided with an ambulance, or because of the injury inflicted by the car?” He then brought to their attention the testimony, as to the condition of the boy after he was struck by the car, and before he was taken home, and pointed out to them, that if the injuries were necessarily fatal, and if he would not have recovered, however carefully he might have been handled, during the removal, then the verdict should be for the defendant company; that the verdict could be in favor of the plaintiffs only, upon the proviso, that it was the exposure during the removal to his home, that caused the death of the boy.

In all this, we do not see that the trial judge committed any error. The question involved was one peculiarly appropriate for determination by the jury. The assignments of error are overruled, and the judgment is affirmed.


text:
    Stegmaier v. Keystone Coal Company, Appellant.

      Practice, C. P. — Pleading—Allegata and probata — Statement of claim —Evidence.

    1. The allegata from which the proofs must not materially vary, and with which they must be consistent, are those averments of fact contained in the plaintiff's statement of his cause of action which, if substantiated, would entitle him to recover. If the statement contain other allegations of fact not essential to the cause of action sued upon, the plaintiff is not bound to prove them, and failure to do so will not constitute a fatal variance which will preclude recovery if the essential averments have been duly established.

      Bonds — Negotiable instruments — Bailment—Pledge.

      2. Bonds of a corporation made payable to bearer are negotiable instruments, and a person who holds them as a pledge for an ovez-due debt has a right to sue upon them. He is not required as in the case of the pledge of ordinary chattels, to sell them and apply the proceeds to the payment of the debt, but he has the right to sue upon them and apply as much of the net proceeds collected as may be needed to pay the debt they were to secure. In such a suit the court will not consider whether the plaintiff is entitled to the whole amount of the bonds. If he is not, he will have to account as trustee for the excess to the proper owner in another proceeding
    Argued April 12, 1909.
    Appeal, No. 275, Jan. T., 1908, by defendants, from judgment of C. P. Luzerne Co., Oct. T., 1905, No. 283, on verdict for plaintiffs in case of Christian E. Stegmaier and Louisa S. Forve, Executors of Charles Stegmaier, deceased, v. Keystone Coal Company and Victoria Schmitt, Executrix of Estate of John A. Schmitt, deceased.

      Before Mitchell, C. J., Fell, Brown, Potter and Elkin, JJ.
    Affirmed.
    Assumpsit on a bond. Before Ferris, J.
    The court charged as follows:
    The testator of the plaintiffs, Mr. Charles Stegmaier, in 1905 brought an action against the Keystone Coal Company. About a year ago Mr. Stegmaier died and Mr. Christian E. Stegmaier and Louisa S. Forve, as executors of his will, were substituted as plaintiffs in the case for Mr. Charles Stegmaier, deceased. Also John A. Schmitt, who had become the purchaser of certain real estate of the Keystone Coa.1 Company subject to a mortgage, died in 1902, and Mrs. Schmitt, his widow, and executrix, applied to the court, by reason of the estate’s ownership of the property bound by the mortgage securing these bonds in suit, for leave to intervene and make defense to this action. That leave was granted by the court and she is here as an intervening defendant.
    The claim on which this suit was brought is that the defendant company, the Keystone Coal Company, is indebted to Charles Stegmaier or now to those who represent him, in a certain sum of money being the principal and unpaid coupons upon certain bonds of the Keystone Coal Company of which he, Mr. Charles Stegmaier, had in his lifetime become and was at the beginning of the suit, the lawful, legal owner and holder; and so the matter stood until the intervening defendant asked the court to require the plaintiffs to file a bill of particulars. This bill was required so that the defendant would have information to prepare for a defense. The bill of particulars was filed and set forth the manner in which it was claimed by the plaintiff that the fifteen bonds upon which the suit was brought came into his possession. Briefly, that bill of particulars asserted, that as to ten of the bonds, each of the bonds being of the denomination of 11,000, they were handed to Charles Stegmaier or Charles Stegmaier & Son, by Mr. S. L. Brown, five of them as collateral security for the indorsement by Stegmaier & Son, afterwards by Charles Stegmaier of a certain note made by Mr. Brown and of renewals of that note from time to time; together with an understanding that on nonpayment of the note, if Mr. Stegmaier was obliged to pay, the bonds put up as collateral should become his, belong to him, he should have the absolute estate in that property, and title to it. So also with the second five bonds of the first ten that I referred to; they were also upon another date in 1896 delivered as collateral security for a note then made by Mr. Brown and with a like understanding as averred. The third batch of five bonds it is alleged in the bill of particulars, were given to Mr. Stegmaier or Stegmaier & Son by Mr. Brown in October, 1898, as collateral security for Stegmaier's indorsement of a note not made by Mr. Brown but made by the Keystone Coal Company, of which note Mr. Brown was himself an indorser and that this batch of bonds also were delivered to Mr. Stegmaier as collateral security, with the understanding that if he, the pledgee of the bonds was obliged to pay that note of the Keystone company, then the bonds should belong to the pledgee after such payment. So the case stood on the pleadings. We then have the parties in court on the trial, and upon the trial, as you will remember, the plaintiff offered in evidence the several fifteen bonds upon which they claim the right to recover in this action, — bonds 9, 10, 11,12,13,20,78,79, 80,86,87,88, 89, 90 and 100. One of these bonds was read in your presence and it was agreed that they were all of like tenor and effect. These bonds provided for payment to Thomas Ford, trustee, or bearer. There was also a provision in the bond that on failure of the company obligor in the bond to pay interest due as per any coupon on the bond, upon presentment of it and a failure for ninety days thereafter, to pay, then the bond should be considered as matured and might be proceeded upon as though the entire period for which the bond was given had expired. No evidence was given of an actual demand for payment of any particular coupon, but evidence was offered, which under our law dispenses with a formal and actual demand; that is to say, evidence that no provision was made for the payment of the interest evidenced by these coupons, at the place where they were, upon their terms, made payable. A corporation bond made payable to bearer, as these were, is a negotiable instrument; quite as much so as a promissory note made payable to bearer would be. The possession of such an instrument is prima facie, as we term it in law, evidence of ownership upon the part of the person who has it in possession. These bonds were in the possession of the executors of Mr. Stegmaier’s estate and were produced here by them. The prima facie evidence, therefore, of ownership of these bonds and the right to them as absolute owners was made out and for that reason the court refused to grant a motion for a compulsory nonsuit. [The view which the court took of the bill of particulars was, that it did not, in the first instance, impose upon the plaintiff the burden of proving affirmatively everything which was set forth in the bill of particulars, but that all the burden which the plaintiff had to assume in the outset of the case, was to make out a prima facie case, enough to show a prima facie right to recover. Then the burden shifted over to the defendants. It was then for the defendants to show that the prima facie right which appeared to exist by reason of the possession of these bonds, did not in reality exist; the burden was upon the defendant to show by some evidence a state of facts which was inconsistent with the absolute ownership of Charles Stegmaier of these bonds at the time suit was brought.] [3] [Then as an admission of how these bonds came into the possession of Charles Stegmaier and by what right he claimed them, the bill of particulars was offered in evidence. Then followed the evidence on the part of the defendant, in pursuance of the burden which was cast upon them of showing that these bonds did not belong to Charles Stegmaier and that he had no such right to recover as his possession would indicate; and then evidence on the part of the plaintiff, in rebuttal, to uphold the right of Mr. Stegmaier to these notes. The defendant, in the opinion of the-court, succeeded in showing that the possession of these bonds did not evidence an absolute ownership of the bonds in Mr. Stegmaier, but that these bonds were in the hands of Mr. Stegmaier at the time of his death as collateral security for something. That in the opinion of the court is as far as the rebuttal of the prima facie case of the plaintiff went.] [4] [In the opinion of the court no evidence was produced to show that Charles Stegmaier knew that the person who pledged these notes to him had no right to do so; therefore, all that the evidence on behalf of the defendant could show would be that instead of being the absolute owner of these bonds, Mr. Stegmaier was the qualified owner of the bonds; that is, he was owner of them upon certain ’ conditions and for certain purposes only, namely, as collateral security. The testimony in rebuttal tended to show — -and I think some of that of the defendants tended to show — that certain notes which had been given and which it is claimed these bonds were given as collateral for, were not paid, were protested and that after protest Mr. Stegmaier took them up and paid the value of them, namely, $15,000 and interest.] [5] A holder of such securities as these, as collateral for an indebtedness, or a liability, may become the absolute owner of them upon failure of the pledgor to pay the debt for which they were pledged, by giving a notice to the pledgor to redeem his pledge, in effect saying to him I hold these bonds, let us say, as collateral security for your undertaking. You have failed, I claim the right to make the collateral which I hold available to collect upon it. I choose to do so by selling these bonds and I give you notice to redeem these bonds within a certain reasonable time fixed, otherwise I shall sell them. On giving such notice and on failure of the pledgor to redeem his pledge, then the pledgee would have a right, on proper advertisement, to sell these bonds and whoever bought at that sale would become the absolute owner of them. [He is not obliged to do that in the first instance, certainly not so far as the evidence in this case is concerned, where the property pledged is a negotiable instrument or instruments. These bonds were transferable by mere delivery, being made payable to bearer. They were instruments for the payment of money, each one stating that it was an obligation upon the part of the Keystone Coal Company to pay the sum of $1,000 at certain times or under certain circumstances, to Thomas Ford, trustee, or bearer, and then providing for certain action by the trustee to put these bonds into circulation. Each bond shows an indorsement by the trustee which in effect puts them in circulation so that these bonds were payable to bearer. As just stated they were for the purpose of evidencing a debt. The holder of them as collateral need not sell them in cases of that Kind, but he may still continue to retain them in his possession ás a pledge, in other words, as a trustee, and holding them as collateral security, he may proceed to collect upon them.] [6] To make this clear, let us suppose that instead of bonds of this character, a promissory note was given to Mr. Stegmaier as collateral. Let us say Mr. S. L. Brown’s or somebody else’s promissory note was given as collateral by Mr. Brown to Mr. Stegmaier and that note was to come due in sixty days from that time, and that the person who owed the money on that note was one who at the time was deemed to be responsible but whose credit possibly was not of the best. It would be the duty of the holder of that note as collateral security to proceed upon it to collect it, to present it for payment. If it was not paid and had an indorser upon it, to protest it and if necessary to sue the maker of the note of the indorser, and collect the money. He may not be neglectful, because if he were and because of that neglect that money was not eventually collected, and the pledgee lost it, the pledgor could hold the pledgee for it. [I merely instance this as an illustration of the principle that' the holder of collateral securities for the payment of money may collect the money on them and in some cases it is his duty to do so. That, I take it, was Mr. Stegmaier’s position at the time this suit was brought. He was the holder of these bonds as collateral security, under the evidence in this case — the prima facie case made out and the failure of the defendant to successfully rebut it. He therefore had a right to bring an action of assumpsit against the. Keystone Coal Company for the recovery of the amount of these bonds.] [7] It must be shown, of course, that they were due, either by their terms or by reason of nonpayment of the interest coupon. That has been doné. [So’ that as the case stands we think the plaintiff is entitled to recover in this action. If he obtains judgment under the verdict, which we direct you to render and proceeds upon that to sell the mortgaged property, his right in a distribution of the funds from the sale of that property would be, of course, measured by the amount of money which he would be entitled to receive on the notes which he took up and paid and the interest, together with the rights of other people as holders of these bonds who might be equally interested with him, — might have equal liens with him under the mortgage on the property sold. So that this suit does not finally decide the matter as to how much money shall be recovered eventually on this proceeding and proceedings which may result from it. But so far as this particular suit is concerned, we instruct you that your verdict should be for the plaintiff for the amount of these bonds and the unpaid coupons attached, up to the date of trial, which I understand to be $24,784.50.] [1]
    [What we have said to you makes it practically unnecessary to answer the points that have been presented by counsel with the request that the court instruct you as therein stated. So that we do not pass upon these points specifically, or answer them either by affirmance or denial specifically, except the fifth point presented by plaintiffs, which reads as follows:
    5. Plaintiffs, under all the evidence, are entitled to recover upon the bonds sued upon, the face value of the said notes and interest thereon from the date of the payment of the same by Charles Stegmaier.
    That we do not affirm as it is stated, but we do affirm it with the qualification that the plaintiffs are entitled to recover the face value of the bonds and unpaid coupons attached, up. to the date of trial, as against the Keystone Coal Company but not as against Victoria Schmitt.
    We therefore direct you to find a verdict for the plaintiff and against the Keystone Coal Company, for the sum of $24,784.50.] [2]
    Verdict and judgment for plaintiff for $24,784.50. Defendants appealed.

      Errors assigned among others were (1-7) above instructions, quoting them.

      John McGahren, with him Edmund G. Butler, for appellant.
    The presumption that the plaintiff by his possession of the bonds was an innocent holder for value was rebutted and overcome by his own admissions contained in his bill of particulars stating the basis of his title, which should be supported by affirmative proof. The presumption of absolute ownership was overcome when the defendants offered in evidence the plaintiff’s bill of particulars as the court very properly held. The scale was then turned and it became the duty of the plaintiff to go further and offer additional evidence to sustain the material averments in his bill of particulars: Adams v. Pease, 113 Ill. App. 356; Pusey v. Wright, 31 Pa. 387.
    The learned court should have instructed the jury that if they found under the evidence that the notes secured had been paid by Mr. Schmitt, the owner of the property mortgaged to secure the bonds, and by his executrix, the intervenor in this case, that then the plaintiff’s lien upon the bonds was discharged and that the executrix was entitled to a return of the same to her: Neiler v. Kelley, 69 Pa. 403; Diller v. Brubaker, 52 Pa. 498; Esser v. Linderman, 71 Pa. 76; Sitgreaves v. F. & M. Bank, 49 Pa. 359.

      William S. McLean, with him George R. McLean and William S. McLean, Jr., for appellees.
    Presumption was that bonds belonged to Brown, and Stegmaier and Son, by reason of their indorsements, were holders for value: Rice v. Southern Penna. Iron & R. R. Co., 9 Phila. 294; Gibson v. Lenhart, 101 Pa. 522; Justice v. Stroup, 4 Phila. 346; Carpenter v. Rommel, 5 Phila. 34; Kerr v. City of Corry, 105 Pa. 282.
    Holders of negotiable collateral security may sell the. same upon due notice or bring suit thereon: Davis v. Funk, 39 Pa. 243; Duffield v. Miller, 92 Pa. 286; Lishy v. O’Brien, 4 Watts, 141; Trust Co. v. Haser, 199 Pa. 17.
    No demand before suit brought was necessary: R. R. Co. v. Johnson, 54 Pa. 127.
    There was no material variance between statement and proof as to ownership of the bonds: Lishy v. O’Brien, 4 Watts, 141; Trust Co. v. Haser, 199 Pa. 17; Moore v. Baird, 30 Pa. 138; Hanna v. Holton, 78 Pa. 334.
    The suit was well brought on the bonds, although the property bound by the mortgage cannot be sold on execution issuing upon the judgment obtained on the bonds: Western Penna. Hospital v. Mercantile Library Hall Co., 189 Pa. 269.
    June 22, 1909:
   Opinion by

Mr. Justice Brown,

Notwithstanding the twenty-one assignments of error and the very elaborate argument of the learned counsel for appellants, this case is a very simple one, and the only real question before us is whether the court below, with the evidence before it, properly directed a verdict against the Keystone Coal Company. The action was brought by Charles Stegmaier against that company to recover $15,000 and interest on fifteen of its coupon bonds. These, for $1,000 each, were payable to Thomas Ford or bearer and were secured by a mortgage of the company’s property and franchises to the said Ford as trustee for the bondholders. The statement of plaintiff’s claim contained an averment that the bonds were due and payable and belonged to him. The property of the coal company covered by the mortgage became vested in John A. Schmitt, and, upon his death, Victoria Schmitt, his executrix, was, upon her petition, allowed to intervene as a defendant. On her motion a bill of particulars was filed, in. which the plaintiff averred that he had become the owner of the bonds by their delivery to him by one S. L. Brown as collateral security for his. indorsement of two of Brown’s promissory notes for $5,000 each and of one of the Keystone Coal Company for $5,000; that the bonds were pledged for the indorsement of each note and its renewals, with the understanding in each case that if the plaintiff paid the note or notes the bonds should belong to him. On the trial the substituted plaintiffs, the executors of the will of Charles Stegmaier, produced and put in evidence the bonds sued upon, with proof that they were due and payable before suit had been brought. This made out a .prima facie case against the defendants, who thereupon, upon the court’s refusal to enter a judgment of nonsuit, put in evidence the plaintiffs’ bill of particulars, to show admissions by them as to the manner in which they claimed the title to the bonds had been acquired. Further testimony in the case tended to prove that Charles Stegmaier, at the time he brought the suit, was the bona fide holder of the bonds as collateral security for his indorsements of the notes specified in the bill of particulars, which he had been obliged to pay; that when he took these bonds there was nothing to show that he knew Brown, who had pledged them to him, had no right to do so. The court, in its opinion refusing a new trial and judgment for the defendants non obstante veredicto, properly said that ho other conclusion could be fairly drawn from the evidence in the case.

One of the contentions of counsel for appellants is that a recovery ought not to have been permitted, because of the variance between the allegations and the proofs. In the statement the allegation is that the bonds belonged to the plaintiff at the inception of the suit; the averment in the bill of particulars is that they were held as collateral security under conditions which made them, at the time suit was brought, the absolute property of the plaintiff. The proof was that they were held as collateral security, and this was proof that they belonged to Stegmaier for the purpose for which they had been pledged. If either the statement or the bill of particulars contained averments not essential to a recovery, the plaintiffs were not bound to prove them. As to this the learned trial judge correctly said: “The allegata from which the proofs must not materially vary, and with which they must be consistent, are those averments of fact contained in the plaintiff’s statement of his cause of action which, if substantiated, would entitle him to recover. If the statement contain other allegations of fact not essential to the cause of action sued upon, the plaintiff is not bound to prove them, and failure to do so would not constitute a fatal variance which would preclude recovery if the essential averments have been duly established: Grubb v. Mahoning Nav. Co., 14 Pa. 302; Sidwell v. Evans, 1 P. & W. 383; Ins. Co. v. Flynn, 98 Pa. 627; Hastings v. Speer, 34 Pa. Superior Ct. 478.”

The bonds were of the same character as commercial paper, negotiable instruments passing from hand to hand by delivery or indorsement, and being of such a character, they gave to the holder of them a right to sue upon them. He was not required, as in the case of the pledge of ordinary chattels, to sell them and apply the proceeds to the payment of the debt, but had the right to sue upon them and apply as much of the net proceeds collected as might be needed to pay the debt they were to secure: Lishy v. O’Brien, 4 Watts, 141; Delaware County Trust, etc., Company v. Haser, 199 Pa. 17; Union Trust Company v. Ridgon, 93 Ill. 458; Colebrook on Collateral Securities (2d ed.), sec. 117.

Whether the plaintiffs, if they should recover the whole amount of their judgment, shall be permitted to retain the same is not a question involved in this proceeding. If the bonds were held simply as collateral, and that was the understanding between the pledgor and the pledgee, the appellees will have to •account, as trustees, to the representatives of Brown or to any other legal claimant to the surplus proceeds. This will be the subject of another proceeding, if there is a liability to account. The judgment here concludes no claimant who had an equity of redemption in the bonds.

The assignments of error are overruled and the judgment is affirmed.


author: Mr. Justice Elkin,

text:
    Rice v. Ruckle, Appellant.

      Equity — Equity practice — Pleading—Answer—Demurrer—Decree — Jurisdiction — Title to real estate.

    1. A decree on a bill in equity must conform to the prayers of the bill, and cannot be broader than the equitable relief prayed for.
    2. Where the averments of a bill in equity manifestly raise a question as to the title of real estate, the court of equity in which the bill is filed has no jurisdiction. The question of jurisdiction should be raised by demurrer, but may also be raised in the answer in certain cases in which it clearly appears from the whole record that equity does not have jurisdiction to determine the question in dispute; and if the question is so raised, the court cannot disregard it.
    Argued April 12, 1909.
    Appeal, No. 321, Jan. T., 1909, by defendants, from decree of C. P. Columbia Co., Dec. T., 1900, No. 2, on bill in equity in case of B. Frank Rice v. Harvey Ruckle et al., Executors of Wesley Ruckle, deceased.
    June 22, 1909.
    Before Mitchell, C. J., Fell, Brown, Potter and Elkin, JJ.
    Reversed.
    Bill in. equity for production of deeds, for an account and joint title. Before Evans, J.
    The case is stated in the opinion of the Supreme Court.

      Error assigned was the decree of the court.

      Fred Ikeler, for appellants.
    The court was without jurisdiction: North Shore R. R. Co. v. Penna. Co., 193 Pa., 641; Lazarus v. Coal Co., 221 Pa. 415.

      T. J. Vanderslice, S. P. Wolverton, S. P. Wolverton, Jr. and Grant Herring, for appellee.
   Opinion by

Mr. Justice Elkin,

The results secured by the decree entered in the court below are broad and sweeping. The bill averred title to four parcels of land to be in appellee who had purchased the right, title, interest and claim of Wesley Ruckle, deceased, in and to the lands in question at sheriff’s sale. Wesley Ruckle had no paper title to these lands in his lifetime, nor had any proceedings been instituted either before or after his death to perfect his titles, or to show that he or his estate had any interest in them. Some years after his death the appellee purchased some judgments of record against Wesley Ruckle, the lien of which had expired, revived the same by scire facias and caused whatever interest Ruckle had in the lands to be sold by the sheriff and became the purchaser at the sale. Appellee therefore holds a sheriff’s deed for whatever interest, if any, Wesley Ruckle may have had in the properties. At the time of the sheriff’s sale thet recorded titles stood in the names of the appellants,' or some of them, who were and had been for a number of years in actual possession. Under these circumstances this bill was filed praying for equitable relief, as follows, first, that the defendants be required to produce and bring forth conveyances, deeds and articles of agreement heretofore made; entered into or belonging to the said Wesley Ruckle, relating to these several tracts of land; second, that the defendants be required to account for the rents, issues and profits of said lands since the death of Wesley Ruckle; and third, that the defendants be required to perfect the title to said lands by good and sufficient conveyances and reconveyances thereof. The defendants filed an answer denying all the material averments of the bill and averring fee simple title and possession to be in Harvey Ruckle, one of the defendants as to some of the tracts, and in George Ruckle as to another tract. They also denied the jurisdiction of the court to grant the equitable relief prayed for. A referee was appointed before whom the testimony was taken on the issues of fact raised by the bill, answer and replication. The referee, after taking several years for consideration, made his report recommending that the court should enter a decree requiring possession of the several tracts to be given appellee; that the deed from Samuel Trump be reformed by striking out the name of Harvey Ruckle, and inserting the name of Wesley Ruckle and by changing the amount of interest conveyed and quantity of land included; that Harvey Ruckle be required to execute a quitclaim deed to appellee for an undivided one-half interest in one of the tracts; that George Ruckle, Sr., be required to execute and deliver to appellee a quitclaim deed for another tract known as the Bog lot; and that the defendants, jointly and severally, account' for the rents, issues and profits, the amounts being ascertained and apportioned. The learned court below accepted the report of the referee as to findings of fact and conclusions of law and entered the decree recommended. This brief recital of the nature of the pleadings and the contentions of the parties makes it perfectly clear that this is not a case for equitable jurisdiction. The prayers of the bill did not ask for nor contemplate any such sweeping results as the decree orders and directs. The first prayer requests that defendants be ordered to produce and bring forth certain conveyances, deeds and articles of agreements, alleged to be in their possession but belonging to the estate of Wesley Ruckle. The averments of the bill in relation to these matters were denied by the answer and there was no evidence to support the 'allegations. Hence the relief prayed for in this respect could not be granted. The second prayer requested an accounting for mesne profits, but whether there should be an accounting depends upon who owned the lands in question, and this was the matter in dispute throughout the whole controversy. The appellee was not entitled to an accounting for rents, issues and profits,' if he had no title, nor could the appellants be required to so account if in point of fact they were in possession under a. valid title. The third prayer asked that appellants be required to perfect title to the several tracts of land by good and sufficient conveyances and reconveyances to appellee. The decree of the court, however, undertakés to reform two deeds of record and grant other relief not prayed for. The reformation of a deed, solemnly executed and duly recorded, is a serious matter, and is never done unless the evidence be clear, precise and indubitable, and should not be áttempted without such relief is specifically requested.

The titles to four different parcels of land are involved in this controversy. These titles are derived from different sources and are vested in two different parties. No explanation is attempted to be made as to how all these questions involving title to different tracts of land can be raised and determined in a single bill in equity, or indeed how there can be jurisdiction in equity to determine the title to any single tract. As we view the case the whole controversy is one of disputed title,' and this question must be determined on the law side of the court. This is especially true because the question of title by adverse possession was very fully considered by the learned referee and is the only kind of title set up for one of the tracts in dispute and is relied on to sustain title to other tracts. It is certainly a novel proceeding to undertake to determine a question of title by adverse possession under a bill in equity. It is contended, however, that the question of jurisdiction should have been raised by demurrer and not in the answer. The appellant’s reply to this position is that the bill contained such sweeping allegations of fraud and mistake, clear grounds of equitable jurisdiction, that to have demurred would have been to admit these allegations in the first instance, which they could not do without prejudice to their rights. They were therefore by the necessities of the case put in the position of being compelled to specifically deny the allegations of fraud and to set up want of equitable jurisdiction in the answer. It is true the general rule is that the question of jurisdiction is properly raised by a formal demurrer to the bill, but in a number of our cases the right to raise the question without demurring has been recognized. In North Shore Railroad Company v. Penna. Company, 193 Pa. 641, it was held that where there is no jurisdiction the objection may be made at any time before or after final hearing, and where the question has been raised at every stage of the case from answer to final hearing, and disregarded in the court below, the question can be raised here, although a formal demurrer had not been filed on the service of the bill. All that was said in that case applies to the one at bar. The question of jurisdiction in the present proceeding was squarely raised before the referee and the learned court below. The record shows that it wás considered at length with the result that equity jurisdiction was sustained on the technical ground that a formal demurrer had not been filed. There is such a manifest want of jurisdiction to determine the questions of title here involved as to require that the case should be tried before a jury. In a very late case this court dismissed a somewhat- similar bill for want of jurisdiction where no formal demurrer had been filed: Lazarus v. Lehigh, etc., Coal Company, 221 Pa. 415.

Decree reversed and bill dismissed at the cost of appellee.