text:
    Barnes v. Rea, Appellant
    (No. 2).

      Contract — Option—Coal—Election to purchase.

    A contract under seal deliberately entered into whereby one party agrees to sell and convey coal to another upon certain terms and conditions, giving the other the option to purchase according to the terms of the agreement, is a contract binding on the landowner from the date of its execution, and becomes an absolute contract of sale binding on both parties if the election to purchase is made in accordance with its provisions.
    Where an option for the sale of coal provides that a portion of the purchase money shall be paid within a time specified, time is of the essence of the contract, and failure to make the first payment within the time specified works a rescission of the agreement and relieves both parties from the performance of the covenant.

      Where an owner of coal gives a written option to another for the purchase of the coal, and the agreement stipulates for the payment of a portion of the purchase money within a time specified, but no such payment or tender is made within the time stated, and subsequently .the optionee makes a tender, and several months thereafter the optionor acknowledges the original option agreement and the paper is recorded, the optionor will be deemed to have waived his right to rescind the agreement because payment was not made or tendered at the time specified.

      Statute of frauds — Memorandum, in writing — Description in writing— Equity — Specific performance.

    A contract for the sale of land in which the description lacks the certainty necessary to locate it is void. Words intended to be descriptive but which do not in fact describe so that the parties themselves or the courts can certainly determine from the instrument itself the tract of land to be conveyed or its location, are not sufficient to base a decree for specific performance. Descriptive language applicable to any one of several tracts of land cannot be supplemented by parol evidence as to what tract was intended.
    An agreement in writing to sell thirty-nine acres, more or less, of coal underlying a certain tract of land in a township, county and state named, without calling the tract by any name, or giving any adjoining owners, or fixing any natural boundaries, or designating in any manner in reference by deed, will, warrant, number, source of title, or in any other manner what tract of land was intended to be conveyed, is not a sufficient description under the statute of frauds.
    Where on a bill in equity for specific performance of a contract to sell land, objection is made before the end of the trial to the admission of the contract because of insufficiency of the description of the land, the appellate court can, upon an appeal, decide the question of the sufficiency of the description upon its merits; and this is the case although the statute of frauds was not pleaded in the answer, and the question was not raised by demurrer.
    Equity cannot decree specific performance of a contract in a case where the description of the real estate is insufficient.
    Argued Oct. 21, 1907.
    Appeal, No. 170, Oct. T., 1907, by defendant, from decree of C. P. Greene Co., No. 74, in equity, on bill in equity in case of James R. Barnes v. J. L. Rea, J. M. Hustead and I. W. Semans.
    Before Mitchell, C. J., Fell, Brown, Mestrezat, Potter, Elkin and Stewart, JJ.
    Reversed.
    Bill in equity for specific performance.

      Taylor, J., found the facts to be as follows:
    1. That Jesse L. Rea, one of the defendants, was seized in fee of a tract of land situate in Cumberland township, in Greene county, Pennsylvania, containing thirty-nine acres, more or less, and being so thereof seized, on June 2, 1899, entered into an agreement in writing with J. M. Hustead and I. W. Semans, two other defendants, to sell and convey, by deed with an abstract of title, to said Hustead and Semans, their heirs and assigns, all the nine-foot or Pittsburg vein of coal under the said tract of land, with the right to mine and remove all and every part of the same, without being required to provide for the support of the overlying strata or surface, and certain other mining rights, and reserving the privilege of operating for oil and gas on the same, which agreement and contract in figures, printed and written words, is as follows, to wit:
    “This agreement witnesseth, That J. L. Rea of Green County, Penn., hereby agrees to sell and convey to J. M. Hustead & I. W. Semans, their heirs and assigns, all the Mne foot or Pittsburg vein of coal in and under that certain tract of land in Cumberland Township, Green County, Pa., bounded by lands of ... . and containing thirty-nine (39) acres, more or less: The first parties reserving the privilege of operating for oil and gas on said farm. "With the privilege of reserving one acre of coal under said farm ; with the right to mine and remove all and every part of the same, without being required to provide for the support of the overlying strata or surface, and without being liable for any injury to the same to anything therein or thereon by reason thereof, and with all reasonable privileges for ventilating, pumping and draining the mines, and the right to keep and maintain roads and ways in and through said mines forever, for the transportation of the said coal, and of coal from and to other lands. Por which the party of the second part, their heirs or assigns, shall pay sixty dollars per acre, for each and every acre, as follows : One-fourth of the purchase money at the time of making and delivering of said deed and the balance in three equal annual payments from the date of said deed with interest at the rate of 5 per cent per annum on deferred payments. An abstract of title to be made to said J. M. Hustead & I. W. Semans, their heirs or assigns, when the first payment is made, and the others are secured by ... . mortgage on the property hereby sold. The .... of the second part .... heirs or assigns, shall have the right to take .... by paying .... per acre therefor at the time of taking, and when a deed is made. It is expressly understood and agreed that if the first payment aforesaid is not made on the second day of October, A. D. 1899, or within ten days thereafter, this agreement shall be considered as rescinded, and neither party shall be bound thereby.
    “ Witness our hand and seal this second day of June, A. D. 1899.

    2. That in consideration of the said coal and mining rights said Hustead and Semans, their heirs and assigns, were to pay the sum of $60.00 per acre for each and every acre, as follows: “ One-fourth of purchase money at the time of making and delivering of the deed, and the balance in three equal annual payments from the date of said deed, with interest at the rate of five per cent per annum on deferred payments, said deferred payments to be secured by mortgage on the property sold.” That by the terms of said agreement said Jesse L. Rea agreed to convey said coal and mining rights and privileges to said Hustead and Semans, their heirs and assigns, and to make an abstract of title.
    3. That on September 1, 1899, for value received, J. M. Hustead and I. W. Semans, assigned, transferred and set over to James R. Barnes, his heirs and assigns, all their right, title, interest, property, claim and demand whatsoever, of, in, to or out of the said agreement.
    J. That on October 11, 1899, James R. Barnes caused a notice in writing to be served upon L. M. Rea to the effect that the contract had been assigned by Hustead and Semans to him, and further notifying him that he accepted to purchase said coal under the terms specified in said contract, which notice was in words and figures as follows:

      “Mr. J. L. Rea,
    “ I hereby notify you that the option dated June 2, 1899, given by you to J. M. Hustead and I. W. Semans, for the coal therein mentioned in and under the tract of land in said option described, has been assigned to me by said Hustead and Semans, and I hereby further notify you that I accept to purchase said coal under the terms specified in said option. “Oct. 3, 1898. Jas. R. Bashes.”
    And that that notice of acceptance was served on Rea by Barnes in this particular case for the reason that Barnes was traveling through Greene county on the date of said notice, accepting other tracts of coal on which he had options.
    5. That on Juno 20, 1900, said James R. Barnes, plaintiff, caused a tender of $600 in gold to be made to the defendant, Jesse L. Rea, and demanded a deed for said coal and mining rights, which money so tendered he refused to accept and he also refused to make, execute and deliver a deed and abstract of title, both of which (deed and abstract) he had agreed and bound himself to make; a record of said tender and refusal to accept on the back of the agreement is in words and figures as follows:
    “July 20th, 1900. As attorney for Jas. R. Barnes I this day tendered J. L. Rea the sum of $600.00 in gold, as first payment on within coal and he refused to accept said money but admitted the amount was correct.
    “Thos. S. Oeago.”
    6. That on July 20,1900, the said Jesse L. Rea, in due form of laiv, acknowledged the said contract to be his act and deed and desired the same to be recorded as such.

      Error assigned among others was decree of specific performance.

      F. W. Downey, with him R. F. Downey, for appellant.
    We take the rule to be that the description of the real estate intended to be conveyed must be sufficiently definite that an officer could take a writ containing the description, and, by the description therein contained, locate the land: McCann v. Pickup, 17 Phila. 56; Mellon v. Davidson, 123 Pa. 298; Patton v. Develin, 2 Phila. 103; Soles v. Hickman, 20 Pa. 180; Cunningham v. Neeld, 198 Pa. 41.
    It is a rule in equity that the specific performance of a corn tract will not be decreed unless its terms are clear and capable of ascertainment from the instrument itself: Weaver v. Shenk, 154 Pa. 206; Moore v. Small, 19 Pa. 461; Owens v. Goldie, 213 Pa. 579; Friend v. Lamb, 152 Pa. 529; Swayne v. Swayne, 19 Pa. Superior Ct. 160; Baldridge v. George, 216 Pa. 231; Hammer v. McEldowney, 46 Pa. 334.

      Thomas S. Crago and James J. Purman, for appellee.
    The contract contains all that is necessary, and more too. It is a good, sufficient and enforceable contract: Cadwalader v. App, 3 W. N. C. 1; Colt v. Selden, 5 Watts, 525; McFarson’s Appeal, 11 Pa. 503; Tripp v. Bishop, 56 Pa. 424; Johnston v. Cowan, 59 Pa. 275; Smith & Fleek’s App., 69 Pa. 474; Peart v. Brice, 31 W. N. C. 336; Troup v. Troup, 87 Pa. 149; Henry v. Black, 210 Pa. 620.
    The statute of frauds was not pleaded: Luther v. Luther, 216 Pa. 1; Woods v. McMillan, 32 P. L. J. 363; Bishop v. Buckley, 33 Pa. Superior Ct. 123; Miller v. Piatt, 33 Pa. Superior Ct. 547.
    January 6, 1908:
   Opinion by

Mr. Justice Elkin,

The third, ninth, tenth, eleventh, seventeenth, twentieth, twenty-first, twenty-second, twenty-third, twenty-fourth and twenty-fifth assignments of error, in one form and another, raise the question whether the agreement, the specific performance of which is sought to be enforced in this proceeding, was an option to purchase or an absolute contract of sale. All that has been said in Barnes v. Rea, ante, p. 279, applies to the facts of this case, and for the reasons therein stated we sustain these particular assignments. It does not follow, however, that the decree must be reversed because of the error committed by the learned court below in holding that a binding contract had been entered into by the parties on the date rof.its execution, and that by reason thereof the covenants were mutual and dependent. It was clearly within the right of appellant to waive payment as a condition upon which the option could be exercised and to treat it as á valid existing agreement. This he did by acknowledging the agreement to be his act and deed before a notary public, thus declaring on the very day tender of a sufficient amount to cover the first payment was made to him, that he desired the instrument to be recorded as and for his act and deed.

The Twenty-second assignment relates to that clause of the agreement which provides that if the first payment is not made on October 2, 1899, or within ten days thereafter, it shall be considered as rescinded and neither party shall be bound thereby. The third request for findings of law asked the court below to hold that this was an independent covenant not dependent upon any other stipulation or covenant in the agreement. The learned court refused to so find, saying that while this covenant was intended and may be taken to act as a spur to the vendee in paying the purchase money, the vendor could have the advantage of it only by tendering performance on his part. This was error. The agreement was an option to purchase, and the clause in question contained the condition upon which it could be exercised so as to make it an absolute contract, binding on both parties. An option is not a sale. It is a right of election in the party taking the same to exercise a privilege, and only when that privilege has become exercised by acceptance in the manner specified in the agreement does it become an absolute contract, binding upon both parties. It is simply a contract by which the owner of property agrees with another person that he shall have the right to buy his property at a fixed price within a certain time. By such an agreement he does not sell his land, nor does he at that time enter into an absolute contract to sell and convey, but he does agree to sell something; that is, the right or privilege to buy at the election or option of the party with whom the agreement is made. The optionee under such an agreement takes, not lands, nor even an absolute agreement that ho shall have lands conveyed to him, but he does get something of value; that is, the right to call for a conveyance of the lands if he elects to purchase in the manner specified. The owner parts with his right to sell his lands, except to the second party, for a limited period. It is a unilateral- agreement containing the terms and conditions upon which the optionor agrees to sell and convey his land not yet ripened into an absolute contract to sell and convey on one side and to purchase and pay on the other. The covenants in such an agreement are not mutual, because mutuality imports an obligation on each party to do or permit to be done something in consideration of the act or promise of the other; that is, neither party is bound unless both are bound: Rivers v. Oak Lawn Sugar Company, 52 La. Ann. 762; Sizer v. Clark, 116 Wis. 534; Hopwood v. McCausland, 120 Iowa, 218; Hanly v. Watterson, 39 W. Va. 214; Ide v. Leiser, 24 Pac. Repr. 695; McMillan v. Philadelphia Co., 159 Pa. 142. If such an agreement is based on a valid consideration it is a binding contract and may be enforced: Johnston v. Trippe, 33 Fed. Repr. 530; Williams v. Graves, 26 S. W. Repr. 334; Corson v. Mulvany, 49 Pa. 88; Smith and Fleck’s Appeal, 69 Pa. 474; Yerkes v. Richards, 153 Pa. 646.

Nor must Henry v. Black, 213 Pa. 620, be understood as authority for a different doctrine. In the discussion of what constitutes notice and acceptance in that case, Minneapolis, etc., Railway Co. v. Rolling-Mill Co., 119 U. S. 149, was cited as authority for the rule that an offer to sell imposes no obligation until it is accepted according to its terms, and that so long as the offer has been neither accepted or rejected the negotiation remains open, and imposes no obligation upon either party; the one may decline to accept and the other may withdraw his offer. What was said in the federal case, and the reference to that decision in our own case, can have no application to the facts of the case at bar, because the negotiations in that case •related to the sale of personal property, while in this the agreement is to convey real estate. In that case* one party by letter offered to sell a certain number of tons of rails at a fixed price per ton, giving the other party the right to accept the offer within a definite period. All the negotiations were conducted by correspondence, and these facts were relied on by the federal court to support the rule laid down. That rule can have no application to a contract under seal, deliberately entered into by parties whereby one agrees to sell and convey coal upon certain terms and conditions, giving the other the option to purchase according to the terms of the agreement. Such a contract is binding on the landowner from the date of its execution, and becomes an absolute contract of sale binding on both, parties, if the election to purchase is made in accordance with its provisions.

In the present case, the agreement being an option to purchase and not an absolute contract to convey, time was of its essence, and failure to make the first payment within the time specified worked a rescission of the agreement, and relieved both parties from performance of the covenants. In other words, we hold that by the terms of the agreement itself, the payment of one-fourth of the purchase money within the time specified was the condition upon which the option could be exercised, and that it only becomes a contract inter partes when the election to purchase is made in the manner and upon the terms therein contained. While this would have been the situation of the parties if they had stood upon their legal rights as they existed on October 12, 1899, it appears neither party did so. On October 11, 1899, appellee caused to be served upon appellant a written notice of his election to take, which was followed by a tender of the amount of the purchase money due on July 20, 1900, at which time appellant in due form of law acknowledged the original agreement before a notary public. It does not appear that up to this time he did or said anything to indicate that he either demanded a rescission of the contract or treated it as rescinded. His acknowledgment of the original agreement several months after the date when he could have insisted upon a rescission, can only be construed as a waiver of his right to insist upon payment at the time specified and an affirmance of the contract. This he had the undoubted right to do, and there can be no question about his having done it. Having affirmed the agreement after he had the right to stand on a rescission, and having declared for public record that it was a binding existing agreement, he cannot now be heard to say that it had been rescinded at a prior date and neither party bound thereby. Both parties treated the agreement as a valid subsisting contract long after the time when appellant could have claimed a rescission, and we know of no reason why the law should undertake to say to them that the agreement was rescinded when they by their own acts declared it was not.

The fourth, thirty-first and thirty-sixth assignments raise the question of the sufficiency of description and statute of frauds as applied to the facts of this case. A contract for the sale of land in which the description lacks the certainty necessary to locate it is void. Words intended to be descriptive, but which do not in fact describe so that the parties themselves or the courts can certainly determine from the instrument itself the tract of land to be conveyed, or its location, are not sufficient to base a decree for specific performance. Descriptive language applicable to any one of several tracts of land cannot be supplemented by parol evidence as to what tract was intended: Mellon v. Davison, 123 Pa. 298; Soles v. Hickman, 20 Pa. 180; Peart v. Brice, 152 Pa. 277.

Ferguson v. Staver, 33 Pa. 411, and Smith and Fleck’s Appeal, 69 Pa. 474, are authority for the rule that parol evidence is admissible to supply the particular description of lands when the contract relied on described the subject-matter of the grant sufficiently definite to fix its location. The question to be determined in this case is whether an agreement to sell thirty-nine acres, more or less, of coal underlying a certain tract of land in Cumberland township, Greene county, Pa., without calling the tract by any name, or giving any adjoining owners, or fixing any natural boundaries, or designating in any manner by reference to deed, will, warrant, number, source of title, or in any other manner what tract of land was intended to be conveyed, is a sufficient description under'the statute. Or is such a description a sufficient identification of the property, the subject-matter of the grant, as to make it permissible to supply the particular description by parol evidence % We think not. When the statute required the contract to be in writing, it meant that the complete contract in all its essentials should be set forth in the writing itself. It must be self-sustaining under the rule of all our cases. Under the facts of this case parol evidence is not admissible to supply the particular description of the land, because the agreement lacks the certainty necessary to identify and locate the- land as a whole. It is very earnestly contended that appellant cannot insist upon this position now, because the statute was not pleaded in the answer, and that this question should have been raised, if at all, by demurrer. The question of the sufficiency of the description was raised in the court below after the admission of the agreement in evidence had been objected to, and before the trial closed, and we can see no reason why this question should not be decided upon its merits now. The question of jurisdiction was raised by the tenth paragraph of the answer to the bill, and about the only question of jurisdiction that could arise under the facts of this case is whether the agreement was within the statute of frauds. In Hammer v. McEldowney, 46 Pa. 334, it was held that equity would hot decree specific performance of a contract in a case where the description of the real estate was insufficient.

We cannot agree, therefore, that this question was not raised in the court below in such a manner as to have it decided here, and for this reason the decree must be reversed.

Decree reversed at the cost of the appellee.


source: Caselaw Access Project

author: Mr. Justice Elkin,

license: Public Domain

text:
    McHenry v. Mitchell, Appellant.

      Contract — Option—Sale of land — Intention.
    Whether an instrument in writing agreeing to sell and convey real estate shall be considered as an absolute conveyance, or only an agreement to convey, or an option to purchase, depends, not on any particular words or phrases, but on the intention of the parties to be derived from the instrument itself by a consideration of all its parts, and when that is doubtful, from the circumstances attending it.
    An owner of coal agreed in writing to sell the same to another person for a certain sum per acre, payable on or before three months from date, one-third at the time of the presentation and delivery of the deed, and other payments subsequently. A clause in the agreement provided:
    “That in case payment is notmade as hereinbefore stipulated then this agreement to be null and void and of no effect whatever, and all parties hereto to be released from all liability hereunder.” Held, (1) that the optionor could not assert a forfeiture on the ground of failure to make the payment within the time specified, if he failed to first present a deed for delivery within that time; and (2) that a notice given by the optionee within the time specified of his election to purchase was sufficient to require the optionor to tender a deed before he could assert a forfeiture for failure to make the payment within the time specified.
    Argued Oct. 21, 1907.
    Appeal, No. 39, Oct. T., 1907, by defendant, from decree of C. P. Indiana Co., Dec. T., 1904, No. 4, on bill inequity in case of S. M. McHenry v. Robert Mitchell.
    Before Mitchell, C. J., Fell, Brown, Mestrezat, Potter, Elkin and Stewart, JJ.
    Affirmed.
    Bill in equity for specific performance.
    Before Patton, P. J.
    The agreement sought to be specifically performed was as follows:
    “Article of agreement made November 23, 1900, between Robert Mitchell, of Indiana borough, Indiana county, and state of Pennsylvania, of the first part, and S. M. McHenry, of White township, Indiana county, Pa., of the second part: Witnesseth, that the said, party of the first part, for the consideration hereinafter mentioned, hereby agrees to sell and convey by deed of general warranty, clear of all incumbrances, unto the said party of the second part, his heirs and assigns, all the coal of whatever kind in and under all that certain tract of land situate in White township, Indiana county, and state aforesaid, bounded and described as follows : On the north by lands of James M. Campble, on the east by lands of M. F. Jamison and others, on the south by lands of J. H. Engle and Mrs.--Oatman, on the west by lands of W. J. Ray or-Smith, and containing one hundred and twenty-six acres, more or less.
    “ Together with the full, perpetual and exclusive right to enter in, upon, and under the said lands to dig, test, drill and explore for said coal, and to mine, remove and transport the same from this and other lands with the full privileges which are usual and necessary for mining purposes, without liability for damages.
    “ In consideration whereof, the said party of the second part, his heirs and assigns, agrees to pay, or cause to be paid, to the said party of the first part, $18.00 per acre for each and every acre of coal contained therein, on or before three months from date hereof, upon presentation and delivery of a good and sufficient deed, clear of all incumbrances; payments to be made as follows : One-third at time of presentation and delivery of the deed, one-third in one year with interest, one-third in two years, with interest from date of first payment with the privilege of paying in full at any time before maturity. Deferred payment to be secured by bond and mortgage on the coal.

      “ It is further understood and agreed, by the parties hereto, that in case payment is not made as hereinbefore stipulated, then this agreement to be null and void and of no effect whatever, and all parties hereto to be released from all liability herein.”
    The notice of election was as follows:
    “ Indiana, Pa., February 22,1901.
    “ Me Robert Mitchell,
    “ Dear Dir:
    “ Notice is hereby given that I elect to purchase the coal underlying your farm in the township of White, Indiana county, Pa., upon the terms mentioned in an article of agreement between us, dated November 23, 1900. You will please have your deed prepared according to the terms of that contract.
    “ Y ours very truly,
    “ S. M. McHenry.
    “ Served February 22, 1901, by reading the notice to Mrs. Robert Mitchell and daughter and leaving a true copy of the same at their dwelling house.
    “Jacob Wettling.”
    The court awarded a decree of specific performance.

      Error assigned was the decre of the court.

      D. B. Taylor, for appellant.
    The party seeking a specific performance, must show himself ready, willing, desirous, prompt and eager to do all essential and material acts required of him by the agreement at the time of commencing the suit: Neill v. Hitchman, 201 Pa. 207; Yerkes v. Richards, 153 Pa. 646; Weaver v. Sides, 216 Pa. 301; Verstine v. Yeaney, 210 Pa. 109.
    Before suing for specific performance, a vendee must tender performance, in accordance with the contract: Hughes v. Antill, 23 Pa. Superior Ct. 290.

      Ernest Stewart, with him John A. Scott, for appellee.
    appellee.If this agreement is an option, it cannot be distinguished in meaning from the agreement construed in Weaver v. Sides, 216 Pa. 301; Hampton v. Speckenagle, 9 S. & R. 212; Rawson v. Johnson, 1 East, 203; Wagenblast v. McKean, 2 Grant, 393; Eberz v. Heisler, 12 Pa. Superior Ct. 388.
    The positive refusal of vendor to make a deed waives the necessity of a tender of the purchase money on the part of the vendee.
    January 6, 1908:
   Opinion by

Mr. Justice Elkin,

We have just held in an opinion handed down that whether an instrument in writing agreeing to sell and convey real estate shall be considered as an absolute conveyance, or only an agreement to convey, or an option to purchase, depends, not on any particular words or phrases, but on the intention of the parties to be derived from the instrument itself by a consideration of all its parts, and when that is doubtful, from the circumstances attending it. This1 rule, as to conveyances generally, is as old as our state, but its application to the modern option is more recent. The soundness of the rule is in no way better proven than, in its application to options on real estate. Nearly all of the large transactions relating to the purchase of coal lands in the bituminous fields are conducted in this way, and there are about as many binds of options as there are persons engaged in that particular business. The method is a proper one and the benefits resulting to all parties are often substantial, and if the agreements are fairly and honestly made, generally satisfactory. But whether satisfactory or not, the law recognizes the right of a landowner to enter into such an agreement, and, in the absence of fraud, misrepresentation or mistake, will enforce the same according to its terms. The agreement in the present case, as indeed in almost every such case, contains words and covenants ordinarily used in absolute conveyances or in agreements to convey. Mitchell, the appellant, on his part agreed to sell and convey by deed of general warranty, all the coal and mining rights underlying the tract of land described in the agreement. McHenry, the appellee, on the other hand, agreed to pay, or cause to be paid, a certain sum per acre for each and every acre of coal therein contained, one-third at the time of the presentation and delivery of deed, one-third in one year, and the remaining third in two years, with interest from the date of first payment. If the parties had stopped after these covenants had been agreed upon there could be no doubt that their agreement would be construed to be an absolute contract to convey, binding on both parties. They, however, did not stop here, nor was it their intention to do so, because the clause which follows these covenants clearly shows that neither party considered it an absolute conveyance at that time. This clause provided, “ that in case payment is not made as hereinbefore stipulated, then this agreement to be null and void and of no effect whatever, and all parties hereto to be released from all liability hereunder.” When the parties wrote that clause into their agreement, they intended, and thus declared it to be their intention, that the instrument should be considered an option to purchase and not a binding contract of sale. McHenry had the privilege of electing to take within the time and upon the conditions specified, and not until he did so elect in the manner required, did the agreement, unilateral in the first instance, ripen into an absolute contract of sale. We do not understand that this position is seriously controverted. It must be now determined whether the option was exercised within the time fixed and in the manner required. The forfeiture clause provided that the agreement shall be null and void if “ payment is not made as hereinbefore stipulated,” and it therefore becomes necessary to look to other parts of the agreement in order to determine the time in which and the terms upon which the option could be exercised. The covenant as to payment required the optionee to pay “ eighteen dollars per acre for each and every acre of coal contained therein on or before three months from the date hereof upon presentation and delivery of a good and sufficient deed clear of all incumbrances.” Under the authority of Weaver v. Sides, 216 Pa. 301, this required him to exercise his election to purchase on or before February 23, 1901. This he did, or attempted to do, by having written notice served on appellant in the manner found by the learned court below. Time is presumably of the essence of this, and every other optional agreement, and always is when made so by the contracting parties. When the payment of the whole, or any part of the purchase price, on a day certain or within a time specified, is made a condition upon which the right of election to purchase depends, failure to make or tender payment on the day or within the time works a forfeiture of all rights under the agreement and the option is at an end. Of course, payment at the particular time may be waived or the acts of the parties may be such as to estop them from asserting a forfeiture. If the payment of money on a fixed date is required it must be paid or tendered on that date; or if notice in writing, or any other method is provided, the requirement must be met. The difficulty with the present case is that the forfeiture clause does not in express terms fix any exact date for payment, nor does it definitely provide how the option shall be exercised. This clause, taken in connection with the other parts of the agreement upon which the right to declare a forfeiture depends, can only be construed to mean that the optionee must elect to purchase within three months by the payment of one-third of the purchase money upon the presentation and delivery of a good and sufficient deed by the optionor. The parties themselves made their own agreement, and we know of no rule of law that would justify a court in making a new contract for them. A different question would be presented if the forfeiture clause required payment on a day cei’tain, without reference to the presentation and delivery of a deed; in which event payment must be made within the time, whether the deed be delivered or tendered or not.

Forfeiture clauses in optional agreements as a rule are independent covenants and do not relate to or depend upon covenants in other parts of the same instrument, and when so, they must be construed according to their own terms ; but when, as in the present case, the parties themselves in express terms provide in the option clause that the first payment shall be made as hereinbefore stipulated, and the covenant to which reference is thus made requires the presentation and delivery of a deed before payment can be demanded, the optionor cannot assert a forfeiture on the ground of failure to make the payment within the time specified, if he fails to first present a deed for delivery within that time.

In the case at bar we agree with the conclusion reached by the learned court below in which it was held that the notice given by appellee, within the time specified, of his election to purchase was sufficient under the circumstances to require appellant to tender a deed before he could assert a forfeiture for failure to make the payment within the time specified. We only reach this conclusion because the agreement in express terms so provides.

Decree affirmed at the cost of appellant.


author: Mr. Justice Brown,

text:
    Palmer’s Estate.

      Wills — Testamentary capacity — Probate—Evidence.
    Testamentary capacity is the normal condition of one of full age, and the affirmative is with him who undertakes to call it in question, and this affirmative he must establish, not in a doubtful, but in a positive manner.
    On an application to admit a will to probate, the case turned upon the evidence of the two subscribing witnesses and the attending physician. One of the subscribing witnesses, a justice of the peace, was the scrivener of the will. He testified that the testator dictated it and that he wrote it just as dictated; that in the writing ho made a mistake which the testator corrected; that after it was all written he read it over to the testator who said it was correct. Ho also testified that the testator was rational, and that when he placed the will in his pocket the testator said it was all right. The other subscribing witness testified that the testator signed his name without any assistance, that he seemed to be in a stupid condition, but that she could not tell whether he knew what he was doing. The attending physician testified that the testator was not in fit condition to make a will on the day the paper was executed; but he testified that two days before he himself had filled up two judgment notes for the decedent, and witnessed his execution of them, and at this time the testator was conscious of what he was doing in business matters. The witness also testified that he told the scrivener on the day of the execution of the will that testator’s mind was clear at times when he was aroused, but that his mind was torpid when he was left alone; that “occasionally he would be clear; he seemed to be clear while you were speaking. . . . When you would speak to him he would speak up rational.” Held, that the evidence was not sufficient to justify the refusal to admit will to probate.
    Argued Oct. 22, 1907.
    Appeal, No. 175, Oct. T., 1907, by M. M. Palmer et al., from decree of O. C. Indiana Co., Sept. T., 1906, No. 78, refusing to admit a will to probate in Estate of Joseph Palmer, deceased.
    Before Mitchell, C. J., Fell, Brown, Mestrezat, Potter, Elkin and Stewart, JJ.
    Reversed.
    Appeal from decree affirming decree of register of wills refusing to admit to probate a paper purporting to be the will of Joseph Palmer, deceased.
    The facts are stated in the opinion of the Supreme Court.

      Error assigned was decree refusing to admit the will of the decedent to probate.

      John A. Scott and John P. Blair, with them Elder Peelor, for appellants.

      J. N. Banks and S. M. Jack, with them Samuel Cunningham, for appellees.
    January 6, 1908:
   Opinion by

Mr. Justice Brown,

This is an appeal from the decree of the orphans’ court of Indiana county, affirming the decree of the register of wills refusing to admit to probate a paper purporting to be the last will of Joseph Palmer, deceased. The register’s decree was based upon his finding from the testimony produced before him, that the testator did not possess testamentary capacity at the time he executed the will. On the hearing of the appeal undue influence was urged as an additional reason why the probate should be refused, but as to this the court said the evidence offered for the purpose of showing it was insufficient, and the decree was affirmed on the ground of testamentary incapacity alone.

A great mass of testimony was taken before the court on the hearing of the appeal, and, in addition thereto, by agreement of the parties, there was submitted for its consideration that of J. T. Iiurd and Dr. R. S. Keeler, taken before the register. The former, called by the proponents, was the scrivener who drew the will and one of the subscribing witnesses to its execution ; the latter, called by the contestants, had been the attending physician of the deceased. It clearly appears from the opinion of the judge of the orphans’ court that he sustained the register, not from a consideration of all the testimony produced before him, but from that of Hurd and Keeler, as to whom he says: “ Their evidence is contradictory, and their conclusions are diverse. They are the witnesses who had the best opportunity of knowing what the mental condition of the testator was at the time of the making of the will. In considering their testimony, we cannot but regard that of Dr. Keeler as the more convincing. He was the physician, and his judgment as to testator’s condition of mind, all else being equal, ought to be superior. He was in attendance upon him daily before and after the execution of the will. lie knew the nature of the disease and its effect upon the mind, the character of the medicines administered, and the effect they were intended to and did produce. The scrivener, on the other hand, saw him but once during his illness, and then only for the brief time he was writing the paper. Their opportunities to arrive at a correct opinion were altogether in favor of Dr. Keeler, and wve must give his testimony the greater weight. Eurther, Dr. McHenry testifies that he attended testator on several occasions between 1895 and 1905, when suffering from suppression of urine, and his testimony as to the effect which the diseases had upon the mind corroborates that of Dr. Keeler. There is before us other evidence bearing upon his condition of intelligence at or near the time of the writing. Whilst this evidence shows that there was for brief periods a knowledge of persons, or the remembrance of facts and circumstances in connection with his family and estate, yet, there is in our view, nothing to outweigh the conclusion we have arrived at from a consideration of Dr. Keeler’s testimony and other testimony strongly corroborative of it.” Dr. McHenry’s corroboration of Keeler was in the nature of an answer to a hypothetical question put to him by the contestants. He had not seen the decedent for nearly two years before his death. But whether McHenry corroborated Keeler, or there was other testimony strongly corroborating him, we do not regard as material, for, from our examination of his testimony before the register and the court, wTe find nothing in it to sustain the contention of the appellees that the testator lacked testamentary capacity. Evidence strongly corroborative of Hurd was offered, but we shall not refer to it, for this decree must be reversed on the testimony of’the two witnesses, who, as the court below very properly said, “ had the best opportunity of knowing what the mental condition of the testator was at the time of the making of the will.”

The testator died September 5,1906. He was eighty-five years of age. His will was executed August 29, 1906. On that day Hurd, a justice of the peace, in response to a message received the day before that the testator wished to- see him, went to his home. The following is taken from his testimony as to what occurred there: “ Q. What did you do when you .went in? A. 1 said: ‘Good morning; I want to see Mr. Palmer.’ He was upstairs in bed. I then went upstairs. I found Mr. Palmer in bed. Q. Did you make any inquiry of him ? A. I says, ‘ Good morning,’ and shook hands. ‘ How are you this morning ? ’ ‘Hot too bad.’ ‘ What do you want with me ? ’ He says, ‘ I sent for you to write ray will.’ Then there was promiscuous conversation. We talked about farming and different things for, I suppose, twenty minutes. Q. Was the’wilbwritten then? A. Ho, sir. Q. At that time did you discuss the subject-matter of the will? A. Ho, sir; not in that conversation. He just said, ‘ I want you to write my will.’ Then we dropped that subject and we talked about other things. Q. Did you remain in the room or leave it after this general talk ? A. I stayed in there, I suppose, twenty minutes, a little more or less, maybe;' then in came a big man with a satchel I never saw before, and Mrs. Palmer. He got to examining the old man and I got up and went downstairs. Q. Whom did you leave upstairs ? A. Mrs. Palmer and this man.I took to be' a doctor. -He proved to be Dr. Keeler of Marion Center. Q. Then Mrs. Palmer and Dr. Keeler were the only persons in the room besides yourself? A. Yes, sir; and Joseph Palmer. Q. What did you do after you went downstairs ? A. I went outside of the fence and stood there by myself. Q. State whether or not you had any conversation with anyone there after you were at the fence, or did anyone come to you there? A. I stayed there until Dr. Keeler came downstairs and he came out there. I didn’t know his name, but I says, ‘What condition is the old man Palmer’s mind this morning ? ’ He says, ‘ All right.’ He says, ‘ What is your business ? ’ I says, ‘ I play justice of the peace over here in Canoe township and came over to write the old man’s will.’ He says, ‘ He is all right, you go up and write it.’ lie says, ‘I tried it yesterday, but didn’t get it done; I got a couple of notes.’ He says, £ He is all right.’ ... I' got my paper ready and .1 said: ‘ Now I will commence,’ and we commenced and it is down verbatim, word for word as he said it. Q. In the provision of the will he provides for certain persons; state whether or not he named the persons to you? A. Yes, sir. . . . Q. State whether or not there was anything said by the old gentleman about the little boy’s name ? A. Yes, sir. I wrote it down wrong and when I read it over, it was wrong. I didn’t understand him when he gave it to me. This boy’s name is Don Atley Palmer. Q. What did he say about correcting it ? A. I made a mistake. When I read it over to him I read the name as I had written it and he said ‘ That isn’t right.’ I said £ What is it? ’ He told me and I said £ I will rectify it.’ I did, and then read it over. When I read it over it was all right. Q. When you read it over did he assent to it as being correct? A. Yes, sir. . . . Q. Did you write down in the will the disposition of the $2,100 as he dictated ? A. He dictated every word that is in there and I put it down. Q. Do you recollect his naming any of his children at that time? A. Yes, sir. Q. Which ones? A. Charlie Palmer. Q. What did he say about that ? A. lie said £ Put down $50.00 for Charlie Palmer.’ He said £ Put down surface of the farm in Blacklick township to Foster Palmer during his lifetime and at his death, share' and share alike to his children.’ Q. Did he say anything further about Charlie Palmer ? A. He said, ‘lie was a very ungrateful son.’ . . . Q. State whether he was rational at that time? A. If my judgment is any good I would say he was all right. Q. State whether he was rational when you discussed the general subjects with him before that? A. Yes, sir. Q. After the will was written, state whether or not you read it to him? A. Certainly. Q. What did you then do ? A. Put it in my pocket. . : . Q: What did you do with that will after it was signed by Mr. Palmer and witnessed ? A. I says,£ What will I do with this?’ I says, £ I will take it home and keep it until it is called for.’ He said ‘All right:’ Q. What did he say about keeping The will ? A. He said £ All right.’ I said £ I will take it and keep it until it is called for.’ He said ‘ All right.’ Before I went downstairs Joseph Palmer said to me: ‘You ought to have your pay for this work.’ I says, ‘You can pay that some day again.’ I said, ‘ Never mind, I can get that some day again’. ... He knew what he was doing. . . . Q. He was very clear in his mind and understood perfectly well ? A. He was clear enough; you couldn’t have cheated him the day I was there. Q. He talked pretty freely to you? A. Yes, sir; and he talked sensibly.” Bessie Palmer, the other subscribing witness to the will, testified that the testator signed his name to it without any assistance, that he seemed to be in a stupid condition, but that she couldn’t tell whether he knew what he was doing. The appellants proposed to ask her, on the hearing before the court, whether she had not testified before the register that the testator’s mind was clear, but this was not permitted.

It is clear from Hurd’s testimony, from which we have quoted at length, that the testator possessed testamentary capacity, and, turning to Keeler’s, what is to be found in it justifying the conclusion of the court that he did not possess it?. Called as the attending physician of the deceased, Keeler stated in certain portions of his testimony that, as a result of the medicine given to relieve pain, Palmer was- in a torpid condition, that his mind was stupid and inactive and he was not in a fit condition to make a will on August 29, 1906; but, taking the testimony of this witness as a whole, it not only falls short of proving testamentary incapacity, but in a measure corroborates Hurd. Though in one part of it he expressed the opinion that the decedent was not fit to make a will, in another he says: “I don’t know.” Two days before it was executed he himself had filled up two judgment notes for the decedent and witnessed his execution of them. When asked whether he was conscious of what he was doing in business matters, his reply was: “ At the time he made the notes, I think he was; at the will, I don’t know.” In the face of this, little importance is to be attached to his statement that he did not consider the deceased in a “ fit condition ” to make a will, and none in view of what is gathered from other portions of his testimony. From his examination in chief before the register we extract the following: “Q. State whether or not you observed his conduct and expressions ? A. Yes, sir. Q. State what expressions, if any, you saw out of the ordinary, or heard ? A. I can’t remember his expressions he made or anything he said. I know that the mind is always in a torpid condition. Q. What about his expressions to indicate he did not understand? A. He did not answer readily, and was slow about telling you how he felt.” When asked, in the same examination, about the condition of the testator on the morning Ilurd wrote the will, his testimony was as follows: “ Q. What was the condition of Mr. Palmer that morning ? A. When you spoke, he was clear about what you spoke.” In his cross-examination he testified as follows: “ Q. You say his answers would be clear when roused ? A. To a certain extent.” As to what took place between Ilurd and himself, he testified as follows : “ Q. You said before that Mr. Hurd came downstairs and you walked out together to your buggy ? A. Ho followed me. Q. He there questioned you ; told you he was there for the purpose of writing a will, and asked you in regard to Mr. Palmer’s condition ? A. He told me before he asked me what I thought of his mind. I told him he was clear by times when he roused him, but his mind was torpid when you left him alone. Q. When his mind was summed up, his answer would be clear ? A. lie could’nt have anything connected for any length of time. Occasionally he would be clear. He seemed to be clear while you were speaking.” In his cross-examination before the court, when asked about the notes he had filled up for Palmer, he said: “He knew a certain amount of what he was doing. When you would speak to him he would speak up rational.” And as to what took place between Hurd and himself, he again testified as follows: “ Q. Mr. Ilurd went there and had a conversation with you ? A. He followed me out there. Q. Did he make inquiry out there of you about the condition of Air. Palmer? A. He asked mo what condition I found him in this morning. Q. And you told him that his mind seemed clear when you would speak to him; as clear as it would ever be? -A. Yes, sir; those are about the words I said.”

It is needless to dwell on the insufficiency of Heeler’s testimony as a basis for the decree of the court below. Even if the conclusion was reached from it that the mind of the testator was stupid and inactive, and his thoughts seemed to come to him slowly and uncertainly, it was forgotten not only that such conditions are not inconsistent with testamentary capacity, but that from Keeler’s own admissions the testator seemed to possess it. Those admissions were that he did not know whether Palmer was fit to make a will; that he seemed to be clear while one was speaking to him ; that when spoken to he would speak rationally, and, on the morning the will was executed, this witness stated to Hurd that Palmer’s mind seemed clear when he was spoken to. “ The law presumes everyone Of full age competent to make a will, of sufficient mental capacity to do the act; therefore, he who alleges to the contrary must prove it to the satisfaction of the jury:” Landis v. Landis, 1 Grant, 248. “ Testamentary capacity is the normal condition of one of full age, and the affirmative is with him .who undertakes to call it in question, and this affirmative he must establish, not in a doubtful, but in a positive manner:” Grubbs v. McDonald, 91 Pa. 236.

The decree .is reversed and the record remitted, with direction that the , register of wills of Indiana county admit to probate the paper executed by Joseph Palmer, August 29,1906, as his last will and testament, the costs below and on this appeal to be paid by the appellees.


author: Mr. Justice Stewart,

text:
    Cunningham v. First National Bank of Indiana, Appellant.

      Banks and banking — Checks—Forgery—Notice.
    Where a check is. paid on a forged indorsement and the drawer of the check after discovering the forgery delays for six weeks in notifying the bank thereof, the drawer' cannot recover from the bank the amount of the loss, if it appears that the bank in which the cheek was first deposited had failed in the meantime, and that if the bank upon which the check was drawn had had timely notice, it could have saved the loss by recourse to funds of the other bank.
    Argued Oct. 22, 1907.
    Appeal, No. 177, Oct. T., 1907, by defendant, from judgment of C. P. Indiana Co., Sept. T., 1906, No. 323, on verdict for plaintiff in case of R. H. Cunningham v. First National Bank of Indiana.
    Before Mitchell, C. J., Fell, Brown, Mestrezat, Potter, Elkin and Stewart, JJ.
    Reversed.
    Assumpsit by a depositor against a bank to recover money paid on a forged indorsement of a check.
    Before Telford, P. J.
    The opinion of the Supreme Court states the case.
    When J. D. Ayers was on the stand he was asked this question : “ Q. I)o you know the present condition of the Delmont National Bank, whether it is solvent Or insolvent ? ”
    Mr. Emery : Objected to.
    The Court: Objection sustained.

      “ Q. Do you know how much of a dividend the Delmont National Bank is paying ? ”
    Mr. Emery : Objected to.
    The Court: Objection is sustained and an exception is granted to the defendant. [5]
    The court charged in part as follows :
    [It would seem that the date of notice of the forgery to the holder is not material, unless by delay the position of the party receiving the money has been altered for the worse in the meantime. It would appear that after the plaintiff received knowledge of the forgery according to his testimony he gave the defendant prompt notice. ... It appears from the evidence that the plaintiff, Cunningham, notified the bank promptly upon learning the fact of the forgery. If the jury believe that he did so, then he did all that is required of him unless you shall find also that under the circumstances of this case, as they appear to you from the evidence, he should have, or could have, by ordinary care and diligence, discovered the forgery at an earlier date, and that by his failure to exercise such care and diligence the defendant was deprived of advantage which might have accrued to it from an earlier knowledge of the alleged forgery.] [6]
    Yerdict and judgment for plaintiff for $2,100. Defendant appealed.

      Errors assigned were (5) rulings on evidence, quoting the bill of exceptions; (6) above instructions, quoting them.

      John P. Blair and James S. Campbell, for appellant.
    — A bank with which a check is deposited by a third party to the credit of another bank and so placed, can, when apprised of the forgery of an indorsement already on the check when so deposited, charge that check back against said bank’s account and deduct the amount of it therefrom, even though said check has not been indorsed by the bank to whose credit it has been deposited, provided it has received a credit for said check: Rapp v. National Security Bank, 136 Pa. 426; American Trust & Saving Bank v. Gruder, etc., Mfg. Co., 150 Ill. 336 (37 N. E. Repr. 227).

      A general custom followed by the banks in Pittsburg and vicinity to mark with a stamp a check presented by an agent of another bank for the latter’s credit, and to regard that as an indorsement, is admissible: Shaffstall v. McDaniel, 152 Pa. 598; Adams v. Ins. Co., 95 Pa. 348; Carter v. Phila. Coal Co., 77 Pa. 286.
    It is perfectly proper and legal for banks to agree that for convenience in the collection of commercial paper, the bank with which a check is deposited for the benefit of another bank may stamp it as deposited for that bank’s credit, and such action will constitute the latter an indorser as to the former: Blanchard v. Hilliard, 11 Mass. 85; Warren Bank v. Suffolk Bank, 64 Mass. 582.
    The delay of a month and a half of plaintiff in notifying defendant of the forgery prevents a recovery, for in that time the funds of the Delmont National Bank in the hands of the Bank of Pittsburg were removed, and the Delmont National Bank is now' insolvent’; thus defendant was deprived of a remedy.
    In view of the evidence the court erred in virtually taking the question of negligence of the plaintiff, in not giving notice, from the jury by instructing them twice, distinctly, that plaintiff had notified the bank promptly upon his discovery of the forgery.
    Where one of two parties who are equally innocent of actual fraud must lose the one whose misplaced confidence in an agent or attorney has been the cause of the loss, shall not throw it on the other: Penna. R. R. Co.’s App., 86 Pa. 80.

      John A. Emery, with him J. N. Banks, for appellee.
    January 6, 1908:
   Opinion by

Mr. Justice Stewart,

The Bank of Pittsburg accepted a check for $2,TOO drawn by the plaintiff on the First National Bank of Indiana, the defendant, payable to the order of C. M. Johnston, and bearing what purported to be an indorsement by the payee and a subsequent indorsement by one McQuaide. The Bank of Pittsburg, having an open account on its books with the Delmont National Bank, presumably at the direction of the last indorser, credited the latter bank with the amount of the check, and, having indorsed it with an express guarantee of the genuineness of the prior indorsements, forwarded it to the Bank of Indiana, where it was charged up against the deposit account of the drawer. The check had never been in the hands of the payee ; it had been left by the drawer in the hands of his attorney to be delivered over to the payee for or upon the satisfaction of a certain mortgage. Instead of being so applied the check, with a forged indorsement of the payee’s name, was presented to the Bank of Pittsburg, and was by it accepted and credited to the account of the Delmont National Bank, of which McQuaide, the plaintiff’s attorney, was president. A year later, May 1, 1906, Johnston, the payee, told the plaintiff that ho had not indorsed the check. To assure himself that he had drawn the check payable to the order of Johnston and not to the order of his attorney, plaintiff the same day procured the check, and upon examination found that it was payable to Johnston’s order, and that it bore an indorsement purporting to be Johnston’s. Six weeks thereafter he exhibited the check to Johnston, who positively repudiated the indorsement. The same day the plaintiff notified the Indiana bank of the forgery, and made demand for reimbursement. This brief statement of the facts is sufficient for an understanding of the only assignments of error in the case which it is necessary to consider.

In view of plaintiff’s admission that he was informed by Johnston as early as May 1,1906, that he had not indorsed the check which plaintiff then knew was drawn payable to Johnston’s order, and that he had not notified the defendant bank of such denial for six weeks thereafter, defendant offered evidence to show, first, that the Delmont Bank is insolvent; second, that between May 1, 1906, when plaintiff was notified by Johnston that he had not indorsed the check, and June 15, following, when plaintiff notified the Indiana Bank of the forgery, the Bank of Pittsburg had in its hands funds of the Delmont National Bank sufficient to reimburse it on account of its acceptance of the forged check. The purpose of the offer was to afford ground for. the contention that the Bank of Pittsburg, which, because of its guarantee of the genuineness of the indorsements, was liable over to the defendant bank, had been prejudiced by negligence of the plaintiff in failing to promptly notify the defendant bank of the forgery ; this on the theory that the defendant bank, in order to hold the Pittsburg bank, was bound to interpose to plaintiff’s demand against it whatever equities the former had. The offer was rejected because, as stated in the opinion filed refusing a new trial, the effect of it would be to make the Delmont Bank an indorser of the check,' whereas in fact its name does not appear in connection with the check and it was a stranger to the transaction. But the liability of the Delmont Bank on the check was not a question in the case; whatever liability it was under to the Bank of Pittsburg was for money which had been paid or credited to it by mistake, and to which it had no claim. That-the. Pittsburg Bank would have the right to charge back on its books the credit given the Delmont Bank on this forged indorsement, cannot be questioned. .The latter had received á credit to which it was not entitled, for which it had given nothing, and the withholding of it by correction on the books of the Pittsburg Bank could not in any way have prejudiced the Delmont Bank. The latter was never in position to demand the credit; the Pittsburg Bank, on discovery of the forgery, could successfully have resisted any attempt to enforce such credit. With the evidence in, the question would have been for the jury to decide tinder proper instructions, whether facts necessary to establish negligence on the part of the plaintiff to the prejudice and loss of the Pittsburg Bank had been made out. Since the evidence should have been admitted, the fifth and sixth assignments of error must be sustained.

Judgment reversed, and venire facias de novo awarded.


author: Mr. Justice Mestrezat,

text:
    Smith v. E. D. Carter et al., Appellants.

      Equity — Equity practice — Resident and nonresident defendants — Service —Act of April 6, 1859, P. L. 387.
    Where a bill in equity is filed against seyeral defendants, one a resident and the others nonresidents, and the service is had upon the resident defendant, the nonresident defendants may be served in the manner prescribed by the Act of April 6, 1859, P. L. 387, if the averments of the bill show on their face that the resident defendant is a principal defendant.
    Where a bill in equity for an accounting against several defendants shows transactions among all the parties so connected and so complicated as to render it necessary to bring all the parties before the court in order to enforce the plaintiff’s rights, one of the defendants who is a resident, will be deemed a principal defendant in support of a service on nonresident defendants under the Act of April 6, 1859, P. L. 387.

      Equity — Equity practice — Decree pro confesso — Jurisdiction—Motion to strike off service.

    Where a bill in equity is filed against several defendants, with the usual notice to appear and answer, and certain of the defendants move the court to strike off the service upon them, and proceedings remain in abeyance pending the motion, such defendants, after the court has overruled their motion, are bound to answer, and if they fail to do so they cannot allege as an excuse that they wore not served with a second notice requiring them to answer. In such a case a decree pro confesso is properly entered against them. If subsequently they enter a general appearance, and a hearing is had against them ex parte, and a decree is entered against them, they have no standing to move the court to strike off the judgment pro confesso or to raise a question as to the court’s jurisdiction.
    Argued Oct. 22, 1907.
    Appeal, No. 178, Oct. T., 1907, by E. D. Carter et al., from decree of C. P. Indiana Co., Sept. T., 1905, No. 5, on bill in equity in case of D. M. Smith and E. B. McGara v. John McGaughey, J. C. King, W. H. Stamey, E. D. Carter, Louis Streuber, B. E. Cartwright and B. E. Cartwright, Executor of L. P. Snyder, deceased, Defendants, E. D. Carter, Louis Streuber, B. E. Cartwright and B. E. Cartwright, Executor of L. P. Snyder, deceased, Appellants.
    Before Mitchell, C. J., Fell, Brown, Mestrezat, Potter, Elkin and Stewart, JJ.
    Affirmed.

      Bill in equity for an account.
    Before Telford, P. J.
    The opinion of the Supreme Court states the case.

      Errors assigned among others were (1) refusal of motion to set aside service; (2) entry of decree pro confesso; (3) refusal to strike off decree pro confesso; (4) in entering a decree against the appellants on an issue joined between plaintiffs and W. H. Stamey, J. C. King and John McGaughey.

      Fred H. Ely, with him J. Wood Clark, for appellants.
    — John McGaughey was not a principal defendant: Elk Brewing Co. v. Neubert, 213 Pa. 171; Artman v. Giles, 155 Pa. 409; Coleman’s App., 75 Pa. 441; Wallace v. United Electric Co., 211 Pa. 473.
    Plaintiffs cannot enter a decree pro confesso after the motion to set aside service of the bill had delayed the filing of their answer for more than thirty days after the service of the bill, without first giving them notice to or entering a rule on them to plead, answer or demur.

      J. N. Banks and Harry White, for appellees.
    January 6, 1908:
   Opinion by

Mr. Justice Mestrezat,

The learned judge of the court below has correctly disposed of the questions raised bn this record and we agree with his conclusions.

The service was made on the appellants by virtue of the Act of April 6, 1859, P. L. 387, 2 Purd. (13th ed.) 1422. The lands and tenements named in the bill and out of which the suit grew are within the jurisdiction of the court below. The bill was served upon John McGaughey, a citizen and resident of Indiana county, and claimed by the plaintiffs to be a principal defendant. After service had been made upon McGaughey the plaintiffs presented their petition to the court averring that the bill had been served on McGaughey, “ one of the principal defendants therein, who resides in the county of Indiana,” and prayed that an order be'made directing service of the bill with notice to appear and answer on the appellants who did not reside within the jurisdiction of the court. The order was made as prayed for and service was made in pursuance thereof on each one of the appellants. Counsel for appellants appeared specially for the purpose of moving the court to set aside the service upon their clients and entered a motion that the service be set aside, assigning as reasons therefor that under the allegations of the bill the court had no jurisdiction over nonresident defendants and had no authority to order the bill served on such defendants, and that John McGaughey was not a principal defendant. It was conceded in the court below that if McGaughey was a principal defendant that the court had authority to order the bill served upon the appellants. The learned judge below held McGaughey to be a principal defendant, observing in his opinion that “ whatever may be disclosed upon a full hearing of this case, an inspection of the allegations of the bill leads us to the conclusion that John McGaughey is a principal, an active and not a passive defendant.” The court was entirely right in its conclusion. The bill averred, inter alia, “That your orators have not been able to ascertain and cannot tell which of the defendants, or how many of them, have the moneys coming to your orators, or the difference between $25.00 and $42.50 per acre yet owing and unpaid on said 1,075 acres and seventy-four perches of coal and mining rights and privileges owned by your orators, but that the same are in the hands of said defendants, or some of them, and should be accounted for and paid over to your orators and to the parties entitled thereto.” It was a question, under the facts averred in the bill, who should account for the moneys alleged to be due the plaintiffs and, as suggested in the opinion of the learned trial judge, it was a question whether McGaughey, King and Stamey were not liable to the plaintiffs for the entire purchase money of the property in question. These defendants, however, filed answers denying their liability to account to the plaintiffs for any part of the money. The transactions between all of the defendants growing out of the sale of the coal options were so connected and so complicated that it became necessary to bring all the parties before the court in order to enforce the rights of the plaintiffs to an accounting. This made McGaughey a principal defendant and conferred jurisdiction on the court to make the order of service under the act of 1859.

The bill was served on the appellants in September, 1905. The order of the court refusing to strike off the service was filed January 10, 1906. Answers were filed by McGaughey, King and Stamey on April 2, 1906, and issue was joined as to them on April 12, 1906. Judgment pro confesso was entered against the" appellants on April 16, 1906. The same counsel again appeared for the appellants on February 23, 1906, and on May 23, 1906, moved the court to strike off the judgment pro confesso. This motion was denied July 7, 1906, and this constitutes the second assignment of error.

The cause was on the regular equity list in the court below, and on May 9,1906 was called and heard as to the defendants who had appeared and filed their answers and ex parte as to the appellants against whom the decree pro confesso was entered on April 16, 1906. The condition of the record, therefore, at the time the motion to strike off the judgment pro confesso was made showed that the bill with the notice required by the equity rules to appear and plead had been served on the appellants in-September, 1905 ; that their motion to set aside the service of the writ had been denied on January 10, 1906; that counsel for appellants had entered a general appearance on February 23,1906 ; and that the trial court had heard the cause as to all the parties defendant, including the appellants, on May 9, 1906. The notice required by the equity rules which was printed on the bill and served with it on the appellant’s required them to enter'án appearance within fifteen days and to file an answer within thirty days after the service, and in default thereof the bill was liable to be taken pro confesso. On this record it is clear that the plaintiffs were fully justified in entering the decree pro confesso against the appellants. After the order refusing to strike off the service had been made by the court, they had over three months in which to demur, answer or plead to the bill before the default was entered against them. No further notice to answer was required to be given to them than the one printed upon the bill and served upon them in September, 1905. There is no precedent under oúr equity rules, for requiring the plaintiff to serve a defendant with a notice to appear and answer other than that to be indorsed upon and served with the bill' filed in the case. There is no reason, so far as we can see, why a defendant; under the circumstances of this case, should have the right to demand of the plaintiff another formal notice of the filing of the bill and to appear and plead to it before a decree pro confesso can be entered against him. The proceedings were allowed to remain in abeyance while the motion to set aside the service was pending. After the motion was disposed of, of which the appellants had duo notice, it was their duty to demur or answer and their failure to do so entitled the plaintiffs to a judgment pro confesso under the equity rules.

The conduct of the appellants, as shown b}^ the record, did not warrant the court in scrutinizing too closely its jurisdiction. They had ample opportunity to be heard, both as to the question of jurisdiction and on the merits of the case. Instead of taking advantage of the opportunity thus afforded them, they have sought in every step they have taken in the cause simply to prevent a hearing on the merits. After the court had refused to strike off the service, and they found themselves within its jurisdiction, they then had the opportunity to raise the question whether equity would take cognizance of the case presented by the bill. This was the proper course for the appellants to pursue if they wished to raise the question of jurisdiction: Adams’s Appeal, 113 Pa. 449. After the several steps taken in the court below to dispose of the case on its merits, as shown by the record, the appellants are too late in raising the question of jurisdiction: Adams’s Appeal, 113 Pa. 449; Fidelity Title & Trust Co. v. Weitzel, 152 Pa. 498; Drake v. Lacoe, 157 Pa. 17.

The findings of fact by the learned trial judge are supported by the evidence. While the court might have made a decree as to the issue raised by the defendants who appeared, the appellants are not in a position to allege irregularities because such decree was not entered. The decree entered against the appellants is not affected by the failure to make a decree against the other defendants. The money ordered to be paid by the appellants to the plaintiffs does not, under the evidence, belong to the other defendants, and they have no claim upon it The contest over the fund is between the appellants and the plaintiffs, and any decree that the court might have entered against the other defendants could not in any way have affected the disposition of it. ,

The assignments of error are overruled and the decree of the court below is affirmed.


text:
    Nelson v. Beaver County, Appellant.

      Public officers — County solicitors — Compensation for services — Act of May 22, 1895, P. L. 101.
    Where an attorney at law is appointed county solicitor by the county commissioners, and his salary is fixed at a definite sum per annum, he cannot claim extra compensation for services rendered to the county in connection with litigation growing out of proceedings to condemn toll bridges; and this is the case although he had an agreement with the commissioners that his salary should only be for services as general counsel, and should not include payment for suits, litigation and special collections.
    Under the Act of May 22, 1895, P. L. 101, county commissioners are authorized to appoint a solicitor and determine the amount of his salary, and the appointee can simply accept or decline the appointment. There can be no conditional acceptance nor a contract between the commissioners and appointee which can legally authorize the payment to him of any sum additional to his salary for the performance of the services specified in the statute.
    Argued Oct. 22, 1907.
    Appeal, No. 106, Oct. T., 1907, by defendant, from judgment of C. P. Lawrence Co., Dec. T., 1906, No. 31, on verdict for plaintiff in case of D. A. Nelson v. Beaver County.
    Before Mitchell, C. J., Fell, Blown, Mestrezat, Potter, Elkin and Stewart, JJ.
    Reversed.
    Assumpsit to recover, for professional services.
    Before Porter, P. J.
    The facts are stated in the opinion of the Supreme Court.
    Yerdict and judgment for plaintiff for $3,000. Defendant appealed.

      Error assigned was (22) in refusing binding instructions for defendant.

      Henry H. Wilson, and Robert K. Aiken, for appellant.
    An act mandatory in form and peremptory in substance would be peremptory if permissive in form. See Schaeffer v. Jack, 14 S. & R. 426; People ex rel. v. Supervisors, 51 N. Y. 401; People ex rel. v. Commissioners, 6 L. R. A. 161 and note.

      There can be no contract, either express or implied, for extra compensation. Such a contract is ultra vires and in no way binding upon the county: Lancaster County v. Fulton, 128 Pa. 48; Chester County v. Barber, 97 Pa. 455; Rothrock v. Easton School Dist., 133 Pa. 487; Kilpatrick v. Bridge Co., 49 Pa. 118; Russell v. Luzerne County, 3 Pa. Dist. Rep. 493; Koontz v. Franklin County, 76 Pa. 154; Com. v. Bacon, 6 S. & R. 322.

      J. Norman Martin, with him Agnew Hice, for appellee.
    The contract of employment was in writing, is unequivocal and precise, not fixing the rate or amount of compensation for litigation, because at the time of making the contract the parties could not know in what litigation the county might be involved, and bound the county to accept and the plaintiff to render the services in question; this contract preceded the rendition of the services for which the compensation is claimed: Bechtel v. Fry, 217 Pa. 591.
    Plaintiff was not a county officer and his employment is not governed by rules applicable to county officers: Com. v. Collier, 213 Pa. 138; Chester County v. Barber, 97 Pa. 455; Lancaster County v. Fulton, 128 Pa. 48.
    The contract between the parties may be determined by what the parties did with reference to the employment: Brunner v. American T. & T. Co., 151 Pa. 447; Fulton v. Lancaster County, 162 Pa. 294.
    January 6, 1908:
   Opinion by

Mr. Justice Mestrezat,

This is an action brought by D. A. Nelson, Esq., an attorney at law, to recover for professional services which he rendered the county of Beaver. These services were rendered between April 1, 1901, and November 9, 1905, in connection with litigation growing out of proceedings in Beaver county to condemn certain toll bridges in the county.

From the evidence in the case, it appears that the county commissioners of Beaver county met on the first Monday, being January 5, 1903, organized as a board for that year, and passed the following resolution : “ The name of D. A. Nelson being presented for attorney for the commissioners, and there being no other applicant, he having two votos, a majority of the board, was duly elected.” This resolution was entered on the minutes of the board of county commissioners. On the day following the adoption of this resolution, Mr. Nelson signed and filed with the commissioners the following paper:'

“Whereas, I, D. A. Nelson, having been appointed by the board of commissioners of Beaver county, solicitor for said county, for the term of three years, at a salary of $600 per annum for general counsel, this salary not to include payment for suits, litigation and special collections, such services to be recompensed when rendered by the solicitor. Therefore, in consideration of the above conditions and considerations, I accept said appointment and agree to perform all duties required of me by said board, and shall pay all fees and commissions received as county solicitor as the property of the said county into the county treasury duriug the continuance of my appointment, first deducting fees which properly belong to me by virtue of my office as attorney or as county solicitor.” Mr. Nelson says' that this is the only contract or agreement between him and the county commissioners with reference to his services, and that all his services were rendered under this contract.

The plaintiff testified that oh the afternoon of January ■ 5, 1903, the day he was appointed county solicitor, that he had a talk with the board about his compensation and they spoke of $600. He says he told them he would not accept the office at that compensation ; that thereupon they finally agreed that they would give him $600 for general counsel and that whatever litigation, or any litigation during the term, he should be paid extra for at a reasonable compensation and also for special collections. He admits that he received $1,800 for his professional services for the three years, from January 1, 1903, to January 1, 1906, when his term expired. It also appears that he received $300 for some litigation arising out of condemnation proceedings of a railroad over the poor farm of the county.

The claim of the plaintiff in this action is for services rendered the county during the time he' was county solicitor, as stated above, in certain litigation growing out of proceedings to condem certain toll bridges in Beaver county, and is in addition to the $600 annual salary which he received from the county during his three years term as county solicitor. The learned court below submitted to the jury to find whether the plaintiff performed the services under the alleged contract contained in his written communication to the commissioners, with instructions that if he did so they should find in his favor such an amount as compensation for his services as the evidence showed he was entitled to recover. There was a verdict for the plaintiff, and this appeal is taken by the defendant county from the judgment entered thereon.

The defendant resisted the plaintiff’s right to recover on the ground that he had been appointed by the commissioners of the county a county solicitor under the Act of May 22, 1895, P. L. 101, and that the only compensation he was entitled to by reason of the services rendered by him to the county was his salary, which it was the duty of the county commissioners to fix and which they did fix at the sum of f 600 per annum. The contention of the plaintiff is, and it was - sustained in the court below, that the services for which he claims in this action were rendered in pursuance of his letter of January. 6, 1903, which constituted a contract between him and the commissioners and were not rendered by him as county solicitor appointed under the act of 1895; that the $600 per annum which he received from the county was for his services as general counsel, and did not include his services in the litigation for which he claims in this suit or his services in any other litigation in which the county was involved during the three years which he acted as county solicitor..

In 1895, the legislature of this state, by an act approved May 22, authorized the county commissioners of the several counties of this commonwealth to appoint a county solicitor for a term of three years at a salary to be determined by them. The first section provides that the board of commissioners shall have authority to appoint a county solicitor. The second section provides as follows: “ That the solicitor so appointed shall hold his office for the term of three years and shall receive such salary as the Commissioners shall determine: Provided, that he shall, before entering upon the duties of his office, file with the county commissioners an agreement to pay all fees, attorney’s fees and commissions received from every source, as county solicitor, into the county treasury.” The third section, fixes his duties as follows: “ He shall commence and prosecute all' and every suit and suits brought or to be brought by the county, wherein or whereby any of the rights, privileges, properties, claims or demands of the county are involved, as well as defend all actions or suits brought against the county and shall perform all duties now enjoined by law upon County Solicitors and shall do all and every professional act, incident to the office, which may be required of him by the officers named in said Board.”

We-think it apparent from the third section of the act of 1895 that if the plaintiff was employed by the commissioners as county solicitor that the services he performed and for which he claims in this suit were clearly included within his duties as county solicitor. It will be observed that, by this section, he is to commence and prosecute all suits brought for the county and defend all suits brought against the county, and “do all and every professional act, incident to the office, which may be required of him.” This language certainly is broad enough to comprehend all the services the plaintiff rendered the county in the litigation growing out of the condemnation of the toll bridges. The important and controlling question, therefore, in the case is whether, under the facts disclosed by the evidence in the case, the plaintiff was appointed by the commissioners as a county solicitor under the act of 1895. If he was appointed and accepted the position as solicitor at a fixed salary, it is clear that he has no right to recover any compensation other than that he has already received as an annual salary from the county for his services.

The official action of the commissioners relative to the appointment of the plaintiff as solicitor of the county is shown by the resolution adopted on the day they organized as a board. By that resolution Mr. Nelson “ was duly elected ” as “ attorney for the commissioners.” In his letter to the commissioners of the day following, he recites that he was “ appointed by the board of commissioners of Beaver county solicitor for said county for the term of three years, at a salary of $600 per annum.” In the same communication he accepts the appointment, and, as required by the act of 1895, agrees to perform all duties required of him by the board, and to pay all fees and commissions received by him into the county treasury during the continuance of his appointment. Mr. Hineman, one of the county commissioners, testifies that Mr. Nelson “ was our counsel looking after the business of the county except litigation ; ” that “ he was county solicitor.” Mr. Carey, also a county commissioner, testifies that Mr. Nelson was elected county solicitor on the morning of January 5, 1903, and that he went out of office on the first Monday of January, 1906. The court in the charge, recognizing Mr. Nelson’s appointment of county solicitor as an undisputed fact, said that “ it was deemed advisable to employ a county solicitor, and on January 5 the board adopted a resolution electing the plaintiff to fill this position.” It is clear, therefore, and is not open to doubt, that Mr. Nelson was elected county solicitor for a term of three years by the commissioners of Beaver county on the day they met and organized as a board, and that he served as solicitor for the county during the three years for which he was elected.

We think it also conclusively appears that a salary of $600 per annum was fixed by the commissioners and accepted by Mr. Nelson. It is true that the resolution appointing Mr. Nelson a county solicitor does not fix his salary. His own testimony, however, and his written acceptance on the day following his appointment, show that he was appointed “ at a salary of $600 per annum.” Commissioner Hineman testifies that when Mr. Nelson was elected “ we fixed his salary at $600; ” and Commissioner Carey also testifies that “we employed him and fixed his compensation at $600 for attorney,” and that he was paid a salary of $600 per year. It is apparent, therefore, from the undisputed testimony in the case, that Mr. Nelson’s salary as solicitor was fixed by the board at $600 per annum, and that he received that salary from the county of Beaver during his three years term.

But it is contended by the plaintiff that his services as solicitor for which he received $600 per annum were rendered in pursuance of a contract, by the terms of which the salary was fixed and received as compensation only as “ general counsel,” and did “ not include payment for suits, litigation and special collections,” and that such services were to be recompensed when rendered by the solicitor. In other words, the plaintiff’s contention is that his services were rendered in pursuance of a contract between him and the county commissioners, evidenced by his letter of acceptance and not by virtue of his appointment by the commissioners as county solicitor. It is therefore claimed that the receipt by the plaintiff of his annual salary does not prevent him recovering the value of his services rendered the county in the condemnation of the toll bridges, and for which he has brought this action.

The contention of the plaintiff we regard as wholly untenable. As we have seen, he was appointed solicitor of Beaver county for a term of three years at a fixed salary. This was an exercise of the authority conferred on the county commissioners by the act of 1895, and was not a contract between the plaintiff and the board. The commissioners as well as the plaintiff were bound by the provisions of the statute, and they could not annul and set aside the statute and enter into a contract appointing the plaintiff solicitor with fees or compensation additio'nal to a salary. The act specifically provides that all commissions and fees received by him from every source shall be paid into the county treasury. If a solicitor for Beaver county was deemed necessary by the commissioners, the statute authorized his appointment, fixed his term and prescribed explicitly his duties. It also commanded the commissioners to fix the salary of the solicitor. This was done by the board in this case. It'is claimed, however, that the salary was simply as compensation for the plaintiff as “general counsel” for the county, and did not include the other services rendered by him as attorney in the litigation growing out of the condemnation proceedings. But neither the commissioners nor the plaintiff nor both had the authority to determine what services he should render the county as its solicitor, and equally impotent were both parties as to their power, by contract or otherwise, to impose upon the county any liability for compensation for the plaintiff as solicitor other than the salary fixed by the board of commissioners. While the statute authorizes the commissioners to appoint the solicitor and fix his salary, it also specifically sets forth his duties and declares what services he shall render the county in his official capacity. It likewise provides, as observed above, that the solicitor shall pay into the county treasury all fees and commissions received by him. The commissioners were authorized to appoint a solicitor and determine the amount of his salary, and the appointee could simply accept or decline the appointment. There could he ho conditional acceptance, nor a contract between the commissioners and appointee which could legally authorize the payment to him of any sum additional to his salary for the performance of the services specified in the statute. In so far as the board and the plaintiff attempted to prescribe the duties to be performed by the latter under his appointment as solicitor their act was ultra vires, and did not bind the county. The plaintiff, as county solicitor, was required to perform the duties imposed upon him by the act of 1895, and these duties required him to perform the “ services in connection with the litigation growing out of the taking by the county of Beaver under the right of eminent domain,” of the toll bridges in the county. For his services as solicitor, ho received an annual salary which, by the express terms of the statute under which he was appointed, includes compensation for the services for which this action was brought.

The uncontroverted facts of this case rule it against the plaintiff and the learned trial judge should, as requested, have instructed the jury that the verdict must he for the defendant.

The twenty-second assignment of error is sustained, the judgment is reversed, and judgment is now entered for the defendant.