author: Pee Cueiam,

text:
    Commonwealth, Appellant, v. Real Estate Trust Company.

      Taxation—License tax—Real estate brokers—Trust company—Acts of May 27, 1841, P. L. 396, April 10, 1849, P. L. 570; May 15, 1850, P. L. 772, and May 2, 1899, P. L. 184.
    A trust company incorporated under the Act of April 29, 1874, P. L. 73, and the supplements thereto, including the Act of May 9, 1889, P. L. 159, and authorized, among other things, to transact the business of buying and selling real estate, is not liable to pay to the state a license tax as a real estate broker under the Acts of May 27, 1841, P. L. 396, April 10, 1849, P. L. 570, May 15, 1850, P. L. 772, and May 2, 1899, P. L. 184.
    The words “any individual or copartnership” as used in the Act of May 27,1841, P. L. 396, do not include corporations. The Acts of April 10, 1849, P. L. 570, and May 15, 1850, P. L. 772, did not extend the provisions of the Act of May 27, 1841, to corporations.
    Argued Jan. 19, 1905.
    Appeal, No. 327, Jan. T., 1904, by plaintiff, from judgment of Superior Ct., Oct. T., 1902, No. 102, reversing judgment of C. P. No. 1, Pbila. Co., June T., 1901, No. 2891, overruling defendant’s demurrer to plaintiff’s statement in case of Commonwealth v. Real Estate Trust Company of Philadelphia.
    Before Mitchell, C. J., Dean, Fell, Brown, Mestrezat, Potter and Elkin, JJ.
    Affirmed.
    Appeal from judgment of the Superior Court.
    ■ Plaintiff brought suit in assumpsit against defendant to recover $73.70 for a license tax assessed by the appraisers of mercantile taxes against defendant as a real estate broker in the city and county of Philadelphia during the year 1901, averring in the statement of claim that defendant’s sales amounted to $2,300 for the year 1901 upon which the tax was three per cent, or $69.00, the fee for the city $1.25 and the penalty $3.45. In response to defendant's rule for a more specific statement of claim, plaintiff further averred that defendant was liable to the payment of such tax by virtue of the acts of Pennsylvania of May 27,1841, as subsequently amended by the acts of April 10, 1849, May 15, 1850, and May 2, 1899.
    Defendant demurred to plaintiff’s statement assigning’ as reasons for demurrer: (1) That the acts of assembly of May 27, 1841, April 10, 1849, May 15, 1850 and May 2, 1899, did not authorize the assessment of such tax against defendant; (2) that there was no act of assembly or other authority authorizing the assessment of such tax; (3) that the defendant was not a real estate broker within the meaning of said acts of assembly.
    The court overruled defendant’s demurrer and entered judgment for plaintiff, under which damages were assessed at $77.15.
    The defendant appealed to the Superior Court, which reversed the judgment of the lower court and entered judgment for defendant. The present appeal was then allowed.
    Porter, J., filed the following opinion:
    The appellant was duly incorporated as a trust company under the act of 1874 and the supplement thereto, including the Act of May 19, 1889, P. L. 159, and it is authorized, among other things, to transact the business of buying and selling real estate. The commonwealth brought this action to recover the amount alleged to be due from the defendant for license tax as a real estate broker, and filed a statement averring the liability of the defendant under the provisions of the Act of May 27, 1841, P. L. 396 ; April 10, 1849, P. L. 570 ; May 15, 1850, P. L. 772; and the Act of May 2, 1899, P. L. 184. The appellant demurred to the statement and the court below entered judgment in favor of the plaintiff, from which judgment we have this appeal. Do the statutes upon which the commonwealth relies authorize the imposition of the tax in question upon this defendant?
    Statutory authority for the imposition of the tax in question must be shown. If there is no act of assembly conferring the power to impose the tax or license fee sued for in this case, the plaintiff is not entitled to recover. It is conceded that if authority for the tax is not found in one of the acts of assembly above referred to it does not exist. The act of May 2, 1899, P. L. 184, is entitled “ An act to provide revenue by imposing a mercantile license tax on venders of or dealers in goods, wares and merchandise, and providing for the collection of said tax.” There is nothing in the provisions of .that statute which would warrant the imposition of any tax or license fee upon real estate brokers, and it can have no bearing upon the consideration of the question raised by this record.
    The Act of May 27,1841, P. L. 396, is 'the foundation of the system for the-taxation of stock and exchange brokers; section one enacts “that from and after the first day of July, one thousand eight hundred and forty-one, when any individual or co-partnership residing in the city or county of Philadelphia shall have paid one hundred dollars (here follow provisions regm lating the amount of tax in other portions of the state), into the treasury of the county in which he or she or'they shall respectively reside, for the use of the commonwealth, with a view to the use and exercise of the business or occupation of a stockbroker, the treasurer of the proper county shall thereupon grant to such individual or copartnership, a commission in legal form, under the seal of the county authorizing him, her, or them to .purchase and sell as agents, or for the use and benefit of others jn the city or county to be designated in said commission, for such brokerage, commission or other compensation as may be agreed upon between the parties, any public loan or stock, etc., for the term of one year from the date of such commission.” The second section authorizes the issuing of a commission upon compliance with similar conditions, to any individual or copartnership, authorizing him, her, or them in like manner to exercise the business and occupation of an exchange broker. The third section authorizes the commission, upon like terms, of any individual or copartnership to exercise the business of a bill broker. The fourth section provides for the issuing of new commissions, “ For each and every succeeding year during which any individual or copartnership shall continue to use or exercise the business or occupation either of stock broker, exchange broker or bill broker.” This section also provides that in case either of the parties commissioned shall die, or shall remove from and cease to exercise the business or occupation of a broker, before the expiration of the term in the commission specified, the benefit of said commission for the unexpired term shall inure to and be continued in his, her, or their legal representative or assignee. Section 5 provides that “no individual or copartnership, other than those duly commissioned under the provisions of this act, shall use or exercise the business or occupation of a stock broker and exchange broker, or a bill broker, under a penalty of five hundred dollars for each and every offense.” Section 6 merely imposes a limitation upon the power to make contracts for the future delivery of stocks,- etc., while section 7 regulates the manner in which the county treasurer shall make settlement with the auditor general; neither of these sections have any bearing upon the question of' the power to tax. This statute dealt only with the exercise of the business or occupation of a broker, by any individual or copartnership; and prohibited the use or exercise of such business or occupation by an individual or copartnership other than- those duly commissioned under the provisions of the statute. The statute authorized the taxation of any individual or copartnership engaged in a particular business, that is, it designated as those subject to the tax, the individual, acting for himself, and the combinations of individuals associated as a partnership, engaged in a particular business. There is not in the statute any mention of corporations nor reference to the officers of corporations or companies, and if it is to be held that corporations can be taxed under this statute, it can only be upon the ground that “any individual,” as used in the act, included all corporations. A statute may, in designating those subject to a tax, employ terms so comprehensive, or the specific enumeration of .the subject of the tax may be so •extended by the context of the. statute that corporations as well as individuals may be included within its terms, although there may be no specific mention of corporations as • such: Commonwealth v. Potter Sons & Company, 159 Pa. 583; Commonwealth v. Bailey, Banks & Biddle Company, 20 Pa. Superior Ct. 210. The legislative intention is, however, in every case the paramount question. “ In the construction of statutes the terms or language thereof are to be taken and understood according to their ordinary and usual signification, as they are generally understood among mankind, unless it should appear from the context, and other parts of the statute, to have been intended otherwise; and if so, the intention o'f the legislature whatever it may be ought to prevail. ' Therefore, in the case before us, the term ‘ person ’ being generally understood as denoting a natural person, it is to be taken in that sense, unless from the context, or other parts of the act, it appear that artificial persons, such as corporations, were also intended to be embracedSchool Directors v. Carlisle Bank, 8 Watts, 289 ; Saving Fund v. Yard, 9 Pa. 359. The words “ any individual or copartnership ” do not usually include corporations when used in statutes or common parlance ; those terms are ordinarily if not universally accepted as meaning a natural person or an association of natural •persons. We find nothing in the act of 1841 which evinces an intent to include corporations with the expression used in designating those made subject to the tax. The act does not in express terms, nor by necessary implication, make corporations subject to taxation in the manner here proposed, and the attempt to Collect the tax is without authority, unless warrant can be found for it in some other statute : Appeal of Fox and wife, 112 Pa. 337. « ' ■
    The Act of April 10, 1849, P. L. 570, section 18, extended all the provisions of the act of 1841, above referred to, to real estate brokers and to merchandise brokers. The ■effect of this was to render such real estate brokers liable to be taxed in the same manner, and under the same circumstances and conditions as were those classes of brokers originally included within the act of 1841; that is, “ any individual or copartnership exercising the occupation.” The 17th section of the act of 1849 requires all stock brokers and bill brokers to pay “ the additional sum upon each license of fifty per cent, and exchange brokers one hundred per cent upon the amount which they are required to pay by the act of May 27, 1841, entitled, ‘ An act to authorize the licensing of stock brokers, exchange brokers and bill brokers, and to regulate contracts for the purchase and sale of loans and stocks.’ ” Let it be conceded for the purpose of this case that the section applies to real estate brokers, which is not, however, clear; the section did not extend the tax to any new .class, nor authorize any tax upon persons not included within the provisions of the act of 1841, the only effect of it was to add fifty per cent to the amount to be paid by those w'ho were .made subject to the tax under the provisoes of the act of 1841.
    The Act of May 15, 1850, P. L. 772, provides, “Section 7, that hereafter all stock brokers, bill brokers, exchange brokers, merchandise brokers and real estate brokers, in each and every city and county of the common wealth, shall be required to pay annually to the use of the commonwealth, for their respective commissions and licenses granted in pursuance of the several acts of assembly now in force relating to the same, upon their annual receipts from commissions, abatements, allowances and other similar means in the transaction of their business,-three per cent.” The eighth section regulates the manner of ascertaining and assessing the several brokers aforesaid, according to the amount of business done by them respectively. Section 9. Nothing in this act shall- be held or taken to repeal any' obligation, liability, penalty or duty imposed upon any broker by any existing law of this commonwealth, except only ,so far as the amount of the tax for a commission-, or license;.'provided that in classing said brokers, when an individual or copartnership desires to obtain a commission or •license to carry on business at the same timé in moré thafí bne of the kind of brokers named in the first part of the sixth section of this act, the amount of the annual receipts of said individual or copartnership, in each particular order, shall be estimated for the purpose of fixing the class as aforesaid, a separate commission or license shall be issued for each kind of broker as now provided by law.” It is contended on behalf of the commonwealth that this statute required the payment of a license tax by all real estate brokers, including corporations, without regard to whether artificial persons had by the several acts of assembly previously in force been required to take out a license. In determining whether it was the legislative intention to extend the tax to new subjects or merely change the amount of the tax to be paid by those who were already subject to the charge, we must consider the act as a whole and with regard to the nature of the tax as authorized by pre-existing laws. The act of 1841 made it unlawful for any individual or copartnership to engage in certain classes of brokerage business without having obtained a commission or license, provided a manner in which such individuals or co-partnerships might obtain a license, and fixed a schedule of license fees to be paid, varying only with regard to the locality where the business was to be carried on. The act of 1849 increased the schedule of license fees by 50 per cent, and extended the provisions of the act of 1841 to real estate brokers. There was nothing in this pre-existing legislation which made it unlawful for a corporation to engage in business as a real estate broker without having first obtained a license ; the right to do so being left wholly dependent upon the powers conferred by.its charter. Corporations were not required to take out a •commission or license, and were therefore not subject to the tax. The seventh section of the act of 1850 established a new rate of taxation, substituting for the pre-existing schedule of arbitrary fees dependent upon locality, a .'uniform rate of three per centum upon the-'receipts from commissions, discounts, etc. The form of the tax .was, however,' left uni-changed, although it .may be said, that the effect of the. act of 1850 was to make this change a tax' .upon income: Baiiger’s Appeal, 109 Pa. 7.9. It is still collected by the commonwealth as a charge Tor a license to engage in a certain occupation. The section of the statute, in question did nothing'more than change the manner in which the amount to be paid.for such license should be determined. All real estate and other brokers were required to pay annually, for their respective commissions or licenses granted “ in pursuance of the several acts of assembly now in force' regulating the same,” the amount to be determined under the provisions of this section. The classes of persons required to procure a license before engaging in the business was left unchanged; as was the authority from which the license must issue, and the eligibility of the licensee. There is nothing in the seventh section from which it could reasonably be inferred to be the legislative intention to authorize the issuing of a license to a corporation or company not eligible under previous statutes, nor to extend the tax to a class not liable under pre-existing laws. That section does not expressly declare that it shall be unlawful for a real estate broker to engage in business without a license, nor confer authority upon any officer to issue the license; it deals only with the amount which must be paid, “ for. . . . licenses granted in pursuance of the several acts of assembly now in force relating to the same.” Even if the construction of the seventh section of the act of 1850 were a matter of doubt, all uncertainty is dispelled by a consideration of the ninth section of the same statute. That section must be accepted as a legislative declaration that the legislative purpose was, so far as brokers were concerned, merely to change the amount of the tax for a license ; and in the provision for the classification of such brokers we have the licensees referred to as “any individual or copartnership,” the very language employed in the act of 1841 upon which the whole system is founded. The express provisions of these several statutes authorize the issuing of a commission or license as a real estate broker to an individual a natural person or copartnership only, and in hone of them do we find anything from which can.arise an implied authority to issue such license to a corporation, nor render it subjected to a license tax.
    The judgment is reversed, and judgment is now entered for the defendant with costs.

      Error assigned was judgment of the Superior Court.

      Ira J. Williams, with him Franklin L. Lyle and Hampton L. Oarson, for appellant.

      John G. Johnson, with him H. S. Prentis Nichols and Joseph De P. JunMn, for appellee.
    March 6, 1905:
   Pee Cueiam,

The judgment is affirmed by a majority of this court on the opinion of the Superior Court.


source: Caselaw Access Project

author: Mb. Justice Fell,

license: Public Domain

text:
    Miller v. Doyle, Appellant.

      Appeals—Failure to print testimony—Assignments of error—Receiver.

    Where a receiver has taken an appeal from an adverse decree, and, owing to lack of funds, has not printed the testimony, and it appears that the assignments of error present questions that cannot be determined without a review of the testimony, the decree of the lower court will be affirmed.

      Equity—Account—Corporations—Receiver—Corporation officers.

    The receiver of a corporation who asks for an accounting from its directors and the payment by them of an amount alleged to be due to the corporation, less credits to which they are entitled, has no standing to object because in stating the account the directors are allowed credit for money advanced by them to the corporation and for salaries due for services performed under an agreement with the corporation.

      Corporations—Officers—Salaries—Excessive salaries.

    A finding that the amount fixed for the salary of an officer of a corporation is excessive, does not deprive him of the right to an allowance of an amount found-to be reasonable.
    Argued Jan. 10, 1905.
    Appeal, No. 189, Jan. T., 1904, by plaintiff, and cross appeal, No. 292, Jan. T., 1904, by defendants, from decree of C. P. No. 4, Phila. Co., June T., 1902, No. 1482, on bill in equity in case of N. Dubois Miller, Receive! of the Pennsylvania Mutual Life Insurance Company v. John M. Doyle and William P. Elder.
    Before Mitchell, C. J., Dean, Fell, Beowh, Mesteezat, Pottee and Elkin, JJ.
    Affirmed.
    ■Bill in equity for an account.
    Audeneied, J., filed an opinion which was in part as follows :
    .. This bill was filed by the receiver of the Pennsylvania Mu.túal Life Insurance Company. It alleges that Doyle and Elder, two of its directors, who together held more than a majority of its shares, have converted to their own use certain of its assets, and prays “ an accounting between the said defendants and said companjr represented by him as its receiver and a decree in favor of the plaintiff as such receiver against the defendants jointly and severally, for the sum of $50,000 with interest, less any just credits which may appear due to said defendants or either of them.”
    The trial judge finds that the defendants as officers of the insurance company satisfied certain mortgages held by it to secure an indebtedness of $30*000 on sundry real estate owned by them individually, in exchange for certain obligations of the company held by them. This step was taken in pursuance of a settlement made between themselves as individuals and the company. The obligations canceled included certain claims for salary alleged to have been earned by the defendants or by other officers who had assigned their claims to them. The trial judge finds that on the canceled obligations the company actually owed the defendants $4,497.01 for salaries and for cash advanced for its account, with interest thereon, $6,779.54. Doyle and Elder thus appear to have satisfied mortgages aggregating $30,000 upon a payment of $11,275.55 only; and they are therefore charged with the difference, viz : $18,723.45. In addition to this the decree nisi charges the defendants with the sum of $1,666.66, which was illegally paid by the officers of the company to one Conroy and which was traced directly into their hands, they having at the time of its receipt full knowledge of the transaction. Against an aggregate charge of $20,390.11, the defendants are allowed a credit of $9,125.51 for salaries earned and cash advanced since the satisfaction of the mortgages, and they are required by the decree nisi to pay to the plaintiff the sum of $11,264.30 with interest.
    $$$$$$$$
    Such of the exceptions filed by the plaintiff as seem-worthy of notice raise three questions, which are as follows:
    1. It isr contended that the defendants should have been charged with an additional sum of $16,650, which is the amount ■of the shares for which a certificate-was issued'to Joseph Conroy, on the ground that they are jointly responsible with him for the subscriptions to those shares, and that its amount has not been paid into the company’s treasury.
    On this point we may observe that it is of little consequence whether or not the defendants were responsible for the subscription money that should have been paid in on the shares, for which a certificate was issued to Conroy December, 1895, because that money was fully paid, ten per cent thereof being paid in cash, and the balance by the delivery to the company of the bond and mortgage of one Shoemaker in the sum of $15,000. It is true that under a mistaken view of the law the defendants consented to the cancellation of Conroy’s certificate for these 333 shares, returned his $1,666.66 to him and satisfied the Shoemaker mortgage, but this resulted in a loss of only $1,666.66 to the company, since immediately on being advised of the illegality of that step, the defendants compelled Shoemaker to substitute, in the place of that which had been satisfied, a new mortgage identical with it in amount and security. It was not proved that this mortgage lacked security when it was given to the company, although it seems to have since been discharged as a result of proceedings on a prior lien; and even if this fact be taken as evidence that the mortgage moneys were insufficiently secured, there is no evidence before us to show that the defendants had knowledge of its lack of security or to charge them with the responsibility of making a bad investment. With the $1,666.66 lost as above mentioned the defendants have in fact been charged.
    On the question whether the defendants were joint subscribers with Conroy for the whole of the thousand shares issued in December, 1895, we are satisfied that the finding of the trial judge is correct.
    2. It is objected to the trial judge’s findings that the defendants should have been required to pay the plaintiff whatever moneys of the company they paid to themselves illegally, whether by mistake or not, without any allowance of credit, and that their counterclaims for salary and cash advances should be postponed for adjudication to the audit of the receiver’s account.
    In this view of the matter we cannot concur. To answer the plaintiff’s objection it is necessary only to refer to the prayer of his bill, which has been quoted above. He prays for an. accounting, and cannot therefore reasonably object when-an account is stated. He prays for a decree for the payment to him by the defendants of $50,000, less any just credits which may appear due to said defendants or either of them. Surely it comes with bad grace to complain that the trial judge has endeavored to ascertain to what credits the defendants are entitled against the sum which they withdrew from the company’s assets. If the company owed much it might be our duty to overlook the letter of the plaintiff’s request and relegate the defendants to proof of their claims before the auditor to be appointed to distribute the fund in the hands of the receiver, so that they should receive their just pro rata along with other creditors. But it nowhere appears that the company owes a dollar except to the defendants themselves and to Robert E. Doyle, who holds its life policy for $1,000. To meet the company’s contingent liability on that policy and the expense of these proceedings the balance of $11,264.60 found against the defendants will amply suffice. To require them to pay more would benefit nobody but the receiver and his counsel, and with their profit in this matter we ought not to concern ourselves to an extent beyond seeing that they receive reasonable compensation for their services.
    3. It is urged that if an accounting he gone into at this time the defendants should not be allowed any credit whatever in respect to salary. The plaintiff’s argument in support of this is reducible to the proposition that the officers of a corporation who happen to be also members of its board of directors in which body is vested the duty of fixing salaries, are entitled to no salary at all if- the board of which they are members votes them a salary which is unreasonably high. To state such a proposition is to refute it. All that can possibly be asked is that the salary voted shall be cut down to reasonable limits. It can make no difference that the salaries voted to the defendants were fixed with a view to helping them to get rid of their mortgage obligations to the company. If they were excessive, they were excessive and no more, no matter what purpose the defendants and their friends may have had in mind in voting them. It is unimportant whether they were paid by the cancellation of the company’s securities or by the transfer of the company’s property. The only salary which the trial judge has allowed the defendants is in respect to services performed by them subsequent to the time when the salaries were voted to them. If no salaries had been voted the defendants would have been entitled to claim nothing for their services from the company because of the presumption of law that has been referred to in the discussion of the first point raised by the exceptions. The resolution of the directors, adopted May 7,1896, providing for the payment of salaries to the directors, must at least be given the effect of rebutting the presumption that their services thereafter were to be rendered gratuitously. It is clear that from that date on there is no ground whatever for the assumption that the defendants intended to serve the corporation without pay. The trial judge Las given no greater effect to the resolutions just mentioned than this. Pie has treated the defendants and the other officers of the corporation as if they had undertaken to work for whatever their services were reasonably worth. That they have served the corporation in the handling of its complicated and delicate business affairs, is undisputed. The compensation which the trial judge has fixed for them, in the light of the evidence adduced before him, seems to us to be perfectly reasonable, and we are satisfied that the defendants are entitled to the allowance given them.
    In addition to these objections the plaintiff has excepted to-many findings of facts on minor or unimportant points. In reference to these objections it is needless to say more than that a careful reading of the pleadings and the proofs reveal no reason to disturb the findings of the trial judge.
    For the reasons above outlined we have determined to dismiss all the exceptions filed by both of the parties to this cause, and to make absolute the decree nisi entered on the findings.
    Counsel will prepare a form of final decree to be entered in the cause for the payment of a specific sum of money by the defendants to the plaintiff, which sum shall include interest calculated on the basis indicated by the decree nisi up to the date of the filing of tins opinion.

      Error assigned was the decree of the court.

      John J. Ridgway, with him J. Rodman Paul, for the receiver.

      Alex. Simpson, Jr., with him Joshua B. Morgan, contra.
    March 6, 1905 :
   Opinion by

Mb. Justice Fell,

The appellant, having no funds in hand as receiver, has not printed the voluminous testimony taken at the trial but accepts the court’s findings of fact, and we are asked to consider only the assignments of error-which relate to the inferences drawn from the facts as found and to the law as applied thereto. We are met, however, at the outset by the difficulty that the first two assignments present questions that cannot be determined without a review of the testimony.

The bill was filed by the receiver of an insurance company to secure an accounting by two of its directors who, it was alleged, had converted certain of its assets to their own use. In the decree entered May 5, 1904, they are charged with interest on “ excessive credits on mortgages canceled ” from November 17,1897, the date when the mortgages were satisfied. It is claimed in the first assignment that they should have been charged with interest on the full amount of these mortgages before deducting the company’s indebtedness to them. Prima facie this contention is correct. But it does not appear that any request was made for a finding on the subject, and it does appear that as subscribers to a guarantee fund, the defendants were entitled to interest on the amount of their subscriptions represented by these mortgages. The interest charges would in this way be equalized. This fully explains what on the face of the account appears to be an error, and in the absence of the testimony we must accept the finding as correct.

The second assignment, that “ The court erred in not finding the indebtedness of the defendants to be $46,667 with interest,” gives rise to a pure question of fact that cannot be considered without the testimony. The remaining assignments are fully answered in the carefully considered opinion of the court.

The decree is affirmed at the cost of the appellant, and the cross appeal of the defendants, No. 292, January Term, 1904, is dismissed.


author: Mb. Justice Mestbezat,

text:
    Severns’s Estate
    (No. 1).

      Will—Power of sale—Conversion—Intention—Partition.

    An intention to convert real estate into personalty will be implied where the executor is authorized to make a sale, and there is an absolute necessity to sell, to carry out the provisions of the will; and this is so although there is not to be an immediate sale, and the time of the sale is discretionary with the executor.
    Testatrix died seized of a residence, and leaving to survive her three daughters, one married and two unmarried. She appointed one of the unmarried daughters her executrix and authorized and empowered her to sell the residence “whenever and upon such terms as she may deem best, and to grant and convey the same to the purchaser or purchasers thereof free from all liability for or on account of the application of the purchase money. The proceeds of the sale of the said premises I direct my said executrix to divide among my said three daughters share and share alike.” She further directed that the two unmarried daughters should have the sole right to occupy the residence “free of rent, taxes and water rent until the same shall be sold.” Held (1), that the will worked a conversion of the real estate into personalty; (2) that the married daughter had no standing to demand partition of the real estate.
    Argued Jan. 10, 1905.
    Appeal, No. 200, Jan. T., 1904, by Clara W. Raleigh, from decree of O. C. Phila. Co., April T., 1902, No. 362, dismissing petition for partition in estate of Harriet M. Severns, deceased.
    Before Mitchell, C. J., Dean, Pell, Brown, Mestrezat, Potter and Elkin, JJ.
    Affirmed.
    Petition for partition. Before Penrose, J.
    The opinion of the Supreme Court states the case.

      Error assigned was in dismissing petition for partition.

      Joseph P. McOullen, for appellant.
    There was no conversion : Cooper’s Estate, 206 Pa. 628 ; Poster’s App., 74 Pa. 391; Anewalt’s App., 42 Pa. 414; Chew v. Nicklin, 45 Pa. 84; Bleight v. Bank, 10 Pa. 131; Neely v. Grantham, 58 Pa. 433 ; Miller & Bowman’s Appeal, 60 Pa. 404 ; McClure’s Appeal, 72 Pa. 414; Sheridan v. Sheridan, 136 Pa. 14 ; Darlington v. Darlington, 160 Pa. 65; Sauerbier’s Estate, 202 Pa. 187.

      James Alcorn, for appellee.
    There was an equitable conversion by the will: Keim’s Estate, 201 Pa. 609; Rauch’s Est., 21 Pa. Superior Ct. 60 ; Sauerbier’s Est., 202 Pa. 187; Stallman’s Estate, 2 Pa. Dist. Rep. 265; Selfridge’s Appeal, 9 W. & S. 55; Neely v. Grantham, 58 Pa. 433; Jones v. Caldwell, 97 Pa. 42; Roland v. Miller, 100 Pa. 47; Fahnestock v. Fahnestock, 152 Pa. 56; McClellan’s Estate, 158 Pa. 639; Weeter’s Estate, 21 Pa. Superior Ct. 241.
    March 6, 1905 :
   Opinion by

Mb. Justice Mestbezat,

Harriet M. Severns died April 27,1901, testate, leaving to survive her three daughters, Clara W. Raleigh, the petitioner, Florence J. Severns and Minnie Severns. At the time of her death Mrs. Severns was seized of a certain lot of ground with the improvements thereon at No. 1127 Spruce street in the city of Philadelphia. She appointed her daughter, Florence J. Severns, to be the executrix of her will which was probated May 9,1901; the fourth item of which is the only part material to the question involved in this appeal, and is as follows : “ I authorize and empower my executrix hereinafter named to sell at public or private sale the premises No. 1127 Spruce street in the city of Philadelphia whenever and upon such terms as she may deem best and to grant and convey the same to the purchaser or purchasers thereof free from all liability for or on account of the application of the purchase money. The proceeds of the sale of the said premises I direct my said executrix to divide among my said three daughters share and share alike. My two daughters, Florence and Minnie, are to have the sole right to occupy the said dwelling No. 1127 Spruce street free of rent, taxes and water rent until the same shall be sold.” Mrs. Raleigh presented her petition to the court below averring that the deceased died seized of said real estate, that the petitioner and her said two sisters were the only parties interested therein, that they derived, title by virtue of said item of the will, and praying the court to award an inquest to make partition. A citation was issued, and an answer was filed by Florence J. and Minnie Severns. They denied the right of the petitioner to have partition of the premises “because she has no interest in the said premises as real estate, but is only entitled to a one-third of the net proceeds when the same shall be sold in accordance with the will of the said Harriet M. Severns, deceased.” The orphans’ court held that the will worked a conversion of the real estate into personalty and that, therefore, the petitioner had no title to the real estate as such and dismissed the petition for partition.

There must be a positive direction or a clear intention disclosed by the will to sell in order to work a conversion of real estate into personalty. Equitable conversion takes place only when the will discloses a clear intention that the nature of the property shall be changed. The basis of this doctrine is that, in equity, that is regarded as done which the testator intends shall be done. Conversion, therefore, is a question of intention, and where the intention to convert clearly and explicitly appears by the provisions of the will, it is equally effective as a positive direction contained in the instrument. It has been uniformly held by this court that an intention to convert will be implied where the executor is authorized to make a sale and there is an absolute necessity to sell in order to carry out the provisions of the will. “If a testator authorizes his executors to sell his real estate and to execute and deliver to the purchasers deeds in fee simple, of the same, as in this case,” says McCollum, J., in Fahnestock v. Fahnestock, 152 Pa. 56, “ and it is clear from the face of his will that it was his intention that the power so conferred by him should be exercised, it will be construed as a direction to sell, and operate as an equitable conversion. If in addition to this clear intention of the testator it plainly appears that effect cannot be given to material provisions of the will without the exercise of this power, the conclusion is irresistible that a conversion is as effectually accomplished by the will, and the duties of the executors under it are the same, as if it contained a positive direction to sell.” It is also settled law that if the will shows a clear intention that the estate shall be sold, a conversion will take place though there is not to be an immediate sale: McClure’s Appeal, 72 Pa. 414; or the time of sale is discretionary with the executor: Roland v. Miller, 100 Pa. 47; Philadelphia’s Appeal, 112 Pa. 470.

There is no difficulty in ascertaining the intention of the testatrix from the provisions of Mrs. Severns’ will. She does not devise her real estate, but empowers her executrix to sell without any alternative disposition of it. It is not given as real estate to the persons named in the will, nor to any other person for any purpose whatever, but, in the language of the instrument, “ the proceeds of the sale of the said premises I direct my said executrix to divide among my said three daughters share and share alike.” We, therefore, have in the will an authority given to the executrix to sell and a direction to divide the proceeds of the sale in equal shares among the three legatees. In order to carry out the provisions of the will and make that distribution of the proceeds of the property, a sale of the real estate becomes imperative and is an absolute necessity. This, as appears from the authorities cited above, meets the requirements of our cases and operates as an equitable conversion. The fact that the time when, and the terms upon which, the sale should be made are discretionary with the executrix does not give the latter authority to prevent a sale, nor to postpone it indefinitely. The discretion reposed in the executrix is a reasonable and not an arbitrary one, and must be exercised to carry out the plain intention of the testatrix that the property shall be converted into personalty and the proceeds distributed equally among the three sisters.

The provisions of the will of Mrs. Severns operated as a conversion of her Spruce street property, and hence, the writ of partition was properly refused.

The decree is affirmed.


author: Mr. Justice Mestrezat,

text:
    Severns’s Estate
    (No. 2).

      Will—Power of sale—Discretionary power—Failure to act.

    Testatrix died seized of a dwelling house, and leaving to survive her three daughters, one married and two unmarried. She appointed one of the unmarried daughters her executrix and authorized and empowered her to sell the residence “whenever and upon such terms as she may deem best, and to grant and convey the same to the purchaser or purchasers thereof free from all liability for or on account of the application of the purchase money. The proceeds of the sale of the said premises I direct my said executrix to divide among my said three daughters share and share alike.” She further directed that the two unmarried daughters should have the sole right to occupy the residence “free of rent, taxes and water rent until the same shall be sold.” The executrix made no effort or attempt to sell the property for three years after the death of the testatrix, and when she was cited to show cause why she should not sell, answered that the time of the sale was discretionary in herself and that the condition of the real estate market did not warrant a sale. The other unmarried sister joined in the answer and in the opinion that the time was not suitable for offering the property for sale. The answer did not disclose that the sisters had any knowledge of the value of real estate in the neighborhood, or that they had consulted any parties who were informed on the subject. Held, that the answer was insufficient, and that the court would direct the executrix to sell the property in accordance with the provisions of the will.
    Argued Jan. 10, 1905.
    Appeal, No. 201, Jan. T., 1904, by Clara W. Raleigh, from decree of O. C. Pliila. Co., April T., 1902, No. 362, dismissing petition for sale of real estate in Estate of Harriet M. Severns, deceased.
    Before Mitchell, C. J., Dean, Fell, Brown, Mestrezat, Potter and Elkin, JJ.
    Reversed.
    Petition for order to sell real estate. Before Hanna, P. J.
    The court dismissed the petition.

      Error assigned was the decree of the court.

      Joseph P. Me Cullen, for appellant,
    cited: Rogers’ Estate, 185 Pa. 428 ; McClane v. McClane, 207 Pa. 465; Hall’s App., 112 Pa. 42.

      James Alcorn, for appellee.
    A discretion vested in an executor cannot be interfered with by the court, nor can lie be compelled by the court to exercise it: Wilson’s Appeal, 1 W. N. C. 321; Parsons’s Estate, 82 Pa. 465; Peterson’s Appeal, 88 Pa. 397 ; Seeds v. Burk, 181 Pa. 281.
    March 6, 1905 :
   Opinion by

Mr. Justice Mestrezat,

By her will, dated July 22, 1890, probated May 9, 1901, Harriet M. Severns provides, inter alia, as follows: “ Fourth : I authorize and empower my executrix hereinafter named to sell at public or private sale the premises No. 1127 Spruce street in the city of Philadelphia whenever and upon such terms as she may deem best and to grant and convey the same to the purchaser or purchasers thereof free from all liability for or on account of the application of the purchase money. The proceeds of the sale of the said premises I direct my said executrix to divide among my said three daughters share and share alike. My two daughters Florence and Minnie are to have the sole right to occupy the said dwelling No. 1127 Spruce street free-of rent, taxes and water rent until the same shall be sold.” The testatrix left to survive her three daughters ; Clara W. Raleigh, Minnie Severns and Florence J. Severns, the last of whom was appointed the executrix of the will.

Mrs. Raleigh presented her petition to the court below setting forth the above facts and further “ that over a year and a half ago the account of the said executrix covering the assets and property of said estate of Harriet M. Severns, other than the said real estate and premises No. 1127 Spruce street, was duly filed, audited and settled, and that there remains for her nothing to do as executrix but to sell said real estate and to divide the proceeds thereof; ” that although the testatrix had been dead for almost three years, the executrix had made no effort to sell said real estate and' divide the proceeds as directed by the will; that in her desire and with the intent to prolong her occupancy of the premises the executrix had, in abuse of the discretion vested in her by the will, refrained from attempting to sell and dispose of the real estate to the injury of the petitioner; and praying that a citation be awarded requiring the executrix to show cause why she should not sell the real estate and divide the proceeds as directed by the will. Florence J. Severns, the executrix, filed an answer in which she averred that she was given discretionary power as to the time and terms of sale of the premises, and denied that in not making the sale she had abused the discretion vested in her; that she alone was to determine when it was proper and advisable to make the sale; that at no time since her mother’s death has she considered the property could have been sold to advantage and that in her judgment it was inadvisable to make sale of the premises, as the condition of the real estate market in that locality was not such as in her opinion the premises would have sold for such price as should be obtained for it. Her sister Minnie joined in the answer, setting forth in the paper filed by her, “ that I do not desire that the said premises should be sold until a more advantageous time and do not believe that it would be to my interest or the interest of any of the others entitled to share therein to dispose of the said premises at the present time.” The application was heard'on the petition and answer, and the court dismissed the petition holding that “ from the answer it clearly appears the court at present has no jurisdiction to interfere with the discretion given the executrix by the will of the testatrix.” In the opinion it is also said: “ There does not appear to be an abuse of this discretion, and very good reasons are set forth by the executrix for her delay in disposing of the real estate; and in this delay she is joined by her sister, thus making two of the three parties interested in the premises.”

In an opinion filed herewith in this same estate in an appeal by this appellant, we have affirmed the decree of the orphans’ court in refusing, on appellant’s application, an inquest to make partition of this real estate on the ground that the will worked a conversion of the property into personalty, and hence the appellant had no interest in the real estate, but only in the proceeds after it was sold.

In Erisman v. Directors of the Poor, 47 Pa. 509, the court says: “ The objection that this dispenses with the discretion of the trustee (named in the will) has no merit. Ilis discretion is but a legal one, and whenever the law determines that a proper case has arisen in which the trustee’s discretion should have been exercised in a particular way he will'be constrained to act in accordance therewith.” In Williams’s Appeal, 73 Pa. 249, Agnew, J., delivering the opinion says': “A chancellor will so control a trustee that he shall not disappoint the true intent and purpose of the donor, as gathered from the instrument containing the power. To execute it otherwise is a fraud on the power. Hence, it is said, ‘he must execute it bona fide for the end designed.’ ” In the opinion of the orphans’ court in Laughlin’s Estate, 181 Pa. 333, upon which the decree was affirmed by this court, it is said: “ It was argued that the power of sale given the executors was discretionary and only operated as a conversion from the date of its exercise. But this power is plainly discretionary only as to the time of its exercise. The executors were empowered, ‘ when in their judgment they should find it prudent or for the best interests of the legatees and devisees.’ The discretion was legal and its exercise could have been compelled: Erisman v. Poor Directors, 47 Pa. 509. When a discretionary power becomes imperative, it must be regarded as a trust; for, unless it is executed the legatees cannot be paid, and the will is thereby defeated.”

We do not regard the answer in this case as furnishing sufficient grounds to justify the court below in refusing to direct the executrix to proceed to execute the power conferred on her to make sale of the Spruce street property. There was no discretion vested in her as to the sale, as that was absolutely necessary to carry into effect the provisions of the will, and hence the testatrix must be regarded as having given a positive direction to sell. The discretion of the executrix was confined to the time and the terms of sale. She, however, was required to exercise her discretion in this respect so as to carry out the intention of the testatrix as disclosed by the will. She could not arbitrarily refuse to make a sale and thereby defeat the purposes of the will and prevent the legatees from receiving the proceeds of the property. Neither can she be permitted to unduly or indefinitely postpone a sale which will deprive the beneficiaries of realizing their legacies within a reasonable time, as is clearly contemplated in the will. Her discretion if thus exercised would defeat the manifest purpose of the testatrix. The three daughters were alike in the affections of their mother and the testatrix intended that they should share alike in the proceeds of the property. The fact that the unmarried daughters were to occupy the dwelling house until the sale of the property does not indicate an intention that theré should be any discrimination in their favor by undue delay in making the sale, and hence it presents no grounds for postponing it. Their occupancy was manifestly expected and intended by the testatrix to be temporary and of short duration. The protection of the property made it necessary that it should be occupied until it was sold, and it was quite natural that the two unmarried daughters, who were doubtless residing in the house with their mother at the time of her death, should remain there until the executrix had disposed of it as directed by the will.

The learned judge gave too much weight to the answer under the circumstances of the case. The executrix was not a stranger to the beneficiaries, nor disinterested as to the time when the sale should be made. On the contrary, it was to the interest of the executrix and her unmarried sister that the sale should be postponed and that the actual conversion of the property-should not take place as long as it could be deferred. During the interim between the death of their mother and the sale, they were “to have the sole right to occupy said dwelling No. 1127 Spruce street free of rent, taxes and water rent.” The appellant, the other sister, during this period was deprived of the use of the property and its proceeds, and was compelled to pay her share of the taxes and water rent charged against it. The interest of the two unmarried sisters in retaining the property in its present shape is, therefore, apparent and should have been considered by the orphans’ court in determining whether the discretion vested in the executrix by the will had been abused. The grounds for refusing to carry out the power to sell were, as set forth in the answer, the discretion of the donee and the opinion of the executrix that the condition of the local real estate market was not such that the property would bring the price that should be obtained for it. The first of these reasons is sufficiently met by the fact that the discretion is a reasonable and not an arbitrary one, and that at the time this application was made, as appears by the uncontroverted averment of the petition, about three years had elapsed since the death of the testatrix without any effort having been made by the executrix to sell the property. The other reason, that the condition of the real estate market did not warrant a sale, is supported only by the opinion of the two unmarried sisters who were occupying the premises. They do not disclose what, if any,' knowledge they have of the values of real estate in that community. They do not aver that they consulted any parties whose business gave them an opportunity to be informed on the subject. It is simply the opinion of an interested party in a matter about which ordinarily she would have no information. This should not have been permitted to outweigh the undisputed facts averred in the petition.

The discretion vested in the executrix was a legal one and under our authorities its exercise may be compelled. The provisions of the will imperatively require a conversion of the property, and the executrix is permitted to exercise her discretion simply as to thé time and terms of the sale. The neglect or refusal of the executrix to make any effort or attempt to sell the property for three years, coupled with the fact that she has the use of it free of rent and taxes until it is sold, places upon her the burden of showing to the court some satisfactory reason for the delay in executing the power conferred by the will, and that burden is not met by the simple declaration of the donee of the power, made in her own interest and not supported by the testimony of any disinterested party.

The decree is reversed, and unless a good and sufficient cause be shown why the real estate in question should not be sold, the court below is directed to require the executrix to sell the same in accordance with the provisions of Mrs. Severns’ will. It is ordered that the cost of these proceedings in this court and the court below be paid by Florence J. Severns.


author: Mb,. Justice Mestrezat,

text:
    Bruner, Appellant, v. Finley.

      Ejectment—Quashing writ—Res adjudicata.

    An original writ can be quashed only when it is irregular, defective or improper.
    Where a writ of ejectment in proper form has been duly served and an appearance entered for the, defendant, the court cannot quash the writ on a rule to show cause resisted by plaintiff, and founded on the affidavit of one of the defendants which averred that in a former suit in equity between the same parties, or their predecessors in title, “ the rights and title involved were identical with those involved in the present suit, and every such right and title so involved in said equity suit and in this ejectment suit was finally decided against the plaintiff herein by the Supreme Court.”
    The syllabus in Rosenberg v. Mencke, 208 Pa. 331, corrected and explained.
    The proper plea in ejectment is “not guilty,” and under this plea, the defendants can avail themselves of the defense of res adjudicata.
    Argued Jan. 12, 1905.
    Appeal, No. 192, Jan. T., 1904, by plaintiff, from order of C. P. No. 1, Phila. Co., Dec. T., 1903, No. 333, making absolute rule to quash writ of ejectment in ease of Meta N. Bruner v. Annie B. Finley et. al.
    Before Mitchell, C. J., Dean, Fell, Beown, Mestrezat, Pottee and Elkin, JJ.
    Reversed.
    Ejectment for land in the city of Philadelphia. Before Biddle, P. J.
    The facts appear by the opinion of the Supreme Court.

      Error assigned was order making absolute rule to quash writ of ejectment.

      A. J. II. Frank, for appellant.
    The writ was improperly quashed: Bolton v. Robinson, 13 S. & R. 193; Sherer v. Easton Bank, 33 Pa. 134; Schenley v. Com., 36 Pa. 29; Crawford v. Stewart, 38 Pa. 34; Poor v. Colburn, 57 Pa. 415; Steel v. Goodwin, 113 Pa. 288.

      Jas. Aylward JDevelin, for appellees.
    The rule to quash is the proper remedy both on reason and authority : Rosenberg v. Mencke, 208 Pa. 331; Gordinier’s App., 89 Pa. 528 ; Stephens v. Stephens, 1 Phila. 108 ; Nicolls v. McDonald, 101 Pa. 514; Peterman v. Huling, 31 Pa. 432.
    March 6, 1905 :
   Opinion by

Mb,. Justice Mestrezat,

The syllabus of the official report of the case of Rosenberg v. Mencke, 208 Pa. 331, is at least partly responsible for the error of the court below in quashing this writ. The last sentence of the syllabus is misleading and a misstatement of what was decided in the case. Two ejectments were brought for the land in controversy in that case. The first action was by Mencke against Rosenberg in which there was a judgment in the trial court for the defendant. On appeal to this court, the judgment was reversed and a new venire awarded: 202 Pa. 131. When the case was again called for trial in the common pleas, the plaintiff suffered a judgment of non pros. Rosenberg then brought an action of ejectment for the same premises against Mencke. The defendant took a rule to quash the writ on the ground that the former action between the same parties was upon an equitable title and hence the judgment in that ease was a bar to another action of ejectment for the same premises between the same parties. The facts were agreed upon by the parties and, for the reason for which the rule was issued, the trial court made it absolute and quashed the writ. No question of the right of the court to determine the merits of the ease on the rule was raised by the plaintiff, When the case came into this court on appeal, it is true, the error formally assigned was the order quashing the writ; but the plaintiff ignored the question of practice, and each party based his right to a decision in his favor, on his view of the question of the conclusiveness of the judgment in the former action. The plaintiff acquiesced in the right of the court to determine the merits of the cause on the rule to quash, and in this court, as will appear in the official report of the case, the argument of both parties was confined to the single question whether the first judgment was upon an equitable title and therefore conclusive. That was the only question decided in the case and it is correctly stated in the first part of the syllabus. The decision did not determine that, under the facts of this case, “ if such second ejectment is brought the writ will be quashed,” against the objection of the plaintiff. That question was neither argued nor determined in this court, and the case must not be regarded as a precedent in support of the authority of the trial court to determine the merits of the cause on a rule to quash the writ.

The facts of this case may be briefly stated. The plaintiff brought an action of ejectment against the defendants on November 11, 1903, and the writ was duly served and an appearance was entered by counsel. Pursuant to a rule for the purpose issued at the instance of the defendants, the plaintiff, after many unsuccessful attempts, succeeded in filing a satisfactory “ amended declaration and abstract of title. ” The defendants thereupon obtained a rule on the plaintiff to show cause why the writ should not be quashed. This rule was founded on the affidavit of one of the defendants which averred that in a former suit in equity between the same parties, or their predecessors in title, “ the rights and title involved were identical with those involved in the present suit, and every such right and title so involved in said equity suit and in this ejectment suit was finally decided against the plaintiff herein by the Supreme Court.” The plaintiff filed an answer in which she averred that the rule was not founded upon any sufficient grounds, and that the only manner in which the defendants could avail themselves of the decision in the equity suit “ would be by plea of former recovery, or the plea of not guilty in ejectment, under which it would be one of the issues to be tried by the jury and cannot be a ground for quashing the writ.” The learned court below sustained the contention of the defendants for the reasons set forth in the following brief and effective, if not convincing, opinion: “ This case was fully considered by the Supreme Court in 187 Pa. 389, and the decision therein ought to be an end of the matter.* Under the authority of Rosenberg v. Mencke, 208 Pa. 331, this rule is made absolute.”

It was manifest error to quash the writ of ejectment on the ground set up in the affidavit of the defendants that there had been an adjudication of the rights of the parties in the former equity suit. An original writ can be quashed only where it is irregular, defective or improper. It is not alleged that either of these reasons for quashing the writ obtain in this case. The writ was issued by a court of competent jurisdiction, by the proper officer of the court under his seal of office on precipe of counsel, and was not defective or irregular in any respect. There was therefore no ground for quashing the writ. Bolton v. Robinson, 13 S. & R. 193, was a scire facias on a recognizance given on an appeal from an award of arbitrators. The recognizance was void and on that ground the trial court' quashed the writ. In reversing the judgment, Mr. Justice Duncan said : “ But I am not able to find any principle to justify the court in quashing the writ. The writ itself is a good writ; it sets forth a recognizance in legal form, and a forfeiture of it; it shows a good cause of action; the defendant should have been put to plead or to answer it, and the plaintiff could not be put out of court in this brief way. The judgment quashing the writ must, on this ground, be reversed with directions to the court of common pleas to reinstate the action.” Crawford v. Stewart, 38 Pa. 34, was debt on a surplus bond given by the purchaser of land sold for taxes. The court quashed the writ on the ground that the cestui que use had no right to bring the suit and must show that he was the original owner of the land at the time of the tax sale. The order quashing the writ was reversed, and in the opinion of the court it is said : “ When the writ was quashed it stood on the record, purely and simply an action of debt—'Unobjectionable in form, between competent parties—wherein there was due service of process, appearance, and plea by the defendant. There was no irregularity anywhere and the court had undoubted jurisdiction of both the subject-matter and the parties. Under such circumstances, wherein consisted the right of the court to dispose of the case in such a summary manner, against the consent of the plaintiff, as they did? The usual, and I think only, ground for the exercise of such a power is to clear the record of irregular, void or defective proceedings. ‘Where proceedings are clearly irregular and void,’ says Bouvier, 3d Inst. n. 3342, ‘ the courts will quash them, both in civil and criminal cases. . . .’ Thus it appears that this remedy is defined as only applicable to irregular, defective or improper proceedings. It would be extremely hazardous to extend it to any other case, unless where there was a consent of parties.” This case is cited with approval in Steele v. Goodwin, 113 Pa. 288, where it is held that the power of quashing writs is limited to proceedings that are irregular, defective or improper.

The case in hand was an action of ejectment, and the proper plea, as directed by the statute, is not guilty. Under the plea, the defendants can avail themselves of the defense of res judicata, the ground on which the writ was quashed : Cist v. Zeigler, 16 S. & R. 282; Zeigler v. Fisher, 3 Pa. 365 ; Finley v. Hanbest, 30 Pa. 190; Black v. Tricker, 52 Pa. 436; Gosser v. Hickenlooper, 81* Pa. 281; Westcott v. Edmunds, 68 Pa. 34. The last case cited was an equitable ejectment. At the trial at nisi prius, before Thompson, C. J., the defendants offered in evidence the record and final decree in a former suit in equity between the same parties involving the same subject-matter. The evidence was excluded, and there being a conditional judgment for the plaintiff the defendant took a writ of error, assigning for error the rejection of his offer of evidence. The judgment was reversed. It was held that the final decree in equity was a bar to the suit at law and that the effect of the decree was the same whether offered in evidence or pleaded.

The same rule is applied in a suit in equity where the defendant seeks to avail himself of a former adjudication as a bar to a hearing on the merits. He must set up the former recovery by proper averments in his pleadings, and cannot take advantage of it by a motion to dismiss the bill; unless, possibly, where the bill itself discloses the former adjudication and the objection may be taken by demurrer: 9 Am. & Eng. Ency. of Pl. & Pr., 616; Givens v. Peake, 1 Dana, 225; Majors v. Majors, 58 Miss. 806.

The order of the court below, quashing the writ is reversed, the writ is directed to be reinstated and a procedendo is awarded.


author:
Mb,. Justice Mestrezat,
      Mb. Chief Justice Mitchell,

text:
    O’Rourke, Appellant, v. Philadelphia.

      Municipal contracts—Contract in writing—Extra work—Act of June 1, 1885, P. L. 37.
    Where a city contractor signed a municipal contract protesting that certain of the work mentioned in the contract was not in the specifications submitted to him, and that he would claim for the extra work, and it appears that the contract on its face shows that it was executed under and subject to the Act of June 1, 1885, P. L. 37, the contractor after having done the work mentioned in the contract and received the price therein stipulated, cannot maintain a suit against the city for the work included in the contract and not mentioned in the specifications, although a city ordinance was passed by a two-thirds vote of each branch of council and signed by the mayor, appropriating money for the payment of such work.
    Mitchell, C. J., dissents.
    Argued Jan. 16, 1905.
    Appeal, No. 165, Jan. T., 1904, by plaintiff, from order of C. P. No. 3, Pbila. Co., Sept. T., 1899, No. 130, sustaining exceptions to report of referee in case of Michael O’Rourke v. City of Philadelphia.
    Before Mitchell, C. J., Dean, Fell, Brown, Mestkezat, Potter and Elkin, JJ.
    Affirmed.
    Assumpsit for work done on municipal improvements.
    Exceptions to report of Joseph W. Gross, Esq., referee.
    The opinion of the Supreme Court states the case.

      Errors assigned were in sustaining exceptions to report of referee.

      Edwin Jaquett Sellers and John Gr. Johnson, for appellant.
    Plaintiff was entitled to recover: Wright v. Philadelphia, 8 W. N. C. 141; Gate v. Philadelphia, 14 W. N. C. 274 ; Doll v. Philadelphia, 16 Phila. 142; Philadelphia v. Hays, 93 Pa. 72 ; Silsby Mfg. Co. v. Allentown, 153 Pa. 319; Shiloh Street, 165 Pa. 386 ; Amberson Ave., 179 Pa. 634 ; Chester v. Eyre, 181 Pa. 642; Harrisburg v. Shepler, 7 Pa. Superior Ct. 491.

      James Alcorn, assistant city solicitor, with him John L.-Kinsey, city solicitor, for appellee.
    It is well established that the city of Philadelphia cannot be liable for work done for it except under a contract in writing duly executed as required by the Act of June 1, 1885, P. L. 37 : Smart v. Philadelphia, 205 Pa. 329; McManus v. Philadelphia, 201 Pa. 619 ; Hepburn v. Philadelphia, 149 Pa. 335; Malone v. Philadelphia, 147 Pa. 416.
    The plaintiff cannot recover for the work as extra work, nor can he recover unless he has a contract in writing as required by the act of 1885 : Addis v. Pittsburg, 85 Pa. 379.
    March 6,1905 :
   Opinion by

Mb,. Justice Mestrezat,

The plaintiff by a contract in writing, dated April 24,1897, agreed “ to grade Grant street (cartway) from Academy Road to the New York Division of the Pennsylvania Railroad, the work of grading to include, without additional allowance or compensation, the construction of the necessary sewers and drains and two temporary wooden bridges over a branch of Poquessing creek; also remacadamizing and all other work incident to the grading in strict and exact accordance with the proposal and specifications hereto attached.” It was also stipulated that the contract was entered into under and subject to the provisions of the Act of June 1, 1885, P. L. 37, requiring all city contracts to be in writing, and that the total amount to be expended for the work to be done under the contract “ shall in no event exceed the sum of $21,000.” By a supplemental agreement this amount was increased to $23,400. The plaintiff did the work called for in the agreement, and -was paid by the city the full amount named in the agreement.

This is an action of assumpsit to recover $13,680.50, which the plaintiff alleges is due him for work done in constructing certain sewers and drains and remacadamizing, part of the work agreed to be done by him in his contract with the city to grade Grant street. He alleges that the bureau of highways sent out the specifications for the work to be done on Grant street which he received, but which did not include the work for which compensation is claimed in this suit; that subsequently and prior to letting the contract for the work they recalled these specifications from some of the parties to whom they had been sent, but not from him, and sent out other specifications containing a special notice requiring the additional work claimed for in this action; that he had no notice of the change in the specifications and his bid was based on the original specifications ; that after the contract had been awarded him he sent a letter to the director of public works advising him of his ignorance of the additional work required by the special notice at the time he bid, and that he would sign the contract under protest and complete the work and thereafter demand additional compensation for the work required by the special notice. The right of the plaintiff to recover in this action is set forth in the following averment of his statement: “ The said plaintiff avers that the defendant concurring with him agreed that for said work he was entitled to extra compensation, and accordingly by an ordinance approved December 31, 1898, which was passed by a two-thirds vote of each branch of councils did appropriate the sum aforesaid in the words following, that is to say: ‘ Item 27—To pay for sewers and drains built on the line of Grant street between the Philadelphia and Trenton Railroad and Academy Road—Thirteen thousand, six hundred and eighty dollars and fifty cents.’ ” The court below held that the plaintiff was not entitled to recover and entered a judgment against him from which this appeal was taken.

The facts of the case are not disputed. The plaintiff’s position is thus stated in his printed argument: “ The plaintiff relies upon the contract executed in accordance with the requirements of the act cited (June 1, 1885), and which includes the work performed. But he relies for additional compensation for such work upon the subsequent appropriating ordinance. . . . There is no dispute as to whether the work was done under contract; that is conceded. A contract for the work, therefore, is shown. The question now is whether the municipal legislature may appropriate extra compensation.”

There is but a single question involved in this appeal, and it is whether councils can by the ordinance presented as the basis of this claim bind the city to pay for work done in pursuance of a written contract for which the city has paid the price stipulated in the contract, To state the question would seem to be a full and complete answer to it against the contention of the plaintiff. We have time and again held, and it is therefore settled, that a strict adherence to the provisions" of the act of 1885 requiring contracts with the city to be in writing will be enforced, and that he who asserts and attempts to enforce any agreement or liability against the city must produce a duly executed contract in writing, signed by an officer authorized to make the same: Smart v. Philadelphia, 205 Pa. 329. The plaintiff relies upon the contract, but, as is apparent, it is only to the extent that it authorizes him to do the work. That far he recognizes its binding effect, but he seeks to evade its other stipulations which fixed the compensation he was to receive for performing the work. The contract in terms is made subject to the act of 1885, and provides specifically that the work to be done shall “ include without additional allowance or compensation the construction of the necessary sewers and drains.” It is, therefore, beyond any dispute that the work for which the plaintiff is seeking compensation in this suit was included in the work which he agreed to do in his written agreement for the compensation therein named and which he concedes he has received in full. This is a complete defense to this action, and the learned court was clearly right in directing judgment to be entered in favor of the city.

It is urged, however, on the part of the plaintiff that he was misled by the specifications furnished him by the city officials on which he tendered his bid which was accepted and on which the contract was awarded him. It is also claimed that he signed the contract under protest and agreed to complete the work that he might be eligible as a bidder for future work of the city. He alleges, and it is admitted, that he advised the director of public works of the change in the specifications and that he would claim additional compensation for the construction of the sewers and drains. It is upon these grounds, the plaintiff contends, that the councils were justified in passing the ordinance which he claims as a basis for a recovery in this action. But conceding these allegations to be true, he utterly fails to establish a valid claim against the city, or to show sufficient efficacy in the ordinance to sustain his demand. If the plaintiff was misled in bidding by the specifications furnished him by the city officials, it cannot affect his contract, as he admits that when he signed the agreement he knew its contents and that it included the work of constructing the sewers and drains. He, therefore, entered into the contract with full knowledge that it required him without additional compensation to do the work for which he seeks remuneration here. Nor can his protest avail him. He was not compelled to sign the contract. When he discovered that, as he alleges, the rate at which he bid would not justify him in doing the additional work required by the special notice, he should have declined to enter into the contract and to assume the obligations it imposed. The ostensible fear that if he pursued this rational course he would be branded as a defaulting bidder by the city officials will not relieve him from his contract, executed voluntarily and with a full knowledge of it contents.

The ordinance declared upon will not support the action. It appropriates money to the department of public works to pay for the construction of the sewers and drains on Grant street. But before any person can sustain a claim against the city for compensation for the work he must, as we harm seen, show that it is due him by a contract in writing, signed by the proper city officer. Until the plaintiff presents a demand showing a liability on the part of the city imposed by a written contract, he cannot enforce payment of his claim against money appropriated by the ordinance in question to the department of public works. If councils may by an ordinance of this character impose a liability on the city for claims for grading streets and constructing sewers and drains without a contract executed in accordance with the act of 1885, the statute is rendered nugatory and its purpose, the protection of the city, is completely frustrated. It is not pretended that this claim for “ extra compensation ” is for work done in pursuance of a written agreement other than that of 1897, and the plaintiff having received the compensation stipulated in that contract for the performance of this work, his claim in this action is not supported by a contract in writing and, hence, the money appropriated by the ordinance in question cannot be made available in satisfaction of it.

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

Mb. Chief Justice Mitchell,

dissenting:

The plaintiff’s is admittedly a just claim for work which was done by him but which through no fault of his, was not included in his written contract. If the defendant were a private party it is conceded that there would be no defense, but defense is made here altogether on technicalities. If the city is really without power to pay its honest debts the result must be acquiesced in, however discreditable. If the act of 1885 alone is looked at there is basis for argument to that effect. The act of 1885, however, is intended to make provision for ordinary contracts in the current business of the city, and these it requires to be executed in the prescribed forms. But the Act of May 28, 1874, P. L. 230, in section 5, provides for this very kind of case by authorizing ordinances to pay contractors extra compensation after the services have been rendered or the contracts made, provided such ordinances are passed by a twothii’ds vote and approved by the mayor. Councils desiring to be honest passed an ordinance making an appropriation for plaintiff’s claim. It was passed by the requisite two-thirds vote and was approved by the mayor.

Two objections are made to the application of this ordinance, first, that it does not name the plaintiff. This is true, but it specifically appropriates the exact sum due him “ to pay for sewers and drains built on the line of Grant street,” etc., describing the work in terms that include the plaintiff and exclude all others. There is not the slightest room for doubt that the plaintiff was intended, and the referee so found as a fact, which has not been excepted to.

The second objection is that in December, 1899, councils by ordinances transferred the sum previously appropriated for this work, to other uses. This so far as shown by the evidence was done in the ordinary course of legislation at the end of the year. The appropriations for the multifold requirements of the city being made in advance upon estimates, some naturally fall short while others leave a surplus. At the end of the year it is customary to transfer the surplus balances to cover the deficits and thus bring the totals of appropriations and expenditures into harmony. A transfer of this kind is not a repeal of the appropriation though it does remove the money from its place on the department books, so that it is no longer available for payment in the ordinary way by warrant drawn on the treasurer. But the promise to pay implied in the appropriation still remains, and is the sufficient foundation for an action of assumpsit. Both objections to the ordinance for paying appellant are technicalities of the narrowest kind, are unsound in principle and have no claim to be favored. Courts are not required to be astute to enable even cities to evade payment of their honest debts. I would reverse this judgment and enter judgment for the appellant, on the award of the referee.


author: Mb.. Chief Justice Mitchell,

text:
    Commonwealth ex rel. Curran, Appellant, v. Philadelphia.

      Municipal contracts•—Contracts—Retained percentage—Discretion of Director of Public Works—Mandamus.

    The ten per cent deposit by a contractor with the city of Philadelphia, under the ordinance of December 24, 1881, is not merely to furnish a quick and convenient special remedy, but is an additional and cumulative security for the performance of the whole contract; and this being so the question of satisfactory performance is one involving the discretion of the director of public works, and therefore mandamus will not lie to secure a return of it.
    Argued Jan. 17, 1905.
    Appeal, No. 150, Jan. T., 1904, by plaintiff, from order of C. P. No. 5, Phila. Co., Dec. T., 1903, No. 2835, refusing peremptory mandamus in case of Commonwealth ex rel. James Curran v. City of Philadelphia, Peter E. Costello, Director of the Department of Public Works and Henry R. Shoch, City Treasurer.
    Before Mitchell, C. J., Dean, Fell, Brown, Mestrezat, Potter and Elkin, JJ.
    Affirmed.
    Petition for mandamus by a contractor to secure a return of a ten per cent deposit on a municipal contract. Before Martin, P. J. ^
    The opinion of the Supreme Court sets forth the material portions of all the papers relating to the case. In addition to the facts stated in the opinion, it appeared that on January 2, 1904, the petitioner requested the director of the department of public works to deliver to him an order on the city treasurer, to enable him to obtain the return of the ten per cent which he had deposited in accordance with the terms of the ordinance and contract. The director refused to deliver the order. A petition was filed setting forth the facts and praying for an alternative mandamus requiring the execution and delivery of the order by the director and payment by the city treasurer to the petitioner of this sum of $17,200. An alternative writ having been allowed and duly served, a return thereto was made in which it was averred that the contract was not fulfilled or performed to the satisfaction of the director of the department of public works, and that default was made and the work neglected and imperfectly performed; that streets were not adequately or properly kept clean; and that in addition to the specific neglect, omissions and defects, for which fines and penalties were imposed in accordance with the specifications, default was made in the performance of the contract, and the streets were not properly cleaned as stipulated by its terms. The relator filed a demurrer, alleging the return was defective, both in form and substance.
    The court overruled the demurrer and made an order refusing the mandamus.

      Alex. Simpson, Jr., with him Samuel Goodman, Jr., and William Findley Brown, for appellant.
    Each month the director passed upon the question of deductions and made an award of the balance due, and warrants were drawn and delivered to the relator therefor. By making these twelve awards he exhausted his power to make deductions and he cannot now alter his conclusions to conform to his changed views if he has any: Klingensmith v. West Leechburg Steel, etc., Co., 17 Pa. Superior Ct. 210 ; Hartley v. Henderson, 189 Pa. 277 ; Harlow v. Homestead Borough, 194 Pa. 57; Phila. v. Bickley, 2 Sadler (Pa.), 214.
    Mandamus will lie to compel the director to execute and deliver an order upon the city treasurer for the surrender of the ten per cent deposit: People ex rel. v. Board of Police, 75 N. Y. 38 ; Board of Directors v. Arnold, 60 Ill. App. 328 ; Apgar v. School Trustees, 34 N. J. L. 308; Raisch v. Board of Education, 81 Cal. 542 (22 Pac. Repr. 890) ; Swift v. New York, 83 N. Y. 528 ; Portland Stone Ware Co. v. Taylor, 17 R. I. 33 (19 Atl. Repr. 1086) ; Missouri ex rel. v. The Justices, 48 Mo. 475 ; Hospital v. Higgins, 15 Ill. 185 ; Com. ex rel. v. Select & Common Councils of Pittsburg, 34 Pa. 496; McManus v. School Controllers, 7 Phila. 23 ; Osborn v. Selectmen of Lenox, 84 Mass. 207; Roberts v. United States, 176 U. S. 221 (20 Sup. Ct. Repr. 376) ; Com. ex rel. v. Commissioners, 32 Pa. 218; Com. ex rel. v. Phila., 176 Pa. 588; Com. ex rel. v. Jones, 192 Pa. 472.

      JErnest Lowengrund, assistant city solicitor, with him John L. Kinsey, city solicitor, for appellees.
    Mandamus will not lie: Ackerman v. Buchman, 109 Pa. 254; Welchans v. Shirk, 98 Pa. 17; Miller v. Canal Commissioners, 21 Pa. 23; Lansdowne Boro. v. Upper Darby Twp., 9 Pa. Dist. Rep. 694; Com. v. Rosseter, 2 Binney, 360 ; Com. v. Cochran, 5 Binney, 87 ; Ins. Co. v. Com., 92 Pa. 72; Com. v. Thomas, 163 Pa. 446; Heffner v. Com., 28 Pa. 108; Com. v. Commissioners, 16 S. & R. 317; Com. v. Mitchell, 2 P. & W. 517; Hester’s Case, 2 W. & S. 416 ; Bank v. Ziegler, 11 Pa. Dist. Rep. 771.
    Where a contract is to be performed to the satisfaction of one of the parties, it must be alleged and proven that he was actually satisfied, unless his dissatisfaction be the result of mere caprice or fraud: Seeley v. Welles, 120 Pa. 69; Singerly v. Thayer, 108 Pa. 291; Howard v. Smedley, 140 Pa. 81; Hostetter v. Pittsburg, 107 Pa. 419.
    Parties may provide for as many different securities for the same obligation as may be agreed upon, and it is open to the holder thereof to pursue any or all of them at his option: Jennings v. Loeffler, 184 Pa. 318.
    March 6, 1905 :
   Opinion by

Mb.. Chief Justice Mitchell,

The relator, Curran, entered into a contract with the city of Philadelphia to clean certain streets during the year 1903 for the sum of $172,000 and in compliance with the requirements of his contract and the ordinance of December 24, 1881, he deposited ten per cent of the contract amount, to wit: $17,200, in cash with the city treasurer. He also gave bond with security under other ordinances for the performance of his contract. At the close of the year 1903 he demanded of the director of public works an order on the city treasurer for the return of his deposit of 117,200, and this being refused he brought this suit.

The first question is whether mandamus will lie. That depends on the terms of the deposit, and the nature of the duty to return it. The claim of appellant is that the deposit is not a general security for due performance of the contract, that being provided by the bond with surety, but is a special and limited security to enable the director of public works to have done promptly any work which the contractor has neglected and to pay for the same by drawing on such special fund. At the end of the year if the fund has not been drawn upon for that purpose the contention is that the function of the fund has ended and the duty of returning it is absolute and ministerial, and the facts not being disputed the duty may therefore be enforced by mandamus.

In support of this view it is urged that the general regulations for proposals subject to which the contract was made, provided inter alia that:

“ 1. Contractors shall, within ten days after the award of the contract, deposit with the city treasurer ten per cent of the amount of each contract awarded, in cash, and also enter into bond, as provided by ordinance, to be approved by the city solicitor, in one half the amount of such contract. A penal bond in proportionate amount of contract is also required.” And further:

“9. Failure to comply with any part of the contract, or of these specifications shall be cause for the director of the department of public works, without notice to the contractor, to employ sufficient force to have the work contracted for properly done, and to pay for the same out of the fund deposited as a security by the contractor.”

The contract itself provides, “ And if, upon the 31st day of December 1903, the said contract be completed to the satisfaction of the said director, then the said party of the second part shall be given an order upon the said city treasurer for the surrender of the ten per centum deposited as a guarantee for the faithful performance of the same.”

Then as bearing on the general security for performance it is pointed out that the contractor gave a bond with surety in the sum of $86,000, which is available to secure the city for any loss by the contractor’s default; and the city has further protected itself by the terms and mode of payment for the work admittedly done. By the contract it was provided that “ Payments will be made in equal monthly installments, except for the months of January, February and March. During the said months, one half the regular monthly installments shall be paid, less deductions for noncompliance with this contract, and if on or before the first day of April, the whole district shall be cleaned to the satisfaction of the said director, then any balance of the amount so retained shall be paid to the said party of the second part. Should the streets not be so cleaned by the said first day of April, then the amount retained shall remain the property of the said city of Philadelphia.” The contract further gave the director of public works final and exclusive authority to make such deductions for noncompliance, and the relator’s petition avers and the director’s answer does not deny that the director did in fact make deductions from month to month, thus leaving in the city treasury a large part of the contract price, besides the cash deposit of $17,200 none of which had been used to pay for work done by order of the director to make good the contractor’s default.

If the contention of appellant, thus set forth, is sound, that the deposit was not a part of the general security for the city but an additional special and limited security only to furnish an available fund to enable the city'to have omitted work done promptly, and the contract time having expired without any of it being so used, then it is quite clear that the purpose of the deposit was ended, and the duty to return it was absolute and ministerial. In such case mandamus to the official would lie.

On the parts of the contract thus far mentioned, appellant’s case makes a strong presentation. But other parts do not look the same way, especially when viewed in connection with the acts of the parties. Thus when appellant paid in the deposit to the city treasurer, he accepted a receipt for it in the following form, “ said amount being deposited with the city treasurer as a guarantee of the performance of the said contract and with this distinct understanding and agreement, to wit: That if said James Curran shall fail to comply with all the terms of said contract, and to do all work coining within the limits of the specifications thereto attached, and the director of the department of public, works shall do such neglected work, then the said director may charge the expense thereof, and the penalty incurred by such noncompliance against said James Curran, and may draw from the city treasurer to an amount not exceeding the ten per centum as herein set forth. Should the said contract be completed to the satisfaction of the said director, the said ten per centum, or any part thereof remaining, shall be surrendered to the said James Curran.”

Further, the contract itself as already quoted provides that the order for the surrender of the ten per centum deposited as a guarantee for the faithful performance of the same shall be given if “the said contract ” shall be completed “ to the satisfaction of the director.”

Both parties thus seem to have assumed at the time that the satisfaction of the director with the completion of the whole contract was a factor in regard to the return of this deposit as well as in regard to the general security under the bonds. And when we turn to the ordinance requiring the deposit, we find that that is apparently the intent of the requirement. Its language is “ cotemporaneous with the execution of the contract, 10 per cent of the amount of the contract shall be deposited with the treasurer to secure the fulfillment of said contract, said deposit to be returned at the end of the contract if there be no default.”. As this is the law under which the contract was entered into, and everything in connection with it was done, its provisions are decisive and must govern the interpretation.

We are brought, therefore, to the conclusion that the ten per cent deposit was not merely to furnish a quick and convenient special remedy, but was an additional and cumulative security for the performance of the whole contract. This being so the question of satisfactory performance is one involving the discretion of the director of public works and, therefore, mandamus will not lie.

Judgment affirmed.


author: Per Curiam,

text:
    Gaffney, Appellant, v. Union Traction Company.

      Negligence—Railways—Riding on platform—Getting off car.

    Riding on the platform of a street car, when there is available room inside the car is negligence in itself as a matter of law.
    Where a person riding on the back platform of a street car gets down on the step while the car is still in motion, and is thrown off by a sudden jerlc of the car and injured, he is precluded by his own contributory negligence from recovering damages from the railway company.
    Argued Jan. 18, 1905.
    Appeal, No. 87, Jan. T., 1904, by plaintiff, from order of C. P. No. 3, Phila. Co., March T., 1902, No. 917, refusing to take off nonsuit in case of Thomas Gaffney v. Union Traction Company.
    Before Mitchell, C. J., Dean, Fell, Brown, Mestrezat, Potter and Elkin, JJ.
    Affirmed.
    Trespass to recover damages for personal injuries. Before McMichael, J.
    At the trial it appeared that on February 12,1902, plaintiff boarded a car on Chelton avenue in the city of Philadelphia, and rode on the back platform, although there was room inside the car. As the car approached Devon street, the plaintiff stepped down on the lower step of the ear and was thrown off by a sudden jerk.
    The court entered a compulsory nonsuit which it subsequently refused to take off.

      Error assigned was refusal to take off nonsuit.

      Myles Higgins, of Higgins Higgins, for appellant.

      Thomas Learning, with him Thad. L. Vanderslice, for appellee.
    March 6, 1905 :
   Per Curiam,

How far a passenger on a street car may carry his preparation to alight when the car is approaching his destination depends so entirely on the exact circumstances that a discussion would be useless in a case like the present, where the facts put the plaintiff outside of any possible rule of justification. He was riding on the back platform, though his own testimony-shows that there was available room inside. This in itself was negligence as a matter of law : Thane v. Scranton Traction Co., 191 Pa. 249.

But further, as the car was approaching his destination and he had told the conductor to stop, he voluntarily put himself in a place of much greater danger by getting down on the step while the car was still in motion and he was thrown off as he said by a sudden jerk. There was really no sufficient evidence that the jerk of the car was due to negligence of the company, but even if it had been plaintiff’s own negligence would have barred his recovery: Bainbridge v. Traction Co., 206 Pa. 71.

Judgment affirmed.