text:
    McClure’s Estate.

      Will — Construction—Power of appointment — Vested and contingent estates.

    ■ Testatrix by her will gave to her nephew her own estate if he should be living at the time of her death, and also an interest in the estate of her mother over which she had power of appointment “if he should be living at the time of my decease.” By a subsequent clause she provided that "in case my nephew shall die prior to my own decease, or in case he shall die before my estate is fully settled up by my executor, and before the proceeds of my said estate shall have been paid over to my nephew as herein provided then and in that case I do direct that all of my estate together with all interest in and a right to devise will, 'or give the same arising in or to the will of my mother which shall then remain in the custody of my executor, and which has been herein bequeathed to my nephew, shall be given, devised and bequeathed, and by my executor paid over to my six first cousins,” naming them. The nephew die.d within a few months after his aunt’s death, without having received anything under the latter!s will. Held, that no estate vested in the nephew, and that the six cousin's were entitled both to the estate of the testatrix, and to the interest in her mother’s estate over which she had power of appointment..
    Argued May 11, 1908.
    Appeal, No. 284, Jan. T., 1907, by Nina M. Hall, Administrator o. t. a., of the estate of Humes Hall, deceased, from decree of O. C. Union Co., May T., 1904, No. 12, sustaining exceptions to auditor’s report in Estate of Elizabeth H. McClure, deceased.
    Before Fell, Brown, Mestrezat, Potter and Elkin, JJ.
    Affirmed.
    Exceptions to report of Philip B. Linn, Esq., auditor.
    Auten, J., specially presiding, filed the following opinion :
    After making a number of specific bequests the will of Elizabeth H. McClure, deceased, provides: “ As to the rest, residue and remainder of my estate, whether real, personal or mixed, including and intended to include all monej's, rights and credits, or the proceeds thereof, shall be invested by my executrix hereinafter named for the sole use and benefit of my said daughter, Caroline H. McClure, during the term of her natural life, so that she, my said daughter, shall receive the full annual interest, proceeds or income arising therefrom, and also so much of the said principal sum as may be necessary or requisite to maintain her, my said daughter, in as comfortable a manner and style as she has been accustomed to live in during my life. And further, I do direct that my said daughter, Caroline H., shall have full power to dispose of by will, by gift, or in any other way of the one-half of such moneys, credits, or rights or such investments into which they may have been converted at the time of her death or prior thereto.”
    The testatrix died April 17,1892, and her will was duly probated May 20,1892, letters testamentary thereon being granted to her daughter, the said Caroline H. McClure, executrix therein named. At the date of her death, the residuary estate of the testatrix consisted of a single item, a bond dated October 11, 1878, drawn by E. C. Humes, conditioned for the payment of 110,850.66, upon which there was due April 17, 1892, including interest, the sum of $11,170.76.
    Accountant contends that under the terms of the clause of the will quoted, Caroline H. McClure took an absolute estate in the one-half of the residuary of the estate of Elizabeth H. McClure, deceased. The auditor, however, has found that “ Caroline H. McClure, by the terms of the will of Elizabeth H. McClure, as executrix thereof, took an estate for life in the whole of the ‘rest, residue and remainder’ of her mother’s estate, with the right to receive so much of the said principal sum as may be necessary or requisite to maintain her in as comfortable a manner and style as she had been accustomed to live in; with the further right or power to dispose of by will, or by gift or in any other way of the one-half of such money, credits, or rights or such investments into which they may have been converted at the time of her death or prior thereto.” In other words, as we understand the auditor, he has found that Caroline H. McClure took an estate for life in entire residuary of her mother’s estate, with the power of the consumption and power of appointment over one-half of said “ rest, residue and remainder.” In this conclusion we entirely concur, and are of opinion that the authority of Tyson’s Estate, 191 Pa. 218, fully justifies this finding.
    Caroline H. McClure died October 24, 1904, testate; her will, bearing date September 1, 1904, was duly probated October 27, 1904, and letters testamentary were granted to Hamilton B. Humes, the executor therein named, who is also the present accountant.
    By her will it is, inter alia, thus provided : “ Eifth :■ — I do direct that my executor hereinafter named shall sell all of my real estate at either public or private sale, either as a whole or in parts as in his judgment and discretion shall be for the best interests of my estate. In order that my said real estate shall not be hurriedly or hastily sold or offered for sale, I do hereby direct that my said executor shall not be required to close up or make an accounting upon my estate for the term of five (5) years from the time of my decease, and to this end and for this purpose I do direct that my said executor shall not be required to sell my real estate prior to a period of four (4) years and six (6) months after my decease if, in his judgment and the exercise of his discretion, it may appear for the best interests of my estate to thus postpone the final settlement thereof and for the due and proper conveyance of my real estate to the purchaser and purchasers thereof, I do hereby authorize and empower my executor to make, execute and deliver to the purchaser or purchasers of said real estate good and sufficient deed or deeds therefor in fee simple.
    “ Sixth : — I do direct that all of my notes, bonds, stocks, mortgages, and other evidences of money due or belonging to me be disposed of or collected by my said executor and the same converted into money by him at such time or times as he may deem for the best interest of my estate within the period above mentioned and the proceeds of the same together with the net proceeds of my real estate after the payment by my executor of all debts, expenses, charges and commissions together with all collateral inheritance and other taxes, being first deducted therefrom to be paid over to my nephew Humes Hall if he shall be living at the time of my decease subject to all of the provisions and conditions of this my Last Will and Testament.

      “ Seventh: — I do give, devise and bequeath unto my nephew, Humes Hall, if he be living at the time of my decease, all of the interest in the estate of my mother, Elizabeth H. McClure, deceased, devised and bequeathed to me with power in me to dispose of the same either by will or gift, being one-half of the residuary of my said mother, Elizabeth H. McClure.
    “ Item : — I do further direct that in case my nephew Humes Hall shall die prior to my own decease or in case he shall die before my estate is fully settled up by my executor hereinafter named and before the proceeds of my said estate shall have been paid over to my nephew Humes Hall, as herein provided, then and in that case I do direct that all of my estate together with all interest in and the right to devise, give or will the same arising in and through the will of my mother, Elizabeth H.' McClure, deceased, which shall then remain in the custody of my executor and which has has been herein bequeathed and devised to my nephew Humes Hall shall be given, devised and bequeathed and by my executors paid over to my six first cousins, namely : — William P. Humes, Mira Humes, Maria Humes Roberts, Caroline Humes G-ilmore, Rachel Humes Allison and Hamilton B. Humes, share and share alike, to them, their heirs and assigns forever.”
    Thus it appears that Caroline H. McClure exercised the power of appointment conferred upon her under the terms of the will of Elizabeth H. McClure,, deceased. • The auditor has found that “by the provision of the will of Elizabeth Ii. McClure, and the exercise of the power of appointment in the will of Caroline H. McClure immediately upon the death of the latter, Humes Hall took a vested estate in all of the estate or interest iu the estate of Elizabeth H¡ McClure, deceased, over which Caroline McClure had the power of disposition or appointment, either by will, gift or otherwise, being the one-half of the residuary of the estate of Elizabeth H. McClure; and this estate was not divested.”
    To our mind this finding raises the most important point for determination, and to it the learned auditor has given careful consideration, and has cited a number of authorities to sustain his position. However, apart from the enunciation of rules of construction, precedents are of little value in contests of this kind.
    Mr. Justice Sharswood says in Provenchere’s Appeal, 67 Pa. 463 : “ There are no arbitrary or unbending rules in the construction of the words of a will. No two wills are in all respects alike. Where indeed the same precise form of expression occurs as may have been the subject of some former adjudication, unaffected by any indication of a different intention in other parts of the instrument, the courts, with a view to certainty and stability of titles, will follow the precedent. Counsel can thus be enabled to advise with confidence. Nevertheless, the oardinál canon still holds good, that the intention of the testator of each will separately is to be gathered from its own four corners. Hence almost every general rule has its recognized special exceptions, with exceptions to such exceptions which bring us back to the general rulé again, and this may be and sometimes has been carried even furthei in the vain attempt to generalize and classify all the decisions upon this most difficult and doubtful subject — the ascertainment of the intention from the words of a man, who in many cases had no intention at all, the question not being present in his mind at the time the words were used. These remarks are particularly applicable to the controversies which have arisen as to whether future legacies give present vested or contingent interests.”

      In ascertaining whether or not a legacy is contingent or vested, and if vested, whether it was subsequently divested, the cardinal rule is that the intention of the testator must govern, if legal, and that this intention must be gathered from the four corners of the will. This rule is familiar; the difficulty arises in its" application. In order to give proper effect to the will of Caroline H. McClure we are to endeavor to ascertain her real intentions from the words of the instrument, and not blindly follow precedents, which at best give but a dim side light upon the question. And in trying to discover what she really means from the language she employs, it might be well to consider her will in the light of an ordinary letter or other written communication. What does she say ? She directs that, in order that her real estate shall not be hurriedly or hastily sold or offered for sale, her executor shall not be required to close up or make an accounting upon her estate for the term of five years after her decease and that to this end he shall not be required to sell her real estate prior to a period of four years and six months after her death; that he shall dispose of or collect and convert into money her notes, bonds, mortgages, etc., at such time or times as he may deem to the best interests of her estate, within the period above mentioned, and pay the proceeds of the same and the net proceeds of all her real estate over to her nephew, Humes Hall, “ If he shall be living at the time of my decease, subject to all the provisions and conditions of this, my last will and testament.” She further writes that she bequeaths to her nephew, Humes Hall, that part of the estate of her mother, Elizabeth H. McClure, deceased, over which she had the power of appointment, if he be living at the time of her decease. If Humes Hall had been living at the date of the settlement of Caroline H. McClure’s estate, the question we are now discussing could not have arisen. He died, however, about four months subsequent to the date of the death of Caroline H. McClure and before her estate was settled.
    In a subsequent item of the will she writes that in case Humes Hall should die prior to her own decease, or in case he should die before her estate was fully settled up by her executor, and before the proceeds of her estate were paid over to Humes Hall, then all of her estate, together with all the interest in the estate of her mother, Elizabeth H. McClure, over which she had a power of appointment, should go to her six first cousins above named. In effect she says to her executor : “ If Humes Hall shall be living when my estate shall have been settled up, he shall receive from my own estate the legacy contained in clause six of my will and also the residuary part of my mother’s estate over which I have a power of appointment, as declared in the seventh clause; you shall have five years in which to settle my estate and make an account thereof, and if Humes Hall shall not be living at the accomplishment of that event within the time prescribed, he shall not be entitled to anything which I have bequeathed to him in the sixth and seventh clauses, but you shall pay the same to my six first cousins.” It seems to us that her language is plain and is susceptible of only one meaning : that’it is only when we place a strained construction upon her words as the result of an effort to apply precedents we can arrive at any other conclusion. In Wengerd’s Estate, 143 Pa. 615, the Supreme Court say, “The doctrine of this state, from the time of Corbin v. Wilson, 2 Ash. 178, has uniformly been that a bequest of personal property relates to the time of the testator’s death, unless a contrary intent is clearly indicated in the will. ‘ If any immediate legacy is given without specifying a time for payment, and is given over in case the legatee dies before it becomes payable, the word, payable,' can only have reference to the death of the testator.’ ” Caroline IT. McClure fixes a definite, determinate period at which Humes Hall shall receive her bounty, provided he be then living. This she had an absolute right to do under the power of appointment conferred by her mother. We have no right to impute to her an intention contrary to the one expressed in plain and unequivocal language. With the wisdom or unwisdom of the provisions of her will, we have nothing to do. We are not permitted to make a will for her nor to depart one iota from her plainly declared intentions. In support of his finding, the auditor relies largely upon Muller’s Estate, 19 W. N. C. 320, and Wengerd’s Estate, supra. In Muller’s Estate, however, the legacy was payable immediately upon the death of the testator, and in Wengerd’s Estate the provision was that, “In case of the death of any of said children of my son David before the payment to them of their said shares, then to be divided between the survivors.” That was a case of an immediate legacy being given without a specific time for payment. Both of these cases, therefore, differ materially from the one now under consideration. Caroline H. McClure has stated a fixed time for payment, to wit: when her estate shall have been fully settled.
    Stress is laid upon the fact that Caroline H. McClure had no debts and that the accountant, being one of the six first cousins named, profits in the event of this legacy not going to Humes Hall. It will be recollected, however, that Caroline H. McClure had an undivided interest, at least, in real estate and that she for reasons expressed in her will, specified a time within which the executor was not obliged to sell her real estate. Surely, therefore, the accountant cannot be charged with delay to the disadvantage of Humes Hall, when the death of the latter followed so soon that of Caroline H. McClure.
    In Raleigh’s Estate, 206 Pa. 451, the testator was largely indebted ; his will provided that, “ upon the death of my wife, my executors shall divide my entire estate into as many equal portions as I shall have children living or that should be represented by lawful heirs, and make a plain and clear statement of the division, describing the properties and numbering each lot or share, and have them of as near equal value as possible, then make the distribution,” etc. He died January 10, 1882. The debts were fully paid October 1, 1900 ; James Raleigh, a son, died September 26, 1896, leaving a widow and one child. The Supreme Court says : “ In the present case there was no gift of any part of the testator’s estate (except legacies of $100 a month to his widow and $25.00 a month to each of his children), ‘ until all my debts shall be paid and business settled up, ’ or as he puts it again, ‘ after my business is closed up and all my debts paid.’ The earliest point of time, therefore, at which it could possibly be held that the legacy to James Raleigh of a distributive share in the estate could take effect, would be the date of the final closing of business and payment of testator’s debts. This date was October 1, 1900. But James Raleigh died September 26, 1896, long before that date. Therefore, no interest in the share of the estate bequeathed to him ever became vested in him.” The language here used to fix a time for the payment of the legacy to James Raleigh is no more definite or precise than that employed by Caroline II. McClure. As said by Judge Ashman in the Shelmerdine’s Estate, 16 Pa. Disk Rep. 222: “The law favors vested interests, but the tendency of modern cases is to escape from purely technical rules of construction in furtherance of vesting, which as often as not defeat the actual intention of a testator.” It should be remembered, too, that Humes Hall was the nephew of Caroline H. McClure, and, therefore the presumption that the legacy was intended to be vested, applies with far less force than would one given to a child or grandchild, by a testator.
    We are of opinion that the legacies devised to Humes Hall under the seventh clause of the will of Caroline H. McClure, deceased, should go to the six first cousins, William P. Humes, Mira Humes, Maria Humes Roberts, Caroline Humes Gilmore, Rachel Humes Allison and Hamilton B. Humes, under the subsequent “ Item ” of her will, and that the same should be awarded to them in the distribution of the estate of Elizabeth H. McClure, deceased, the power to make such distribution being fully justified by the authorities cited on that point by the learned auditor.
    If we are wrong in our view as to the proper legatees, then the “ Item ” following the seventh clause of Caroline II. McClure’s will was wholly unnecessary as well as meaningless, and its presence can only be accounted for on the theory expressed by Mr. Justice Sharswood in Provenchere’s Appeal, 67 Pa. 463, that it is a case where the testatrix had no intention at all.
    All exceptions not sustained by this opinion are dismissed.
    The report is referred back to the auditor with direction to award distribution in accordance with this opinion.

      Error assigned was in sustaining exceptions to auditor’s report.

      John G. Johnson and William B. Foilmen, with them T. K. Yam, Dyke, for appellants.
    Time was not annexed to the legacy and therefore Humes Hall took a vested estate in that interest in the estate of Elizabeth II. McClure. If there was any postponement, it was Attached to the time of payment and not to the person of the legatee, and where the bequest is immediate and payment postponed the legacy is vested. The gift of the legacy was independent of the direction in regard to the time of payment to the legatee, and for that reason it is apparent that the testator intended that the legacjr should vest. If the gift had been conditioned upon the legatee’s reaching a given age, it would have been contingent: Cooper v. Scott, 62 Pa. 139; Little’s App., 117 Pa. 14; Moore v. Smith, 9 Watts, 403 ; Snyder’s Est., 180 Pa. 70; Bowman’s App., 34 Pa. 19; Wengerd’s Est., 143 Pa. 615; Sheetz’s App., 82 Pa. 213; Phillips’s Est., 205 Pa. 504; Newbold v. Boone, 52 Pa. 167; Mutter’s Est., 38 Pa. 314.
    May 25, 1908:

      John O. Beading, with him Alfred Hayes, for appellees.
   Opinion by

Mr. Justice Mestrezat,

We need not determine whether Caroline McClure took an absolute estate or a life estate with a general power of appointment in the one-half of the residuary estate of Elizabeth ET. McClure which is the subject of this controversy. If, as the court below held, Caroline EL McClure took an estate for life with the power of consumption and power of appointment over the one-half of the residue of her mother’s estate, that one-half of the estate, by virtue of the exercise of the power of appointment, became vested in and was distributable to the six first cousins of Caroline EL McClure, and was properly awarded to them by the court below. The learned judge has fully vindicated his conclusions in the opinion disposing of the exceptions filed to the report of the auditor.

As in the interpretation of all wills, the intention of the testator in this case must be ascertained from the entire instrument, and when ascertained must be carried into effect. No canons of interpretation need be invoked here to determine the intention of the testatrix. The intention of Caroline EL McClure in disposing of the interest or estate given her by her mother and over which this controversy arises is perfectly clear from the language she has used.

Elizabeth EL McClure, by her will, directed that the proceeds of the residue of her estate should be invested by her executrix for the sole use and benefit of her daughter, Caroline H. McClure, during the latter’s lifetime, so that her daughter should receive the annual interest arising therefrom and also so much of the principal as might be necessary or requisite to maintain her daughter, and then provided as follows : “ And further I do direct that my said daughter, Caroline H., shall have full power to dispose of by will — by gift or in any other way of the one-half of such moneys, credits or rights or such investments into which they may have been converted at the time of her death or prior thereto.” The remaining one-half of her residuary estate she directed to be divided among her grandchildren. Caroline H. McClure was appointed executrix of her mother’s estate. At the date of the death of Elizabeth H. McClure, her residuary estate consisted of a single item, a bond conditioned for the payment of $10,850.56. One-half of that sum is the money now in controversy. Caroline H. McClure is dead, and by her will, disposed of the estate given her by her mother. In the sixth clause of her will she directs that the proceeds of her notes, etc., after the payment of her debts, collateral inheritance and other taxes; shall “ be paid over to my nephew Humes Hall if he shall be living at the time of my decease subject to all of the provisions and conditions of this my last will and testament.” In the seventh clause of the will she gives to her nephew, Humes Hall, “ if he be living at the time of my decease, all of the interest in the estate of my mother Elizabeth H. McClure, deceased, devised and bequeathed to me with power in me to dispose of the same, either by will or gift, being the one-half of the residuary of my said mother Elizabeth H. McClure.” Immediately following the seventh clause of the will, she provides in a clause she designates “ Item ” that in case my nephew Humes Hall shall die prior to my own decease or in case he shall die before my estate is fully settled up by my executor hereinafter named and before the proceeds of my said estate shall have been paid over to my nephew Humes Hall as herein provided then and in that case I do direct that all of my estate together with all interest in and a right to devise will or give the same arising in or through the will of my mother Elizabeth H. McClure deceased which shall then remain in the custody of my executor and which has been herein bequeathed and devised to my nephew Humes Hall shall be given, devised, and bequeathed and by my executor paid over to my six first cousins,” (naming them).

In ascertaining the intention of Caroline H. McClure as to the disposition of the estate which she received from her mother, her whole will must be considered. In the sixth clause it will be observed that the proceeds of her notes, etc., go to her nephew Humes Hall if he be living at the time of the testatrix’s decease, “ subject to all of the provisions and conditions of this my last will and testament.” In the following, or seventh, clause the estate she had received from her mother was given to the same nephew “ if he be living at the time of my decease.” Both of these clauses, however, are followed by “ Item,” which is subsequent to and controls both of the clauses immediately preceding it. In “ Item,” the testatrix changes the time of the vesting in her nephew of both her own estate and the estate she received from her mother. By clauses six and seven of her will Humes Hall is to have the estate she owned in her own right' and the estate she received from her mother with power of appointment, if he be living at the death of the testatrix. By “ Item,” however, the estates given him immediately preceding did not vest in him if he died prior to the decease of the testatrix, or before her estate was fully settled up by the executor and the proceeds had been paid to him. Humes Hall died within a few months' after Caroline H. McClure’s death, without having received anything under the latter’s will. This provision of the will was not simply a postponement of the payment of the proceeds of Caroline H. McClure’s estate or of the estate she had received from her mother, but it was a postponement of the vesting of both estates. In other words, in the language of the cases, the time of enjoyment by the legatee of the bequest was annexed to the gift and not to the payment of it. Humes Hall took no interest or estate under the will of Caroline H. McClure unless he was living when the estate was “fully settled up” by the executor and the proceeds were paid over. If the executor had paid over any part of the estate to Humes Hall prior to the time it was “ fully settled up,” it would not have been a good payment, and the executor would have been subject to a surcharge at the instance of the six first cousins. Of this we think there can be no doubt. If the language of the will is to have its ordinary meaning, the date of the vesting of the estate in Humes Hall is left in no doubt, and any payment of any part of the estate to him prior to the date of its vesting would have been wholly unauthorized and a devisavit for which the executor would have been responsible.

There is no merit in the suggestion or argument that “ Item ” does not cover or include that part of Caroline McClure’s estate which she received from her mother. It includes both her own estate and the estate she received from her mother, and over which she was given a general power of appointment. In case her nephew Humes Hall died prior to the settlement of the estate it is then provided in “ Item ” that “ All of my estate together with all interest in and the right to devise will or give the same arising in or through the will of my mother Elizabeth H. McClure deceased which shall then remain in the custody of my executor and which has been herein bequeathed and devised to my nephew Humes Hall shall be given devised and bequeathed,” etc. It will thus be observed that there is no foundation whatever for the contention that this clause of the will did not dispose of the estate which Caroline H. McClure received from her mother. It does so in terms, and is clearly an exercise of the power conferred upon the testatrix by her mother.

The learned judge of the orphans’ court has so fully discussed this branch of the case that nothing more need be said here. The other assignments are without merit.

The decree is affirmed.


source: Caselaw Access Project

author: Per Curiam,

license: Public Domain

text:
    McGraw, Appellant, v. Hilton.

      Arbitration — Reference—Finding of fact — Partnership.
    A referee’s finding of fact that partnership funds were not used in buying lands standing in the name of two of the parties, if based upon sufficient evidence, and confirmed by the court below, will not be reversed except for manifest error.
    Argued May 11, 1908.
    Appeal, No. 60, Jan. T., 1908, by plaintiff, from order of O. P. McKean Co., June T., 1905, No. 2, dismissing exceptions to referee’s report in case of James H. McGraw v. Robert W. Hilton et al.
    May 25, 1908:
    Before Fell, Brown, Mestrezat, Potter and Elkin, JJ.
    Affirmed.
    Exceptions to report of F. P. Schoonmaker, Esq., referee.
    The opinion of the Supreme Court states the case.

      Error assigned was in dismissing exceptions to report of referee.

      T. E. Mulli/n, of Mullm & Mullm, for appellant.

      E. B. Mayo & Son, with them J. E. Mullm, for appellees.
   Per Curiam,

The bill in this case was by a partner for an account. His right to an account was conceded, and an account of the general business of the partnership was stated by the referee to which no exception was taken by the parties. The single matter in controversy was whether the plaintiff was entitled to an account for the profits-resulting from the purchase of a tract of timber by two of his partners in their own names.

It was alleged in the bill that the timber was bought for the use of the partnership and paid for by the use of its funds. It was denied in the answer that the partnership had any in-' terest in the purchase and that any of its funds were used in payment. There was conflicting evidence on this subject and the findings of the referee, approved by the court, were all against the plaintiff’s contention. The established rule is that findings of fact from conflicting testimony will not be disturbed except for manifest error. We review such findings only to ascertain whether there was evidence which, if believed, warranted them: Steinmeyer v. Siebert, 190 Pa. 471; Lyons v. Lyons, 207 Pa. 13.

The decree is affirmed at the cost of the appellant.


author: Pee Cueiam,

text:
    Marshal, Appellant, v. Foltz.

      Estoppel — Estoppel in pais — Partnership—Partnership lands.

    Where partnership funds are used in the purchase of land but the title is taken in the name of one of the two partners, and after the death of such partner, his widow sells the lands with the knowledge of. the other partner, and without objection by him, and the latter stands silent while improvements are being'made upon the land by purchasers, he is estopped from objecting to the title of the purchasers.
    Argued May 12, 1908.
    Appeal, No. 154, Jan. T., 1908, by plaintiff, from judgment of C. P. Fayette Co., March T., 1907, No. 128, for defendant on case tried by the court without a jury in suit of George C. Marshal v. David C. Foltz.
    Before Fell, Brown, Mestrezat, Potter and Elkin, JJ.
    Affirmed.
    Issue to determine title to real estate in proceedings under the act of 1893.
    Umbel, J., filed the following opinion :
    In 1872 Edmund C. Pechin purchased two pieces of land, known as the Bunker and Allen tracts, situate in Dunbar township, Fayette county, Pa., and for personal reasons took title in the name of Arthur W. Bliss.
    Some time in the seventies, the exact date of the formation of which does not appear, a partnership was formed between Arthur W. Bliss and George C. Marshall, under the firm name of Bliss & Marshall, and, with a legal interruption or two, seems to have continued for one purpose or another until the death of Mr. Bliss in August, 1903.
    In 1881 Bliss & Marshall purchased the Bunker and Allen tracts from Edmund C. Pechin, and paid for them out of the firm funds. As above noted, the title was standing in the name of Arthur W. Bliss, and at the time of the purchase by Bliss & Marshall no change was made in that regard, and it was allowed to continue so, subject to sales and conveyances made, until the death of Mr. Bliss.
    Between the date of the purchase by Bliss & Marshall and the death of Mr. Bliss, a considerable portion of said land was sold in small lots, the deed in all cases being made by Arthur > W. Bliss et ux., and, it would seem, that most of the negotiations in that respect were conducted by Mr. Bliss.
    The management of the said land, so far as use and rent are concerned, seems to have been participated in jointly, and it -was known generally in the community as the Bliss & Marshall land.
    On one part of the said land the firm of Bliss & Marshall for several years operated a fire-brick works which they sold to John Palmer, and while the deed was made by Arthur W. Bliss et ux., the mortgage for the balance of the purchase money was taken in the name of Arthur W. Bliss and George O. Marshall, mortgagees. There is little or no direct testimony on the point as to what disposition was made of the proceeds of the sales made in the lifetime of Mr. Bliss, yet we think, under the circumstances, the presumption is almost overwhelming that he shared them with his partner or accounted for them to the firm of Bliss & Marshall.
    In 1892, George O. Marshall made an assignment for the benefit of his creditors to Jos. H. Kerr; in the deed of assignment he mentions and briefly describes three separate tracts of land of which he was, or claimed to be, the owner or part owner, but makes no mention whatever of the tract in question, nor of any interest therein other than what might be inferred from the general clause after the specific description in the deed, as follows, viz.: “ And also the goods, chattels and effects and property of every kind, real, personal and mixed of the said George C. Marshall.”
    From the record of the proceedings in re, the assigned estate of George O. Marshall, at No. 2, June Term, 1892, insolvent docket, it appears that considerable time elapsed after the assignment was made before anything was. done toward settling the estate by the assignee, and then he moved only after a rule had been issued and served on him and the assignor to show cause why he should not be removed and a suitable person appointed in his place.
    February 3, 1896, more than four years after his appointment, the assignee filed his first and final account, showing a balance, in his hands of $360.50 for distribution among creditors with claims, as proven before the auditor, amounting to $31,610. Something over one-half of the said amount was reduced to judgments which were compromised and satisfied of record in January, 1900.
    There never has been any reconveyance from the assignee to Mr. Marshall, and, so far as the record is concerned, his interest in the land in question stands just as it did immediately after the execution and delivery of the deed of assignment January 29, 1892, recorded in deed book 109, page 413.
    The defendant offered in evidence the record of all the deeds executed by Arthur W. Bliss et ux. to the various purchasers for lots and parts of this land and sold before the death of Mr. Bliss, an examination of which discloses that between the date of the said assignment in January, 1892, and the date of the compromise and satisfaction of the said judgments in the early part of 1900 there were sold a number of these lots, and deeds executed, delivered and recorded, one-half the proceeds of which sales was doubtless distributed to, received and used by Mr. Marshall, as there is no account of it in the insolvent proceedings, even of the proceeds of sales made between the date of the assignment and the date of filing the assignee’s first and final account. The insolvent’s ' one-half above referred to as set forth in the deeds amounted ' to several times as much as was reported and accounted for by the assignee for distribution.
    After the death of Mr. Bliss it was found that Bliss & Marshall were somewhat involved and owed considerable. Mrs. Lida Bliss, as executrix of Arthur W. Bliss, deceased, was desirous of discharging the Bliss & Marshall obligations. While she had no personal knowledge regarding the ownership of the land in question, yet after hearing Mr. Marshall’s statement and claim she was willing, potwithstanding, by the record her husband appeared to be the sole owner, to recognize Mr. Marshall as half owner to the extent of allowing him to share in the proceeds, or that the proceeds realized from the sale of the said land, be applied to the payment of Bliss & Marshall debts, for which it was conceded Mr. Marshall was jointly liable with Mr. Bliss.
    Mrs. Bliss as executrix aforesaid proceeded to make sale of this land for the purpose of paying debts and apply the proceeds to obligations of Bliss & Marshal. She presented her petition to the orphans’ court of Fayette county, at No. 70, September Term, 1904, setting forth, regarding this land, inter alia, as follows, viz.: — “These two tracts of land were purchased by Arthur W. Bliss and George O. Marshall, formerly partners as Bliss & Marshall and for convenience the title was taken in the name of Arthur W. Bliss and had not been changed at the time of his death. They were subsequently subdivided and plotted into lots, as shown by a partial plan thereof recorded in Plan Book, Yol. 1, page 22, and various lots have from time to time been sold and the money divided between said partners as will appear by sundry conveyances of record in the office of the Recorder of Deeds. Subject to the payments of the debts of said partnership and the adjustment of the equities between said partners, the said George C. Marshall is, therefore, entitled to the one-half of the proceeds arising from the sale of the remainder of said tracts. ”
    Under which proceedings several parts were sold, deeds made and recorded, the purchasers taking possession and making improvements. Disposing of the property in this way was attended with more or less trouble, to avoid as much as possible of which, Mrs. Bliss at No. 78, March Term, 1906 and by deed dated March 27, 1906, and recorded March 28, 1906, in deed book 255, page 445, secured title in her own name to the whole balance and thereafter made sales and deeds direct, accounting, however, for the proceeds to the credit of Bliss & Marshall.
    After the death of Mr. Bliss, Mrs. Bliss either as executrix or in her own individual capacity, after securing title in her own name, made certain sales.
    David C. Foltz — the defendant herein — subsequently became the sole owner and in October, 1906, began the erection of a brick works thereon and expended a considerable sum of money in that connection.
    Further, soon after the sale to Foltz & McFarland in May 1906, Mrs. Bliss had prepared and sent to Mr. Marshall a statement ’•of receipts and expenditures in connection with these various sales, offering that he share in the proceeds and showing the balance due him. He does not appear to have made any objection to any of the sales nor to-anything else that was done, nor to have taken any account. of the said notice and statement, but maintained, so far as these matters are concerned, absolute silence and did not move in any particular until ruled in the early part of 1907, to do so under the act of 1893. All this, too, notwithstanding discussion regarding Mr. Marshall’s claim to part of the title to this land was started between representatives of the Bliss estate and Mr. Marshall soon after the death of Mr. Bliss.
    In the face of which we think it would be idle to argue that Mr. Marshall did not have knowledge of what was being done. He is certainly competent to testify regarding matters that have occurred since the death of Mr. Bliss and he does not say but that he was fully advised and apprised, and as a matter of fact we find and conclude that the manner of handling this land was with Mr. Marshall’s knowledge and consent (implied if not expressed).
    In their discussions and efforts to adjust their respective claims regarding this land, it seems to have been conceded that from the date of the purchase from Pechin, they, Bliss & Marshall, had been joint owners and each entitled to one-half the proceeds from sales made. Mrs. Bliss insisting, however, that in consequence of title standing in Mr. Bliss’ name and he always having made the sales or conveyances that the same practice should continue and especially so in view of what she considered Mr. Marshall’s extravagant ideas as to the value of the said land, fearing that if he had to be consulted no sales could be made. The Bliss estate offered to sell its interest to Mr. Marshall for about one-third of what he indicated as his opinion of its value. The testimony shows clearly that he was fully advised in this regard and, as expressed by his counsel, “ it was the rock on which they split,” in their efforts to compromise.
    Mrs. Bliss disposed of this and in several separate parts as above set forth, for the total sum of $10,188.75, which no one now seems to question as not having been considered at that time a good, just, fair and ample price for it and we find as a fact that it was a good and sufficient price.
    CONCLUSIONS OF LAW.
    While a number of interesting and important legal questions were suggested and discussed on the argument of this cáse, no specific requests were submitted and filed, and we are of opinion that the controlling question is the following, viz.:
    Has Mr. Marshall’s silence and conduct in this matter been of such character as to estop him and prevent judgment in his favor in this action ?
    In Logan v. Gardner, 136 Pa. 588, our present Chief Justice says, 1“ The doctrine of estoppel in pais has been very much extended in modern times, particularly in Pennsylvania, where equitable principles are applied in actions at law. The cases are very numerous, but it is not necessary to refer to more than a few of them. In "Woods v. Wilson, 37 Pa. 379, the subject was discussed by Chief Justice Thompson, and it was held that silence, in ignorance of one’s own right or of another’s expenditures will not estop, but that where silence, -with knowledge, is evidence from which a jury may find an estoppel. See also Hill v. Epley, 31 Pa. 331; and Miranville v. Silverthorn, 48 Pa. 147. These decisions rest on the ground that the circumstances were such as to raise a duty to speak, and that failure to do so is either a fraud or would work such an injury as would be equivalent to a fraud, if the party should not be estopped. On the other hand, it was held as .early as Buchanan v. Moore, 13 S. & R. 304, and Robinson v. Justice, 2 P. & W. 19, that positive acts of encouragement or which help to mislead, will raise an estoppel, without any fraud and irrespective of the party’s knowledge of his own rights, and, as was pointed out by Chief Justice Gibson, this result rests on a different principle; that of two innocent parties, the one who occasioned the loss must bear it. See also Chapman v. Chapman, 59 Pa. 214; Miller’s Appeal, 84 Pa. 391; and Putnam v. Tyler, 117 Pa. 570. The distinction, therefore, between the cases where acts or declarations of encouragement are necessary to create an estoppel and those where mere silence or acquiscence will be sufficient, is one of principle, and each case as it arises must be assigned to one or the other class, according to its circumstances, the chief of which is knowledge or ignorance of the party’s own rights and the other’s actions. Encouragement is necessary where the party is ignorant; but knowledge creates the duty to speak, and, where that exists, silence, is enough to estop.”

      A party who stands by and sees a bona fide purchaser making a valuable improvement upon the land in the neighborhood of which the former has resided for nearly twenty years, without giving notice of an equitable title in himself, will be estopped from subsequently asserting the same.
    Silence will postpone a title when one knowing his own right should speak out. One led by such title ignorantly and innocently to rest on his title, believing it secure, and to expend money and make improvements without timely warning, will be protected by estoppel: Redmond v. Saving Fund & Loan Assn., 194 Pa. 643.
    Silence works estoppel when it has misled another to his injury: R. R. Co. v. Dubois, 79 U. S. 47; Hill v. Epley, 31 Pa. 331; Beaupland v. McKeen, 28 Pa. 124.
    The acts of a party done in ignorance of his rights will operate as an estoppel when others have acquired rights on the faith of them : Newman v. Edwards, 34 Pa. 32 ; Duncan’s Appeal, 43 Pa. 67; Miller’s Appeal, 84 Pa. 391; "Wooward v. Tudor, 81* Pa. 382; Putnam v. Tyler, 117 Pa. 570.
    When the acts relied on are positive in their character or the silence so suggestive in its nature that, coupled with the fact of knowledge within the mind of him who, in honesty and fair dealing, ought to speak out, it becomes a fraud on the part of him who could speak, then it is sufficient to estop I such person thereafter from making claim to the subject-matter regarding which such acts were performed or the silence V_raaintained.
    An examination into the facts of the cases where estoppel has been grounded on silence will disclose, that the silence was in relation to facts the injured party must learn through and by him who held it within his breast and failed to reveal it. If both parties have equal means of ascertaining the facts, silence upon such matters and under such circumstances cannot be held to be a fraud.
    In this case we are of opinion “ that the circumstances were such as to raise a duty to speak.” Mr. Marshall was in full possession of all the facts and knew what was going on. He possessed knowledge regarding this matter that could not be secured from any, howsoever extensive examination of the record, and after the death of Mr. Bliss there seems to have been no other source from which such information could be secured than from him.
    An examination of all the deeds from the one whereby Pechin secured title to the Foltz deed, does not reveal a word indicating that George O. Marshall had any interest whatsoever in the title to the said land; the only deed of record bearing on the question — the deed of assignment to Jos. H. Kerr in January, 1892, — would almost warrant the presumption that he did not have any interest in the title to the land in question. We are not prepared to hold that the ex parte statement in the above quotation from the petition at No. 70, March Term, 1904, under the facts in this case, is sufficient to excuse Mr. Marshall for folding his hands and sitting by in silence and permitting all to be done that was done without a word of objection or protest on his part.
    We therefore conclude that, under the circumstances, it was Mr. Marshall’s duty, if not satisfied with what was being done, to speak out, not only for his own rights but for the protection of innocent third persons who were purchasing lots and making improvements thereon, and who could have no other source of definite information than through him. His failure in thát regard, we think, brings him within the rule as above expressed that, “ when silence is so suggestive that, coupled with the fact of knowledge within the mind of him, who in honesty and fair dealing ought to speak out, it becomes a fraud on the part of him who should speak, then it is sufficient to estop.”
    Mr. Marshall’s silence and conduct in this matter have been of such character as to estop him and prevent recovery in this action.
    Now, August 1, 1907, this matter came on to be heard and was argued, and now August 21, 1907, upon and after due consideration and for the reasons set forth in the foregoing opinion it is ordered and directed that judgment be entered in favor of the defendant with costs of suit.

      Error assigned was the judgment of the court.

      E. I. Robinson, of Robinson, McKean & Martin, for appellant.

      JD. M. Hertzog, with him R. M. Garroll, for appellee.

      May 25, 1908 :
   Pee Cueiam,

The judgment is affirmed on the findings by the learned judge of the common pleas.


text:
    Peffer v. Pennsylvania Water Company, Appellant.

      Water companies — Impure water — Equity.
    Where on a bill in equity against a water company it is made to appear that the water furnished by the company was impure and polluted, contained bacteria and bacilli, and was the cause of typhoid fever, the court will enter a decree directing the company to secure and provide a sufficient supply of pure and wholesome water, and further decree that the company shall file a statement within a time specified showing what it proposes to do to comply with the provisions of the Acts of April 29, 1874, P. L. 73, June 2, 1887, P. L. 310, and May 16, 1889, P. L. 226.
    In a proceeding to compel a water company to furnish pure water, the company is not required to furnish chemically pure water. It must furnish water that shall be ordinarily and reasonably pure and wholesome.
    Ordinarily pure and wholesome water means such as is reasonably clean from dirt, discoloration and odor, reasonably free from bacteria and coli or any other infection or contamination which renders the water unfit for domestic use and unsafe and dangerous to individuals.
    Argued May 12, 1908.
    Appeal, No. 8, Oct. T., 1908, by defendant, from decree of O. P. No. 3, Allegheny Co., Aug. T., 1906, No. 398, on bill in equity in case of E. Z. Peffer et al. v. Pennsylvania Water Company.
    Before Fell, Brown, Mesteezat, Pottee and Elkin, JJ.
    Affirmed.
    Bill in equity for an injunction.
    Millee, P. J., specially presiding, filed the following opinion:
    The bill, by three citizens of the borough of Wilkinsburg, alleges that the defendant company is not furnishing reasonably pure and wholesome water to them and to defendant’s consumers, as it is required to do by virtue of its incorporation.
    FINDINGS OF FACT.
    1. The Pennsylvania Water Company, defendant, was chartered in 1887, under the provisions of the act of 1874, for the purpose of supplying water to the inhabitants of the then township of Sterrett, in the county of Allegheny.
    By various mergers and consolidations, on May 26, 1902, a number of other water companies were included under the name of the defendant company; as such it is now authorized by charter to supply water to the public in the Thirty-seventh and Forty-first wards of the city of Pittsburg, in the boroughs of Wilkinsburg, Edgewood, Swissvale, North Braddock, East Pittsburg, Turtle Creek, Wilmerding, Pitcairn, and in. the townships of Penn, Wilkins, Braddock, North Versailles and Patton.
    2. The source of supply of the water furnished by the defendant company is the Allegheny river, which is the most available to furnish an adequate quantity to supply the needs of the defendant company and those of the inhabitants in the districts so supplied.
    This river is also the source of supply for the public municipalities of the cities of Pittsburg and Allegheny, taken from the river in the near vicinity of defendant’s intake pipes.
    3. The pumping station of the defendant company is located in Penn township, on the south side of the Allegheny river, at Nadine station on the Allegheny Valley Railway, a short distance east of the Pittsburg city line. From the time of its incorporation to 1897, the defendant company furnished unfiltered river water to its patrons.
    4. In the year 1896 it constructed, and put in operation in the year 1897, a crib in the Allegheny river, which was constructed primarily as follows:
    A large structure was built thirty-two feet wide, 308 feet long and five feet deep, made of 2"x6" and 2'^8" planks placed edgewise and flatwise respectively, and separated by intervals of about two inches, so as to form a thick wooden grating, setting or forming a rectangular crib or box with an open bottom. A suitable excavation was dredged in the bed of the river to the depth of about ten feet. This excavation is located on the northerly side of the river, about 300 feet from the north shore and about 600 feet from the south shore. The bed of the Allegheny river in this locality for a depth of at least thirty feet is composed of sand and gravel. The crib was sunk to the bottom of the excavation. The surrounding excavation was then filled, and the crib covered to a depth of about one foot with coarse gravel two inches in size; the balance of the excavation was covered with sand and fine gravel such as had passed through a one and a half inch screen to a depth of about four feet, until the excavation was filled even with the ordinary surface of the bed of the river. The depth of the water over the crib ranges ordinarily from eight to ten feet. From the hollow chamber constituting the interior of the crib a twenty-four inch pipe line was constructed across the river, buried under the bed thereof to the defendant company’s pumping station at Nadine."
    Beginning with the year 1897, the defendant company furnished to its patrons water drawn from the interior of the crib above described, and which is referred to in the testimony as crib No. 1. The water so furnished was pumped to the defendant’s reservoir in Penn township, and thence distributed by mains.
    The gravel bed in which said crib is sunk or located is highly permeable and filled with water, partly ground water and partly river water which percolates through said cribs, the water furnished from the crib by the defendant company partly permeating through said gravel beds from the bottom and sides of the crib, and partly river water permeating the bed of sand and gravel covering the top of the crib.
    5. In 1901, owing to the growth of the territory which the company supplied, and anticipating additional demands of the Turtle Creek Talley, the company constructed and placed in operation in the year 1902 two additional cribs in the bed of the Allegheny river, lying to the north or up stream from crib No. 1, and which are referred to in the testimony as cribs Nos. 2”and 3; these were constructed substantially inthe.same manner as the former, except that the interstices between the timbers on top of the cribs were constructed one inch wide; these are forty-eight feet wide, 180 feet long, five feet deep ; they were sunk in the excavations which had been prepared for them, parallel with each other and ten feet apart; these excavations and the tops of the cribs were covered to a depth of about twelve inches with large stone and gravel two inches or more in size, and the whole covered to a depth of about five feet with sand and gravel which had passed through a one inch mesh. A main line of cast iron pipe, ranging from twenty-four inches to forty-two inches in diameter, is laid in the ten feet space excavated between cribs Nos. 2 and 3, with short branches extending at intervals into the interior of both of said cribs ; this main line of forty-two inch pipe so contained in the trench subsequently filled, crosses the river to the defendant’s pumping station at Nadine.
    The river bed in which these latter cribs are located is of the same character as that described surrounding crib No. 1, and the water flowing from the interior thereof is of the same general character as that in No. 1. This water is a great improvement over the raw unfiltered river water, yet it is at times muddy, turbid and odorous, and is not free from impurities, detrimental to comfort and injurious to health.
    The condition of these cribs and pipes and the covering over them, can only be ascertained by soundings and by divers; they are hard to repair and keep in order, difficult of examination, and, in the light of modern development, they are unique and antiquated.
    6. During part of the winter of 1905, 1906, and the spring and early summer of 1906, down to the month of June, 1906, the forty-two inch main leading from cribs Nos. 2 and 3, crossing the Allegheny river to the pumping station, had become displaced at one joint and open on the lower side about four inches ; through this opening unfiltered water so entered the pipe and then to the reservoir and mains of the defendant. In the year 1904 the manhole cover near the pumping house was twice carried away by ice, on each occasion allowing raw water to get into the pipes ; in the summer of 1906 a manhole cover near crib No. 1 became broken and displaced, allowing raw water to enter the mains. With reasonable promptness these defects were remedied ; during their existence the purity of the water was more seriously affected; it was more turbid and contained a higher percentage of bacteria and coli. Holes or excavations have also been found on the surface of these cribs, which has impaired their efficiency.
    7. Eor the purpose of increasing the capacity of these cribs a process of scouring or changing the surface of the river bed covering the cribs is in practice; this is done by means of a heavy iron rake, weighing 400 pounds, three feet long, having seven teeth each fifteen inches long and an inch in diameter ; these teeth contain each three holes three-sixteenths of an inch in diameter, two in front and one in the bottom ; the cross-bar of the rake, which is hollow, is connected with a two-inch hose through which water is forced with a pressure of 125 pounds per square inch. This rake so equipped, with the water forced through the ends thereof, is dragged over the surface of the crib to stir up the silt or covering. It is moved by hand, the rope to which it is attached being wound by windlass connected with barges. The hose action and water pressure is furnished from a boiler and pump in a boat moved along the line of the barges from south to north.
    Cribs Nos. 2 and 3 are thus scoured together, while No. 1 is separate. The rake moved over the same surface three times in succession before a new area is worked.
    In 1905 this work began in May and ended in November; in 1906 it began in May and ended in December, and was continued except as interfered with by the state of the weather or the stage of the river; approximately the same time was occupied in the year prior thereto.
    While this process of raking or scouring is going on the cribs are in constant use, water is continually taken therefrom and pumped into the reservoir and distributed through the defendant’s company’s mains. The disturbance of the surface of the cribs and the destruction of the silt formation thereon permits a large increased volume of raw river water to pass .into the interior of the crib, with less hindrance and consequently less efficient filtering. It is during and immediately after these periods of scouring that the deleterious character of the water is more apparent and more easily ascertainable.
    8. The water shed draining into the Allegheny river at this point covers about 12,000 square miles. It extends east as far as Johnstown on the Conemaugh river, and north beyond Oil City on the Allegheny river, and includes a large number of towns and a thickly populated district. A short distance above these cribs the sewage from the Allegheny county workhouse and the Allegheny city poor farm empties into the Allegheny river with a volume of 188 gallons per minute ; at Oakmont, two and a half miles above, 107 gallons of sewage per minute; at Yerona, still nearer the defendant’s cribs, with sewage of 220 gallons per minute.
    Taking into consideration the extent of the watershed, the territory draining into the Allegheny river, the sewage from towns, villages, cities, public institutions, and the presence of bacteria and coli in the analysis of the raw Allegheny river water, compels the finding as a fact that at the place in question, to wit: the cribs of the defendant company, the Allegheny river is a highly polluted stream.
    9. In 1905 and 1906, typhoid fever, which was prevalent since 1902 in the borough of Wilkinsburg, became an epidemic ; it also prevailed to a great extent in the Thirty-seventh ward, Pittsburg, and in Swissvale borough, supplied by the defendant company, the percentage of cases and the death rate being higher per - thousand capita in Wilkinsburg than anywhere else in the United States ; these typhoid cases were generally distributed throughout the two boroughs and the ward above referred to.
    10. While modern scientific opinion is that typhoid fever may be caused and spread by vegetables, milk, infection, etc., a careful consideration of the large mass of expert testimony given by the witnesses on-both sides in this case justifies the finding as a fact that impure, polluted water, containing bacteria and the colon bacilli, is a prevailing cause of this pestilence.
    11. From the great number of bacterial analyses made by the various experts for both the plaintiffs and the defendant, it appears that bacteria in large numbers exist in the raw Allegheny river water, averaging many thousand per cubic centimeter. It also appears that the quantity of bacteria found in this water after it passes through the filter cribs of the defendant company is very materially reduced when the cribs, pipes and coverings were in perfect condition, and when the scouring process was not going on.
    These analyses also show the presence of colon bacilli in proportionately large quantities in the raw Allegheny river water; their presence is very materially reduced after the water has passed through the filter cribs when they were properly used, in proper repair, and the scouring process was not in operation, but both bacteria and the colon bacilli in dangerous quantities are found in defendant’s water after it bas passed from the filter cribs.
    12. From all the testimony, taking into account the source and character of supply, the effect and amount of contamination and pollution, the presence of bacteria and coli, its turbidity and odor, the prevalence of typhoid fever, the method of increasing the supply while lessening the efficiency of the filter process, the accidents which have occurred since the cribs have been in operation, the inability of the defendant company to continuously examine and repair these cribs, the fact is found that the water furnished by the defendant company is not reasonably pure and wholesome, and that without a change and improvement of its present filtration processes, it cannot furnish reasonably pure and wholesome water.
    13. To construct a new slow sand filtration plant on the bank of the Allegheny river of sufficient capacity to supply the present requirements of the defendant, would require an expenditure of possibly $750,000, the abandonment of the present cribs and an increased cost for operating expenses. A fair capitalization charge for interest, depreciation, etc., would be eight per cent on the cost of the new construction. The defendant company uses at present about 8,000,000 gallons of water per day; the Pennsylvania Railroad Company now being no longer a customer, necessarily the defendant company would have to increase its charges, otherwise it would not be able to secure a fair return for such an increased investment; this, however, is subject to modification for the reason that $750,000 of common stock is outstanding for which no money has been paid, and the franchises of the company are of large value, neither of which are taken into account in the foregoing estimate.
    14. If the defendant company constructed an additional crib or cribs, of the character of those described as cribs Nos. 2 and 3, so as to be able to have not only the larger filter surface, but to be able to cease the use of one or more while the necessary scouring or repairing process is going on, keeping the others in proper condition, maintaining at the same time efficient supervision over the cribs and pipes in use, the water so distributed to its customers would be far less objectionable, dangerous, impure and unwholesome. This construction of an additional crib or cribs is comparatively of small cost as compared with the construction of an entire new slow sand modern filtration plant, oí a new mechanical filtration plant.
    CONCLUSIONS OK LAW.
    1. The fact having been found that the water complained of, as furnished by the defendant, is not reasonably pure and wholesome, it follows that the plaintiffs’ bill must be sustained.
    2. An interlocutory decree will be entered, directing it to secure and provide a sufficient supply of pure and wholesome water; further directing that it shall within three months from the date of decree file a statement of the steps it has taken and proposes to take in compliance with the requirements to furnish reasonably pure and wholesome water, upon the submission of which the plaintiffs may file a reply or answer, as they may deem advisable. It will further be decreed that this case be retained for such further proceedings as may be necessary to insure its performance, and to enable the court to exercise the jurisdiction conferred by the act of assembly under which this action is brought, with liberty on the part of either of the parties to apply to court for further orders and decrees as may be necessary and just.
    3. Defendant to pay the costs.
    OPINION.
    A careful consideration of the voluminous testimony covering about 1,100 typewritten pages, given by a large number of witnesses, including physicians, chemists, engineers and eminent filtration experts from many sections of this country, has compelled the conclusion reached as to the character of the water furnished by the defendant company and requires compliance with the interlocutory decree to be made.
    It is not necessary at this stage of the proceeding to enter into an extended discussion of the case. It may be taken as settled at the outstart that chemically pure water is not the standard. The definition of the water required, that it shall be ordinarily and reasonably pure and wholesome, controls in the cases of Brymer v. Butler "Water Company, 172 Pa. 489 ; Brace Brothers v. Pennsylvania Water Company, 7 Pa. Dist. Rep. 71; Hinkson et al. v. The New Chester Water Company, 8 Del. County Rep. 417. Ordinarily pure and wholesome water necessarily means such as is reasonably clean from dirt, discoloration and odor, reasonably free from bacteria and coli, or any other infection or contamination which renders the water unfit for domestic use and unsafe and dangerous to individuals. Modern investigation and scientific attainments demonstrate that water from polluted sources can by proper filtration be made reasonably safe and pure, and therefore the standard of purity as fixed by the well-recognized authorities must be secured.
    It is not for the court at this time to define what the defendant company shall do in the way of construction of new plants or improvement of the present one. It is estimated in the findings of fact that most objectionable features connected with the present filter cribs is their inaccessibility, the danger of accident from causes not easily ascertained or repaired, and the method taken of increasing the supply by destroying the efficiency of the filtration process, and use of water at the same time. This might be overcome by the construction of additional cribs, putting out of use those that are undergoing the process of disturbance in scouring, and might be aided by more continuous investigation, through divers, of their constant condition; it might be that with the decrease in the demand from the defendant company by reason of the withdrawal of the Pennsylvania Railroad Company’s supply, that the same results can be obtained from the present cribs if the foregoing objections are avoided; these are, however, mere suggestions arising out of the testimony.
    Undoubtedly these cribs have done meritorious work in the past; at the time they were constructed nothing like them was known to exist; they were in advance of the times then, and the company may be able by the same means to improve the character of the supply now.
    The circumstances do not warrant harsh or oppressive burdens to be laid upon defendant at once; it can improve the character of its water supply; but in requiring this to be done regard will be had to the fact that it is entitled to fair consideration, and that those who are interested in it are entitled to fair return from their investment. It is for this reason that ample time will be given in which to formulate plans for its improvements, and submit the same to the court, and ample time will be given for the purpose of putting the same into effect.
    DECREE.
    And now, September 28, 1907, this cause having been heard by the court on evidence offered by the respective parties, and argument of counsel, and the findings of fact, conclusions of law and opinion of the court filed, and exceptions thereto, it is ordered, adjudged and decreed, as follows:
    That the Pennsylvania Water Company, the defendant, having refused and neglected to furnish the plaintiffs and its patrons with a sufficient supply of reasonably pure and wholesome water, the defendant company secure and provide, and at all times hereafter furnish to- the plaintiffs and its other patrons, either by change of its source of supply, by proper filtration, or by some other proper method, a sufficient supply of water, so free from sewage and organic matter, turbidity and odor as to make said water reasonably pure and wholesome.
    Within three months from the date of this decree, the defendant shall file in this cause a statement of the steps it has taken, and which it proposes to take in further compliance with the provisions of this decree, and of the acts of April 29, 1874, June 2, 1887, and May 16, 1889, and that upon filing the said statement, the plaintiffs may file in this cause such statement, suggestion or answer as they may deem advisable.
    That this case be retained in court for such further proceedings as from time to time may be necessary and proper to insure the performance of this decree, and to enable the court to exercise the jurisdiction conferred by the said act of April 29, 1874:, and with the liberty on the part of either party at any time, to apply to the court for such orders and further decrees as may from time to time be necessary and just.
    The costs in this case to be paid by the defendant.

      Error assigned was the decree of the court.

      G. B. Gordon, of Gordon da Smith, with him Geo. W. H&r~ riott and A. W. Buff, for appellant.

      May 25, 1908 :

      B. A. Balsph, with him J. A. Langfitt, of Langfitt <& McIntosh, for appellees.
   Per Curiam,

The decree entered in this case is affirmed on the opinion of Judge Miller.


author: Mr. Justice Brown,

text:
    McNeely Company, Appellant, v. Bank of North America.

      Banks and banking — Check—Forgery—Notice to bank of forgery.

    The duty of a depositor in a bank, upon discovering that it has paid and charged to his account either a check bearing his forged signature as drawer or his check on the forged indorsement of the payee, is to promptly notify it of the forgery.
    The relation between a bank and its depositor is a contractual one. Its undertaking with its depositor is to pay his checks if he has sufficient funds with it for that purpose, and it assumes all the risk as against him of a mispayment in paying and charging to his account a check which he has not signed or one he has signed bearing a forged indorsement of the payee. To his account it may not charge such a check. If it does, the depositor can recover from it the amount so charged. No payment by a bank on a forged signature of a depositor as drawer of a check or on a forged indorsement of his payee can affect him. His right is to get back from the bank whatever he has deposited with it, less what has been properly paid out on his orders. The responsibility of the bank to the depositor is absolute and it can retain no money deposited with it by him to reimburse it for any mispayment it has made out of such deposit; but it can recover from the forger responsible for the mispayment or from those who, by their indorsement of a check, have vouched for previous indorsements or the genuineness of the signature of the alleged drawer.
    Whenever a depositor knowingly withholds from the bank knowledge of a forgery without which the bank cannot proceed in an effort to protect itself, the depositor ought to be regarded when he comes to enforce alleged rights against the bank, as having withheld from it a substantial right without regard to what might or might not have resulted from a prompt exercise of that right. Delay on the part of the depositor leads not only to delay by the bank in proceeding against the forger, but also to possible loss of evidence, and to the possible loss of opportunity of recovering from persons interested in the forger, whose interest may abate by the delay.
    In a suit by a depositor against a bank to recover the amount which it may have improperly paid on a forgery, the issue is the forgery, and this issue ought not to be complicated with another and a speculative one, as to whether anything might have been recovered from the forger, if prompt notice had been given to the bank of the forgery.
    A delay of three months in giving notice to a bank of a forged check, after the discovery of the forgery, will deprive the depositor of his right to recover the amount of the check from the bank.
    Argued Jan. 9, 1908.
    Appeal, No. 223, Jan. T., 1907, by plaintiff, from order of C. P. No. 4, Phila. Co., June T., 1904, No. 1,846, dismissing exceptions to report of referee in case of McNeely Company v. Bank of North America.
    Before Mitchell, C. J., Fell, Brown, Mestbezat, Potter, Elkin and Stewart, JJ.
    Affirmed.
    Exceptions to report of John M. Gest, Esq., referee.
    The facts are stated in the opinion of the Supreme Court.

      Errors assigned were in dismissing exceptions to the report of referee.

      G. W. Pepper, with him B. F. Pepper, for appellant.
    An ordinary writing up of a bank book with a return of vouchers or a statement of accounts, precludes no one from ascertaining the truth and claiming its benefit. See also Leather Mfrs. Nat. Bank v. Morgan, 117 U. S. 96 (6 Sup. Ct. Repr. 657); First Nat. Bank of Washington v. Whitman, 94 U. S. 343.
    If the depositor has not given notice to the bank as soon as he reasonably might, and if during the interim between the full discovery of the forgery and notice, the bank has lost rights over against other parties, the depositors will be es-topped from recovering, but it is submitted that before a bank will be permitted to take refuge behind this defense facts must be proven upon which to base an estoppel. A rule imposing the duty of immediate notice upon a depositor in the absence of such'proof, would be arbitrary, and based neither on sound legal theory nor upon business expediency: Third Nat. Bank v. Merchants’ Nat. Bank, 76 Hun, 475; Critten v. Bank, 171 N. Y. 219 (63 N. E. Repr. 969); Bank of British North America v. Bank, 91 N. Y. 106; Janin v. Bank, 92 Cal. 14 (27 Pac. Repr. 1100); Murphy v. Bank, 77 N. E. Repr. 693; Hardy & Bros. v. Chesapeake Bank, 51 Md. 562; Pollard v. Wellford, 42 S. W. Repr. 23; Weinstein v. Bank, 69 Tex. 38 (6 S. W. Repr. 171).

      Alex. Sinvpson, Jr., of Simpson <& Brown, for appellee.
    A finding by the referee was approved by the court below, and like every other finding by a referee, so approved, is to be held conclusive in this court, unless it is without evidence to support it: Phila. Co. v. Gas Co., 180 Pa. 235; Ridge Ave. Pass. Ry. Co. v. Phila., 181 Pa. 592; Old Colony Trust Co. v. Transit Co., 192 Pa. 596.
    The argument thus presented assumes that the conclusion reached is one of fact, and so it must be. The referee’s inferences from the evidence are like the inferences of a jury, and are to be given the same weight: Bruch v. Phila., 181 Pa. 588; Newlin v. Ackley, 6 Pa. Superior Ct. 337; Van Schaack on Bank Checks, 190.
    Good faith compels prompt notice when the fact becomes known, and the “ settled rules of the law of negotiable paper ” require care and diligence in the ascertainment of the fact, in this and all other matters within the law .merchant: Price v. Neal, 3 Burr. 1354; Rick v. Kelly, 30 Pa. 527; Leather Mfrs. Nat. Bank v. Morgan, 117 U. S. 96 (6 Sup. Ct. Repr. 657); Robb v. Vos, 155 U. S. 13 (15 Sup. Ct. Repr. 4); Cooke v. United States, 91 U. S. 389; Lynch v. Smyth, 25 Colorado, 103 (54 Pac. Repr. 634); Weinstein v. Bank, 69 Texas, 38 (6 S. W. Repr. 171); United States v. Clinton Nat. Bank, 28 Fed. Repr. 357; United States v. Nat. Exchange Bank, 45 Fed. Repr. 163; Iron City Nat. Bank v. Ft. Pitt Nat. Bank, 159 Pa. 46; States v. Bank, 203 Pa. 69.
    Upon the question now under consideration there is absolutely no distinction in principle between the cases of forged signatures and the present case of a forged indorsement. In the former the depositor is bound to inform the bank promptly after settlement of his account, for within a' reasonable time thereafter he is conclusively presumed to know. In the latter he was bound to inform us as soon as he actually did know. In the former, as held in Myers v. Bank, 193 Pa. 1, and kindred cases, the depositor was refused recovery, irrespective of proof of actual loss, because of failure to promptly notify after he should have known; in the latter he should likewise be refused recovery, for failure to promptly notify the bank after he in fact knew, and for precisely the same reason. In each case the imaginary “ last clear chance ” to avoid the loss rested with the bank. In each case the account returned was an account stated simply. In the former case it was urged unsuccessfully that the bank was bound to show as a fact that it could have recouped itself had it known earlier; and no reason can be found in law, logic or common sense, why such a plea should be successful in the latter case, when, as here, there was a long and unnecessary delay after actual knowledge. Does anyone suppose that in the former case three months’ delay and three settlements of the account would have been held reasonable after presumptive knowledge ? Can anyone imagine a real reason why, in the latter case, it should be after actual knowledge ?
    June 2, 1908 :
   Opinion by

Mr. Justice Brown,

McNeely Company, a corporation, was a depositor with the appellee, the Bank of North America, and had in its employ one Charles S. Beber, who, between April 20, 1897, and February 24, 1903, forged the names of payees on ninety checks issued by it. Some of these checks were paid directly to him by the appellee, and others he deposited to the credit of his account with certain banks and bankers, who collected them through the clearing house. Each of said checks was charged to plaintiff’s account with the defendant, and the amount thereof entered as a charge against its deposit in its bank book when the same was settled. On each settlement the balance was struck and entered, after deducting the amount of the checks paid on the forged indorsements. During the period of these forgeries the bank book of the appellant was settled seventy-six times, and all checks that had been paid by the bank, including those bearing the forged indorsements, were regularly returned to the appellant at each settlement of its bank book. Reber continued in its employ until April 1,1903. Some of his forgeries were discovered on or about January 1, 1904, and within two or three weeks thereafter a very large number of the ninety forged indorsements were discovered. The twenty-fourth finding of fact of the referee is: “No notice was given by the plaintiff to the defendant of the forgeries or any of them until April 11, 1904. As stated in finding No. 10, the bank book was settled three times, viz., on February 1, 1904, February 28, 1904, and March 31, 1904, after the discovery of the forgeries and before notice was given thereof on April 11, 1904. During the same period, Robert K. Mc-Neely, who was a director of the bank, attended directors’ meetings weekly from January 4, 1904, to April 11, 1904, a total of fourteen meetings, but gave no notice to the bank concerning the forged indorsements or complaining of their payment.” Robert K. McNeely, referred to in the foregoing finding, was a director of the company and its secretary and treasurer, having charge of its offices and the examination of its trial balances.

Reber was able to conceal his forgeries from his employer by a complicated and ingenious system, which need not be here described, for the referee has found that the appellant was not negligent in failing to discover them sooner, though they extended through a period of nearly six years. The reasons for this finding are unimportant, if the legal conclusion of the referee and court was correct, that the appellant so delayed giving notice to the bank of the forgeries, after it had discovered them, that it cannot recover the amount paid and charged to its account on any of the forged indorsements. The fact that Reber had forged some of the indorsements was, as stated, discovered about January 1, 1904, and within two or three weeks thereafter it was known to the appellant that a very large number of the ninety forgeries had been committed; but no notice of this was given to the bank until nearly three months afterwards.

The duty of a depositor in a bank, upon discovering that it has paid and charged to his account either a check bearing his forged signature as drawer or his check on the forged indorsement of the payee, is to promptly notify it of the forgery. This notification is not only a duty, but it is what a depositor will instinctively do on discovering, upon the return of his bank book with canceled checks charged to his account, that there are among them some which he never signed or which were not paid to the payees named in them. This duty is not questioned by the learned counsel for the appellant. Their contention is, that, for the disregard of it, a depositor is not to be barred from recovering from the bank what it may have ■ paid on his forged signatures or on the forged indorsements of payees named in checks drawn by him, unless, by his failure to promptly notify it of the forgeries, it has lost rights over against other parties, and the burden is upon it to prove such loss. Authorities are not wanting to support this, but the referee and court below did not follow them. Relying upon others, they held that the plaintiff, by reason of its failure to promptly notify the bank of its discovery of the forgeries, could not recover, even though the bank had offered no evidence that it could have protected itself and the plaintiff had not shown that it could not, if prompt notice had been given.

The relation between a bank and its depositor is a contractual one. Its undertaking with its depositor is to pay his checks, if he has sufficient funds with it for that purpose, and it assumes all the risk as against him of a mispayment in paying and charging to his account a check which he has not signed or one which he has signed bearing a forged indorsement of the payee. To his account it may not charge such a check. If it does, the depositor can recover from it the amount so charged. No payment by a bank on a forged signature of a depositor as drawer of a check, or on a forged indorsement of his payee can affect him. His right is to get back from the bank whatever he has deposited with it, less what has been properly paid out on his orders. The responsibility of the bank to the depositor is absolute, and it can retain no money deposited with it by him to reimburse it for any mispayment it has made out of such deposit; but it can recover from a forger responsible for the mispayment, or from those who, by their indorsement of a check, have vouched for previous indorsements or the genuineness of the signature of the alleged drawer.

The right of a bank to recover from a forger, or from those to whom it may have paid a check bearing the forged signature of one of its depositors, or a forged indorsement, is its only remedy for the fraud practiced upon it by the forgery. The depositor’s money is not affected by it, and when he is the first to discover it, it is not reasonable that he should not be required to give prompt notice of it to the bank, if he intends to hold his depository liable for the mispayment, and this without regard to what may or may not result from a prompt effort to recover from the party or parties who may be liable to the bank for the mispayment. The depositor can gain nothing by withholding knowledge of the forgery, but the bank, if kept in ignorance of it after his discovery of it, may lose everything. As soon as a bank learns that it has paid a check on a forged signature of a depositor, or on a forged indorsement on his check, it is its duty to promptly restore to the depositor’s account what was improperly taken from it, and its right at the same time is to proceed against those who wrongfully got the money. This right is to proceed immediately, and to the promptness with which a bank is able to exercise it recovery is often due. When a depositor withholds from his bank his knowledge of the forgery, he withholds from it this right to proceed promptly for its own protection. It may or may not be able to recover from the forger by promptly proceeding against him, but its right is to try by so proceeding; and when one of its depositors discovers that it has innocently sustained a loss, he ought, not only in all good conscience, but as a legal duty, to notify it at once of its mistake, for by withholding from it what he has discovered, he can, as just stated, gain nothing, but it may lose all. A forger may be insolvent or beyond the reach of civil or criminal process, but, by prompt proceedings against him, others may become interested in him and come to his assistance, who after delay may not do so. This incident to a bank’s right to promptly proceed against a forger is not to be overlooked. Whenever a depositor knowingly withholds from it knowledge without which it cannot so proceed in an effort to protect itself, he ought to be regarded, when he comes to enforce alleged rights against it, as having withheld from it a substantial right, without regard to what might or might not have resulted from a prompt exercise of that right. When an indorser on a promissory note defends on the ground that prompt notice was not given him of its nonpayment, the holder will not be heard in reply that, if notice of the nonpayment had been promptly given, it would not have helped the indorser, because he' could have recovered nothing from the maker of the note or prior indorsers. The right of the indorser on a note is to prompt notice of its nonpayment, that he may have an opportunity of proceeding promptly against the maker or prior indorsers, without regard to what may result from his efforts, and if this right is not given him, his liability is at an end. “ The insolvency of the maker of a note, though- known to the indorser, ought not to discharge the holder from giving notice. There are various degrees of insolvency, and it rarely happens that a man is totally insolvent. So .that there is a chance of getting something by an 'application to the debtor. Besides, if a man has nothing of his own, he may have friends, who, to relieve him from pressure, will do something for him. The indorser, therefore, has a chance of securing himself, at least, in part. The only reason that can be assigned for insolvency taking away the necessity of notice is, that notice could be of no use to the indorser; but it is almost impossible to prove that it might not have been of use; therefore, it is necessary: ” Barton v. Baker, 1 S. & R. 334. “Why should a different rule apply to a bank, which never knowingly pays on a forgery but, in cases like the one now before us, is always an innocent victim ?

Delay by a depositor in giving notice to a bank means not only its enforced delay in proceeding against those liable to it, but means loss of evidence as well; and if the rule for which appellant contends should prevail, a bank might be deprived of the opportunity of showing that prompt proceeding on its part would have resulted in its recovering for its loss. And again, in a suit brought by a depositor against a bank to recover the amount which it may have improperly paid on a forgery, the issue is the forgery. This issue ought not to be complicated with another, and a speculative one, as to whether anything might have been recovered from the forger, if prompt notice had been given to the bank of the forgery. The only reasonable and logical rule is the one adopted by the referee and the court below. Our own cases are in harmony with it, and it is approved by high authority. A different one would be putting a premium upon the laches of a depositor, and give to a dishonest one opportunity to help a forger to escape.

Tn Rick v. Kelly and Rick v. Fisher, 30 Pa. 527, the plaintiffs below purchased from the defendants notes bearing the genuine signature of George Fox, as maker, but the forged indorsements of the payee. In reversing the judgments in favor of the plaintiffs and announcing the general rule that notice of a forgery within a reasonable time after discovery is necessary for the maintenance of an action for the recovery of the money paid for such notes, it was said by Portee, J.: The notes in this suit contained a genuine name. For aught that appears, timely application to that party might have saved the debt, for others thought proper to obtain judgments and sell his property. At some stage of the business, the plaintiffs obtained knowledge of the forgery, for they brought the actions and put the fact on record. Why not inform the defendant of his risk, and give him a chance of escape by a direct blow at the maker ? What justice could there be in permitting a holder to hold on until the very close of the period of limitation, and then to spring a suit on the seller, when the genuine parties are dead and their estates gone ? ”

In Myers v. Southwestern National Bank, 193 Pa. 1, in a suit to recover what had been paid by the bank on the forged signature of the plaintiff to checks, judgment on a verdict directed for the defendant was sustained, because the plaintiff had not promptly notified it of the forgeries after he was held to have had notice of them, and we said: “ It was not the bank’s fault that the first forgeries were not promptly discovered and notice thereof given. If the plaintiff’s duty to the bank had been performed at the proper time the fact would have appeared that the bank had charged plaintiff, on his bank book, with the payment of two items ($300 and $200) for which no vouchers appeared among the checks handed to him by his clerk. These vouchers, the two forged checks, had been abstracted and destroyed by the latter. No objection having been made at the time of the first settlement, the bank had a right to assume that everything was correct, including the two checks purporting to be signed by him. His silence was tantamount to a declaration to that effect, and, in afterwards honoring checks signed by the same person, the bank had a right to consider the fact that the signatures had been at least tacitly recognized by the plaintiff as genuine. While the plaintiff was not chargeable with the knowledge of his clerk that the latter had committed the forgery, he was clearly responsible for the acts and omissions of his clerk in the course of the duties with which he was intrusted, viz.: to receive the checks from the bank, take them to his employer’s office, compare the amounts thereof with the amounts in the bank book and check book, etc. In view of the uncontradicted evidence as to the foregoing facts, it cannot be doubted that as between the bank and the plaintiff the latter alone should be held responsible for the consequences resulting from the failure to examine the checks in question and approve or reject them within a reasonable time. In contemplation of law, the delivery of the checks to plaintiff’s clerk was a delivery by the bank to the plaintiff himself, as the basis on which its credits were claimed. The bank was therefore entitled to have them examined and, if rejected, returned within a reasonable time. That was not done, and because of plaintiff’s failure to perform his duty in that regard, he should not be permitted to recover. Any other rule would be inconsistent, not only with general and long-established custom, but also with well-settled principles of law on the subject: Leather Manufacturers’ Bank v. Morgan, 117 U. S. 96, 107; United Security, etc., Co. v. Central Nat. Bank, 185 Pa. 586.”

A very learned referee in United Security Life Insurance and Trust Company of Pennsylvania v. Central National Bank of Philadelphia, 185 Pa. 586, in his report, confirmed by the court, held that the plaintiff was not entitled to recover from the defendant the amounts paid and charged to its account on forged indorsements, because it had not promptly notified the defendant of the forgeries after it had what the referee held to be constructive notice of them. The judgment was reversed solely on the ground that the referee had erred in finding that the plaintiff had had constructive notice of the forgeries on March 27, 1894, and judgment was directed to be entered for it, because, when it actually discovered the forgeries on May 17, 1894, it gave immediate notice to the defendant. What the referee said and what was not held to be error was: “ The referee is of opinion that it is not necessary for the defendant to make effective the defense based upon the want of diligence of the plaintiff in giving notice of the forgery, to show with certainty that had notice been given at an earlier day a fund belonging to Williams (the'forger) was in existence which could have been attached and held. When it is once shown that the plaintiff failed to give prompt notice of the discovery of the forgery, the plaintiff’s right of action is gone. The law assumes, and does not find it necessary to conduct an inquiry to verify the assumption, that had the notice been given promptly, the Central Bank might have taken steps to protect itself as against Williams.”

A sentence from the opinion in Iron City National Bank v. Fort Pitt National Bank, 159 Pa. 46, is pointed to by counsel for the appellant as an expression from this court sustaining their contention. In that case, the present chief justice did say that all a bank which has paid a forged check of one of its depositors “Need do in any case is to give notice promptly according to the circumstances and the usage of the business, and unless the position of the party receiving the money has been altered for the worse in the meantime, it would seem that the date of notice is not material.” This must be read with reference to the facts in that case. As to those in the present one, it is not applicable. There, the Fort Pitt National Bank, the defendant, which received the money on the forged check, had paid it out on the check of its depositor, to whose credit it had been placed, and all that we meant to say was, that, if the bank had not paid it out, and could still have protected itself by withholding it, the date of the notice of the forgery would not have been material.

The rule followed by the learned referee and court below is the only reasonable, logical and proper one in this class of cases. It is approved by the supreme court of the United States in Leather Manufacturers’ Nat. Bank v. Morgan et al., 117 U. S. 96, where it is said by Harlan, J.: “If the depositor was guilty of negligence in not discovering and giving notice of the fraud of his clerk, then the bank was thereby prejudiced, because it was prevented from taking steps, by the arrest of the criminal, or by an attachment of his property, or other form of proceeding, to compel restitution. It is not necessary that it should be made to appear, by evidence, that benefit would certainly have accrued to the bank from an attempt to secure payment from the criminal. Whether the depositor is to be held having ratified what his clerk did, or to have adopted the checks paid by the bank and charged to him, cannot be made, in this action, to depend upon a calculation whether the criminal had at the time the forgeries were committed, or subsequently, property sufficient to meet the demands of the bank. ... As the right to seek and cómpel restoration and payments from the person commiting the forgeries was, in itself, a valuable one, it is sufficient if it appears that the bank, by reason of the negligence of the depositor, was prevented from promptly, and, it may be, effectively, exercising it: Continental Bank v. Nat. Bank of the Commonwealth, above cited: Voorhis v. Olmstead, 66 N. Y. 113, 118; Knights v. Widen, L. R. 5 Q. B. 660 ; Casco Bank v. Keene, 53 Maine, 103 ; Fall River Bank v. Buffinton, 97 Mass. 498.”

Other questions raised by the appellant need not be considered in view of the correct conclusion of the court below that its delay in giving the appellee notice of the forgeries bars its right to recover.

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