author: Clark, P. J.,

text:
    Andrews’s Adoption.

      William Carney, for petitioners; C. Victor Johnson, contra.
    Dec. 9, 1929.
   Clark, P. J.,

Oct. 8, 1928, a petition was presented to the court for the adoption of a minor female child by James F. McGrath and Mary C. McGrath, his wife. Oct. 22, 1928, at 10 o’clock A. M., was set for a hearing and testimony was then taken.

The court was not satisfied with the evidence and desired further information as to who the parents of the child to be adopted were, whether they had been notified of the hearing, and had given their consent to the adoption, or whether all the requirements of the statutes had been bona fide complied with.

The petitioner and counsel were accordingly notified that further testimony must be taken. It was promised but not carried out, for what reason we do not know — it may have been forgotten or deemed unnecessary.

The case was officially unnoticed for several months, a year lacking a few days. Some time in the month of September, 1929, the mother of the child appeared in chambers and wanted to know if a child known as Phyllas A. Andrews had been adopted. She was referred to the office of the clerk of the Orphans’ Court; after some research she learned that proceedings were pending for the adoption but there had not been any decree made. Subsequently, the father and mother, Samuel E. and Thelma Raucci, ascertained who had the custody of the child, employed counsel and they filed an answer to the petition, objecting to the adoption as prayed for.

The petition sets forth, inter alia, that the petitioners are residents of Erie, Erie County, Pa.; that the child was born at Corry, Erie County, Pa., Sept. 27,1928; that the child is unmarried, has no estate and is named in the petition as Phyllis A. Andrews, and

“7. That said Phyllis A. Andrews is the child of Thelma Andrews and its male parent is unknown, that the residence of Thelma Andrews is the City of Corry, County of Erie and State of Pennsylvania.”

“9. That hereto annexed are consents to adoption given by Thelma Andrews, the mother of the illegitimate child.”

Attached to the petition is the following alleged blanket consent:

“I, the undersigned, unmarried, being the sole known parent of Phyllas A. Andrews, a female child, born September 27, 1928, in the City of Corry, Erie County, Pennsylvania, do hereby certify that the name of the father of the said minor has been withheld from the petitioners hereinbefore named; that the father has refused to acknowledge said minor as his child; and that I am willing and desirous that said minor be adopted as prayed for in the foregoing petition, and for this purpose I do consent thereto, hereby ratifying and confirming the adoption of the said minor, specifically waiving any and all notices or citation whatsoever.

“Witness: “Thelma Andrews.

“Dr. A. G. Rees

“State of Pennsylvania, County of Erie.

“On this 3 day of October, before me, G. H. Gordon, an alderman in and for said County and State, residing in the City of Corry, Pennsylvania, personally appeared the above named Thelma Andrews to me known to be the person who signed the foregoing release, who in due form of law acknowledged the same to be her act and deed, and desired that it might be recorded as such.

“Witness my hand and official seal the day and year aforesaid.

“G. H. Gordon, Alderman.”

It will be noticed that the alderman’s jurat gives the date Oct. 3 without stating the year.

The answer alleges that Samuel Raucci and Thelma Ross were married May 12, 1928; that there was born to them in lawful wedlock a daughter, Phyllas Aileen Raucci at the Home Maternity Hospital in Corry, Pa., Sept. 27, 1928; that the mother, Thelma Raucci, was an inmate of the hospital two months prior to the birth of her daughter and for some time afterwards; “that while she gave her name to Dr. A. G. Rees, Superintendent of said Home, as being Thelma Andrews and represented to him that she was unmarried, he, the said Dr. A. G. Rees, knew and was advised by her that her maiden name was Thelma Ross, and he also knew her father and mother to be Mr. and Mrs. S. W. Ross and he knew that they all resided in Meadville, Crawford County, Pa.;” that Oct. 3, 1928, their child was delivered to the petitioners; that neither of the natural parents knew who had their child until Oct. 13, 1929; that they did not know the petitioners; that the natural parents did not give their consent to the adoption of their child; that neither of them had any notice of the presentation of the petition for adoption; that the father, Samuel W. Raucci, furnished $339.50 to A. G. Rees, the superintendent, for the care of the mother and the child while in his hospital; that, though the alleged “consent” contains the following: “That I am willing and desirous that said minor be adopted as prayed for in the foregoing petition and for this purpose I do consent thereto,” etc.; no such petition was presented to the mother; that it did not exist Oct. 3, 1928, the day this blanket consent was alleged to have been given; that by this “consent a fraud was perpetrated upon the court,” etc.; that when the consent was signed the mother was an infant under the age of twenty-one years and could not lawfully make an agreement for the adoption of her child; that the parents desire to have the child in their own home; and that the court is without jurisdiction in this matter because the petitioners have not complied with the law, as follows:

“A. There is no consent of either the father or the mother of the child for the adoption prayed for.

“B. The paper purporting to have been signed, acknowledged and delivered by the mother of the said child on Oct. 3, 1928, is not a consent to the adoption prayed for and can in no way abridge the requirement of the act of assembly for such consent in order to give the court jurisdiction to decree an adoption.

“C. There is no allegation in the petition for adoption of said child that either or both of the parents of said child have been adjudged a lunatic or habitual drunkard or that either or both of them had abandoned their said child.

“D. The adoption petition does not set forth correctly the names of the natural parents of said child nor the true name of the child proposed to be adopted.”

Oct. 31, 1929, was set for a hearing. Counsel for petitioners being engaged in another court on that day, the case was continued to Nov. 7, 1929, when testimony was taken and completed.

The findings of fact are as follows:

Thelma Ross was married to Samuel E. Raucci, May 12, 1928; they are living at Meadville, Crawford County, Pennsylvania. The child whose adoption is under consideration was born to them in lawful wedlock, Sept. 27, 1928, at the Home Maternity Hospital in the City of Corry, Pennsylvania. The hospital is patronized mostly for the birth of illegitimate children, and Dr. A. G. Rees conducts the business — is the superintendent or owner — he testifies that he is “the head of” this institution, that this child is the one for whom the adoption proceedings were commenced, and it was taken away from the hospital Oct. 3, 1928, [and] delivered by Dr. Rees to James F. McGrath and Mary C. McGrath, his wife, who went to the hospital in response to an advertisement of a child for adoption. They are the petitioners for the adoption of the child. When they received her they paid Dr. Rees $15 and he gave to Mr. McGrath a paper purporting to be a “consent” of the mother of the child for its adoption. This paper, heretofore mentioned, is a “blanket consent,” was not accompanied by any other papers, and it was made to attach to any petition, no matter who might be named as petitioners.

In the instant case, the petition for adoption was not in existence when this “blanket consent” was executed, yet it contains a statement of a willingness to have the child “adopted as prayed for in the foregoing petition.” It further avers that “the name of the father of the said minor has been withheld from the petitioners hereinbefore named” (there were not any petitioners when the consent was signed), and, further, that the “father has refused to acknowledge said minor as his child;” yet he visited the hospital and paid the expenses of the confinement, $339.50.

The mother testifies, when this “blanket consent” was presented to her, that “Dr. A. G. Rees told me it would be better if I should take a different name so it would not cause any unpleasantness when anything would be looked np,” and then she signed Thelma Andrews.

The petition alleges that the child proposed to be adopted is illegitimate— it is not — and the “blanket consent” is signed by Thelma Andrews as the mother, whereas her married name is Thelma Raucci. She was eighteen years of age when the consent was signed — she was known at the hospital as Thelma Ross.

She gave her name as Thelma Ross and introduced her parents as Mr. and Mrs. S. W. Ross. She received from Dr. A. G. Rees the following receipt:

“Oct. ’th, 1928.

“Received from Mr. S. W. Ross payment in full of all acct. for Thelma Ross. “Home Maternity Hosp.

“Dr. A. G. Rees, Supt.”

Catherine Cassler testified that she was a nurse and had been employed at the hospital eighteen months prior and up to Nov. 2, 1929, and knew the mother as Thelma Ross, that she was so known by other people and nurses there, and that she knew her after she was married by the name of Raucci, but not till after she entered the hospital.

Effie Mae Mackin, a nurse at the hospital before the child was born, and now, was asked: “Do you know Thelma Ross Raucci, and answered, ‘Yes; heard her name as Thelma Ross, never knew her by the name Andrews. She never told me whether she was married or not.’ ”

The parents, Mr. and Mrs. S. W. Ross, lived at Meadville, Pa., visited the hospital and were known to Dr. A. G. Rees, who talked with them several times, as Thelma’s parents. The father of the child also visited the hospital. The father and mother of the child did not have any notice of the presentation of the petition for adoption. They both thought their child was legally adopted at or near the time it was taken away from the hospital. Shortly thereafter both regretted separation from their child; the mother suffered a nervous breakdown grieving for her child. She came to Erie, Pa., Sept. 28, 1929, trying to ascertain the whereabouts of her child and whether it had been adopted or proceedings were pending. On Sept. 30, 1929, she visited the hospital in Corry, Pa., and begged Dr. A. G. Rees to tell her “the name of the people who had taken my baby,” and he said “he was not allowed to tell.” The mother and father visited Erie, Pa., Oct. 13, 1929, learned who had their child, and, as a result, filed in court, Oct. 13, 1929, their answer to the petition for adoption. They have a home in Meadville and the father has regular employment at $160 per month, and sometimes in addition, as a musician playing in an orchestra. The parents are financially able to care for their child and are respectable and of good repute.

The mother was admitted to the hospital July 29, 1928, and left Oct. 6, 1928. The child was taken away Oct. 3, 1928, before the mother got out of bed. She is a Protestant in her religious faith; the faith of her husband is not disclosed in the testimony.

The first hearing in the adoption proceedings was Oct. 22, 1928. James F. McGrath and Mary C. McGrath, his wife, have three children of their own, aged eleven, nine and seven years; they do not own their home, but lease No. 518 Holland Street, Erie, Pa., and are of Catholic faith. Mr. McGrath, on being asked by counsel if he could find the mother, answered: “I presume so, I can get in touch with Dr. Rees, of Corry.”

The reason for the mother’s action may in part be gathered from her testimony. She was asked her purpose in saying and doing what she did, and answered: “The early birth to the marriage. We were married in May, it was born in September. We did not have any home, I lived with my mother and father and he lived with his parents, and we did not have any money, that was all.”

To correct as far as possible their indiscretion, they were secretly married and concluded it was best to create the impression that there was no marriage and that the child was illegitimate, and possibly it might be better to have the child adopted. If so, both the mother and father repented of this conclusion and sought to reclaim the child, prompted by natural feelings of affection.

The mother’s judgment immediately after the birth of the child, still suffering from the pains of her confinement, may not have been of the best or in accord with her wishes after she had fully recovered.

There was an attempt on the part of the hospital authorities to cover up the exact truth, to conceal something and not to let the public know what had happened, and that was carried into court, and what was done comes very close to the perpetration of a fraud.

Dr. Rees testified that “Mr. McGrath said he didn’t want an Italian child. I told Mr. McGrath it was of American extraction [the father is Italian];” that he could not remember what name the mother gave when she came to the hospital (“we do not refer to the girls’ last names when they are there”) ; that he did not advise the McGraths where the mother or her parents lived; that he does not take the names of the parents or their daughters who come to the hospital; and yet he testified that he talked with the mother about her marriage. The first name of the child is spelled Phyllis in the petition and Phyllas in the answer and elsewhere.

The authorities or management of the Home Maternity Hospital at Corry, Pa., have been acting under the assumption that the “consent” attached to the petition in the case at bar is a sufficient consent — is the legal consent of the natural parent.

Dr. A. G. Rees, testifying, says: “I have regular forms made for New York, Pennsylvania and Ohio — regular forms made according to the statute. When they want their child adopted, they give me a right to let the child go when they sign this permit.” “Q. Those forms you speak of are typewritten or printed? A. Typewritten; my lawyer put them up for me.” The present counsel is not that lawyer.

The necessity for a proper legal consent in adoption proceedings has been judicially decided in several cases.

In Vandermis v. Gilbert, 10 Pa. Superior Ct. 570, it appears that a consenting parent died one day before the petition for adoption was presented. It was held that this was a fatal defect, and there was no consent. Pacts alleged in a petition are supposed to be made as of the date when the petition is presented.

The petition must be accurate in every respect.

In Petition of William Mockieviz, 22 Schuyl. Legal Rec. 350, the spelling of the names of the petitioner and of the mother of the child were not uniform in the petition and the signatures; hence, the court could not determine the exact name of the petitioner or of the child. The consent of the mother was not attested. The syllabus, in part, is as follows: “The consent of the parent of the child to be adopted should appear of record in legal form. It is better practice to have all parties in interest appear before the Court.” This case was decided Oct. 11, 1926.

In Petition of Clarence Sinton et al., 24 Schuyl. Legal Rec. 23, decided J an. 9, 1928, by; the same court, [through] Wilhelm, P. J., the infant whose adoption was sought “was in the custody of the Veil Hospital, Langhorne, Pa., or Veil Maternity Hospital, and it advertised the infant for adoption.” In the consent of the mother attached to the petition, the mother says, “I am willing and desirous that said minor be adopted as prayed for in the foregoing petition,” and this statement appears to have been made under oath Sept. 3, 1927. The statement of the petitioners appears to have been made on Dec. 14, 1927, clearly showing that the petition was not complete at the time the mother signed her assent.

The case at bar is the same. That part of the consent quoted above by the court is precisely like that found in the present “blanket consent.”

Proceedings were commenced before us some time ago wherein a “consent,” containing the same sentence, was given and signed by Charles M. James, who alleged that he was the Superintendent of the Veil Hospital, Corry, Pennsylvania, and with this there was also a “blanket consent” signed by the mother of the child, identical with the one in the instant case excepting names and dates. In the case then before us it was brought to the attention of the court that C. M. James, the Superintendent of the Veil Maternity Hospital at Corry, Pa., had “discontinued the hospital there and lived in Langhorne, Pa., and was the Superintendent of the Veil Maternity Hospital at Langhorne, Pennsylvania.”

The defective consent forms used by Superintendent James at Corry, Pa., were used by him in Langhorne, Pa., and declared defective in the ease last cited. These forms were utilized at Corry, Pa., by the present management, and one of these consent forms is attached to the McGrath petition. This form does not meet the requirements of the law, and the alleged consent is invalid.

In Booth v. Van Allen, 7 Phila. 401, “A decree of adoption under the Act of May 4, 1855, will be revoked when it appears to the court that it was obtained by fraud and misrepresentation” is the first syllabus. The court said: “This petition is so framed as to lead to the belief that the infant was an unfortunate child whose father was unknown, whose mother had abandoned it and that there was no one interested in the application except the petitioner and no one to whom notice could be given. . . .”

“In default of parents, it is essential there should be consent by a next friend or guardian of the poor,” etc. “A guardian of the poor or charitable institution can only be allowed to consent to a decree of adoption after they shall have supported the child one year,” this under the law as it then was. The decree of adoption was there revoked.

“Under the Act of May 19, 1887, P. L. 125, the court is without jurisdiction to enter a decree of adoption unless consent of the next friend or guardian of the child appears of record.” Decree of adoption entered May 3, 1904, revoked. The record there did not show the consent of next friend or guardian — there was a rule pending to show cause why this should not be amended, and it was held that the court was without jurisdiction to make the order because of failure of the record to show this consent: Luccareni’s Adoption, 13 Dist. R. 782.

A petition was filed for the adoption of a child of divorced parents, and alleged the mother gave consent and that the father had neglected or refused to provide for the child for a year prior to filing the petition. The father had not been notified of the petition for adoption, and it was never advertised.

A decree was made, a petition to revoke was filed, and a rule was entered to show cause why the adoption decree should not be revoked. The court reopened the proceedings, a full hearing was had upon the petition and the answer, the father and mother appearing, and the decree was sustained; but the court held that an adoption decree should not be awarded without a judicial determination whether the father had neglected or refused to provide for the child for one year as provided by law. “There is no requirement in the statutes or in the rules of court on this subject for notice to the non-neglecting parent.” In that case the husband’s address was known to the wife, for she secured personal service on him in her divorce proceedings.

The Act of May 28, 1915, P. L. 580, was followed in these adoption proceedings: Kelly’s Adoption, 6 D. & C. 506.

The kind of consent necessary under the Act of May 12, 1887, was decided by Judge Lindsey, Oct. 24, 1921, in Letehock’s Adoption, 1 D. & C. 223.

In that case the child to be adopted was born May 5, 1920, and the petition averred that the mother relinquished her right to the child and committed it to the Children’s Home Society of Pennsylvania and consented that it might be adopted by such person or persons as the home might designate. To the petition was attached the following so-called consent: “Know all men by these presents, that Margaret Letehock, of Stockton, Pa., being the mother of Florence Letehock, a child aged three weeks, born May 5, 1920, do hereby relinquish all my right to the said child to the care and custody of the Children’s Home Society of Pennsylvania and do hereby consent that the said child may be legally adopted by such person or persons as may be chosen by the said Children’s Home Society of Pennsylvania without any further notice to the undersigned. Done at Hazleton, Pa., this 26th day of May, 1920.”

The court held that:

“It seems too clear for any argument that the paper purporting to be signed by Margaret Letehock, if designed to divest her of her status or rights as a parent, is illegal and void for such purpose as against public policy,” and, further, that,

“The consent of the parents must be their consent to the particular adoption prayed for, and must be presently given at the time of hearing the petition by the court,” and Vandermis v. Gilbert, 10 Pa. Superior Ct. 570, and, also, Keeler’s Adoption, 52 Pa. Superior Ct. 516, were cited in support.

In the case of Revocation of Adoption by Thomas H. Sleep, 6 Dist. R. 256, the mother entered into a formal written agreement with the Children’s Home Society (chartered as The American Educational Aid Association) to place her child in its custody, and consented that it might “be legally adopted by such person or persons as may be chosen by said [Society] without further notice to the undersigned.”

A rule was entered by the court of its own motion to show cause why the order of adoption should not be revoked, and it was done.

The court says:

“And it would seem, from his testimony and from the facts in this case, that it is considered a part of the humanitarian and philanthropic business of the society, for the alleged good of the child, and especially for the satisfaction of the adopting parents, that the actual parent shall not have intercourse with the child, and, in fact, shall not know where the child is; and a part of the plan shown by the adoption papers in this case is to destroy the identity of the child so that the mother shall not know where the child is or the child shall not know who the mother is, and the adopting parents shall not know the parentage of the child. . . .

“This plan of undertaking to destroy the identity of the child, to hide it from its mother and hide its mother and parentage from it, is, in our judgment, contrary to sound public policy, directly tending to encourage illegitimacy; is a wrong to the child itself, because those who have the education and training of the child should know its parentage and the peculiarities it inherited. It seems to us that it is so contrary to public policy as to make the alleged contract entered into in this case between the mother and Mr. Thompson void. It ignores her affection for her child, the respect that a child should have for the parent. It is so contrary to all our preconceived notions of a true public policy, of morality, of humanity, and of Christianity, that it is shocking to us that any persons who believe in the Bible, or who have any regard for parental affection, should adopt such a plan.”

In Denny’s Adoption, 11 D. & C. 611, the court says:

“Many cases have been cited as to what will amount to an abandonment by counsel both for petitioners and respondent, but a summing up of all of these cases brings the court to the conclusion that every finding must depend on the particular facts as shown in the case before the court.”

An apparent abandonment “certainly forms a more reasonable ground for permitting judicial discretion to decide whether another may assume these claims and duties than the signature of the parent, which a mere impulse may induce. It does not follow that the purpose may not be repented of, and in proper cases all parental rights again acquired, including this statutory right of preventing adoption by withholding consent; but, when once the abandonment is shown to have existed, it becomes a judicial question whether it really has been terminated or can be consistently with the welfare of the child.”

In Keeler’s Adoption, 21 Dist. R. 1106, the mother had surrendered her child to “the Sisters of Charity, Seventieth Street and Woodland Avenue,” and agreed not to interfere “with any one to whom the Sisters may hereafter confide the said child for adoption,” in a paper signed in September, 1909.

The mother regretted doing this and notified the institution and one James T. Sweeney, who petitioned to adopt the child April 23, 1910. After signing the paper, the mother “was persuaded to abstain from taking any steps towards the reclamation of the child until after the birth of another expected child, which was born in March, 1910. The child for adoption was illegitimate and was born July 30, 1908, at the St. Vincent’s Home and Maternity Hospital.

Aug. 12, 1908, the mother left the home and the child in care of that institution. In April, 1909, she took it away and returned it July 28, 1909, and bade it good-bye and then on that day the institution passed the child to James T. Sweeney, the petitioner, under probation with a view to ultimate adoption.

In the proceedings, “this institution was treated as the quasi-parent who had notice.”

A decree of adoption had been made April 23, 1910, and there was an averment of illegitimacy and abandonment. The court held that the real state of the facts was not made known. The executed agreement between the mother and the institution or the Sisters of Charity wherein she consented to an adoption was not sufficient to give the court jurisdiction, the mother had not in law consented and the decree was revoked as having been procured by misrepresentation or concealment of the facts. Section 4 of the Act of April 4, 1925, P. L. 127, provides that the court must be “satisfied that the statements made in the petition are true,” etc.

Keeler’s Adoption, supra,, was appealed and was reviewed by the appellate court in Keeler’s Adoption, 52 Pa. Superior Ct. 516. It will be remembered that there was a signed agreement by the mother for the institution that she would consent to and not oppose an adoption by any one designated by it.

That was not her lawful consent. The court held:

"With the positive knowledge that the mother did not consent to the adoption of her child by any person and was at the time in correspondence with the St. Vincent Home requesting permission to repossess it, the petition in this was presented and the decree secured, without the court being informed of the actual and vital facts of the case. The motive prompting this action was undoubtedly a good one, but the rights of the mother are superior to that of a stranger, and her consent was necessary before such a decree can be held valid. The petitioner evidently so regarded it. It may be well that the court was not designedly imposed on by the petitioner, and he took a chance on the subsequent ratification by the mother. However, the petitioner suppressed a fact, which if known by the court would have prevented the decree, and he is not now in position to complain of a decree which would have been entered had the whole truth been exhibited at the time it was entered. No court of justice will set aside or even be led to look into a solemn judgment on light or trivial ground; but when it is alleged upon adequate proofs that a judgment, in whole or in part, has been obtained by a suppression of truth, which it was the duty of the party to disclose, or by the suggestion of a falsehood or by any of the infinite and, therefore, indefinable means by which fraud may be practiced, no court will allow itself, its records and the process of law to be used as instruments of fraud: Cochran v. Eldridge, 49 Pa. 365. While there is no suggestion of designed or actual fraud, as such, in this case, it was clearly a legal fraud on the court to suppress the jurisdictional facts, and for that reason the decree was invalid, and the same court had ample authority to vacate the decree it had erroneously entered: Fisher v. Railway Co., 185 Pa. 602.”

Adoption proceedings are statutory and the statutes must be strictly complied with. Adoptions are among the most important functions of the court. The transferring of a person from the environment of his birth by reason of which there are created certain reciprocal duties, rights and obligations, parental and filial, into new surroundings and relationships requires intelligent consideration; parental ties are ordinarily stronger than those of a stranger, the welfare of the child is to be sought and the laws of inheritance are affected.

A maternity hospital may be not only a convenience for indiscreet and unfortunate girls, but it should not be conducted to encourage illegitimacy, but as a helpful asylum for ministering to the frailties of erring persons in a lawful way.

The evidence offered on behalf of the petitioners is not clear and convincing, the statements in the petition are not true, the alleged consent of the mother attached to the petition is not valid; it is an attempt to give a consent by proxy which the law does not permit and the courts have rejected; the pleadings and procedure must be correct, the requirements of the act observed and the testimony full, complete and in support of the allegations alleged in the petition, the court should be informed of conditions past and present, to the end that the child to be adopted, the adopting persons, the natural parents and the community may be protected in their several rights and for the welfare of all.

In No. 12 of protestants’ answer there are four paragraphs marked A, B, C and D, giving reasons why a decree of adoption should not be made; they are sustained.

And now, to wit, Dee. 9, 1929, the petition is dismissed, costs of proceedings to be paid by petitioners and protestants, each to bear one-half of same.

From Otto Herbst, Erie, Pa.


source: Caselaw Access Project

author: Stewart, P. J.,

license: Public Domain

text:
    Northampton Trust Company’s Petition.

      H. J. Steele, for petitioner; Robert W. Bowlby, contra.

      Cy'rus E. Woods, Attorney-General, and Harold D. Saylor, Deputy Attorney-General, for Commonwealth, intervening.
    March 10, 1930.
   Stewart, P. J.,

The Northampton Trust Company presented a petition setting forth that it was duly incorporated and organized on April 3, 1902, under the laws of this Commonwealth providing for the incorporation of trust companiés; that the First National Bank of Easton was duly incorporated and organized under the laws of the United States as a national bank; that under an Act of Congress of Feb. 25, 1927, ch. 91, 44 Stat. at L. 1224, amending the Act of Nov. 7, 1918, ch. 209, 40 Stat. at L. 1043, by adding a new section, known as section 3 thereto, the consolidation of a trust company into a national banking association was authorized; which section, in part, reads as follows: “That any bank incorporated under the laws of any state, or any bank incorporated in the District of Columbia, may be consolidated with a national banking association located in the same county, city, town, or village under the charter of such national banking association on such terms and conditions as may be lawfully agreed upon by a majority of the board of directors of each association or bank proposing to consolidate. . . . The capital stock of such consolidated association shall not be less than that required under existing law for the organization of a national banking association in the place in which such consolidated association is located; and all the rights, franchises, and interests of such state or district bank so consolidated with a national banking association in and to every species of property, real, personal, and mixed, and choses in action thereto belonging, shall be deemed to be transferred to and vested in such national banking association into which it consolidated without any deed or other transfer, and the said consolidated national banking association shall hold and enjoy the same and all rights of property, franchises, and interests, including the right of succession as trustee, executor, or in any other fiduciary capacity in the same manner and to the same extent as was held and enjoyed by such state or district bank so consolidated with such national banking association. ... No such consolidation shall be in contravention of the law of the state under which such bank is incorporated. The words ‘state bank,’ ‘state banks,’ ‘bank,’ or ‘banks,’ as used in this section, shall be held to include trust companies, savings banks, or other such corporations or institutions carrying on the banking business under the authority of state laws.” The petition further alleged that at a duly convened meeting of the stockholders of the trust company, 2371 out of a total of 2500 shares (no shares being voted to the contrary) voted for the consolidation of the trust company into the national bank, under the charter of the First National Bank of Easton, and under the title of the First National Bank & Trust Company of Easton; that, on July 1, 1929, the capital stock of the bank was $400,000, and the capital stock of the trust company was $125,000, and after the consolidation the capital stock of said bank was increased to $600,000, and the stockholders of the said trust company assigned and transferred their shares to the bank, and the same were canceled under the terms of the agreement for the consolidation of the two institutions, and the trust company stockholders received in lieu of their stock, stock of the consolidated bank. On July 1, 1929, the Comptroller of the Currency in the Treasury Department of the United States issued his certificate of approval of such consolidation. The petition further alleged that the Pennsylvania Department of Banking, on Nov. 1, 1929, wrote the president of said consolidated bank a letter, enclosing “a copy of the opinion rendered by the Department of Justice, in which we are advised that the corporate existence of a state bank or trust company that is consolidated with a national banking association should be dissolved by the court. We request, therefore, that you proceed under the provisions of the Act of Assembly approved April 9, 1856, P. L. 293, to petition the court for the dissolution of the trust company. If such action is not taken, it will be our duty to advise the attorney-general to institute quo warranto proceedings.” The president of said bank thereupon directed the present proceedings to be begun. The petition further alleged that the Northampton Trust Company, at the time of its consolidation, had no debts or liabilities whatsoever, and that all taxes due to the Commonwealth had been duly paid. The petition for dissolution was signed Northampton Trust Company, by Chester Snyder, Secretary, and the seal of the corporation was attached.

The First National Bank & Trust Company of Easton demurred to the petition, assigning ten causes of demurrer. The eighth is as follows: “The Act of April 26, 1889, P. L. 56, applies only to banking institutions; and as the Act of May 9, 1889, P. L. 159, expressly forbade trust companies from doing a banking business, it has no application to trust companies, and there is no such state legislation applicable to trust companies.” That act was referred to in the opinion of the Department of Justice: In re Consolidation of State and National Banks, 12 D. & C. 626. After discussing the Act of Congress above quoted and the two cases of Petition of Worcester County National Bank of Worcester, 263 Mass. 394, 161 N. E. Repr. 797, and 263 Mass. 444, 162 N. E. Repr. 217, and Ex parte Worcester County National Bank of Worcester, 279 U. S. 347, the opinion ends as follows: “The only statute in Pennsylvania relative to the disposition of the charter of a state bank upon its affiliation with a national bank is the Act of April 26, 1889, P. L. 56, which provides a method for the surrender of the charter of a- state bank upon its becoming a national banking association, but the surrender takes place only upon compliance with the requirements of the act. If, therefore, in any case in which a bank or trust company of this Commonwealth is consolidated with a national banking institution under the Act of Congress referred to above the provisions of the Act of 1889, just referred to, are also followed, a surrender of the charter of the state bank or trust company will necessarily follow. You are, therefore, advised that, unless the provisions of the Act of April 26, 1889, P. L. 56, are followed, the consolidation of a state bank or trust company with a national bank under the Act of Congress of Feb. 25, 1927, does not void the charter or terminate the corporate existence of such state bank or trust company. Proceedings should be taken by the proper officers of the state institution to effect a voluntary dissolution under the provisions of the Act of April 9, 1856, P. L. 293. If such proceedings are not taken, you should return such institution to the Attorney-General, under the provisions of section 17 of the Banking Act of 1923 (Act of June 15, 1923, P. L. 809), as amended by the Act of May 5, 1927, P. L. 762, for the institution of quo warranto proceedings.” The Act of April 26, 1889, P. L. 56, is entitled: “An Act enabling the banks of this Commonwealth to become associations for the purpose of banking under the laws of the United States.” Throughout the act, in none of its eleven sections, is any reference made to trust companies, and the reason was that at the time of the passage of that act there was no general legislation for the incorporation of trust companies. Their history will be found in 2 Eastman on Corporations, page 1274. In general, trust companies had to incorporate under the Act of 1874 and then accept the provisions of the Act of May 9, 1889, P. L. 159. The second paragraph had a proviso, as follows: “Provided, that nothing herein contained shall authorize said companies to engage in the business of banking.” Under the Act of Congress of Nov. 7, 1918, two or more national banks in the same locality were permitted to consolidate, but until the enactment of the McFadden Bill, Feb. 25, 1927, there was no provision for a state bank or trust company to consolidate directly with a local national bank, and it was necessary for the former first to become converted into a national bank by an intricate and expensive process. To remove all doubt, the Act of 1927 specifically mentioned trust companies. We have here the situation that when the Act of April 26, 1889, was passed there was neither state nor Federal legislation relating to trust companies, neither can the word “banking” be construed to include trust companies. See 7 Corpus Juris, 881, § 970; Nash v. Brown, 165 Mass. 384; Mercantile Bank v. New York, 121 U. S. 138. It is plain that it would have no application to a trust company if its provisions had been invoked, and the learned deputy attorney-general, upon the argument, admitted that the Act of 1889 had no application to the present case. The present petition is presented under the Act of April 9, 1856, P. L. 293.

The first, fifth, sixth, seventh, ninth and tenth causes of demurrer are as follows:

“First. That upon the face of the petition the petitioner is not entitled to the relief claimed. . . .

“Fifth. The contract of consolidation was an act of dissolution of the trust company, and when complete on July 1, 1929, it destroyed the stock and transferred all property rights to the respondent.

“Sixth. It is the duty of the court, before it can enter a decree of dissolution, to see that the public welfare and interests of the corporators suffer no prejudice by reason of such act; and the respondent, as successor of said corporators, would be prejudiced by reason of such decree.

“Seventh. The Act of 1856 has no application to the state of facts set forth in the petition. . . .

“Ninth. The effect of the consolidation authorized by the Act of Congress of February 25, 1927, was to extinguish the trust company, and all its property became the property of the respondent.

“Tenth. The said trust company having been extinguished under the agreement of consolidation, and its approval by the Comptroller of the Currency, there is no authority to dissolve an already dead corporation.”

They raise the important questions to be decided.

We have examined the Act of 1856 with care in Easton Transit Company’s Petition, 17 Northamp. Co. Repr. 244, affirmed in 270 Pa. 136. In that case Mr. Justice Simpson said: “Under the Act of April 9, 1856, P. L. 293, the only question to be determined on the hearing of a petition by a corporation for leave to surrender any power contained in its charter, is whether or not such surrender may be granted without prejudice to the public welfare or the interests of the corporators.” In Bangor Electric Company’s Petition, 21 Northamp. Co. Repr. 317, affirmed in 295 Pa. 228, the second syllabus is the same as in the above case. An examination of the act itself shows that a live corporation, and not a dead one, is contemplated. There must be a meeting of the corporators, and a majority must pray for permission either to surrender a power contained in the charter, or for the dissolution of the corporation. It provides for passing on accounts of the managers, directors or trustees, and for dividends of the effects, if any, to the corporators. Omitting the impracticability of having the old stockholders meet after they have surrendered their stock and the same has been canceled and destroyed, and confining our attention only to the provisions of the act in reference to the division of the assets, it will be seen that the act was not intended to apply to a case like the present.

Section 17 of the Act of June 15, 1923, P. L. 809, as amended by the Act of May 5, 1927, P. L. 762 (the only change made by the latter act was to omit the words “after having been liquidated”), may, after two years from July 1, 1929, be invoked by the attorney-general, but that act is not now before us. In our examination we fail to see that there is any necessity for further proceedings to dissolve the trust company for the following reasons: in Ex parte Worcester County National Bank, 279 U. S. 347, the lower court decided, quoting from Mr. Chief Justice Taft’s opinion, as follows: “The third question the court discussed and decided was the validity and binding effect on courts of Massachusetts of the declaration in section 3 of the Act of Congress that the right of succession as trustee, executor or in any other fiduciary capacity, would follow to the same extent as it was held and enjoyed by such state bank. It first inquired what was its meaning, and held that it meant that the original appointment of the state bank was to continue wholly unaffected by the fact that the state bank had ceased to be, and that another and different corporation, whose credit, standing and competency had never been the subject of judicial inquiry for this purpose, must be substituted by virtue of section 3. The court found that this result was in contravention of the law of the commonwealth and contrary to the state and Federal Constitutions.” Again, he said: “In passing on this appeal, we must observe that in determining the policy of a state from its statutes and their construction, we, of course, follow the opinion of the state court, except as it may be affected by the Federal Constitution. When, therefore, the state court holds that an executor, to act as such in the state, must be appointed by the probate court, this court must respect that conclusion and act accordingly. But when the question arises as to what is the proper interpretation and construction of Federal legislation, this court adopts its own view. It is very clear to us that Congress in the enactment of section 3 in the Act of February 25, 1927, was anxious even to the point of repetition to show that it wished to avoid any provision in contravention of the law of the state in which the state trust company and the national bank to be consolidated were located. So strongly manifest is this purpose that we do not hesitate to construe the effect of section 3 in Massachusetts to be only to transfer the property and estate from the trust company to the national bank to be managed and preserved as the state law provides, for administration of estates, and not to transfer the office of executor from the state trust company to the succeeding national bank.” The sole matter decided is contained in the last few lines. The corpus of the estate passed to the bank, but not the office of executor. The Chief Justice nowhere said that the trust company in that case was to be considered alive for the purpose of settling the estate, but he said that the trust company was dead, defunct, but that the bank could not act as executor because under the Massachusetts law an executor must be appointed by a probate court. In the strongest possible way, he said that the entire section 3, quoted above, was constitutional. The view of the Supreme Court of the United States is binding upon our courts. Turner’s Estate, 277 Pa. 110, was a case in which it was decided that a national bank, if it complied with certain provisions, might act as a fiduciary in Pennsylvania. The syllabus of the case is: “If there is any inconsistency between the state acts and the federal acts, the former must yield to the latter. It is not beyond the power of a national bank to agree to comply with state regulations as to fiduciaries where they are in conflict with federal practice. Differences in administrative details between federal and state regulations are not sufficient to deprive a national bank of its powers under the federal laws. The establishment of the Federal Reserve Board was a matter within the scope of the federal power, and a state cannot, in any way, interfere with the powers of such board, except in so far as Congress has permitted the states to do so. The courts will assume that Congress, in enacting the Act of Sept. 26, 1918, 40 Stat. 967, was satisfied with the rules prescribed by the Federal Reserve Board. If these rules conflict with state regulations, the latter must yield to the former, because, the right being conceded, the power to regulate the exercise of the right would follow as a necessary incident.” It has even been decided that no authority other than that conferred by Congress is required to enable a bank or trust company, existing under a general state law, to become a national banking association, and the certificate of the Comptroller of the Currency is conclusive as to the regularity of the proceedings by which the conversion was effected: Casey v. Galli, 94 U. S. 673; Keyser v. Hitz, 133 U. S. 138. In Farmers’ and Mechanics’ National Bank v. Dearing, 91 U. S. 29, Mr. Justice Swayne said: “The constitutionality of the Act of 1864 is not questioned. It rests on the same principle as the act creating the second bank of the United States. The reasoning of Secretary Hamilton, and of this court, in McCulloch v. Maryland, 4 Wheat. 316, and in Osborn v. Bank, 9 Wheat. 738, therefore, applies. The national banks organized under the act are instruments designed to be used to aid the government in the administration of an important branch of the public service. They are means appropriate to that end. Of the degree of the necessity which existed for creating them, Congress is the sole judge. Being such means, brought into existence for this purpose, and intended to be so employed, the states can exercise no control over them, nor in any wise affect their operation, except in so far as Congress may see proper to permit. Anything beyond this is ‘an abuse, because it is the usurpation of power which a single state cannot give.’ Against the national will ‘the states have no power, by taxation or otherwise, to retard, impede, burthen or in any manner control the operation of the constitutional laws enacted by Congress to carry into execution the powers vested in the General Government:’ Bank of the U. S. v. McCulloch, supra; Weston v. Charleston, 2 Pet. 466; Brown v. Maryland, 12 Wheat. 419; Dobbins v. Erie Co., 16 Pet. 435. The power to create carries with it the power to preserve. The latter is a corollary from the former.” The whole purpose of the union between this trust company and the bank having been to continue the bank as a live corporation, and the words being as broad as they are; “every species of property, real, personal, and mixed, and choses in action thereto belonging, shall be deemed to be transferred to and vested in such national banking association into which it is consolidated without any deed or other transfer, and the said consolidated national banking association shall hold and enjoy the same and all rights of property, franchises, and interests including the right of succession as trustee, executor, or in any other fiduciary capacity in the same manner and to the same extent as was held and enjoyed by such state or district bank so consolidated with such national banking association,” the only way in which the identity of the trust company could be preserved would be by showing that such a consolidation was in contravention of the law of the state under which such bank was incorporated. No such state statute has been cited to us, and our examination has not found any. Some light as to the effect of this consolidation may be had by examining some of the authorities on the subject of merger and consolidation of companies. In Central R. R. and Banking Co. v. Georgia, 92 U. S. 665, it is said that whether the consolidation of two corporations works a dissolution of them both and creates a new corporation, “must depend upon the statute under which the consolidation takes place and the intention therein manifested.” In Shields v. Ohio, 95 U. S. 319, Mr. Justice Swayne said: “This renders it necessary to consider the legal status and character of the new corporation. In the present state of the law, a few remarks upon the subject will be sufficient. The legislature had provided for the consolidation. In each case, before it took place, the original companies existed and were independent of each other. It could not occur without their consent. The consolidated company had then no existence. It could have none while the original corporations subsisted. All — the old and the new — could not co-exist. It was a condition precedent to the existence of the new corporation that the old ones should first surrender their vitality and submit to dissolution. That being done, eo instanti the new corporation came into existence.” Again, he said: “When the consolidation was completed, the old corporations were destroyed; a new one was created, and its powers were ‘granted’ to it, in all respects, in the view of the law, as if the old companies had never existed, and neither of them had ever enjoyed the franchises so conferred. The same legislative will created and endowed the new corporation. It did one as much as the other. In this respect, there is no ground for any distinction. These views are sustained by several well-considered cases exactly in point. One of them embodies the unanimous judgment of this court: Clearwater v. Meredith, 1 Wall. 25; McMahan v. Morrison, 16 Ind. 172; The State of Ohio v. Sherman, 22 Ohio St. 411; Shields v. The State of Ohio, 26 Ohio St. 86.” In Keokuk & Western Railroad Co. v. Missouri, 152 U. S. 301, Mr. Justice Brown reviews all the authorities on this subject, and the result of his decision is that it depends upon the statute which authorized the consolidation. He said: “It is impossible to conceive of a corporation existing without stock, or certificates representing the interests of the corporators in the organization. Now, if the act provides that these certificates- shall be surrendered, and certificates in another company' issued in their place, what becomes of the prior companies? Who are their stockholders — who their officers? If the stock in the new company is sold, what interest in the prior companies passes by the sale? There can be but one answer to these questions. The property and franchises of the prior companies are gone as much as if they had formally surrendered their charters. The new company may doubtless receive by transmission from its constituent companies their property, rights, privileges and franchises, including any immunity from taxation: but it receives them as an heir receives the estate of his ancestor, or as a grantee receives the estate of his grantor, by inheritance, succession or purchase.” In Lauman v. Lebanon Valley R. R. Co., 30 Pa. 42, the legislature authorized the Lebanon Valley Railroad Company to consolidate with the Philadelphia & Reading Railway Company, and a dissenting stockholder asked for an injunction to restrain the consolidation, and, inasmuch as the court held that the consolidation in effect destroyed his stock, the injunction was issued, but to be dissolved on giving security to pay for said stock upon its value being ascertained. In the course of the opinion, Mr. Chief Justice Lowrie said: “The contract of consolidation is an act of dissolution in form and substance of the Lebanon Company, and the corporation cannot in the act of dissolution dispose of the rights of its members. . . . The act of dissolution works a change in the form of the interests of its members by destroying the stock and substituting the thing which the stock represented, that is, a legal interest in the property, and leaves the members to such a division of this. . . . The act of transfer and dissolution is one. If carried into effect it destroys his stock.” Lauman v. Lebanon Valley R. R. Co. has been cited with approval in many cases. In Petry et al. v. Harwood Electric Co., 280 Pa. 142, there was a contract between a corporation and its preferred stockholders. The common stockholders brought about a merger with other corporations. It was held that the merger worked a dissolution. On page 147, the very words that we have quoted from the Lauman case were quoted by Mr. Justice Schaffer to show that there was a dissolution in that case. In Houston et al. v. Jefferson College, 63 Pa. 428, three bills were filed. The particulars of the bills are given at the opening of the opinion. Jefferson College and Washington College were merged under the name of Washington and Jefferson College. The second bill was filed by the trustees of Jefferson College. Mr. Chief Justice Thompson said, in reference to that bill: “As to the second of the above-mentioned bills, viz.: The Trustees of Jefferson College v. Washington and Jefferson College, but little is required to be said. We have virtually decided it, in holding, as we have done in the first of these cases, that by the acceptance of the Act of 1865 in connection with Washington College, it ceased to exist under its original charter. There is, therefore, now no such board as the trustees of Jefferson College, with the right of suit in the name of that corporation: 8 Peters, 281. Consequently, the plea of the defendant is sustained, and this bill must be dismissed.” What is there said would apply to the present petition. There is now no such officer as secretary of the trust company. On the general subject, Mr. Chief Justice Thompson said: “The general right of a private corporation to surrender its franchises may possibly have exceptions, but undoubtedly it is the rule. This is generally described as an inherent right, which would necessarily defeat any attempt by legislation to enforce upon a corporation qualities of perpetuity. Such a thing would be impossible in the nature of things. Corporations, like individuals, die by the decay, or loss of their vital functions, and this effectually defies authority, to render them perpetual. A surrender of a franchise is the voluntary death of the corporation, and is one mode by which it may cease to exist: 19 John. 474; 8 Pet. 281. If anybody ever did dispute the right of a corporation to surrender its franchises of its own mere motion, it is not likely that such a contest about the question could be long maintained, where both parties, the state and the corporation, the grantor and grantee, consent to it, absolutely, or on condition.” In the opinion referred to in the pleadings, the learned deputy attorney-general said: “On the other hand, it would seem to be contrary to every principle of law that a corporation created under the laws of one sovereignty could be dissolved and its corporate existence terminated by virtue of the provisions of a law of another sovereignty in the absence of the express consent, evidenced by legislative enactment, of the sovereignty creating such corporation. We can see no escape from this proposition, and it is supported by the authority above cited.”

We think, after having read the decisions above, that entirely too much importance is attached to the matter of the dissolution of a corporation. All the authorities are to the effect that it may happen, either by act of the parties interested, or by the act of the law. If a bank, chartered under the state, can become a national bank without consulting the state, by virtue of a National Banking Act, why cannot a trust company merge with a national bank without the consent of the state, under the provisions of section 3, supra, even if such merger works a dissolution of the trust company? See opinion of Mr. Chief Justice Rugg in 162 N. E. Repr. 217. When the state takes the position which seems to have been taken by the Massachusetts court, that the franchise directed to be transeferred to the national bank, does not mean its charter or its right to be a corporation, is not such a position an interference with a result authorized by Congress, of the same character as those frowned upon in N. P. R. Co. v. North Dakota, 250 U. S. 135; Telephone Co. v. South Dakota, 250 U. S. 163; Second Employers’ Liability Cases, 223 U. S. 1; First National Bank v. Fellows, 244 U. S. 416, and Missouri ex rel. Burnes National Bank v. Duncan, 265 U. S. 17? There seems to us to be no difference in principle. We do not think that the state can compel the trust company to proceed under the Act of 1856.

The mere fact that there is on our statute books the Act of 1856, providing for a voluntary surrender, and the Act of 1927, providing for an adverse proceeding by the attorney-general, does not make such consolidation “in contravention of the law of the state under which such bank is incorporated.”

The petition avers that the trust company has paid all taxes due the Commonwealth, and that it has no outstanding liabilities of any kind. For the purpose of getting the name “Northampton Trust Company” off of the records at Harrisburg, if that has not already been accomplished by filing the certificate of the comptroller of the currency, then the state will have to act by the attorney-general under the Act of May 5, 1927, P. L. 762, supra".

We have been furnished with an opinion by Judge Fox, of Dauphin County, in Commonwealth of Pennsylvania v. Safe Deposit Bank and Trust Company, 14 D. & C. 267. Judge Fox said: “The Commonwealth is asking for a decree of ouster in this case to which the defendant makes no serious objection.” The learned judge did say that the defendant could have surrendered its charter under the Act of 1856, yet it is obvious that he had in mind only section 17 of the Act of 1923 in his decision. We do not understand why there is such vigorous opposition to the present proceeding, nor what is to be gained by a two years’ delay in this matter, but presume that when the attorney-general commences his proceeding in Dauphin County against this trust company, the same position with respect to the effect of the Federal act will be taken there, and that is our only excuse for such an extended discussion as above.

And now, March 10, 1930, this cause came on to be heard at this term, and was argued by counsel, and upon consideration thereof, it is ordered, adjudged and decreed that the first, fifth, sixth, seventh, ninth and tenth causes of demurrer be allowed, and that the petition be dismissed with costs.

The prothonotary will enter this decree nisi, and give notice of same to parties or their counsel, and if no exceptions are filed within ten days, this decree shall be entered by him as a final decree.

Prom Henry D. Maxwell, Easton, Pa.


author: O’Hara, Dep. Att’y-Gen.,

text:
    Employment of School Director by School District.
    July 11, 1930.
   O’Hara, Dep. Att’y-Gen.,

You have requested our opinion upon the following question:

May a school director, who is elected for the legal term of office, resign his office during the term for which he has been elected and thereafter be employed in any capacity by the school district during the period for which he was elected school director and be compensated for his services.

The School Code of May 18, 1911, P. L. 309, section 226, provides:

“No school director shall, during the term for which he was elected or appointed, be employed in any capacity by the school district in which he is elected or appointed, or receive from such school district any pay for services rendered to the district except as provided in this act.”

In our opinion, and you are so advised, the school director may not, during the term for which he is elected or appointed, be employed in any capacity by the school district in which he is elected or appointed, and he may not evade the provision of section 226 of the School Code by resigning his office as school director before the expiration of his term and thereafter accept appointment or employment by the school district within the period for which he was elected.

Under the plain language of section 226, the situation presented by the question here submitted does not fall within the rule which is applied where the Constitution or a statute forbids one to hold or enjoy an office under certain conditions, and under which it has been held sufficient if the electee or appointee divests himself of his disqualification or becomes qualified before the time arrives for him to assume the duties of his ofiice or appointment: De Turk v. Com., 129 Pa. 151; Com. v. Haeseler, 161 Pa. 92; Com. v. Kelly, 255 Pa. 475; Mosby v. Armstrong, 290 Pa. 517; Com. v. Snyder, 294 Pa. 555.

In the language of People ex rel. Ellis, Att’y-Gen., v. Lennon (Mich.), 49 N. W. Repr. 308, the language used in section 226 of the School Code of 1911 fixes the period of his ineligibility and excludes a construction which would have attached in the absence of that language.

Section 226 of the School Code has not been construed by the appellate courts of this state, but under the language of article II, sections 3 and 6, of the Constitution of 1874, which is identical with that of section 226 of the School Code, this Department, in Common Pleas Judgeship, 4 D. & C. 408, held that a representative in the General Assembly, during the time for which he was elected, could not be appointed to the ofiice of judge of the Court of Common Pleas, and attempts to remove such ineligibility by resignation of ofiice have been passed upon by the appellate courts of other states, and, in so doing, they have construed the language of statutes identical or similar to the provision of section 226 of the School Code.

The general law for the incorporation of cities in the State of Michigan contains the following provision:

“. . . ‘No alderman shall be elected or appointed to any other office in the city during the term for which he was elected as alderman, . . .’ ” and the Constitution of the State of Michigan provides that:

“. . . ‘no person elected a member of the legislature shall receive any civil appointment within this state or to the senate of the United States from the governor, the governor and the senate, from the legislature, or any other state authority during the term for which he is elected.’. . .”

In People ex rel. Ellis, Att’y-Gen., v. Lennon, supra, the court held that an alderman whose term of office had not expired by limitation was ineligible to hold the office of chief of police, such officer being appointed by the common council and paid from the city treasury, although he had resigned before the appointment was confirmed.

The court, in its opinion, said:

“. . . The purpose of these statutes is to prevent officers from using their official positions in the creation of offices for themselves or for the appointment of themselves to place. While the law concedes the right of resignation, it is its policy to take away all inducements to the vacation of office. Statutes should be so construed as to give every word and phrase used its common and approved meaning. If it was the intention of the legislature to limit the prohibition to the term of actual service, or simply to make members of the council or aldermen ineligible to other city offices during the term of actual service, the phrases, ‘during the term for which he was elected,’ and ‘during the period for which he was elected,’ are entirely superfluous. The term for which respondent was elected is clearly defined by the charter, and the language, ‘the term for which he was elected,’ has a clear and well-defined meaning. He was elected to serve for two years whether he served that time or not. The language used in the statute fixes the period of his ineligibility, and excludes a construction which would have attached in the absence of that language. It follows that at the time of his appointment respondent was ineligible, . . .”

Article IV, section 19, of the Constitution of California, which took effect on Dec. 21, 1916, reads as follows:

“No senator or member of the assembly shall, during the term for which he shall have been elected, hold or accept any office, trust, or employment under this state; . . . .”

Chambers was elected as a representative for the term beginning January, 1915, and ending January, 1917, but he resigned on Dec. 19, 1916, to accept another office, and the Supreme Court of that state, in Chenoweth v. Chambers (Cal.), 164 Pac. Repr. 428, held that the word “term” referred to the period, for which Chambers was elected and not merely to his incumbency, so that he could not evade the constitutional provision by resignation.

The court, in its opinion, says:

“The word ‘term,’ used in the section, refers, we think, to the period for which the petitioner was elected, and not merely to his incumbency..... When we speak of the ‘term’ for which an officer has been elected, we mean the period of time fixed by statute during which he may serve, and not to the time he may happen to serve. . . .

“We need not consider the effect of petitioner’s resignation prior to the going into effect of the amendment. . . . We do not think that petitioner succeeded in evading its force by his resignation prior to December 21st; for the section deals with a fixed period of time, to wit, the ‘term’ of the officer, and not to the period of his incumbency.”

Under the provisions of section 5 of article III of the Constitution of Florida, no senator or member of the House of Representatives is eligible for appointment or election during the time for which he was elected to any civil office under the Constitution of that state that has been created, or the emoluments whereof shall have been increased, during such time, and in In re Members of Legislature (Fla.), 39 So. Repr. 63, the Supreme Court of that state held that such ineligibility continues during the entire time for which such member was elected, and such member cannot render himself eligibile during such time by resigning his legislative membership.

These authorities clearly point out with irresistible force the only conclusion to be drawn from the language of the section under consideration.

From C. P. Addams, Harrisburg, Pa.


author: Jones, J.,

text:
    Jones v. Fite.

      Thomas Grover, for defendant.
    Jan. 11, 1930.
   Jones, J.,

A summons in assumpsit before a magistrate issued Oct. 19, 1929, returnable Oct. 26, 1929, between 9 and 10 A. M., and an affidavit of personal service upon the defendant at his dwelling house, Wapwallopen, Pa., on Oct. 23, 1929, was made. A hearing was had (no specific date is given)- and a judgment was entered against defendant by default. Certiorari issued within twenty days.

Service of summons should be at least four days before the time of hearing. In this case it was less than required by the act, and, therefore, the proceedings are void for want of jurisdiction of the parties. The exceptions are sustained and the judgment of the justice is reversed.

From Frank P. Slattery, Wilkes-Barre, Pa.


author: Per Curiam,

text:
    Woodward’s Estate.

      Charles Polis, for exceptions; Harold B. Bornemann, contra.
    Oct. 31, 1930.
   Per Curiam,

But one conclusion was possible on the admitted facts; the one drawn by the Auditing Judge and embodied in his adjudication, in which we all concur.

Accordingly, the exceptions are dismissed and the adjudication is confirmed absolutely.


author: Stearns, J.,

text:
    Caskey’s Estate.

      H. James Sautter, for exceptions; William Clarke Mason, contra.
    Nov. 7, 1930.
   Stearns, J.,

We have carefully reviewed the record and are in accord with what the Auditing Judge has found and ruled.

Exceptant, sole beneficiary under her husband’s will, in pursuance to her expressed desire, accepted in partial distribution of the estate an equity in a brokers’ marginal account, which had been maintained by the decedent in his lifetime. The account was regularly assigned to her, and she went in person to the offices of the stock broker for such purpose. Thereafter she executed a receipt and release to her co-executor. Subsequently, as an executrix, she executed and filed the account of the administration of this estate, wherein such distribution credit is noted. What happened after she took over the marginal account on Aug. 2, 1929, is best expressed in the paper book of her counsel:

. . she then blissfully forgot all about this marginal account until the latter part of October, when she was called upon during the 1929 stock market break for additional collateral by the brokers.”

Being unable to comply with the demands of the brokers, exceptant sustained a very substantial loss. She is now endeavoring to charge her corporate co-executor with responsibility for such loss.

There is no evidence indicating fraud in fact or in law. We have not been persuaded under the facts why exceptant’s co-executor should be held liable for a loss which resulted solely from her individual dealing with her own property.

The exceptions are dismissed and the adjudication is confirmed absolutely.


author: Martin, P. J.,

text:
    McConaghy, Administratrix, v. City of Philadelphia.

      Illoway & Felix, for plaintiff; J. P. Gaffney, for defendant.
    Sept. 25, 1930.
   Martin, P. J.,

George P. McConaghy in his lifetime was a battalion chief employed in the Fire Department of the City of Philadelphia.

On May 16, 1923, an act was passed by the Legislature of Pennsylvania providing for a two-platoon system for officers of the fire force of the Department of Public Safety in the City of Philadelphia [P. L. 235]. By the terms of the act, George P. McConaghy would be required to work alternately every twenty-four hours, commencing at 8 o’clock in the morning and ending at 8 o’clock the following morning. From July 1, 1923, until Jan. 31, 1926, George P. McConaghy worked three days, and each fourth day was off duty. He was subject to call in case of emergency at any time. City Council appropriated for his salary between July 1, 1923, and Jan. 1, 1924, $1250, which was paid to him. No appropriation was made for additional payment for the days he worked in addition to the alternate days he would be required to work if the two-platoon system directed by the act of assembly had been adopted. For the year 1924 there was appropriated and paid to him for salary $2500; for the year 1925, $2650; and for the month of January, 1926, $210.41. No appropriation was made to compensate him for extra services rendered during the time he worked in addition to the alternate days required by the act of assembly.

George P. McConaghy having died, Anna McConaghy, as administratrix of his estate, was substituted as plaintiff. She claims payment for six months of the year 1923 at $625; for twelve months of 1924, $1250;. for twelve months of 1925, $1325, and for the month of January, 1926, $105.20, a total of $3305.20.

No appropriation has been made by the City of Philadelphia to pay this claim.

During the time for which this claim is made, George P. McConaghy rendered the service required of him, and accepted the pay appropriated for him, without protest. He is not entitled to recover further compensation on a quantum meruit on the theory that he should not have been required to work during the extra time. He performed the work without protest or demand for extra compensation.

The head of the Department of Public Safety did not divide the chief engineers, deputy chief engineers and the battalion chiefs of the uniformed fire force in the employ of the city into two platoons, as provided in the act of assembly, no two-platoon system was adopted, and there was no change of hours for service of members of the uniformed fire force. Plaintiff’s contractual relation with the city remained unchanged. He continued to work, took no steps to compel the reduction of his working hours, and received the pay for the services performed by him, in accordance with the regulations existing during the time for which he now seeks to recover extra compensation. If he was dissatisfied with the greater number of hours he worked he could have terminated his contract at any time. He did not do so, but continued to perform his duties as batallion chief and to accept the money appropriated by Council as his compensation. He cannot now obtain additional pay.

And now, Sept. 25, 1930, the court being of opinion that the employment of George P. McConaghy by the City of Philadelphia for the extra days claimed in the case stated is not compensable, judgment is entered for the defendant, the City of Philadelphia.


author: Saylor, Dep. Att’y-Gen.,

text:
    Directors of Banks and Trust Companies.
    June 25, 1930.
   Saylor, Dep. Att’y-Gen.,

You have asked for an opinion on the minimum number of directors of a bank or trust company required by the laws of the Commonwealth.

Trust companies, so called, enjoy powers granted to title companies incorporated under the provisions of clause Xix of section 2 of the Act of April 29, 1874, P. L. 73, as amended by the Act of May 9, 1889, P. L. 159. Paragraph 2 of section 5 of the Act of 1874, providing for the election of officers and direetors of corporations organized under the act, reads, inter alia, as follows: “The number of directors or trustees shall not be less than three. . .

The Act of June 17, 1887, § 1, P. L. 411, supplements section 5 of the Act of 1874 by permitting stockholders of corporations to divide their directors or managers into two, three or four classes and to elect the different classes for terms varying from one to four years. To this extent the Act of 1874, section 5, is supplemented, but not amended.

The Act of Feb. 19, 1926, P. L. 30, provides:

“That in all banks, banking corporations or trust companies, heretofore incorporated under special acts of the Legislature, or heretofore or hereafter incorporated under the laws of this Commonwealth concerning banks, banking corporations or trust companies, the board of directors may consist of any number not less than five. . . .”

Section 2 of this act repeals all acts and parts of acts, general, local or special, so far as they are inconsistent with the provisions of section 1. While no specific mention is made of section 5 of the Act of 1874, to the extent that trust companies shall have a minimum of five directors instead of three, the Act of 1874 is, nevertheless, amended.

By the provisions of the Act of May 6, 1927, P. L. 828, section 5 of the Act of 1874 is again supplemented in that a clause is added with respect to the board of trustees or managers of corporations of the first class, but nothing is said in the Act of 1927 with respect to corporations of the second class, which, of course, includes trust companies. Furthermore, nothing is said with reference to the effect of the Act of 1926 on section 5 of the Act of 1874.

So far as the term of office of directors of trust companies is concerned, as provided by the Act of June 17, 1887, there is no change caused by the legislation of 1926 and 1927 referred to, and the Act of 1887 in this respect is the law of the Commonwealth.

There is a question, however, as to whether the Act of 1927, by virtually reenacting section 5 of the Act of 1874 and supplementing it so far as first class corporations are concerned, restores the situation with respect to directors of trust companies as it existed prior to the enactment of the Act of Feb. 19, 1926.

It is a rule of interpretation followed in an unbroken line of decisions in the Commonwealth that a general affirmative statute will not repeal a previous particular statute upon the same subject, though the provisions of the former be different from those of the latter.

It is, therefore, our opinion that, so far as trust companies are concerned, the Act of 1926 is still the law of the Commonwealth and is not modified nor amended by the Act of 1927. You are, therefore, advised that the minimum number of directors of a trust company required by the law of the Commonwealth is five and not three.

Banking companies incorporated under the Act of May 13, 1876, P. L. 161, are required by section 12 thereof, as amended by the Act of July 19, 1917, P. L. 1101, to have not less than five directors. There is no ambiguity in the legislation in, the ease of such institutions as there seems to be with respect to trust companies.

You are, therefore, advised that, as provided by the Act of Feb. 19, 1926, all banks, banking companies and trust companies of the Commonwealth must have a minimum of five directors.

Prom C. P. Addams, Harrisburg, Pa.