Fearon et al. vs. Bankers Trust Co. et al., Receivers.

duty of the Court below was to now dispose of the insufficient security they had taken to the best possible advantage. This task we are satisfied it has done with great patience and with business ability. At the instance of different parties ample time was given for taking full testimony and everything bearing on the properties was brought to light. At the suggestions of the committees representing the bondholders additional equipment and transportation facilities were from time to time provided by receivers' certificates. Leeway of time for the formation of plans of reorganization was afforded to a point when the holders of receivers' certificates became clamorous for their money. Insisting on the sale now, the Court has deferred action to a time when credit was not strained and the financing of a reorganization was feasible. There is no certainty that any future time would be more opportune; there may be danger that if this sale were set aside and months if not years elapse before another plan was evolved, that the last state of the bondholders might be worse than the first.

In view of all these considerations: that the great majority of the bondholders favor this sale; that all bondholders, whether in favor of the sale or objecting to it, will have an opportunity of sharing on equal terms in the reorganization, we are of opinion the Court below committed no

error.

The decrees below are therefore confirmed and the cause remitted to the Court below for further proceedings.

Descent and Distribution

Kaufmann's Estate.

Claim Written Agreement Life EstateSubstituting Remaindermen for Life Tenant by Power of Attorney-Claim Against Life Tenant's Estate-Witness-Competency of Act of 1887. A claim against a decedent's estate will be allowed where there is a written agreement and it appears that the claimant has performed his part of the contract, and there is nothing in the contract to show an indefinite postponement as to the time the sum claimed became due, but the terms indicate a definite period when the claim became due and payable.

The Act of 1887 does not make a surviving claimant an incompetent witness against a decedent's estate where the children of the life tenant (whose husband devised her his estate for life with remainder to their children), a few days after the estate vested in her, turned over the management and control to the children of the entire estate, by power of attorney, wherein she substituted them for herself. By this power of attorney, the life tenant eliminated herself, and the contract of claimant was not with the life tenant, but with those whom she qualified with full power to represent her; in effect this estate passed to the heirs as the husband's estate, thus substituting a party, not as agent, but as principal. This evades the prohibition as to competency of a claimant against the estate of one whose lips are closed by death, and the claimant against the estate of the life tenant would be a competent witness to prove his demand.

Sur Exceptions to Decree. No. 8 April Term, 1916. O. C. Allegheny County.

William Kaufman and Thos. F. Garrahan, for accountant.

Arthur M. Scully and George C. Burgwin, for South Side Trust Company, trustee of bankrupt.

J. M. Russell and E. B. Strassburger, for claimants.

Langfitt & McIntosh, for bankrupt.

Gordon & Smith and James I. Marsh, for exceptant.

MILLER, J., for Court in Banc, July 17, 1916.-The claims of Z. L. Eisner and Wm. A. Rawlings, for compensation in securing mortgage loans, were rejected because there seemed to be nothing in the testimony which took

Kaufmann's Estate.

the claims out of the written provision, Exhibit No. 20, that in case the mortgagees refused to accept payment of the mortgage not then due, the claims failed because the provision prevented its allowance.

The auditing judge's attention was not called to, and he failed to discovers the positive statement in the deposition of Wm. Rawlings in answer to the fourteenth interrogatory, wherein he testified that Mr. Wm. Kaufmann represented that the estate had the privilege of taking up the loan held by the Provident Life & Trust Company, and would accept the money. This statement is nowhere contradicted, and is sufficient, with the other facts in the case, to change the adjudication heretofore entered. The weight of the evidence establishes the fact that through Eisner and Rawlings, assisted by Trueblood, with whom Kaufmann was negotiating, the loan was secured, and the money promised to be paid over by the Massachusetts Mutual Life Insurance Company; that Rawlings, the direct representative of this company, had a written agreement with Kaufmann, that his share of the commission was to be $600.00, and that Eisner was to receive $500.00. Of the mortgages to be paid with this new loan of $75,000, one was past due, the other was not due.

These parties performed their portion of the contract; for these services they are entitled to compensation as agreed upon. The testimony of Rawlings clearly shows that Kaufmann represented that the Provident Life and Trust Company would take its money; if not at the time the examination of title was complete, certainly then at the next interest bearing perio1. The term "abeyance" in the written application and proviso related to this interest bearing period; the contract was to be completed then at the latest; if the insurance company would not have received its money before that period, the company agreed to hold this money and the Kaufmann estate agreed to wait during the period, to wit: the abeyance period, up to the interest bearing date. Consummation of the loan was to be suspended pending the arrival of the interest paying time.

Not only does this statement eliminate the proviso as meaning indefinite postponement, but it naturally accords with what must have been in the minds of the parties; for it is incredible that the loaning company, to wit: The Massachusetts Mutual Life Insurance Company, should hold this sum of money in abeyance indefinitely, or that the representative of the Kaufmann estate intended to hold it liable for an indefinite period, without some clear understanding as to the period of consummation. The claims are, therefore, allowed.

The conclusion reached by the auditing judge with respect to the Wilkins claim will not be disturbed. Conceding that the Act of 1887 is a distinct bar to the competency of a surviving party to a contract where the other party is dead, and that the voluminous cases cited by the learned counsel for the estate all so show, neither the Act, nor the cases cited, apply to the facts in this case.

Mrs. Kaufmann, the decedent, after the death of her husband in 1900, was a very aged woman; she died in 1914. Within a few days after his death she turned over the management and control of the entire estate devised to her, to her four sons, by power of attorney, wherein she substituted them for herself. They knowing the provisions of their father's will, to wit: that his estate left in his wife's possession at her death should go to his children, in equal shares, under the power of attorney assumed full and exclusive control and management thereof. By virtue of this power exercised by them, the decedent, Mrs. Kaufmann, eliminated herself, and the contract of the Wilkins Company was not with her, but with those whom she qualified with full power to represent her; in effect this estate passes to the heirs as the husband's estate. No case is cited where, as

Kaufmann's Estate.

here, the party substitutes another, not as agent, but as principal, in which it has been held that the other party to a contract with the one so substituted and living was prohibited from testifying, by the Act.

The purpose of this statute is wise and beneficial. Properly, it intends that a surviving party to a contract with a decedent should not testify, when the decedent's lips are closed; the effect would produce gross inequality and miscarriage of justice. But where, as here, the deceased party substituted another for herself, and in the instrument of delegation, ratified everything that her substitute should do, to invoke the aid of this statute, when the dealings are wholly between living parties, would produce greater injustice and inequality than was intended to be prevented by the provisions of the original evidence Act, and its various supplements.

This view with respect to the competency of the Wilkins claimants applies to the competency of the parties to the mortgage commission claimants. Their contract was with one of the attorneys in fact.

Not only is the Wilkins claim sustainable on the competency of the testimony in support thereof, but as stated by the auditing judge, irrespective thereof, the claimants established a prima facie case by the introduction of the original book of entries, showing the detailed charges for this work; that the entries were made at periodical times from slips furnished by the workmen, setting forth the time and value of their services, does not impair the entries as made, nor affect its standing as original evidence in a proper book of entries. To rebut the prima facie claim as established, put the respondents on proof.

The exception relating to the failure to allow interest on the advancements to Emanuel Kaufmann is well taken. It seemed to the auditing judge at the time that the charge of interest as to him was an exception, but further examination of the records kept, does not justify the finding of a fact that interest was not also charged against the other heirs who received advancements, even though the character of the calculations differed very materially.

Therefore the exceptions to the allowance of the claims of Eisner and Rawlings are sustained, as is also the exception to the disallowance of interest on the advancements to Emanual Kaufmann. All the other exceptions are dismissed, including the exception filed by the Wilkins Company to the failure to allow interest on the claim; the auditing judge was of the opinion, and his conclusion will not be disturbed, that the amount of the claim at $900.00 as a quantum meruit should be allowed and no more.

Arnold's Estate.

Collateral Inheritance Tax-Determination and Adjudication-Disputed Ques tions——Appeal—Counsel Fees Allowance of.

A claim for collateral inheritance tax is ordinarily determined and adjudicated at the audit, but where there is a dispute as to whether notice of the appraisement was given and also as to title to the realty, these questions should be determined on an appeal.

Counsel fees incurred in litigation over title to real estate begun during the lifetime of decedent but continued after his death are a valid claim against his estate, and it is immaterial whether these expenses were incurred in the capacity of guardian in view of the fact that they were an obligation of the estate, had not been paid or credit claimed in any guardian's account and the amount thereof not questioned, and an exception to their allowance will be dismissed.

Exceptions to Claim for Collateral Inheritance Tax. No. 176 June Term, 1916. O. C. Allegheny County.

Wm. M. Hall, for accountant.

Geo. Weil and Jno. O. Wicks, for Commonwealth.

OPINION.

MILLER, J., July 10, 1916.-Two questions arise under the claim of the Commonwealth for collateral inheritance tax.

The first is, that the tax should now be paid on the appraised value of the real estate unappealed from, which is held by the same parties who are distributees of the personalty.

Ordinarily the liability for this portion of the tax is determined and adjudicated at the audit; but it appears here that the question of notice of the appraisement is disputed, as is also the question of title to the realty, that is, whether the testator died seized thereof, or whether it was vested in the distributees by deed from him in his lifetime.

Under these circumstances the matter must be determined on the appeal or in some other proceeding, and $1,500 will be suspended, to be retained by the accountant until further order of court, pending the determination of the disputed questions.

The other matter in dispute is the Commonwealth's objection to an item of credit of $16,750 claimed by the accountant as paid by him as guardian for expenses of litigation incurred by the decedent's estate in the settlement of the estate of his wife, Isabella T. Arnold, deceased.

Technically, the Commonwealth's contention should be dismissed in the absence of an exception duly filed to this item of credit claimed in the account. But as this objection is not formally raised and the parties desire the matter disposed of now, the rule will be waived.

It appears the decedent was feeble-minded and that his nephew, Robert J. Clelland, was appointed his guardian. In that capacity he instituted proceedings in the Common Pleas Court to determine the title to a large amount of property of which Isabella T. Arnold, the decedent's wife, apparently had died seized; subsequently, at the audit of her estate, he appeared, making claim that the provisions of her will touching devises to charity were invalid, that therefore she died intestate thereof, and that her husband, then still living, was entitled to her estate. This litigation went to the Supreme Court and his contention was sustained; pending the hearing in the Appellate Court, the decedent died and that court directed that an administrator of the estate of the decedent with the will annexed should be raised and the fund in the wife's estate should be paid to him. In this litigation, expenses, including counsel fees, to the amount of the item excepted to were incurred and paid

Arnold's Estate.

by the accountant out of the funds which ultimately came into his hands as administrator.

Under the foregoing facts it is manifest that the guardian did not have control of the property which subsequently was found to be in his ward, but that it passed directly to him as administrator. If the decedent had lived, these charges would have been a valid claim against his estate. It is immaterial whether they were incurred in the capacity of guardian in view of the fact that they were an obligation of the estate, have not been paid or credit claimed in any guardian's account, and the amount thereof not being questioned, no valid objection can lie to the allowance thereof in this account.

The case is ruled by the principles laid down in Line's Estate, 155 Pa., 378, which in substance is, that debts of a decedent must be paid, that the residue only goes to his personal representatives, and that no deductions can be made for legal expenses of beneficiaries in securing possession of the property; this is not the case of beneficiaries securing the possession of the property but the case of the decedent in his own right incurring expenses for the recovery by him of property which the law passed to him; he might have made any other disposition of his property; these beneficiaries might not have received any portion thereof; the fact that they ultimately benefit by his intervention in his wife's estate is a mere incident.

The exception is therefore dismissed.

Carmichael et al., Etc., vs. Gardner.

Contrasts-Malum Prohibitum

of—Right to Recover.

-Printing Lottery Tickets-Suit for Price

Plaintiff recovered a verdict in a suit for a balance due for printing certain matter which plaintiff knew was to be used in carrying out an illegal project, being a "baseball pool" or lottery which under the laws of this State was malum prohibitum. On a motion for judgment non obstante veredicto,— Held: That to prevent a recovery there must not only be knowledge of, but a purpose of furthering the illegal act by a sale and distribution of the tickets, or a participation in the profits, and as there was no evidence that plaintiff thus aided or participated in or received any share of the profits of the scheme, motion for judgment refused.

Motion for New Trial and Judgment N. O. V. No. 922 October Term, 1915. C. P. Allegheny County.

A. O. Fording, for plaintiff.

E. J. Kent, for defendant.

REID, J., November 8, 1916.-This case is before us on motions of defendant for a new trial and for judgment N. O. V.

The action is in assumpsit brought by the Aldine Printing Company, a co-partnership, to recover a balance claimed to be due by defendant for certain printing done by plaintiff firm for the defendant at his request.

The plaintiffs have an extensive printing plant in the City of Pittsburgh equipped to accept and complete large contracts for printing.

Defendant some time before the dates covered by the bill now in controversy called upon the plaintiffs and informed them that he was looking for a printing company which could turn out certain work which he had in contemplation. He explained that it would consist of the pool tickets, score sheets, key-books and other similar matter needed to carry on a "baseball pool" in and about Pittsburgh and in other cities and towns in the United States. His statement and the nature of the work contemplated