deposit to the credit of the payee sufficiently large to pay the note. Nor can he show that he was an accommodation indorser, and that the bank had knowledge of this fact.

NEGOTIABLE INSTRUMENTS - SECURITY AS DISCHARGE OF INDORSER.-The giving of a judgment or other security by the maker or a prior indorser of a note does not discharge a subsequent indorser.

NEGOTIABLE INSTRUMENTS INDEMNITY-EVIDENCEESTOPPEL.-If a note is made payable to the order of the payee, who indorses it, and, after procuring a third person to indorse it for his accommodation, discounts it at a bank, and it is not paid at maturity, such third party indorsing may, in an action against him on the note by the bank, prove that he has been indemnified against liability on the note by a judgment against the payee, and that he has satisfied that judgment by the procurement of the bank whereby he has not only lost his security for 'indemnity, but the bank has advanced its own judgment against the payee to the position of a prior lien. These facts, if proved, would raise an estoppel against the bank.

EVIDENCE.-A GENERAL OFFER TO PROVE RELEVANT facts is competent, and should be admitted. Objection to the mode of proof or the sufficiency of the facts when proved must be made later.

Assumpsit against the second indorser on a note made in favor of Charles Kreamer or order, signed by John W. Buck, and indorsed by Charles Kreamer, E. Peltz, and G. W. Hipple. On the trial, defendant Peltz offered to prove that Kreamer, the payee and first indorser on the note, and who discounted it at the plaintiff bank, had to his credit six days after the note became due, and at other times thereafter, before the bringing of this suit, a balance on deposit in said bank sufficiently large to have paid said note. He also offered to prove that he, the defendant, was an accommodation indorser, and known to be such by said bank; that Kreamer was the principal debtor and known to be such by said bank. This offer of evidence, together with others noticed in the opinion, were ruled out by the trial court, and, after judgment for plaintiff, the defendant specified such rulings as error on appeal.

H. C. Dornan, for the appellant.

W. J. Lewis and Furst & Furst, for the appellee.

517 MITCHELL, J. The first assignment of error cannot be sustained. While a bank which is the holder of a note, and has on deposit at the time of maturity a sum to the credit of any party liable to it on the note sufficient to pay it, and not previously appropriated 518 by the depositor to be held for a different purpose, may apply the deposit to the payment of the note, yet it is not in general bound to do so. The cases where the right becomes a duty on the part of the bank rest on the special equity

of the party, usually the indorser, to have the payment enforced against the depositor as the one primarily liable: Commercial Nat. Bank v. Henninger, 105 Pa. St. 496. And even in these cases all the circumstances enumerated must exist. Thus the deposit must be sufficient at the time of maturity of the note. Subsequent deposits will not raise the duty: People's Bank v. Legrand, 103 Pa. St. 309; 49 Am. Rep. 126; First Nat. Bank v. Shreiner, 110 Pa. St. 188. And the deposit must not have been previously appropriated to any other use: Cases cited supra, and German Nat. Bank v. Foreman, 138 Pa. St. 474, 21 Am. St. Rep. 908, where the principle was conceded though an exception of doubtful correctness was made against a mere notice from the depositor not to pay, unaccompanied by a specific appropriation to a different purpose. And, lastly, the deposit must be to the credit of the party primarily liable. The rule is thus stated by our brother Williams in the latest case on the subject: Mechanics' etc. Bank v. Seitz, 150 Pa. St. 632; 30 Am. St. Rep. 853: "The general rule is well settled that, while the bank may appropriate funds in its hands belonging to any previous party to the note to the payment of it, . . . . yet it is not bound to do The note may be treated as, in effect, an order or check authorizing the bank to apply the deposit to the payment, but the deposit is not payment in law. . . . . But where the bank holds funds of the maker when the note matures, it is bound. to consider the interests of the indorsers or sureties, and if it allows the maker to withdraw his funds after protest, and the indorsers are losers thereby, the bank is liable to them. The reason of this rule is, that the maker is the principal debtor, and liable to all the indorsers, whose undertaking is to pay if he does not."

so.

The appellant's offer was defective in two respects, it was not to show the state of Kreamer's account at the maturity of the note, but some days after, and Kreamer was not the maker of the note but an indorser. It is true that it is claimed by appellant that this was an accommodation note and known by the bank to be so, and that Kreamer was in fact the principal debtor, even as regards the maker. But, if this was so, it was by the arrangement among the parties. On the face of the note, 519 the maker was primarily liable, and although the bank may have supposed, as the cashier testified, from the presentation of the note for discount by the first indorser, that the second and third indorsements were for his accommodation, it was under no obligation to draw that inference as to the maker. But if it had been the duty of the bank to appropriate has not been

carried by any case beyond the deposit of the maker. Nor is it desirable that it should be. On the face of the paper the maker is the party to pay, and while the bank may, upon dishonor, secure payment from the deposit of any party liable to it, yet there is great force in the reasons for limiting its duty to do so to the party legally answerable in the first instance on the face of the paper. The rule thus rests on a liability fixed by law and capable of immediate and conclusive determination by the evidence of the note itself. Otherwise, it is thrown open to contest on the private arrangements of parties, to questions of notice and proof, and to all the uncertainties of the final ascertainment of the facts. While money deposited becomes the property of the bank, yet that result flows from the nature of money, which is to be measured by amount and not by physical identity. Hence a deposit of one hundred dollars is returned by another one hundred dollars without regard to the identity of the notes, or the coin, because legally they are the same. Except for this characteristic, a deposit of money to be returned on demand would be like the deposit of any other article, a mere bailment. But though for this reason the title to money deposited passes to the bank, yet the whole business of banking is founded on the faith of the immediate availability of the deposit, as money, for the use of the depositor, and any rule that interfered with the freedom of action of either bank or customer, by compelling a stop of their dealings with each other to examine the relations of other parties to the deposit, would go far toward destroying that instant convertibility which is the essence of the business. We do not think it desirable to go beyond the line already clearly marked by the authorities.

The second assignment of error cannot be sustained. The giving of a judgment or other security by the maker or a prior indorser does not discharge a subsequent indorser: Guarantee Trust etc. Co. v. Craig, 155 Pa. St. 343.

The third assignment, however, is well founded. The offer 520 of defendant, was, in substance, to show that he had been indemnified against the present liability on the note in suit by a judgment against the prior indorser, Kreamer, and that he had satisfied that judgment on the procurement of the plaintiff bank, whereby he not only lost his security for indemnity in regard to the present claim, but the plaintiff advanced its own judgment against Kreamer to the position of a prior lien. This offer was entirely competent. It was to prove facts which tended to raise an estoppel against the plaintiff in favor of the defendant. It is argued by the appellee that the certificate of

AM ST. REP., VOL. LIII.-44

liens presented was not such as was admissible in evidence, but the objection made and sustained was to the offer as a whole, which was of the certificate, etc., to be followed by proof, etc., How the facts were to be proved, and whether, when proved, they were sufficient to raise an estoppel, were questions not yet reached in the case. It is sufficient that the offer was a general one to prove relevant facts. As such it was competent and should have been admitted. Further objections to the mode of proof, or the sufficiency of the facts when proved, could be raised later.

Judgment reversed and venire de novo awarded.

BANKS-APPLYING DEPOSIT TO PAYMENT NOTE.-A bank holding a depositor's note past due is entitled to set it off against the amount due him upon his deposit account: Bank v. Windisch-Muhlhauser Brewing Co., 50 Ohio St. 151; 40 Am. St. Rep. 660, and note. See, also, the extended note to National Bank v. Smith, 23 Am. Rep. 50.

NEGOTIABLE INSTRUMENTS — INDORSERS-COLLATERAL SECURITY.-An indorser does not exempt himself from liability as such from the fact that he has taken collateral security sufficient to indemnify him against the consequences of his indorsement: Stephenson v. Primrose, 8 Port, 155; 33 Am. Dec. 281, and note.

MOYER V. SUN INSURANCE OFFICE.

[176 PENNSYLVANIA STATE, 579.]

INSURANCE-PROOF OF LOSS-WAIVER.-If an assured, in good faith and within the time stipulated, does what he plainly intends as a compliance with the requirements of his policy in respect to proofs of loss, the failure of the insurance company to notify him of any objections to the proofs furnished constitutes a waiver of obJections to such proofs, and of any other or further proof.

INSURANCE-CONDITIONS IN POLICY-WAIVER.-If the insured, in good faith and within the stipulated time, does what he plainly intends as a full compliance with the requirements of the policy, good faith equally requires that the insurer shall promptly notify him of his objections, so as to give him the opportunity to obviate them, and mere silence, or failure to notify him, as to what further information is desired, or mere notice that "strict compliance with the requirements of the policy will be required," misleading the insured, to his disadvantage, constitutes a waiver by estoppel to obJect to the proofs furnished or to require other or further proofs.

INSURANCE - CONDITIONS-DUTY TO FURNISH CER. TIFICATE OF LOSS.-If a policy of insurance provides that the insured must furnish a certificate of a magistrate or notary as to his loss if required to do so by the insurer, the insured is under no obli gation to furnish such certificate unless required to do so, and notice to him to comply with the conditions of the policy is not notice to furnish the certificate.

INSURANCE-ARBITRATION - SUCCESSIVE REMEDIES. If one clause in a fire insurance policy provides that, in case of loss,

an estimate shall be made by the insured and the company, and another clause provides that in case they differ the subject shall be referred to appraisers selected as therein provided, the remedies are successive, and neither party can insist upon the second who has not shown himself willing and ready to enter upon the first.

Assumpsit upon a policy of fire insurance. After trial and binding directions by the court below to the jury to find for the plaintiff, and verdict and judgment for him, the defendant appealed.

A. A. Leiser, and F. H. Ely, for the appellant.

H. A. Hall and K. J. Tener, for the appellee.

585 FELL, J. The policy of insurance upon which this action was brought contained the usual stipulations with regard to furnishing proofs of loss, and the defense was based mainly upon the failure of the insured to comply with the requirements of the policy in that particular.

The plaintiff, who lived in Camden, New Jersey, had insured with the defendant company a dwelling-house and stable situated in Elk county, Pennsylvania. On August 25, 1894, both buildings were entirely destroyed by fire. He at once notified the agent, and was informed by him that he had notified the proper officers of the company. On September 21st, he received a letter from the adjuster, Mr. Clinger, requesting him to go to Williamsport and "go over the loss," In order to do this, he would be obliged to travel some two hundred miles from his home, and on the 29th he wrote to the adjuster, objecting because of the expense and loss of time it would entail, and asking whether it was "unavoidably necessary." On October 10th, the adjuster replied by letter: "If you think it a hardship to meet me at Williamsport, do not comply with the request, but comply strictly with the policies you hold." On October 11th, the 580 plaintiff wrote to the insurance company stating: 1. That he had a policy issued by it, giving its number, date, and amount, and describing the property insured; 2. That the property had been totally destroyed on August 25th by a fire which originated on the property of a neighbor and had been carried by the wind to his buildings; 3. The amount of insurance in another company; 4. The amount it would cost to replace the buildings. He further stated that he had notified the company's agent, and that their adjuster had examined the property and found the buildings entirely consumed. He then recited the substance of his letter to Mr. Clinger, and continued: "I inclose herewith. copies of both his letters. The last one dated Oct. 10, '94, is