the Union Trust Company. The note was for the accommodation of J. F. Weaver, and he received the proceeds of

LANCASTER LAW REVIEW.

Common Pleas-- Law.

Union Trust Co. v. Enos E. Mowrer.

Accommodation notes-Endorser-Judgment as collateral-Subrogation.

Where the maker of an accommodation note had previously given to a trust company who purchased it a judgment as collateral security for all his notes, present and prospective, and subsequently goes through bankruptcy, the endorser on said note is entitled, on suit by the trust company, to credit for a proportional part of the dividend received by the plaintiff from the bankrupt's personal property, but not of the dividend from the bankrupt's real estate The endorser's promise was in the nature of additional security, and he cannot obtain the sible detriment of the plaintiff until all the other notes are paid, the plaintiff having the right to apply the amount so realized. The dividend received from the personalty was on the notes and that from the real estate on the judgment.

benefit of the real estate dividend to the pos

Trial before Court without jury under Act of April 22, 1874. C. P. of Lancaster County. June Term, 1913, No. 39. John M. Groff, for plaintiff. Coyle & Keller, for defendant.

September 29, 1914. Opinion by LANDIS, P. J.

By the agreement of the parties, in writing, duly filed in the Prothonotary's office of the County of Lancaster, a trial by jury was dispensed with, and this case was heard by the Court and submitted for its decision in accordance with the Act of April 22, 1874, P. L. 109.

FINDINGS OF FACT.-The facts elicited upon the trial are undisputed. On January 9, 1913, J. F. Weaver signed a promissory note for $625.00, payable at the Union Trust Company of Lancaster, Pa., ten days after date, to the order of Enos E. Mowrer, the defendant. Mowrer endorsed the note, and it was purchased by

renewal of a note for $1,000.00, of like character, which had been reduced, from time to time, to $625.00.

On March 14, 1912, there was entered in the Prothonotary's office, to January Term, 1912, No. 250, a judgment bond, signed by J. F. Weaver, for $9,000.00, conditioned to pay the Union Trust Company, its successors or assigns, "all notes now owned or that may in the future be purchased by the Union Trust Company of Lancaster, Penn'a, on which J. Frank Weaver, first party hereto, is or may be maker or indorser, whether accommodation or business paper."

On January 20, 1913, J. Frank Weaver was adjudicated a bankrupt. Immediately prior to that time he was the owner of real and personal estate, all of which passed by virtue of the adjudication, and was subsequently sold under the orders of the District Court of the United States. The real estate was sold for $18,377.80. The costs attending such sale were $86.10; so that the net balance for distribution of the real estate fund was $18,291.70. The liens against the real estate were as follows: Annie E. Weaver, $2,635.42; Emma E. Kreider, $2,097.50; John S. Eshleman, $2,680.20; Annie B. Eshleman, $2,097.50, and Union Trust Company, $3.536.75; and, in addition thereto, and as the last lien upon the real estate, was the $9,000.00 judgment held by the Union Trust Company, as above stated. In the distribution there was awarded, on account of this judgment, the sum of $4.500.00. After this amount was paid to the Union Trust Company, the balance of its indebtedness, amounting to $4,763.25, was presented as a general claim against the fund realized from the sale of the personal property, and there was awarded to the Union Trust Company thereon the sum of $570.83. There was an additional note of $132.64 held by the said company, on which a dividend was awarded of $15.90. The total amount of paper held by the Union Trust Company on the day J. Frank Weaver was adju

charge of such debts, and to that extent the sureties upon notes constituting other debts can have no interest in or right to the mortgaged property. But the several sureties, or any one of them, may, if they choose to do so, pay all the debts secured by the mortgage, and then be, or they will be entitled to be, substituted and stand in the place of the creditor." In the case last cited, one Fish conveyed to the defendants certain personal property, to be held by them as security for the payment of the several promissory notes and drafts for which he was then, or within two years thereafter might become, liable, either as promissor, acceptor, drawer or endorser. The claim of the plaintiffs was for subrogation, because, as they contend, the conveyance of the property to the defendant created a trust in favor of all the sureties and endorsers upon the several notes of Fish discounted and owned by them, and that these sureties and endorsers, being equitable cestuis que trust were entitled to have the proceeds of said property applied to their relief pro rata. On the other hand, the bank contended that it had the right to appropriate a part of the money to certain notes for which it held no other security, and, in addition, had a right to appropriate the balance to sundry other notes made by Fish and endorsed by others who were insolvent. The Court held that the last contention was the correct one, and that the bank had the right to appropriate the whole proceeds of the mortgaged property to the payment of the notes upon which Fish was alone liable and to those made by him upon which the endorsers were insolvent and therefore nothing could be collected. Again, in Fall River National Bank v. Slade, 26 N. E. Rep., 843, it was held that "where stock is pledged to secure a note and any other liabilities of the pledgor to the pledgee, and the same stock is afterwards pledged to the same party to secure a second note and any other liabilities of the pledgor to the pledgee, the proceeds of such stock, when sold by the pledgee, may be applied by him in payment of other notes of the pledgor to him in preference to the notes specified, since

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neither pledge is a special one." It must be remembered that "subrogation rests upon purely equitable grounds, and will not be enforced against superior equities"; and it was, therefore, decided in Musgrave v. Dickson, et al., 172 Pa., 629, that unless the surety pays the debt in full, he is not entitled to subrogation, and until this is done the creditor will be left in full possession and control of the debt and the remedies for its enforcement." In Amer. & Engl. Encycl. of Law, vol. 22, page 869, the doctrine is laid down that "where a creditor holds two notes or obligations, one better secured than the other, and has collateral security for both alike, he has a right, in the absence of any modifying agreement, to have the collateral applied upon the obligation which is most precarious by reason of being least secured." See also 31 Cyc., 864.

With these well-defined rules before us, let us consider the situation presented. The judgment of $9,000.00 was confessed for the benefit of the Union Trust Company. So far as we know, the note in suit was not in existence when the judgment was entered. The surety had, therefore, no equitable rights arising out of any original acquirement made by the Trust Company at its inception, and the judgment was given solely to secure indebtedness of J. Frank Weaver, present and prospective. The judgment was presented against the bankrupt's estate, as well as the notes for which it was held as security; but the $4,500.00 awarded was solely on account of its lien and not as a dividend on the notes. Nor was the dividend awarded for the purpose of paying any particular notes secured by it. There are possibly notes covered thereby for which no other security was taken, and as the debtor is insolvent, the Union Trust Company, if the defendant's contention is correct, will lose part of its security, notwithstanding the endorser's undertaking to pay if the defendant did. not. I think that the endorser's promise was additional security, and he cannot obtain the benefits of the collateral to the detriment of the creditor. The judgment was held for the payment of all the

notes, and until all are paid, and only then, can a third party ask to be permitted to enjoy the collateral in his relief. I also think that, in the first instance, the creditor can apply whatever amount is realized on the collateral to any note covered by it, and only when he is fully paid the surety will be entitled to relief by way of subrogation or other wise. It is unfortunate for the defendant that he became endorser. When, however, he signed the note, he knew he might be called upon to pay, and if he wished security he should have then obtained it for himself. Most of us have had a similar experience, and have realized too late the mistake, with vain regrets. The question presented is not, at first blush, without difficulty; but we do not doubt the correctness of this conclusion, nor that, upon sound legal principles, the law of the case is with the plaintiff.

It is, however, strenuously contended that this case is analogous to Donley . Hays, 17 S. & R., 400, and kindred cases. It was there held that, where a number of bonds are secured by a mortgage, and the holder of said bonds had parted with a portion of them, retaining some himself, and the sum realized by a sale of the mortgaged premises was insufficient to pay them all in full, the distribution must be made pro rata. A mere statement of the proposition clearly shows the distinction. The effect of the transfer of portions of a mortgage, or the distribution between mortgages or judgments entered on the same day, or where a mortgage or judgment is given or property is transferred specifically for the security of more than one note or obligation, is not involved in the present case. Necessarily, under such circumstances, all have equal rights, and the distribution must be pro rata. Nor do cases like Kuhns v. Westmoreland Bank, 2 Watts, 136, and Klopp & Stump v. Lebanon Bank, 46 Pa., 88, have any analogy. There the lien which a bank had upon the stock of its debtor, under the Act of Assembly relating thereto, was held to be for the benefit of the surety of such debtor, and that the surety cannot be deprived of his resulting right. In cases

of this character, the security is fixed by the act of the law and not by the act of the parties themselves. and the rights of every party in interest must be interpreted in conformity thereto.

I, therefore, direct judgment to be entered in favor of the plaintiff and against the defendant for the sum of $625.00, with interest from January 19, 1913, to July 29, 1914, or $57.25. making a total of $682.25, less a credit of $74.38, the proportionate dividend arising out of the personal estate of the bankrupt, or $607.87, with interest, amounting in the aggregate to $624.89. Judgment for plaintiff.

January 9, 1915. Opinion by HASSLER, J.

On August 26, 1911, an order was made in this Court requiring the defendant to pay to his wife the sum of $3.00 a week for the support of their two minor children, one of whom then was six and a half years of age and the other twelve and a half. The older of the boys is now sixteen years of age, and during the summer time is employed on a farm, where he receives his boarding and $8.00 per month. These wages are paid to the mother. The boy is now out of employment.

As the mother receives the benefit of his wages when he has work, and the kind of work he did being largely in the summer time, with no difficulty for the

boy to obtain it, we do not think the father should be required to support him. This is a change in the condition that it is proper for us to consider. The father is a laborer and makes $9.00 a week. We therefore modify the order by providing that after April 1, 1915, the defendant shall pay to his former wife, Kate Maysillis, the sum of $2.00 a week for the support of his son Lester Maysillis.

Rule to modify order made absolute.

Commonwealth v. Arnett.
Murder-Intention-Proof.

It is not sufficient to prove the killing alone or that it was done with a deadly weapon, but such facts must be shown as will warrant a jury in finding that it was intentional or wil

ful. Therefore, in a murder trial the court should affirm a point of the defendant that if the jury believe that the decedent was killed by a shot from a pistol in the hands of the defendant, but when he fired the pistol he did not intend to kill the decedent, but that the killing was accidental, the verdict should be for the defendant.

Indictment No. 45 for murder. Rule for a new trial. O. and T. of Lancaster Co. April Sessions, 1914, No. 45.

John E. Malone, for rule.

John M. Groff, District Att'y, contra. January 9, 1915. Opinion by HASSLER, J.

The defendant was tried and found guilty of murder in the second degree, and we are now asked to grant a new trial.

It appeared in the testimony that on March 22, 1914, a Hungarian named Steve went into an outhouse, or watercloset, in the village of Bainbridge, this county. While standing in it with his back towards the door, which was open, the defendant, a boy of fifteen years of age, came out of his father's house, stood, facing the closet, at a spot within fifteen feet of it, and fired three shots from a revolver. He then went back towards his home. The deceased walked out of the closet to a point about twenty yards from it, where he lay down and died in a couple of minutes. An exam

ination of his body showed that it was pierced by a bullet, which entered at the back, near the region of the left kidney, and came out in front, on the right side, just below the ribs, about an inch lower than the place of entrance. The mark of another bullet was found in the closet.

The defendant testified that he did not see the deceased when he fired the shots. A witness who was at a point about two hundred yards away says the defendant was in a straight line between him and the closet, that the door was open, and that he could plainly see the deceased standing in the closet. This same witness says the defendant fired towards the closet. The defendant and one other witness say that he fired towards the ground. Two witnesses say that, after the Hungarian died, they heard the de

fendant tell his mother that he did not mean to kill him, meaning the Hungarian, but he only meant to scare him. The defendant denied that he said he only meant to scare him, and two other witnesses who were present say they did not hear him say it.

The defendant's case was tried on the theory that he did not shoot at the deceased, but did shoot at the ground, and that the bullet glanced from the ground towards the closet, killing the deceased, whom he did not see. This it was contended was accidental, which would prevent a conviction of the defendant of either of the degrees of murder or of voluntary manslaughter, the only charges of which he could be convicted under

the indictment.

We are convinced of the correctness of our charge and all but one of the answers to the points submitted by the defendant; so that, in our opinion, there is no merit in any of the reasons for a new trial except the fifth. As we are going to make absolute the rule for a new trial because of the fifth reason, it is unnecessary to give our views for this. conclusion.

The fifth reason is as follows: 5. The Court erred in not affirming defendant's first point: "If the jury believe that the decedent was killed by a shot from a pistol in the hands of the defendant, but that the defendant at the time he fired