MUNICIPAL OFFICERS-DUTIES-AWARDING CONTRACTS.

Act May 23, 1874, directing municipal officers to award certain contracts to the "lowest responsible bidder," vests discretionary, and not merely ministerial, powers in such officers; the word "responsible," as therein used, applying, not alone to pecuniary ability, but also to judgment and skill.

Appeal from court of common pleas, Philadelphia county.

Action by the Interstate Vitrified Brick & Paving Company against the city of Philadelphia, the Mack Paving Company, and others. Decree for plaintiff, and defendants appeal. Reversed.

James Alcorn and Charles F. Warwick, for appellant city of Philadelphia. E. O. Michener, for appellant Mack Paving Co. J. Warren Coulston and John G. Johnson, for appellee.

A

FELL, J. The learned judge of the common pleas, upon the hearing of the application for a preliminary injunction, distinctly found that the director of the department of public works of the city of Philadelphia "had acted for what he considered the best interests of the city," in awarding the contract for paving to the Mack Paving Company. careful examination of the testimony has satisfied us that this finding was correct. There was no allegation in the bill, nor any attempt in the testimony to show, that this officer acted in bad faith; and throughout the whole proceeding his entire honesty of purpose, and his thorough integrity, seem to have been conceded. There then remained but one question, and that related to the power of the director, under the act of May 23, 1874. The decree is based upon the opinion that the director had no alternative but to award the contract "to the lowest bidder who is able pecuniarily to carry out his contract." This was a misconception of the law as it has been repeatedly announced by this court. The construction of the act of 1874 was first before this court in 1876, in the case of Com v. Mitchell, 82 Pa. St. 343; and it was there distinctly held that the word "responsible," as used in the sixth section, meant more than the pecuniary ability of the bidder to carry out the contract, or to be answerable in damages for its breach, or to enter security for its performance, and that the act vested in the officer whose duty it was to award the contract a discretion, and that his powers were not merely ministerial. This case was followed in the same year by Findley v. City of Pittsburgh, 82 Pa. St. 351, in which the same view of the act was stated. The question again arose in 1885, in Douglass v. Com., 108 Pa. St. 559; and it was there

said by Mercur, C. J.: "The act of 23d May, 1874, directing contracts to be awarded to the lowest responsible bidder,' has twice been before us for construction. In each it was held that the word 'responsible,' as used in the act, applies, not to pecuniary ability only, but also to judgment and skill. The duties thereby imposed on the city authorities are not merely ministerial, limited to ascertaining whose bid was the lowest, and the pecuniary responsibility of the bidder and his sureties. The act calls for the exercise of duties which are deliberative and discretionary." This doctrine was reaffirmed in 1891 in Pavement Co. v. Wagner, 139 Pa. St. 623, 21 Atl. 160. It therefore follows that, under the findings of fact by the learned judge, there was but one conclusion that was in harmony with the decided cases. The decree of July 9, 1894, granting an injunction, is reversed and set aside, and the injunction dissolved, at the cost of the appellee. WILLIAMS, J., dissents.

ATKINSON et al. v. CITY OF PHILADEL PHIA et al. (No. 201.)

(Supreme Court of Pennsylvania. Oct. 29, 1894.)

Appeal from court of common pleas, Philadelphia county.

Action by John Atkinson and another against the city of Philadelphia, the Mack Paving Company, and others. Decree for plaintiffs, and defendants appeal. Reversed.

James Alcorn and Charles F. Warwick, for appellant city of Philadelphia. E. O. Michener, for appellant Mack Paving Co. J. Warren Coulston and John G. Johnson, for appellees.

Where there was evidence that plaintiff, a freight conductor, was injured without fault on his part, and wholly from the negligence of a flagman, who was habitually careless, and whose unfitness for the position was known to the defendant long enough before the accident to enable it to procure some one else, the liability of defendant is a question for the jury.

Appeal from court of common pleas, Fayette county.

Action by Robert Hughes against the Baltimore & Ohio Railroad Company for per sonal injuries. There was a judgment for plaintiff, from which defendant appeals. Af firmed.

Robert E. Umbel. for appellant. R. H. Lindsey, George B. Jeffries, and D. W. McDonald, for appellee.

FELL, J. The plaintiff was a freight conductor on the defendant's road, and was injured in a collision alleged to have been caused by the negligence of a flagman who was habitually careless, and of whose incompetence the defendant had notice. The flagman whose conduct was complained of was one of the crew of the plaintiff's train, and under his charge and subject to his orders; and notice of his incompetence had been given to the defendant but a short time before the accident. The plaintiff's road to a verdict was therefore a very narrow one, and its lines were clearly defined in a charge which fully and accurately stated the law, not in mere abstract propositions, but with reference to the testimony so that it could be understood by the jury. The only question now to be considered is whether the case should have been taken from the jury, and we are of opinion that the learned judge was right in submitting it with the instructions which were given. There was testimony from which the jury might have found that the plaintiff was injured without fault on his part, and wholly because of the neglect of the flagman, who was habitually careless, and whose unfitness for the position was known to the defendant long enough before the accident to enable it to procure some one else to take his place. The jury may not have reached the proper conclusion, but the case could not have been withdrawn from them; and, if the verdict was wrong on the weight of the testimony, the remedy was with the learned judge who conducted the trial. He was not asked to grant a new trial, as the rule for that purpose, doubtless fcr prudential reasons, because of the smallness of the verdict, was withdrawn. The judgment is affirmed.

STAUFFER v. PENN MUT. FIRE INS. ASS'N OF LANCASTER COUNTY. (Supreme Court of Pennsylvania. Oct. 1, 1894.)

INSURANCE-BREACH OF CONDITION-ESTOPPEL.

1. Where an insurance policy provides that it shall be void if additional insurance is procured without the consent of the directors at a regular meeting, evidenced in writing, signed by the president or secretary, and plaintiff applies for consent to additional insurance to the board, which had just adjourned, whereupon the president directed such consent to be indorsed on the policy, the company is estopped to deny its consent.

Appeal from court of common pleas, Lancaster county; J. B. Livingston, Judge.

Action by John H. Stauffer against the Penn Mutual Fire Insurance Association of Lancaster County, Pa. There was judgment for plaintiff, from which defendant appeals. Affirmed.

George Nauman and Eugene G. Smith, for appellant. Brown & Hensel, for appellee.

FELL, J. The defendant is a mutual insurance company, and the policy upon which this action is founded contained the following provisions applicable to the question involved: "(1) The company shall not be liable for loss if there is either prior or subsequent insurance without its written consent. (2) A compliance with the terms of the policy shall not be considered waived unless the waiver is in writing, and signed by the president or secretary. (3) The insurance shall cease at the time the property is insured in another company. (4) A member, in order to procure additional insurance without invalidating his policy, shall make application to the company, and the same must be allowed and approved at a regular meeting of the board of directors." The policy was issued to the plaintiff September 3, 1887, and on May 8, 1888, he procured additional insurance in another company. There was testimony to show that at the time the policy was issued the insured told the secretary of the company, who was also a director, that he intended to procure additional insurance, and that as soon as it was procured he notified him of the fact, and went through the building with him, and was told by him that it was "all right," and that he should meet the directors at their regular meeting, and have it fixed. No time was then named, the direction being, "any time you come up." Subsequently, on notice from this director, Mr. Zortman, who had charge of the district in which the insured lived, he went to the office of the company at the time fixed for the meeting of the board of directors. When he reached the office the meeting of the board had adjourned, and three only of the six directors were pres ent, but of this he had no knowledge. At the office of the company he handed the policy to Mr. Zortman, who took it to the presi dent. The president said that he knew all about it, and directed Mr. Zortman to write the necessary consent on the policy. This was done by Zortman, who then showed the policy to the president, who approved it, and it was handed back to the plaintiff. There was no formal action by the board of directors, but there was the written consent which the conditions of the policy required; and, if there was any waiver of the condition, it was expressed in writing, and approved by the proper officer. The condition that the insurance should cease at the time additional insurance was taken must be read in connection with the provision for procuring additional insurance; and what was done fell short of a literal compliance with the conditions only in that there was no formal allowance and approval of the additional insurance by the board of directors as such. The prohibition of additional insurance was of the substance of the contract, and notice of such insurance to a director, and his assent and approval

He

thereof, would not save the policy, as a director has no authority to allow or approve additional insurance. Bard v. Insurance Co., 153 Pa. St. 257, 25 Atl. 1124; Hook v. Insurance Co.,. 160 Pa. St. 229, 28 Atl. 690. But the question here is not whether a director could waive a condition of the policy, but whether the company, because of the acts and declarations of its officers, is now estopped from denying its approval of the additional insurance. The plaintiff, acting in good faith, and intending to comply with all the conditions of his policy, sought information of the executive officers of the company as to what he should do, and fully complied with their directions. He went to the office of the company at the time of a regular meeting of the directors, and was at once asked if he had come in relation to the additional insurance on his property, and was told that they knew all about it, and that it was all right. In his presence the president directed the indorsement of the company's approval to be made. on the policy, and, after it was done, approved it, and returned the policy to him; and he left with the assurance that he had fully complied with the regulations of the company, and that the policy was valid. might well have assumed, if he had chosen to act upon his own judgment of what was necessary to be done instead of relying upon the direction and assurance of the officers of the company defendant, that the board of directors had formally acted upon and granted his application. What was said and done by the officers of the company was equivalent to a declaration that all the conditions had been actually complied with, and estopped the defendant from controverting the fact. In Mentz v. Insurance Co., 79 Pa. St. 475, the policy contained a condition that, if additional insurance was procured, it should be indorsed on the policy, and it was there held that the declaration of a general agent of the company to the insured that the indorsement of the second insurance had been made on the policy estopped the company from objecting to the want of an indorsement; Sharswood, J., saying: "Such a declaration, made by a duly-authorized agent or officer, would clearly operate as an estoppel. It lulled the party to sleep by the assurance that the condition of the policy had been complied with, and that his indemnity was secure." The judgment is affirmed.

Appeal from court of common pleas, Philadelphia county.

Action by Thomas G. Lovegrove, trading as Lovegrove & Co., against J. W. Christman. There was judgment for plaintiff, from which defendant appeals. Affirmed.

A. E. Stockwell and M. Hampton Todd, for appellant. Frank R. Shattuck and Alex. P. Colesberry, for appellee.

The

MCCOLLUM, J. The single question presented by this appeal is whether the learned court below erred in rejecting the defendant's evidence and offers of evidence that, in consequence of the plaintiff's failure to deliver the boiler at the time stipulated in the contract, he lost three months' rent of his building on Broad street. The ground on which the evidence was rejected was that it was inadmissible under the pleadings. learned judge thought, and so held, that in order to introduce an item of this character by way of set-off, recoupment, or equitable defense, the plaintiff should have reasonable notice, by plea or otherwise, of the defendant's intention to present it on the trial as a complete or partial answer to the action. The rule of court in Philadelphia county applicable to this question is as follows: "Any defense, legal or equitable, that might heretofore have been specially pleaded or given in evidence under equitable pleas, shall be admissible under the plea of the general issue, upon notice given at least ten days before the day set for trial. Such notice of special matters of defense shall contain a specific averment of facts sufficient to constitute a good legal or equitable defense. Copies of such notice shall be filed of record, and also served on the plaintiff or his attorney at least ten days before the day set for trial. In default of such notice the defense shall be confined to matters stricuy admissible under the plea filed." As the defendant concedes that his claim for rent was not admissible as a set-off, we need not quote the portion of the rule which relates particularly to that subject. His contention is that it should have been allowed under the plea of non assumpsit and payment. It is well settled that under the plea of payment alone the proof to support it must be confined to matters which were admissible at common law, and which constitute technical payment. If equitable payment is alleged, notice of the matters constituting it must be given. The defendant's rejected evidence was therefore clearly inadmissible under his plea of payment. Was it admissible under the plea of non assumpsit? It related to a lease of the Broad street building to Barber after the contract in question was entered into, to the loss of that lease, the contents of it, and to Barber's abandonment of it. Its purpose was to charge the plaintiff with the loss the defendant alleged he sustained by such abandonment, and to attribute the

averred adequate remedy at law for plaintiffs touching the several complaints in their bill.

The bill was sent to an examiner and master to report testimony and facts and suggest decree. After full hearing, the master found as facts: (1) The sum of $1,200, loaned Sarah E. Stryker by the executor on the first mortgage, was part of the money directed by the will to be invested during the life of the widow, but there was no agreement or understanding that any part of the mortgage was to be satisfied out of her share of the money invested for the widow. (2) That there was no evidence to impeach the bona fides of the assignment to Strieby. (3) That, by the will, Sarah E. Stryker was entitled, at her mother's death, to the one-seventh of $6,000, and the one-seventh of the purchase money of the house and lot, and her whole share of both, he believes, will equal $1,000; but it is impossible to find the amount of assets in the executor's hands at the death of the widow. (4) He fails to find any fraud or collusion between the parties to prejudice Henderson, Hull & Co. As conclusions of law, the master determined: (1) That the legacy to Sarah E. Stryker, under her father's will, vested immediately on his death, its enjoyment being postponed until the death of her mother. (2) That the only legal method of determining the amount of Sarah E. Stryker's share was by settlement of the accounts of the executor, and distribution to the legatees in the orphans' court of Lycoming county; and that, at the death of the widow, the executor held this mortgage, with the other funds of the estate, as trustee for Sarah E. Stryker and the other legatees. (3) That any extinguishment of the mortgage cannot extend beyond the amount due Sarah E. Stryker under the will of her father on a final settlement of the account of the executor in the orphans' court of Lycoming county; that, at the death of her mother, the mortgage was extinguished to the amount of the mortgagor's share in the fund. (4) That Strieby, the assignee, stands in place of the executor, and the mortgage in his hands is subject to the same equities as immediately before the assignment; that the equities of the plaintiffs entitle them to a decree postponing the lien of the first mortgage, and he therefore suggests a decree of postponement in favor of the second mortgage. On exceptions filed to the report of the master, the court, after argument, overruled the exceptions, and made the decree suggested by him, and therefore defendants appeal.

It having been found as a fact that the money loaned Mrs. Stryker on the mortgage was out of the very fund, part of which the executor, under the will, was to pay her at the death of her mother, then, in effect, as to a large part of the loan, she had borrowed her own money, and, by mortgage, secured

the annual interest on the whole to her mother. Therefore, the moment her mother died, by operation of law, the mortgage was paid in an amount equal to the amount of her legacy; and the second mortgage, to that amount, became a first lien on the premises. There was no need of a decree of postponement in favor of the second mortgage, for, to the amount it was paid, there was no lien. To the amount it was not paid, there was no equity in the holder of the second mortgage which could impair the executor's right. To the amount it was paid, he no longer had a right. Nor could the assignment to Strieby, after the death of the widow, give life to so much of the mortgage as was extinguished. The lien of the second mortgage, as to that much, had attached as a first lien at the death of the widow. The right of a third party had vested, which it was not in the power of the executor to divest by an assignment. If the assignment had been made in the lifetime of the widow, no one could have been heard to object to it but Mrs. Stryker; but, as to the part paid at the death of her mother, it had no existence as a debt against her, and therefore was incapable of assignment. Extinguishment is the extinction of a charge or equity by its passing into the hands of the owner of the lands charged. James v. Morey, 3 Shars. & B. Lead. Cas. Real Prop. 228. It takes place when the same hand that is to receive is to pay. That amounts to extinguishment (Wankford v. Wankford, 1 Salk. 305); and the principal is fully stated and applied by Gibson, C. J., in Reigle v. Seiger, 2 Pen. & W. 340.

But how can the court of common pleas, sitting in equity, for Union county, by any decree, measure the value in dollars and cents of Mrs. Stryker's legacy in Lycoming county? The executor and trustee must account in the orphans' court of Lycoming county for the fund. That court must determine the exact balance, and award to Mrs. Stryker one-seventh. By law, another court of another county has full jurisdiction, and this cannot be ousted by a court of equity in Union county. Loomis v. Loomis, 27 Pa. St. 233. It would lead to interminable confusion were such a practice approved. In so far as the decree of the court determines what are the rights and equities of the second mortgagees at the death of the widow it is unobjectionable. But it cannot decree that the lien of the first mortgage be postponed in favor of the second mortgage; for, in so far as the first mortgage is paid by operation of law, there is no lien. In so far as it is not paid, no court can postpone, or in any manner disturb, the clear legal right of plaintiff and his assignee, Strieby. It is argued that the holders of the second mortgage have an equity in asking a decree that will enable them to bid intelligently; but they are not entitled to such decree if the