172 Pa. 629 | Pa. | 1896
Opinion by
This proceeding is founded upon a petition by Samuel Mus-grave, one of the sureties on a replevin bond, for subrogation to the rights of the plaintiff in the judgment. An answer was filed by the appellant, the plaintiff, in which he averred that the judgment had not been fully paid, and in which he stated other supposed equitable grounds in denial of the right claimed. A separate answer was filed .by the defendants, in which they alleged that they had transferred their property and business to the co-surety, J. C. Dicken, to secure him and Samuel Mus-grave from any loss they might sustain by reason of the bond, and that from the management of their business an amount had been realized by Dicken more than sufficient to cover the payment made by Musgrave. It was agreed by both sureties that the amount due the defendants from the management of the business should be credited by Musgrave on account of the money which he had paid. The issues thus raised were referred to a commissioner. The terms of the reference do not appear from the record, but it is stated in the appellee’s history of the case that the commissioner was “to take testimony and find the facts in issue by the petition and answers.”
The commissioner having taken and considered the testimony reported that the defendants, after the allowance of all proper credits, were indebted to the petitioner in the sum of $872.70, and to this amount subrogation was ordered by the court. A large part of the testimony has not been brought up with the record. From an examination of what appears we see no reason to doubt the correctness of the conclusion reached either as to the obligation to account or as to the amount due. The issue raised by the answer of the plaintiff seems to have been wholly ignored. Whether any testimony was taken under this issue we are not informed. None appears with the record. Its omission would be ground for the affirmance of the order if there was a finding and report by the commissioner. Neither has been made. In the whole proceeding as it is presented no reference is made to this issue from the time it is raised by petition and answer until it is finally disposed of by the order making absolute the rule to show cause why subrogation should not be allowed. Its importance may have been an afterthought, but the issue is one which cannot now be disregarded. It is.
Subrogation rests upon purely equitable grounds, and it will not be enforced against superior equities. 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: Dering v. Earl of Winchelsea, 1 Leading Cases in Equity, 120; Kyner v. Kyner, 6 Watts, 221; Bank v. Potius, 10 Watts, 148; Hoover v. Epler, 52 Pa. 522; Allegheny National Bank’s Appeal, 19 W. N. C. 78. The settlement of the account between the sureties and the defendant fixed the amount of the liability of the latter and the extent of the right to indemnity, but it did not affect the right of subrogation, which will never be allowed to the prejudice and injury of the creditor.
The judgment is reversed and the record is remitted to the court of common pleas in order that there may be a finding upon the issue raised by the answer of the appellant.