87 Pa. 120 | Pa. | 1878
delivered the opinion of the court,-
Adam K. Witmer became the trustee of David Conyngham, under a bequest in the will of Mrs. E. Y. Conyngham, which was proved on the 6th of August 1864, and under an instrument executed by the cestui que trust himself, on the 7th of January 1868. The entire fund amounted to $20,657.33, of which the sum of $12,000 was invested in the Pennsylvania State Loan of 1867, on the 9th of March 1868. On the 16th of March this investment was approved by the Court of Common Pleas of Lancaster. The bonds were deposited in the Farmers’ National Bank of Lancaster, and the interest was drawn by its cashier. In the exercise of the option reserved to the state, the loan was paid on the 1st of November 1875. The auditor has reported that actual notice of this payment was not received, either by Mr. Witmer or the cashier of the bank, until after the 1st of February 1876. Of necessity, interest ceased to accrue when the loan was redeemed, and for three months, therefore, the fund was unproductive. Receiving the money in
No doubt can be entertained of the accuracy of the facts found by the auditor. It is true that Mr. Conyngham testified that in August 1875, he gave to Mr. Witmer a notice he had cut from a newspaper of thé payment of the loan. But he added that it was declared to be payable to the Merchants’ and Mechanics’ Bank of Philadelphia four days after the date of the notice in the paper. In its inherent features, this testimony was unreliable. No notice of payment within four days could have been given, and the name of the bank was mistaken. Mr. Witmer’s statement was positive that he had no knowledge that the loan was to be paid off. And it is not credible, if Mr. Conyngham’s recollection was accurate, that he would have received, and his trustee would have paid, on the 8th of February 1876, the whole interest for the preceding six months, without inquiry or remark. It does not, perhaps, bear on this question that the excess paid over was returned on the 30th of June 1876, as the amount was simply retained out of the proceeds of other investments in the trustee’s hands. The testimony of the cashier of the Farmers’ National Bank that he had no knowledge of the payment of the loan, was also positive and distinct. '
In considering the propriety of the decree of the Common Pleas, the apparent fact is to be taken into account that the interest with which he was surcharged had never been received by the trustee. Was his failure to collect the fund for three months, and to reinvest it during two months more, such an omission as ought to be characterized as supine negligence or wilful default ? It has not been discovered that his place of residence at the time when the loan was paid off was proved, but it appears from his testimony that he was carrying on a commission, transportation, coal and lumber business at Paradise, in Lancaster county. He received and read the Philadelphia “North American,” and two local newspapers, and they furnished him no information on this subject. The auditor found he had no actual notice, and the question is presented, whether he was blameable for failing to discover the advertisement in the papers which the state officers selected for its publication ? The bonds were in the custody of a bank cashier, who had authority to collect the interest. The trustee would naturally
A single point remains to be considered. The appellant received the money paid by the state in February, and retained it without reinvestment until after the 1st of April. The auditor charged him with interest from that date, and to this interest during the intervening period was added by- the court. The financial condition of the country since 1873 has been such as to create distrust and inspire caution in the minds of business men of all classes, and in relation to securities of every grade. The report has shown that the 1st of April is the usual time for making investments in mortgages on real estate in Lancaster county. In Worrell’s Appeal, 11 Harris 44, the Orphans’ Court of Philadelphia had allowed a guardian but a single month from the date of their receipt for investing the moneys of his ward. In the opinion of this court, Judge Knox said: “We have, in several recent cases, held that, ordinarily, six months should be allowed for this purpose.” From subsequent decisions, however, it would seem that the time should be such as the circumstances of each particular case would show to be reason
The decree of the Court of Common Pleas is reversed, and it is ordered that the report of the auditor be confirmed.