Warner's Appeal

Opinion by Mr. Justice Paxson : Nearly all of the assignments of error in this case are to the finding of the learned auditor upon questions of fact. His findings were approved by the court below. The testimony occupies nearly 1,000 pages. The report of the auditor is elaborate and goes over the case very fully and carefully. If there are any serious errors in his findings, they have not [314] been pointed out to us, and this is a condition precedent to our taking up this vast mass of testimony for''the purpose of reviewing it. The report of a careful auditor upon the facts approved by an experienced judge must go for something. They must be permitted to stand until plain error is pointed out. There is not much else in the case. What little there is may be considered in connection with the 9th, 10th, and 11th assignments'. The 9th is as follows: “The court below erred in overruling plaintiff’s llth exception to the master’s report, to wit: the master erred in not recommending a decree requiring defendants to deliver to plaintiff all of the notes in exhibit A now in their possession, and to pay to him the proceeds of such as have been collected by them.” The master has found, and the fact is not denied, that the defendants below have possession of about $450,000 of the bills receivable of the bank, which they hold as indemnity for $289,000 of paper issued by them for the accommodation of the hank, and which paper was discounted by other banks and brokers, and the proceeds paid into the vaults of the Penn Bank. This transaction appears to have been done in entire good faith, and with the hope and for the purpose of enabling the bank to resume payment successfully. There is nothing in the case to connect the directors, defendants, with the great fraud by which this institution has been wrecked. They may have reposed too much confidence in the officers of the bank, but they did not steal its money. The cas° itself does not raise any question of their negligence. It is conceded that, when these securities were selected, set apart, and handed over to the defendants, they took a good title thereto. But it is alleged that on the following Monday the said securities were so mingled with other securities of the bank that they could not be identified, and the doctrine of confusion of goods was mooted to destroy the defendants’ title to the notes. It is at least doubtful whether the doctrine referred to is applicable to such a case, and, even if it were, the master has found no facts to which it could be applied. He has found that there was no mingling whatever, and we think he is sustained by the evidence. The securities passed over by the hank to the defendants to indemnify them for raising this loan of $289,000, inured in law to the benefit of the other banks advancing the money. This is [315] settled law. Kramer’s Appeal, 37 Pa. 71; Rice’s Appeal, 79 Pa. 168. They are entitled to the full benefit of the securities. They have done no act which would justify a court of equity in forfeiting their rights. Much stress was laid upon another point, — a number of small bills, called the “foreign bills,” in some way were exchanged and are now in the list held by Mr. Hare for the defendants. They amount altogether to $2,460.47. How this occurred does not very clearly appear. They do not increase the amount set apart for defendants. Other notes were received therefor by the bank, which the master finds of equal value. He further finds that no one was injured by the exchange and no fraud was intended. We are asked to declare that these “foreign bills” at least are forfeited, and that they belong to, and must be returned to, the bank. But those who ask equity must do equity. The bank received notes of equal value and amount in this exchange, and those notes must be returned before equity will interfere. It would be a harsh rule to deprive the creditor banks of a security upon which they practically loaned their money, for a mere blunder of this kind, for which they were in no way responsible, and occurring at a time when there was great excitement and confusion at the bank. Aside from this, the bank gets, the benefit of these notes. They, all go to pay its debts, and whatever surplus there may be after paying the notes for which they were specifically pledged will go to the assignee for the benefit of the bank’s creditors. The 11th assignment relates to the question of costs. The master and the court below put them on the fund realized on the bills specified in exhibit A, after the payment of the notes on which the defendants are liable. This was practically charging the costs upon the assigned estate, where its property belongs. If the bills in exhibit A should produce no surplus, the order as to costs can be modified by the court below so as to charge them directly upon the estate. There is no merit in this assignment. The decree is affirmed and the appeal dismissed, at the costs of the appellants.