
    Wolfgang v. Shirley, Appellant.
    
      Judgment — Judgment note — Accommodation note.
    
    1. A judgment entered on a judgment note under seal will not be opened where it appears that the defendant signed the note without its being dated, and with no name written therein as payee, and delivered it to an attorney at law, for the latter’s accommodation, and the latter filled in the name of a client from whom he had received money for investment, which he had himself appropriated, and the client .upon notice of the existence of the note in her favor, and in reliance upon it in part, ratifies the loan which the attorney had made to himself from her moneys.
    2. If one by his acts, or silence, or neglect, misleads another or in any way effects a transaction whereby an innocent person suffers loss, the blamable party must bear it.
    3. The court to which application is made to open a judgment, may judge the weight of the evidence and the credibility of the witnesses and is not bound even where there is a conflict of testimony, to send the case to a jury. The whole proceeding resolves itself into the exercise of a sound judicial discretion.
    Argued May 7, 1912.
    Appeal, No. 46, April T., 1912, by defendant, from order of C. P. Clarion Co., Dec. T., 1911, No. 180, discharging rule to open judgment in case of Margaret Wolfgang v. John S. Shirley.
    Before Rice, P. J., Henderson, Morrison, Orlady, Head and Porter, JJ.
    Affirmed.
    Rule to open judgment.
    Wilson, P. J., stated the facts to be as follows:
    The judgment in controversy was entered November 25, 1909, on a promissory note with warrant of attorney to confess judgment, waiving exemption and inquisition and with five per cent attorney’s commission for collection, dated at Clarion, Pa., April 18, 1908, payable to Margaret Wolfgang or order at the office of J. A. F. Hoy for $800, with interest and exchange, without defalcation for value received and signed under seal by Jno. S. Shirley.
    On December 16, 1909, a rule to show cause was issued on the petition of the defendant to open the judgment. In this petition the defendant alleged that at the time he signed the note in controversy the date and the name of the payee was blank and that he signed and gave the note to Mr. Hoy on his request for the purpose of enabling Mr. Hoy to raise money on the note for his own use and that it was understood between them that the note should be negotiated at one of the three banks in Clarion; that the said Floy was not authorized by the petitioner to negotiate the note to Margaret Wolfgang; that he had never received in any way the said sum of $800 or any part thereof and that the note was wholly without consideration as to the petitioner; that the said Hoy was the agent and attorney of Margaret Wolfgang for the purpose of loaning her money; that on April 18, 1908, he had in his hands as her agent $855.73 and on April 24,1908, the said Hoy assigned to Margaret Wolfgang $800 of his judgment against W. F. Stover and guaranteed payment of the same; that under date of April 24, 1908, and received by Mrs. Wolfgang not later than May 21, 1908, her agent, Mr. Hoy, wrote and mailed to her the following letter:
    “Mrs. Margaret Wolfgang, Dear Madam — I enclose a statement of a judgment of which $850 has been assigned to you. In addition to the security of this judgment, I have for you a note of J. S. Shirley for $800 that is given instead of bail for the party against whom the judgment is held, and in addition to that in making the assignment of part of the judgment I personally guaranteed the same by writing on the docket. Mr. Slicker sent your check which was for $855.73, and I enclose check for the balance, $5.73.
    “ While there is no provision to that effect I will have the party pay the interest every six months.
    “ Very truly yours,
    “ J. A. F. Hoy.”
    On January 6, 1910, the plaintiff filed her answer to the rule and averred in substance, inter alia, that the facts contained in the petition were insufficient to open the judgment; she denies that the note was signed in May or June, 1908, but avers that it was signed on or before April 24, 1908; she avers that she did not give any authority to the said Hoy to use any of her money or to loan the same to himself, but that on the strength of the note in controversy being given to her she did ratify and approve of the matter in accordance with the letter from Mr. Hoy to her dated April 24, 1908; she also avers that Mr. Hoyhad authority to write in the blank space left by the defendant on his signing the note the name of the payee from whom he might receive the money, and that the allegation of the defendant that the note was without consideration as to him is immaterial for the reason that the note was signed by him for the purpose of permitting Hoy to raise money for Hoy’s use; she further avers that she did not have any knowledge of any understanding between Hoy and the defendant that the note was to be used by Hoy at one of the three banks in Clarion; she further avers that at the time she permitted Hoy to retain $850 on the terms set forth in his letter to her of April 24, 1908, she did so with the belief and on the strength of the fact that as security therefor Mr. Hoy held for her a note from Jno. S. Shirley in the sum of $800.
    The defendant has offered testimony tending to show that J. A. F. Hoy received $850 from Mrs. Wolfgang; that he, Hoy, made two payments of $24.00 each on the interest; that the note in controversy was found by Lewis Collner, Esq., law partner of Mr. Hoy, among the papers of Mr. Hoy after his death and delivered by Mr. Collner to Margaret Wolfgang; that Mr. Collner spoke to Mr. Shirley about the note; he, Shirley, claimed to have a paper from Mr. Hoy that he, Shirley, would not have to pay the note; that he, Shirley, made search for the paper in his office and could not find it, but afterwards remembered that he had returned the paper to Mr. Hoy; that Mr. Shirley did not really admit that he signed the Wolfgang note but he did not deny signing a note for Mr. Hoy to Mrs. Wolfgang and claimed that he had a paper in the safe to show that he was not to pay it. John S. Shirley, the defendant, also testifies, inter alia, that when he signed the note the date thereof and the name of the payee was in blank and that he signed it for Mr. Floy, to, enable him to raise money thereon and that it would be negotiated át one of the three banks in Clarion, and that he, Mr. Shirley, never received any money for or on account of the note from Mr. Hoy or any other person, and that Mr. Hoy had no authority from him to write the name of Margaret Wolfgang in the note, and that he, Hoy, had no authority to negotiate the note to any person except to one of the three banks in Clarion. The testimony of Mr. Shirley is uncorroborated as to the declarations at and before the note was signed as to the date, payee, or its use by Mr. Hoy.
    Messrs. Shirley and Hoy were members of the Clarion county bar. Mr. Hoy died September 19,1909.
    It is conceded that the judgment of J. A. F. Hoy against W. F. Stover at No. 149, May Term, 1908, of which $800 was assigned to Margaret Wolfgang, is worthless. The testimony in this case does not show whether the personal guarantee of Mr. Hoy on this assignment is worth anything or not. Mr. Hoy acted in a dual capacity. In the first instance he was the agent of Margaret Wolfgang and authorized by her to loan $850; he had, however, no authority from her to make this loan to himself, although she ratified it after she received the letter from him dated April 24, 1908, inclosing a statement of the Stover judgment and also stating that in addition to the security of this judgment personally guaranteed he also had for her a note of J. S. Shirley for $800. The copy of the assignment on record shows that the amount assigned of the Stover judgment was $800. The relation of Mr. Hoy to Mr. Shirley was that of a friend and fellow member of the bar.
    The whole transaction would indicate that Hoy received the $850 from Mrs. Wolfgang and used it for his personal benefit and that Mr. Shirley received no part of the loan from Mrs. Wolfgang, but that he gave the note to Mr. Hoy for his accommodation with the name of the payee blank and that Mr. Hoy sent this note to Mrs. Wolfgang as additional security to the assignment of the Stover judgment, and that the first notice or knowledge Mrs. Wolfgang had that her money had been loaned was the.letter received from Mr. Hoy dated April 24,1908, and when she ratified the loan the note in controversy was one of the inducing causes of her ratification.
    
      The court citing: Janes v. Benson, 155 Pa. 489; Weigley v. Conrade, 132 Pa. 147; Wetter v. Kiley, 95 Pa. 461, and Stevenson v. Henning, 34 Pa. Superior Ct. 184, discharged the rule to open judgment.
    
      Error assigned was the order of the court.
    
      George F. Whitmer, for appellant.
    — No one can profit by the fraud of his agent: Eilenberger v. Ins. Co., 89 Pa. 464; Stevenson v. Henning, 34 Pa. Superior Ct. 184; De Turck v. Matz, 180 Pa. 347.
    The ratification of an unauthorized act by an agent makes it the act of the principal. This being the case plaintiff must ratify the whole matter. She cannot ratify that part of the transaction which is for her benefit and repudiate his authority or his fraud: Hughes v. Bank, 110 Pa. 428; Keough v. Leslie, 92 Pa. 424; Riddle v. Hall, 99 Pa. 116; Cloud v. Maride, 186 Pa. 614.
    A judgment on a note given without consideration may be opened: McMahon v. McMahon, 203 Pa. 16.
    The note in suit was not negotiable. Had Hoy written his own name in it could have passed only by assignment and that assignment would convey to the assignee only that which the payee was entitled to receive from the maker, after a full settlement of all accounts and equities between them: Rousset v. Insurance Co., 1 Binney, 429; Rider v. Johnson, 20 Pa. 190.
    
      A. A. Geary, with him Corbett & Rugh, for appellee.—
    By signing the note with the name of the payee in blank and giving same to Mr. Hoy to enable him to raise money thereon, Shirley gave Hoy authority to fill out the blank spaces therein: Wessell v. Glenn, 108 Pa. 104; Hess v. Gerstlauer, 214 Pa. 10.
    The note in suit being under seal, want of consideration is no defense: Cosgrove v. Cummings, 195 Pa. 497; Neil v. Neil, 25 Pa. Superior Ct. 605.
    
      July 18, 1912:
   Opinion by

Orlady, J.,

On April 18, 1908, Margaret Wolfgang gave to John Slicker her check for $855.75, with instructions to deliver it to J. A. F. Hoy, an attorney of the Clarion county bar, now deceased, for the purpose of investment for her. The attorney deposited the check in bank to his own credit and applied the proceeds to his own use. A short time subsequently, Hoy procured from Shirley a judgment exemption note for $800 under seal, which was undated and with no name written thereon as payee, for his— Hoy’s — accommodation, Hoy stating that he needed the money to pay insurance premiums on his life, which would shortly become due. After Hoy’s death this note was found among his private papers, with the name of Margaret Wolfgang written thereon as”payee in Hoy’s handwriting, and was delivered by his law partner to the plaintiff, who entered judgment thereon November 25, 1909. A petition was presented to the court reciting the circumstances alleged as inducing causes to securing of the signature of Shirley, and prayed that the judgment be opened and he be let into a defense, which was denied by the court.

The farthest the defendant can urge his claim for equitable relief is founded upon his own carelessness and negligence in issuing a note under his hand and seal, and in blank as to date, or payee, and assuming that it was to enable Hoy to raise money through a bank for his own use, it was but accommodation paper given by Shirley to Hoy, and so far as the subsequent holder is concerned, it was not clouded with any restrictions or suggested defects.

It is not questioned that Hoy owed Mrs. Wolfgang, and that as her debtor he attempted to secure to her the amount of her claim against him. So far as Shirley’s relation to the note is concerned, she is an innocent party who ratified the loan to Hoy partly on the faith and credit of Shirley’s note. “The equities of the respective parties are not equal; where one of two parties, who are equally innocent of actual fraud, must lose, it is the suggestion of common sense as well as equity, that the one whose misplaced confidence in an agent or attorney has been the cause of the loss shall not throw it on the other:” Penna. R. R. Co.’s Appeal, 86 Pa. 80; Shattuck v. American Cement Co., 205 Pa. 197.

It is conceded that Shirley executed and delivered- the note for the express purpose of enabling Hoy to raise money on it, to be applied to his, Hoy’s, own use. It is also shown that the very purpose of that transaction was fulfilled in Hoy’s securing the money or its equivalent from Margaret Wolfgang, and served the very purpose that Shirley intended that Hoy should accomplish, and as said-in Weigley v. Conrade, 132 Pa. 147, “In this respect the bond resembles accommodation paper given by one person to another to enable him to raise money thereon. It has been repeatedly held that want of consideration cannot be set up against such paper, even though the holder knew that it was made for the accommodation of the payee, for the reason that the object of issuing it was to raise money thereon.” In this case Shirley emphasized the value of the paper by importing a consideration to it with his seal.

In Story’s • Equity Jurisprudence, 286, it is declared, “If one by his acts, or silence, or neglect, misleads another or in any way effects a transaction whereby an innocent person suffers loss, the blamable party must bear it.” To allow the promises of Hoy with Shirley to destroy the consideration of the note, and by his oath alone, would be not only correcting or reforming a written instrument by making it read different from what it is in fact, but would be destructive of the very terms of the paper as issued by the maker. “The instrument itself is evidence against him, and, therefore, both upon reason and authority, he must overcome the prima facie presumption arising from his own act, and establish his allegations by the quantum and character of proof required to move a chancellor to make a decree in his favor, or be -left where he has placed himself under the law:” Shannon v. Castner, 21 Pa. Superior Ct. 294.

The court, to which application is made to open a judgment, may judge the weight of the evidence and the credibility of the witnesses, and is not bound, even where there is a conflict of testimony, to send the case to a jury. The whole proceeding resolves itself into the exercise of a sound judicial discretion: Augustine v. Wolf, 215 Pa. 558.

On review of the whole record we affirm the judgment.

Rice, P. J., and Morrison, J., dissent.  