Appeal from court of common pleas, Lancaster county.

Issues under the sheriff's interpleader act, between A. Hirsch, as plaintiff, and D. H. Wenger & Bro. and another, as defendants, and between M. W. Fraim, as plaintiff, and the same defendants. Judgments for plainJudgments for plaintiffs. Defendants appeal. Reversed in first case, affirmed in second case.

John A. Coyle and D. McMullen, for appellants. Brown & Hensel, J. W. Johnson, and Chas. I. Landis, for appellees.

WILLIAMS, J. These were issues under the sheriff's interpleader act. The facts which gave rise to them are substantially as follows: B. W. Hirsch was the proprietor of a livery stable. D. H. Wenger & Bro. and Christian Reedmiller were dealers in feed, and had been supplying Hirsch with feed for his horses. Finding that they could neither obtain payment of or security for their bills, they brought action against him on the 9th day of November, 1893. Judgments were recovered in these actions on the 25th of the same month; that in favor of Wenger & Bro. being for $980.44, and that in favor of Reedmiller for $1,287.87. Two days after these actions were begun, Hirsch confessed a large judgment in favor of his father. A writ of fi. fa. was issued on the same day, and without much loss of time the horses, harness, wagons, and other personal property comprising the livery establishment were seized, brought to sale by the sheriff, and sold to the plaintiff in the writ, the father of B. W. Hirsch. The amount of the judgment confessed, the relationship of the parties, the time when the judgment was entered, and the circumstances surrounding the sale were, to say the least, suggestive. The defendants in these cases issued writs of fi. fa. on their judgments as soon as they were revived, and levied on the same property, kept at the same livery stable. At the sheriff's sale the father appeared, and claimed the property as his by virtue of the sheriff's sale made to him on his own judgment. These issues were framed to determine the bona fides of his judgment and the validity of his title.

The allegation of the defendants was that the confession of judgment by B. W. Hirsch to his father, and the subsequent proceedings upon it, were a fraud, intended to hinder and defeat the collection of the debts due them. They depended upon circumstances for the support of this allegation. Among other things, they sought to show that the father was not of sufficient pecuniary ability to furnish his son the amount of money claimed, that he was pressed during the time when the alleged advances were being made for money with which to pay his taxes, that his real estate was heavily incumbered, and that he was actually insolvent. If this proof had been admitted, as we think it should have been, the burden would have been on the father to establish to the satisfaction of the jury that he had the

money he claimed to have advanced to his son; that he did advance it in good faith; and that it was unpaid, and honestly due, when the judgment was confessed. The door should have been opened for an investigation of the alleged fraud, and latitude allowed in examining the circumstances surrounding the alleged advances. Railroad Co. v. Hoge, 34 Pa. St. 214. The principle laid down in Glessner v. Patterson, 164 Pa. St. 224, 30 Atl. 355, is applicable to this case. The straitened circumstances of the father was a fact having an important bearing upon the bona fides of the alleged indebtedness. If his debts and the pressing demands on him for money were such as to render it improbable that he could have raised and advanced to his son the sums claimed at the time when he asserted it had been done, this went strongly to affect the credibility of his testimony, and sustain the allegation of fraud. The second, third, fourth, and seventh assignments of error are sustained. The fifth and eighth assignments appear to be to rulings, not turning on the manner of proof offered, but on its relevancy. We think the proof was relevant. The defendants, under the peculiar circumstances of this case, had a right to show the insolvency of A. Hirsch at the time when he alleged he was advancing large sums of money to a son who was also a bankrupt, and utterly unable to return the money so advanced. Some of the questions raised by the other assignments may become important upon another trial. This is especially true of that raised by the ninth assignment. If, as is alleged, there were large judgments and debts not of record, due from the plaintiff, and he was without property sufficient to pay them, this made a case of actual insolvency which would have been a strong reason for treating the judgment against the son and the sale by the sheriff of the stock of the livery stable upon the fi. fa. as contrived and executed for a fraudulent purpose. The judgment is reversed and a venire facias de novo awarded. In the other cases in which Fraim was plaintiff in the court below we see no sufficient reason for disturbing the judgment, and it is accordingly affirmed.

UNION WATER CO. et al. v. BOROUGH OF ROCHESTER et al. (Supreme Court of Pennsylvania. April 12, 1897.)

BOROUGHS-PROVIDING WATER FOR INHABITANTS → INJUNCTION-DIVISION OF Costs.

1. A borough which, under General Borough Act April 3, 1851 (P. L. p. 320, § 2, subd. 20). empowering it to provide a supply of water for the use of the inhabitants, and to make needful regulations for protection of pipes and reservoirs. and to prevent waste of water so supplied, may either construct its own water works, or adopt other means for supplying water, executes its power (which it has by virtue of the statute only) by authorizing a water company to lay its pipes and erect hydrants in its streets, subject to the approval of the borough engineer, and contracting

comes due after the maturity of the principal. And if compound interest is required by a mortgagee, and paid under protest by one claiming under the mortgagor, in order to prevent the expiration of the right of redemption, the mortgage having been foreclosed, it may be recovered by the person who paid it under such circumstances.

2. The fact that a demand is made for the interest when it becomes due does not affect the question. Upon an indebtedness without interest, payable at no particular time but upon demand, a demand is necessary to make the indebtedness due, and interest only begins to run from the time of maturity; but a demand does not affect the matter of interest where the debt is payable at a definite time.

3. The general rule is that whenever the debtor knows what he is to pay, and when he is to pay it, he shall be charged with interest if he neglects to pay. The only reason why this rule does not apply in the case of interest due at a stipulated time, and unpaid, is because the law regards it as against public policy to allow a creditor to recover compound interest.

4. When a mortgage is foreclosed by publication, one who is entitled to redeem must, before he can do so, pay the necessary expense of such foreclosure. This includes the amount paid for publishing the notice of foreclosure in a newspaper, and the recorder's fee for recording the same. 5. But the amount paid an attorney for professional services in such matters, however wise such employment may be, and sometimes almost absolutely necessary, is not legally a necessary expenditure. Therefore the person entitled to redeem is not obliged to pay it. (Official.)

Agreed statement from municipal court of Western Hancock.

Assumpsit by John F. Whitcomb and others against Amy Eddy Harris. Submitted on an agreed statement. Judgment for plaintiffs.

This was an action of assumpsit, brought in the Western Hancock municipal court, to recover money claimed to have been paid by the plaintiffs to redeem from a certain mortgage, held by the defendant, in excess of the amount actually due upon said mortgage. The case was certified by the presiding justice to the law court for decision upon the following agreed statement:

The defendant in this action was the owner and holder of a certain mortgage upon real estate in Bar Harbor, Eden, Me., given by Lucy A. Barron and George A. Barron to James Eddy, to secure a negotiable promissory note for the principal sum of $3,000, as follows:

ers of a subsequent or second mortgage upon the same property covered by said mortgage of the defendant, demanded of the defendant, through her attorneys, Messrs. Deasy & Higgins, a true account of the sum due upon her said mortgage, which statement the defendant rendered to the plaintiffs, claiming as due on her said mortgage, January 3, 1893, the sum of $3,469.30, as follows: Principal, $3,000; interest, $454.80; costs of foreclosure, $14.50. The plaintiffs, to save a forfeiture, paid said sum of $3,469.30, as of said January 3, 1893, under protest, in writing, claiming that it was in excess of the real amount due under the mortgage, and notify. ing the defendant that an action would be instituted to recover such excess. The defendant took said sum of $3,469.30, insisting that she would not discharge the mortgage for any less amount, and thereupon executed and delivered to the plaintiffs a discharge of the mortgage, and also delivered to the plaintiffs the mortgage note.

It was admitted that the defendant, in fixing the amount due upon said mortgage, computed interest upon all overdue interest at the rate of 6 per cent. per annum. The item of $14.50, costs of foreclosure aforesaid, was made up as follows:

Paid attorneys for legal services, consisting of drafting foreclosure notice and attending to publication and recording of same, $10;

paid for publishing and recording, at regular

rates, $4.50.

It was also agreed that, when the interest fell due, the mortgagee wrote and mailed, postpaid to the mortgagors, a letter demanding payment of the interest, which letter was directed to the mortgagors at their regular post-office address. Such letter was mailed when the interest fell due, both in 1891 and 1892. But the plaintiffs, at the time of paying the mortgage, had no knowledge of such demand having been made.

H. E. Hamlin, for plaintiffs. L. B. Deasy, for defendant.

WISWELL, J. The defendant was the owner of a mortgage upon certain real estate, to secure a note for $3,000, dated August 3, 1886, payable in four years from date, with interest at 6 per cent. per annum, payable annually. Interest upon this note had been paid in full to August 3, 1890, the time of its maturity, but had been unpaid since that time. The defendant had commenced a foreclosure of the mortgage for breach of its condition, and the right to redeem would have expired upon January 7, 1893. Shortly before that time, the plaintiffs, owners of a subsequent mortgage upon the same premises, demanded of the defendant a true account of the amount due upon the mortgage. She rendered an account, claiming that there was due on January 3, 1893, the sum of $3,469.30, which sum included, in addition to principal and interest thereon, interest upon

the overdue interest at 6 per cent., from the time that the same had become due, and the costs of foreclosure, consisting of $4.50 paid for publishing and recording notice of foreclosure, and $10 paid for counsel fees.

The defendant refusing to accept less than the above sum, the plaintiffs paid it under protest, to prevent the mortgage from becoming fully foreclosed, and in this action seek to recover the amount which they claim is in excess of the sum that the defendant was entitled to.

That the action may be maintained if the defendant has received more than she is entitled to retain is conceded. Rev. St. c. 90, § Rev. St. c. 90, § 22.

The first question raised is whether the defendant was entitled to interest upon the overdue annual interest which became due after the maturity of the note, a demand having been made for the same when it became due.

There has been much diversity of opinion in the courts of this country upon the question as to when and under what circumstances, if at all, compound interest can be recovered; some courts holding that interest upon interest can never be recovered, and that an express promise, made at the time of the original contract, to pay interest upon any interest that may not be paid in accordance with the terms of the contract, is invalid, because iniquitous and against public policy; while others have laid down the rule that overdue interest will carry interest from the time of default, without any promise or demand therefor.

However much force there may be in the argument that a debtor who has agreed to pay at stipulated times interest upon money loaned should, in case of his default to pay in accordance with his contract, be liable to pay interest, at the rate fixed by law, as damages, upon the sums which he ought to have paid, we think that so far as interest becoming due after the maturity of the principal sum is concerned, at least, the question is not an open one in this state. As to whether there is any difference in the rule when interest is sought upon annual or semiannual interest that became due before the maturity of the principal, need not be here considered.

The first case upon the subject in this state, and one which has been very frequently cited with approval here and elsewhere, is that of Doe v. Warren, 7 Greenl. 48, in which it was decided that the law does not allow interest upon interest, not even where a promissory note is made payable with interest annually. In that case, speaking of interest, it is said: "It is an accessory or incident to principal. The principal is a fixed sum; the accessory is a constantly accruing one. The former is the basis or substratum from which the latter arises, and upon which it rests. It can never, by implication of law, sustain the double character of principal and accessory."

In Bannister v. Roberts, 35 Me. 75, it is

said: "When a note is made payable with interest annually, whether by installments or not, the interest accruing before the whole of the principal becomes payable may be collected, if a suit be commenced to recover it before the whole of the principal becomes payable. payable. If no suit be commenced for that purpose until after that time, interest upon interest not paid, from the time when it should have been paid, cannot be recovered in a suit for the principal and interest due upon the note."

In Kittredge v. McLaughlin, 38 Me. 513, it was decided that compound interest cannot be reckoned upon proceedings in equity to redeem a mortgage to secure notes on annual interest, in estimating the amount due. See, also, to the same effect, Lewis v. Small, 75 Me. 323.

But it is true, as urged in argument, that in none of these cases had there been a demand for the interest. We do not think that this affects the question. Upon an indebtedness without interest, payable at no particular time, but upon demand, a demand is necessary to make the indebtedness due, and interest only begins to run from the time of maturity; but we do not think that a demand affects the matter of interest where the debt is payable at a definite time. The general rule is "that, whenever the debtor knows what he is to pay and when he is to pay it, he shall be charged with interest if he neglects to pay." People v. New York, 5 Cow. 331, quoted with approval in Swett v. Hooper, 62 Me. 54. And the only reason why this rule does not apply in the case of interest due at a stipulated time, and unpaid, is that the law regards it as against public policy to allow a creditor to recover compound interest.

In the case of Parkhurst v. Cummings, 56 Me. 155, this court adopted a much more stringent rule than it is necessary to sustain in this case. A mortgage was given to secure a note with interest annually. After the note had been running many years, the mortgagor gave a new note for the accumulated interest upon the first note, and made that with interest annually. In a bill in equity to redeem, brought by the holder of a junior mortgage, the holder of the first mortgage claimed interest upon the interest note, as well as the unpaid interest upon the original principal; but the court held that the holder of the second mortgage was entitled to redeem upon payment of the original note and simple interest thereon, notwithstanding the fact that the mortgagor had given a second interestbearing note for the accumulated interest on the first note.

In view of these authorities, the court is of opinion that the defendant was not entitled to retain the interest upon interest which was paid by the plaintiffs.

This mortgage was foreclosed by publication, one of the methods provided by law. The statute is silent as to whether one who is entitled to redeem must pay the costs of a