On December 11, 1909, The Lancaster Held, that the defendant could pay, the Court of Common Pleas of York county, Trust Company issued execution in the $10,000 judgment first out of the proceeds of the Lancaster County sale, thus absorbing the on a judgment held by it against the proceeds of both sales for its judgments and said Milton Kindig, for $3,000.00, which

was entered in that county to October | at the time of the sheriff's sale, and Term, 1906, No. 358; and, by virtue thereof, the Sheriff of York county then levied upon certain real estate, situated in York county, and on January 3, 1910, sold the same for $7,750.00. The net proceeds of the sale were $7,617.66. At the time of this sheriff's sale, the liens upon the real estate in York county, according to their priority, were as follows:

priated the fund to the judgments in the | he pleases first (if one is not sufficient order of their lien. to pay his debt), but when the money is brought into court, and there are contending claimants, it will be distributed according to equity." In Shimp's Assigned Estate, 197 Pa., 128, the Supreme Court held that "the doctrine that, where a creditor has a lien on two funds of his debtor, and another creditor has a subsequent lien on only one of these funds, if the prior lien creditor resorts to the fund common to both liens and consumes it, the other creditor shall be subrogated to the rights of the first creditor in the other fund, is a doctrine. of purely equitable origin, and will never be decreed where it works an injustice."

It would seem to us not necessary, when the money realized from the sale of the Lancaster county land was paid over, that the Trust Company should have actively appropriated the fund to a specific lien, in order to secure the most advantage to itself. It was entitled to the fund in any event, upon either the one or the other of its judgments, and it is now asserting the manner in which it did appropriate it. In McDevitt vs. Hays' Appeal, 70 Pa., 373, Agnew, J., says: "Universal practice and numerous authorities prove that the sale and receipt of the money by the sheriff are not per se a satisfaction of any particular encumbrance, though the lien of it may be extinguished. Hence it has been held over and over again that a creditor having two funds subject to his encumbrance, may pass the first by and come in upon the second for payment; a thing he could not do were the fund first brought into distribution a satisfaction of his debt. Whether he will be permitted to do this, or, having done it, whether a junior encumbrance will be permitted to stand in his place by subrogation, will depend upon the equities among the lien creditors which ought to prevail." See, also, Bank of Pennsylvania vs. Winger, 1 Rawle, 795; Addams vs. Heffernan, 9 Watts, 529; Hastings' Case, 10 Watts, 303; Ziegler vs. Long, 2 Watts, 205; Konigmacher vs. Brown, 14 Pa., 269; City of Philadelphia vs. Cooke, 30 Pa., 56. In Horning's Executors' Appeal, 90 Pa., 388, where a property was sold under a judgment obtained on a mortgage, and a creditor whose judgment was a first lien upon the property sold and several other properties of the debtor voluntarily declined to take the money and allowed it to be applied to the mortgage, it was held that he was not thereby postponed to junior lien creditors upon a distribution of the proceeds of the sale of one of the other properties. In Hastings' Case, supra, it was said that "one having a judgment which binds distinct pieces of land, may at law elect which he will proceed against for payment, or take which

The cases relied upon by the respective parties to this contention are: McDevitt & Hays' Appeal, supra, and the Appeal of the Pennsylvania Company for Insurance on Lives and Granting Annuities, 18 W. N. C., 469. While neither of them is exactly in point of facts like the present case, we think that McDevitt & Hays' Appeal more nearly resembles it. In that case, Devlin owned real estate in Chester county, on which there was a mortgage in favor of Maybin, which was a first lien upon this real estate. He also owned real estate in the city of Philadelphia. On September 21, 1868, judgment was entered against him in the District Court of Philadelphia, in favor of Claghorn, Herring & Company, for $3.706.50. This judgment was certified to Chester county September 22, 1868. On December 26, 1868, H. L. Carson & Sons obtained a judgment in the District Court of Philadelphia against Devlin for $6,000.00, and on December 9, 1869, Hay & McDevitt recorded a mortgage in Chester county for $2,000.00. On December 15, 1869, Kitchenman obtained a judgment in the District Court of Philadelphia for $6,783.20. This judgment was certified to Chester county, and became a lien on Devlin's real estate there December 16, 1869. On April 9, 1870, Claghorn, Herring & Company assigned their judgments to Carson & Sons. Under an execution issued on the Kitchenman judgment, Devlin's property in Philadelphia was, on June 6, 1870, sold for $4,000.00,

Hay & McDevitt's mortgage, and the entry of Kitchenman's judgment a year later, could not alter the status of the Carson & Company judgment so as to compel them to suffer a loss, which they were not obliged to sustain when their judgment was obtained."

his agreement to do so, he assigned to that company, as additional security. policies of insurance amounting, at their face value, to $40,000.00. About a year later, this company loaned Lauber a further sum of $20,000.00, upon the se

and the proceeds came into the sheriff's hands. The land of defendant in Chester county was, on October 27, 1870, sold, under the Claghorn judgment, assigned to Carson & Sons, for $5,900.00. This money was paid into court. No question was raised as to the right of Maybin's mortgage to be first paid out The case of the Appeal of the Pennof the fund; but, before the Auditor in sylvania Company for Insurance on Chester county, Hay and McDevitt and Lives and Granting Annuities, was as Kitchenman claimed to be paid out of follows: In 1880, Philip J. Lauber borthe fund there, taking the ground that rowed from the Pennsylvania Company the judgment of Claghorn, Herring & for Insurance on Lives and Granting Company, assigned to Carson, had been Annuities $35,000.00, and gave as secursatisfied by the previous sale of the de- ity therefore a mortgage on certain real fendant's real estate in Philadelphia.estate in the city of Philadelphia. About The Auditor, however, awarded the a week thereafter, in accordance with fund to Claghorn & Company's judgment assigned to Carson. The court below and the Supreme Court affirmed this conclusion. In discussing the question, Agnew, J., said, after stating the facts: "It is obvious, from this state of facts, that, when Carson & Company's judg-curity of a second mortgage on the ment was entered in Philadelphia, the case stood thus: Claghorn, Herring & Company had two funds to resort to one in Philadelphia and the other in Chester county. Had a sale then taken place, there could have been not conflict of interest whatever. Carson & Company having but a single fund to look to, could have compelled Claghorn, Herring & Company to take their judg-tained on the mortgages, a levari facias ment out of the Chester county fund, was issued on the first, and the premises and thus realized their own out of the were sold at sheriff's sale for $44,000.00, Philadelphia fund, or could have been a sum more than sufficient to pay the subrogated to Claghorn, Herring & first mortgage debt, but not enough to Company, which would have been the pay both in full. H. Clausen & Son same thing in effect. Having this right Brewing Company claimed that the first in equity, it is clear that they had a right mortgage debt was fully paid and satisto accomplish the same result by their fied by the proceeds of the sale, and the own act, and, therefore, could take an conditions of the first assignment being assignment of the judgment of Clag- thereby fulfilled, demanded the policies horn, Herring & Company, and take pay-of insurance, and filed a bill in equity ment of it out of the fund in Chester county, and thus lift off the Philadelphia fund the encumbrance of the Claghorn, Herring & Company judgment, and let themselves in upon that fund: Miller vs. Jacobs, 3 Watts, 477; Bank of Pennsylvania vs. Winger, supra; Hastings' Case, supra: Del. & Hud. Canal Co.'s Appeal, 38 Pa., 512. Now, it is not to be doubted, that the recording of

same premises. The policies of insurance were not pledged as security for this loan. In November, 1884, Lauber applied to the H. Clausen & Son Brewing Company and obtained a loan of $6,000.00, for which the same insurance policies were assigned as security, subject to the prior assignment. Shortly afterwards, judgment having been ob

for their delivery. The court below entered a decree, directing their assignto the said Brewing Company, and, upon appeal, this judgment was affirmed. Mr. Justice Sterrett, in delivering the opinion of the Supreme Court, said: "The court below rightly concluded that the defense thus set up was wholly insufficient, and accordingly decreed that the mortgage debt, for which the appellant held the

policies of insurance as collateral secur- | Schmertz's bond for $100,000.00, as seity, had been paid and discharged, and curity for the same debts that are covdirected appellant to assign, transfer and ered by the assignment of life insurance deliver said policies to the appellee. It policies. The judgment on this bond is a principle too well settled to require was a first lien on Schmertz's real estate. the citation of authorities that personal Subsequent to that were two other judgproperty, pledged specifically as security ments upon which executions were isfor a certain loan, cannot be held as se- sued and the land sold. Before the curity for subsequent advances, without auditor charged with distribution of the an agreement to that effect. It is not fund thus raised, no claim was made by even claimed that there was any such Loeffler, and no part of the fund was agreement in this case. The sheriff's awarded to his judgment; and it is consale under the first mortgage discharged tended that he thereby forfeited his the lien of both, and there being no prior right to payment out of the insurance lien creditors, the law appropriated the fund. On that question, the learned trial proceeds, first to the payment and satis-judge rightly refused to sustain the use faction of the first mortgage debt, and the plaintiff's contention-and his ruling residue on account of the second mort- is not specifically assigned as error. But gage debt. The legal effect of this was if it were, it is sufficiently vindicated in just the same as if Lauber, the debtor, the opinion of the court below. In adhad voluntarily paid the first and taken dition to the authority there cited may up his bond. The general rule undoubt-be added Ayres vs. Wattson, 57 Pa., edly is, that one who owes money upon 360, to the effect that a creditor may several distinct securities or accounts has hold an unlimited number of collaterals a right to apply his payment to either, and avail himself of any of them as as he pleases; but, if he makes a pay-long as the debt remains unpaid. 'A ment generally and without specifically person may, if he chooses, relinquish a appropriating it, the creditor may apply collateral security altogether, without it as he pleases. If neither debtor nor the consent of other creditors of his creditor makes any specific application debtor. It is a matter resting entirely of the money so paid, the law will ap-between him and his debtor with which propriate it according to the equity and others have nothing to do'; Dyott's Est., justice of the case. But this principle 2 W. & S., 490. It was further conapplies only in cases of voluntary pay-tended that, as Loeffler had a prior hold ments. It has no place in payments in on two funds, he should have resorted invitum, or where the money to be ap- to the other leaving this one intact for plied is the proceeds of judicial sale of the payment of general creditors. But real estate. In such cases the law ap- the junior lien creditors might with proplies the proceeds in order of their prior-priety have urged the same consideraity to such liens as are divested by the tions in relation to the realty fund. If sale." It will be observed that the sec- the defendant had participated in that ond mortgage had no claim upon the in- fund, the junior lien creditors might surance policies and had no right of have asked to be subrogated to his rights. subrogation to them. But, even though in the present fund." this distinction be not a valid one, the later case of Jennings vs. Loeffler, 184 Pa., 318, seems to me to modify the former case. Sterrett, C. J., in delivering the opinion of the court, gives the material facts, and says: "It is contended, however, by the beneficial plaintiff, that there are other facts in the case which will preclude Loeffler from paying himself out of this fund. Briefly stated, these facts are, that defendant held

It will be remembered that all the judgments held by The Lancaster Trust Company were upon the record, when the Herr judgment was entered. Herr, therefore, had no equities which entitled him to demand that the Trust Company take its first judgment out of the fund realized in Lancaster county, so that he might obtain his money from the York county real estate. Suppose the $10,o00.00 judgment was held by an outside