Opinion by
Mr. Justice Dean,
The facts in this case have been fully and clearly stated by the learned referee. A number of the points in controversy decided in the court below are practically eliminated here on this appeal, because not pressed in the argument. In fact, but one is left about which there is any serious contention, to wit: was the sum of 110,858.22, the interest of John M. Risher in the Glassport mortgage, and by him assigned to appellees, legally appropriated by the assignees of that interest ?
The assignment was made April 14, 1897, and placed on record April 29, fifteen days afterwards. The assignor made no specific appropriation of the amount to any particular indebtedness of his to the assignees, while the aggregate indebtedness was in a much larger amount,.made up of several items and based on obligations different in character. Nor did he even, give personal notice to the assignees, that he had made such assignment. On May 10 following, having for the first [169] time learned of the assignment, the assignees immediately gave notice to John M. Risher that they accepted it and would apply the amount embraced in it in part payment of his two promissory notes, one in sum of $10,000, dated January 1, 1890, the other dated June 20, 1891, in sum of $5,000, which notes had been given by him, the drawer, to Levi Risher, their testator. To this notice John M. replied in wilting, that he had appropriated the amount to the reduction of his indebtedness to the estate of John C. Risher, in which the testator of assignees had a one-fourtli interest.
It obviously was not to the interest of John M. to appropriate the assignment towards payment of the notes. John C. Risher, the father, had died in 1889, leaving a very large estate to liis four children, Levi, John M., Agnes and Sarah. Levi died in 1891, leaving his interest in liis father’s estate to these assignees. John M., at the date of these notes, had largely overdrawn his share of the ancestral estate; he had settled his shortage at that date with his brother and colegatee, by giving these notes; afterwards he became still further indebted by overdrafts in a large sum on the same fund. In settlement of the present account prayed for, the respondents charge the representatives of Levi Risher with the one-fourth interest passed by the assignment of the Glassport mortgage, which of course would reduce the later overdraft $10,858.22, leaving the old overdraft outstanding and resting on the two notes; defendants consequently would have to account for and pay over just that much less.
The first question raised in the contention was one of fact; was there any appropriation of the money by John M. at the time lie made the assignment or afterwards, before the creditors, these appellees, made an appropriation of it? There was some evidence that at the time of the assignment John M. intended to apply it to his then existing indebtedness to the estate, treating the notes given for the old shortage as a payment of Levi’s share of that shortage; making it applicable to tbe later and existing indebtedness, would tend to equalize the present distribution among the colegatees. But the evidence, both as to the existence of such intention and as to its having been communicated verbally to these appellees at the time of the assignment, is contradictory. The referee finds as a fact, that if [170] such intention was in the mind of John M. at the date of the assignment, it was not communicated to the assignees; that they did not know such assignment had been made until May 10, following, and that then they immediately communicated to John M. their acceptance, and signified their appropriation of it to the old indebtedness on the notes. There was ample testimony, although some of it contradictory, to warrant this finding ; it has been approved, after hearing, by the court below; a careful examination of the testimony not only convinces us it was not manifestly wrong, but that it was right. We then have the fact of a general assignment of -the interest in a mortgage to creditors having a much larger aggregate claim, without notice by the debtor of an application of it by him to any particular debt; and an application by the creditors of the amount in part payment of a particular part of his obligation.
The rule in this state, as held by the referee and court below, is, that a debtor may appropriate his payments as he sees fit at the time he makes them; if he makes none, the creditor can make such appropriation on one or-more of several obligations; if neither, at the time of payment, make such appropriation, then the law will make one to the debts oldest in point of time: Souder v. Schechterly, 91 Pa. 86; Pardee v. Maride, 111 Pa. 548, and many other cases. Where the debtor makes no appropriation, and the creditor does so, the latter may apply it to that item of debt which to him seems least secure: Reed v. Ward, 22 Pa. 144; Hollister v. Davis, 54 Pa. 508. It has been held that, even where one claim is barred by the statute of limitations and the other not, the creditor may apply the undirected payment to the debt barred and sue upon the other: Wait’s Actions & Defenses, 416. No case in this state has gone that far, nor is it necessary to here decide that point; we cite the ruling only as illustrating the tendency of the courts to vest a wide discretion in the creditor in the absence of appropriation by the debtor. The rule could not be more concisely stated than in Martin v. Draher, 5 Watts, 544: “The debtor when he pays may insist on a credit on a particular amount, and unless he gets it may withhold his money. If nothing is said or agreed beforehand as to which debt the payment is to be applied, the creditor may apply it to either at his option.”
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Opinion by
Mr. Justice Dean,
The facts in this case have been fully and clearly stated by the learned referee. A number of the points in controversy decided in the court below are practically eliminated here on this appeal, because not pressed in the argument. In fact, but one is left about which there is any serious contention, to wit: was the sum of 110,858.22, the interest of John M. Risher in the Glassport mortgage, and by him assigned to appellees, legally appropriated by the assignees of that interest ?
The assignment was made April 14, 1897, and placed on record April 29, fifteen days afterwards. The assignor made no specific appropriation of the amount to any particular indebtedness of his to the assignees, while the aggregate indebtedness was in a much larger amount,.made up of several items and based on obligations different in character. Nor did he even, give personal notice to the assignees, that he had made such assignment. On May 10 following, having for the first [169] time learned of the assignment, the assignees immediately gave notice to John M. Risher that they accepted it and would apply the amount embraced in it in part payment of his two promissory notes, one in sum of $10,000, dated January 1, 1890, the other dated June 20, 1891, in sum of $5,000, which notes had been given by him, the drawer, to Levi Risher, their testator. To this notice John M. replied in wilting, that he had appropriated the amount to the reduction of his indebtedness to the estate of John C. Risher, in which the testator of assignees had a one-fourtli interest.
It obviously was not to the interest of John M. to appropriate the assignment towards payment of the notes. John C. Risher, the father, had died in 1889, leaving a very large estate to liis four children, Levi, John M., Agnes and Sarah. Levi died in 1891, leaving his interest in liis father’s estate to these assignees. John M., at the date of these notes, had largely overdrawn his share of the ancestral estate; he had settled his shortage at that date with his brother and colegatee, by giving these notes; afterwards he became still further indebted by overdrafts in a large sum on the same fund. In settlement of the present account prayed for, the respondents charge the representatives of Levi Risher with the one-fourth interest passed by the assignment of the Glassport mortgage, which of course would reduce the later overdraft $10,858.22, leaving the old overdraft outstanding and resting on the two notes; defendants consequently would have to account for and pay over just that much less.
The first question raised in the contention was one of fact; was there any appropriation of the money by John M. at the time lie made the assignment or afterwards, before the creditors, these appellees, made an appropriation of it? There was some evidence that at the time of the assignment John M. intended to apply it to his then existing indebtedness to the estate, treating the notes given for the old shortage as a payment of Levi’s share of that shortage; making it applicable to tbe later and existing indebtedness, would tend to equalize the present distribution among the colegatees. But the evidence, both as to the existence of such intention and as to its having been communicated verbally to these appellees at the time of the assignment, is contradictory. The referee finds as a fact, that if [170] such intention was in the mind of John M. at the date of the assignment, it was not communicated to the assignees; that they did not know such assignment had been made until May 10, following, and that then they immediately communicated to John M. their acceptance, and signified their appropriation of it to the old indebtedness on the notes. There was ample testimony, although some of it contradictory, to warrant this finding ; it has been approved, after hearing, by the court below; a careful examination of the testimony not only convinces us it was not manifestly wrong, but that it was right. We then have the fact of a general assignment of -the interest in a mortgage to creditors having a much larger aggregate claim, without notice by the debtor of an application of it by him to any particular debt; and an application by the creditors of the amount in part payment of a particular part of his obligation.
The rule in this state, as held by the referee and court below, is, that a debtor may appropriate his payments as he sees fit at the time he makes them; if he makes none, the creditor can make such appropriation on one or-more of several obligations; if neither, at the time of payment, make such appropriation, then the law will make one to the debts oldest in point of time: Souder v. Schechterly, 91 Pa. 86; Pardee v. Maride, 111 Pa. 548, and many other cases. Where the debtor makes no appropriation, and the creditor does so, the latter may apply it to that item of debt which to him seems least secure: Reed v. Ward, 22 Pa. 144; Hollister v. Davis, 54 Pa. 508. It has been held that, even where one claim is barred by the statute of limitations and the other not, the creditor may apply the undirected payment to the debt barred and sue upon the other: Wait’s Actions & Defenses, 416. No case in this state has gone that far, nor is it necessary to here decide that point; we cite the ruling only as illustrating the tendency of the courts to vest a wide discretion in the creditor in the absence of appropriation by the debtor. The rule could not be more concisely stated than in Martin v. Draher, 5 Watts, 544: “The debtor when he pays may insist on a credit on a particular amount, and unless he gets it may withhold his money. If nothing is said or agreed beforehand as to which debt the payment is to be applied, the creditor may apply it to either at his option.”
It is earnestly argued, that even if express notice were not [171] given to the assignees of the intention of John M. to apply the assignment to the indebtedness subsequent to the notes, that intention is plainly to be inferred from all the dealings of John M. with the legatees, and that express notice to the assignees of the mortgage was not required. It is probably a reasonably fair inference that John M. did not intend an appropriation of his interest in the mortgage in payment of the old notes, and that possibly he intended at some future time to signify to the assignees his request for a credit on his after indebtedness. But there was no payment at all until a delivery of the assignment. When was it delivered, so far as concerned the assignor ? Clearly on April 29, the day it was recorded; as concerns the assignees, as soon as they had notice of the record, if they did not within a reasonable time dissent to the payment or the application of it. Between the day of record and May 10 following, they had actual notice that it was recorded ; they knew it was on its face a general payment, with no terms as to application of the amount; they did not dissent, but expressly accepted the payment, and formally notified the assignor of such acceptance, and their application of the payment ; ten days afterwards, the assignor objects to the appropriation. He was too late. Without a word indicating his intention to pay a particular debt out of a large number of obligations, he in effect hands to his creditor more than 110,000 as payment of his indebtedness. The creditor accepts the money, and notifies him it has been appropriated to a particular item of the indebtedness. That closed the transaction, irrevocably, as to both debtor and creditor. As is said in Martin v. Dralier, supra, “ The debtor when he pays may insist on a credit on a particular amount, and unless he gets it, may withhold his money; ” but he cannot pay his money without stipulations, then after notice that the creditor has exercised his right insist on changing or controlling the appropriation. The question of notice under these facts is of no importance; the debtor paid; the creditor accepted and appropriated, and therefore had notice.
We cannot sustain any of the assignments of error, and the decree of the court below is affirmed.