Kenworthy v. Levi

• Citation: 63 A. 690,214 P. 235
• Parties: KENWORTHY v. LEVI.
• Decision Date: 05 March 1906
• Court: Pennsylvania Supreme Court

63 A. 690
214 P. 235

KENWORTHY
v.
LEVI.

Supreme Court of Pennsylvania.

March 5, 1906.

Appeal from Court of Common Pleas, Philadelphia County.

Bill by Joseph W. Kenworthy, trustee, against Julius C. Levi and others. From a decree dismissing the bill, plaintiff appeals. Reversed.

Argued before MITCHELL, C. J., and FELL, BROWN, MESTREZAT, POTTER, ELKIN, and STEWART, JJ.

Jacob Singer and Emanuel Furth, for appellant. M. Hampton Todd, for appellee.

BROWN, J. On July 9, 1889, Mary Bell Henry and James P. Henry, her husband, conveyed to Moses T. Johnson, in trust, her interest in certain real estate situated In Indiana and the city of Philadelphia. The uses and purposes for which the trustee was to hold the property are fully set forth in the deed conveying it to him, but they need not be recited, as they are not material in determining the question raised on this appeal, which is as to his power to borrow money as trustee and to pledge as security

63 A. 691

for its repayment a mortgage given to him as trustee. The words of the deed defining his power over the corpus of the estate are that he may "sell and convey in fee simple the whole or any part of the trust estate to any person, persons or corporations, and reinvest the proceeds of the same or of the sale of any investment made therewith in real estate, ground rents or first mortgages, as he may deem best; provided, however, that the principal of the estate shall not become impaired or encumbered." On August 6, 1889, a second deed was executed by the same grantors to the same grantee, in trust, conveying to him the interest of Mrs. Henry in certain real estate situated in the city of Philadelphia. This conveyance was "under the same trusts and for the same uses and purposes and with the same powers as are given to the said Moses T. Johnson" by the deed of July 9, 1889, with the additional power of authorizing him to settle and adjust all claims for money advanced by George W. Purnell to either of the grantors. On December 17, 1900, Moses T. Johnson, who had sold some of the real estate under the power conferred upon him, invested $5,250 of the trust funds in his hands in a first mortgage on property situated in the city of Philadelphia and owned by Harry S. Garrow, the mortgagor. On June 17, 1901, Johnson, as trustee, borrowed $3,000 from Julius C. Levi, trustee, the present appellee, and as collateral security for the repayment of the loan assigned to Levi the Garrow bond and mortgage for $5,250...