fore us does not warrant the finding that the defendant Guiles had been guilty of embezzlement previous to November, 1893. We are necessarily confined to what has been alleged and proved in the recent proceeding, and it might, therefore, be enough to say that neither in the petitions nor the answers is there any charge of embezzlement; nor was any effort made to offer evidence sufficient to justify the conclusion that the collector had been guilty of that crime. No doubt the inference of embezzlement may be drawn, but other inferences are scarcely less probable, for example, that up to that time he had not tried to collect the taxes for which he had not accounted; or that he had tried, but had failed for sufficient reasons; or that he had collected them, but had not been called upon, or had neglected, to pay them over. Each of these theories being possible, and fairly consistent with the evidence, the theory of embezzlement is inadmissible. Especially is it inadmissible because no good reason appears why either party to the pending controversy could not have offered evidence that might have gone far to satisfy us upon this point. For example, the collector's bank account during the years now being considered would certainly have been pertinent, and might have been illuminating; but, as neither saw fit to present more evidence than is now before the court, we shall not take upon ourselves the grave responsibility of volunteering to draw an inference of crime when neither party has charged it or has tried to prove it clearly. Surely, if a collector is believed to be guilty of embez zling public funds, the proper municipal officials violate a plain duty if they do not prosecute him. Embezzlement will never cease until embezzlers are punished with certainty and promptness. As the evidence does not warrant the finding that the collector had been guilty of crime, it follows that no city official had any reason then to suspect him of crime. But the testimony is ample to justify the conclusion-and we find it as a fact -that the principal city officials did then know that he had been grossly negligent in the discharge of his duty; and we also find that these officials themselves-whose duty it was either to receive moneys from him, or to supervise his conduct, and compel settlement of his accounts-had alike been grossly negligent in leniency toward an unfaithful servant, and in disregard of the law.

"The sureties were not asked by the city, but by the collector, to become his bondsmen. The facts concerning his failure to settle his accounts, his omission to make monthly returns, the character and dates of his payments, were then matters of public record in the departments of the city, and were accessible to any citizen, if he cared to inquire. But the sureties made no inquiry concerning the collector's previous conduct, and no representation upon this subject was made to them

at any time by any city official. Nothing whatever was said upon either side, either by the sureties or by the officers of the city.

"Upon these facts several legal questions arise. The first is this: Did the city officials' knowledge of the collector's previous neglect and misconduct require them to inform the sureties before these assumed the obligations of bondsmen? The sureties contend that the facts already stated imposed a duty upon the city to make known to them what had been the collector's previous conduct; and that failure to speak was fraudulent concealment, whereby they are relieved from liability upon the bond. No doubt, if there has been fraud in the treatment of sureties, if the person to be protected by the bond knows any fact material to the risk and conceals it willfully, the sureties are usually not bound; but, in 'öür opinion, the facts now in proof do not support the charge of willful and fraudulent concealment. No crime is proved to have been committed by the collector before November, 1893. sureties do not even aver that he had been

The

guilty of embezzlement; guilty of embezzlement; and therefore the most that can be said against his conduct is that he had been guilty of gross negligence in the discharge of his duty. So much was certainly true: He had been dilatory beyond reason; he had been irregular in payments; he had apparently consulted his own convenience as to how and when he should obey the law and discharge the duties of his office. In these respects the city officials had been at least as much in the wrong, for they had always had the power to bring him to account, but had chosen instead to acquiesce both in what he did and in what he omitted. Nevertheless, his deeds and misdeeds were irregularities only, however blamable. They fall short of dishonesty and crime; and, this being true, the decided weight of authority supports the conclusion that no duty was imposed upon the city to communicate the facts to the sureties. It is unnecessary to discuss the numerous decisions upon one side or the other that have been discovered by the industry of counsel, and noted in their very full and excellent briefs. Many of the cases cited are based upon the proposition that if the obligee in the bond knows that the principal has been guilty of what may perhaps be called a relevant crime, or of conduct equivalent to such a crime, out of such knowledge springs a duty to acquaint the sureties with the fact. Obviously, these cases are not applicable to this controversy, since criminal conduct has not yet been made to appear. The decisions we follow hold in positive terms that knowledge of mere irregularities, although these may be serious and extensive, imposes no duty upon the obligee to impart knowledge to the sureties. Bostwick v. Van Voorhis, 91 N. Y. 353; Tapley v. Martin, 116 Mass. 275; Insurance Co. v. Holway, 55 Iowa, 571, 8 N. W. 457; Railroad Co. v. Gow, 59 Ga. 685; Wade v. City of Mt. Sterling (Ky.) 33 S. W. 1113; Association

v. Smith, 70 Tex. 168, 7 S. W. 793. Our own decisions seem to go at least as far as these cases. Without discussing them, we refer to Boreland v. Washington Co., 20 Pa. St. 150; Wayne v. Bank, 52 Pa. St. 343; Beyerle v. Hain, 61 Pa. St. 226; and Bank v. Braden, 145 Pa. St. 473, 22 Atl. 1045. The ruling in Bolz v. Stuhl, 4 Pa. Super. Ct. 52, is not in point. There the principal had embezzled the money of a savings society, and the trustee had fraudulently concealed the fact from the sureties. We therefore hold that the first defense set up by the sureties is insufficient. "The second defense is of a similar charac

The first has to do with the knowledge and conduct of the city in November, 1893, when the sureties' obligation was entered into. The second is founded upon the knowledge and conduct of the city after November, 1893, and rests upon arguments similar to those already rejected. The sureties urge us to find as a fact-although they nowhere aver it, and did not prove it-that the defendant Guiles was guilty of embezzling some part of the delinquent taxes of 1893. They add to this the admitted fact that he failed to make the returns or settlement required by law, and aver that the city knew of the embezzlement and failure to report or settle at least as early as the spring of 1894, and that thereupon it became the duty of the city to communicate these facts to them,-arguing that the failure to communicate relieves them from responsibility for any conduct of the collector after the time just named. The facts upon this branch of the case have not yet been found. Briefly, they are these: The testimony does not justify us in finding that the defendant Guiles was guilty of embezzling any part of the delinquent taxes of 1893. He seems to have made reports from time to time, for certain papers were offered in evidence which appear to be monthly reports from January, 1894, to February, 1896, inclusive; and, although it does not clearly appear whether these reports were punctually made, they have not been attacked upon that ground, and must therefor be regarded as at least a partially successful attempt to comply with the law. The payments made to the treasurer by the collector during this period did not correspond with the amounts he received as shown by his several monthly reports. Payments continued to be made in round sums, as in the period before November, 1893. No settlement was made at the end of five months from the delivery of the duplicate into the collector's hands, nor was the schedule of unpaid taxes upon real estate then delivered to the treasurer, as required by law. His account for 1893 has never been settled by the controller, and he has never been called upon by any city authority to make such a settlement. We think there is no essential difference between the collector's omissions and commissions during the period now in question and his conduct during the period previously considered. He was still irregular, and slothful, and indiffer

ent to his duty, and so the city officials continued to be. Both were alike to blame, but neither can be found to have been guilty of fraud or crime. At the most, there were serious irregularities, but of these the city was under no obligation to notify the sureties. It was precisely against such lapses that the sureties' obligation was intended to protect the city; and even if it be conceded (but merely for the purpose of this case) that the city might have been obliged to notify the sureties promptly if the collector had been guilty of embezzlement, no obligation to notify arose out of the facts in proof. This conclu sion is supported by the reasoning of the cases already cited, to which may be added Railway Co. v. Shaeffer, 59 Pa. St. 350, recognized in Bank of Republic of New York v. Rochester Tumbler Co., 172 Pa. St. 626, 33 Atl. 748.

"In further answer to both defenses it may also be said with much force that the sureties were bound to take reasonable care of their own interests, both before and after they entered into the obligation now in controversy. Every source of information was as open to them as to any official of the city, both before and after the collector's appointment. Inquiry at the proper office in November, 1893, would have disclosed the fact that the collector's previous accounts for several years were still unsettled, and inquiry afterwards concerning the taxes of 1893 would have brought full information concerning his irregular and dilatory conduct. So, also, it would have been easy to learn the extent and character of his payments, both before and after the bond was signed. In point of fact, it was stated at the argument, and not denied, that the sureties did learn more than a year ago that the accounts of the collector were not in a satisfactory state, and obtained from him a judg-. ment bond for $6,000, which has been entered for their protection. Laying no weight, upon this, however, it seems fair to say that in a case like this, where irregularities simply are charged, and knowledge of these may be had by the sureties as easily as by the city, the sureties are quite able to protect themselves; and for this reason alone, if for no other, the city is under no obligation to speak of what they either know already or can learn without difficulty. Cawley v. People, 95 Ill. 249; Insurance Co. v. Mabbett, 18 Wis. 667; State v. Dunn, 11 La. Ann. 549; State v. Rushing, 17 Fla. 233; Magee v. Insurance Co., 92 U. S. 93.

"The city urges also, as an additional reply, that the rules invoked by the sureties do not apply to a municipal corporation; that upon grounds of public policy a municipality is not bound by the failure of its officers or agents to disclose, even in cases where individuals and private corporations would certainly be bound to speak. Numerous cases, of which U. S. v. Kirkpatrick, 9 Wheat. 720, may be taken as a type, and Com. v. Philadelphia City and County, 157 Pa. St. 558, 27 Atl. 553, is probably the latest in Pennsylvania, are cited in

support of this position. It need not be considered, however, since the reasons already given seem sufficient to show that the rules relied upon by the sureties do not now apply.

He

"It is also argued that, because the collector was not furnished with a warrant for the taxes of 1893, the sureties cannot be held for any sum that has not been actually collected, although the statute and the bond both charge the collector (and, of course, his sureties) with the sum named in the duplicate. The facts in this respect are these: No warrant accompanied the duplicate for that year, owing, probably, to some oversight. The collector could have had the omission supplied at any time, but he never made the request. never alleged, and does not now allege, that the lack of a warrant prevented him from collecting any tax; and there is no testimony whatever that the absence of a warrant was in the slightest degree a hindrance to collection. Under such circumstances it would be highly technical to say that what did no harm -the mere absence of a writ that he never had occasion to use-should be a sufficient excuse for failure to collect, or still more for failure to account. Com. v. Stambaugh, 164 Pa. St. 437, 30 Atl. 293. If there had been proof that he was not able to collect certain taxes because he had no warrant, a different question might arise, and Cannell v. Crawford Co., 59 Pa. St. 196, might then have weight in determining the answer. In our opinion, that case is not now in point.

shows that they were not collectible, or that they were mistakenly charged against the wrong person or the wrong property, or (if taxes against real estate) that they have been returned to the city treasurer in order to be entered in the lien docket by the city solicitor. These three items-taxes uncollectible, taxes mistakenly charged, and taxes chargeable against real estate-ought to cover every dollar of unpaid taxes upon the duplicate, and no difficulty, therefore, should be experienced by a faithful collector in relieving himself from the charge imposed by the law. But, whether faithful or faithless the burden of proof is put upon him by the statute, and, so far as he fails to show a good excuse for failure to collect or failure to account, he must bear the burden imposed by the law. Neither sentiment nor favoritism should be allowed to influence the collection of taxes. The law may be stringent, but, as long as it is the law, it should be strictly obeyed. Taxes will be paid promptly if the law, with its full penalty, is precisely and unvaryingly enforced. The amount for which Guiles and his sureties are liable is composed of two items. One is money actually received by him upon the duplicate, but not paid over to the city. We find as a fact, from his reports, from his entries in the duplicate, from the books of the city treasurer, and from other evidence in the case, that he received upon the duplicate in question taxes and penalties aggregating $26,973.08. Of this amount he has paid to the

This

is involved in some uncertainty, but we think it possible to reach a fairly accurate result. It is to be noticed that sections 8 and 9 of the act of 1889 expressly make a collector prima facie liable for the amount of tax charged in the duplicate. This is the sum for which he becomes liable when he accepts the duplicate, and this is the obligation of the sureties on the bond. The word "tax," however, includes the penalty, which by force of the statutes becomes part of the tax. Com. v. Scott, 7 Pa. Co. Ct. R. 409; City of Titusville's Appeal, 108 Pa. St. 600. He must 'pay over the amount charged against [him] except such sums as [he] may be exonerated from collecting by the proper city authorities.' Upon him, therefore, rests the burden of proof to show either that he has collected the whole sum charged, or that he is entitled to exoneration for part of it. If the command of the statute is obeyed, and a full settlement at the end of five months is required, no difficulty can arise. At the end of that period the collector will be charged with the amount of his duplicate, and with the accumulated penalties thereon to the respective dates when payments were made by the taxpayers. For the sums collected, less his commission, he must account in money. From the taxes remaining unpaid he should be exonerated by the proper city authorities, if he

credit of $1,273.68 for commission,-a total credit of $25,473.68. The difference between these two sums debited and credited is $1,499.40, and upon this amount-being money in his hands of which he has had the useinterest is properly chargeable according to the monthly balances appearing from the evidence. The interest has been calculated by the city, and appears to be $204.90. The defendants make no objection to the accuracy of the calculation, and accordingly we accept it as correct. The total amount, therefore, of the first item is $1,704.30. The sec ond item for which the defendants are liable is the amount apparently uncollected upon the duplicate. As already stated, the cities act of 1889 casts upon the collector the burden of proof in accounting for this item, and, since he has made no attempt to account for it, the charge imposed by the law continues. In effect, he is presumed to have collected it if he fails to account for it otherwise, and must be treated as if the money had actually been received; and, indeed, it may have all been received, for anything that appears to the contrary. It is enough, however, that section 9 of the act requires him to 'pay over the amount charged' in the duplicate, less exonerations. The following calculation will show the amount of tax that is apparently uncollected, but, in any event, is not accounted for in any way:

After this date no penalty is demanded, and therefore the whole amount remaining apparently uncollected and not accounted for will appear by subtracting from the sum just named the total amount of principal and penalties appearing by the collector's reports and the duplicate to have been received by him from the first day of April, 1894. We find this amount to be....

Leaving a balance against him of tax apparently uncollected and not accounted for of

Of this amount the city agrees to allow him as exonerations for uncollectible taxes and taxes mistakenly charged.......

The defendants make no objection to the accuracy of this item. The balance unaccounted for is therefore.... This amount is to be charged against the collector as if he had received it in cash, and accordingly we think it no more than fair to allow the usual commission. This would be .....

The net balance therefore due upon this item is .... Upon this sum the city asks to charge interest, but we think the request must be refused. Interest here would be more in the nature of a penalty than of interest proper; and, considering to what extent the city officials were responsible for the delay and official misconduct of the collector, it would not be equitable that the city should profit by punishing him or his sureties. A somewhat analogous case may be found in Com. v. Philadelphia City and County, 157 Pa. St. 558, 27 Atl. 553.

Adding the first item,-the sum due on account of money actually collected.........

2,501 73 $28,213 30 266 12 $28,479 42

3,790 05

$24,689 37

230 66 $24,920 03

2,156 69

$22,763 34 210 63

$22,973 97

2,797 42 $20,176 55 185 17

$20,361 72

$15,730 19

4,631 53

1,470 45

"For this amount, with interest from October 15, 1897, the execution may proceed.

"A final word may not be out of place. It is clear that, so far as the appearance and the fact may coincide,-so far as the apparently uncollected taxes are in reality still uncollected, the sureties may be required to pay to the city a sum of money for which certain taxpayers are primarily liable. Obviously, therefore, the sureties should be permitted to reimburse themselves by using the city's remedies against the delinquent taxpayers, and to that end the city should insist promptly that the collector furnish the required schedule of unpaid taxes assessed against real estate, so that liens may be entered and marked to the sureties' use after the execution now under consideration has been paid. Strictly speaking, this subject is not before the court in the present proceeding, but we venture to make the suggestion in the hope that future litigation may perhaps be thus avoided. The rules to open the judgment are discharged, at the costs of the respective petitioners.

"April 28, 1898. An exception to the above order on this page was asked for and refused on the ground that none was necessary. If the supreme court should be of a different opinion, an exception may be regarded as sealed.

"By the Court: The plaintiff has pointed out to me one or two mistakes in the calculation of the amount due by the defendants, and accordingly we substitute the following corrected statement in place of the items now inclosed in brackets on pages 17 and 18 of the opinion:

[The items which are here corrected appear printed in the opinion of the court between two lines of * *.]

(Includes $1,659.50 penalty).. Add 1 per cent. penalty, April 1...

(Includes $1,844.70 penalty)... After this date no penalty is demanded, and therefore the whole amount remaining apparently uncollected and not accounted for will appear by subtracting from the sum just named the amount of principal appearing by the collector's reports and the duplicate to have been received by him from April 1, 1894, and the penalty then accrued.

$20,179 58

185 20 $20,364 78

$3,168 08

With penalty accrued thereon, April 1, 1894....

The defendants make no objection to the accuracy of this item. The balance unaccounted for is therefore..... This amount is to be charged against the collector as if he had received it in cash, and accordingly we think it no more than fair to allow the usual commission. This would be ....

The net balance therefore due upon this item is

$3,912 17

195 61

$3,716 56

Amount brought forward....... Upon this sum the city asks to charge interest, but we think the request must be refused. Interest here would be more in the nature of a penalty than of interest proper; and, considering to what extent the city officials were responsible for the delay and official misconduct of the collector, it would not be equitable that the city should profit by punishing him or his sureties. A somewhat analogous case may be found in Com. v. Philadelphia City and County, 157 Pa. St. 558, 27 Atl. 553. Adding the first item,-the sum due on account of money actually collected........

$3,716 56

$1,704 30

It appears that the total amount due from the defendants is...... $5,420 86 "For this amount, with interest from October 15, 1897, the execution may proceed."

Assignments of Error.

"(1) The court erred in finding that defendant Guiles had not been guilty of embezzlement prior to November, 1893, which finding is as follows: "The fact that city taxes, apparently of a considerable amount, were outstanding, and seemed to be unpaid upon the duplicates in his hands, had been known to the municipal officers (including the councils) during the period from 1885 to 1892, inclusive, but no investigation seems to have been made, and no account had been required. In spite of this blamable neglect and indifference to clear statutory commands, the evidence laid before us does not warrant the finding that the defendant Guiles had been guilty of embezzlement previous to November, 1893.' (2) The court erred in holding that neither the pe titions of the defendants nor the answers of the city charged the defendant Guiles with embezzlement, which finding by the court is as follows: 'We are necessarily confined to what has been alleged and proved in the present proceeding, and it might therefore be enough to say that neither in the petitions nor the answers is there any charge of embezzlement; nor was there any effort made to offer evidence sufficient to justify a conclusion that the collector had been guilty of that crime. No doubt the inference of embezzlement may be drawn, but other inferences are scarcely less probable. For example, that up to that time he had not tried to collect the taxes for which he had not accounted; or that he had tried, but had failed for sufficient reasons; or that he had collected them, but had not been called upon, or had neglected, to pay them over.' (3) The court erred in finding that no city official had any reason to suspect Guiles of crime prior to November, 1893, which finding is as follows: 'As the evidence does not warrant the finding that the collector had been guilty of crime, it follows that no city official had any reason then to suspect him of crime. But the testimony is ample to justify a conclusion-and we find it as a fact that the principal city officials did then know that he had been grossly negligent in the discharge of his duty; and we also find that these officials themselves-whose duty it was to receive moneys from him, or to supervise his conduct and compel settlements of ats accourts-had alike been grossly negligent

in leniency towards an unfaithful servant, and in disregard of the law.' (4) The court erred in holding as matter of law that the city officials' knowledge of the collector's previous neglect and misconduct did not require them

to inform the sureties thereof before the latter assumed the obligation of bondsmen. (5) The court erred in holding as matter of law that the willful neglect of the city of Harrisburg to examine the accounts of the defendant Guiles from time to time, and its knowledge of his gross delinquencies prior to November, 1893, did not relieve the sureties from liability. (6) The court erred in deciding that the sureties were liable for anything done or omitted by the collector, Guiles, after the expiration of his term of office, which was five months from November 29, 1893, the date when he received the tax duplicate. (7) The court erred in holding that, although the collector did not have a warrant, his sureties are liable for such taxes as he did not collect. (8) The court erred in the computation of the amount due by the sureties in sureties in charging against them five per centum penalty on tax

es uncollected and outstanding, which penalty had accrued prior to the appointment of the tax collector, but which had not been charged in the duplicate delivered to him. (9) The court erred in deciding that the sureties were not relieved from all liability. (10) The court erred in deciding that the sureties were liable for the taxes uncollected and outstanding."

W. M. Hargest and C. H. Bergner, for appellants. D. S. Seitz and M. W. Jacobs, for appellee.

MCCOLLUM, J. Isaac W. Guiles was appointed by the treasurer of the city of Harrisburg collector of the unpaid taxes for the year 1893. He entered into a bond to the city in the sum of $30,513.02, with the appellants as sureties. The condition of the obligation was that, "if he faithfully accounted, according to law, for all taxes charged in the duplicate delivered or to be delivered to him by said treasurer, and in all respects faithfully performed the duties of his appointment as prescribed by the laws of Pennsylvania and the ordinances of the city of Harrisburg, then the obligation to be void, or else to be and remain in full force and virtue." As he failed in the performance of the duty imposed by his appointment, the city entered judgment on the bond, and issued execution thereon. The appellants, alleging that the execution was improvidently issued, petitioned the court to set it aside. On this petition a rule to show cause why the execution should not be set aside was granted, pending which the writ stayed, lien of levy remaining. In another petition, filed subsequent to the petition already referred to, the appellants claim, inter alia, that they were relieved from liability on the bond in question by the fraudulent concealment by the city officials of the misconduct of Guiles as collector of delinquent taxes from and including the year 1885 down to and