against the City of Rockland. Verdict for plaintiff in each case, and defendant excepts and moves for a new trial. Motion sustained. Argued before SPEAR, KING, HALEY, HANSON, and PHILBROOK, JJ. L. M. Staples, of Washington, for plaintiff. E. K. Gould, of Rockland, for defendant. trial in the absence of a showing to that effect Error, Cent. Dig. §§ 1279, 2899, 3729, 3730, CEPTIONS-TRANSCRIPT-EVIDENCE. The mere fact that an envelope containing a deposition was opened would not raise a prePER CURIAM. Two actions tried togeth-sumption that the deposition was used at the er to recover from the defendant city: One for pauper supplies furnished by the plaintiff town to George L. Barter and family from December 24, 1908, to June 16, 1910, and for funeral expenses of said Barter in June. 1910; the other for pauper supplies furnished to Mary A. Barter, his widow, Gen. Laws 1909, c. 278, § 3, requires the from June 17, 1910, to October 1, 1910. Ver- court stenographer to report all trials in the superior court, and make a transcript of any dict for plaintiff in both cases. Defendant part of the report upon written request filed filed exceptions and motion for new trial. by either party. Chapter 298, § 19, provides It is admitted that on June 10, 1899, Barter for a hearing as to the correctness of the transcript, and superior court rule 13 (62 Atl. ix) moved from Rockland to Rockport with his requires every petition to determine the corwife, and lived in the latter place from that rectness of a transcript to be accompanied by date until the date of his death, a period of an affidavit stating that the transcript is cor11 years. It is also admitted that on Decem-rect or incorrect, and, if incorrect, in what particular. Held, that the method prescribed is ber 24, 1908, a period of about 91⁄2 years aft- the exclusive method of procuring a correct er the pauper moved to Rockport, he re-record of the proceedings in bringing up a case ceived pauper supplies from on exceptions, and cannot be waived, and the transcript, when its correctness is established pursuant to the statutes, is exclusive evidence as to the proceedings at trial, and hence a deposition cannot be incorporated in the transcript merely by the parties' allidavits that they were in evidence at the trial. that town. There is no evidence that the pauper or any member of his family received pauper supplies from any source during those 91⁄2 years. From the evidence before us, the pauper had gained a pauper residence in the plaintiff town, and the motion for new trial by de fendant must be sustained in each case. It is unnecessary to consider the exceptions. Motion for new trial sustained. [Ed. Note.-For other cases, see Appeal and Error, Cent. Dig. §§ 2865, 2866; Dec. Dig. § 670.*] 6. APPEAL AND ERROR (§ 701*)-TRANSCRIPT OF EVIDENCE-EFFECT OF ABSENCE. In the absence of a transcript of the evidence, the Supreme Court cannot pass upon alleged error in refusing requested instructions. [Ed. Note.-For other cases, see Appeal and Error, Cent. Dig. §§ 2933-2935; Dec. Dig. § 701.*] 7. APPEAL AND ERROR (§ 656*)-PRESENTATION BELOW-HEARING OF EXCEPTIONS. Where defendant does not claim to be ag 1. APPEAL AND ERROR (§ 522*)-RECORD-EV-grieved by a ruling that a transcript was insuf IDENCE. Plaintiff cannot establish the introduction and effect of evidence by stating in his bill of exceptions that plaintiff offered evidence tending to prove the material allegations of the second count of the declaration, and defendant offered evidence to disprove all the material allegations thereof; it being necessary to include the evidence in the transcript to show those facts. [Ed. Note.-For other cases, see Appeal and Error, Cent. Dig. §§ 2367-2371; Dec. Dig. § 522.*] 2. EXCEPTIONS, BILL OF (§ 8*)- SETTING FORTH ERRORS. Under Gen. Laws 1909, c. 298, § 17, requiring a party bringing a bill of exceptions to state therein separately and clearly the exceptions relied on, a statement that at trial plaintiff offered evidence tending to prove the material allegations of his second count, and defendant offered evidence tending to disprove them, was out of place in the bill of exceptions, and may be treated as surplusage. [Ed. Note. For other cases, see Exceptions, Bill of, Cent. Dig. § 10; Dec. Dig. § 8.*] ficient for the consideration of two of plaintiff's exceptions, and has not filed a petition in the Supreme Court for the review of the trial court's action in considering such exceptions, its ruling thereon will not be reviewed on plaintiff's petition to establish the truth of his bill of exceptions and have the transcript declared sufficient for considering them. [Ed. Note. For other cases, see Appeal and Error, Cent. Dig. §§ 2826-2828; Dec. Dig. § 656.*] Action by George Beaule against the Acme Finishing Company. On plaintiff's petition to establish the truth of his bill of exceptions. Petition denied, and case ordered for hearing. Albert B. Crafts and William H. McSoley, both of Providence, for plaintiff. Gardner, Pirce & Thornley, of Providence, for defend ant. BAKER, J. This is an action of trespass on the case to recover damages for injuries on the part of the justice to strike out the sentence in question, nor does any good ground exist for its restoration. As to the bill of exceptions, the plaintiff obtains all that he is entitled to in the allowance of all of his exceptions. alleged to have been received through the and immaterial matter, it was not improper negligence of the defendant. It is now heard on plaintiff's petition to establish the truth of his bill of exceptions as filed, and to have the transcript of evidence, etc., as filed, together with the depositions of George Beaule and Cyprien Edgar Blais, declared sufficient for the determination of said exceptions. On the trial there was a verdict for the defendant. Plaintiff took several exceptions during the trial, and thereafter filed a bill containing eight exceptions, together with the transcript of certain proceedings in the chambers of the justice presiding at the trial before any jurors were called in the case, when said justice made a ruling as to the right of the petitioner to interrogate the jurors on their being called as to their having any prejudicial interest in a certain liability insurance company, and of the proceedings at the close of the trial with reference to the charge of said justice and to certain requests to charge made by the parties. The first exception in the bill relates to the ruling of the justice in chambers. The next six exceptions relate to rulings of the justice in refusing to charge the jury as requested by the plaintiff. The eighth exception refers to a ruling of said justice in charging the jury in terms of the seventh request of the defendant. Upon the transcript filed the justice made this indorsement: "I allow this transcript as being sufficient for the consideration of plaintiff's first, third, and sixth exceptions. I find it not to be sufficient for the consideration of plaintiff's second, fourth, fifth, seventh, and eighth exceptions." Plaintiff claims to be aggrieved thereby, and asks that "said transcript as originally filed, together with the said depositions, be declared sufficient for the determination of said exceptions." There is no express provision in the statute requiring a justice of the superior court to pass on the sufficiency of a transcript for the determination of a bill of exceptions. But, in Smith v. Hurley, 29 R. I. 489, 492, 72 Atl. 705, 707, this court held it to be the duty of the superior court, under section 17 of chapter 298 of the General Laws (formerly section 490, C. P. A.), "to determine * whether the entire transcript of the evidence shall be filed, or how much thereof may be necessary for the determination of the exceptions." In this case the justice has decid The parties were duly notified of the hear-ed that the transcript filed is sufficient for ing for the allowance of the bill of exceptions the determination of certain exceptions and and the transcript at which they appeared insufficient for others, as above stated. and were heard. Upon the objection of the While said chapter 298 does not expressly defendant thereto, said justice struck out the provide for proceedings before this court for following sentence on the first page of the the establishment of the truth of a tranbill of exceptions, namely: "On the trial of script, rule 13 of this court (62 Atl. ix) does said cause plaintiff offered evidence tending make provision for a "petition to determine to prove all the material allegations of the the correctness of a transcript of testimony," second count of plaintiff's declaration, and and points out the procedure to be followed. the defendant offered evidence tending to If this petition for declaring the sufficiency disprove all the material allegations of said of the transcript is properly before us, it count"-and allowed the bill as thus altered. must be by a somewhat liberal interpretation [1-3] Plaintiff claims to be aggrieved by of that part of rule 13 relative to a petition such alteration. By this sentence he at- to establish the correctness of a transcript. tempts to bring into the case a summary The transcript in this case contains the recstatement of the meaning and effect of ord of none of the evidence introduced before certain evidence alleged by him to have been the jury at the trial. The plaintiff did not introduced at the trial, to be accepted by ask the stenographer for any; the terms of the court as true, in place of the transcript his request to the stenographer being for "all of the evidence actually given as officially re- the evidence offered, and rulings of court as ported by the court stenographer. We do to the right of plaintiff to interrogate jurors not think this is permissible. However, even called to serve as to their financial interest if the statement could be considered as a in said liability insurance company, and all substitute for the transcript of the evidence, the requests of the plaintiff to charge refused it has no place in the bill of exceptions. The by the court to which exceptions were taken statute requires of the party bringing a bill by the plaintiff, and to requests to charge by of exceptions that in it "he shall state sep- the defendant granted by the court to which arately and clearly the exceptions relied up-exceptions were taken by the plaintiff, and all on." Section 17, c. 298, of the General Laws. The sentence stricken out is no part of the statement of an exception, and may properly be treated as surplusage, and therefore as not affecting in any way the rights of either party; but, inasmuch as a bill of exceptions, to meet the requirement of being clearly stat the charge of the court as given." [4] Two depositions are in the papers of the case. The envelope containing one of them has never been opened. The envelope containing the deposition of Blais has been opened. It is obvious that the unopened deposition was not used at the trial. There is no refer deposition of Blais at that time. The mere fact of its being opened affords no presumption that it was thus used. It may have been offered in evidence at the trial, and have been excluded for some reason, or it may have been admitted only in part. The record discloses nothing as to what did occur at the trial as to this matter. But the counsel of record of the plaintiff have filed their affidavits in this court stating that the two depositions were offered and received in evidence at the trial. There is no affidavit asserting the contrary. showed the admission in evidence as a whole or in part of the Blais deposition, and had the transcript when delivered and filed failed to show the use of this deposition in the trial, he would have had the opportunity, first, to dispute its correctness in this particular before the justice presiding, who would be assisted in passing on the question raised by his recollection of what took place at the trial, and, if aggrieved by the action of said justice thereon, secondly, to raise the same question here by petition accompanied by affidavit. We start, however, with the record of the proceedings at the trial as made by the court ed as correct. If objected to, and the objec- It is in the [5] Admitting these affidavits to be true as to the deposition of Blais, is such deposition properly before the court for its considera- stenographer. If unchallenged, it is accepttion? We think not. The statute provides an orderly method for the production before this court in its consideration of a bill of exceptions of a correct record of so much of the proceedings at the trial below as may be necessary therefor. Section 3 of chapter 278 of the General Laws requires that a court stenographer "shall report stenographically the proceedings in the trial of every action or proceeding, civil or criminal, in the superior court," and "shall also make a transcript of the whole or any part of such report upon the written request, filed with the clerk by either party to such action or proceeding." Section 19 of said chapter 298 makes provision for a hearing of the parties before the justice who presided at the trial as to the correctness of such transcript, and for its allowance or disallowance by him in accordance with his finding on that point. No exception is permitted to such decision; but his action may nevertheless be reviewed, and, if a party is aggrieved thereby, said rule 13 (62 Atl. ix) provides that every petition to determine the correctness of a transcript of testimony shall be accompanied by affidavit, setting forth that the transcript certified by the court stenographer is correct or incorrect as the case may be, and, if incorrect, in what particular. All of these successive steps are established in order to obtain a true record. "The transcript, when its correctness is finally established, is conclusive evidence as to the proceedings at the trial." Vassar v. Lancaster, 30 R. I. 221, 227, 74 Atl. 711, 713. In our judgment, also, this authorized mode of procedure is designed to be exclusive, and to take the place of all former and other methods for procuring a correct record of the proceedings below in bringing up a case on exceptions. In this case no question is raised as to the correctness of the transcript filed. The indorsement of the justice presiding is fairly to be interpreted as allowing the transcript to be correct, so far as it goes, although finding that it is insufficient and incomplete, and the petition of the plaintiff now under consideration does not deny its correctness. Had the plaintiff requested of the stenographer in transcript of all the evidence, or of [6] In the absence of a transcript of any of the evidence taken at the trial it is difficult to discover any ground for disturbing the finding of said justice as to the insufliciency of the transcript for the consideration of the second, fourth, fifth, seventh, and eighth exceptions. He saw the witnesses, heard the testimony, and had the opportunity of judging as to its significance and value. Under these conditions his decision is entitled to be upheld. Even if some of the plaintiff's requests were to be accepted as correct statements of law, in the absence of any transcript of evidence we cannot determine as to their pertinency, sufficiency, or correctness as they may relate to this case. See In re Stillman, 28 R. I. 297, 67 Atl. 5; The plaintiff fails, therefore, to show that which, though due the estate and collectibie, he his petition ought to be granted. has made no attempt to collect. [7] The defendant on its part urges that the transcript is insufficient, also, for the determination of plaintiff's third and sixth exceptions. It has, however, not claimed to be aggrieved by the ruling of the justice that said transcript is sufficient for the consideration of said two exceptions, and has filed no petition in this court for the review of his action in this particular, and therefore his ruling as to these exceptions is not before us. In accordance with what has already been stated, the plaintiff's petition is denied, and the case will stand for hearing on the first, third, and sixth exceptions of said bill of exceptions. (242 Pa. 269) TENTH NAT. BANK OF PHILADELPHIA v. SMITH CONST. CO. (Supreme Court of Pennsylvania. Oct. 13, 1913.) 1. RECEIVERS (§ 203*) - RECEIVER'S ACCOUNT -AUDITOR'S REPORT. [Ed. Note.-For other cases, see Receivers, Cent. Dig. § 192-194; Dec. Dig. § 105.*] 5. RECEIVERS (203*)-AUDIT OF ACCOUNT SURCHARGE-PRESUMPTIONS. Where the evidence at the audit on a receiver's account shows that the receiver has been dishonest and that he has not attempted lectible, no presumptions will be indulged in his to collect accounts which are apparently colfavor, but he should present the best evidence obtainable to support his contention that outstanding accounts were uncollectible. [Ed. Note.-For other cases, see Receivers, Cent. Dig. 88 404-406; Dec. Dig. § 203.*] 6. RECEIVERS (§ 203*)-SURCHARGING RECEIV ERS' ACCOUNT-EVIDENCE. Where, within five weeks before the appointment of the president of a corporation as its receiver, a large sum was deposited in a bank by the corporation, and the receiver at the audit or his account failed to produce documentary evidence to show what had become of such deposit, the court properly held that, in the absence of any evidence explanatory of his failure to collect the deposit, the accountant was chargeable therewith. [Ed. Note.-For other cases, see Receivers, Cent. Dig. 88 404-406; Dec. Dig. § 203.*] 7. RECEIVERS (§ 99*)-EXPENSES-SURCHARGE. Where a bank, one of the creditors of a Where the auditor's report on a complicat- corporation placed in the hands of a receiver, ed receiver's account restates the account, re- claims allowances for counsel who represented ferring specifically to evidence in support of it, and for services rendered by an expert acthe various items thereof, and shows a reasona-countant, and for money expended for the re ble possibility of arriving at a correct account-covery of corporate assets, all of which ening under the proofs before him, it is error to larged the general fund for distribution, such set aside the report on the ground that it is claims are proper charges against the estate; impossible to restate the account by reason of and, if made necessary by breaches of duty on the absence of certain documentary evidence the part of the receiver, he should be surcharged from the report, without specifically pointing for an equal amount. out such evidence or the particulars wherein it was impossible for the auditor to make a restatement. [Ed. Note. For other cases, see Receivers. Cent. Dig. §§ 404-406; Dec. Dig. § 203.*] 2. RECEIVERS (§ 105*)-RECEIVER'S ACCOUNTSURCHARGING RECEIVER OF CORPORATION PARTNERSHIP PROFITS. Where three officers of a corporation, a construction company, formed a partnership to perform certain services for the corporation from which the partnership made a profit, and where, after the appointment of one of such partners as receiver of the corporation, the arrangement was discontinued, but the receiver paid to the partnership the amount claimed to be due it at the time of his appointment and made no attempt to recover from it profits which it had realized through its relation with the corporation, the court properly surcharged the receiver on account for his failure to recover such profits and also with the sum paid to the partnership. [Ed. Note. For other cases, see Receivers, Cent. Dig. §§ 192-194; Dec. Dig. § 105.*] 3. CORPORATIONS (§ 314*) INSOLVENCY PARTNERSHIP-LIABILITY FOR PROFITS. Where the officers of a corporation, a construction company, form a partnership to perform services for the corporation, from which they derive a profit the law will imply a fraud, and they may be held liable to the corporation for such profits. [Ed. Note. For other cases, see Receivers, Cent. Dig. 88 183-186; Dec. Dig. § 99.*] 8. RECEIVERS (§ 202*) - SURCHARGE OF AC COUNT-COUNSEL FEES. Where the receiver of a corporation claims credit for fees paid to counsel, and such credit is allowed by the auditor without objection, and it is certain that counsel fees would have been required under a proper administration of the trust, the accountant, though guilty of breaches of duty, should not be surcharged with the amount of such fees without affording counsel an opportunity to present proofs to support the fees paid them and show that their serv ices were beneficial to the estate. [Ed. Note.-For other cases, see Receivers, Cent. Dig. § 403; Dec. Dig. $ 202.*] 9. RECEIVERS (§ 200*) - RECEIVERSHIP — EXPENSE OF AUDIT. Where the conduct of a receiver of a corporation in the mismanagement of his trust is largely responsible for the complexity and costliness of the audit of his account, a large portion of such expense should be assessed against him. [Ed. Note. For other cases, see Receivers, Cent. Dig. 88 397-399, 401; Dec. Dig. § 200.*] Appeal from Court of Common Pleas, Philadelphia County. Action by the Tenth National Bank of Philadelphia against the Smith Construc[Ed. Note.-For other cases, see Corporations, tion Company. From a decree in equity susCent. Dig. § 1393-1398, 1400; Dec. Dig. 8taining exceptions to auditor's report, Wil314.*] 4. RECEIVERS ( 105*)-LIABILITIES. A receiver is chargeable not only with money actually received by him, but with money liam R. Richards, individually and as receiver of the Smith Construction Company, and another, appeal. Reversed. The Tenth National Bank of Philadelphia, | the receiver had failed to account or had ima creditor of the Smith Construction Company, a corporation engaged largely in the construction of railroads, filed a bill in equity for the appointment of a receiver for said company, on January 27, 1905, and on the same day William R. Richards, president of the company, was appointed receiver. The United States Fidelity & Guaranty Company executed the receiver's bond in the sum of $100,000. The receiver's account was referred to an auditor, who surcharged the receiver in certain amounts, as appears by the opinion of the Supreme Court. On exceptions to the auditor's report, the court below sustained certain of the exceptions and increased the amount of the surcharges. Argued before FELL, C. J., and BROWN, MESTREZAT, POTTER, STEWART, and MOSCHZISKER, JJ. John C. Gilpin, George S. Graham, and George Wharton Pepper, all of Philadelphia, for appellant William R. Richards. G. W. Pepper, of Philadelphia, for appellant United States Fidelity & Guaranty Co. A. G. Dickson and James McMullan, both of Philadelphia, for appellee, Fourth Street National Bank. properly accounted for assets of the estate and for all credits claimed which he conceived to be insufficiently vouched. The court below acted upon the theory that the estate was solvent when it went into the hands of the receiver, that the account was incomplete, that it had not been properly vouched, and that it was impossible to state an account with sufficient exactness. The amount the accountant was ordered to pay was peremptorily fixed at the total of all the claims against the company and the receiver, plus counsel fees and the expenses of the audit. While the court does not directly order specific surcharges, yet, in collateral justification of the amount fixed in the final decree, it briefly discusses a number of separate items which in its opinion are proper subjects for surcharge, and these aggregate more than the gross sum decreed against the receiver. Counsel for the appellants state in their printed argument, "The court below disposed of the case upon, the basis of general conclusions without making specific findings of fact and without passing specifically upon more than one of the 531 exceptions to the auditor's findings," and this statement is MOSCHZISKER, J. The Smith Construc- substantially correct; particularly is it cortion Company was a corporation under the rect as to all the important underlying facts. laws of New Jersey with a principal office in The method thus pursued has added greatly Philadelphia, engaged largely in building to our labors on appeal; but we have exrailroads and in public contracts. On Jan- amined the record and the testimony with the uary 27, 1905, upon the complaint of a cred- utmost care, and cannot concur in the genitor, William R. Richards, its president, was eral condemnation of the audit contained in appointed receiver by the court below. He the opinion of the learned court below. A was granted permission to continue work un- detailed discussion of all aspects of the varider contracts in course of performance, in the ous points involved would unduly extend this hope that profits might be derived there- opinion. Our examination has satisfied us, from; but these operations proved a failure however, that as a rule the auditor had and large losses resulted. At the suggestion evidence upon which to base his findings and of a committee of creditors, appointed to suthat his conclusions were justified in most pervise the conduct of the business by the re- instances; later on we shall treat separately ceiver, the affairs of the company were of the cases where we do not deem this to wound up. The receiver filed accounts which be so. were referred to an auditor. The action of the court below upon the report of the auditor is before us on two appeals, one by the receiver and the other by his surety; both of these appeals will be disposed of in this opinion. The magnitude of the work involved in the audit will be appreciated when it is understood that 130 meetings were held and 1,850 printed pages of testimony taken. The auditor's report covers 530 printed pages, and in it he finds a multitude of specific facts in addition to answering many requests; he discusses the testimony, clearly states his reasons for all conclusions reached, and makes various surcharges against the receiver, amounting to $41,310.09. The court below practically set aside the entire report of the auditor and decreed that the receiver should pay $250,409. The auditor endeavored to surcharge upon The "one" instance above referred to where the court below formally passed "specifically" upon a finding of the auditor involved the financial condition of the Smith Company at the time of the receivership. The auditor found as a fact that the corporation was insolvent on January 27, 1905, when the receiver was appointed, and the evidence before him justified this finding; hence the court erred when it decided otherwise. It is true that statements were made by Richards and his counsel at that time which indicated their belief in the solvency of the company; but such statements concerning the financial condition of hopelessly insolvent concerns are not unusual, and the auditor could not permit them to outweigh the evidence which proved insolvency. [1-3] Although the court expresses the view that an account could not be stated, yet the auditor not only found that it was pos |