Wallace v. Cameron, Secretary of Banking.

To sustain the authority of the Secretary of Banking to suspend the license of the petitioner, the learned Attorney-General is depending upon the construction placed upon sections 16 and 19 of the Securities Act; but, before taking up this matter, it is well to bear in mind the procedure followed by the Securities Bureau. The petitioner was notified to appear before the Securities Bureau on July 8, 1925. He appeared and was heard upon the question whether he was guilty of violating the Securities Act. The next day, July 9, 1925, the petitioner notified the Securities Bureau that, since hearing their opinion of the distinction between a "dealer" and an "agent," "which distinction he did not appreciate until yesterday," he begged to inform the bureau as follows: "I do not intended as a dealer being interested in any securities where this question may arise, and shall confine my business exclusively to the functions of a dealer, as you interpret them; that is, buying and selling bonds and stocks usually offered by banking houses." It thus appeared that he was either guilty or not guilty of violating the provisions of the Securities Act. If guilty, he was unaware of his guilt until informed by the Securities Bureau. Whether the interpretation placed upon the act by that bureau is correct we do not now decide, as that question is not before us; but it does appear that the petitioner expressed entire willingness to comply with the orders of the bureau until that question was judicially determined. Disregarding the willingness of the petitioner to comply with the directions of the Securities Bureau and that a hearing upon this very question had been held, four days after the letter of July 9, 1925, had been addressed to the bureau by the petitioner, he, the petitioner, was again notified to appear for a hearing (not a further hearing, but for a hearing) to show cause why his registration should not be permanently revoked, and pending this hearing his registration was suspended.

The petitioner returned his certificate of registration as requested. He did not appear in person on July 21st, the time fixed by the Securities Bureau for his hearing, but appeared by affidavit-set forth fully and at length on page 5 of the petition-in which he gives reasons (see page 7 of petition) why his dealer's license should not be revoked, among them being, "because of a possible error in the interpretation by the Bureau of Securities of the definition of the word 'dealer' as set out in the act;" and in various paragraphs of said affidavit the petitioner squarely raises the question as to the proper legal interpretation of the word "dealer" as contemplated by the said act.

The facts had been determined at the hearing held July 8th; there were no new facts to be disclosed by a further hearing, and it seems to us to be begging the question to now contend that final action in the petitioner's case has not been taken because he did not appear for a hearing July 21st; as, for all practical purposes, the petitioner's case was squarely set forth in his affidavit in reply to the notice to appear, and, upon consideration of the facts set forth in the said affidavit, it would have been entirely proper, and possible, for the Secretary of Banking to have rendered a decision, either that the registration of the petitioner should be permanently revoked or that the suspension should be lifted.

We will now proceed to examine the interpretation placed upon section 16 of the Securities Act by the Secretary of Banking. This section provides, inter alia (see Act of June 14, 1923, P. L. 786): “If the commissioner at any time has reason to believe any dealer has in any way violated, or is violating, or is about to violate, any of the provisions of this act, or has been guilty of any fraud or fraudulent practice, then the commissioner may, after hearing,

Wallace v. Cameron, Secretary of Banking.

and having reasonable cause to believe that the dealer has been guilty of such offence, revoke said dealer's registration."

Proceeding under authority of the above-quoted paragraph of section 16 of the said act, the petitioner was notified to appear, and did appear, before the Securities Bureau for examination on July 8, 1925. He was then and there advised that his stock transactions as a registered dealer in securities were, as interpreted by the said Securities Bureau, in violation of paragraph (c), section 2, of the act. The petitioner, by letter dated July 9, 1925, agreed to comply with the requirements of the Securities Bureau, notwithstanding his protest that such interpretation was not sustained by the plain wording of paragraph (c), section 2, of the Securities Act.

The Secretary of Banking also relies upon a subsequent paragraph of section 16 of the act, which further provides: "If the commissioner believes the public interest may be endangered by such dealer continuing in business pending such hearing, the commissioner may also suspend such dealer's registration pending such hearing." This language does not apply to a situation such as that before us. The petitioner had already been heard, and we think the duty of the Secretary of Banking clearly was to either revoke or not to revoke his registration and not to suspend it. He had supplied the Securities Bureau with all the information they requested. What further hearing was necessary, except possibly to pass upon the legal questions raised? The actual personal presence of the petitioner was not necessary to a decision of a question involving only the interpretation of a word used in the Securities Act. These questions have not been adjudicated, and the defendant now seeks to avoid such adjudication by asking that this appeal be dismissed rather than that it be sustained, in order that the legal questions raised upon the record may be judicially decided. Had the Secretary of Banking suspended the petitioner's registration prior to the first hearing, we think he would have been strictly within his rights. This, however, he did not do, nor did he see fit to revoke the registration of the petitioner after the hearing. It is significant, also, that the registration of the petitioner was suspended July 13, 1925, four days after he had agreed in writing to abide by the interpretation placed upon the act by the Securities Bureau. More than three months have passed, yet the Securities Bureau has not acted upon the reply of the petitioner, the only excuse for this delay being that the petitioner did not appear in person for a second hearing. This action on the part of the Secretary of Banking was unwarranted.

We cannot agree with the learned Attorney-General that the allowance of this appeal in any way interferes with the discretion of the Secretary of Banking. Had he suspended the registration of the petitioner at the time the first notice was given, there might be some merit to this contention.

Section 19 of the act (see Act of June 14, 1923, P. L. 787) provides that: "Any dealer, salesman or agent aggrieved by any decision of the commissioner may file within thirty days thereafter in the Court of Common Pleas of Dauphin County a petition against the commissioner officially as defendant, alleging therein in brief detail the action and the decision complained of, and praying for a reversal thereof.

We think the petitioner has been aggrieved by the undisputed proceedings which appear upon this record. Either the order of July 13, 1925, suspending the registration of the petitioner and signed by Fallows, was a decision of the Secretary of Banking or it was not. If it was not-if Fallows had no authority under the act to issue the order-and we think he had no such authority-then the petitioner has never been lawfully suspended. If the

Wallace v. Cameron, Secretary of Banking.

order did constitute a decision of the Secretary of Banking, then it was a decision contemplated by section 19 of the act, for which this plaintiff is aggrieved. The motion to strike off the appeal should be dismissed.

Conclusions of law.

1. The motion of the Attorney-General to dismiss the petition of the plaintiff is overruled.

2. The Secretary of Banking is directed to answer the petition of the plaintiff in the manner provided in section 19 of the Securities Act.

From Sidney E. Friedman, Harrisburg, Pa.

Railroad Police.

Railroad police-Powers-Where exercised—Act of Feb. 27, 1865.

1. Policemen appointed under the Railroad Police Act of Feb. 27, 1865, P. L. 225, and similar acts, have all of the powers of policemen of the City of Philadelphia within the counties in which they are qualified to act.

2. Such powers may be exercised either on or off the property of the corporation upon whose application they have been appointed, but always and only within the counties in which their respective commissions have been recorded pursuant to law.

3. Such special policemen are not under the control of municipal or other authorities, and are not subject to the call of such authorities.

Department of Justice. Opinion to Major Lynn G. Adams, Superintendent, Pennsylvania State Police.

CAMPBELL, 1st Dep. Att'y-Gen., Feb. 24, 1926.-You have requested to be advised (1) as to the powers of special policemen appointed under the provisions of the Act of Feb. 27, 1865, P. L. 225, relative to the performance of police duty off of and away from the property of the corporation upon whose request such officer was appointed, including his right to perform such duties outside of the county or counties in which his commission is recorded; and (2) if such officer is subject to call from municipal and other authorities to perform police duties off and away from the property of such corporation. The Act of Feb. 27, 1865, P. L. 225, authorizes the Governor, upon application of a railroad corporation, to appoint and commission the persons named in such applications as policemen to act as such for said corporation. The act provides that compensation for such services shall be paid by the petitioning corporation.

Section 3 of the act is as follows: "Every policeman, so appointed, shall, before entering upon the duties of his office, take and subscribe the oath required by the 8th article of the Constitution, before the recorder of any county through which the railroad, for which such policeman is appointed, shall be located; which oath, after being duly recorded by such recorder, shall be filed in the office of the Secretary of State, and a certified copy of such oath, made by the recorder of the proper county, shall be recorded, with the commission, in every county through or into which the railroad, for which such policeman is appointed, may run, and in which it is intended the said policeman shall act; and such policeman, so appointed, shall severally possess and exercise all the powers of policeman of the City of Philadelphia, in the several counties in which they shall be so authorized to act as aforesaid; and the keepers of jails or lock-ups or station-houses in any of said counties are required to receive all persons arrested by such policemen for the commission of any offence against the laws of this Commonwealth upon or along

Railroad Police.

said railroads, or the premises of any such corporation, to be dealt with according to law."

By supplements and amendments thereto the provisions of this act have been extended to certain other corporations.

1. It clearly appears that the purpose of this appointment is the protection of the property of the corporation which requests the appointment, but it also appears that the powers given these policemen are co-extensive with the powers of policemen of the City of Philadelphia, and that the only limitation upon the exercise of such powers is that they shall not extend beyond the county or counties within which the individual policeman has been qualified to act by the filing of his commission and a copy of his oath of office with the recorder of the county.

The case of Finfrock v. Northern Central Ry. Co., 58 Pa. Superior Ct. 52, involved the question of the liability of the defendant, a railroad policeman, to respond in damages for an unlawful arrest for an offence against the laws of the Commonwealth, alleged to have been committed on the railroad premises, where such policeman held no other position under the company, and where the arrest was not directed or instigated by any officer or employee of the company. In that case (page 59) the court quotes with approval from the case of Tucker v. Erie Ry. Co., 69 N. J. L. 19, construing a similar statute of New Jersey, inter alia, as follows: "It is plain, from a reading of the provisions of this statute, that, although these men were appointed on the application of the defendant company, received their compensation from it, and were subject to be divested of their powers by its act, they were, nevertheless, state officers, charged with the performance of public duties. They were, in law, police officers, constables, authorized to arrest persons guilty of criminal offences or breaches of the peace, not only in cases where the property of the company was involved, but in every case where the crime was committed or the peace broken within the boundaries of any of the counties through which the company's railroad ran. For the proper discharge of their official duties, as well as for the proper exercise of their official powers, they were responsible, not to the defendant company, but to the state.

The Superior Court in that case, on page 59, after reciting the fact that such policemen receive their appointment from the Governor, and are required to take and subscribe an oath to support the Constitution of the Commonwealth and perform the duties of the office with fidelity, says: "These considerations lead strongly to the conclusion that the policeman presumptively acts as a public officer and not as the servant or employee of the railroad company. It is true he may be both, as was Geiselman, and in such a case a different question may arise."

In an opinion of this department, rendered to the Governor under date of June 12, 1918, as reported in 28 Dist. R. 214, it is stated with reference to the special policemen appointed under the aforesaid act that it does "not create them police officers of the Commonwealth, but police officers for the several corporations asking for their appointment, conferring upon them like powers as are possessed by police officers of the Commonwealth."

You are, therefore, advised that the policemen appointed under the aforesaid Act of 1865 and similar acts have, during the continuance of their commissions, all of the powers of policemen of the City of Philadelphia within the counties in which they are qualified to act, which powers may be exercised either on or off the property of the corporation upon whose application they have been appointed, but always and only within the counties in which their respective commissions have been recorded pursuant to law.

Railroad Police.

2. These policemen, having accepted a commission from the Governor granting to them all the powers of policemen in Philadelphia, should be held to have accepted that commission subject to a liability for the performance of such duties, punishable for failure to perform the same. It must be remembered, however, that the paramount duty of such officers is the performance of police duty in connection with the property of the corporation upon whose application they have been appointed, and that they cannot be required to perform other independent police duty so as to interfere with the performance of these paramount duties.

You are, therefore, advised, in answer to your second inquiry, that the special policemen are not under the control of the municipal and other authorities, and are not subject to the call of such authorities, but that they have the same responsibility with reference to the enforcement of the law as have city policemen or constables in connection with violations which occur within their view. From C. P. Addams, Harrisburg, Pa.

Ligonier Borough v. Deeds.

Constitutional law-Local and special acts-Act of March 29, 1923. 1. The Act of March 29, 1923, P. L. 47, does not violate article iii, section 7, of the Constitution, which provides that the general assembly "shall not pass any special or local law authorizing the creation, extension or impairment of liens." 2. It cannot be asserted that the act is a local or special law inasmuch as it is not applicable to cities as well as boroughs.

Road law-Municipal liens for paving-State highway—Acts of May 16, 1923, P. L. 207, and March 29, 1923.

3. The appointment of viewers to assess upon abutting property benefits resulting from the paving of a street is not a condition precedent to a valid assessment of such benefits.

4. Where a borough agrees with the State Highway Department to pay a part of the cost of paving a borough street on a state highway, and the borough takes no steps to assess benefits upon abutting property until four years afterwards, and after the passage of the remedial Act of March 29, 1923, P. L. 47, when it passes an ordinance assessing benefits according to the foot-front rule, such ordinance is valid, and the assessments thereunder may be collected from owners of abutting property.

5. The foot-front rule in the built-up portion of a city or borough is not objectionable.

6. The fact that a borough has not paid its proportionate share of the costs of paving a state highway within the borough limits is not a ground for striking off a lien filed by the borough against property abutting on the highway for benefits received by the improvement.

7. A municipal claim need not set forth the enactment of an ordinance authorizing the paving of a street.

8. The legislature has authority to enact remedial legislation, authorizing the filing of a lien for paving, four years after the completion of the improvement. Rule to show cause why municipal lien should not be stricken from the record. C. P. Westmoreland Co., M. L. D., No. 8847.

Gregg & Gregg, for plaintiff; Marker & Rial, for defendant.

WHITTEN, J.- By virtue of an Ordinance of the Borough of Ligonier, approved Sept. 26, 1918, said borough agreed to pay to the State Treasurer 25 per cent. of the cost of paving and improving a certain portion of Main Street in said borough, which portion of Main Street constituted a section of State Highway Route No. 119, such improvement to be made in the same