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guage of the will does not peremptorily require an absolute sale, the executor may not raise the money required, by a partial sale or mortgage of the assets. Accordingly this proposition is broadly laid down by Lord Hardwicke in Mead v. Lord Orrery (h), and yet more broadly and expressly so by Lord Thurlow in Scott v. Tyler(i), and has been since recognized by Lord Eldon in M'Leod v. Drummond (k). Lord Loughborough, indeed, is reported to have said, that a mortgage is not a natural way of raising money, and that it may lead to an inquiry as to the circumstances of the testator's estate (1); but this observation, it is conceived, must be considered as applying to transactions attended with circumstances exciting suspicion of fraud. The right of executors to mortgage is undoubted.

An administrator durante minoritate has all the powers of an ordinary executor (m).

The mortgage may be either of legal or equitable assets (n), or of mere choses in action (i), and may be by actual assignment, or by deposit (i); and a dealing with one of many executors will be valid, for each is competent (i), and one executor may open a separate account with a banker on the executorial account, and validly pledge securities of the estate with him (o). The deed of mortgage need not state that the money is wanted for the purposes of the will, for, in order to vitiate the security, it must be shown that the money was not for the payment of debts (p). Nor is the mortsee to applica- gagee bound to see to its application (q), although Lord Kenyon tion of money. expressed an opinion that a trust might be so framed as to call on

Mortgagee

not bound to

a purchaser from an executor to see to the application of the money (p); but this observation must also, it is conceived, be supposed to apply to a sale made under very peculiar circumstances, and not for the purpose of the payment of debts generally.

A mortgage of leaseholds by an administrator, to raise money for repairs which the lessee is not bound to do, is void (s).

(h) 3 Atk. 239; Scott v. Tyler, Dick.
724; M'Leod v. Drummond, 17 Ves. 154;
Re Cooper, 20 Ch. D. 611, C. A.
(i) Scott v. Tyler, sup.
(k) Sup.

(1) Andrew v. Wrigley, 4 Bro. C. C.

138.

(m) Re Cope, 16 Ch. D. 49, Jessel, M. R. (n) Nugent v. Gifford, 1 Atk. 463; and see 17 Ves. 167.

(0) Child v. Thorley, 16 Ch. D. 151, Jessel, M. R.

(p) Bonney v. Ridgard, 4 Bro. C. C. 138, cited; 1 Cox, 145; 7 Ves. 167, cited.

(a) Scott v. Tyler, sup. ; Elliot v. Merryman, Barnard. 78.

(s) Ricketts v. Lewis, 20 Ch. D. 745,

Fry, J.

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A pledge of assets to a creditor is valid, though the estate is insolvent (t).

If the executor is also specific legatee, a mortgage from him of Executor legatee. the specific legacy for satisfaction of his private debt will be safe, unless it can be shown that the mortgagee knew that there were debts of the estate unpaid (u).

In a case, however, where an administrator mortgaged leaseholds with a power of sale to secure a sum advanced to the testator on a deposit of the title deeds, and a further sum advanced to the administrator for payment of debts, Sir J. Knight Bruce refused specific performance against a purchaser from the mortgagee, on the ground that he could not decide on the validity of the power of sale in the absence of the administrator and the cestui que trust (x).

An administrator can make an underlease; but an option to purchase in it is extra vires (y).

(2.) Fraudulent mortgages by executors.

Fraud or covin, however, will vitiate any transaction, and turn it to a mere colour. If one concerts with an executor, by obtaining the testator's effects at a nominal price, or at a fraudulent undervalue, or by applying the real value to the purchase of other subjects for his own behoof, or in extinguishing the private debt of the executor, or in any other manner contrary to the duty of the office of executor, such concert will involve the seeming purchaser or pawnee, and make him liable to the full value (≈).

Bona testatoris cannot be taken in execution under a fi. fa. in satisfaction of the executor's private debt (a).

311

residuary legatee. Mortgage for

In two leading cases in equity (b), Lord Hardwicke supported Executor— assignments of the testator's assets, made by the executor in satisfaction of his own debt or for his private purposes. But in the first the executor was also sole residuary legatee, and in the other a residuary legatee was interested. These two cases depended on

(t) Earl Vane v. Rigden, 5 Ch. 663. (u) Taylor v. Hawkins, 8 Ves. 209. (x) Sanders v. Richards, 2 Coll. 568. But see Russell v. Plaice, 18 Beav. 21; 18 Jur. 254; Cruikshank v. Duffin, 13 Eq. 559, V. C. Malins.

(y) Oceanic Steam, &c. Co. v. Sutherberry, 16 Ch. D. 236, C. A.

(z) Scott v. Tyler, sup.; Re Brettle, 2

De G. Jo. & Sm. 244; overruling Whale
v. Booth, 4 T. R. 625, note. And see
Doe v. Fallows, 2 C. & J. 483; 2 Tyrwh.
462; Wms. Ex. 746.

(a) Farr v. Newman, 4 T. R. 621;
M'Leod v. Drummond, 17 Ves. 161;
overruling Whale v. Booth, sup.

(b) Nugent v. Gifford, sup.; Mead v. Lord Orrery, sup.

his own purposes.

Delay in complaints.

Mortgage partly for private purposes.

Notice.

particular circumstances (c); the principles contained in them have been disapproved of and overruled in subsequent cases (d).

In M'Leod v. Drummond (e), relief was refused on a bill filed by two co-executors in Scotland, who had never acted, but had permitted the other two executors in England to manage the property for a great length of time. The acting executors, many years after the testator's death, pledged some bonds belonging to him with their bankers, to secure advances made to them as army agents, representing that an account was kept between them and the estate, to which they were, or frequently might be, in advance. The M. R. dismissed the bill, and on appeal to the L. C. the decree was affirmed under the peculiar circumstances of the case.

Relief will also be refused if there has been great delay on the part of the legatees in making a claim, even although they have but a contingent or expectant right, for such an interest will entitle them to know what debts the testator owed, and what part of his estate has been applied to the payment of them (ƒ).

Where a mortgage is partly for the estate, and partly for private purposes, the onus falls on the borrower to show how far it is valid (g). A mortgage of a part of the assets by an executor for a debt originally contracted on his personal security and without reference to assets was held valid (h).

What circumstances amount to notice that the mortgage is for the executor's own purpose, see (i). The notice must be clear (). The fact of the mortgage including the executor's own property as well was held not to be sufficient (1). The assignee of an administrator mortgaging under a power for a particular purpose from the next of kin, should give notice to the next of kin (m).

Although a lien on specific assets of the estate may be valid, though it is to secure the private debt of the executor, if the mort

(c) See Taner v. Ivie, 2 Ves. S. 466.
(d) Bonney v. Ridgard, 4 Bro. C. C.
138, cited, 1 Cox, 145; Crane v. Drake,
2 Vern. 616; Andrew v. Wrigley, 4 Bro.
C. C. 138; Hill v. Simpson, 7 Ves. 152;
Scott v. Tyler, Dick. 724.

(e) 14 Ves. 353; and see 17 Ves. 170;
8 Sim. 260.

(f) Andrew v. Wrigley, sup.

(g) Carter v. Sanders, 2 Drew. 248.

(h) Miles v. Durnford, 2 De G. M. &

G. 641.

(i) Collingwood v. Russell, 10 Jur. N. S. 1063, L. J.; Howard v. Chaffers, 2 Dr. & Sm. 236; 9 Jur. N. S. 767; Farhall v. F. 7 Eq. 286, V. C. James; reversed, 7 Ch. 123.

(k) Collingwood v. Russell, sup.

(1) Barrow v. Griffith, 11 Jur. N. S. 6, V. C. Stuart.

(m) Jones v. Stöhwasser, 16 Ch. D. 577, V. C. Bacon.

SECT. 2.

FRAUDULENT MORTGAGES BY EXECUTORS.

gagee have no notice, yet the latter, on failure of the security, cannot prove against the estate (n).

Where a devisee-executor deposits the title-deeds of his testator's estate, in which he has only a partial interest, to secure his own debts, the deposit only affects his own interest (o). A settlement by the executor, being specific legatee of leasehold, on his marriage, binds the creditors (p).

If a particular fund is pointed out by the will for the payment of debts, it may become necessary for a mortgagee to inquire if that fund has been exhausted.

The result of the cases seems to be, that if a purchaser or mort- Result of gagee advance money to an executor (even though the executor be cases. also residuary legatee), for purposes which he knows to be foreign to the will (q), or if he takes, as a security for the executor's private debt, part of the testator's assets, he does it at his own risk, and is liable to a suit for relief on action brought either by a creditor, or by a pecuniary, specific, or residuary legatee, if such legatee pursue his remedy within a reasonable time. If the executor is also specific legatee, a mortgage from him of the specific legacy in satisfaction of his private debt will be safe, unless it can be shown that the creditor knew there were debts unpaid (r).

(3.) Mortgage by devisee charged with debts.

Where real estate is devised specially charged with the payment of debts, the devisee has power to mortgage the real estate and give a receipt for the mortgage money (s). Of course, where there is collusion between the devisee and the mortgagee, and the mortgage is effected by the former for his own purposes to the knowledge of the latter, the mortgage would not be valid (†). The fact of the devisee being also executor in most of the cases was adverted to by the L. C. (u); but it is apprehended that, in the absence of any special circumstances, a devisee, though not execu

(n) Farhall v. F. sup.

(0) Haynes v. Forshaw, 11 Ha. 93; 17 Jur. 930.

(p) Spackman v. Timbrell, 8 Sim. 260. (9) See Downes v. Power, 2 Ba. & Be. 498; Collinson v. Lister, 20 Beav. 356; 1 Jur. N. S. 835; 7 De G. M. & G. 634; 2 Jur. N. S. 75.

(r) Taylor v. Hawkins, 8 Ves. 209.

(s) Colyer v. Finch, 5 H. L. 905; Corser v. Cartright, 8 Ch. 971; 7 H. L. 731.

(t) Walker v. Taylor, 8 Jur. N. S. 681, H. L.

(u) Corser v. Cartwright, sup.; 7 H. L. 736; West of England Bank v. Murch, 23 Ch. D. 138, Fry, J.

313

Mortgage subject to legacies.

Specific sums for debts.

Charge of debts and legacies.

Lapse of time.

tor, can mortgage; for it is clearly his duty to satisfy the debts which the mortgage may be the very means to enable him to do.

If an estate is devised subject to debts and legacies, a mortgagee advancing money to the devisee, although also the executor, is liable to the charge if the circumstances of the case afford intrinsic evidence, or it otherwise appear, that the mortgage money is not to be applied in payment of debts and legacies, but for the private purposes of the mortgagor (u).

And if in the case of a similar devise, a mortgage is made by the devisee expressly subject to the legacies, and on the money being called in by the mortgagee, a transfer is made to a third party with a confirmation by the mortgagor, to whom a further advance is made, but the transfer is not expressed to be made subject to legacies, the party advancing the money being falsely informed of their being satisfied, yet he will take subject to the legacies, as by the conveyance he has gained the same estate as was held by the first mortgagee (x).

If estates are devised charged with specific sums to the executors for payment of debts, a mortgagee is bound to see to the application of the mortgage money, notwithstanding releases have been executed to the devisees by the executors, but which did not show the charges to have been raised or paid (y).

It is settled that a general charge of debts and legacies, including annuities, on real estate, renders a purchaser or mortgagee from the devisee safe from seeing to the application of the purchase or mortgage money so long as any part of the trust is unperformed, although the purchaser or mortgagee is aware that all the debts have been paid; the rule depending on the state of things at the testator's death and being unaffected by a subsequent change of circumstances (z).

But where money is proposed to be raised after a considerable lapse of time, and without apparent reason, the mortgagee is bound to make proper inquiry (a). A period of twenty years is now made a fixed rule (b).

(u) Corser v. Cartwright, 8 Ch. 971;
7 H. L. 726; West of England Bank v.
Murch, 23 Ch. D. 138, Fry, J.

(x) Rogers v. R. 6 Sim. 364.
(y) Braithwaite v. Britain, 1 Keen,
206. But see 11 Jur. Pt. 2, p. 113.

(z) Forbes v. Peacock, 11 Sim. 152; 1
Ph. 717; 11 M. & W. 639; Eland v. E.

4 My. & Cr. 420; Page v. Adam, 4 Beav. 269; Storey v. Walsh, 18 Beav. 559; 18 Jur. 503.

(a) Stroughill v. Anstey, 1 De G. M. & G. 635; 16 Jur. 673; Colyer v. Finch, 5 H. L. 922.

(b) Re Tanqueray-Willaume, 20 Ch. D. 465, C. A.

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