INSOL.]

Re HENRY GREEN.

[INSOL.

heard if he can show that the adjudication has been improperly obtained. Where he has been remanded for a breach of trust on the ground that he has committed a derastavit, he will upon the rehearing be allowed to give evidence, if he can, that he was compelled as executor to make payments that would overreach the devastavit, and that he applied nothing to his own use.

The insolvent was a builder, and had many years ago been appointed executor of the will of a Mrs. Turner, who was entitled to a considerable sum of money in her own right, secured by charges upon the estate of a person named Blake in the county Galway. Mrs. Turner made certain bequests, and amongst others one to her husband and one to her son, who was then but four or five years old. It appeared that there had been a most protracted litigation about Blake's property, and the Turners as well as other legatees got nothing. In 1851 they filed a cause petition to compel Green to account as executor, and it was not until April 1859 that the master in the cause made up his final decree, by which he found that there was a sum of 2727. due to the Turners, which the insolvent was directed to pay within a month. In the mean time he was arrested by another creditor, and having filed his petition and schedule, his case came to be heard before Macan, J. on the 25th May last, when he was opposed by the Turners, on the ground that he had committed a breach of trust, the evidence of which was the decretal order of Master Murphy finding that the insolvent was bound to pay them the sum stated, and that he had committed a devastavit to that amount. On these grounds Macan, J. remanded the insolvent for twelve months; he filed an affidavit with a view to obtain a rehearing, on the ground that, although he was found legally chargeable with a devastavit, he had disbursed the funds that came into his hands for other purposes which he was bound to pay, and he ought not therefore to be punished. Upon this affidavit having been filed, and upon a communication from the master in the cause, Berwick, J. granted a rehearing, and the case having come on to be heard,

the late Macan, J. to have the assignee brought up and examined. He was brought up, and on his examination stated that he knew nothing whatever of what was going on beyond the fact of his being appointed; and that after he threatened to bring them to an account, they handed him 30%, as it were, to close the matter. Macan, J. directed that that 301. should be brought in and lodged by Fisher, who immediately after his return to the prison in Belfast, where he was still a turnkey, committed suicide. One the whole, it was one of the most painful cases that ever came before a judge to decide; but he would be grossly violating his duty to the public if he did not decide it wholly irrespective of these feelings of kindness and consideration which ought to govern a court of justice with regard to solicitors, where what was done was the result of mistake or inadvertence. That could not be said in the present case; everything done was done deliberately, and under the semblance of the law and the practice of the court; and in that respect he ought to be more rigid than if done by an ignorant assignee who knew nothing of either. It was due to the profession as well as to the public that the erring members of it should have their faults and misconduct clearly pointed out, so that they might take more care for the future, and that it might be a guide to others to prevent them falling into similar errors. In the first place he was of opinion that the misdescription of Fisher when put forward as assignee was a fraud on the court; for if he had been properly described as the turnkey of a goal, no court would have appointed him as its officer. In the second place it did not appear that the unfortunate and ill-fated man had ever done a single act as assignee, although he was sorry to say that it had been sworn to by Watersen and Dinnen that all they had done in the matter was by direction and under the control of the assignee. In the third place, notwithstanding the able argument of Mr. Heron (and no man could have done more for his clients than he did), he was not disposed to treat the matter as a mere question between attorney and client, or a mistake on the part of an attorney paying away money bona fide, O'Driscoll, for the insolvent, submitted that a devasalthough to a party who was not, in point of law or in tavit was nothing more than a deficiency on the foot of point of fact, entitled to it. He would treat the pre-accounts; but, without attempting to disturb the judgsent case as if Messrs. Watersen and Dennin were the real assignees in the matter, having illegally and improperly dealt with the insolvent's estate without the sanction of the court in a single step which they took. They paid Coates the 85., upon the mere allegation that he had the insolvent's lease in his possession, although the chief clerk reported there was nothing due to him. They attempted to retain the remainder for their costs; but, when pressed, they endeavour to get out of the whole matter by handing Fisher 301.-evidently for no good purpose. Macan, J. had ordered that that Fisher should bring in that 307.; he would direct Watersen and Dinnen should bring it in, with the right, of course, to follow the assets of Fisher if he left any. He would also direct that they should bring in the 857. alleged to have been paid to Coates, and also the 297. about which there was no di-pute; and that they should personally pay the costs of the creditors who brought forward the present motion, of whose conduct in the transaction he fully approved. Watersen and Dennin would, of course, have their remedy against Coates if they have paid him the money. It was exceedingly painful to him to make such an order; but he would be wanting in his duty to the public if he did not do so.

ment of Macan, J., who treated the case as if there had been a direct breach of trust, he was prepared to show that the insolvent had made payments out of the funds that came into his hands to a larger amount than the alleged derastavit.

Lery for the Messrs. Turner.-The decretal order was conclusive; it fixed the insolvent with a devastavit; it was open to him to have proceeded in the way of a petition of review and reversal, but he could not at that stage of the proceedings give evidence to show that he was not a defaulter to the amount found by the master.

BERWICK, J. said he would allow him to give the evidence if he could give it, and show that he paid away the money found due to the Turners for any legitimate purpose with which they were fairly chargeable, or to which he was entitled to credit.

The insolvent put in several accounts, which failed to establish the proposition he contended for.

BERWICK, J. said the case was, in his opinion, an important one; for in the first place it involved the right of an insolvent to obtain a rehearing on his own application, if, in the words of the statute, he could show that the adjudication had been obtained on false evidence or otherwise improperly obtained. Now, if the insolvent had made payments out of the fund that came into his hands, which he was bound to make, and Rehearing under the 232nd section 20 & 21 Vict. c. 60 although he was not legally entitled to them as against [English analogous, 1 & 2 Vict. c. 110, s. 91- the Turners, and that in point of fact he never approRight of insolvent to apply for rehearing-Devas-priated any of the money to his own purposes, there was nothing that ought to make him the subject of a

tavil.

Re HENRY GREEN.

An insolvent has a right to apply to have his case re- punishment so severe as twelve months' imprisonment.

VOL XXXV,—No. 869, O.S.-No. 3, N.S.

THIEDEMANN v. GOLDSCHMIDT.

He had a communication from Master Murphy, which | better, and, as we have had only fine weather for some led him to believe that the man had made payments months, we may, before harvest is secured, still have a which, although not legally entitling them to the deal of bad weather and see high prices." decree, would still exonerate him from any moral offence that should bring him under so severe a punishment. It was a great privilege to give him the opportunity of proving that fact; but having failed to do so, the original judgment of Macan, J. (with which he never intended to interfere, unless evidence came before him that, in his opinion, would have induced that learned judge to come to a contrary conclusion) should stand, and the insolvent should remain in prison until the expiration of the twelve months, unless the Turners thought proper to discharge him out of custody.

(Before the LORD CHANCELLOR (Campbell) and the be delivered to the Union Bank previously to the said

Nov. 26, 1859-REPORTS.]
CHAN.]

SABIN v. HEAP.

ROLLS.]

bills of exchange would be very much shaken, if the
title of the indorsees as against the acceptor under such
Now,
circumstances could be called in question. It is allowed
that Robinson v. Reynolds is well decided.
according to the commercial law of England, the in-
dorsees there were holders bona fide for value, and,
therefore, what happened as between the acceptor and
the drawer was not allowed to shake the title of the
There was an indepen-
indorsee. The bills there were accepted by the drawee
on the credit of the drawer.

pany had given good and valid consideration for the said bills, and were in fact purchasers of the same without notice of any fraud; that on the 28th June 1858, on the faith of the said bills, the Berlin Discount Company remitted to Messrs. Zeimsen and Wieblitz, of Stettin, the sum of 740%., who thereout took up acceptances of the said O. F. Homeyer to the amount of 4601., and carried a sum of 2807. to Homeyer's credit, who was at that time largely indebted to the said firm at Stettin; that the Berlin Discount Company also on the same or on the follow-dent transaction, whereby the bills had been indorsed ing day remitted a sum of 920l. to Homeyer in cash to to the plaintiff, and as between the plaintiff and the Holgast, and have since paid him 4607, making in the acceptor there was full value and an unimpeachable title. I apprehend that it is precisely the case here, whole 21201. The plaintiff, on the other hand, alleged that the that the banking company were indorsees bonâ fide for Berlin Discount Company had for some time pre- value: whether it was upon a discount, or whether it They did advance the viously to these transactions acted as the bankers and was advancing the value in any other way, seems to agents of Homeyer, and were well acquainted with his me to be wholly immaterial. circumstances, and were in the habit of advancing to value within a trifle of the amount of the bills him, or on his account, large sums of money on his of exchange, and having advanced that money they own individual credit, and he submitted that the ad- were the indorsees for value. Well, then, that being so, vances, if made to Homeyer, were so made to him on it must be considered that the bills were accepted by his own credit, and on the security of the alleged bill of Theidemann on the credit of Homeyer; and for that realading, and not on the security of the said bills, which son it would be most alarming if the title of the indorsee had not been then presented for acceptance. He also (he holding the bills bona fide for value) could be at submitted that the defendants Goldschmidt and Bi- all impeached. If Mr. Bacon could have made out schoffscheim must have been well aware that Homeyer that in this case the banking company had misapplied had no authority to draw the said bills except as against the bills, and were not bonâ fide holders of the bills, I the produce and on the security of a good and valid think he would have been entitled, or at least might bill of lading of the said wheat, and that the accept-have shown that an action against the acceptor might ance of the plaintiff was to be conditional only on have been defended; but I do not find that the bank They receiving such good and valid bill of lading; and inas- did anything that was at all discreditable, or that was much as Wolgast was only about fifteen hours' journey, not entirely sanctioned by commercial usage. and one day's post from Berlin, and there being a had advanced money on the faith of those bills nearly telegraph from Berlin to Wolgast, the said Berlin Dis-to the amount of the bills, and therefore they had a count Company had ample opportunity to ascertain, right to tender those bills for acceptance to the drawees, and ought to have ascertained, whether the wheat had and having then accepted they had an undoubted right been actually shipped in the vessel Anna at Wolgast to apply those bills for their own indemnity. Then before they advanced the money they had done; that being so-the principle of the case of Robinson v. and he insisted that the defendants Goldschmidt Reynolds being, that where there is an indorsee bonâ fide and Bischoffscheim, or their correspondents the Berlin for value, he has a good right to sue the acceptor, Discount Company, were answerable, for and by their though there may have been a fraud practised by the conduct, warranted the genuineness of the bill of lading; drawer-it applies just as strongly in the case which we and even were they innocent of such fraud, the accept-have now to determine. Then that being so, it seems to me that no defence is proposed to be set up to an I have no difficulty in saying that ance of the Union Bank was obtained by means of a frand practised upon him and the Union Bank, and action on the bills. that, as such, the same was wholly void as against him, there is not the smallest occasion to appeal to a the consideration for the same having failed. The de-court of equity for redress. Under these circumstances, fendant Homeyer was, on the 4th Aug.1858, committed I think the decree for the injunction ought to be reLord Justice KNIGHT BRUCE.-The appellants are for trial for forging the alleged bill of lading. The plain- versed, and that the bill should be dismissed with costs. tiff prayed for a declaration that the said several bills of exchange were drawn without any authority, and the holders of the bills in question for value, whose that the plaintiff's acceptance of the same was obtained honesty is not, nor is the propriety of their conduct, imby fraud; that the said bills might be decreed to be peached. Therefore, whatever the probability of success delivered up to be cancelled, or that proper directions or failure at law on either side, there is, I think, no might be given for preventing the same being enforced equity here, subject only to the question of the strict We are not here on demurrer, and I think, or made use of against the plaintiff or the Union Bank right to institute a suit in equity for the delivery of of London; also that the defendants Goldschmidt and the bills. Bischoffscheim might be restrained from negotiating the therefore, that that difficulty, if it is one, is well sursaid bills of exchange, or parting with them to any mounted by the undertaking given by the appellant's other persons or person except the plaintiff, and that counsel (which will, I suppose, be embodied in an order), they and the Berlin Discount Company might be that, in the event of judginent at law being against restrained from prosecuting any action against the them, the bills shall be delivered up to the plaintiff, plaintiff or the Union Bank of London on the said bills who would, I suppose, in that event, be the person enbe dismissed with costs; but I do not think there ought of exchange. Stuart, V.C. granted the injunction, and titled to them. That being done, I think the bill should from this decision the defendants now appealed. Lord Justice TURNER concurred. to be any costs of the appeal.

Bacon, Q.C. and Hetherington, for the plaintiff, the respondent, opened the case, the appeal being from the whole decree.

Malins, Q.C. and Ferrer for the defendants, the
appellants.

The following cases were referred to:-Robinson v.
Reynolds, 2 Q.B. 196; Jones v. Ryde, 5 Taunt. 488.

ROLLS COURT.

Reported by GEORGE WHITELEY, Esq., of the Middle Temple,
Barrister-at-Law.

Nov. 16 and 17.
SABIN v. HEAP.

The LORD CHANCELLOR.-I am of opinion that this injunction has been improperly granted. I think the most alarming danger would arise, and the credit of Will-Charge of debts-Implied power of sale-Exer

cise of power after great lapse of time-Limit of period. Where a testator had expressly directed payment of his debts, and the executor, after a lapse of twenty-seven years from the death of the testator, exercised the implied power of sale thereby given, although the parties beneficially entitled had been in possession, by the permission of the legal representative, for nine years, and the executor refused to answer a requisition whether there were any debts of the testator still unpaid, the Court refused to disturb the rule established in Forbes v. Peacock, 1 Phil. 717, and other authorities, that the executor in such a case can, without showing that there are debts unpaid, make a good title to the property sold, and absolve the purchaser from liability to see to the application of the purchase

money:

Semble, that there is a limit of time at which it must be held that the debts of the testator have been paid, and when it would be difficult to make a good title upon a sale under such power.

Thomas Fereday made his will, dated 3rd March 1832, commencing as follows:-"First, I direct that all my just debts, funeral and testamentary expenses, and the costs, charges and expenses of proving and executing this my will, shall be paid and discharged;" and then the testator devised his freehold estate, together with certain leasehold premises, and the rest of his personal estate, to Edward Fereday, his heirs, executors, administrators and assigns respectively, as to three-fifths, upon certain trusts for the benefit of certain persons, in certain shares, and as to the remaining two-fifths, for his own use and benefit. The will contained a power to the said Edward Fereday, at his discretion, to make partition or dispose of, either by way of absolute sale, or in exchange for other hereditaments, all or any of the said freehold hereditaments and premises thereinbefore devised, and that for that purpose it should be lawful for the said E. Fereday, his heirs, executors or administrators, by any deed executed and attested in the manner therein mentioned, to make and determine the uses, trusts, powers, provisions and declarations thereinbefore declared concerning the said freehold hereditaments proposed to be partitioned, sold or exchanged." And the testator declared that the receipt of the said "E. Fereday, his heirs, executors or administrators," should be a sufficient discharge to any person paying his purchasemoney on any sale of the said hereditaments, and he directed the money to arise from any such sale to be laid out in the purchase of other lands, to be settled to the same uses as the lands sold. The will also contained a power to the said E. Fereday, by any deed or instrument under his hand and seal, to appoint a trustee or trustees in his stead, and directed that all the said trust estate should be conveyed and transferred in such manner that the same should be legally vested in the new trustee or trustees, upon the trusts thereinbefore declared concerning the same, and such trustee or trustees "should have all the powers and authorities of the said E. Fereday." And the testator appointed the said E. Fereday executor of his said will. The said testator died on the 4th March 1832. The will was proved by the said E. Fereday.

Edward Fereday, by his will dated in 1848, duly executed and attested, devised all estates vested in him upon any trust to, the plaintiff Frederick Fereday Sabin and William Henry Sabin, their heirs, executors, administrators and assigns respectively, "upon trust to hold or dispose of the same in the manner in which they ought to be held or disposed of pursuant to the said trusts;" and he appointed the said Frederick Fereday Sabin and Wm. Henry Sabin executors of his will. The testator died in 1850, and the plaintiff's proved the will.

[ROLLS.

Since the death of E. Fereday the parties beneficially interested in the said testator's real estate have been in the receipt of the rents and profits, with permission of the legal representative of the testator.

In May 1859 the executors of the said E. Fereday entered into an agreement for the sale of the said hereditaments to the defendant, but the defendant declined to complete, alleging that the plaintiffs have no power to sell the said hereditaments, either as such trustees, or as such legal personal representatives of the said Thos. Fereday.

The plaintiffs decline to state, in answer to a requisition made by the purchaser, whether any of the debts of the testator T. Fereday remain unpaid. were first, whether the plaintiffs could make a good The questions stated for the opinion of the court title as trustees of the will of the said T. Fereday under the express power contained in the will; or secondly, whether they could make a good title as legal personal representatives of the testator under the implied power of sale for the payment of debts created by the charge of debts; and thirdly, by whom the costs of this application ought to be paid.

Speed, for the plaintiff, the personal representative of the testator, on the second question (which was argued first) contended that, according to the settled rule, the plaintiff could make a good title to the purchaser under the implied power of sale created by the charge of debts in the testator's will. He cited Elliott v. Merryman, Barnard. 78; Shaw v. Borrer, 1 Keen, 577; Ball v. Harris, 4 Myl. & Cr. 464; Gosling v. Carter, 1 Coll. 644; Mather v. Norton, 16 Jur. 309; Robinson v. Lowater, 17 Beav. 592; S.C. 5 De G. M. & G. 272; Eidsforth v. Armistead, 2 K. & J. 333, Forbes v. Peacock, 1 Phil. 717; which last cases also established the rule that the executor was not bound to answer a question whether there were any debts of the testator unpaid at the time of the sale. With respect to the question of the time which had elapsed since the death of the testator, it was less than in Forbes v. Peacock, where it was twenty-eight years; and in Wrigley v. Sykes, 21 Beav 337, where it was thirty-three years. He also cited Johnson v. Kennett, 3 Myl. & K. 631; Page v. Adam, 4 Beav. 469.

E. F. White, for the purchaser, admitting the general rule, contended that, where from the circumstances under which the sale was made, it was clear that there was no reason for the sale in order to pay debts, the rule did not apply. He cited the observations of Lord St. Leonards in Stroughill v. Anstey, 1 De G. M. & G. 654, that "people who deal with trustees raising money at a considerable distance of time, and without any apparent reason for so doing, must be considered as under some obligation to inquire and look fairly at what they are about. I do not thus mean to lessen the security of purchasers or mortgagees under trusts; but if for a great number of years a trust such as that here remains unperformed, and parties are found in possession and receipt of the rents of the trust property, and then an application is made of it, without their concurrence, by the trustees, it may place those who deal with the trustees in a situation of having it established that there was a breach of trust of which they ought to have taken notice." In this case the trust has been unperformed for twenty-seven years; the executor is dead, and the parties beneficially entitled have been in possession of the property since 1850 by the permission of the legal representative; and there is no suggestion that this sale is necessary in consequence of the existence of debts of the testator's unpaid. In almost all the cases cited, the sale took place shortly after the death of the testator; so also in Storry v. Walsh, 18 Beav. 559. In Forbes v. Peacock, where a long period had elapsed from the death of the testator before the sale took place, there was this difference, that, in addition to the

In

charge of debts contained in the will, there was an express direction that the property, if not previously sold, should be disposed of at the death of the testator's wife, which was the period at which the sale was made, and the proceeds divided amongst certain persons; therefore a sale was necessary in any event. Wrigley v. Sykes, where thirty-three years elapsed before the sale was made, there were debts of the testator then in existence. So in Robinson v. Lowater, where a long period had elapsed, a particular debt of the testator, with payment of which he charged his estate, was still unpaid at the time of the sale. There must be some limit ultimately fixed by decision of the court, beyond which a sale under such a power would not be good, unless the legal representative could show an existing debt. He contended that the present case exceeded the proper limit. The case was at least so doubtful, that the court could not force the title on a purchaser: (Collard v. Simpson, 4 De G. M. & G. 224.)

[M. R.

can be made under the implied power of sale created by the charge of debts in the will. The defendant must pay the costs of this application.

On the 1st

In a suit for administering the estate of Jeremiah Bunny, a claim was brought in by Richard Shaw, claiming to be a specialty creditor, for the sum of 32007. The testator was scised of a piece of freehold building land at Donnington, called the Clay-pit field, containing 9a. 3r. 4r., and which now forms the site of Donnington-square. In 1850 the testator conveyed a part of the land to Francis Masters, on which he built four houses, Nos. 1, 2, 3 and 4. This property ultimately became vested in Henry Bunny. Jan. 1852 the testator, by indenture of that date, in consideration of 4300, conveyed to H. Bunny the remainder of the said piece of land, and by such indenture covenanted, for himself, his heirs, executors and administrators, with the said II. Bunny, his heirs and assigns, for quiet enjoyment of the premises "without let, suit, trouble, denial, eviction, interruption, claims and demands whatsoever from the said testator or any person or persons legally or equitably claiming, or to claim, by, from, under or in trust for him," free from incumbrances.

In April 1852 H. Bunny conveyed the land and houses purchased from the testator and the assignees of Masters, and also other portions of the said land, and four other houses, Nos. 20, 21, 28 and 29, erected thereon, to the Solicitors' Life Assurance Society, as security for 4000l. By indenture of 16th Oct. 1853 H. Bunny, for 5004, conveyed to Shaw (the claimant) the equity of redemption of the property mortgaged to the Life Assurance Society; and by two other indentures, dated the 17th Oct. 1857, H. Bunny, in consideration of 6000%. and 30007., conveyed all the residue of the said land, and four other houses then built thereon, numbered 14, 15, 16 and 17, to the said R. Shaw, and entered into the usual covenant for title, including a covenant for quiet enjoyment against all claims and demands from or by him or any person or persons lawfully or equitably claiming, or to claim, by, from, through, under or in trust for him, free from incumbrances.

The MASTER of the ROLLS.-I have looked through the authorities upon the question argued in this case and considered it very carefully; and it is due to Mr. White to say that I consider the point principally urged by him of very great importance. I think that in these cases, in which there is in a will an implied power of sale created by a charge of debts, there must be a linit of time at which the court must hold that the debts have been paid, and that it would be difficult to make a good title upon a sale under such a power. There may possibly be cases in which there has been such a power unexercised for a long period of time from executor to executor, and there has been enjoyment of the property by the parties beneficially entitled: when so, the power, it would seem, could not be properly exercised; but I do not pretend to fix what ought to be the limit, and I am satisfied that it does not exist in a case like the present, when only twenty-seven years have elapsed since the death of the testator. I have had many cases before me, where the executors believed that all the debts were paid, having taken all the steps which were possible to ascertain the debts, and had divided the residue, where debts have after wards risen up, which had, in fact, no existence at the death of the testator, but arose out of liabilities of the testator at a period subsequent to such division. It is clear, therefore, that a very liberal limit must be given to such a power. The cases have decided that an executor, in making a sale under such a power, is not bound to answer whether or not there are any debts of the testator existing; and although the case of Forbes y. Peacock inay be partly open to the observations made by Mr.White upon it, yet I must not fail to observe that in that case a long period of time had elapsed from the death of the testator before the sale was made, and there Lord Lyndhurst thought that the purchaser could not enforce an answer to a question whether there The testator had previously, on the 1st May 1851, were any debts. I am of opinion that this is so in the conveyed the piece of land forming the site of the present case, and that it would unsettle titles, and also houses, Nos. 14, 15, 16 and 17, to one John Dyne, in fee, the rules of this court on this question, if I were to and which formed part of the property conveyed to decide that, in this case, the legal personal representa-Shaw in consideration of the said sum of 6000l. In tive has not power to sell and absolve the purchaser 1853 Shaw was evicted from the possession of the said froin liability to see to the application of the purchase-houses, 14, 15, 16 and 17, Donnington-square, and he money. If this were a bill for specific performance, I should make a decree for the plaintiff, with costs; and I am of opinion that I must answer this case in that way. I may observe that the judgment of Lord St. Leonards in Stroughill v. Anstey confirms, instead of shaking, my view of this point. He states the importance of not shaking titles; and although he states the necessity of observing caution in dealing with trustees who are raising money at a considerable distance of time from the death of the testator, and without any apparent reason for so doing, he says that he does not thus mean to lessen the security of purchasers Beales, for a legatee, contra, cited Lewis v. Campbell, under a trust. I must therefore hold that a good title | 3 Taunt. 715; S. C. 3 B. & Ad. 392.

put in his claim in chambers to be a specialty creditor
for 32001, the present value of the property, with the
houses built thereon. The chief clerk allowed the claim,
subject to the opinion of the court, whether, under the
said facts, he was entitled to recover only a proportionate
part of the original purchase-money paid to the testator,
or the full value of the improvements thereon by the
erection of houses thereon subsequent to the conveyance
thereof by the testator to Bunny.

Bagshaw, Q.C. for the plaintiff.
Follett and W. Morris for Shaw.