Oppenheim v. Leo Wolf.

thought the rule ought to be, if the vessel did not arrive within the usual limits of the voyage she was prosecuting, she ought to be presumed to be lost; and that it would not be reasonable to calculate on the utmost or greatest limit of the voyage; and he left it to the jury to say whether the Almira was probably lost before the expiration of the policy on the 28th of March. The jury gave a verdict against the underwriters, and the court sustained the charge and the verdict. In the case cited, the action was not brought till after March, 1802; thus affording to the underwriters, a whole year for it to become perfectly certain that a loss had been sustained.

These authorities fully confirm my conviction that the steamer President must be deemed to have been lost before May, 1841, and that Joseph Leo Wolf's death must have occurred before his attorney transferred this fund to his father.

The death of the constituent terminated the attorney's authority, and his transfer was nugatory. The result is, that the surplus of the securities in the complainant's hands, was assets of Joseph Leo Wolf when he died, and must be paid over to his administrator.

Under the circumstances, I will not charge W. Leo Wolf with costs. The administrator will be allowed his costs out of the fund recovered.

Brewer v. Staples.

BREWER V. STAPLES and others.

THE purchaser of land which is conveyed to him subject to a mortgage executed by the vendor, is not entitled to the benefit of a collateral security which the vendor placed with the mortgagee subsequent to the execution of the mortgage. After such a conveyance, the land becomes the primary fund for the payment of the mortgage debt, and the personal liability of the mortgagor is the secondary fund. The mortgagor stands, in respect of the land, as a surety for the mortgage debt..

A creditor taking from his debtor in compromise and satisfaction, a conveyance of land subject to a mortgage thereon, ceases to be a creditor, and becomes a purchaser of such land; and he cannot compel the debtor to pay the mortgage. S. having mortgaged his lands to B., subsequently transferred to B., a debt against Q. as a collateral security. Afterwards, S. being largely indebted to T., compromised the debt for less than its amount, and paid it by conveying to T. the same lands, expressly subject to the mortgage to B. Held, that T. had no right to require B. to collect Q's debt, and apply it to the satisfaction of the mortgage; that the land was the primary fund; and that S. could require B. to exhaust it before resorting to Q's debt, which was collateral to the mortgage.

April, 6; June 1, 1846.

THE bill was filed January 20, 1845, against William J. Staples, The Trust Fire Insurance Company, and others, to foreclose a mortgage executed by Staples to James H. Titus, on four lots of ground at Stapleton on Staten Island. The mortgage was dated September 15, 1846, was for $1500, and was accompanied by Staples's bond of the same date and tenor. Titus assigned the bond and mortgage to the complainant, prior to April, 1840, and she claimed $1200, of the principal to be due.

At the date of this mortgage, Staples executed a bond and mortgage to one Thurston, on five lots adjacent to the former; and Thurston assigned his bond and mortgage to Peter Embury. On the third day of April, 1840, for the further security of the debts to the complainant and Embury respectively, Staples assigned to E. Seeley, Esq. in trust for them, and as collateral to those debts, a bond and mortgage which he held, executed by one Quin. In 1841, Seeley foreclosed the Quin mortgage in chan

Brewer v. Staples.

cery, and in behalf of the parties interested in it, bid off the mortgaged premises at the master's sale, for $780. But the sale was never consummated, nor any deed given.

Staples being largely indebted to The Trust Fire Insurance Company, negotiated a settlement and compromise of the debt, offering lands in payment. Before effecting an arrangement, he proposed to add to his offer, the nine lots mortgaged to Titus and Thurston, subject to those mortgages. The compromise was finally made on that footing, and on the 29th day of May, 1843, Staples conveyed to the company, together with other lands, the nine lots before mentioned, subject to the respective mortgages thereon, viz., that to Titus on four, and the mortgage to Thurston on the remaining five; upon which the company discharged their demands against Staples. The lands conveyed by him, after deducting incumbrances, were not worth as much as his debt to the company. And at the time the testimony was taken in this suit, the deficiency exceeded the amount of Quin's mortgage.

The Trust Fire Insurance Company put in an answer to the bill, setting up most of these facts, and insisting that the complainant was bound to exhaust the security afforded to her by the Quin mortgage, before selling the four lots mortgaged by Staples to Titus. The bill was taken as confessed against all the other defendants. The cause was heard on the pleadings. and proofs, as to The Trust Fire Insurance Company.

A. C. Bradley, for the complainant, made the following points. 1. The defendants, the Trust Fire Insurance Company, purchased subject to the mortgage in suit.

2. The assignment of the Quin mortgage to Mr. Seeley, was as collateral security merely.

3. The transaction, called a sale of the premises described in the Quin mortgage, even though it be not wholly void for non compliance with the statute of frauds, left the premises collateral still. It merely changed the form of the trust, without changing its nature. It was clearly no payment.

4. The purchase by the defendants, The Trust Fire Insurance Company, subject to the mortgage now in suit, was no purchase

Brewer v. Staples.

of the collaterals assigned by Staples as security for that mortgage. In these, the Ins. Co. acquire no interest, even as against Staples, certainly none as against the complainant. They took the land subject to the whole incumbrance of the mortgage. They can avail themselves of no defence to the mortgage, which Staples could not have interposed. And he could not insist that the transaction relative to the Quin mortgage, was any payment of the one now in suit. (Duke of Cumberland v. Coddington, 3 J. C. R. 229.)

5. The Trust Fire Insurance Company ask the court to make for them a new and better bargain, than they have made for themselves. Their rights are to be measured by the bargain they have made.

6. Even if the court could under any circumstances, grant the relief they ask, it cannot be done in the present state of the cause, even if in this cause at all. Their controversy is with Staples, and not with Miss Brewer.

7. The company must pay costs.

G. N. Titus, for the defendants, The Trust Fire Insurance Company.

First Point. The Trust Fire Insurance Company, are entitled in equity to have a credit allowed upon the complainant's bond and mortgage, to the amount of $390, as of the 5th day of November, 1841, or to have the premises described in the Quin mortgage sold at the expense of the defendant Staples, or of Mr. Seeley the purchaser in 1841, and have the proceeds applied towards the payment of the bond of the complainant, and the bond of $1500 given by said Staples to Thurston, before the land now owned by the Trust Fire Insurance Company shall be sold for the payment of the complainant's debt.

1st. Mr. Seeley is bound to complete his purchase, either on his own account, or on account of the complainant and the holder of the Thurston bond and mortgage, or on the account of the defendant Staples. The creditors of Mr. Staples had nothing to do with the secret arrangement of the parties, in relation to the bidding at the sale.

2d. The purchase of Mr. Seeley by the direction of the holders

Brewer v. Staples.

of the two bonds and mortgages above mentioned, was per se a satisfaction of those bonds to the extent of the bid. The defendants, The Trust Fire Insurance Company insist, that such credit should be allowed as against them in this suit.

Second Point. The Trust Fire Insurance Company insist that the complainant is equitably bound to resort to the Quin mortgage, and exhaust it, to obtain payment of her bond, before she shall be permitted to resort to the lands conveyed by Staples to them on account of their demand against him. Equity will compel her resort to the Quin mortgage in the first instance, for satisfaction, if that course is necessary for the satisfaction of the claims of both parties. (Story Eq. Jurisprudence, 647, 648, i 633, and cases cited in notes; Evertson v. Booth, 19 Johns. 486; Hayes v. Ward, 4 J. C. R. 123.)

Third Point. The Trust Fire Insurance Company are at all events entitled to have a decree that the complainant's interest in the Quin mortgage, together with the proceedings for the foreclosure thereof, including the decree of sale, and all the subsequent proceedings thereon, shall be assigned to them or for their benefit, or that they shall be permitted to enforce the execution of that decree, upon the payment of the complainant's bond. (Woolcock v. Hart, 1 Paige R. 185; Wright v. Nutt, 3 Bro. C. C. 270.)

Fourth Point. The complainant is not entitled to the costs of this suit against the land of these defendants. If awarded to her at all, it should be against the defendant Staples, personally.

Fifth Point. These defendants are entitled to their costs in the defence of this suit. The complainant has volunteered to prosecute this suit, at the request and for the benefit of Mr. Staples. If she is charged with costs, she will be entitled to recover them from him.

THE ASSISTANT VICE-CHANCELLOR.-The validity of the claim made by The Trust Fire Insurance Company to have the complainant give to them the benefit of the Quin mortgage, depends upon their right as between themselves and Staples, to compel the application of the Quin mortgage towards the discharge of the complainant's debt. This point necessarily arises