author: King, President. —

text:
    Smedley v. Williams.
    Where one consigns goods and receives an advance thereon of money from the consignee, his control over them has terminated, so that he can impose no new terms upon the consignee under such circumstances, who must he regarded as quasi a purchaser. The consignee who thus makes advances is hound no further to the consignor, than to use all due and proper diligence, skill, and attention in selling the goods at the best rates the market affords, in the manner required hy the established usages of trade.
    It is an established principle in the law of principal and factor, that when the latter renders an account of sales, the former should with all reasonable diligence specify in what particular such account is exceptionable. If the principal retains the account any unreasonable length of time, he is concluded from making objections, but must be considered as acquiescing in the report of the factor’s transactions.
    Where one has consigned goods to his factor and received advances thereon, he cannot withdraw them, without the payment or an offer to pay, not only the amount of advances, but the commissions the factor would have been entitled to receive if a sale had been effected.
    As a general rule, if a principal consign goods to his factor for sale at a given rate of commission, on which he receives advances in anticipation of sales, he cannot at his mere pleasure withdraw his goods from the sale of the goods from the factor, on the repayment of advances and interest.

      March 24.
    This was a bill in equity, filed by Smedley against Matthew and Richard Williams, trading under the name and firm of Williams & Brother. It was stated that the plaintiff was engaged in the business of manufacturing various articles mentioned in the bill, and that the defendants were commission merchants, residing in Philadelphia; that, in the month of February, before filing the bill, the plaintiff made an agreement with the defendants, by which he agreed to place all the goods he should manufacture in their hands to sell for him on his account, they agreeing to advance upon the goods so consigned to them the amount of fifty per cent, at the time of the consignment, and on request to give the plaintiff an account of what sales they made. It was stated in the bill that the agreement was in writing, and in the possession of the defendants. The bill charged that, under said agreement, the plaintiff consigned to the defendants, goods of his manufacture at various times, a description of which was attached to the bill; and received the advances agreed upon; and, on the 18th of October, an account was furnished. That the defendants had, on the filing of the bill, $2000 worth of the goods in their possession, and had had them all summer, but had not sold tliem for him, although he could have easily disposed of them, had they been in his possession; but, in consequence of the goods having been carelessly and negligently kept by the defendants, many were moth-eaten and otherwise deteriorated in value by such neglect. And finding that the defendants did not sell the goods as they had contracted with the plaintiff, and as they professed their inability to make further advances on the goods which he had manufactured, and having over $2000 worth of his goods on hand, independent of those in the hands of the defendant, which he could not, through them, have sold, the defendants refusing to receive the same from him, as they had agreed: he determined to annul the contract with the defendants, and on a settlement of accounts between them and him, and payment by the plaintiff to the defendants of all that on a settlement of accounts might be justly due from him to them, to remove all his goods w'hich were in their hands.
    It was further stated that notice thereof was given to said defendants ; that the plaintiff called upon the defendants, and demanded an account and a delivery of the goods, and professed his willingness and readiness to pay all that he might owe them, and if they were not then ready, that they would inform him when they would comply with his demand. But they gave him no reply, except that they would not account before the 1st of January, and did not accede to his demand, and have not accounted with him nor delivered to him his goods, though they knew they were not sold, and if not sold would be deteriorated in value, although he was willing to pay them what they might reasonably demand. It was alleged by the plaintiff, that he had in all things complied with his contract with the defendants strictly, and had sold his goods to no one else, and when he called upon them for further advances on goods, they alleged they were unable to make them, or to make sale of them, and then advised him to resort to another mode of effecting his sales. Then he left them, and did adopt another mode of selling goods, and that, on sales thus made, the defendants pretended they were entitled to the same commissions as if made by them; and demanded a statement from him of all the goods he had thus sold.
    It was further alleged in the bill, that, after the notice so given, the defendants did offer some of the goods for sale at ruinous prices; and charged that the plaintiff believed it to be the intention of the defendants to make sale of the goods in their possession, at a sacrifice, by auction or otherwise, and thereby to injure him, the plaintiff, unless restrained by an injunction from so disposing of them.
    It was then prayed that the defendants be required to answer numerous interrogatories, and that an account might be taken of the dealings between the parties, and that the defendants be decreed to deliver to the plaintiff all his goods in their possession, in good order and condition, and he held responsible for any damage he might have sustained, and on payment hy the plaintiff upon an account taken of such sum as he might, in the judgment of the Court, he obliged to pay to them for their commission, &c., which the plaintiff professed his willingness to do, they being held responsible in account to him for any damage he might suffer by reason of their refusal to give him his goods upon demand; and that the defendants might be restrained by an injunction from selling any of his goods in their possession, or under their control, until, the judgment of the Court in the premises; and the bill concluded with a prayer for general relief.
    To this bill there was an answer by the defendants, in which it was admitted the plaintiff was a manufacturer, and that an agreement was entered into by them with the plaintiff, as stated in the bill, as to the sales, and the advance of fifty per cent.; but it was alleged there was no agreement as to when an account should be furnished of the sales, although they considered themselves bound to render such account at the usual times, which generally were monthly or quarterly, as might be convenient to the parties; that the agreement was partly in writing, a copy of which was annexed to the answer. It was admitted that the complainant, in the September previous, had attempted to revoke or annul it by the notice mentioned in the bill. That, upon the receipt of said notice, and after the threats of the complainant to act as therein expressed, the defendants did decline to furnish a copy of said agreement demanded. It was admitted by the answer that goods were consigned, of the plaintiff’s manufacture, at various times, as alleged in the bill; and that advances were made by them upon said consignments as agreed upon, and to nearly twenty-five per cent, more than the agreement required upon the value of said goods, as ascertained by the sales; and the account furnished by them attached to the bill was correct. It was further alleged in the answer that the defendants did not know exactly the value of the goods so assigned, and remaining in their possession, but they did not value them at more than sufficient to indemnify them for the balance of their account against the plaintiff. It was averred by the defendants in their answer that they had.made every exertion to have the goods disposed of, in this and other markets, according to their agreement with the complainant, and that sales have been made as fast as could have been expected under the circumstances, and that the complainant never expressed any dissatisfaction on this point until recently; that it was the original agreement between them that the complainant should manufacture such description of goods as should he found suitable, and such as the defendants should request; that they had orders for a particular kind of goods, and requested the complainant to furnish them, hut that the complainant failed to do so, and fill such orders, hut would continue to send them such goods as the market was glutted with, which could not he readily disposed of, and this was a frequent subject of complaint on their part; and in the answer all carelessness and negligence was denied.
    It was denied that they refused to receive goods on consignment, as charged in the hill, or sell the same, or to make advances upon the same in pursuance of their agreement. It was admitted that they received the notice, and that the complainant did call and demand an account immediately, and a redelivery of his goods, and professed a willingness to pay all that he might owe them, and that there was at that time a dispute between the parties as to certain charges and commissions claimed by them. And that they had rendered accounts to the complainant which had been brought up to a recent date, and when called upon for a further account, they informed the complainant it would be difficult and inconvenient to prepare and render such an account as he required, as some of the goods were in Boston, and that the pressure of business at the close of the year was great. It was admitted that in October the plaintiff required them to make advances upon goods which had already been consigned to them, and advanced upon, and that they declined so doing; and at the urgent solicitation of the plaintiff they gave him permission to sell some of his goods, he having informed them that he could dispose of them at retail about the city; but it was upon the express agreement that the plaintiff should render accounts to them of all such sales, and that they should be allowed their regular commissions upon such sales; and that they expressly retained their right to revoke this permission, and that it was not in any way to interfere with the prior written agreement; and that they gave the complainant notice to give them an account of such sales, but that he refused so to do, or to give them their commissions. It was admitted they had made sale of a small amount of those goods, but at usual prices, after the notice, and such as had been approved by the plaintiff on previous accounts. The interrogatories were all then answered.
    The case was referred to a Master to take an account between the parties, and to take proofs; also to report to the Court the state of their accounts in relation to the matters alleged in the hill and answer.
    The Master made a report, and the questions decided, arose on exceptions to the Master’s report.
    The principal exceptions were, that the Master had charged the defendants with the goods consigned at the invoice price, and with all the goods in their hands unaccounted for at the time of rendering the last account, and that the Master had not allowed the defendants commissions upon all the goods sold by the complainant, as agreed upon by the parties.
    The cause was argued by Mr. Tenner for the plaintiff, and Mr. W. B. Brown for the defendants.
   The opinion of the Court was delivered by

King, President. —

The plaintiff rests his claim to recover in the present cause upon three grounds. First, that the defendants had sold the goods consigned at a less price than that expressly limited. Second, that, admitting no express limitation of price is established by the proof, still the goods were sold at less than the market value. And, third, that the defendants had refused to furnish accounts of sales, and deliver to him the remainder of the goods unsold; making themselves by this act chargeable as purchasers of the goods so unsold and detained.

To sustain the first proposition, the plaintiff relies chiefly on the fact, that in all the invoices which accompanied the goods, the prices were carried out, and that upon the aggregate sum of those invoices, the defendants had agreed to advance, and did advance him fifty per cent. Hence it is contended, that, when goods are consigned by a manufacturer to a commission merchant on a stipulation that the latter should make agreed advances on the invoice value of the goods, this wTas equivalent to instructions given by the manufacturer and received by the commission merchant, that the goods should not be sold at less than the invoice prices. But I think it cannot be shown that this construction wTas ever given to such a contract by a Court of justice ; nor has it been established by the known usages of trade; which, when fixed and universal in the place where a contract is made, form a part of it.

The rule seems to be this, that an invoice of merchandise consigned, in which the prices are carried out, is only to be regarded as instructions to the consignee, of the estimated value of the property by the consignor; but does not interdict him from selling at tbe ordinary and usual market rates, although these should he less than the invoice prices. If the consignor, desires to limit the price at -which his goods are to be sold, he should say so in express terms, and if he omits to do so, the consignee has the right to consider the sale of the goods as referred to his sound discretion; and if that is fairly and honestly exercised, the consignor has no reclamation against the consignee, because the goods were forwarded to a market in which the invoice prices could not be obtained. And this rule specially, applies in a case like the present, when advances to the amount of fifty per cent, of the value of the consigned goods have been made; for reason 'and justice indicate that the consignee should have the right to reimburse himself, by selling at the prices which the market would command, unless he binds himself by an express stipulation to keep the goods on hand, and lock up his own advanced capital until there should be a change so favourable in the market as to enable him to make sale at the invoice prices. In the present case, there exists a cogent reason why the prices were carried out in the invoice, without supposing it to have been intended as a limitation. Unless the goods came accompanied with an estimated value, there was no means of ascertaining the advances which were to be made by the agreement, being fifty per cent, of the value of the goods consigned.

There is no doubt but that such a course of dealing may exist between consignor and consignee as would restrain the latter from selling at less than the invoice prices without further advice; but all such cases must depend on their own special circumstances, such as the mutual course of previous dealings between the parties, the usages of the particular business, &c. All we intend to decide in the present case is, That where a manufacturer consigns goods to a commission merchant, who makes advances in anticipation of sales, accompanying the invoice of such a consignment with a statement of the prices, this does not of itself establish such prices as the limit beneath which the consignee should not sell. The consignment of goods on which advances are asked and received involve the right in the consignee to sell the goods in the usual and accustomed manner, and at the regular market rates, in order to the closing of the transaction, and for the reimbursement of his advances. And where the consignor does not desire to subject himself to such liabilities, he should make special arrangements to meet his own views in relation thereto.

In the present ease, there is no sufficient proof of any special contract not to sell at less than the invoice prices.

But it is further alleged that, after the consignment of the goods, instructions were given by the consignor to the defendants, limiting the prices at which the goods should he sold. This the consignor could not legally do after consigning his goods and receiving advances thereon; for his authority over them in this respect terminated. He could impose no new terms on his consignee under such circumstances, who, from the fact of having made such advances, must he regarded as a quasi purchaser; and such advancing consignee is hound no further to the consignor than to use all due and proper diligence, skill, and attention in selling the goods thus consigned, at the best rate the market affords, and in the manner required by the established customs and usages of trade.

In reference to the second proposition contended for by the plaintiff’s counsel, that, admitting the defendants not to have been limited as to price in making sale of the consigned goods, yet they had sacrificed them for prices beneath the market rates, there appear to be two facts which, even on this ground, are decisive of the case against the plaintiff. For it seems that the defendants, on the 18th of October, 1847, rendered their account of sales to the plaintiff, in which he was distinctly apprised of the prices at which the goods were sold; the same which he now complains were sacrificed. This account he held until the 26th of November following, not only without objection, but having in the mean time made new consignments, and received new advances thereon from the defendants.

It is a well settled rule in the law of Principal and Factor, that when the latter renders his accounts of sales to the former, the principal should, with all reasonable diligence, signify in what particulars he considers them exceptionable. But if he retains the accounts any unreasonable length of time, he is concluded from objecting that the goods were sold at insufficient prices. But when, in addition to such unreasonable delay, the principal continues to deal with the factor on the previous footing, giving him new consignments, and receiving new advances, the rule becomes imperative, and he must be held as having absolutely adopted the account. In such cases, however, it must always be understood that the account truly and honestly represents the actings of the factor.

In a case like the present, where the parties lived in the same city, and were in the habits of almost daily intercourse, the detention of the account for upwards of five weeks without objection, coupled with the fact of the plaintiff’s dealing with the defendants upon the old footing, estops him from going into the question whether the sales had or had not been made at an inadequate price.

As to the third ground on which the plaintiff claims to charge the defendants, to wit, that they had on the 26th day of November, 1847, refused to furnish him with a further account and to deliver up the unsold goods, it seems to the Court to be without foundation. It is true that on that day the plaintiff demanded such account, and professed his readiness to satisfy any balance due the defendants; but it is equally true that at that time a part of the goods were on sale in Boston, where they had been shipped with his consent;. this was assigned as a reason for the defendants not being able to render an account of sales subsequent to the 18th of October, but an assurance was given that the account should be furnished the 1st January, 1848. Nor did it appear in proof on what footing the plaintiff was ready to settle with the defendants; whether on the basis of the invoice value of the goods, or upon the basis of the prices for which they had been sold, and of which sales an account had been rendered to him on the 18th of the previous October. If the former, the demand was null, because coupled with a condition to which by law the defendants were not bound to conform.

And even if the demand was made accompanied with an offer to settle on the footing of the actual sales made by the defendants, yet the plaintiff could not withdraw his goods from the defendants without a payment, or' an offer to pay not only their advances, but the commissions the defendants would have been entitled to receive on the sales. For the rule of law is this: If a principal consign goods to a factor for sale at a given rate of commission, on which he receives cash advances, in anticipation of sales, he cannot, at his mere pleasure, withdraw the sale of his goods from the factor, on the repayment of advances and interest.

The factor has an interest in making the sales and earning his commissions, which in general forms the effective consideration of his advances; and it does not rest in the power of the principal to deprive him of this advantage, without showing some substantial reason for so doing. And nothing, probably, would be deemed such a substantial reason, except such a state of facts as would have enabled the plaintiff to have sustained an action of trover or reple-vin against the defendants for the goods. There has been shown no such state of facts in the cause, as places the defendants in the position that the detention of the goods for the security of their unsatisfied balance of account was so far unlawful as authorized the Master in charging them with the goods on hand and unsold, as if they had actually sold them, or become themselves the purchasers, which is the principle on which the account has been stated.

Decree that the report of the Master be set aside, ana plaintiff’s bill dismissed.


source: Caselaw Access Project

license: Public Domain

text:
    Mansell’s Estate.
    It is a rule of equity that the devisee of lands, which the devisor has, before or after making his will, charged with a mortgage, is entitled to have his lands exonerated therefrom out of the testator’s personal estate, unless the devisor indicates an intention that the devisee should take them cum onere.

    The personal estate is the natural fund for the payment of the debts of a testator.
    But lands acquired by a testator subject to a subsisting mortgage or encumbrance created by a former owner, the devisee takes such lands charged with the encumbrance, without any claim for its satisfaction out of the testator’s personal estate, unless the latter has so dealt with the encumbrance as to make it his proper debt.
    Where the widow of an intestate has her one-third of the interest of the money on the valuation of the real estate of her deceased husband decreed to her by the Orphans’ Court, it is in the nature of a rent charge. Where lands are valued by an inquest from the Orphans’ Court, on the estate of an intestate, and the interest of one-third of the valuation money is ordered to be paid to the widow for life, and at her death to the heirs of the deceased, and the heir who takes the lands at the valuation gives his bond and mortgage, to secure the payment of the one-third of the money thus secured to the widow, and dies before the payment of such mortgage, the widow may collect the same out of the personal estate of the deceased, and is not bound to look to the land charged with the mortgage.
    Although the widow has a specific lien on the land for the payment of her annuity, yet if he who takes the land subject to such lien gives his bond and mortgage for the same, he makes it his personal debt, and the bond can be collected out of his personal assets.

      March 24.
    This cause came before the Court on exceptions filed to the report of tbe Master, Mr. Clay. The material exception arose under these circumstances:—
    In the year 1815, Mr. Mansell, the testator, had purchased at Orphans’ Court sale, under proceedings in partition, two houses in Vine street, part of the estate of Jesse Oat, deceased. These houses were conveyed by Oat’s administrators to Mansell for the consideration of $4800, by a deed dated December 26, 1815, which deed recited the proceedings in the Orphans’ Court. The same day Mansell gave his bond and mortgage of the premises to the administrators of Oat, of whom Charlotte Oat the widow of Jesse Oat was one, for securing the payment of $1600 to the administrators “ on the day of the decease of said Charlotte Oat, with interest to be paid half-yearly to the use of the said Charlotte Oat for the term of her natural life.” The mortgaged premises were recited as being the same which the administrators had by a previous conveyance granted to Mansell “ for the consideration thereon, part of which is hereby secured.”

    John Mansell, by his will, after the ordinary direction for the payment of debts, devised, inter alia, to his daughter Sarah Hey-berger, “all those my two messuages or tenements, Nos. 75 and 76, and the lots or pieces of ground thereunto belonging, situate on the south side of Yine street between Second and Third streets in the city of Philadelphia, formerly the estate of Jesse Oat, deceased.” He also devised to his daughter Elizabeth Richards, inter alia, certain property in Third street, subject, with respect to the aforesaid property in Third street, to the yearly ground-rent to which the same is subject. All the rest and residue of his estate other than that specifically devised, the testator gave to his two daughters, to be equally divided between them. Charlotte Oat, the widow of Jesse Oat, is still living. The accountant had paid her the interest on the bond and mortgage up to the date of his account, and took credit thereon for the payment. Before the auditor, the accountant, the executor of Mansell, asked to strike out these credits as improperly taken. On the other hand, Mrs. Heyberger insisted on the correctness of these credits, and required that a competent sum should be set apart out of the balance in the executor’s hands, and invested first to meet the annual payments to Mrs. Oat as they should fall due, and then to pay the principal of the mortgage whenever it should become due by her death.
    The question therefore presented was, whether Mrs. Heyberger took the land devised to her, charged with the mortgage, or whether it was a debt due by the testator, payable out of his personal estate.
    The Master decided in favour of the claim of Mrs. Heyberger; to which decision exceptions were filed, and which were now argued.
    Mr. Cuyler, on behalf of the exceptant,
    inserted that the interest of the widow Oat, however secured, was a charge by the Act of Assembly, in the nature of a rent charge, and that therefore the land passed by the devise charged with it. That this charge was so fixed on the land that, notwithstanding the bond and mortgage, assumpsit could be maintained on it against the devisee. That the right of the widow Oat was art interest in the land, not personal estate. And that, inasmuch as a sheriff’s sale of Mansell’s interest would not divest the widow’s lien on the land, a devise of the same interest could do no more, nor pass a greater estate therein than the testator had himself. He cited Sharp v. Sharp, 12 S. & R. 9; Turner v. Hauser, 1 Watts, 420; Stewart v. Martin, 2 Watts, 200; Thomas v. Simpson, 3 Barr, 70; Deetz v. Beard, 2 Watts, 170; Swarr’s Appeal, 1 Barr, 93; Fisher v. Kean, 1 Watts, 259; Mix v. Ackler, 7 Watts, 316; Mentzer v. Menor, 8 Watts, 196; Pid-dock v. Bye, 3 Rawle, 193.

      JSmlen, in opposition to the exception,
    cited M’Oarty v. Gordon, 4 Whart. 321; Good v. Good, 7 Watts, 195; Unangst v. Kremer, 8 W. & S. 391; Miltenberger v. Schlegel, 7 Barr, 241; Hoover v. Hoover, 5 Barr, 351; Pawley v. Pawley, 7 Watts, 159; Croft v. Webster, 4 Rawle, 242 ; 1 Roper on Leg. 489 ; Phipps v. Phipps, 5 Penna. Law Journal, 176 ; 1 Story Equity, §§570, 571, 572; 1 Brown’s C. C. 452; 2 Wms. on Executors, 1207; 2 Russell & Mylne, 531; 2 John. Chan. Rep. 148; 6 Watts, 167; 7 Barr, 241; 5 Barr, 351; 8 Watts, 198; 7 Watts, 159; 8 W. & S. 312; 4 Rawle, 242.
   The opinion of the Court was delivered by

King, President. —

It is a perfectly settled rule of equity, that the devisee of lands which the devisor has before or after making his will charged with a mortgage, is entitled to have his land exonerated therefrom out of the testator’s personal estate, unless the will indicates an intention that the devisee should take cum onere. Such intention must, however, he manifested by the will in a clear and unambiguous manner. Hence it has been held that a devise of lands subject to the mortgage or encumbrance thereon, does not throw the charge on the estate devised, to the exemption of the testator’s personal estate, which is always the natural fund for the payment of the debts of a testator; the testator being considered as using such terms merely as descriptive of the encumbered condition of the property, and not for the purpose of subjecting his devisee to the burthen of the charge: Serle v. St. Eloy, 2 P. W. 386; Duke of Lancaster v. Mayer, 1 Brown C. C. 454; Astley v. The Earl of Tankerville, 3 Brown C. C. 545; Beckham v. Crutwell, 3 Mylne & Craig, 763; Wythe v. Henniker, 2 Mylne 6 Keene, 635.

In regard, however, to land acquired by a testator subject to a subsisting encumbrance created by a former owner, the devisee of such land takes it charged with the encumbrance, without any claim for its satisfaction out of the testator’s personal estate, unless indeed the latter has so dealt wdth the encumbrance as to make it his proper debt. To produce this result so as to charge his personal estate as the primary fund for the payment of such an encumbrance, the testator must have made himself by contract personally and directly liable at law for the debt to the owner of the encumbrance: Cumberland v. Codrington, 3 John. Chan. Ca. 272.

The principle upon which the first class of cases rests, viz. cases in which the encumbrance has been created by the owner of the land, is obvious. The personal estate of the devisor is liable to the payment of the encumbrance, because the contract is primarily a personal contract, and being primarily a personal contract, the land is only bound in aid of the personal obligation to fulfil' that personal contract. And the primary fund ought always in conscience to exonerate the auxiliary. But in cases of the mere purchase of an equity of redemption, where the land is bought subject to an existing mortgage, and where the purchaser has no connexion, contract, or communication with the mortgagee; and does no act to show an intention to transfer that debt from the estate to himself; • no personal obligation arises between such purchaser and the mortgagee, that can render the former personally responsible to the latter, or charge the personal assets of the former with, the payment of the encumbrance in the event of his death. What circumstances amount to such a personal obligation in a purchaser of land to pay a subsisting mortgage thereon to the owner of the encumbrance, is a question which has frequently occupied the attention of Courts of Equity. The cases of Wood v. Huntingdon, 3 Ves. Jr. 128, Waring v. Ward, 7 Ves. 302, Earl of Oxford v. Lady Rodney, 14 Ib. 417, may be referred to as exhibiting states of circumstances deemed adequate to produce such a result. While the cases of Bagot v. Oughton, 1 P. W. 347, Evelyn v. Evelyn, 2 Ib. 659, Shafto v. Shafto, 2 Ib. 664, Tankerville v. Fawcet, 2 Bro. C. C. 57, Tweddell v. Tredwell, 2 Ib. 101, 152, and Billinghurst v. Walker, 2 Ib. 604, exhibit states of circumstances which, though urgent, were not deemed sufficiently clear to constitute a previous mortgage on land, the personal obligation of a subsequent owner of the land by descent or purchase.

If the case before us is considered as it presents itself on the face of the deed, bond, mortgage, and will, it presents the ordinary one of the purchase of land, in which the purchaser, having paid part of the purchase-money gives his bond, secured by a mortgage on the premises, for the payment of the balance at a time and in a manner therein stipulated. Such a bond is beyond all question his personal obligation, not merely enforceable against the land specially pledged for its payment, but against all his estate. And as the test by which an obligation charged on land is determined to be payable out of the personal estate of the obligor, in the event of his death, is the fact that such obligation is the personal and direct contract of the obligor, it seems to follow that this bond must be so satisfied in favour of the devisee, since the bond and mortgage constituted a personal debt of the testator, and a security for its payment. While the bond remains in force, the mortgagees may proceed upon it against the representatives of the obli-gor, whenever default may be made in the payment of interest or principal.

But a different state of consequences is supposed to follow in the case of the purchaser of land under proceeding for the partition of an intestate’s estate, where a bond and mortgage on the land has been given by the purchaser thereof, to secure the interest of the purpart of the intestate’s widow during her life, and after her decease the payment of the principal of such purpart to his heirs.

It is true, the interest of an intestate’s widow is, under such circumstances, so far considered in the nature of a rent charge (Sharp v. Sharp, 12 S. & R. 9; Turner v. Hauser, 1 Watts, 420; Stewart v. Martin, 2 Watts, 200; Thomas v. Simpson, 3 Barr, 60), that it may be taken in execution, cannot be taxed as personalty (Deitz v. Beard, 2 Watts, 170), and may be enforced by distress. And that no act of the vendee of the land or his creditors can divert it: Swarr’s Appeal, 1 Barr, 93; Fisher v. Kean, 1 Watts, 259; Mix v. Ackler, 7 Watts, 316. But nothing is here proposed that can have the effect of divesting any right or interest which Mrs. Oat may have in the land devised by Mr. Mansell to his daughter, Mrs. Hey-berger. The equity asked by the devisee admits Mrs. Oat’s rights to any and every extent, and therefore seeks to have the devised estate exonerated from her lien by the natural fund from which it is payable as the personal debt of the devisor; admits that the widow of Jesse Oat may, if she sees fit, have recourse to the land, in order to obtain payment of her annual interest, and that the heirs of Oat may in the same way obtain payment of the principal at her decease. Yet they may equally have recourse to the personal estate of the testator, not merely in aid of the land, or in case that security may prove deficient, but in the first instance, and at the option of the creditor: M’Carty v. Gordon, 4 Whart. Rep. 321; Good v. Good, 7 Watts, 195. If, so far, the testator’s bond is to he regarded as an original and primary obligation -which could have been enforced against him personally when living, and of which payment maybe enforced after his death against his general estate, why is this bond not to be regarded as his personal obligation in a case in which the question as to its legal nature and effect arises between the devisee of land, which has been mortgaged by the testator to secure its payment, and his personal representatives ? Conceding that if no such bond had been given by the testator on becoming the purchaser of Oat’s'estate, that the widow Oat’s purpart would have remained a charge on the land, enforceable only against the same, and creating no obligation- binding Mansell personally, yet it was competent for Mansell so tb enlarge and alter this security as to make it his own direct and personal obligation. This he certainly did, on executing the bond to Oat’s administrators, not as a further security, but as an original and primary contract. In doing so then, Mansell manifested an intention to assume a personal obligation much less equivocal than was deemed adequate in the cases of Wood v. Hungerford, Waring v. Ward, and the Earl of Oxford v. Lady Rodney, to make a pre-existing encumbrance on land the proper debt of a subsequent owner, as-well, with respect to the encumbrance, as to a devisee of the land, claiming to have the devised estate exonerated from the debt, by the personal estate of the devisor.

Whether, therefore, this is considered as the simple case of the devise of an estate charged with a previous mortgage created by the devisor, or whether it is considered as one of a direct personal contract to pay a pre-existing encumbrance on land subsequently devised by him; it alike presents the case in which the devisee is entitled to be exonerated from such encumbrance from the testator’s personal estate. The Court accordingly confirm the report and decrees, that the executor of J. Mansell set apart out of the unadministered personal estate in his hands, a sum sufficient to pay and satisfy the bond given by Mansell to the administrators of Jesse Oat; that this sum be invested by him under the order of the Court, and that the interest of such investment be applied to the payment of the annual interest on the said bond to Mrs. Oat.


text:
    Twells v. Costen.
    A till for discovery will not lie against a mere witness.
    The object and end of a bill for discovery, is to obtain testimony by an appeal to the conscience of the defendant, which the plaintiff could not otherwise procure, and which is material to the establishment of a clear legal right, set forth in his complaint. His answers are admissions against himself. But the answers of a mere witness to a bill of discovery cannot be evidence against a third person.
    To the above rule there is an established exception in cases against corporations, where the chief officer may be made party to a discovery, although no decree is sought or could be made against him. This exception is allowed to prevent a failure of justice; for a corporation can only answer under its common seal, and therefore could not be indicted for perjury, if the answer was false.
    Arbitrators, attorneys, and auctioneers have been made parties to bills, although they might also have been witnesses; these are the exceptions to the general rule. These are founded upon the special circumstances, and in general do not appear to be applicable to bills of discovery, but to bills of discovery and relief.

    A Court of Equity has jurisdiction to compel a vendee to complete his contract for the purchase of lands, as well as to compel a vendor to complete his contract for the sale of such lands. Where the vendor has reserved in his terms of sale, the right to resell the land on the default of the purchaser for his account and at his risk, his sole remedy in case of such resale, for the recovery of the difference between the two sales, is at law, and not in equity.
    One cannot come into a Court of Equity to ask discovery against a party otherwise examinable as a witness; even if the witness has acted in such a way as to subject himself to a decree for costs.
    A bill will not be entertained to discover whether one is such a person, or where he is, in order only to make him a party to a suit in a Court of Equity; nor will a Court of Equity entertain a bill for discovery when the plaintiff does not know who are the persons against whom the action is to be brought, not stating such circumstances as may enable the Court to judge of the liabilities of the defendant. To state merely that the plaintiff has a right of action against the defendants, or some of them, is not sufficient. The facts must be stated in such a way that the Court may judge of the ultimate liability of the parties.

      April 30.
    This was a bill in equity, filed by John S. Twells, setting forth, that be was the assignee of Walter Livingston and Charles A. Lyman, trading under the name of Livingston & Lyman, who made to him an assignment for the benefit of their creditors, and among other things, provided in said assignment, he was to sell all the property assigned, and convert it into money, and distribute the proceeds of sale among the creditors of said firm. The bill averred that the complainant accepted the trust; that an inventory and appraisement was made of the estate so assigned to him, and filed in the proper office, and that he gave the security required by law in due form. That among other things which passed by the assignment was a tract of land on which was erected a number of buildings, that were described in the bill; a steam engine and machinery, and a furnace, known as the William Penn Furnace, which property was subject to a mortgage and lease; and being desirous of performing the duties of the trust, he caused the property to be advertised for sale at public auction, at the Philadelphia Exchange, on a day mentioned in the bill. That at the time of sale the conditions were fully stated, that the property was sold subject to the existing liens; and that all the purchase-money was to be paid, or (at the option of the purchaser) $200 to be paid in cash to the assignee, immediately after the property was struck off; in default thereof, the premises again to be immediately put up and struck off to the highest bidder, at the risk and for the account of the first purchaser. The title papers to be executed, and the balance of the purchase-money, if any, to be paid within ten days from the day of sale.
    The complainant further stated in his bill, that, in pursuance of said notice and conditions, the property was exposed to public sale on the day and at the place specified, when divers persons appeared as purchasers, and among others, one Benton Costen, who bid the sum of $10,000, and that being the highest price bid, the premises were knocked down to him for that sum, and whereupon the said Benton paid to the complainant» the sum of $200, and subscribed the terms and conditions of sale with his own name.
    The complainant then averred in his bill, that he was informed and verily believed that the said Benton was not a person of substance, and had no means of performing his contract; that he had not paid the balance of the purchase-money, although often requested, nor any part thereof, but that the same had remained unpaid for more than ten days after the sale; and that the complainant had caused a deed for the premises to be duly executed, to be tendered to the said Benton. That he had again advertised the property to be sold at a public sale at the risk and expense of the former purchaser, and-the same at such second sale was knocked down to one Joseph Stockton for the price and sum of $3000, he being the highest bidder, and that the highest and best price bidden for the same.
    The complainant then charged in his bill that the said Benton Costen did not bid at the first sale, and did not become the purchaser of the premises on his own account, and for his own purposes and behalf; but as the agent or attorney in fact of some other person or persons; and that the said Benton was employed or engaged by such other person or persons to bid for the premises, and to buy the same for him or them, and on his or their account; and that the said sum of ¡§200 was not the money of the said Benton, but was furnished or supplied to him by or on behalf of such other person or persons; and that the said Benton and the said other person or persons did fraudulently unite and combine in a plan or scheme by which the said Benton was to bid at the said first sale, and sign his own name as the purchaser of the premises, and that the name of the principal or principals, and actual purchaser or purchasers of the premises, should be withheld and concealed.
    The complainant then averred and charged in the bill that he was desirous of bringing an action or suit at law or in equity against the person or persons by whom the said Benton was employed or engaged, and who thereby became the purchaser of the premises, to recover the balance of the purchase-money, or damages for the non-performance of said contract, or for relief in respect to the said fraud; for which purpose he had often applied to said Benton to furnish the name and place of residence of said person or persons, and he had hoped said Benton would have complied with his request, but had not.
    The bill then charged that the said Benton was combining and confederating with divers persons unknown to the complainant, who, when discovered, he prayed might be made parties to the bill, and be permitted to charge them as parties defendant. Also that the said Benton pretended that he purchased the premises on his own account, and for his own purposes; and that the sum of $200 paid was his own money, which the complainant averred was not, but the contrary was the fact; that at other times said Benton admitted that he purchased the premises as the agent, and on account of some other person or persons whose names he refused to disclose.
    The bill then prayed, that the said Benton be compelled on oath to answer the said complaint, and disclose who were the persons for whom he purchased; and that when such disclosure was made, such other persons be specially interrogated, and compelled to answer the same. A number of interrogatories were introduced into the bill, directed specially to the matters and things charged. Also a general prayer that he set forth in his answer the names and residence of all the persons by whom he was employed to make said purchase; and also a prayer for general relief.
    To this bill there was a general demurrer.

      The cause was argued by T. I. Wharton, Esq., for the plaintiff, and Charles Lex, Esq., for the respondent.
    Mr. Lex in support of the demurrer,
    contended, 1. That the Court had no jurisdiction.
    2. That this was emphatically a fishing hill against a witness.
    3. That a hill for discovery is not in the nature of an original hill.
    4. A hill cannot he filed against a witness except in the case of a corporation where the officer is required to disclose — sometimes in cases of fraud. He cited 7 Yesey, 287; 1 Yesey, Sr. 425; 1 Yesey & Beam. 545; 1 Yesey, 291; 5 Yesey, 322; Mitf. Eq. PI. 188; 2 Atk. 394; 1 Yernon, 114; 2 Caine’s Cases, 296; 2 Yer. 441; 1 Hopp. 555; 3 Yesey, 343; 1 Eq. C. 76; 12 Law Lib. 35, 77 ; Story Eq. PL 216, § 256 ; 1 Phil. Ch. Rep. 771; 4 Mil. & Cor. 559; 8 Yesey, 398; 2 Atk. 394; 3 Madd. 486; 4 Watts, 465; 2 S. & R. 498; 1 Yates, 79; 1 Watts, 236; 2 Penn. R. 145; 4 W. & Ser. 316; 9 S. & R. 212; 8 Yesey, 398; 2 Caine’s Reps. 296 ; 1 Hopp. N. Y. 555; 3 Yes. Jr. 343; 4 Mylne & Craig, 287 ; 1 Mylne & Craig, 559 ; Story’s Eq. PI. 216, § 259.
    Mr. T. 1. Wharton, for plaintiff,
    contended the Court had jurisdiction. 1. That the bill was not against a mere witness ; he was a party. 2. That it was a case of the first impression. 3. If a mere witness, he comes within the exceptions in the books. 4. This is a hill for relief as well as discovery, and therefore the plaintiff was entitled to proceed with it. 5. The hill charges a combination between the defendant and some one unknown to purchase the property.
    He cited 8 Yesey, 404; 1 Bro. 0. 0. 469; 1 Yesey & Beam. 543; Mitford, 188; 7 Yes. 287, 290; 1 Madd. Chan. 213; Mitford, 153; Story on Agency, 446; 2 Yern. 442; 1 Eng. C. L. 76; 2 Yern. 443; 1 Yern. 212; 2 Atk. 394; 3 P. W. 310; 6 Wharton, 141; 7 Yesey, 289; 1 Yesey & Beam. 545; 1 Yesey, 291; 5 Yesey, 322; 1 Merival, 114; 8 Yesey, 398 ; 2 Atk. 394 ; 4 Watts, 465; 2 S. & R. 498; 1 Yates, 79; 1 Watts, 238; 2 Penna. Rep. 145; 7 Cranch, 69 ; Story’s Equity, 142; 1 Brown C. R. 469; 1 Yesey & Beam. 543; 7 Yesey, 287; Story’s Equity, §§ 192, 186, 204; Harr, on Disc. 9, 17; 1 Madd. Ch. 213; 14 Yesey, 245; 3 Camp. N. P. 317..
   The opinion of the Court was delivered by

King, President. —

The bill in this case sets forth that the plaintiff, John S. Twells, as the assignee in trust for the creditors of the firm of Livingston & Lyman, bankrupts, exposed to public sale certain real estate belonging to the assignees. That by the terms of the sale $200 were to be paid by the purchaser, immediately on the property being struck off to him, and the balance within ten days, on the execution of a deed conveying a good title; and that, in case of non-compliance with the conditions of sale, the property would be exposed to a resale for the account and risk of the purchaser. That at this sale, Costen, the defendant, became the purchaser for the price of $10,000, subject to certain encumbrances to which it was sold as liable to, and paid down the $200 required by the conditions. That, although the plaintiff had caused a deed for the property to be tendered to him, Costen had refused to comply with his contract, and pay the purchase-money. That the property was subsequently exposed to public sale, in consequence of Costen’s default, and was purchased for the price of $3015, by a certain Joseph Stockton. The bill further complains that Costen was not a person of substance, nor had he the means of complying with his said contract; that he did not bid at the said sale on his own account, but as agent of some other person; that the said sum of $200 was not his money, but furnished to him by such other person, with whom he, the said Costen, had fraudulently combined and united in a plan or scheme, by which the said Costen was to bid for the property and give his name as the purchaser; and that the name of the principal and actual purchaser was to be withheld and concealed. That the plaintiff, being desirous to bring a suit for the recovery of the balance of the purchase-money, or damages for the non-performance of the said contract, or for relief in respect to the said fraud, had applied to the said Costen to furnish him the names of his said principals, which he refused, pretending he had purchased the property on his own account. The relief prayed for is, that the defendant Costen should answer the interrogatories, which have for their object the ascertainment of the facts set forth in the stating part of the bill. There is also the usual prayer for general relief. The defendant has demurred to the bill, assigning various causes of demurrer. Those which go to the merits will only be noticed; mere defects in form may be amended, if, on examination, the proceeding can be sustained on principle.

The real question in the cause is simply whether a Court of Equity will entertain a bill of discovery filed by a plaintiff against a defendant to compel the latter to disclose, whether, in a contract entered into between them, be was not tbe mere agent of a principal not named, in order to enable tbe plaintiff to maintain an action against tbe unknown principal for an alleged breach of tbe contract. This tbe defendant denies, on the ground that such an agent is a mere witness, against whom, according to the settled doctrines of equity, a bill of discovery cannot be maintained. On tbe other band, it is insisted by tbe plaintiff, that, if such a bill is not sustained, tbe legal anomaly of a right without a remedy will be presented; because, unless tbe principal against whom the plaintiff’s claim subsists, can be ascertained in the first instance, tbe latter can institute no legal proceeding in which he could avail himself of the testimony of the agent. The case is not without novelty in its precise circumstances; and as the principles involved in it are of much more importance than the mere results of the particular case, they have been fully and carefully considered.

That Costen, the defendant, is a competent witness, whom the plaintiff could examine in an action at law, to establish a claim which he may have against a third person, of whom Costen was the agent, on a contract arising out of and within the limits of his authority as agent, is clear. It is equally clear that a bill for discovery will not lie against a mere witness. Hence, to establish the regularity of this proceeding, the plaintiff must show the existence of a state of things in this ease which takes it oiit of the operation of the general rule. This general rule, having its foundation not only on settled authority, but in practical utility, should be cautiously dealt with, and not frittered away by distinctions which do not necessarily spring from it. The object, end, and office of the bill of discovery is to obtain testimony by an appeal to the conscience of the defendant, which the plaintiff could not otherwise procure, and which is material to the establishment of a clear legal right set forth in his complaint. When addressed to the party sought to be charged by the proceeding, his answers, being admissions against himself on oath, compose the highest species of evidence against him. But the answers of a mere witness to a bill of discovery could not be evidence against a third person; because, as to the latter, the whole proceeding would be res inter alios acta, a proceeding to which he is an entire stranger, and by which, according to the elementary principles of justice, he ought not to be affected. The answer of such a defendant will not even be evidence against a co-defendant in the same bill : Mitford’s Pleadings, 188; because, although the latter is a party to the proceeding, he as such has neither the right nor the opportunity of cross-examining his co-defendant, and should not, therefore, be compromitted by what the latter may respond to the interrogatories of their common adversary. The cases of Plumer v. May, 1 Vesey, Sr. 426, Dinely v. Dinely, 2 Atk. 394, Cookson v. Elliot, 2 Brown C. C. 252, Fenton v. Hughes, 7 Vesey, Jr. 287, Howe v. Best, 5 Madd. 19, are instances of the practical application of this rule.

To this rule there is one established exception, viz. cases against corporations, where chief officers may be made parties to a discovery, although no decree is sought or could be had against them. The reason of this exception, which has been considered as a stretch of the authority of the Court to prevent a failure of justice, seems to have sprung from the fact, that a corporation could only answer under its common seal, and therefore could not be indicted for perjury, however falsely it might answer; and from the idea that, though the ansvrers of the officers could not be read in evidence against the corporation, they might be of use in directing the plaintiff how to draw his interrogatories to obtain a better answer. These are at least the reasons given for the exception' by Lord Talbot, with whom it originated, in Wych v. Meal, 3 Peere Williams, 312. These reasons have not been deemed satisfactory by subsequent Chancellors, for, as is justly observed by Lord Eldon in Fenton v. Hughes, 7 Vesey, Jr., 289, “it is very singular to make a person a defendant, in order to enable you to deal better and with more success with those whom you have the right to put on the record.” This rule, however, is established; but certainly the anomaly it has introduced, does not invite its further extension: See Fenton v. Hughes, supra; Dummer v. Chippenhorn, 14 Ves. Jr., 524; Gibbons v. Waterloo Bridge, 5 Price, 491; Story’s Equity Plead. § 1501; Story’s Equity Plead. § 295; Wright v. Dame, 1 Metcalf, 237.

There is another class of cases, in which arbitrators, attorneys, auctioneers, &c., have been made parties to bills, although they might also have been witnesses, and so far seem to form exceptions to the general rule. These, says Judge Story (Equity Jurisp. § 1500), “ are all founded upon special circumstances, and in general do not seem applicable to mere bills of discovery, but to bills for discovery and relief.” The learned commentator might have even gone further and said, that all the decided eases, in which such bills have been entertained, were cases for relief, and in which this class of defendants were liable at least to a decree for costs, arising from their interest in, or fraudulent intermeddling with, the matter in contestation. There can of consequence be no objection to a decree against a party so circumstanced, arising from the fact that he might have been used as a -witness, instead of being charged as a defendant. It is for the plaintiff to elect, whether he will use him as the one, or charge him as the other, and it does not lie in his mouth to complain, if the plaintiff has made the latter election. A party so circumstanced is not the less a party, because in another form of the controversy he might have been made a witness.

The first case in order of time in which this subject is found distinctly broached is Bennet v. Vade, 2 Atkyns, 324, decided by Lord Hardwicke in June, 1142, which was a bill filed by an heir to set aside a conveyance made by his ancestor of his estate to the defendant, on the ground of fraud and imposition. The attorney who drew the deed was made a party, and was decreed to pay costs. But in this case Wildman, the attorney, had an annuity settled on himself and his wife of ¿040 per annum. In this respect he was a clear party in interest, vendee being chargeable as a party to the fraud, and the bill for relief and not simply for discovery. In Dinely v. Dinely, 2 Atkyns, 394, decided in the following August, Lord Hardwicke dismissed the bill because the defendant was a mere witness. No charge of fraud or interest appears to have been preferred against the defendant: Plumer v. May, 1 Vesey, Sr. 426, decided in 1750, is the next case in order. That was a bill filed to disclose the circumstances of the execution of a will against the subscribing witnesses. Lord Hardwicke here said, You cannot make one a defendant to a bill who is merely a witness, in order to have a discovery of what he can say of the matter.” But he entertained the bill because there was an express charge that the defendant claimed some right or interest under the will. Commenting on this case in Fenton v. Hughes, 7 Vesey, Jr. p. 288, Lord Eldon says, “ There was- a charge that he (the witness) had an interest; and from the last passage of the judgment, you may collect that it was not a mere charge of interest, but of such a species of interest that at the hearing there might have been a decree for an account against him. As to that case I can only say, unless it was upon a Mil for relief I do not know how to understand it.” The subsequent cases are all of the same character: Bowles v. Stewart, Sch. & Lef. 227. They are bills for a relief, and although arbitrators, attorneys, and others have sometimes been made parties, although they had no interest to convey, give up, or receive, such parties had, however, by their conduct in respect to the subject, incurred liabilities, rendering them interested in the issue of the suit. In all the cases in which a person without interest in the question has been made a party, it has been done because there has been a charge against him, not respecting the question, but respectingthe cause: Hare on Dis. 66. Thus the case of Chicot v. Legussire, 1 Ves. Sr. 316, arose on a hill for relief, viz. to set aside an award. The arbitrators were made parties, and the Court, Lord Hardwieke, being satisfied of the improper conduct of the arbitrators, considered them properly made parties, and ordered them to pay costs. Lord Lonsdale v. Littledale, 2 Ves. Jr. 450, was a bill for relief against an award, in which the arbitrator was made a party. His demurrer was overruled, because of the charge of the combination in the bill. “There have been cases,” says Lord Eldon, “ of agents to sell, auctioneers, &c., made defendants without objection. Whether this arose originally from some interest in them, as holding deposits, that would frequently entitle the plaintiffs to relief against them, I do not know, but I cannot deny that such persons have been made defendants where it would he difficult to say any relief was to be prayed against them at the hearing. But these cases are upon bills for relief.”

Mr. Hare, in his excellent Treatise on Discovery, in alluding to this subject observes, that “ the question, whether a party might he examined as a witness, is not decisive of the question of making him a defendant in a Mil for equitable relief, though it may determine whether he be a proper party to a MU for discovery merely. In frequent instances, the sole objection to the examination of a defendant in equity as a witness, is that which arises from his being a party to the bill. The defendant may be brought before the Court in some character necessary to substantiate the suit, that there may be proper parties to it. It will not be sufficient to object to discovery in such a case, that the defendant might be examined as a witness page 64. He is here speaking of a bill for relief; for, although every bill for relief is a bill for discovery, the converse of the proposition is not true. Now, the bill in this case, is a simple bill of discovery to aid in the prosecution of a suit intended to be brought “ to recover the balance of the purchase-money, or damages for the non-performance of the contract, or for relief in respect to the fraud.” In no other point of view could it be entertained by the Court. A Court of Equity has no jurisdiction to enable the recovery of the differences between the amount for which land has been contracted to be sold, and the amount it has actually sold for on the default of the first purchaser, both sales being open, fair, and public. Equity has jurisdiction to compel a vendee to complete his contract for the purchase of lands, as well as it has to compel a vendor to complete his contract for the sale of such lands. Such was the judgment of this Court in the much contested case of Dalzell v. Crawford, ante, p. 37. But where the vendor has reserved in his terms of sale, the right to resell the land on the default of the purchaser for his account and risk, his sole remedy in case of such resale for recovering the differences between the two sales, is at law. In exercising his reserved right of resale, on the default of the purchaser to complete his contract, he has elected his remedy; viz. an action at law for the recovery of the differences. Because in making such resale he has put it out of his power to convey the lands to the purchaser after the Court shall have decreed the contract to he obligatory between them. It is the justice and fitness of mutuality of remedy between the parties, that gives equity jurisdiction, to compel a purchaser to receive a conveyance and pay the purchase-money, as well as to compel a vendor to convey the land and receive the purchase-money. When the vendor, on the default of the purchaser, has resorted to a reserved right to sell the land at the risk of the latter, and to look to him personally for any differences which may have arisen between the two sales, he has closed the doors of the Court against himself, so far as respects any remedy for the specific enforcement of the contract.

Taking, therefore, the case as disclosed by the bill, the plaintiff has no standing in this Court, except the right to invoke our assistant jurisdiction to aid him in obtaining a disclosure of facts necessary to support his legal claim through the instrumentality of a discovery. This he must take on the terms on which it is given to every other suitor. He cannot have a discovery against a mere witness. Hor can he come into the Court to ask a discovery against a party otherwise examinable as a witness, on the ground that the witness has so acted in the cause, as to subject himself to a decree at least for the costs; because equity proceeds in such a case against a witness so circumstanced only on a bill for relief; and decrees a discovery against him, not so much as a witness as a party. In fact, this is the key to the whole doctrine, and explains when and wherefore a party who may be examined as a witness can be joined in a bill, which seeks effective relief against others who are the parties really interested in the question in dispute.

The case remains to be considered under another point of view; viz. whether the Court will entertain such a bill on the ground that its refusal to do so would lead to a failure of justice. Reasons of supposed necessity in a particular case, are not always the safest guides to judicial discretion. In our anxiety to remedy a particular evil, we may be sometimes induced to introduce judicial innovations subversive of the common weal. When it is proposed to extend a well defined and -well understood jurisdiction, on account of some supposed necessity we may subserve, the proposition should be considered also in connexion with the inconveniences we may introduce. As Courts are bound by the principles they announce in all their application, new ones should only be recognised after carefully weighing the entire result of their prospective operations. Now what is asked of us here on the footing of necessity ? No more nor less than this: that we will entertain a bill against any party to a contract, whom the other party to it may suspect to have been an agent at the time of entering into the contract, in order to discover whether his suspicions are well or ill founded, upon his averring an intention to bring an action against such unknown principal, if he exists and is discovered. It is plain that this doctrine, if sound, would not only open a wide field to litigation, but would afford, under the pretext of a legal remedy, a means of inquisitorial espionage into the affairs of others, which might be, if it would not certainly be, abused. The consciousness of these evils has led the enlightened men who have founded our system of Equity Jurisprudence, to exercise the grave power of compulsive discovery with extreme care, and to frown upon all efforts to use the powers of the Court for experimental objects. It is these considerations which have induced the Court uniformly to refuse to entertain a Mil of discovery against a party who might be examined as a witness, and to hold that no one can be made a party to a MU for relief against whom some decree cannot be made, either remedial, to repudiate a pretended claim, or punitory, for some participation in a fraud which the Court is called upon to release against. When the former of these rules was departed from, in the cases of corporations, from a supposed necessity, subsequent reflection has led to dissatisfaction, that, even in this instance, the general rule had been infringed upon. We are now asked to take a further step in advance, and to permit a bill of discovery to be filed against an alleged agent of an unknown principal, in order to discover such principal; and this on a bill on which the Court cannot grant relief for want of jurisdiction over the subject-matter of it; and why, on principle, should this be done ? If one man deals with another on his own credit, as being the principal contractor, he has all that he has contracted for. If lie distrusts the sufficiency of him with whom he deals, if he suspects he is but the agent of a third person, it is easy for him to decline the negotiation, unless he is satisfied in all these particulars. If property is exposed, as in this case, to public sale, and the vendor wishes to guard himself agamst the interference of an irresponsible agent in the biddings, he can guaranty himself by requiring a sufficient deposit on receiving the bid. This was actually done in this case, and it was because of the insufficiency of this deposit, that the plaintiff is now in Court. It is not the function of Courts to supply defects in the terms of contracts, which the want of prudence and forecast in the contractor has omitted, at all events, they ought not to aid him to get out of a difficulty which a superior sagacity would have anticipated, by introducing a rule of law which might work general evil. The necessity in such a case seems a necessity arising from want of sufficient forecast in making a bargain; a necessity which, if admitted to be sufficient to modify the positive rules of law and equity in all cases, would render those rules unworthy of the name.

But let us examine how far this subject has received judicial consideration. The first case we find under this head is Dinely v. Dinely, 2 Atk. 394. That was a bill to establish the will of Sir John Dinely, and sought a discovery against the defendant, his wife, whether she had any son then living by Sir John. She demurred to the bill, because she was a competent witness at law. Lord Hardwicke, in delivering his judgment, said: “You cannot bring a bill here to discover whether there is such a person, or where he is, in order only to malee him a party to a suit in this Court, and therefore the demurrer must be allowed.” The species of information required by the plaintiff in this case, was such as was peculiarly, if not exclusively, in the knowledge of Lady Dinely, and so far the case is parallel with the present. Indeed it seems to rule it, because the necessity of examining Costen, arising from his supposed exclusive knowledge as to who was his principal, if he had any, was equally urgent, as far as appears from the report, as respected Lady Dinely. The same principle was again agitated in the case of The Mayor of London v. Levy, 8 Vesey, Jr. 398. In that case a bill was filed for discovery against Levy, and three other persons, co-partners in trade, seeking to know whether certain goods entered in the custom-house, in the name of one of the partners, were not really the property of the defendant Levy, an alien, or some other, and what person, an alien. The avowed object of the bill was an action intended to be brought by the city of London, to recover certain duties tó which the city was entitled, if the owner of the goods had really been Levy, or any other person than a subject of the British Crown. The hill was demurred to on various grounds. Lord Eldon, in his opinion sustaining the demurrer, among other things said: It has never yet been, nor can it be, laid down, that you can file a hill not venturing to state who are the persons against whom the action is to he brought; not stating such circumstances as may enable the Court, which must be taken to know the law, and therefore the liabilities of the defendants, to judge; but stating circumstances, and averring that you have a right to an action against the defendants, or some of them.”

This case is even more decisive against the plaintiff than Dinely v. Dinely. The bill was for discovery, in order to furnish evidence for an action at law to he brought. Its object was to compel the defendants, or some of them, to disclose who was the party against whom the action was to be brought, whether themselves or either of them, or a stranger within their cognisance. So far almost pari passu with this case. The decision of the Court is on the general merits, the Chancellor distinctly saying he did not put the case on the ground of pains and penalties. So much for positive authority. Negative authority may also be invoked. For that purpose, the text-writers on the law of Agent and Principal, and Vendor and Purchaser, such as Paley, Story, and Sugden ; those treating on equity principles and practice, such as Maddock, Story, Jeremy, Mitford, Hare, and Wigram, have been searched carefully, and in none have we found the idea suggested that a bill of discovery based on the principles of the present could be sustained. If it is true that equity will entertain a bill to compel a defaulting contractor to disclose whether he was or was not the agent of a third person, in making such contract, surely some of these writers would have alluded to the existence of a principle of such practical influence on the law of contract, and of the dealings of Courts of Equity in regard thereto. This silence is strong evidence against the notion that such a doctrine exists in equity. There are two eases, however, to be found in Vernon’s Reports, which I admit in the first instance to have embarrassed me. These are the cases of Heathcote v. Fleet, 2 Vern. 442, and Morse v. Buckworth, 448, also introduced into Equity Cases Abr. 76.

The first is reported in these words: “ Bill to discover who was owner of a wharf and lighter, to enable the plaintiff to bring an action for the damages his goods sustained by the lighters being overset by the negligence of the lighterman. The defendant demurred.” The second, Morse v. Buckworth, is thus stated: M The ship called the Turkey Merchant taking fire by the neglect of the master or ship’s crew, the plaintiff, who was one of the freighters, and had his goods burnt, brought his bill to discover who were part owners of the ship, to enable him to bring his action. The defendant demurred.” Both cases were decided together, and on grounds having no relevancy to the question before us. In neither of the cases it is precisely said who were the defendants. If the defendants in the bill were charged to have been the owners of the vessel, the parties directly liable for the damages suffered by the plaintiffs, then the bills were without exception, because brought not against witnesses, nor experimentally against third persons, but against the real parties charged with the liability, to discover whether they were the latter or not. It may, indeed, be fairly inferred from the argument of the counsel in the causes, that this latter was the fact.

. For there it is said, that “ in hoth cases it was insisted for the defendant, that it was a hard demand in its naturelanguage which could not with propriety have been applied to a mere witness, or an indifferent third person, but which accords perfectly with a case against an alleged owner, of whom discovery was sought, in order to charge him at law. That this is the true character of these cases, may be fairly inferred also from the fact that they never have been cited either in a Court of'Equity, or by any text-writer in connexion with the notion of a jurisdiction in equity, such as that invoked in the present case. They are not all referred to by Judge Story in his “Treatise on Equity Jurisprudence,” and are only noticed in a note to § 579 of his Equity Practice,” in connexion with another subject. In Mr. Hare’s work on Discovery, they are referred to as proving that a discovery may be asked as well to sustain an action pending as one about to be brought, and for no other purpose : p. 51. Neither Jeremy nor Wigram refer to them at all. Rightly understood, however, the cases are sound law, and in harmony with all the other decisions. But even could they be considered as coming into collision with the more recent decisions, still the latter could not be shaken by the authority of a book of the questionable character of Yernon’s Reports, which are but brief notes of cases taken by Mr. Yernon, published after his death, and certainly not remarkable for accuracy.

Upon the whole, considering the bill in this caso as a pure bill for discovery, in aid of suit proposed to be brought at law; and being of opinion that in no other point of consideration does it contain any matter over which equity has any jurisdiction; and being finally of opinion that it does not present a ease in which a Court of Equity ought to entertain jurisdiction for the purposes of discovery,

We sustain the demurrer, and order the bill to be dismissed.