Sir William Grant, M. R. made a similar decree in Hancox v. Abbey, (v) under the following circumstances: In that case, Mr. Hancox, having a wife and two daughters, devised his real estates to trustees, to sell a part with all convenient dispatch after his death, and to discharge out of the money a mortgage debt affecting one of them, and to raise 2000l. for his daughters, payable at twenty-one or marriage; with a direction to his trustees, that so soon as the legacy was raised, it should be invested in stock, and the dividends applied for the maintenance of his daughAnd after the sale, and the application of the purchase money, for the purposes aforesaid, he devised the residue of the said estates to his wife for life, with remainder to his daughters as tenants in common in fee. The testator gave some legacies, and bequeathed his residuary personal estate, after payment of all his debts, legacies, and funeral expenses, to his wife absolutely. Sir W. Grant decided, that the personal fund was exonerated from its original liability to discharge the mortgage debt, and the legacy of 2000l. With respect to the legacy, the reasons for his Honour's decree appear to have been these: 1st, That the 2000l. was not bequeathed as a gross sum, but as so much of the produce of the real estates; a devise, which entitled the daughters to the money in no other shape than as part of the real proceeds ;(u) and 2dly, that the testator showed his intention, that the money should be raised solely out of the land; from the several directions which he gave as to the payment of the interest and the capital, none of which were applicable to a sum of 2000l. generally, but all to the sum of 2000l. with the circumstances previously stated, viz. a sum arising in consequence of the sale of real estate, and produced by that sale. So in Gittins v. Steele, (x) where Lord Eldon reversed the decree of Sir John Leach, V. C.; the case was, that Mr. Evans, after directing his executors to pay his debts, funeral expenses, and the costs of proving his will, bequeathed 7000l. equally among his cousins, and charged his real property with the payment of that sum. He then gave to persons, whom he appointed executors, two specific sums of 8000l. and 2000l. three per cent. stock, then standing in his name, upon certain trusts, and after giving several legacies out of his residuary estate, he devised to the same persons, as trustees, all his real property to sell, and out of the proceeds and intermediate rents to pay his debts, funeral expenses, the 7000l. and the expenses of the sale. He then bequeathed all his money, securities for money, stock in trade, and the residue of his personal estate (not before disposed of) to his executors and trustees in trust, to sell his stock in trade, &c. and out of the produce, and his other money and securities, to pay the said legacies of 8000l. and 2000l. stock, and the several other legacies before given, except that of 70001. which was to be considered as a charge upon, and paid out of the proceeds from the sale of the real estate. The testator then directed the residue of the money produced from the sale of his real property, stock in trade, and personal estate, and the residue of his other personalty, to be invested on securities for a limited period; and after providing, out of the interest, for the payment of certain weekly sums, he gave (v) 11 Ves. 179. (u) See Walker v. Pink, cited 1 Cox, 5. (x) 1 Swanst, 24. the surplus interest, and also the capital after the period before alluded to, for the benefit of the persons, who should be entitled to the said three legacies of 7000l., 8000l., and 2000l. Lord Eldon determined, that the real estate was the primary and sole fund for discharging the legacy of 7000l. and that the produce of it being insufficient to pay the whole sum, the legatee was not entitled to resort to the general personal assets to supply the deficiency. The last is a stronger case in favour of exempting the personal estate from the particular legacy by negative words, than Phipps v. Annesley, before stated.(u) In addition to the whole frame of the will, manifesting the testator's meaning that the bequest should only take effect out of the proceeds from a sale of his real estates, he expressly exempts his personal property from the payment, declaring that the legacy was to be considered as a charge upon and to be paid out of those real proceeds. After such an explicit declaration, it would seem, that had other passages in the will raised a doubt as to the intention, it ought not to have been regarded; since, according to Lord Hardwicke in Inchiquin v. French,(x) where there are express words, they cannot be over-ruled by implication. We shall proceed to consider SECONDLY.-When the personal estate will be exempted from debts secured by mortgages upon the real property. It is a general rule, that the heir or devisee of an estate liable to a mortgage debt contracted by the testator, is entitled to have the land exonerated by the general personal assets ;(y) because the money, being a debt due from the testator, is like his other debts, primarily payable out of the personal estate; and it is immaterial, whether he convenanted to pay the money or not, it being in either case equally his debt.(z) But these two circumstances must concur to entitle the real property to exoneration, viz. the debt must be of the testator's contracting, except under special circumstances; and it must not appear that he intended to pass the estate cum onere. The principal authorities, where the personal estate was adjudged to be primarily liable to discharge the real from incumbrances with which it was charged, will be found in note. (a) And although the testator devise his real estates charged with, or to be sold to pay, all his debts, yet, as that circumstance alone will not (as we have seen) exempt the personal assets from the obligation to discharge those demands, the personal estate will, in the first instance, be applicable to pay a debt by mortgage, as one of them.(b) So also, if the real estate be devised to a person, expressly subject to mortgages affecting it; still the personalty will not be exempted from payment of them, because the testator's intention, by those expressions, to cast the burthen of those debts upon the devisee, so as to deprive him of his equity to resort to the personal estate for ex(x) Ante, p. 465. (z) 1 Ves. sen. 99. Howard, Pre. Ch. 61. Howel v. Price, 1 P. Will. 291. Pre. Ch. Cope v. Cope, 2 Salk. 449. Bateman v. Bateman, 1 Atk. 421. Lanoy v. Athol, 2 Atk. 444. Lord Portsmouth v. Lady Suffolk, King v. King, 3 P. Will. 358. (u) Ante, p. 486. 2 Atk. 57. (y) 11 Ves. 186. (a) Meynell v. 423. 477. S. C. ed. by Sanders. 1 Ves. sen. 31. (b) 11 Ves. 186. and see Hale v. Cox, infra, as to the mortgage of the houses in Piper Row. Also Lawson v. Hudson, 1 Bro. C. C. 58. 3 Bro. Parl. Ca. 424. oneration, is not clear and unequivocal. He might mean nothing more than to pass the estate, as the law would have done, in the absence of the explanatory expressions, i. e. subject to the mortgages; in which case, the right of the devisee against the personal estate would remain unaffected.(c) But where a testator's intention is plainly shown to make the devised estate the primary fund for payment of incumbrances affecting it, the devisee must take it cum onere; and the personal estate will be discharged. This may happen, when a testator expressly devises a portion of the proceeds from a sale of his real estate to be applied in discharge of a particular incumbrance charged upon a part of it; for he could have no other motive in giving such a direction, than that the money to be raised by means of the real estate should be first applied in payment of the particular debt.(d) The personal estate would be also exonerated, when the real is not given to the devisee till after a sale, and the proceeds have been applied in discharging incumbrances upon the lands or some of them; because, what is devised, is not the whole, but so much of the. real property or produce as remained, after those purposes have been answered.(e) To give him, therefore, the whole of the estate, by discharging the mortgages out of the personalty, would be contrary to the terms of the will. Thus in Hale v. Cox,(f) the testator had mortgaged one estate called Milstones to a Mr. Robins, for 300l., and some houses in Piper Row, Wolverhampton, to another person. Under these circumstances, the testator directed the latter mortgage, and all his debts and funeral expenses to be paid out of his personal estate, bequeathing to trustees the residue of that fund for the benefit of two persons, who died before him. All his other real estates, (including Milstones in mortgage to Robins) he devised to the same trustees, in trust to sell such of them as should be in mortgage at his death, and after payment of principal and interest, he ordered the surplus to be invested upon securities, for the benefit of his daughter for life, with remainder to her children. The trustees were authorized, in their discretion, to continue the money on the mortgage, or borrow money on a transfer of the security. Although Lord Thurlow decided the case against the exemption of the personal estate, in consequence of the death of the residuary legatees during the testator's life, yet he was of opinion, that if such accident had not happened, the estate in mortgage to Robins must have been the primary fund for discharging that debt, there being no beneficial devise of its produce until after that event. But as to the other mortgage, he considered there was not sufficient evidence of intention, to exempt the personal fund from its natural obligation to exonerate the pledged estate. The above opinion of Lord Thurlow in regard to the primary liability of the real estate to discharge the mortgage debt due to Robins, was afterwards. confirmed by Sir W. Grant, M. R. in the (c) So stated in argument, and admitted by Sir W. Grant, 11 Ves. 181. 188. and see 8 Ves. 306. (d) 11 Ves. 186. and see Watson v. Brickwood, ante, p. 472. in exception, under the particular terms and construction of the will, 9 Ves. 455. (f) 3 Bro, C. C. 322. (e) 11 Ves. 187. case of Hancox v. Abbey, before in part stated,(g) who decreed that the devise to trustees of the real estates, in trust, out of the proceeds from a sale of part of them, to pay a mortgage debt secured upon the testator's lands at Hanwell, with a disposition of the rents, &c. of the unsold estates after the sale, and the application of the pur-. chase money for the purposes therein mentioned (one of which was to discharge the debt by mortgage,) constituted the real estate the original fund for the payment of that debt.(h) When indeed a testator has in words exempted his personal estate from particular debts, they cannot be controlled by implication.(i) Suppose then a testator to devise part of his real property to trustees to sell, and with the proceeds to discharge a mortgage upon another estate, and particular debts mentioned in a schedule to his will; and then to settle the remainder of his lands, including those subject to the mortgage, upon his wife and family; at the same time bequeathing to his wife, all his personal estate fully exonerated from his debts therein, and in the schedule enumerated, and from his debts and funeral expenses. If in the case supposed, the trust estate be insufficient to satisfy those demands, the settled estates must be applied in exoneration of the personalty; because, whatever may be the presumption of a contrary intention, it cannot stand in competition, with the express exemption of the personal property.(k) The heir or devisee of a mortgaged estate will also be precluded from resorting to the persoal assets of the ancestor or testator for exoneration, when the debt is not contracted by such ancestor or -testator; but the estate will come into his hands with the charge upon it. This is exemplified in the recent case of Scott v. Beecher .and wife.(1) In that case John Tyson, having surrendered his copyhold estate to Richard Mills and his heirs, by way of mortgage, for securing 1000l. by his will devised all his estate, and effects to his wife Elizabeth Tyson, and in particular his copyhold estate, and appointed her executrix. After the testator's death in 1814, Elizabeth Tyson proved the will, was admitted to the copyhold subject to the mortgage, and in 1816 died without issue, and intestate, leaving her brother, the plaintiff, her heir at law, according to the custom. Letters of administration were granted to the plaintiff, and to the wife of the defendant. Upon the question between the heir at law and administrator of Elizabeth Tyson, whether the former should take the estate subject to the mortgage, or have it discharged out of the personal estate of Elizabeth Tyson, the Vice Chancellor remarked, that Elizabeth Tyson was devisee of the copyhold estate, and was also residuary legatee and executrix of the mortgagor. If she had thought fit, she might have paid off the mortgage out of the personal estate of her husband; for it was admitted that she possessed assets sufficient to pay all the debts including the mortgage, and it might therefore be said that she elected to continue the mortgage as a charge on her real estate. But his Honour apprehended that that was not a case, in which a personal representative was bound to make out any such fact of election. By the gift to her as residuary legatee, the personal estate of James Tyson became her (g) Ante, p. 488. (h) See 11 Ves, 179. 186. (k) See the case of Morrow v. Bush, 1 Cox, 185. (i) See ante, p. 465. (1) 5 Madd. 96. personal estate; but the mortgage debt of James Tyson was not her debt, and her heir, therefore, had no equity to pay off the mortgage out of her personal estate. The bill was accordingly dismissed with costs. The same rule holds although there be a general charge of debts: upon all the testator's real property, because such an incumbrance is not considered to be his debt, payable primarily out of his personal estate. And if it be not his debt originally, it will not, in general, acquire that character by his covenant to pay the money, so as to make his personal estate the primary fund for satisfaction of the demand; for such a covenant is merely auxiliary, an indispensible accident to subsequent transactions, consequent upon the creation of the original debt. Suppose then a testator to have acquired an estate, either as heir, devisee, or purchaser, subject to a mortgage; and upon a transfer of the security to have covenanted to pay the debt; in neither instance would his personal assets be answerable, in the first place, to satisfy the demand, they could only be resorted to in aid of the charged estate. This may be considered as the general rule, established by the cases referred to in note; (m) a rule, which will not be departed from, although the testator may have pledged his own estate as an ulterior security for the same debt;(n) since the debt remains unaltered, and the security is merely collateral to it. And upon the same principle, if the testator's heir or devisee make an additional mortgage of the estate to pay the debts of the testator, and the money is so applied, or if he enter into personal obligations to individuals having claims or liens upon the land, such mortgage or obligations will not, as between the real and personal, representatives of the heir or devisee, entitle the former to call for exoneration out of the personal estate: for that fund received no accession or benefit from those transactions, which, having been entered into in respect of the real estate, it seems but reasonable, that such estate should be the primary fund liable to answer them. Accordingly, if an estate be devised to trustees to sell to pay debts and legacies, and, subject thereto, in trust for B., should B. give a bond, or other security, to a legatee or creditor for payment of his demand upon the lands and die; those lands will be the primary fund for discharging the obligation.(o) The principle, which governs cases of this description is well expressed by Sir W. Grant, in his comments upon Billinghurst v. Walker.(p) There a term of ninety-nine years was created to se (m) 1st. Where the covenant was entered into upon a transfer of the security, Bagot v. Oughton, 1 P. Will. 347. Evelyn v. Evelyn, 2 P. Will. 663. Shafto v. Shafto, 2 P. Will. 664. ed. by Cox, in notes. 1 Cox, 207. S. C. 3 Ves. 131. Perkyns v. Bayntun, 2 P. Will. 664. ed. by Cox, in notes. 2nd. Where the testator purchased the equity of redemption, and covenanted to pay the money; Forrester v. Leigh, Ambl. 171. 173. 2 P. Will. 664. ed. by Cox, in notes. Ancaster v. Mayer, 1 Bro. C. C. 454. 464. Tweddell v. Tweddell, 2 Bro. C. C. 101. 152. Commented upon by Sir W. Grant, 14 Ves. 424. (n) 1 Bro. C. C. 464. (o) Basset v. Percival, 2 P. Will. 665. ed. by Cox, in notes. Earl of Tankerville v. Fawcet, 1 Cox, 237. 2 Bro. C. C. 57. S. C. Hamilton v. Worley, 2 Ves, jun. 62. Mattheson v Hardwicke, 2 P. Will. 665. in notes. 5th ed. by Cox. (A) 2 Bro. C. C. 604. |