Taylor and Knapp executors. In 1761, the Master of the Rolls decreed, that if the personal estate should be wholly or in part exhausted, in satisfying the debts and funeral expenses, and such of the legacies as were not given to charity, then the legatees of the charitable bequests should stand in the place of specialty creditors, and receive a satisfaction pro tanto, out of the real estate: but without prejudice to the question, whether the legacy of 1001. given to the Warden and Fellows of New College, was within the saving clause of the Statute of Mortmain, which might arise, in case the before mentioned marshalling of assets should not be sufficient to furnish the whole of the legacies given to charities; and he directed an account of the rents and profits of the Hampshire estate, and the balance to be applied to make good the deficiency of the personal estate; and if those funds should prove deficient, the real estate in Hampshire to be sold, and applied to make good the deficiency. The personal estate, and the rents and profits of the Hampshire estate, proving deficient, that estate was sold, and the purchase money paid into the Bank, and laid out in 4295l. 15s. 8d. three per cent. annuities. After twelve years, there was an appeal from the above decree, occasioned by the determination of Foster v. Blagden.(1) And the Lord Chancellor, without hearing the reply, reversed the decree, so far as related to the charitable legacies to Winchester Hospital, and for the relief of widows and children of clergymen, on the authority of Foster y. Blagden, and directed an inquiry, what fund was established at Winchester College, to defray the expense of superannuates at either of the Universities; and, after ordering the costs, declared that the residue of the three per cents. belonged to the heir-at-law..

In Makeham v. Hooper,(m) Joseph Lloyd, being seised of freehold and copyhold estates, and possessed of leasehold and other personal property, devised to trustees all his freehold, leasehold, copyhold, and personal estates to sell, and out of the money to pay, among other legacies, 200l. to the Bath Infirmary, and other charitable legacies to the amount of 1200l.; also 2001. to erect a monument to the memory of J. Curle; and after payment of several general legacies, to pay the surplus of the money arising from the real and personal estates, unto the plaintiff, and D. Evans, and appointed them executors. Evans died in the life of the testator. By codicil, among other legacies, the testator gave to two of the defendants 1001. in trust for another charity, (but without naming any fund out of which it was to be paid), and ordered a monument to be erected to himself. He afterwards made a second codicil, by which he gave some legacies, and died in November 1781, leaving the plaintiff his surviving executor and residuary legatee, and two others of the defendants his heirs at law, and next of kin, who had assigned their claims to the plaintiff. The bill, after the usual prayer in regard to the will and codicils, and the general personal estate, prayed that the charitable legacies might be declared void, and to fall into the residue; and that the real estate might be sold, and the clear residue of the money, as also the testator's personal estate might be

(1) Supra, preceding page.
4 N

FOL. I.

(m) 4 Bro. C. C. 153.

declared to belong, and be paid to the plaintiff as residuary legatee. The cause was heard before Lord Thurlow, C. in February 1784; and by the decree, the will and codicils were declared well proved, and ought to be established and the trusts performed; and it was referred to the Master to take the proper accounts, and to distinguish what arose from chattels personal, and chattels real; and he reserved the consideration, whether the charity legacies were to be paid, and in what manner, and all further directions till after the Master's report: from which report, it appeared, that the money received by the plaintiff and the trustees, amounted to 1988l. 78. 74d., and that they had paid 10377. 158. 5d.: so that there remained a balance of 950l. 128. 24d. That the legacies, besides the charitable ones, amounted to 44901. So that the personal estate fell short of paying the same in 35391. 7s. 94d.; and that the real and leasehold estates sold for above 6000l. The question was, whether the assets should be marshalled? And it was decreed in the negative; Ashurst, Lord Comm. observing, that "he thought they were bound by the recent cases with respect to the question of marshalling that it did not appear what was the reason of the turn in the cases, but as the decisions had taken that course, they would not alter them." But the legacy to the Bath Infirmary, was ordered to be paid, in consequence of the Act of the 19th Geo. 3. c. 23. permitting that charity to take in mortmain.

The preceding authorities clearly settle the rule, that the Court of Chancery will not marshal the assets, so as to throw the debts upon the real estate and leave the personal a clear fund for the charity; but it will be proper in this place to notice a rule of the Court in the administration of the general residue bequeathed to a charity. and consisting partly of mortgage securities and leaseholds which savour of the realty, and partly of assets purely personal. In such case, the bequest of the residue, so far as regards the mortgage securities and leaseholds, fails, as being within the Statute of Mortmain, and lapses for the benefit of the next of kin. As between such next of kin, who are considered in the light of legatees of the mortgage securities and leaseholds, and the charities which have an indisputable right, as legatees of the other personalty not partaking of the nature of real estate, the Court will not allow a creditor or general legatee to resort exclusively to the assets purely personal, to the disappointment of the charity, but will direct a rateable contribution by the charities and next of kin, in proportion to their respective interests, for the satisfaction of the debts and legacies. In the exercise of this branch of equitable jurisdiction, the Court adopts a rule well established by the case on marshalling, namely, that a person, having two funds to resort to for the satisfaction of his demand, shall not, by his option of resorting to either of those funds, determine whether one of two parties, whose equities are equal, shall be paid or not.

The above rule respecting contribution does not appear so distinctly stated, that it was acted upon in the case of Attorney General v. Winchelsea.(n) Nor indeed has the Editor discovered an earlier case, wherein it is explicitly laid down. In the case just men

(n) 3 Bro. C. C. 373.

tioned, and which will be more fully stated in a subsequent part(o) of this work for another point, the Rev. Robert Chapman bequeathed the residue of his personal estate to trustees, upon trust to invest it in the funds, and apply the annual produce for the support of certain charities,

A considerable part of this residue consisted of money secured on mortgage. One of the questions in the cause was, whether the bequest of the residue, so far as it related to the real securities, was not void, as being within the Statute of Mortmain, and it was insisted for the next of kin, that they were entitled to these mortgage securities. The Master of the Rolls, as appears from a note of part of his judgment given in Belt's edition, page 380, first considered the cases as proving that the assets could not be marshalled; and then said that he conceived this case to stand upon the same ground, as if the testator had specifically bequeathed his mortgages to one person, and the other part of his personal estate to another. In such a case, they should contribute to the payment of the debts and legacies rateably, according to the amount of what they each took. The next of kin, in that case, he considered, as if he had been a legatee of the mortgages, and therefore decreed that the payment of the debts and legacies should be made out of the mortgages, and out of the rest of the personal estate rateably according to the amount of each of them respectively.

The rule was stated in Howse v. Chapman,(p) arguendo, by the. counsel for the next of kin, and acted upon by the Court. In that case, Leonard Coward, after enumerating several specific parts of his residuary personal estate, gave the same, after payment of debts, legacies, funeral, and testamentary expenses, to be appropriated to the improvement of the city of Bath. There were parts of the personal estate not enumerated, and undisposed of. After the testators death the bill was filed by the exécutors to establish the will, and ascertain the rights of the parties; the heir at law and next of kin contending, that the bequest of the residue was void for uncertainty of its object, or, if not void on that ground, it was void under the statute 9 Geo. 2. c. 36. as to such parts as were of the nature or consisted of real property. By the decree the will was established, and the trusts directed to be carried into execution, except as to the money secured on real estate; and an account of the personal estate was directed. From the Master's report, it appeared that part of the personal estate, which was held to pass by the bequest for the improvement of the city of Bath, consisted of mortgages to the amount of 49501., certain bonds of the commissioners for the improvement of the city of Bath, Bath corporation and turnpike bonds. The cause coming on for further directions, a point was made on behalf of the next of kin, that the debts, legacies, and funeral expenses, and the costs of all parties were to be paid in equal shares, out of the personalty bequeathed for the improvement of the city of Bath and the personal estate undisposed of. On behalf of the next of kin, Attorney General v. Winchelsea was cited, and it was urged, that "where a residue is left for charitable purposes including mortgages and other interests that cannot go to the charity, the debts and *(f) 4 Ves. 542.

(0) Vol. 2. chap. 19. sect. 7.

legacies shall be paid out of the two parts of the estate pro rata:" and the Lord Chancellor said, the bequest of the city of Bath of particulars enumerated was specific, that the articles not enumerated went to the next of kin, and that the general residue was to be applied, in the first place, in payment of debts and other charges. And he further observed, that the case was directly within Attorney General v. Winchelsea, with regard to the mortgages and other things that were taken out of the bequest; because the law takes them out of it. The decree declared, that the bequest for the improvement of the city of Bath was a charitable bequest, and that the mortgages and bonds of the commissioners for the improvement of the city of Bath and the turnpike bonds did not pass, but were undisposed of by the will, and belonged to the next of kin; and it was directed that the Master should distinguish such of the particulars of the personal estate specifically bequeathed for the improvement of the city of Bath, as were well given, from such particulars as did not pass thereby, but belonged to the next of kin; and it was further ordered, that the same be applied pro rata for the payment of so much of the testator's debts, legacies, and funeral expenses, and of so much of the costs as the general residue of the testator's personal estate undisposed of by his will would not extend to pay, and that such particulars of the personalty, specifically bequeathed for the improvement of the city of Bath, as did not pass, be divided, after payments before directed, among the testator's next of kin, according to the Statute of Distribution; and that such particulars, specifically bequeathed for the improvement of the city of Bath, as were well given, after the payments thereout directed, be paid to the defendant the clerk to the commissioners for the improvement of the city of Bath.

Again, in Paice v. The Archbishop of Canterbury,(q) Mary Wilks gave the remainder of her different bequests to the Archbishops of Canterbury and York for the time being, in trust for charitable purposes, and bequeathed her house in Grosvenor Square, and all her property in London, to be sold; and after payment of a mortgage, the monies arising from the sale to be applied to the general purposes of her will. The first question was, if the general residue passed to the Archbishops of Canterbury and York for charitable purposes; and secondly, if so, whether the money produced by the sale of the testatrix's leasehold house in Grosvenor Square, and freehold estate in London, were liable to any part of the debts, legacies, and costs. The Lord Chancellor decided, that as to the real estate devised to the charity and personal estate connected with land, as leaseholds and mortgages, the disposition was void under the statute ;(r) and, at the conclusion of his judgment, observed, the same arrangement must take place by apportionment of the charges between the funds, as in the case of Attorney General v. Winchelsea.

Lastly, in the case of Curtis v. Hutton,(s) the above rule received a further confirmation. In that case, George Hutton directed his real estates to be sold, and declared that the produce of such sale, and the rents in the mean time, should constitute part of his per(g) 14 Ves. 372.

(r) 9 Geo. 2. c. 36,

(s) 14 Ves. 537.

sonal estate, and be subject to the trusts thereof: and he bequeathed his personal estate, and the monies to be produced from his real estate, to trustees, to pay debts and legacies. He then bequeathed 2001. to the trustees of a charity school in Butt Lane, Deptford, for the purpose of purchasing lands contiguous: and he declared the trusts of the residue of his personal estate to be for such purposes as he should by deed or codicil appoint. By codicil, the testator directed the trustees to lay out the trust monies in the purchase of freehold estate in Great Britain, or in the public funds, or in other proper security, the income of the trust fund to be applied in an establishment for students in the King's College of Old Aberdeen. The bill was filed by the trustees against the widow and only daughter of the testator, to have the will established, and trusts carried into execution. The answer insisted that the bequests of the residue to the college at Old Aberdeen of the 200l. to the charity were void, and submitted, whether, if the former were good as to the personal estate, it ought not to be postponed until after payment of debts and legacies. It was contended on their behalf, that, supposing the disposition void, the debts, legacies, and annuities must be thrown upon the fund which was effectually given to the charity; and also upon that fund, the disposition of which failed; in the proportion the respective funds bore to each other, according to the rule established in the Attorney General v. Winchelsea. The Master of the Rolls said, the rule, as contended for, was settled by many cases: And he determined also, that nothing which was the produce of the testator's real estate passed under the dispositions to the charities.

The reader will observe the distinction between the rule of contribution established by the class of cases just discussed; and the case of marshalling. By marshalling, the Court would indirectly allow the charge upon the real estate for the benefit of a charity, contrary to the Statute of Mortmain; and the practical result would, in most cases, be that of excluding the next of kin, wholly, or in part, from that portion of the residue which fails by the statute, and to which by law they have an equal right with legatees, to whom legacies are effectually given. On the other hand, the Court, in adopting the rule of contribution before stated, considers the equities of the next of kin and the charities equal, and therefore directs a rateable contribution from each toward the payment of debts and legacies.

SECT. VII. The mode in which equitable assets are distributed among legatees.

When assets are marshalled in favour of a legatee, the personalty having been wholly or in part applied in payment of a specialty debt, we have seen that the legatee may resort to the real estate to the amount of the personalty applied in satisfaction of the specialty debt; and in such case, if there are several legatees, they will be paid pari passu; and if the fund be insufficient to satisfy the whole of their respective legacies, each legatee must abate in proportion to the amount of his legacy. But suppose the case is not one of marshalling, there being but one fund for the payment of all claim