1838.-Haydon v. Bell.

signed by the said Elizabeth Haydon to Ann Bell, as a further security; I hereby agree, at any time within the said three years, on payment of the said note of hand for the sum of 12007. with the interest thereon, to deliver to Henry Bell on demand the lease of the said premises before described, with a proper assignment of the same, according to the terms and conditions of an agreement bearing date August 9th, 1834, and made between myself of the one part and Ann Bell of the other part and I also further agree to allow Ann Bell to carry on the business of the said house in any name until the next transfer day of transferring licenses for the borough of Marylebone, and fully authorize her to act as my agent for that purpose during the period before stated."

On the same day Ann Bell assigned her interest in the contract to Henry Bell. The certificate of the lessor's surveyor having been obtained, the lessor, on the 27th of November, 1834, by virtue of a power reserved to him, granted a lease of the property to the plaintiff.

Henry Bell, in February, 1835, borrowed of Messrs. Young & Bainbridge a sum of 5001. on which occasion Ann Bell and Henry Bell entered into an agreement with Messrs. Young & Bainbridge, by which Henry Bell agreed to pay the 12007. still due to the plaintiff, and that after payment of the 12007. the lease should be assigned to Messrs. Young & Bainbridge for securing the 5007; and Ann Bell and Henry Bell agreed to do all necessary acts for procuring the assignment of the lease to Messrs. Young & Bainbridge.

The defendants having refused to complete their purchase, this [*340] bill was filed against Ann Bell, Henry *Bell and Messrs. Young & Bainbridge, praying a specific performance of the contract, "so far as the same remained unperformed, by payment of the 12007. and interest,” and in default, that the defendants might be foreclosed.

The defendants, by their answer, insisted that there had been misrepresen tations on the part of the plaintiff; that the plaintiff was bound to show the lessor's title, or at least to show that the power under which the lease had been granted, had been duly executed.

Ann Bell also filed a cross bill, to set aside the contract on the ground of fraud; which being unsupported by evidence, was dismissed with costs.

It was proved that the defendants had been informed that the new lease was, with one exception, to contain clauses and covenants similar to those in the old lease, and that Henry Bell was aware of the terms of the old lease having had it in his possession for some time previous to entering into the agreement.

Mr. Pemberton and Mr. Bethell, contended that the plaintiff was at once entitled to a decre for a specific performance of the contract, and for payment of the residue of the purchase money, with interest and the costs of suit, and that in default of payment the property should be ordered to be sold.

Mr. Kindersley and Mr. Rogers, for the defendant Ann Bell, insisted on the above points raised by her answer, and contended that the defendant, was, at

1838.-Haydon v. Bell.

least, entitled to the usual reference to the Master, to inquire if a good title could be shown.

*Mr. Richards, for Henry Bell, contended that he had improperly [*341] been made a party to the suit; he had signed the agreement, not on

his own behalf, but as agent of Ann Bell; he had agreed, it was true, to give his promissory note, but that being done, there was no further claim or demand against him, except upon his legal liability under that note. That the bill had been filed before the note became due, and therefore the plaintiff was at that time entitled to no relief; that Henry Bell was answerable at law alone and not in equity, for the relief asked against him was in respect of a mere legal claim on the promissory note, and which, consequently, ought not to be the subject of a suit in equity.

Mr. Chandless, for Messrs. Young & Bainbridge.

Mr. Pemberton in reply. The defendants were perfectly aware of the nature of the plaintiff's interest and of the title; they have dealt with the property in such a manner as to preclude their calling for the production of the lessor's title; Henry Bell has obtained an assignment of the property, and has made default in payment of the interest on the promissory note: he was surety for the payment of the 1200l., and was therefore a necessary party to the suit.

THE MASTER OF THE ROLLS-This is a bill filed for the specific performance of an agreement; it is filed against Ann Bell, Henry Bell and Messrs. Young & Bainbridge, and it prays (his Lordship read the prayer of the bill.)

The contract was dated in August, 1834, and was for a lease which was to be granted, but which had not been granted at the time the contract was entered into; the price was to be 20501., of which 850l. was to be *paid down, and the remaining 1200l. was to be afterwards paid, and [*342] to be secured by the defendant Henry Bell. It does not appear that

he executed the contract as a party, but as agent for Ann Bell, his sister; the 12007. was to be paid in three years from the date, but before the contract was to be finally carried into execution, before the lease was to be granted, there were certain repairs to be done to the premises.

On the 2d of September, 1834, Henry Bell, in pursuance of the agreement, gave his promissory note for the sum of 12007.; and on the same day the interest which had been obtained by Ann Bell was assigned to Henry Bell. It was part of the agreement, that after the lease was obtained, it was to be a security for 12001. The lease was obtained on the 27th of November; and in February, 1835, Ann Bell and Henry Bell having occasion to borrow a sum of money, obtained it from Messrs. Young & Bainbridge, on an agreement, that subject to the rights of plaintiff, the lease should be assigned to them. We find that Ann Bell and Henry Bell were perfectly acquainted with the nature of the property, and the difference between the new lease and the old lease, and that they dealt with it for the purposes of assignment, and of

1838.-Haydon v. Bell.

making a security. This transaction took place between Ann Bell, Henry Bell and Messrs. Young & Bainbridge after the lease had been granted. Looking on these circumstances, and after such dealing with the property as appears in this case, it is clear that no objection can now be taken by them in point of title; there must therefore be a decree against Ann Bell, and her cross bill must be dismissed with costs.

As to Henry Bell, I am surprised at the way in which he has put [*343] his defence: he was a person *answerable as the agent of Ann Bell, the party entitled under this contract. It was part of the terms of the agreement that the 12007. should be secured by him for three years, with interest at 5 per cent.; afterwards, according to the agreement, he gave his note, and subsequently obtained an assignment of his sister's interest in the lease, and he dealt with it and borrowed money for himself. This did not make him a party to the original contract, but the rights of the plaintiff are to be worked out against the property, and are so intimately connected with the interest of Henry Bell, that the suit could not go on, unless he had been made a party, for he is both interested in the property and answerable for the unpaid purchase money.[1] That he must pay this, is quite clear, and his interest must be dealt with for the purpose of being sold; there must therefore be a decree for specific performance, by payment of the 12007. and costs of suit by Ann Bell and Henry Bell; and in default, the lease must be sold, and the plaintiff's principal, interest, and costs paid out of the produce.

[1] As to the general rule that all persons interested in the subject must be made parties, see Fawcett v Whitehouse, 1 Russ. & M. 132. Bayley v. Best, id. 659. Wendell v. Van Rensselaer, 1 Johns. Ch. Rep. 349. Hoxie v. Carr, 1 Sumn. 173. Wardell v. Claxton, 1 Yo. & Coll. C. C. 265. Hawley v. Cramer, 4 Cow. 728. Hawkins v. Hawkins, 1 Hare, 546. Mangles v. Grand Collier Dock Company, 10 Sim. 541. A bill brought by a purchaser for the specific performance of an agreement to sell lot A. as described in the particulars of sale, was resisted by the vendors on the ground, (stated in their answer,) that by an arrangement to which the plaintiff was a party, part of lot A. as described, was deducted from that lot and added to lot B. It was held that the plaintiff on amending his bill, and putting in issue this averment, was bound to make the purchasers of lot B. defendants to the suit. Mason v. Franklin, 1 Yo. & Coll. C. C. 239. The heir at law of the vendor of real estate is a necessary party to a suit by the administrator of the vendor against the purchaser for specific performance of the contract. Wigram, V. C. says; "The purchaser, when he is sued for the specific performance of his contract, is entitled to have the question of the validity of that contract decided (if it is to be decided) in the presence of the vendor, or, if the vendor should be dead, in the presence of all the parties who represent him: he is entitled after the death of the vendor, to the same benefit from the suit, by obtaining a decree conclusive on the question, as he would have had if the vendor were living. If the vendor had devised the estate contracted to be sold, it is plain that the suit could not have been brought without making the devisee a party. If the estate, instead of being devised, has been allowed to descend, it is equally necessary that the heir should be a party.” Roberts v. Marchant, 1 Hare, 547. In general, however, to a bill for the performance of a contract of sale, in the usual form, the parties to the contract are the only proper parties. Robertson v. The Great Western Railway Co. 10 Sim. 314. Ibid. 315, n. 1. And see Glyn v. Soares, 3 Myl. & K. 470. Hoxie v. Carr, 1 Sumn. 173.

A mortgagee, who was a party to the suit, consented to a sale of the mortgaged property: Held that he must produce and leave in the Master's office the title deeds which were necessary in order to complete such sale.

THE original cause was instituted in 1823, for the purpose of administering the real and personal estate of the testator in the cause. At the death of the testator, his real estates were subject to several mortgages, and amongst them, to one vested in J. S. Beckett and R. P. Buddicom, who were afterwards made parties by supplemental bill.

By the decree, the real estates were directed to be sold subject to the mortgages, unless the mortgagees *consented to the sale; and [*344] an account was directed to be taken of what was due to the mortga

gees.

J. S. Beckett and R. P. Buddicom the mortgagees, (as was found by the Master's report in 1833,) consented to a sale of the estates free from their incumbrances; the estates were accordingly sold in lots, and produced considerably more than sufficient to pay all the incumbrances; the purchasers of the larger lots were to have the title deeds, and to covenant with the other purchasers for their production. The purchases were confirmed and the purchase money paid into court.

By a report dated in July, 1837, the Master certified, that it had been proposed, that the title deeds relating to the estates in question should be delivered to the respective purchasers thereof, on their executing certain deeds of covenant to the other purchasers of other parts of the premises; and he reported that such proposal ought to be carried into effect.

Accounts had been taken of what was due to the mortgagees, and the greater part of the amount due had been discharged by means of the funds in

court.

A petition was now presented, praying that J. S. Beckett and R. P. Buddicom, the mortgagees, might leave in the Master's office all the title deeds relating to the real estate of the testator, and that they might be delivered out upon completion of the purchases.

Mr. Kindersley and Mr. O. Anderdon, in support of the petition, contended that a mortgagee who was a party to a suit, and consented to a sale, could not refuse to produce the title deeds which were necessary for the

completion of the sales; for by consenting to a sale, he undertook [*345] to do all that was requisite on his part for effecting it.

Mr. Spence, contra, for the mortgagees, contended that a mortgagee could not be compelled to part with his title deeds or any other security, until he was actually paid; and that the payment of the money and the delivery of the deeds ought to be contemporaneous. That a deposit of the money in court was not sufficient to entitle the other parties to take from a mortgagee VOL. I.

27

1839. Livesey v. Harding.

his securities. The contrary was once held by Sir John Leach, but his deci sion was overruled by Lord Eldon.(a) Lord Kenyon's advice was, that a mortgagee should put his deeds in a box, and sit on the box until the mortgage money was actually paid.(b)

Mr. Pemberton, Mr. Treslove, Mr. Koe, and Mr. Bethell, for other parties. THE MASTER OF THE ROLLS (without hearing a reply.) It seems that the mortgagees have done a great deal in facilitating the sale of the property. They made no objection to producing the deeds and allowed them to be compared with the abstract; they have done right, but no more than they were bound to do under the circumstances; they do not stand in the situation of the mortgagee whom Lord Kenyon advised to put his deeds in a box, and sit on the box until the mortgage money was actually put into his hands: for they are parties to the cause and parties to the decree; and having consented to have their mortgage paid off, by means of the purchase money to be produced by

the sale of the property, I think that they became bound to facilitate [346] the *sale, and were not justified in creating an insuperable obstacle,

by insisting on the strict rights which they had in the first instance, and refusing to produce the deeds. The mortgagees, after having done every thing for the examination of the title and verifying the abstract, say, nearly at the conclusion of the affair, that they will not deposit their title deeds in the Master's office, until the time fixed for the payment of their mortgage money; but this is neither practicable nor reasonable, for the mortgagees must be paid out of the purchase money, which cannot be done until the purchasers are in a situation to release the fund, and that will not occur until they have had their conveyances; they cannot have their conveyances until covenants to produce the title deeds have been executed, and this cannot be done until the purchasers of the larger lots have possession of the deeds which they covenant to produce. It is said, fix a time for payment; but how is it possible to do it, and how can the mortgagees be in any way injured? the time cannot be fixed without the deeds being first brought into court.

I think it my duty to order the deeds into court: but I will make this addition to the order, that they are not to be delivered out without notice to the mortgagees.[1]

(a) See Postlethwaite v. Blyth, 3 Mad. 242; S. C. 2 Swans. 256.

(b) See Sparke v. Montriou, 1 Y. & Coll. 107.

says:

"I

[1] A mortgagee is not bound to produce his mortgage deed to the devisee of the mortgaged estate, until payment of principal and interest, notwithstanding the devisee may be ignorant of the amount of the interest, the time of payment, and all the other particulars of the security. Browne v. Lockhart, 10 Sim. 421. In Bentinck v. Willink, 2 Hare, 8, Wigram, V. C., believe that no point is better settled than this--that where a mortgagor is proceeding against his mortgagee, a court of equity will not compel the mortgagee to produce his securities, except on payment of the mortgagee's claim; and the rule does not depend upon any peculiarities of system, but is founded on principles of abstract justice."