An obligor of a boud, after notice that it had been assigned on trusts, of the particulars of which there was no proof of his being cognizant, made payments to parties not entitled thereto, some by order of the trustee, and some to the executrix of the obligee, without such order: Held, that the obligor was not responsible to the cestui que trust for the former, but was liable to repay

the latter.

Party suing in forma pauperis, and proving successful, declared entitled to ordinary costs.

On the 25th of October, 1821, Lord Mostyn and Mr. Mostyn executed a bond in a penal sum for securing to Rebecca Roberts the sum of 1000l. and interest; and on the 12th day of February, 1828, Rebecca Roberts, having

three daughters, Jane, the wife of James Batten, the plaintiff, Maria [*377] Catharine Roberts, and the defendant Margaret Roberts, executed

a deed poll, whereby, after reciting the bond, and that the sum of 10007. remained due thereon, and that she was desirous of making provision for her daughters and the children of her daughter Jane, she assigned to the defendant David Lloyd, his executors, administrators and assigns, the said bond and the money due thereon, and her right and interest in and to the same, on trust to permit her, Rebecca Roberts, to receive the interest thereof during her life, and after her death to pay her daughter Jane the sum of 3331. 6s. Ed., being one-third of the said sum of 1000l., and as to the sum of 6667. 13s. 4d., the remaining two-thirds of the money due on the bond, on trust to place out the same in government or other good securities, or to allow the same to remain on the present security, and to permit her daughter the plaintiff, and the defendant Margaret, to receive the interest and dividends thereof during their joint lives; and after the death of either to permit the other to receive the interest of one moiety thereof, and to pay the other moiety to the children of Jane Batten; and after the death of the survivor of the plaintiff and her sister Margaret, to divide the remainder of the 1000l. amongst the children of Jane Batten; and the deed poll contained a power of attorney to enable David Lloyd to get in the debt.

There was no direct evidence to show when Mr. Lloyd was first informed of the bond and of the deed poll, nor when notice of the deed poll was first given to Lord Mostyn ; but on the 28th of July, 1823, Mrs. Roberts and Batten and wife informed Lord Mostyn that Mrs. Roberts had given them onethird of the money secured on the bond, to be paid on the death of Mrs. Roberts, and was afterwards desirous that Jane Batten should have [*378] 1007. in her lifetime; and Mrs. *Roberts and Batten and wife then requested Lord Mostyn to pay 100l., part of the 10007. which he accordingly did; afterwards (in February, 1829,) Mrs. Roberts requested Lord Mostyn to pay the further sum of 2331. 6s. 8d. to Jane Batten, and that request was some time afterwards complied with. In a letter of James Batten,

1840-Roberts v. Lloyd.

which accompanied this request, he stated the sum of 2331. 6s. 8d. to be due to his wife by assignment.

In this way the third part of the fund which was intended for Mrs. Batten after the death of Mrs. Roberts, was exhausted in her lifetime. How far Mr. Lloyd was cognizant of these payments appeared only by certain articles of agreement, bearing date the 23d day of May, 1831, and which were made and executed by and between Mr. Lloyd, of the one part, and William Batten, Joseph Batten and Jane Batten, the three children of Jane Batten, of the other part. These articles of agreement recited the bond and the deed poll, and, that by indorsements on the bond, dated respectively the 28th day of July, 1828, and the 29th day of April, 1829, the several sums of 100l. and 2331. 6s. 8d., making together 3331. 6s. Sd. one-third part of the trust money, wereby orders under the hand of Rebecca Roberts, and with the consent of David Lloyd, advanced to her daughter Jane; and they further recited, that Wil liam, Joseph and Jane Batten, having occasion for 3007., had applied to Mr. Lloyd for an order on Lord Mostyn for the same, which he had agreed to give them on their entering into the conditions after mentioned for payment of the interest to him as therein mentioned; and thereupon Mr. Lloyd promised to give an order upon Lord Mestyn for payment of the 300Z., and to accept from the three Battens 15l. annually in lieu of the lawful interest *of the same sum of 3001., and the three Battens promised to pay that [*379] interest and to indemnify Mr. Lloyd.

These articles of agreement were dated the 23d of May, and on the 29th of August following, a receipt was given by James Batten to Lord Mostyn for 3007., stated to be paid by virtue of an order made on Lord Mostyn by Mr. Lloyd, and that the money was part of a bond debt originally due to Rebecca Roberts, and afterwards by her conveyed to David Lloyd, on trust for uses; 1007., part of this sum of 3007., was in fact paid on the 28th of April, the remaining 2007. on the 29th of August.

After this payment, a sum of 3667. 13s. 4d. remained due on the bond. On the 28th of March, 1832, the further sum of 66l. 13s. 4d. was paid by Lord Mostyn to James Batten, who gave a receipt for it as paid by virtue of an order of Mr. Lloyd, and that the money was due on bond to Rebecca Roberts, and assigned by her to David Lloyd in trust for certain uses; and soon afterwards William Batten and Joseph Batten requested Mr. Lloyd to advance them a further sum of 100l. For this Mr. Lloyd required security; and on the 8th of June, 1832, William, Joseph and James Batten and Robert Davies executed a bond to Mr. Lloyd for 2007., in which after reciting the deed poll, and that there was then due and owing to David Lloyd by virtue of the bond 3001, and that he, David Lloyd, had agreed to advance to William and Joseph Batten 1007. cn account of their shares on execution of that bond, the condition was stated to be for payment to David Lloyd of the interest of 1007. at 51. per cent., during the lives of Rebecca Roberts, the plaintiff, and the defendant Mary Roberts.

1840-Roberts v. Lloyd.

[*380] *On the 11th of June, three days after the execution of the lastmentioned bond, Mr. Lloyd signed an order for payment by Lord Mostyn to Janies Batten of another sum of 1007., and Lord Mostyn accordingly paid it on the 27th of July, 1832.

'There was no evidence of any further act or interference on the part of Mr. Lloyd.

Mrs. Roberts died on the 22d of November, 1832, and Jane Roberts was appointed executrix of her will. At the time of Mrs. Roberts' death, the sum of 2001. remained due on the bond; and on the 30th of November, Lord Mostyn paid it to Jane Batten and Janies Batten, as it seemed, without any order or authority from Mr. Lloyd.

This bill was filed by Maria C. Roberts, who sued in forma pauperis, and it prayed a declaration that the defendant David Lloyd had committed a breach of trust in respect of the sum of 6667. 13s. 4d., part of the sum of 1000!., which was secured to be paid by the defendant Lord Mostyn to Rebecca Roberts deceased; and that the same sum of 6661. 13s. 4d. might be secured, and that Lord Mostyn might be declared to be answerable to the plaintiff for 2007. paid by him, and for any other sum which he paid with knowledge of the trusts in the bill mentioned.

Mr. Pemberton and Mr. Kenyon, for the plaintiff, contended that Lord Mostyn had notice of the settlement, and having, with such notice of the plaintiff's rights, paid the sum of 6667. 13s. 4d. to parties not entitled thereto, he was liable to repay it; that Lloyd was liable for the amount paid by Lord Mostyn to parties under his order or with his concurrence; and [*381] *that the plaintiff would be entitled to a decree, and with costs, notwithstanding she sued as pauper.

Mr. James Russell, for the defendant Lloyd, contended that Lloyd had not full notice of the assignment of the bond; that the trusts had never been perfected by delivery of the bond to the trustee, or, so far as it had been proved, by communication with the plaintiff; that the transaction being voluntary, and the legal interest remaining in the settlor, this court would not carry it into execution. Tufnell v. Constable,' a) Edwards v. Jones,(b) Coppin v. Dillon.(c) He contended, also, that the plaintiff, if successful, could only recover pauper costs.

Mr. Stuart and Mr. Parry, for Lord Mostyn, contended that Lord Mostyn had no notice of any trust in favor of the plaintiff, and that he had not seen any copy of the deed; that the payments by the direction of Lloyd at least were valid; and that the payment of the 2001. on the delivery up of the bond was good, Martyn v. Kingsly ;(d) that no effective transfer had been made of the bond, Loveridge v. Cooper,(e) Jones v. Gibbons,(g) as no notice of the

(a) 8 Simons, 69.

(c) Decided by the Lord Chancellor, Dec. 24, 1839. (e) 3 Russ. 58.

(b) 1 Myl. & Cr. 226.

(d) Prec. Ch. 209.

(g) 9 Ves. 407.

1840.-Roberts v Lloyd.

deed of trust had been served upon the obligor, as ought to have been done; aud that the bond had been retained in the hands of the settlor.

Mr. Pemberton, in reply:-The trusts being well created, and being accepted by the trustee, cannot be impeached. This suit does not seek

to establish the settlement of the bond against the *donor, but against [*382] a trustee for a breach of trust, and against the obligor for paying after notice of an assignment of the bond. Legh v. Legh,(a) Ellis v. Nimmo(b) were also cited.

March 21.-THE MASTER OF THE ROLLS:-It is plain that Mr. Lloyd was fully aware of the bond, and of the deed poll, and of the trusts conferred upon him; that he accepted the trusts, and took an active part in procuring payment from Lord Mostyn of different sums of money for purposes inconsistent with the trusts which he had accepted. There are the articles of the 23d of May, 1931, reciting the bond and deed poll, his consent to the payment of one-third part of the sum of 1000l. to Jane Batten, and showing the arrangement under which he was to procure payment of a further sum of 3001., upon having payment of the interest thereof secured to himself. There is not, as against him, direct evidence of an order for the payment of the 667. 13s. 4d., but there is the subsequent bond, reciting that the sum of 3001. remained due to him, and this was the sum actually due after deducting the 661. 13s. 4d.

It is clear, therefore, that not by his acquiescence alone, but by his acts, the three sums, amounting together to 4667. 13s. 4d., were withdrawn from the scurity of Lord Mostyn's bond.

Now it is evident that Lord Mostyn had notice that the bond had been assigned to Mr. Lloyd, and he had recognized Mr. Lloyd as the person upon whose order the money was to be paid. On the 29th of August, 1831, he took from James Batten a receipt, stating that the money [*383] was paid by virtue of an order made by Mr. Lloyd, and that the money was part of a bond debt originally due to Rebecca Roberts, and afterwards by her conveyed to David Lloyd on trust for uses. On the 28th of March, 1832, he paid the sum of 667. 13s. 4d. on a like receipt, stating an order of Mr. Lloyd, and that the money was due on bond to Rebecca Roberts, and assigned by her to David Lloyd, on trust for certain uses; and in July, 1832, he paid the further sum of 100%. on the order of Mr. Lloyd, which has been proved.

I do not think that Lord Mostyn is answerable for any of these sums: he had the authority of Mr. Lloyd for paying them, and was, I think, justified in making the payments.

But with respect to the 2001. paid after the death of Mrs. Roberts, he had no authority whatever; he paid the money on the receipt of Jane and James Batten, and on delivery up of the bond; but he knew that the right to the

1839. Cullingworth v. Loyd

money due on the boud had been transferred to Mr. Lloyd, on trust for certain uses; and I think that he might, and if he had been duly cautious would have refused payment without the authority of Mr. Lloyd; and that if an attempt had been made to compel payment at law, this court would have protected him; and, under these circumstances, I think that for the 2001. and the interest of it, he is answerable to Mr. Lloyd and the persons for whom Mr. Lloyd is trustee.

It is argued that the plaintiff has no right to any relief, because the gift or declaration of trust in favor of the children and grandchildren of Rebecca

Roberts was never complete; and it was particularly relied upon that [*384] the bond and deed poll remained in the possession of Mrs. Roberts up

to the time of her death: upon this subject, however, there is no evidence. Jane Batten was appointed the executrix of Mrs. Roberts' will, and her husband, James Batten, had on several occasions acted as agent of Mr. Lloyd as to the bond. After the death of Mrs. Roberts, the bond was in the possession of James Batten; when he obtained it, or whether as the agent of Mr. Lloyd, does not appear by direct evidence; but all the circumstances concur in showing Lloyd accepted the assignment of the bond and undertook the trusts upon which the assignment was made: the bond ought to have been in his possession; and it cannot be presumed that he acted as he did, without having it, as he certainly had a right to have it, in his power; and 1 am of opinion that Mrs. Roberts did every thing incumbent on her to make the trust complete and valid, and that the plaintiff is entitled to the benefit of it.

I am therefore of opinion, that the plaintiff is entitled to have the 4667. 13s. 4d. paid into court by Mr. Lloyd and the 200l. paid by Lord Mostyn, and that she and her sister are entitled to have the interest paid according to the trusts of the deed poll, and, although a pauper, entitled to costs.[1]

Upon a composition between a debtor and his creditors, a creditor cannot ostensibly accept a composition, and sign the deed which expresses his acceptance of the terms, and at the same time stipulate for or secure to himself a peculiar and separate advantage which is not expressed upon

the deed.

A creditor holding a security for his debt may stipulate to have the benefit of it, in addition to the amount of the composition offered by a debtor to his creditors; but he must either hold himself entirely aloof from the other creditors, or distinctly communicate with them on the subject, if he at all acts in common with them

A debtor entered into a negotiation for a compromise with his creditors, but there did not appear to have been any general meeting of them, or any agreement entered into by them generally, one of the creditors stipulated that he should have the benefit of a mortgage security which he

[1] As to costs of a party suing in forma pauperis, see further, Bolton v. Gardiner, 3 Paige, 273.