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1844.

GRUBB

v.

PERRY.

practice in the Six Clerks' office (a), derived, perhaps, from considerations in favour of the liberty of the subject. However, reckoning in this manner, the replication was regularly filed, and the Defendant has had the time which the practice of the Court allowed him for answering.

The other question is, if the Defendant must determine within the eight days whether he will take exceptions for impertinence, and I think it must be so, for when the subpoena to rejoin has been served, new duties arise, the cause being at issue, the parties proceed to hearing on the record as it then is, and exceptions cannot afterwards be filed without leave. I am therefore of opinion that this application must be granted, and the exceptions must be taken off the file. The Defendant will not be without remedy, for if there be impertinence in the bill, he may get it expunged, but he must make a special application for that purpose. (b)

(a) Mootham v. Waskett, 1 Mer. 243.; Manners v. Bryan, 1 Myl. & K. 453.; S. C. 5 Sim. 147. and 148. n.; M'Intosh v. Great Western Railway Company, 1 Hare, 351.; Richardson V. Horton, 5 Beav. 91.

(b) See Jeffray v. M'Cabe, 1 Russ. & Myl. 759.; Bradbury v.

Booker, 4 Sim. 525.; Kinworthy v. Allen, 1 Bro. C. C. 400.; Anonymous, 2 Ves. sen. 631.; Anonymous, 5 Ves. 656.; Pellew v.

6 Ves. 456.; Beavan v. Waterhouse, 2 Beav. 58.; Everelt v. Prythergch, 12 Sim. 363.; and Stanley v. Bond, 5 Beav. 175.

1844.

BY

AMES v. PARKINSON.

June 5. 7.

tee neglects to invest on

real or go

vernment se

Y his will, the testator directed his executors, Where a trus"within twelve months after his decease, out of his personal estate, to lay out and invest in their or his names or name the sum of 1500l. on mortgage of freehold or copyhold estates of inheritance or on government securities," and which they were to hold upon certain trusts under which the Plaintiffs were interested.

The testator died on the 27th of December 1825, pos

curities ac-
cording to the

trust, the
cestui que

trust has the
right of se-
lecting whe-
ther the

trustee shall

be answerable

sessed of three mortgages on freehold estates for 800 for the money

or for the

stock.

An ex

500, and 2007., besides other property. His assets were admitted to have been more than sufficient to pay his debts, funeral expenses, and legacies, and it ap- ecutor and peared that the Defendant, his executor, was interested in the residue.

trustee directed to invest a legacy

on mortgage,

may properly

one of the

On the 27th of December 1826, the executor appro- appropriate priated the three mortgages of 500l., 2001., and 8007. testator's for the purpose of answering the legacy of 1500l., which mortgages in the executor had the option of investing on mortgage or the legacy, government securities.

payment of

but he must ascertain its sufficiency. A trustee,

The mortgage for 500l. was paid off, and the produce having the properly invested.

The mortgage for 800l. was paid off in May 1836,

and was placed in the hands of Messrs. Gurney, bankers, to a deposit account, in the name of the surviving exe

option of investing on mortgage or

government

security, improperly took an insufficient mortgage secutor. curity. Being held answer

able, the Court decided, that having exercised his discretion, though improperly, he was answerable for the money lost, and not for the stock it might have produced,

1844.

AMES

v.

PARKINSON.

cutor.

The account was distinct from his own account, but the money was, in no way, marked as trust money.

The 2001. was alleged and appeared to be invested upon an insufficient security, and the mortgagor was insolvent.

This bill was filed in 1842, by parties interested in the 15007. legacy, against the surviving executor, seeking to make him liable for the loss occasioned by the alleged non-investment of the legacy within twelve months after the testator's death.

The price of the funds had risen, so that it would be more beneficial to the Plaintiffs to make the Defendant account for the stock which might have been purchased, than for the money.

Mr. Kindersley and Mr. Busk for the Plaintiffs.

The executors never complied with the direction of the will. They might have invested the money on mortgage, yet it was to be "in their names;" but they had no authority to appropriate the testator's mortgage in discharge of the legacy, thus leaving the securities in the name of the testator, instead of that of the trustees.

As to the 2007. mortgage, the executor did not exercise a proper discretion. The mortgage property is proved to be worth no more than 150l., and the mortgagor is insolvent. The Defendant is interested in the residuary estate, and would have the benefit of appropriating bad securities to the payment of the legatee; he is therefore liable; Stickney v. Sewell. (a)

(a) 1 Myl. & Cr. 8.

The

The Defendant committed a breach of trust by lending the 800%. on a deposit account with his bankers, and as to all the funds, the cestui que trust has the option of recovering either the money or the stock, which would have been produced by a proper investment in the funds at the proper time; Watts v. Girdlestone. (a)

Mr. Turner and Mr. Adams, contrà. The executor had a discretion, and has been guilty of no default in appropriating the testator's own mortgages in discharge of the legacy of 1500l., for he has substantially fulfilled the directions of the testator. It would have been absurd for him to have realised the mortgages, and then to have reinvested the produce in the same securities to answer the legacy.

As to the two mortgages for 500l. and 800l., they have been realised, and no complaint can therefore be made as to those securities.

As to the 2001. mortgage, there is no allegation that, at the time of the appropriation, the Defendant was aware that it was a deficient security, and it may have become depreciated since. If a trustee acts bona fide to the best of his judgment and without corrupt motives, the Court will not charge him, though the security he has taken may ultimately turn out deficient. There is no case," in which an executor has been called upon to bear the loss that has arisen, because, in the bonâ fide exercise of a reasonable discretion, the conclusion he came to has turned out unfortunately;" Buxton v. Buxton. (b) At all events, the Defendant is entitled to an enquiry on the subject.

With

1844.

AMES

v.

PARKINSON.

(a) 6 Beav. 188.

VOL. VII.

(b) 1 Myl. & Cr. 96.

Cc

1844.

AMES

v.

PARKINSON.

With regard to the deposit of the 800l., the Plaintiffs have acquiesced, for it appears they witnessed the receipts for the interest signed by the tenant for life. The Defendant has not received any personal benefit from the investment, and there being a discretion either to invest on real security or in the funds, he is to be charged with the money only, and not with the stock. It was decided by Sir John Leach, in Marsh v. Hunter (a), "that if trustees may invest in stock or on real security, and they lend on personal security, and thereby the money is lost, they shall be answerable, not for the amount of stock which might have been purchased, but for the principal money lost." If real security had been taken, the principal money only would have been forthcoming to the trust, and the want of real security is all that is imputable to the trustees.

Lastly, the Defendant has been found a lunatic, and is shewn by the evidence to have had fits of partial insanity before the time from which he is found by the inquisition to have been a lunatic. He is not, therefore, responsible for his acts or defaults.

Mr. Kindersley in reply.

Hall v. Hallet (b), and Hockley v. Bantock (c) were also cited.

The MASTER of the ROLLS.

One ground of defence in this case is, that the Defendant has been found a lunatic by inquisition, which carries back the lunacy to December 1840, a period subsequent to the time when the several transactions, in respect

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