signees in bankruptcy. All the bill alleges upon the subject is that he was advised to purchase from his assignees in bankruptcy his claim against the trustee, and that he accordingly procured an assignment. Express provision was made by section 9 of the bankrupt act of the 19th of August, 1841, that all sales, transfers and other conveyances of the assignee of the bankrupt's property and rights of property shall be made at such times and in such manner as shall be ordered and appointed by the court in bankruptcy, and the supreme court of Massachusetts decided, in the case of Osborn v. Basterral, 4 Cush., 406, that the sale of a bankrupt's real estate under an order of the district court, in which no time or place of sale was fixed by the court, is irregular and void. In general, when a sale is made under a statute power, said Shaw, Ch. J., it must appear that the requisitions of the statute as conditions precedent to the operation of the power to pass the estate have been complied with. When the title to real estate is solely through a power, it must, in order to be sustainable, be proved that such power was duly executed. Cleveland v. Boerum, 27 Barb., 254. Title was claimed, it will be seen, in both of those cases under purchases by strangers to the proceedings in bankruptcy, and consequently their claim of title rested solely upon the assumption that the power to sell was duly executed by the assignee. Unlike what occurred in those cases, the purchase in the case before the court was made by the bankrupt, whose title, in the case of onerous property, where the assignee elects not to take it into possession, is good against all the world, except the assignee or some one to whom he conveyed the property. Smith v. Gordon, 6 Law Rep., 317. All the property and rights of property belonging to the bankrupt unquestionably pass by force of the decree of bankruptcy to the assignee by operation of law, and become vested in him as soon as he is appointed. But though the legal title passes to the assignee, he is not bound, said Judge Ware, to take possession of all the property. Leasehold estates pass to the assignee under the English bankrupt laws, but the assignee is not bound to take the lease and charge the estate with the payment of the rent, as the rent may be greater than the value of the lease, and thus the estate may be burdened instead of being benefited, and in such a case the claim may be abandoned by the assignee. He is not bound in such a case to take the property into his possession, and, if he elects not to take the property, it remains in the bankrupt, and no one certainly, except the assignee, has a right to dispute his possession. Copeland v. Stephens, 1 Barn. & Ald., 603; Fowler v. Down, 1 Bos. & Pull., 44.

§ 955.

after the lapse of years a presumption arises that the assignes elected not to take the property.

Years have elapsed since the proceedings in bankruptcy were closed, and the irresistible conclusion from all the averments of the bill is, that the assignee never elected to take possession of this property, or made any claim whatever upon the trustee for the same. Assignees may refuse to take possession of onerous properties, or such as will be a burden instead of a profit, and the clear presumption from the bill, as admitted by the demurrer, is that the claim against the trustee was regarded in that light by the assignee. Robeson says it has long been a recognized principle of the bankrupt law that the assignees of a bankrupt are not bound to take property of an onerous or unprofitable character, or property which will be a burden instead of a benefit. They are, on that subject, regarded as being in a very different position from that of the executors of a deceased testator, as the former take the property by operation

of law, while the latter claim title through their testator, and are bound to perform his obligations to the extent of his assets. Robeson, Bankruptcy, 322. Where the assignee elects not to take the right of the bankrupt and charge the estate with the burden of an uncertain litigation, the right, whatever it is, survives in the bankrupt, and some of the authorities hold that it may be pursued by any creditor not a party to the proceedings in bankruptcy. Smith v. Gordon, 6 Law Rep., 317. Persons acting as assignees in such a case are required to elect within a reasonable time, and the rule is, that, if they refuse to elect when required to do so, it is deemed an election to reject the estate. Lawrence v. Knowles, 5 Bing. (N. C.), 150; Carter v. Warne, 4 Car. & P., 336; Graham v. Van Dieman Land Co., 11 Exch., 101; Ex parte Blandy, 1 Dea., 286; Tuck v. Fyson, 6 Bing., 321.

§ 956. Reasonable presumptions are admitted by a demurrer.

Doubtless the complainant, in such a case, must allege or prove enough to show that the assignee is estopped to set up any right in opposition to his claim, and the court is of the opinion that enough is alleged in this case to satisfy that requirement. Reasonable presumptions are admitted by the demurrer as well as the matters expressly alleged. Pursuant to advice which the complainant received to purchase from his assignees his claim against the trustee, the allegation is that he procured an assignment of the same, which must be understood in this award as a transfer of all the property and estate embraced in the claim which he was advised to purchase by an appropriate legal instrument. Suppose that is so, still the argument is that the allegation was not sufficient, because it is not alleged that the sale was made by the order of the bankrupt court; but the opinion of the court is that such a prior order was not necessary, under the circumstances of this case, to give validity to the sale, or if it was, that the reasonable presumption, from the allegation of the bill, is that the assignment was made in pursuance of such an order of court. Independent of the assignment, his title, under the circumstances of that case, was good against all the world except the assignee, as the presumption is that the property was regarded as onerous, and that the assignee elected not to take it into possession. or to prosecute the claim.

The next objection is that the cause of action is barred by the two years' limitation in the bankrupt law under which the complainant was adjudged a bankrupt. Suffice it to say that the limitation does not apply to the case of an assignee, which is all that need be said upon the subject in the present case. Banks v. Ogden, 2 Wall., 69.

957. The waiver of the oath of defendant to his answer in a bill does not amount to anything, unless it is accepted by the defendant.

It is also objected that the complainant attempted to deprive the respondents of their right to an answer under oath; but the controlling answer to the objection is, that it can have no such effect, as the waiver amounts to nothing unless the respondents accept it. Heath v. Erie R'y Co., 8 Blatch., 412; Story Eq. Plea., 874. Bill dismissed as to the executors and devisces. Decree for complainant against Thomas C. Amory.

$958. When the right to enforce a mortgage accrues.- Under a deed of trust authorizing a sale upon default in the payment of interest, a sale upon such default is authorized although the deed does not show when the interest is payable or what the rate of it is, except by reference to the note secured. Richards v. Holmes, 18 How., 143 (§§ 1175–79).

$959. Whole debt due upon default.- A provision in a mortgage or bond, that upon the maturity of an instalment without payment the whole debt shall become due, is valid and may be enforced. Olcott v. Bynum, 17 Wall.. 44, 62.

§ 960. An option to declare the principal due upon default in payment of interest must be declared within a short and reasonable time after the right to do so has accrued; and after a delay of six weeks it has been held to be too late to give an effectual notice. Wilson v. Winter, 6 Fed. R., 16 ( 637-640).

§ 961. An agreement to extend the time of the payment of mortgage notes takes the mortgage out of the operation of the statute of limitations as between the original parties only, and not as between the mortgagee and innocent purchasers, who had no notice of such extension. Wyman v. Russell,* 4 Biss., 307.

§ 962. Proceedings at law and equity at same time.- An election to sue at law upon a note secured by mortgage does not make it necessary for the holder to exhaust his remedies in that forum before he can go into equity to enforce his mortgage. He may proceed at law and in equity at the same time, and until actual satisfaction of the debt has been obtained. Ober v. Gallagher, 3 Otto, 199, 208.

§ 963. The holder of a note secured by mortgage may proceed at law or in equity or both at the same time. Upon obtaining a judgment upon the note, this is merged in the judg ment, but the mortgage lien is not merged. This is transferred from the note to the judg ment. Ibid.

§ 964. Attachment of equity of redemption.-In Maine an attachment of the right, title and interest of a debtor in lands binds his equity of redemption in mortgaged land, and this can be levied on as such only by sale at auction. If an execution be extended upon mortgaged land it binds the fee subject to the mortgage, but in such case the title dates from the seizure on execution and not from the attachment. Coggswell v. Warren, 1 Cuit., 223

§ 95. In this state an execution for the same debt secured by the mortgage may be levied on the mortgaged land. Ibid.

§ 966. Execution upon mortgage debt.- At common law an equity of redemption cannot be sold on execution obtained upon the mortgage debt. Hill v. Smith,* 2 McL., 446.

§ 957. A discharge in bankruptcy of the mortgagor does not prevent a foreclosure of the mortgage by an action in rem or by a bill in equity. The proceeding in such a suit does not compel the bankrupt to pay the debt for which the mortgage was given, but simply forecloses his right to redeem, unless he shall voluntarily pay the debt. It acts, therefore, not at all in personam, but solely in rem. In re Bellows, 3 Story, 439.

§ 968. Mortgage to surety enforced for principal creditor.— A mortgage to a surety to indemnify him for securing debts of the mortgagor will inure to the benefit of the creditors to whom the surety has become bound, and upon the bankruptcy of the mortgagor, a court of bankruptcy, or a court of equity, will enforce the mortgage for their benefit. In re Pierce, 2 Low., 343, 344.

§ 969. Where a state court has acquired jurisdiction of the subject-matter of a cause, its decree is a bar to an action for the same cause in a federal court. Stout v. Lye, 13 Otto, 66 (S$ 1001-1003).

$970. After a court of bankruptcy has taken jurisdiction by ordering a sale of the mortgaged premises discharged of liens, a state court has no jurisdiction to foreclose the mortgage. In re Devore,* 16 N. B. R., 56.

§ 971. State court not ousted by petition in bankruptcy.—The filing of a petition in bankruptcy in a federal court and the adjudication of bankruptcy therein does not divest a state court of jurisdiction over a pending suit on a mortgage of the bankrupt's property, nor deprive the plaintiff in the foreclosure suit of his right to execute the decree of foreclosure by a sale of the property. In re Irving, 8 Ben., 463, 468.

§ 972. A decree of foreclosure in the state court and a sale thereunder, made after the filing of a petition in bankruptcy of the mortgagor, are a bar to any right of the assignee to set aside the foreclosure sale by suit in a federal court, or to raise the question of usury in the mortgage. Cutter v. Dingee, 8 Ben., 469.

§ 973. Foreclosure by scire facias under the statute of Illinois is only allowed where the mortgage has been dúly executed and recorded; and a mortgage is not duly acknowledged if the notary public has failed to affix his seal to the certificate of acknowledgment. Kenosha R. Co. v. Sperry.* 3 Biss., 309.

§ 974. In Kansas any suit for the sale of mortgaged property must be brought within the county in which such property is situated. But a judgment may be rendered on a note (secured by mortgage) in a county in which the mortgaged property does not lie. App v. Bridge,* 1 McCahon, 118.

§ 975. In Louisiana, in order to make a valid sale of land under a foreclosure of a mortgage, it is indispensably necessary, in all parishes except Jefferson and Orleans, that there should be an actual seizure of the land; not, perhaps, an actual turning out of the party in possession, but some taking possession of it by the sheriff, not merely constructively. Watson v. Bondurant,* 21 Wall.. 123.

§ 976. The pact de non alienandɔ does not relieve a mortgagee from the necessity of pursuing the forms of law in making a sale. Ibid.

§ 977. The facts in regard to a sheriff's sale may be inquired into where the sheriff's return is incomplete. Ibid.

$978. In Louisiana a mortgage by public act, although it imports a confession of judgment, may be enforced in the United States courts by suit in equity. Benjamin v. Cavaroc, 2 Woods, 168, 171.

$979. Where a lien exists on property in Louisiana by special mortgage, and upon the mortgagor's death the property passes with the lien attached into the hands of a curator, the circuit court of the United States has jurisdiction to enforce a sale. Erwin v. Lowry, 7 How., 172, 180.

XXIV. FORECLOSURE BY ENTRY AND POSSESSION AND BY WRIT OF ENTRY.

§ 980. Entry for condition broken in presence of two witnesses. In Massachusetts, under statutes of 1788, ch. 22, and of 1798, ch. 77, it was necessary not only that the mortgagee should enter after condition broken in the presence of two witnesses, but also that the entry should be known by them to be for condition broken and to foreclose the mortgage. Gordon v. Lewis,* 1 Sumn., 525.

§ 9-1. Entry upon one of several lots.- An entry upon one of several distinct and detached parcels of land in the same county, mortgaged in one deed for the performance of the same condition, and in possession of the same person, is a good entry upon all. Shapley v. Rangeley, 1 Woodb. & M., 213, 218.

§ 982. Assignment by mortgagee after completed foreclosure. Where a mortgagee, having made entry upon land and completed a foreclosure by possession, receives from a third person, with the assent of the mortgagor, the mortgage debt, and assigns his interest to that person, the latter holds an absolute estate, and the transaction is not a mere discharge of the mortgage. Ibid.

§ 983. A writ of entry to foreclose a mortgage may be well maintained against a tenant in possession under the mortgage. Fales v. Gibbs,* 5 Mason, 462.

§ 984. In a writ of entry to foreclose a mortgage, the declaration should allege the seizin to be in mortgage and should show that a foreclosure is desired, rather than possession for the purpose of taking profits. Fiedler v. Carpenter, 2 Woodb. & M., 211.

§ 985. The fact that a mortgage contains a power of sale is no objection to a foreclosure by writ of entry. The power of sale is merely a cumulative remedy which does not interfere with a foreclosure by action, or by entry and possession. Furbish v. Sears,* 2 Cliff., 454.

§ 986. A judgment in a writ of entry, to foreclose a mortgage, operates only as between the parties to the suit. A judgment of foreclosure against the mortgagor, rendered long subsequent to the assignment by him of his right to redeem, cannot operate against the assignee. Gordon v. Hobart, 2 Sumn., 406.

XXV. PARTIES TO EQUITABLE SUITS FOR FORECLOSURE.

SUMMARY-Mortgagor after conveying not a necessary party, § 987.-When mortgagor's wife not a necessary party by reason of homestead right, § 988.— Attaching creditor a proper party, § 989.-Judgment pendente lite, § 990.

$987. A mortgagor who has conveyed his equity of redemption is not a necessary party to a foreclosure bill. Townsend Savings Bank v. Epping $ 991-998.

$988. If for any reason the mortgage is paramount to the right of homestead, the mortgagor's wife is not a necessary though a proper party, by reason of such right. Ibid.

§ 989. An attaching creditor is a proper party to foreclosure proceedings. If his attachment is made before the inception of such proceedings, he is not bound, and has a right to redeem unless made a party. Dickinson v. Lamoille County Nat. Bank, $ 999, 1000.

§ 990. A creditor obtaining a judgment pending a suit to foreclose a mortgage of the debtor's property is bound by the decree. A mortgagor in a foreclosure suit represents all who pendente lite acquire any claim through him. Stout v. Lye, §§ 1001-1003.

[NOTES.-See §§ 1004-1024.]

335

TOWNSEND SAVINGS BANK v. EPPING.;

(Circuit Court for Georgia: 3 Woods, 390-397. 1877.)

Opinion by Bradley, J.

STATEMENT OF FACTS.-The defendant Aiken, and one Goodrich, being in partnership and about to run a steam saw-mill on Herd Island, near the mouth. of the river Altamaha, in September, 1866, borrowed of the bank corporation, complainant, the sum of $15,000, and, to secure the payment thereof, executed and delivered to the said bank their three promissory notes for $5,000 each, payable on demand, with interest half-yearly in advance, and a mortgage upon the whole tract comprised on Herd's Island, including the saw-mill thereon, with the engines, machinery, etc. The other complainants joined in the notes as sureties. The constitution of Georgia, adopted in 1868, secured to every head of a family a homestead of realty to the value of $2,000, and personal property to the value of $1,000, to be exempt from execution and sale. The legislature afterwards prescribed the mode of setting apart and securing such homestead and property to the sole use and benefit of the family of the party claiming the same. The legislature of Georgia also, in 1868, passed a law giving to employees employed in any steam saw-mill, and to any person furnishing any steam saw-mill with timber, saw logs or provisions, or with anything necessary to carry on the work of said mill, a lien of the highest dignity upon said mill for any debts, dues, wages or demands against the owner for such service, timber or other necessaries, and prescribed the method of executing said lien.

Goodrich having sold out his interest in the saw-mill and property to Aiken, the latter, in 1870, took the requisite proceedings for having set off, as homestead, a large part of Herd's Island (not including the saw-mill), but including for personal property, to be exempt from execution, portions of the machinery of the mill. Carl Epping, one of the defendants, in 1870, placed a lien on the mill for timber furnished thereto, and took out an execution to sell the same for a debt of about $5,000. John Strickland placed another lien upon the mill for about $130. Under the latter the mill was put up to sale, and sold to Epping for $5,100 — against the protest of the complainant corporation. Epping claims to hold the whole amount of his bid by virtue of his lien and that of Strickland's as paramount claims to that of the complainant under its mortgage. The complainants in the present suit seek a decree to foreclose the mortgage given to the bank complainant (which has never been paid), and to set aside as null and void the sale under the lien of Strickland, and to declare the said lien, as well as that of Epping, subordinate to the said mortgage, and for a sale of the property under and by virtue of the mortgage, free and clear of said liens; or, if this cannot be done, that the purchase money bid by Epping at the lien sale may be declared to belong to the complainant. The complainants also seek to be relieved against Aiken's claim to a homestead.

§ 991. Homestead exemptions are subordinate to antecedent liens.

The decision of the supreme court of the United States in the case of Gunn v. Barry, 15 Wall., 610, has disposed of the question relating to the claim of homestead. That court held that the homestead exemption secured by the constitution of Georgia, adopted in 1868, does not affect liens created prior to that time, and cannot be set up in derogation thereof; and accordingly, in view of this decision, the counsel for the defendants very properly abandoned that defense.