Bugden v Bignold
| Jurisdiction | England & Wales |
| Judgment Date | 29 June 1843 |
| Date | 29 June 1843 |
| Court | High Court of Chancery |
English Reports Citation: 63 E.R. 167
HIGH COURT OF CHANCERY
Considered, In re Mower's Trusts, 1869, L. R. 8 Eq. 110. See Flint v. Howard [1893], 2 Ch. 61.
[377] bugden v. bignold. Jwne 14, 21, 26, 29, 1843. [Considered, In re Mowers Trusts, 1869, L. E. 8 Eq. 110. See Flint v. Howard [1893], 2 Ch. 61.] A. being seised in fee of a freehold and copyhold estate, borrows various s.ums of money of B., amounting in the whole to 4000, upon mortgage of the freehold estate alone. A. afterwards in 1832 borrows 500 more of B., on the security of both the freehold and copyhold estate. This mortgage is effected by distinct instruments relating to each property respectively, neither of them referring to the other. In 1833 A. borrows a sum of 400 of ,C. on mortgage of the freehold estate alone, subject to B.'s incumbrances thereon. Again, in 1838, A. being indebted to D. in 600, executes to him a mortgage for that sum of the copyhold estate alone, without notice of the 500 incumbrance. In 1837 B. has notice of C.'s security, and in 1838 (after having sold both the estates under powers of sale, and received the purchase-money) he has notice of D.'s security. The produce of the freehold estate being insufficient to pay B. and C. in full, but that of the freehold and copyhold being sufficient for that purpose, C. claims to have the whole of the 500 charge thrown upon the produce of the copyhold estate, in order that he may receive payment out of that of the freehold; on the other hand, D. claims to be paid the whole of his debt out of the produce of the copyhold estate in priority to 0. Held, that the claim of neither party can prevail to the fullest extent; but that the 500 being by the security of 1832 charged on the freehold and copyhold estates, rateably (that is to say, in proportion to their respective net values), and without preference, C. has an equity of the nature claimed by him, to the extent of that proportion of the 500 which is charged upon the copyhold estate, while, in other respects, in relation to that estate, D. has priority over C. The court rolls of a manor are not constructive notice of prior incumbrances to a purchaser of copyholds holden of the manor. In and previously to the month of October 1830 Charles Milbank was seised in right of his wife (who was devisee in fee thereof under the will of her father, John Revett), of a certain freehold estate called the East Poole Marsh farm, situate in the parish of Great Stainbridge in the county of Essex, subject to a mortgage for a term of one thousand [378] years vested in Sir John Thorold for securing 1500 and interest, which mortgage was originally created by an indenture dated the 27th December 1796. Milbank was at the same time entitled tb the equity of redemption in fee of a copyhold estate holden of the manor of Pinginhoe in the county of Essex; that estate being mortgaged for 1500 to Benjamin G-ilson, to whom, as such mortgagee, the premises had been surrendered; the legal estate, however, being in one Bawtree. In October 1830 Milbank, through the medium of the Defendant, Bignold, who was secretary of the Norwich Union Society for the assurance of lives and survivorships, borrowed of that society 1500; and thereupon, by indentures of lease and release, dated the 3d and 4th October 1830, and made between Milbank and his wife 168 botjden; v. bigstoed 2.&c.e.c.m of the one part, and Bignold of the other part, the East Poole Marsh farm was Conveyed to Bignold and his heirs by way of mortgage for securing the .1500 so borrowed. By the deed of release a power of sale of the .mortgaged premises was given to the mortgagee. The Norwich Union, Society having at the time of this transaction paid off Sir John Thorold's mortgage, an indenture of assignment, bearing even date with the release of the 4th October 1830, was executed, whereby, in consideration of 1500 expressed to be paid to Thorold by the society, the freehold premises were assigned for the residue of the term of one thousand years to Patteson as a trustee for the society. In December 1830 a further sum of 1000 was borrowed by Milbank of the society; and thereupon Milbank and his wife executed to Bignold a deed of a further charge of the freehold premises, dated the 24th December 1830, endorsed on the indenture of release of the 4th October 1830, for securing as well that sum as the sum of 1500 which had been previously borrowed of the society. In April 1832 a further sum of 500 was borrowed by Milbank of the society, and thereupon another deed of fur-[379]-ther charge of the freehold premises, dated the 23d April 1832, endorsed in the same manner as the previous deed, was executed between the same parties, for securing as well that sum as the sums previously secured. As a further security for the repayment of the last-mentioned sum of 500, Milbank executed to Bignold an indenture, bearing even date with the preceding, whereby, after reciting the before-mentioned surrender to Gilson to secure 1500, and that Milbank had applied to Bignold to lend him the sum of 500, &c., it was witnessed that, in consideration of 500 expressed to have been paid by Bignold to Milbank, Milbank covenanted to surrender to Bignold, by way of mortgage, the copyhold estate, subject to Gilson's security. This indenture contained a power of sale. A conditional surrender of even date was duly made in pursuance of it. In April 1833 Milbank borrowed of Round & Co., bankers, of Colchester, a sum of 400; and by an indenture, dated the 13th of that month, and made between Milbank and wife of the one part, and Eound & Co. of the other part, reciting that the East Poole Marsh farm was charged by way of mortgage to Bignold with the principal sum of 4500 and interest, it was witnessed that, in consideration of 400 paid to Milbank by Round & Co., Milbank and wife did thereby direct and appoint that the said farm with its appurtenances should thenceforth stand charged with the payment of the said sum of 400 and interest, subject to Bignold's securities. In 1837 the Norwich Union Society first had notice of Round's security. In March 1838 the Norwich Union Society paid off Gilson, and by an indenture, dated the 6th of that month, took an assignment of his incunibrance with a covenant to surrender the copyhold premises. The copyholds were afterwards, in February 1840, surrendered to certain persons as trustees for the society. In July 1838, there being a large arrear of interest due [380] to the society on their mortgage securities, the East Poole Marsh farm was by their direction and by virtue of their power of sale put up for sale by auction, when it was purchased by Stephen Allen for 5000. This purchase was completed in November 1840. In September 1838 Milbank, being indebted to the Plaintiff in 600, agreed to execute to him a mortgage of the copyhold estate to secure the repayment of that sum. Accordingly, by an indenture, dated the 25th of that month, reciting that Milbank was seised in fee of the copyhold premises " subject to a certain conditional surrender made on or about the day of , 183 , whereby the said hereditaments were assured to the said Samuel Bignold, his heirs and assigns," for securing to him, his heirs and assigns, the repayment of 1500 and interest, theretofore advanced by him in discharge of a debt due to Benjamin Gilson on the security of the said premises, and reciting the debt due to the Plaintiff, Milbank covenanted to surrender the premises to the Plaintiff and his heirs, subject to a proviso for redemption of the premises oh payment by Milbank to the Plaintiff, his executors, &c., of 600 and interest as therein mentioned. On the day of the date of this indenture the copyhold estate was surrendered to the Plaintiff pursuant to the covenant. It did not appear that the Plaintiff had notice 2 Y. & C. C. C. 381. BUGD EN V B1GN O LD ] 6 9 at that time of the charge of the Norwich Union Society on the copyhold estate under the security of the 23d April 1832. In December 1838 Round & Co., having ascertained that after payment of the mortgages due to the Norwich Union Society, with arrears of interest and costs, the proceeds of the sale of the East Poole Marsh farm estate would not be sufficient to-satisfy them their mortgage, required the society to resort to the copyhold estate in satisfaction of so much of their mortgage debts as was charged on that estate, in order to enable them, Round & Co., to make their security available. Some discussion then ensued [381] between the parties as to the legality of this claim of Round & Co. Legal advice, however, being obtained in their favour, the copyhold estate was put up to sale by the society, arid was on the 23d July 1839 sold to Firmin for 2000. It did not appear whether, at this time, either Round & Co. or the Norwich Union Society had notice of the Plaintiff's security ; but on the 5th August 1840 the Plaintiff caused a written notice of that security, with a request to account, to be-served upon the Defendant, Bignold. Milbank afterwards took the benefit of the Insolvent Debtors Act, and W. S.. Cooper was appointed assignee of his estate and effects. The bill, filed in September 1840...
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