Sturgis v Morse
| Jurisdiction | England & Wales |
| Judgment Date | 18 July 1860 |
| Date | 18 July 1860 |
| Court | High Court of Chancery |
English Reports Citation: 44 E.R. 1169
BEFORE THE LORDS JUSTICES.
S. C. 24 Beav. 541. For subsequent proceedings, see 28 Beav. 398; 2 De G. F. & J. 223.
Reports of CASES HEAED and DETERMINED by the LORD CHANCELLOR and the COURT OF APPEAL IN CHANCERY. 1858-59. By J. P. DE GEX and H. CADMAN JONES, Esqrs., Barristers-at-Law. 1860. Vol. III. [1] sturgis v. morse. Before the Lords Justices. June 24, 1858. [S. C. 24 Beav. 541. For subsequent proceedings, see 28 Beav. 398 ; 2 De G. F. & J. 223.] A cestui que trust of real estate under a will was discharged in 1825, under the Insolvent Act, but omitted the estate from his schedule. In 1831 he became bankrupt, and his assignee in bankruptcy took a conveyance of the legal estate from the trustee in trust for the creditors under the bankruptcy. Held, that it thereby became vested in him upon an express trust, viz., that declared by the will, the benefit of which belonged to the creditors under the insolvency, and that on a bill being filed by the assignee in insolvency in 1853, the Statute of Limitations afforded no defence to the recovery of the estate or the mesne profits. It appearing that the assignee in bankruptcy had entered into the receipt of the rents with notice of the insolvency, and had acted in defiance of the title under it: Held, not a case for limiting the time from which the account was to be taken. This was an appeal from the decision of the Master of the Eolls, reported in the 24th Volume of Mr. Beavan's Reports (page 541), declaring that the Plaintiff, as assignee under the insolvency of Thomas George Coningham, was entitled to certain freehold and copyhold property in priority to the assignees, under a subsequent bankruptcy of the insolvent. The principal questions on the appeal, as well as below, were, whether the Statute of Limitations was a sufficient answer to the suit, and if not, from what time [2] the account of the rents and profits ought to be directed. The insolvent's title to the property in question was derived from the will of his grandfather, Thomas Coningham, dated the 27th of February 1783, whereby the testator devised, among other property, that in question unto and to the use of two trustees named Thomas Vine and James Hogg, their heirs and assigns, upon trust to permit his son, Thomas Coningham (the insolvent's father), to receive the rents and profits for his life, and after his decease then upon trust for his children, as tenants in common in tail, with cross-remainders. In the events which happened the insolvent and his two siaters, Ann Eliza Gibbons and Elizabeth Adam, became, during his father's lifetime, the only children entitled under the devise in remainder. By an indenture dated the 30th of June 1813 the insolvent mortgaged his estate in remainder to Messrs. Smith and Currie. His insolvency took place in 1825, when, by the then usual assignment, all his estate and effects were assigned to the provisional assignee of the Insolvent Court. His schedule, however, did not in any manner mention or refer to the property comprised in the will, but expressly stated 1170 STUEGIS V. MORSE SDBG.&J.3. that the insolvent had no interest in any freehold, copyhold or leasehold estate, either in possession or in expectancy. Shortly after the insolvency the tenant for life died, and the insolvent was permitted by the then trustee of the will to receive the rents and profits of a part of the property, and he mortgaged his estate under the will to a creditor named Pidgeon, one of the Defendants. [3] In 1832 the insolvent was declared bankrupt, and the Appellant Louth Morse, who was appointed the creditors' assignee under the bankruptcy, became aware of the bankrupt's previous insolvency by an examination of the bankrupt on the 1st of March 1832. On the 12th of February 1834 the Appellant purchased for his own benefit the shares of the bankrupt's sisters in the property, which were conveyed to him by a disentailing deed of that date. Soon afterwards the Appellant entered into an agreement for compromising a suit which had been instituted by the sisters for carrying into effect the trusts of the will, and in which a receiver had been appointed, and by an order made in this suit on the 10th of March 1834, on the petition of the heir of the last surviving trustee under the will, the insolvent and Mr. Pidgeon, the mortgagee, and by the consent of the Appellant and other parties, not including, however, the assignee under the insolvency, no mention of which was made in the petition, the compromise was ordered to be carried into effect and the receiver was ordered to be discharged. On the 1st of August 1834 a disentailing deed and deed of partition was executed of that date, grounded on the then usual lease for a year, and made between James Lewis Hogg (the only son and heir at law of Thomas Hogg, the eldest brother and heir at law and customary heir of James Hogg, the surviving trustee under Thomas Coningham's will) of the first part, Mr. Pidgeon, the mortgagee, of the second part, the Commissioner acting under the bankruptcy of the third part, the official assignee and the Appellant as assignees under the bankruptcy of the fourth part, the bankrupt of the fifth part, an incumbraiicer named John Tebbut of the sixth part, [4] the Appellant in his own right, as the owner of two-third parts of the property, of the seventh part, and other parties, whereby certain freehold and copyhold hereditaments described in the first schedule to the deed were assured in severalty, in lieu of the bankrupt's undivided third part, to the use of the official assignee George Gibson and the Appellant, their heirs and assigns, subject to Mr. Pidgeon's mortgage, upon trust for sale and division of the proceeds among the creditors of the bankrupt who had sought or should thereafter in due time come in and seek relief under the commission. Upon the execution of these deeds, the Appellant entered into the receipt of the rents and profits of the property thus conveyed to the assignees, they being unable to dispose of it by reason of the insolvency. For the purpose of making a compromise with the creditors claiming under the insolvency, the appointment of a creditors' assignee under the insolvency was obtained, but no arrangement was agreed upon. In the meantime the London and Blackwell Eailway Company required for their undertaking a portion of the land, and difficulties having arisen in making a title by reason of the insolvency, it was arranged, that the title should be made under the above-mentioned mortgage of June 30th, 1813. This mortgage, on which 500 remained due, had in the meantime become vested in two of the Defendants named Ling and Lucas, who had purchased the mortgage debt for 150, and had offered to the Appellant to transfer their interest in it, either to the company or to the assignees on being repaid their outlay and expenses, amounting altogether to 224, 2s. 4d.; and it was alleged on the part of the Plaintiff, that Messrs. Ling and Lucas had, in fact, taken the transfer by arrangement with the Appellant, and for the benefit [5] of the estate. By the conveyance to the company, Messrs. Ling and Lucas, in consideration of 300 (the purchase-money) therein expressed to have been paid to them by the company, at the request of Mr. Pidgeon, of certain trustees claiming under him, and of the Appellant, conveyed the land comprised in the conveyance to the company. The insolvency was not referred to in the conveyance; a bond of indemnity, however, against any claim under it was at the same time taken by the company. The Defendants Ling and Lucas retained the purchase-money, and disputes 3DEO.&J.6. STUBGIS V. MORSE 1171 afterwards arose between them and the Appellant as to their right to retain out of the 300 some subsequent and additional allowances over and above the 224, 2s. 4d., in respect of the indemnity to the company and otherwise. The creditors' assignee under the insolvency died before any arrangement was come to, and soon after his death an assignment was taken of his debt. On the 8th of November 1850 application was made on behalf of the purchaser of the debt to the provisional assignee of the Insolvent Debtors Court to intervene in the matter, and come to some compromise of the claims under the bankruptcy and insolvency. The result of the application was an investigation into the circumstances of the case, and, subsequently, the institution of the present suit on the 21st of January 1853. Before the bill was filed the Plaintiff gave notice to the tenants to pay their rents in future to him, and in consequence of this notice one of the tenants refused to pay his rent any longer to the Appellant, who then distrained, and upon the distress being replevied brought [6] an action of replevin against the tenant and his sureties. lathe course of these proceedings the Appellant supported_his claim in the action by the production of the above-mentioned mortgage of the 30th of June 1813, and the transfer of it to the Defendants Ling and Lucas. The latter, on the 14th of August 1852, gave the Appellant a written authority to manage the property in their names, and receive the rents. The Appellant had since the date of this authority continued in the receipt of the rents and profits. The bill alleged that the authority from the Defendants Ling and Lucas was merely colourable, they having long ceased to have any other right or interest under the securities than as trustees for the parties who might be ultimately declared beneficially entitled to the property comprised in it. The prayer was, that it might be declared that the Plaintiff was entitled to the share and interest of the insolvent in the freehold and copyhold hereditaments and premises devised by the will of Thomas Coningham, the testator, in priority to Mr. Pidgeon and two other Defendants named Samuel Jenkins and Benjamin Smith, and the Appellant and William Pennell, as assignees of...
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