Your respondent, further answering, says that it has no knowledge, information or belief of the number of said bondholders, under said deeds of trust, that have made demand upon said complainants that they should execute their said trust; but respondent says that said Company is not and was not, at the commencement of this action, in default to one half of such interest; and, therefore, respondent says that said bondholders had no right to make such demand, and neither were the complainants nor respondent required to accede to such demands, by the terms of said trust-deed. And the said respondent, further answering, says that it has no means of knowledge of the per cent of the holders of said interest warrants that matured October first, 1873, that presented such warrants to the Company and demanded payment thereof; but respondent says, if it is true, as charged, that at least ninety per cent made such demand, at least eighty per cent of the entire number afterwards waived such payment, and consented to an extension thereof, as herein before stated, and that as to such eighty per cent said Company is in no default what ever. And as to the holders of said six hundred and ninety-eight of said bonds who did not fund their interest, the said respondent says, upon information and belief, and so charges, that a large majority thereof have consented to such default in the payment of said interest, and have assented to such extension; that many of the holders of such bonds have expressed to the officers of said Company their assent to such extension, and promised and agreed (but not in writing) that they would, in no manner, interfere with or by their adverse action defeat the plans of said Company for the extension of payment of said interest. And respondent further says, that it has no knowledge that any holder of said bonds ever elected to declare the principal due on account of a default of said Company, with the exception of the said Osgood, who only claimed to hold nine of said bonds. And as to the said Os good, the respondent says that, to the best of its knowledge and belief, the said Osgood never has, nor has anyone at his request, ever demanded of said Company or of any of its officers or agents, payment of any of the coupons attached to any of the nine bonds of which he claims to be the owner, and that the only notice the respondent has ever had that the said Osgood had so elected or that he demanded payment of either principal or interest, was derived from his said bill of complaint filed in said Circuit Court of Will County, as aforesaid, on said 22d day of February. And the said respondent further avers that on the 23d day of February, 1875, the said defendant offered and tendered the attorney of record of said Osgood, in open court, in said County of Will, full payment, principal and interest, of all the bonds held by the said Osgood, which was refused by said attorney. | And that respondent at the same time offered to deposit in court the full amount of said principal and interest, upon condition that said receivers should be discharged, and said property restored to said respondent, which offer was refused." On January 6, 1876, a petition was filed by Stephen Osgood, who had commenced the original proceeding in the state court on February 22, 1875, and seven others, claiming to be holders of bonds and coupons secured by the mortgages to Fosdick and Fish, in which they recite the previous proceedings in respect to the bill filed by the latter, and allege, among other things, that on October 1, 1873, the Railroad Company had made default in the payment of interest on its bonds, and that large numbers of coupons maturing on that day were presented at the office of the Corporation in the City of New York, payment thereof duly demanded and refused. It also rehearses the funding arrangements, and charging that they were based on false and fraudulent statements of the Company, the owners of the bonds, who funded their coupons on the faith thereof, are entitled to rescind the agreement and to enforce their claims against the Company. It alleges that Osgood had never funded his coupons. The petition also states that demand was also made at the office of said Corporation in New York in December, 1874, for the payment of sundry coupons due April 1, 1874, and which were never funded or agreed to be so, and that payment thereof was refused and the said presentment and non-payment was duly evidenced by a public instrument of protest by a notary public in and for said County and City of New York, and the said coupons still remain unpaid, and more than six months having expired since the demand of payment of said coupons in October, 1873, and the default thereon, and more than six months having also expired since the demand of payment of such coupons in December, 1874, and the default thereupon, your petitioners claim that by the conditions of said conveyances the said principal of all and singular the said bonds has also become due, and that there is now due and owing by the said corporation the full sum of $4,700,000 upon said first mortgage indebtedness. The petition prays for an account of the sums due on account of the said bonds and that the mortgaged property be sold to satisfy the same, etc. An answer was filed by R. Biddle Roberts, setting up his rights as trustee under the chattel mortgage; and Jas. W. Elwell also answers the amended bill, repeating substantially the allegations of his cross-bill. Fosdick and Fish filed an answer to the cross-bill of Elwell on March 10, 1876, and filed general replications to all the answers to their amended bill. Their answer to the cross-bill contains the following averments: "These respondents, further answering, upon information and belief, admit that certain holders of bonds under the deed of trust to these respondents have determined to demand and require of these respondents that they shall without delay declare the principal of all of said bonds presently due and payable, and will insist that these respondents proceed to prosecute their original bill in this behalf to speedy foreclosure and procure the sale of the property and franchises of said Railroad Company to satisfy said bonds. These respondents, further answering, say that they are also informed and believe and, therefore, charge the fact to be, that other holders of said bonds are in favor of and propose to demand that no such foreclosure and sale shall be had for the present, but what number of bondholders are in the one class or in the other these respondents are not advised and cannot state, but in that regard they say that they will endeavor to faithfully perform all their duties as trustees in this behalf and submit all such questions as may arise to the determination of this honorable court. Further answering, respondents say that they are not advised and cannot state, what precise number, the holders of past due coupons of bonds issued under the trust-deed to these respondents have presented for payment, but they allege that it is immaterial whether one or more of said coupons have been so presented; that, inasmuch as the said coupons have not been paid and a large amount thereof as herein before stated have long since become due and payable, and these respondents have been by some of the holders of said coupons called upon as trustees to foreclose the said mortgage, they are thereby vested with full authority to proceed to such foreclosure." An exhibit is filed with the amended bill, being a declaration, signed by Fosdick and Fish, as trustees, which, after reciting the issue of the bonds of March 10, 1869, and the mortgage given to them to secure the payment of the same, and the provision thereof, that the principal should become due, in case of the specified default in the payment of interest, continues as follows: "And whereas, default has been made by said Company in the payment of the half year's interest on all of said bonds which fell due on the first day of October, A. D. 1873. And whereas, the coupons for such interest have been presented and payment demanded; and whereas, such default has continued for more than six months after such demand; and whereas, the holders of said bonds have never consented thereto, and in consequence thereof the principal of all of the said bonds has become due and payable. Now, therefore, the said Chicago, Danville and Vincennes Railroad Company are hereby notified that we, William R. Fosdick and James D. Fish, as trustees as aforesaid, and under and by virtue of the provisions of said trust-deed and the authority conferred upon us thereby, do hereby declare the principal of all of said bonds to be due and payable." Service of this declaration and notice upon the Railroad Company is acknowledged to have been made February 26, 1875. Upon the issues thus made by the pleadings, an order of reference was made to a master to take testimony, and report the same with his findings, and a large amount of evidence taken before him is contained in the record. On June 24, 1876, the master filed his report. In it, he reported, among other findings, that, on October 1, 1873, the said Corporation did not pay any of the interest falling due on that day on the issue of bonds dated March 10, 1889, or upon the issue dated March 12, 1872; nor has the said Corporation paid any of the subsequent installments on any of said $4,000,000 bonds falling due at either of the following named days: April 1, 1874; October 1, 1874; April 1, 1875; October 1, 1875 and April 1, 1876; and that demand was duly made for the payment of divers of such coupons on October 1, 1873, and one of such coupons was protested for such non-payment more than six months prior to the institution of this action, or the written notice of such trustees declaring the principal of such bonds to be due and payable, and there is, consequently, now due to the divers holders of bonds dated March 10, 1869, the sum of $3,505,500. Thissum includes the principal of the bonds of the issue of March 10, 1869, the several coupons thereon of the dates mentioned, with interest to July 1, 1876, and the additional sum of $389,500, being 124 per cent premium on the nominal amount due for payment in gold, according to the stipulation in the bonds and mortgage to that effect. The master further reported that, as to all matters relating to the funding scheme, referred to in the pleadings, and the effect of the surrender of the funded coupons, and of the failure of the Company to pay the coupons due October 1, 1875, he was not required to examine or report upon and, therefore, made no finding, nor as to any allegations of fraud set up in the pleadings, no testimony having been taken before or submitted to him upon either matter. The Railroad Company filed exceptions to this report, of which the 6th is as follows: "For that whereas, the said master has decided, and in his said report stated, that on the 12th day of October, 1873, said Company did not pay any of its interest falling due on that day; that demand was duly made, and that one of said coupons was duly protested for such non-payment more than six months prior to the institution of this action, and to the date of the written notice of the trustees; and, therefore, the said master assumes, and so decides, that the principal and interest of all of said bonds has become due; when the fact is, as shown by the proof offered by the complainants and intervening petitioners, that no coupon was protested until the 19th day of December, A. D. 1874, less than three months prior to the date of said notice, and the commencement of this action, and there is no proof that there was ever any other demand upon said Company for the payment of said coupons." On the hearing, a decree was rendered, in which, among other findings it is declared: That the Railroad Company had paid all the coupons, on the bonds both on the Illinois and Indiana Divisions, which fell due April 1, 1873, and that none of the coupons which had matured since that date had been paid; That, under the two proposals of the Company for funding, there had been deposited coupons due October 1, 1873, to April 1, 1875, inclusive, on all the $2,500,000 of Illinois Division bonds, except $698,500 thereof, which coupons still remained in the hands of Fosdick, as trustee under the agreements; that the semiannual interest upon the convertible bonds and certificates of indebtedness, issued in exchange therefor, which fell due August 1, 1874, was paid in full and that the installment of interest thereon, which became due February 1, 1875, was duly paid by said Company upon all of the same which were presented for payment, which was the great bulk thereof, and that no interest has been paid on any part of the same since that time; That no payment of interest had been made upon the $698,500 of Illinois Division bonds, which had not been funded, since payment of the coupon due April 1, 1873. The decree then recites as follows: "That heretofore, and on the 26th day of February, A. D. 1875, the said complainants, as trustees under the said mortgage or trust-deed to them, dated March 10, 1869, did declare the principal of the said twenty-five hundred Illinois Division bonds to be due and payable by reason of the default of said Railroad Company in the payment of certain of the coupons of said bonds which fell due October 1st, 1873, payment of which had been duly demanded, and the continuance of such default for more than six months after such demand." The decree then proceeds to declare that there is due and owing from the Railroad Company to the complainants, as trustees under the mortgage deed of March 10, 1869, the several sums of $87,500 in gold coin, for the coupons on the $2,500,000 of bonds secured thereby, falling due respectively semi-annually from October 1, 1873, to October 1, 1876, inclusive, less the payments made on account of the four coupons on the convertible bonds and certificates of indebtedness, with interest on said sums at the rate of 6 per cent per annum and, as the decree reads: "In the further sum of two million five hundred thousand dollars in gold coin, for the principal of the said Illinois Division bonds so declared to be due as aforesaid, together with interest thereon from and after the first day of October, A. D. 1876, at the rate of seven per cent per annum in gold." be a perpetual bar, in law and equity, against every claim of the Railroad Company, or other person claiming under it. Under this decree, a sale was had and reported to the court, and confirmed by a subsequent decree, of the mortgaged property to F. W. Huidekoper, T. W. Shannon and J. M. Denison for $1,450,000, and the purchase money having been paid, $362,500 in cash and by the surrender of $2,328,000 of the Illinois Division bonds, with the coupons and certificates of indebtedness or convertible bonds thereto attached and belonging, a conveyance of the title to the mortgaged property was made to the purchasers. It is assigned for error upon the decree of foreclosure and sale: First. That the court below required from the mortgagor, payment of the principal of the debt secured by the mortgage, as then due, and on non-payment thereof, within twenty days, that the mortgaged property should be sold; and, Second. That it decreed foreclosure and sale on this condition, without proof of the written request of the holders of the majority of the bonds. It is undeniable that at the date of the filing of the bill which was February 27, 1875, the defendant, the Chicago, Danville and Vincennes Railroad Company, was in default for non-payment of the coupons on $698,500 of the issue of $2,500,000 of the Illinois Division bonds, which matured October 1, 1873. The holders of that amount of these bonds did not fund their coupons and none of them were paid. This failure on the part of the mortgagor constituted a breach of one of the conditions of the mortgage; and continuing for six months, entitled the trustees under the fifth article to take possession of the mortgaged premises, on being It was then" Ordered, adjudged and decreed so required by the holders of not less than one that the said defendant, the Chicago, Danville half the outstanding bonds, and collect the net and Vincennes Railroad Company pay, or cause income, until the default should have been satto be paid, to the said complainants as trustees, isfied; or, to sell the mortgaged premises under for the holders of the said Illinois Division the power conferred by the sixth article of the bonds and coupons, the said several sums of conditions. In the latter event, the mortgaged money, with interest thereon, as hereinbefore premises would have to be sold as an entirety, found to be due and owing, within twenty (20) free from the incumbrance of the mortgage, days from and after the entry of this decree, and the proceeds of the sale would be applied, and in default thereof, that all of the said first, to the payment of the amount due and in railroad, premises, property and franchises de- arrears, and then to the mortgage debt, not scribed in the said trust-deed, dated March 10, then due, and any surplus to the mortgagor. A. D. 1869, and hereinbefore described as the But, inasmuch as by the terms of the first artiIllinois Division of said railroad, etc., and all cle the conveyance is declared to be for the purthe right, title, interest and equity of redemp- pose of securing the payment of the interest as tion of the said Chicago, Danville and Vin- well as the principal of the bonds, and by the cennes Railroad Company therein, shall be sold fourth article, the mortgagor's right of possesas an entirety by Henry W. Bishop, the master sion terminates upon a default in the payment in chancery of this court, at public auction to the of interest as well as principal, on any of the highest and best bidder for cash therefor, pay- bonds, we are of opinion, independent of the able as hereinafter provided, at the west door provisions of the other articles, that the trustof the Republic Life Insurance Company Build-ees, or on their failure to do so, any bondholder, ing, in the City of Chicago, in the State of Illinois, after having first given notice of the time and place and terms of sale, and a description of the property to be sold, by advertisement thereof in some public newspaper published in the City of Chicago, for the space of thirty (30) days prior to such day of sale." The decree also contains the usual declaration that a conveyance of the title to the property sold, after confirmation of the sale, should on non-payment of any installment of interest on any bond, might file a bill for the enforcement of the security, by a foreclosure of the mortgage and sale of the mortgaged property. This right belongs to each bondholder separately, and its exercise is not dependent upon the co-operation or consent of any others, or of the trustees. It is properly and strictly enforceable by and in the name of the latter, but, if necessary, may be prosecuted without and Where, according to the English practice, a sale instead of foreclosure was ordered, the form of the decree was the same, directing the sale, in the event of a default being made in payment of the amount found due, within the usual time of six months, or within a shorter period, or even immediately, if by consent, or where it was considered to be for the benefit of all parties. 2 Dan. Ch. Pr., 1266. even against them. It follows, from the nature | the mortgage debt, whether on a bill to redeem of the security, and arises upon its face, unless or to foreclose, was six months. But that was restrained by its terms. And in case the pro- not regarded as an absolutely fixed period, but ceeding results finally in a sale of the mortgaged might be varied so as to be reasonable, accordpremises, the sale is made free from the equity ing to the discretion of the court and the parof redemption of the mortgagor, and all hold- ticular circumstances of the case. The courts, ers of junior incumbrances, if made parties to however, were very liberal in cases of foreclosthe suit, and is of the whole premises, when ure, in extending and enlarging, from time to necessary to the payment of the amount due, time, this period of redemption, though not in or when the property is not properly divisible; cases of bills to redeem, where the mortgagor it conveys a clear and absolute title, as against came into court professing his readiness to pay all parties to the suit or their privies, and the the amount due, when ascertained, nor in cases proceeds of the sale are distributed, after pay- of sales, where the mortgagor was not subjected ment of the amount due, for non-payment of to the severe and absolute forfeiture of his right. which the sale was ordered, in satisfaction of the Perine v. Dunn, 4 Johns. Ch., 140; Harkins v. unpaid debtremaining, whether due ornot. Olcott Forsyth, 11 Leigh, 294. v. Bynum, 17 Wall., 63 [84 U. S., XXI., 575]; Burrows v. Malloy, 2 Jones & L., 526. This doctrine is stated by this court in Howell v. R.R. Co., 94 U. S., 466 [Howell v. McAden, XXIV., 256], where an authoritative rule of practice in such cases is prescribed. "We are of opinion, then," say the court, speaking by Mr. Justice Miller, "that there is due from the Railroad Company to plaintiff the amount of his overdue and unpaid coupons. For this sum, whatever it In the early practice in Kentucky, the premay be, he has a right to a decree nisi, accord- liminary decree finding the amount due and ing to the chancery practice; a decree which giving day for payment, was interlocutory merewill ascertain the sum so due and give the com-ly and separate from the subsequent decree, findpany a reasonable time to pay it, say ninety days or six months, or until the next Term of the court, in the discretion of that court. If this sum is not paid, the court must then order a sale of the mortgaged property, with a foreclosure of all rights subordinate to the mortgage, with directions to bring the purchase money into court. If the case proceeds thus far, the plaintiff will have a lien on the money thus paid into court, not only for his overdue coupons, but for his principal debt, and it must be provided for in the order distributing the proceeds of the sale. If, however, the company shall pay the sum found due in the decree nisi, no further proceeding can be had until another default of interest or of the principal." The decree nisi, mentioned in this extract, like that in suits against infants, in which a day is given to the infant to show cause against it, after he attains full age, and that, where the bill is ordered to be taken pro confesso, is preliminary in its nature, requiring a further order to complete it. According to the practice of the English chancery, decrees of this nature in foreclosure suits, after directing an account to be taken of the principal and interest due to the plaintiff upon the mortgage, ordered, that upon the defendant's paying to the plaintiff the amount ascertained and certified or found to be due, within six months, at such time and place as were appointed, the plaintiff should reconvey the mortgaged premises; but that in default of such payment, the defendant should thenceforth be absolutely debarred and foreclosed of his equity of redemption. It was necessary, however, for the plaintiff, in order to complete his title, to procure a final order confirming it; otherwise the decree of foreclosure would not be pleadable. This order of confirmation he procured on proof to the court of non-payment according to the terms of the decree. 2 Dan. Ch. Pr., 997. The time usually allowed by the decree to pay ing the default in not performing the former decree and directing a sale in consequence thereof. Downing v. Palmateer, 1 Mon., 64; Oldham v. Halley, 2 J. J. Marsh, 113; Hanks v. Greenwade, 5 J. J. Marsh, 250; Champlin v. Foster, 7 B. Mon., 104. The ground of this practice seems to have been, that the mortgagor had the right to have the record show that he had failed to pay according to the decree nisi before a sale of his property was ordered. But there seems to us to be no sufficient reason why, as it was according to the English practice, and generally in this country, all these matters may not be embraced in a single decree. What is indispensable in such a decree is, that there should be declared the fact, nature and extent of the default which constituted the breach of the condition of the mortgage, and which justified the complainant in filing his bill to foreclose it, and the amount due on account thereof, which, with any further sums subsequently accruing and having become due, according to the terms of the security, the mortgagor is required to pay, within a reasonable time, to be fixed by the court, and which, if not paid, a sale of the mortgaged premises is directed. Woodard v. Fitzpatrick, 2 B. Mon., 62. This is that final decree of foreclosure and sale, which determines and fixes the rights of the parties, and from which, on that account, an appeal lies. Ray v. Law, 3 Cranch, 179; Whiting v. Bank, 13 Pet., 15; Forgay v. Conrad,6 How., 204; R. R. Co. v. Swasey, 23 Wall., 409 [90 U. S., XXIII., 137]. But as in cases of strict foreclosure, so in case of sale; the equity of the mortgagor as against the mortgagee is not exhausted until sale actually confirmed; for if at any time prior he should bring into court, for the mortgagee, the amount of the debt, interest and costs, he will be allowed to redeem. It is the deed made to the purchaser, actually transferring the title of the parties to the suit, that terminates the mortgagor's equity of re-ber 20, 1873, the four corresponding coupons on demption. Brine v. Ins. Co., 96 U. S., 632 $1,530,000 of the bonds were deposited and ex[XXIV., 860]. changed for certificates of indebtedness. It is obvious that the finding of the amount due, for non-payment of which, according to the terms of the decree, the mortgaged property is ordered to be sold, is the foundation of the right of the mortgagee further to proceed, and a substantial error in that finding must, on appeal, vitiate all subsequent proceedings. Unlike a calculable error in the amount of a personal judgment which may be cured by a remittitur, It is otherwise incurable; for, as it is an illegal exaction, made as a condition for preserving the rights of the mortgagor in his estate and, if executed, depriving him wrongfully of them, it propagates itself through all subsequent stages of the cause. The right to redeem is a favorite equity, and will not be taken away, except upon a strict compliance with the steps necessary to divest it. Bigler v. Waller, 14 Wall., 297 [81 U. S., XX., 891]; Shillaber v. Robinson, 97 U. S., 68 [XXIV., 967]. In Clark v. Reyburn, 8 Wall., 318 [75 U. S., XIX., 354], a decree of strict foreclosure, which contained no finding, either of the fact or amount of the alleged indebtedness, and gave no time within which to pay or redeem, was reversed on these grounds, although the bill was taken pro confesso as to the parties having the entire beneficial interest, and contained an averment of the precise amount of the mortgage debt then due. The same consequences, undoubtedly, would have followed, if it had been a decree of foreclosure and sale, instead of a strict foreclosure; and the error is as vital, where a larger amount than is actually due is ordered to be paid, as where there is a failure to find what amount is due. It becomes, then, of the first importance to ascertain whether the decree of foreclosure and sale, in the present case, found due and required to be paid, as the condition of exercising the right to redeem, a larger sum than was then due. The errors alleged in the amount are two. The first is, that there was declared to be payable $252,220, the amount of the several coupons, maturing from October 1, 1873, to April 1, 1875, both inclusive, the payment of which, it is claimed, as to all the bonds of the Illinois Division, except $698,500 thereof, had been, by the funding agreements, extended until February 1, 1879. The second is, that the principal sum of $2,500,000 of these bonds, contrary to the agreement between the parties, was also declared to be due and payable. The appellants insist that the only indebtedness of the Railroad Company to the bondholders, represented by the complainants at the time of the filing of their bill, was the past due interest on 699 bonds, the interest warrants of which had not been funded, amounting to about the sum of $147,000. It appears from a statement in the record,admitted to be correct, that there had been deposited and exchanged for convertible bonds the four coupons maturing on and from October 1, 1873, to April 1, 1875, on $271,500 of the Illinois Division bonds, and that by the terms of the agreement under which that exchange was effected, dated November 11, 1873, it was not to be binding unless assented to in writing by a majority in interest of the bondholders. In point of fact, such majority did not assent to it; but under the second proposition, dated Novem It appears further, that the Railroad Company paid the accruing interest on the convertible bondsand certificates of indebtedness, issued under these arrangements, which became due prior to the filing of the bill, except $3,167.77, which was not presented. The default in respect to the coupons surrendered was, by the terms of the funding agreements, waived as long as the interest upon the securities substituted for them was punctually paid, so that at the date of the filing of the bill there was no subsisting default in the payment of interest, except upon the $698,500 of bonds which had not been funded. The master finds, and his report in that respect is the predicate of the decree, that divers coupons falling due October 1, 1873, were presented on that day, and that payment thereof was demanded and refused; and that one of such coupons was protested for such non-payment more than six months prior to the institution of the suit and the written declaration of the trustees, that the principal of the bonds had thereby become due. There are some statements in the answers, and in the testimony of some of the witnesses, that coupons due October 1, 1873, were presented for payment and were not paid; but there is no proof of the fact as to any particular coupon identified for that purpose, and we have carefully searched the record in vain for any evidence whatever that any coupon, not afterwards funded, was presented and payment thereof refused. The master himself does not report any such. It is entirely consistent with his finding, and with the evidence on which it professes to be founded, that the payment of every coupon falling due October 1, 1873, presented for payment on or after that day, and payment whereof was refused, was extended by the subsequent agreements to fund them. The intervening petition of Osgood and others, if it be considered as a pleading whereby they were allowed to become co-complainants, does not allege that any one of the coupons held by them was presented for payment. It is averred that large numbers of the coupons maturing on October 1, 1873, were presented and payment thereof was demanded and refused on that day, but the allegation that any such coupon was held by either of the petitioners seems to have been studiously avoided; and stress is laid on averments of fraudulent misrepresentations which induced bondholders to fund their coupons, in support of which the master reported that no testimony was offered, and upon the insolvency of the Company, which is entirely immaterial upon the question of an actual default. It is averred in the petition that coupons were presented and payment demanded in December, 1874, which had become due the previous April, and the master so reports as to one; but the only evidence that appears in the record is an admission of the Railroad Company in its sixth exception to the master's report, where it is accompanied by the statement that such demand and refusal was less than six months before the filing of the bill, and could not, therefore, have been the foundation of the declaration that the principal of the mortgage debt had |