Chancellor for further relief upon this petition in Trinity Term next, and that in the mean time the said Walter Blackmore do have the management and control of his business and estate without the interference or control of the committee of his person and estate, and that in the mean time also any of *87 the persons interested be at liberty to apply to us or to the Lord Chancellor as they may be advised." * THE LORD JUSTICE KNIGHT BRUCE. After much reflection, my conclusion is the same. 1863. June 5. Upon an application now made accordingly by Walter Blackmore the commission was superseded. GLEAVES v. PAINE. 1863. January 15. Before the Lord Chancellor Lord WESTBURY. A husband and wife mortgaged in fee land of which they were seised in right of the wife, to whom the equity of redemption was reserved by the mortgage deed. The husband became bankrupt, and in the suit by the wife for a settlement of the equity of redemption on her and her children, and for redemption as against the mortgagee and for foreclosure against the assignees and the husband, the assignees disclaimed. Held, that the wife was entitled to redeem as against the mortgagee, and to have the whole fee settled upon herself and her children, the husband not objecting. Form of decree in such a case. Sturgis v. Champneys (5 Myl. & Cr. 97) not to be extended. THIS was an appeal from a decree of the Master of the Rolls, directing a settlement of an equity of redemption upon the plaintiff Ann Gleaves, the wife of the defendant William Gleaves. The bill, to which William Paine and Joseph Lenton the husband's assignees, Thomas Pyke the mortgagee * and the * 88 husband were defendants, stated, in substance, as follows: By an indenture, dated the 25th of September, 1857, made between William Gleaves and Ann his wife of the one part and Thomas Pyke of the other part, duly acknowledged by Ann Gleaves, the land in question in the cause, of which William and Ann Gleaves were seised in fee-simple in right of Ann, was, in consideration of 7001. advanced to the husband, assured to the use of Thomas Pyke, his heirs and assigns, subject to a proviso, that on payment by William Gleaves, his heirs, executors or administrators, or the person or persons beneficially entitled to the equity of redemption of the mortgaged premises, to Thomas Pyke, his executors, administrators, or assigns, of the sum of 7007., with interest, at the time therein mentioned, Thomas Pyke, his heirs or assigns, would, at the request and costs of William Gleaves, his heirs or assigns, reassure the premises free from encumbrances to the use of Ann Gleaves, her heirs and assigns; and the deed contained a covenant by William Gleaves for payment of the mortgage-money and interest. Default was made in payment on the day named in the deed, and afterwards, on the 25th of February, 1862, William Gleaves was adjudicated bankrupt. The defendants William Paine and Joseph Lenton were his assignees. There were issue of the marriage seven children, who were all living; and no settlement or agreement for a settlement of any property whatsoever had been made upon or since the marriage; but William Gleaves had since the marriage received other property in right of his wife, to a considerable amount. The bill stated that the whole of the 7001. was received by William Gleaves, and applied by him to his own purposes; that the plaintiff had no property or means of support whatever for her*89 self and her children except the mortgaged property, and that the value of such property free from encumbrances was not more than 8007. * The bill further alleged, that the plaintiff concurred in the mortgage and in the conveyance of her property thereby made as a surety only, and charged that the estate in bankruptcy of her husband was primarily liable to pay the mortgage debt in exoneration of the plaintiff's property, and that she was entitled to have the mortgaged property, or the equity of redemption thereof, settled upon her, or a proper provision made out of the same for her maintenance and support. There was a further allegation that the assignees refused to permit the mortgagee to prove against the bankrupt's estate for the moneys due upon the mortgage without the mortgagee first realizing or giving up for the benefit of the bankrupt's estate the estate and interest of the bankrupt in the mortgaged property. There was also a charge that the estate and interest of the bankrupt in the mortgaged property ought to be settled for the plaintiff's benefit. * The prayer was for a declaration that the mortgage debt of 7001. and the interest thereof and all other moneys payable in respect of the same had been and were the debt of the bankrupt, and that the security effected by the mortgage upon the plaintiff's property was only a surety for such debt, and that the said property ought to be exonerated from such charge out of the bankrupt's estate other than his interest in the mortgaged property; and that such last-mentioned interest, or, at least, the equity of redemption thereof, ought to be settled for the benefit of the plaintiff. It also sought a direction that the mortgagee should prove under the bankruptcy for what was due to him in *90 respect of his mortgage; and might (if necessary for the purpose of such proof) give up and relinquish the estate and interest of the bankrupt in the mortgaged property, and might do all other necessary acts for the purpose of enabling himself to prove and recover a dividend against the bankrupt's estate, the plaintiff offering to indemnify the mortgagee against all loss or damage which might be thereby occasioned. It also sought a settlement upon the plaintiff of the mortgaged property, or the estate and interest therein, which the bankrupt acquired by his marriage with the plaintiff, or, at least, the equity of redemption of such property or of such estate therein, subject to the mortgage debt or to such part thereof as should not be discharged, out of the bankrupt's estate. It also sought liberty (if necessary) for the plaintiff to redeem the mortgage, and for a reconveyance in that case of the mortgaged property to her or for her separate use on payment of so much of the mortgage debt as the dividends in respect thereof to be received from the bankrupt's estate should not suffice to pay, or otherwise, upon payment of the whole of the mortgage debt, with such rights and remedies over against the bankrupt's estate as the Court might think fit to direct. The cause came on for hearing before his Honor the Master of the Rolls on the 7th of August, 1862, on motion for decree, when it was ordered that the next friend of the plaintiff should pay to the assignees their costs of suit, and that the estate and interests of the bankrupt in the mortgaged premises should be settled upon trusts for the plaintiff, for her separate use, during her life, with remainder to her children as she should appoint, and in default of appointment equally; and in case the plaintiff should die without leaving any child, in trust for the plaintiff and her heirs. absolutely. * 91 *The assignees appealed from the whole decree. Mr. Cole and Mr. Kay, for the respondent, the plaintiff below. -The decree of the Master of the Rolls is in accordance with the authorities, which extend to the case of estates in land: Sturgis v. Champneys, (a) Hanson v. Keating; (b) and the equity which it recognizes is one which can be enforced by the wife as plaintiff: Lady Elibank v. Montolieu, (c) Wortham v. Pemberton. (d) Besides which, the cases of The Earl of Kinnoul v. Money, (e) and Aguilar v. Aguilar, (g) show that in such a case as this the relation of the husband and wife is that of principal and surety for the husband's debt, and that the estate of the husband must be first applied in exoneration of that of the wife. The assignees are not entitled to require the mortgagor to give up his security before he proves his debt in bankruptcy. It is, on the contrary, incumbent on him to recover what he can from the bankrupt's estate, before he resorts to the property of the wife. Ex parte Hedderly. (h) Mr. Selwyn and Mr. E. F. Smith, for the appellants. — A wife as against her husband's assignee for value, who becomes so at a time when the husband is able and willing to fulfil his moral obligation of maintaining her, has no equity to a settlement out of her husband's interest in her estate in lands. Hill v. Ed monds, (i) Tidd v. Lister, (k) Durham v. Crackles. (1) In *92 the * present case the husband's interest in his wife's estate is an interest for life by the curtesy; but had there been no issue, he would still have taken a freehold interest during the joint lives of himself and his wife. Robertson v. Norris. (m) That interest would have passed by the mortgage deed, even if it (a) 5 Myl. & Cr. 97. (c) 5 Ves. 737. (d) 1 De G. & Sm. 644. (h) 2 Mont., D. & De G. 487. had not been executed and acknowledged by the wife: Robertson v. Norris; (a) and the execution of such deed by him would, so far as it affected his own interest in the property, have been simply the exercise of a legal right, not conferring on the wife any equity to a settlement: Warden v. Jones. (b) We do not however desire to redeem, as the life-interest of the bankrupt would be worth less than the amount of the mortgage money. With regard to the mortgagee's right to prove without giving up his security, or having the value of it ascertained by a sale, the Court of Bankruptcy has indeed a discretion to relax its ordinary rule and to order a valuation, but it is a discretion which should be exercised with great caution and only under special circumstances. Ex parte Smith. (c) The mortgage ought to be realized. Mr. John Rigby, for the husband and the mortgagee. Mr. Cole, in reply. No relief is sought by the bill against the mortgagee, and therefore the cases cited against us, and which are cases of a particular assignee, as opposed to assignees in bankruptcy or insolvency, do not apply. * * [The Lord Chancellor during the arguments observed that in Sturgis v. Champneys a new law was introduced by Lord. COTTENHAM. That, according to the previously existing 93 law, where the assignees of the husband came to this Court for the purpose of obtaining the property of the wife, the Court had taken upon itself to say that they should not recover such property without making a reasonable provision for the performance of the moral obligation of the husband to maintain the wife. That Lady Elibank's Case had gone to this further extent, that where it was perfectly clear that the subject-matter in controversy must be determined and decided upon and distributed in this Court, there the wife might come to assert the equity, and need not wait until the defendant came to the Court to seek its interference. But that here the higher inquiry still remained, whether a Court of Equity was not bound with respect to land to follow the law, or whether it was at liberty to set up its own peculiar rule in order to defeat that which, but for the legal estate being outstanding, would (c) 2 Rose, 63; 1 V. & B. 518. (a) 11 Q. B. (N. S.) 916. |