to the paper and heard; but the defendant objecting to this, the Vice-Chancellor refused to interfere. The plaintiff, under these circumstances, now appealed to the Lord Chancellor. [On opening the case, some discussion took place as to whether it could be properly treated as an appeal, and whether an application for a rehearing ought not to be made to the Vice-Chancellor. THE LORD CHANCELLOR was clearly of opinion that such was the right course for the plaintiff to pursue; but said that if the defendant did not object, he would, with the view of saving delay and expense to the parties, allow the present hearing to proceed; adding, however, that it must not be drawn into a precedent.] Mr. C. P. Cooper, Mr. Bilton, and Mr. Joseph Brown, for the appeal. They contended that the taking of the promissory note had discharged the surety, either as changing the security altogether, or as giving time to the principal debtor; that so far as the finding of the Master negatived this conclusion, it was wrong; that the only evidence in support of the defendant's case was that of her own solicitor, and that this ought not to be taken as against the plaintiff; that any reservation of the creditor's right against a surety on a giving of time to the principal debtor must be clear and express, and must also appear on the face of the *414 document giving the time. They cited Stone v. Compton, (a) Lewis v. Jones, (b) Ex parte Glendinning, (c) Byles on Bills, p. 186, ed. 5. Mr. Wigram, Mr. Bovill, and Mr. Pearson, for the defendant. They submitted that the sole question was what was the intent with which the promissory note was given, and that to make it a discharge of the surety it was necessary to prove that such was its intent, by showing either that it was to supersede the bond or to suspend the remedy on the bond; and that the report of the Master negatived entirely the plaintiff's case. They referred to Pring v. Clarkson. (d) Mr. Brown, in reply. THE LORD CHANCELLOR. - In this case the plaintiff entered into (a) 5 Bing. N. C. 142, see p. 156. (c) Buck, 517. a bond as surety for 400l., of which 1201. have been paid, and 2807. remain due. A promissory note was given by the principal debtor to the creditor for the latter sum, payable at two months. The effect of this transaction at law was in no manner to impeach the bond; but the question might arise whether the promissory note did not of necessity, in the absence of any agreement being proved to the contrary, operate as a discharge of the surety; that is to say, whether it was simply a collateral security, or whether it was not a security which gave time to the principal debtor. * 415 All the cases prove that, where an instrument is * taken which might otherwise operate as a discharge of the surety, there will be no discharge if the remedies against the surety are preserved. In the present case an action was brought on the bond, to which the defendant, the plaintiff here, had no defence; he therefore comes to equity for relief. This Court, however, cannot interfere against a legal obligation, unless an equitable case is made out; and it must therefore be shown that the transaction in question released the plaintiff from the obligation. No such case has been attempted to be made out, and I give no opinion upon it; because it is perfectly clear in law that an agreement, that a transaction which would of itself operate to release the surety shall not have that effect, may be proved by parol evidence. It was said at one time in the course of the argument that parol evidence could not be admitted to impeach the promissory note. This, however, was not the purpose for which the evidence was sought to be introduced; it was only to prevent the collateral operation of that note by showing that it was not intended to prevent proceeding on the bond, and thus to release the surety. If the evidence had not been admissible, the plaintiff ought not to have allowed the case to go to the Master; but such was the course taken,' and a great deal of evidence has in consequence been gone into, the result of which is clearly against the plaintiff. The defendant having sworn in her answer that there was an agreement that the promissory note should not affect her security, the plaintiff said that that answer was not to be relied on, and the Court therefore directed the inquiry. The result has been to prove in the most distinct manner that it was understood between the parties that the defendant's remedy on the bond was not to be affected; so that even if I was to reverse the decree, nothing more could be done than has been done already. * 416 * Cases were cited to show that the reservation of the rights against the surety ought to have appeared on the face of the promissory note; they, however, prove no such thing. They were cases of regular deeds or written instruments; and the Court held that their effect could not be taken away by a mere parol agreement. In the present case the finding of the Master is plain; it is in effect that there was a general dealing and a general understanding which, in point of law, amounts to a stipulation that prevented the promissory note in equity from having the effect of discharging the surety. What then a Judge of this Court has to decide is, whether or not there was in truth such an agreement as the defendant contends for: the evidence shows that there was; and the Master's report appears to me to be right. I must, therefore, dismiss the appeal, and with costs. *LEAF v. COLES. AND *417 In the Matter of JAMES COLES, a Person of unsound Mind. 1852. March 13. May 5. Before the Lord Chancellor Lord ST. LEONARDS. In a case where the dissolution of a partnership had been decreed in consequence of the lunacy of one of the partners, and large sums had been paid into Court to the separate account of the lunatic in respect of his share of the capital and profits of the business, the Lord Chancellor, on being subsequently satisfied of the complete recovery of the lunatic, ordered the fund to be paid out to him. Mode of proceeding in such cases. ON the 10th December, 1851, a decree was made in this cause and matter by the then Lord Chancellor, Lord TRURO, in pursuance of the decision of his Lordship reported ante, page 171, for the dissolution from that date of the partnership then existing between the plaintiffs and the defendant, James Coles, on the ground of the insanity of the defendant, upon the terms of the plaintiffs paying into Court to the credit of the cause and matter to an account to be entitled "The separate account of James Coles, a person of 1 See Owen v. Homan, 3 M'N. & G. 378, 411; S. C., 4 H. L. Cas. 997; Ex parte Harvey, In re Blakely, 4 De G., M. & G. 881. unsound mind: A capital account," the sum of 66,474l. 58. 1d., as the amount of the capital of the defendant in the business on the 31st December, 1850, including his share of the profits therein up to the same day, and also of paying into Court to an account to be entitled "The separate account of James Coles, a person of unsound mind: Income account," the sum of 67261. 88. 5d. in respect of his share of the profits of the business from the 31st December, 1850, to the dissolution, and interest on the said sum of 66,474l. 5s. 1d., at 5l. per cent from the 31st December, 1850, to the 12th January, 1852, after deducting the amount of certain sums drawn out on account of the defendant and interest thereon. These payments were duly made by the plaintiffs accordingly. Soon afterwards the defendant, James Coles, became restored to health and soundness of mind, and on the 10th February, * 418 1852, was, under the 72d section* of the Act 8 & 9 Vict. c. 100, discharged from the care of Dr. Stilwell, with whom he had been placed. The defendant then presented a petition to the Lord Chancellor, stating the proceedings in the suit and the above facts, and also stating that he had gradually completely recovered his health, and was then of sound mind, and sufficient for the government of himself and of his estate, and was willing to submit himself to the examination of such medical men as his Lordship should direct; and that he entirely approved of the arrangement made with respect to the copartnership and his interests therein. The petition prayed that the sum of 66,4747. 58. 1d., and the sum of 67261. 88. 5d. might be respectively paid to the petitioner, and that George Coles, the brother of the petitioner, and who had been appointed the guardian of his person and the receiver of his estate, might be discharged from those offices. This petition, which was supported by the affidavits of Dr. Conolly and Dr. Stilwell, now came on to be heard before the Lord Chancellor. Mr. Bethell and Mr. C. Barber, for the petitioner. Mr. Bacon and Mr. Stevens appeared to consent on behalf of the guardian and receiver, the heir-at-law, and all the next of kin. THE LORD CHANCELLOR.-I should be sorry, by any delay in making the order which is asked, to throw the slightest imputation of a doubt on my belief of Mr. Coles's recovery; but this recovery is very recent, and the Act of Parliament has manifestly pointed out that there shall in these cases be a discretion in the holder of the Great Seal, during a particular portion of time. (a) * What I propose to do, having some experience in mat- * 419 ters of this kind, is, to make an order for the payment to Mr. Coles of such money as he may have immediate occasion for; if, for instance, he requires the 6726l. 8s. 5d. of interest, he may on these affidavits receive it. If this was a case of real estate, I feel that I could have no hesitation in making the order at once; but the sum in Court is a very large one to be put into the possession of any man, and looking therefore to the comfort and safety of Mr. Coles, looking also at the providence which is over us all and which has so visited him, I think it will be more prudent to delay the order for the payment of the whole of the fund. I repeat, that, in prudence, I think it better to make now an order for the payment only of such sum as may be required for immediate wants; and I propose on this day month to request one of the Masters to see Mr. Coles, and after that, when I have had the pleasure of conversing with Mr. Coles for a quarter of an hour in my private room, I will make the order for the payment of the whole of the funds in Court. Mr. Bethell, on being asked by his Lordship what sum would be now required, stated that nothing would be wanted at present, the main object of the petition being to obtain the investment of the 66,474l. 58. 1d. which was in Court and unproductive. THE LORD CHANCELLOR, stating that he wished it to be understood that he did not entertain the least doubt of Mr. Coles's recovery, then made an order that the sum of 66,474l. 58. 1d. should be invested in consols; and that Mr. Coles should attend one of the Masters in Lunacy on the 13th April next, in order that the Master might personally examine him as to his state of mind. *Mr. Coles having attended the Master in pursuance of *420 the foregoing order, and the Master having made his report dated the 16th April, 1852, the petition was again put in the paper of the Lord Chancellor. VOL. I. (a) See 8 & 9 Vict. c. 100, § 95. 21 [321] |