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1803.

O’HERLIHY

V. HEDGES,

think not. If indeed such a lease had been actually executed, and without containing a provision that the tenant should not assign without license, in such case the landlord must suffer for his folly. The difference in the character of the tenant may make a great difference with respect to the lands, and may be an injury to the landlord to an incalculable extent: and therefore it would be dangerous to establish merely on the principle that a trustee shall gain no benefit for himself, that a party not knowing of the trust shall be obliged to execute an agreement made with the trustee. Suppose a farmer in possession of a farm at a rack-rent, holding under an assignment of a lease, and being the apparent owner: he cultivates the land well and gives satisfaction to his landlord, who for his encouragement proposes to give him a further term, and he enters into a contract to that effect; and then the person who assigned the lease starts up and insists that the farmer was his trustee, and, though the landlord knew nothing of such trust, that he must execute a lease to him and not to the tenant. Surely the landlord has a right to say, “ I never would have entered into such a “ contract with you.” This in principle comes up to the present case.

I think it would be infinitely too much to found such a decree as is sought, upon a principle made for a quite different purpose, and therefore I think the former decree ought to be affirmed, but without costs, as there was some doubt in the case.

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1803.

HUGHES v. KEARNEY.

a

March 9. Purchase mo.

BY indentures of lease and release, bearing date the 18th ney unpaid is, prima facie, a and 19th days of March 1741, Thomas Hughes conveyed lien on the lands sold ; and

the lands of Aloortown in fee to John Kearney, the father of if a security is defendant, in consideration of the sum of 2,050l. ; and taken for that money, it lies receipt for that sum was executed on the back of the conveyon the vendee ances : but the sum of 1,245l. remaining unpaid at the time to shew that the vendor of executing the deeds, Kearney executed a promissory note agreed to rest for that sum to William Knox as a trustee for Hughes ; and on that securi. ty, and to dis- there being debts of Hughes affecting the lands, the amount charge the lands. A note

of which was not ascertained, it was agreed that the note passed by ven- should remain in the hands of the trustee until they should dee to a trustee for part of the be ascertained. In July 1742, Kearney paid 6001. to the purchase money, out of the

trustee in part discharge of the note, and in August 1743, amount of he paid off a judgment debt affecting the lands, of 3401. which incum. brances then

1s. 7d. Several other small payments were made, the last of not ascertained which was on the 7th of April 1746, at which time there were to be sat. isfied, and the was a balance due of 321), on account of the noie. In balance only

December 1749, Kearney filed a bill against Hughes and paid to the vendor, is not Knox, praying an account of judgments and incumbrances such a security as will dig.

affecting the lands, and that they should account with him ; charge the lien and that the note should be brought in and given up to on the lands.

Kearney, he paying what was due thereon, (if any thing). That suit was protracted from various causes till June 1767, when there was a decree to account, but nothing further was done in the cause.

Thomas Hughes died in May 1769, and in February 1770 the present bill was filed by his younger children, the principal object of which was to make the purchased lands lia

1803.

HUGHES

V. KEARNEY.

ble to a sum of 1,000l. part of the marriage portion of the mother of the plaintiffs; and for this purpose it charged that by the marriage settlement of the mother, (in which Kearney was a trustee) Hughes had been empowered to lay out this part of her fortune in lands ; that he did purchase the lands of Moortown with this money, of which Kearney had notice, who therefore, as it insisted, took the lands cum

Notice was however denied by Kearney, and the plaintiffs had failed in proving this part of their case : but the transaction of the promissory note, as above mentioned, appeared upon the pleadings, though the bill did not pray any specific relief on that ground. Kearney the purchaser answered in 1771, and died soon after, and the suit was revived against his heir at law, the present defendant, who answered in 1772, and in 1789 the suit was again revived.

onere.

On the hearing, Lord CLARE directed an account of the principal and interest due on the foot of the purchase money, and an account of the personal estate of Kearney the purchaser, and it being reported in November 1801, that there was then due for principal and interest the sum of 1,409). 11s. 7d. and that Kearney had left no personal estate, and the cause being set down to be heard on report and merits, his lordship on the 21st of December, 1801, decreed the said sum with interest from the date of the report, to be a charge upon and to be raised out of the lands of Moortown.

The cause coming on now to be re-heard.

Mr. William Johnson, for the defendant, stated two objections to the decree : First, That interest was given on the sum of 321l. reported due in April 1746; and secondly, That that debt was made a lien on the lands: but the order for

1803. re-hearing did not go to the first question, and therefore it HUGHES

was not discussed: the Lord CHANCELLOR, however, in

timated his opinion that the decree was right in that respect, KEARNEY.

the rule being that when part of the purchase money remains Purchase mo- in the hands of the purchaser for the purpose of paying off ney remaining in the purchao incumbrances, it shall bear interest. ser's hands to pay off incum. brances, shall Mr. Wm. Johnson to the second objection :--The general bear interest.

rule certainly is that a balance of purchase money remaining in the purchaser's hands, shall be a lien on the lands purchased : this grows out of another rule, that where lands are sold and no part of the money paid, the purchaser shall be a trustee for the vendor, and therefore if part be paid, he shall be a trustee for so much as is not paid. It is so expressed by Lord LOUGHBOROUGH in Blackburne v Gregson, 1 Bro. C. C. 424. But the authorities admit that this rule applies only where no collateral security has been taken for the money so remaining unpaid, Bond v. Kent, 2 Vern. 281. Fawell v. Heelis, Ambl. 724: for, “the taking of

such security may reasonably lead to the conclusion that " the vendor trusted to such security, and that the property “ of the estate was intended to be absolutely vested in the

vendee.” 1 Fonbl. 143. In Bond v. Kent, the distinction was fully recognized; “ Kent purchased of Bond the lands “ in question, and re-mortgaged them for securing part of the

purchase money, and for the other part gave a note paya“ble on demand, on which 2001. was unsatisfied ;" it was held that the acceptance of the note discharged the lien. And in a late case, Austen v. Halsey, 6 Ves. fun. 475, the Lord CHANCELLOR, though he says it is clearly settled that the vendor has a lien for the purchase money while the estate is in the hands of the vendee, yet excepts the case“ where

upon the contract evidently that lien by implication

1803.

HUGHES

KEARNEY.

was not intended to be reserved ;” and this case it is contended, falls within that exception. Courts of equity have never gone so far as to allow a vendor, after accepting a security, to desert it and resort to his lien on the lands. In many cases, a collateral security is more eligible than to have a lien on the lands, which will oblige a party to come into equity for relief.

Mr. O'Grady and Mr. B. Hamilton, for the plaintiff, were not called on to argue

the

case.

Lord CHANCELLOR.

In the case in 2 Vern. it was manifestly the intention of the parties that the amount of the note should not be a lien on the lands; else they would have had a mortgage for the whole : the seller took the estate for his debtor for part of the purchase money,

and was content with the note for the remaining part. But is there any case where the heir of the vendee has been permitted to hold what his ancestor unconscientiously obtained ? and is not a thing unconscientiously obtained, when the consideration is not paid ? Suppose that nothing was paid, but that a receipt was signed by the vendor: a purchaser from the vendee without notice could hold ; but if the person claiming as a purchaser admitted that the consideration was not paid, this would be taken primâ facie as a fraud, and it would lie upon him to shew that it was not a fraud. So it lies on the purchaser to shew that the vendor agreed to rest on the collateral security ; primâ facie, the purchase money is a lien on the lands.

But in this case the purchaser's note is nothing but a mere memorandum, put into the hands of a trustee, to enable the purchaser first to pay off incumbrances, and then to be

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