
    Wilson F. Dillon vs. William Bennett et al.
    W. having notes of G., secured by a deed of trust on land and slaves, G. sold part of the slaves to B., and subsequently all the other slaves; and at last, with the assent of W., sold the land for a sum sufficient to pay the whole debt due to W.; but by agreement with W. paid him only half the sum the land sold for, retaining the residue for himself; W. subsequently filed his bill against one who had purchased a portion of the slaves, to subject them to that part of his debt remaining unpaid : held, that by releasing part of the security held by him, he discharged from the lien of his deed the property previously sold by the grantor in the deed of trust. It would be inequitable to permit the creditor, who had a lien on the whole property, that which had been sold by his debtor as well as that which was unsold, to release the latter and asseit the former lien ; it would violate the principle of equity ai.d good faith upon which the doctrine of marshalling assets rests.
    
      On appeal from the superior court of chancery; Hon. Stephen Cocke, chancellor.
    The bill, filed by Wilson F. Dillon, states that in the year 1838, Miles Luster purchased of complainant lands, and in part payment assigned to him, by an instrument in writing, two promissory notes, made by Wm. Grissom and Thomas Davis, dated in 1836, one due 1st January, 1840, for $10,706, and the other due 1st January, 1841, for $20,706 ; the first note is paid, and on the last there is due $4456'66, after deducting credits; that said Grissom made a deed in trust, to secure said notes, to Hoopes and Burroughs, trustees, conveying certain lands and negroes therein described, by which the trustees were authorized, on the failure to pay the last note, to sell the land and negroes; this deed of trust was assigned to complainant with the notes. Grissom, in the fall of 1839, removed said slaves from Claiborne to Yazoo county, where he settled,' and within three months thereafter, and as soon as complainant learned of said removal, said trust deed was recorded in Yazoo. That complainant has recently learned that certain of said negro slaves are now in the possession of defendant, Bennett, in Madison county, by a pretended sale by Grissom to Bennett, which sale was made by Grissom in collusion with Bennett to defraud complainant. That Grissom has not property sufficient to pay said last note, unless said negroes in said trust deed be applied thereto.
    The answer of Grissom denies, that he removed the slaves sought to be subjected to complainant’s- demand, to Yazoo county, and states, that more than a year before that time, he had sold said slaves to defendant, Bennett, who had possession of them in Madison county.
    That in January, 1839, one McIntyre desired to purchase the lands in said trust deed mentioned, for $25,000, provided he could get the same discharged from said trust deed; and it was expressly agreed between complainant, and Grissom, and McIntyre, that McIntyre should execute his two notes to complainant for one half of said sum, $12,500, and his two notes to defendant, Grissom, for $12,500, for his own use and benefit, and said trust deed was then to be released as to said land. Said arrangement was completed, by McIntyre giving his notes to complainant for $12,500, for the sole use and benefit of said Grissom, and said deed of trust was entered of record satisfied as to said lands, and Grissom executed a deed to McIntyre for said lands. Complainant gave Grissom credit on the notes secured by the trust deed to the amount of the two notes made by McIntyre to complainant, for $12,500, and the other half of the purchase money, $12,500, was, in pursuance of the agreement, appropriated to the use and benefit of Grissom, and no part of said last mentioned sum was to be applied, or was actually applied, to the said trust deed; all this was by the agreement and consent of complainant.
    Denies the charge of fraud and collusion in the sale to defendant, Bennett.
    The answer of Bennett adopts the answer of Grissom, and relies on the defences therein set up. Admits that he purchased in January, 1838, certain named slaves of Grissom and Davis claimed to be in the deed in trust; but he made said purchase without notice of said trust deed, and for a full and valuable consideration, before said Grissom removed from Claiborne county to Yazoo county, &c., and bona fide; charges, that complainant consented and agreed that Grissom should appropriate to his own use, and divert from the trust deed the sum of $12,500, for half the proceeds of the land mentioned in said deed, which was sold to McIntyre, as set forth in Grissom’s answer; and that this was long since the purchase of said negroes, now involved in this suit by defendant, Bennett, from Grissom; and he insists that this transaction precludes the complainant from subjecting the negroes, purchased long previously by this defendant from Grissom, to liability for the debts in the trust deed; and that complainant, by permitting said Grissom to appropriate $12,500 of the avails of the property specified in said trust deed, to his own private use, ought to be prohibited from enforcing his debt against property purchased bona fide by this defendant, long before said transaction between complainant and Grissom.,
    
      Denies all fraud and collusion, &c., &c.
    The deposition of Miles Luster, for complainant, proved that witness was present when the negroes in controversy were sold by Grissom to Bennett, in 183S; when said sale was made, witness had given up his interest in the trust deed to Dillon. Witness mentioned to Bennett that the negroes were conveyed in the trust deed.
    Deposition of Thomas G. McIntyre, for defendants, states that in January, 1839, the arrangement was made between witness, complainant, and Grissom, whereby witness purchased the land mentioned in the trust deed, and gave his notes to'complainant for $>12,500, and his notes to Grissom for $12,500, and in consideration thereof the trust deed was discharged as to the land, as stated in Grissom and Bennett’s answers. Pie also proved that in March, 1841, the lands could not have been'sold for more than $12,500.
    On final hearing the chancellor dismissed the bill, from which the complainant took an appeal.
    
      E. W. F. Sloan, for appellant, cited Cheeseborough v. Millard, 1 Johns. Ch. R. 411.
    
      A. U. Handy, for appellees.
   Mr. Justice Clayton

delivered the opinion of the court.

This was a bill filed by Dillon, in the superior court of chancery, to obtain a decree for the sale of certain slaves, under a deed of trust. The complainant was the assignee of the notes secured by the deed of trust. The property contained in the deed was a tract of land with a number of slaves.

In January, 1838, the defendant, Bennett, purchased a part of the slaves from Grissom, who executed the deed of trust, and removed them from the county. All the other slaves were subsequently sold by Grissom.

The land was sold at private sale, with the assent of Dillon, for $25,000, more than enough to pay the whole debt due him. Yet by agreement with Grissom and the purchaser, Dillon received only half of this sum, Grissom the other half, and the land was released from'the trust deed. This was in 1S39.

The question is, whether this agreement has the effect to release the slaves, purchased by Bennett, from the operation of the trust. On very plain principles we think it does.

In the Agricultural Bank v. Pallen, 8 S. & M. 357, it was decide.d, that where a judgment creditor had a lien upon several pieces of property, some of which had been alienated by the debtor, the property not sold must be first applied to the payment of the debt. If all have been sold, the last sold must be first applied. The same principle is recognized in Rollins v. Thompson, 13 S. & M. 524.

Perhaps it is unnecessary to declare, whether this rule is applicable in its fullest extent to this case. Its object is the preservation of entire good faith between all parties interested. In this instance a great deal more property was embraced in the deed of trust, than was requisite to pay the debt. After the purchase by the defendant, there was enough left of the trust property to pay the debt. He had a right to require, that the creditor in the deed of trust should not release any of the residue of the encumbered estate, so as to throw any farther burden or risk on that which had been sold. Dillon subsequently released the land, and thereby gave up $12,500. As to Bennett, who had previously purchased and paid for these slaves, justice requires that they should be exempt from liability to the amount so released. Had the creditor, Dillon, been merely passive, we will not decide whether Bennett would be entitled to the same relief. But his active interference gives a right to the relief. The probable fact, that the land would not have sold for $12,500 in cash, at the time the sale under the deed of trust might subsequently have taken place, cannot vary the result. The creditor cannot be permitted to speculate upon the chances, and throw the risk upon another.

All the property in the deed of trust was originally liable to its satisfaction. A purchaser with notice, could not claim its absolute exemption. Bfennett occupies that position. All he could have required, was to marshal the order of application. Bat when the creditor discharged a part of the property after this parchase, he interfered with this right of the purchaser. He took the hazard upon himself, and must be held to have discharged what had been previously alienated, and impliedly to have agreed to look only to what remained.

The decree is affirmed.  