
    *Jones v. Lackland & als.
    April Term, 1845,
    Richmond.
    (Absent Cabell, P., and Brooke, J.)
    1. Deeds of Trust — Suit for Application of Surplus— Parties — Case at Bar . — J. F. died in 1815; and in November 1816, her will, dated in 1803, was admitted to probat. JR. M. qualified as administrator on her estate, and in 1817 his administration was revoked; and W. II. and W. •/., two of the distributees of ,T. F., qualified as administrators de bonis non; and W.J, gave a deed of trust on land to indemnify his sureties, and secure the distributable share of B../., of whom he was guardian. After the death of W../., the trustee sold the land to pay B. J.’s claim, and there was a surplus of the proceeds of sale remaining in his hands. In 1837, the creditors of W. J. sued the trustee to have this surplus applied to the payment of their debts. Held. The legatees in J. F.'s will not necessary parties.
    2. Equity of Redemption in Land — Equitable Assets.— The proceeds of the sale of an equity of redemption in land, are equitable assets, to be distributed ratably among creditors.
    3. Equity of Redemption of Personal Chattels — Equitable Assets. — The equity of redemption of personal chattels is equitable assets, though the executor redeems them. Per Stanard, J.
    4. Deeds of Trust — Sale of Land after Death of Grantor —Right to Interest on Surplus. — Land conveyed in trust to secure a debt is sold by the trustee after the death of the grantor, and a surplus remains
    ' from the proceeds of sale after satisfying the trust. Held. The heir is entitled to the interest accruing on that surplus as against creditors of the grantor, up to the time of the decree directing its distribution.
    5. Same — Commissions of Trustee. — Under the circumstances, the trustee allowed a commission upon the amount of the debt secured by the trust deed, but not allowed commissions upon the proceeds of sale beyond the amount of the debt. Stanard, J., dissenting on the last point.
    Joanna Einnie died in 1815, having made a will in 1802, which was admitted to record in the County Court of Elizabeth City in November 1816. By this will she bequeathed her property to persons other than those who were her next of kin at the time of her death, and appointed several executors, none of whom qualified as such ; and subsequently Robert M’Candlish qualified as administrator on her estate. M’Candlish settled his administration account in 1817, and then paid over the ^amount found due upon that settlement, to William B. Haynes and William Jones, jr., who had qualified as administrators de bonis non upon Joanna Einnie’s estate, with William Jones, sr. and John Jones as their securities.
    The wife of William B. Haynes, and William Jones, jr. with his brother Bourbon Jones, were the next of kin of Joanna Einnie, and William Jones, jr. became the guardian of his brother Bourbon; and to indemnify his sureties in his administration bond, and to secure the estate of Bourbon Jones, he conveyed a tract of land in the county of Warwick in trust to Scervant Jones.
    William Jones, sr. and John Jones having-died, and Scervant Jones having become the executor of each of them, and William Jones, jr. having also died, leaving one child, Sarah Ann, an infant, and Bourbon Jones having come of age, and being about to take steps for the recovery of his interest in the estate of Joanna Finnie, Scervant Jones, in August 1825, made sale of the tract of land conveyed to him in trust for the sum of 1500 dollars, and out of the proceeds paid to Bourbon 343 dollars 69 cents, which seems to have been in full satisfaction of his claim. The balance of the purchase money remained in the hands of the trustee, who supported and educated the infant daughter of William Jones, jr.
    In March 1827 tlie plaintiffs, creditors of William Jones, jr., brought this suit in the late Chancery Court at Williamsburg against Scervant Jones in his own right and as executor of William Jones, sr., and John Jones, Sarah Ann Jones, Robert H. Tee sheriff of Warwick county, to whom the estate of William Jones, jr. was committed, and Bourbon Jones, to have the balance of the trust fund then in the hands of Scervant Jones, applied to the satisfaction of their debts. In their bill they alleged that Haynes and William Jones, jr. had each retained his distributable share of Joanna Finnie’s *estate ; that Bourbon Jones had received, as they had understood, the whole of his share; and that William Jones, jr. had died, leaving no personal estate. They therefore prayed that the balance of the trust fund in the hands of Scervant Jones might be applied to the satisfaction of their claims.
    Scervant Jones filed his answer, in which he denied all knowledge of the plaintiffs’ claims, stated the existence of Joanna Finnie’s will, and that the legatees under that will might yet appear to claim her estate,- and subject the sureties of William Jones, jr. therefor; and therefore insisted that the trust fund in his hands should not be diverted from the purposes of the trust, to be applied to the payment of the plaintiffs’ claims. He farther insisted that if the trust fund was to be applied to the payment of debts, he was a creditor of William Jones, jr. for moneys lent to him, and for other moneys paid for him, and that he expended considerable sums in the maintenance and education of the infant child of William Jones, jr. ; and he insisted upon his right to retain the amount of these claims out of the moneys in his hands, in preference to any other creditors of William Jones, jr.
    The cause coming on to be heard, the Court directed accounts to be taken: 1st, of the trust fund; 2d, of the debts of William Jones, jr. binding his real estate; and 3d, of the amount expended by Scervant Jones in the maintenance and education of the infant child of William Jones, jr.
    The report returned by the commissioner stated the trust fund in the hands of Scerv-ant Jones to be, on the 1st of October 1836, of principal 1126 dollars 38 cents, and interest 743 dollars 41 cents; the debts binding the land 1283 dollars 26 cents; and the amount expended on the infant, of principal 869 dollars 75 cents, and of interest 247 dollars 45 cents. In stating the account of the trust fund, the commissioner allowed to the trustee*a commission on the 343 dollars 69 cents, paid to Bourbon Jones, but disallowed commissions on the balance remaining in his hands.
    Various exceptions were taken to the report by both plaintiffs and defendants; and the cause coming on to be finally heard on the 27th November 1837, a statement was made at the bar under the direction of the Court; from which the interest on the trust fund, and the charge for the support of the infant were excluded; and the principal of the fund was divided pro rata among the creditors whose debts bound the real estate; and a decree was made, whereby the defendant Scervant Jones was directed to pay to each creditor his respective portion of the fund, with interest on the principal thereof from the 1st day of December 1837. From this decree Jones applied for and obtained an appeal to this Court.
    Harrison and G. N. Johnson, for the appellant.
    Daniel and Overton, for the appellee.
    
      
      Deeds of Trust — Death of Grantor Intestate before Sale of Property — Application of Surplus. — Where a grantor in a deed of trust to secure debts, which conveys real and personal estate, dies intestate before a sale of the trust subject, the surplus proceeds of the real estate, after the trust is satisfied, is applicable ratably to the payment of the debts of the grantor by specialty binding the heirs. Harvey v. Steptoe, 17 Gratt. 289. 305, citing the principal case.
    
    
      
      Same — Surplus — Legal Assets. — In Harvey v. Steptoe, 17 Gratt. 308, Joynes, J., in delivering the opinion of the court, said: "In a deed of trust, though the legal title is in the trustee, his estate never becomes absolute, and the right of the debtor, or his executor, to redeem or to receive the surplus after a sale is recognized by the character of the instrument, if not by its terms. I am therefore of opinion, that so much of the surplus of the trust fund as arose from the sales of personal estate and the collection of debts, must be treated as legal assets in the hands of the administrator. I am aware that this view is in conflict with an opinion expressed by Judge Stanabd in Jones v. Lackland, 3 Ch'att. 81; but that opinion was only a dictum, the question not being involved in the case.”
    
    
      
      Same — Commissions of Trustee, — See monographic note on "Deeds of Trust.”
    
   STANARD, J.

The objection of the appellant, that there was not proper parties when the decree was rendered, is not, well founded. The suit was by the creditors of William Jones, jr., who was at his death possessed of a tract of land, which in his lifetime he had conveyed to the defendant Scervant Jones in trust to indemnify his sureties in a bond as administrator de bonis non of Joanna Finnie, given in the year 1816. Under this deed of trust, the trustee, some time after the death of William Jones, jr. sold the land and applied a portion of the proceeds to pay a claim of a distributee of Joanna Finnie, and the object of the suit was to charge the surplus of the pro - ceeds of the sale in the hands of the trustee with specialty debts of William Jones, jr.. Scervant Jones the trustee represented the sureties in the administration bond ; so that their representative was a party. But it is alleged that Joanna Finnie left *a will, which has been proved and recorded, by which she bequeathed to persons named therein her personal estate; that the sureties to the administration bond may be held responsible to the legatees for the. assets that came to the hands of the administrator de bonis non, and that the persons named as legatees in the will ought to- have been made parties. If there were such legatees having a subsisting claim under the will, and the sureties of the administrator de bonis non could be made chargeable to them, and the indemnity to the sureties necessarily enured to the benefit of the legatees, then they ought to have been parties. All these must concur to make them necessary parties; and my impression is, that none of them exist. 1st. Though it appears that a will of Joanna Einnie has been admitted to probat, yet that will is dated in 1802, and the testatrix died in 1815, and the will was proved in 1816, and though legatees are named in it, it does not appear either by allegation or proof, that any one of them survived the testatrix; or that in the thirty years that have elapsed since the death of the testatrix, any claim has been made by any legatee. On the contrary, it does appear, that during that time the next of lrin of Joanna Einnie have been regarded as entitled to her estate; and that the defendant S. Jones made sale under the deed of trust to provide for the claim of one of the dis-tributees of Joanna Einnie, and applied part of the proceeds of sale to pay that claim. If it were necessary to extricate the case from this objection, I should feel myself warranted in the implication that the legacies lapsed, and none of the bequests of the will took effect. 2d. If there even were legatees entitled to claim under the will, and if the sureties in the administration bond could be made liable to the legatees, (which is problematical at least,) the default of the administrator in respect to which they might have been chargeable, occurred about twenty years before the decree in this case, and at the time of *the decree, the sureties were protected by this lapse of time from liability. 3dly. The indemnity given the sureties by their principal did not necessarily enure to the creditors, and legatees or distributees of the decedent. I apprehend, where a surety takes such security from his principal, he has full power over it, and may release or discharge it at least at any time before the party claiming under the primary obligation shall have asserted his claim in equity to value on this indemnity; or unless such release or discharge results from collusion between the principal and the indemnified surety. This case is not like that of an additional security taken by the creditor, to the benefit of which the surety becomes immediately entitled, and which the' creditor cannot surrender without the consent of the surety, but at the hazard of discharging the surety to an extent equivalent to the value of the surrendered security.

The more important question is, whether the trustee, who in his own right, and as representative, was a specialty creditor of William Jones,'jr., has the right to retain out of the surplus of sales in his hands, against other specialty creditors? or whether that surplus should be ratably distributed among all the specialty creditors?

At the death of William Jones, jr., the legal estate in the land,was in the trustee; and he had but a quasi equity of redemption. The rights of the creditors in the proceeds of the sale since made by, the trustee, ,m,ust, be measured,,by their right to charge' the land,' or rather the debtor’s equity therein at the time of his death. The question then is, what was the quality of this equity in the land, as the subject of charge by the specialty creditors? Is it legal or equitable assets? The equity of redemption of the fee simple mortgaged is equitable assets. Ram. on Assets 148; 2 Lomax on Ex’ors 238; 2 Williamson Ex’ors 1034, and the cases referred to. Even the equity of redemption of personal ^chattels is equitable assets, though the executor redeem them.

In the case where equitable assets are distributed by a Court of Equity, the maxim in equal! jure portior est conditio possidentis vel defendentis has no operation. Thus it has never been pretended, that when lands are devised to executors to sell, or to be sold, or that the executor shall sell lands for the payment of debts, or where the executor is a legatee, and there is a deficiency to pay that and similar legacies, that the executor in the one case has a right to retain for his debt, or in the other for his legacy. Equality is equity in all such cases; and the subject equally chargeable by all is distributed when insufficient, pro rata. My opinion is, that in making such distribution in this case the decree is right.

My impression is, that the Court below erred in limiting the trustee’s commission on the sale he made to that part of the proceeds that was applied under the deed of trust. Had not the sale been made by him, and before this suit, but made under the decree of the Court, the fund would have been charged with commission on the whole proceeds of sale; and to say the least, the charge on the fund is not more, nór are the creditors subjected to a greater one, by allowing the trustee such commission, than they would have been subjected to had not the sale been made and the conversion effected by him.

AEEEN and BALDWIN, J., concurred in affirming the decree.  