Statement of the case.

Company, not for Bynum and Grier; and that after the sale of the 28th of April, 1860, Olcott proposed to him to join in a new purchase of the property.

White, who had been acquainted with the property for thirty years, testified that in his opinion "the property could not be divided without destroying its value as an iron property."

It was further testified, by Bynum, that during the six years in which the property was held by Groot, and by Olcott and Stephenson, several thousand dollars' worth of timber was destroyed, and several thousand dollars' worth of ore was dug, and that the mills, machinery, dwellings, buildings, and fences were suffered to go to decay, to the great loss of the property. "That before the sale to Groot the company was leasing the property for $5000 per annum; but when they took possession again, under the sale of the 28th of April, 1860, the property was so injured and out of repair that he was unable to lease the manufacturing and valuable part of the same, and was able to rent only the tillable lands for a very small sum, to wit, about $500.

Witnesses of the other side, however, testified that much money had been laid out by Hovey and Stephenson on the property.

The court below dismissed the bill, holding that under the statutes of North Carolina, the copy of the copy of the unregistered deed from Hovey to Olcott and Stephenson, was not evidence, and therefore that Olcott had failed to show any connection with the property in question.

It may be well here to state that a statute of North Carolina* enacts that

"No conveyance for land shall be good and available in law, unless the same shall be proved and registered in the county where the lands lie."

And that an act of 1846† allows to be read in evidence "the registry or duly certified copy of the record of any deed" duly registered.

* Revised Code, chapter 37, 21.

† Ib. 8 16.

Argument against the sale.

And finally, that the seventh section of the Statute of Frauds is not in force in the State named. The section thus enacts:

"All declarations or creations of trusts or confidences of any lands, tenements or hereditaments, shall be manifested and proved by some writing signed by the party who is by law enabled to declare such trust. . . or else they shall be utterly void and of none effect."

Mr. W. A. Graham, for the appellant:

I. As to the lost deed from Hovey. The question here is, "Is a party to lose an estate granted by means of the loss of the deed before registration?" By the statute of North Carolina,* conveyances of lease are required to be "acknowledged by the grantor or proved on oath by one or more witnesses" and registered. In a case like the present, where there can be no literal compliance, on account of the loss of the original deed, which was a part of the primary evidence, we must resort to secondary evidence according to the rules of the common law. This can be done in a court of probate, in proceedings ex parte, as well as in courts of contestation. Here a copy is alleged to have been preserved, and copies are set out in the record.

The law of evidence requires in the circumstances of this case-1st, that the loss of the original shall be proved by the evidence of the plaintiff, the bargainer, in whose custody it was last seen; 2d, that the alleged copy is a true copy, and that the original was executed and delivered according to its import. Upon such proof the deed was properly ordered to be, and was, registered.

But if this deed were rejected there is abundant proof by parol that Stephenson and Olcott were entitled to the beneficial interest in the property, by their purchase in the name of Hovey, and their payment of part of and securing of the balance of the consideration. The well-known doctrine of equity applies, "that if one purchase an estate for another

*Revised Code, chapter 37.

Argument against the sale.

with the money of the latter, a trust results to the latter." And, as to Stephenson's share, the plaintiff produces the deed of Stephenson, releasing all his right in the premises. to himself.

II. Passing then to the merits. The next question is the validity of the alleged sale of the 28th of April, 1860. And it is to be remarked that Bynum, the trustee, who transacted the entire business, had an interest adverse to the plaintiff, being both a stockholder in the High Shoals Company and president. It is, then, the case of a mortgagee with a power of sale, and the manner of its execution is liable to the strictest scrutiny. Will it stand any scrutiny? We think

not.

1st. The sale was made for cash in toto. The trustees had no power to sell for cash in this way at the time when they did so sell. Only one-third of $40,000, with interest on that third from January 1st, 1859, was then due and demandable. The plain duty of the trustees was either to wait till the whole fell due, 1st January, 1861, after which they could have sold for cash; or, if resolved to sell at once, to have set up the property for cash as to one-third, credit on another third till the 1st of July, 1860, and on the balance till 1st of January, 1861. The mortgage does not contain the word "cash;" it was a mere requirement of the trustees, without authority, which chilled the sale and depressed the price by thousands of dollars.

If a sale for cash in toto was not wholly ultra vires, the only footing on which it could be maintained, even upon the allegations of the defendants, would have been to credit the one-third of the debt then due upon the mortgage, require Sloan to pay down the residue of $26,666.66, and pass this over to the complainant. The alleged purchaser had no right both to the property and the money. A trustee has no right to receive money before it is due, much less to raise it by sale. It is further apparent from the continued action of Bynum and Grier, as trustees, with no other evidence of title except the deed of January 1st, 1859, that they were the purchasers at that sale. Had Sloan purchased for

Argument against the sale.

the company, he or they should have been invested with title, and the trustees denuded. This was never attempted to be done till June 12th, 1868; after the filing of the bill in this suit. If our assumption of fact here be true, the old doctrine applies, that a trustee cannot purchase from himself.* 2d. But if the company be assumed to have been the purchaser, the sale was made in such disregard of the interests of the plaintiff that equity will not permit it to stand. Before a trustee can assert that he has foreclosed the rights of the mortgagor by a sale in pais, he should be able to show that it was such a sale as would have been ordered by a chancellor if application had been made to a court.

Now, no chancellor would have ordered a sale of this vast property for cash when ouly an instalment of $13,000 was due. Sloan admits that the property would have sold better on a credit, and in that case might have been enhanced in price by dividing it into lots.

So a sale of the property in solido in that state of the mortgage debt was a great wrong to the plaintiff. It may well be questioned whether a sale by a sheriff, under similar circumstances, would not have been void. If the property can be separated, and exceeds the debt, no more ought to be sold than will pay the debt. The presumption is, when the estate is very large and at all capable of division, that a sale in parcels will be most advantageous.

The opinion of the defendants' witnesses, that a sale in lots would not have been more advantageous, is entitled to little weight, when they themselves prove that no single estate of such magnitude exists, and none equal to it has ever been exposed at auction sale in that section of country, and it is obvious that by reducing the parts within the ability of bidders much more competition might have been expected.

3d. As to the place of sale, any neighboring town would obviously have been more eligible than this place, a remote and unfrequented one.

* Fox v. Mackreth, Leading Cases in Equity, p. 92, with notes.

Recapitulation in the opinion of the facts.

There is nothing in the letter from New York, February 25th, 1860, consenting to a sale for cash in toto, or agreeing to anything variant from the terms of the mortgage; it asks only that the trustees will not be too rigorous, and allow some six or eight weeks longer for an endeavor to raise money.

Mr. W. H. Battle, contra.

Mr. Justice SWAYNE delivered the opinion of the court. The object and prayer of the bill in this case are to redeem certain premises therein described, consisting of upwards of 14,000 acres of land, sold by the defendants Bynum and Grier to the defendant Sloan, under a mortgage containing a power of sale. The mortgage was executed by the defendant Hovey, and bears date the 1st day of January, 1859. Bynum and Grier, as trustees for the High Shoals Manufacturing Company, were the mortgagees. The mortgage recites that Hovey had executed to Bynum and Grier a penal bond in the sum of $80,000 to secure the payment of $40,000 in three instalments of $13,333.33 each, the first payable on the 1st day of January, 1860, the second on the 1st of July, 1860, and the third on the 1st of January, 1861, all with interest from the 1st of January, 1859. It was conditioned that, in default of payment of either of the instalments or the interest thereon, or of any part of either when due, it should be lawful for the mortgagees to sell at public auction all the mortgaged premises, and to make and deliver to the purchaser a deed in fee simple, and out of the moneys arising from the sale to retain the amount of the principal and interest which should then be due on the bond, together with the costs and charges of advertising and selling, rendering the overplus, if any, to the mortgagor, his heirs, or assigns; "which sale so to be made," it was provided, "shall forever be a perpetual bar, both in law and equity, against the mortgagor, his heirs and assigns, and all other persons claiming or to claim the premises, or any part thereof, by, from, or under him, them, or either of them."