Case ID: sc-eq_11/html/0062-01.html
Source: Caselaw Access Project
Author: {"author": "O’Neauii, J. Johnson, J., and Harper, J., O’Neall, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

James Chesnut and John Chesnut v. The Fire and Marine Insurance Company, Sarah Vaughan, Benjamin Bineham, Wm. Blanding and Geo. L. Champion.
    Funds being in possession of the Court (or subject to its order), the Court ordered notice to be published for creditors to come in and establish their claims in opposition to one of the defendants, who claimed it as a principal creditor: — field, that all the creditors who came in under the order were rightly in Court, properly parties to the case, and bound by the proceedings: and an order of the Chancellor requiring them to file a cross bill, on order to establish their demands, reversed. [*84]
    Order of the Chancellor quashing the reports of a former Commissioner on claims of creditors, because it did not appear that before making them up he had given the parties notice, or an opportunity afterwards to contest them reversed. In the absence of proof, it will be presumed that the Commissioner had done his duty and given due notice; but under the circumstances, the reports referred back to the present Commissioner, with instructions to regard them as prima facia evidence in favor of the claims reported, but with leave to falsify them by proof. [*86]
    Camden.—
    Wilie Vaughan, by deed dated 12th April, 1819, in consideration of natural love and affection for his wife and children, and also in consideration of five dollars, conveyed to Benjamin Bineham, Wm. Blanding, and George L. Champion, all his estate, in trust, for his *wife, Sarah Vaughan, for her separate use for life, and after her death, in trust for such of the heirs of her body, by the said Wilie begotten, and in such manner and portions, as she by deed or will, may limit and appoint, and in default of appointment in trust for Claiborne Vaughan, Eliza Virginia Vaughan, and such other heirs of the body of the said Sarah, by the said Wilie, hereafter to be begotten, as may survive the said Sarah, share and share alike, &c. The property to be in no manner liable to the future debts of Wilie Vaughan. The trustees, or a majority, are authorized to collect .the debts due, and apply them to paying just debts, and the deed thus proceeds: “ But as the debts due to me will be insufficient to pay the debts I owe, for the complete and final discharge of my debts, the said William, Benjamin, and George, or a majority of them, are hereby authorized and empowered to sell and dispose of, in such manner and on such terms as they, the said William, Benjamin, and George, or a majority of them, shall think fit, any portion of the said property, real or personal, and to make good titles therefor. And after the debts are paid, they, or a majority, are authorized to sell the lands and make titles, and invest the proceeds in such way as they, or a majority, shall think fit, subject to the limitations, directions and purposes above set forth.” Bineham and Blanding declined the trust. George L. Champion alone acted, and sold to John and James Chesnut, the plaintiffs, several of the negroes, for which he took their bond for $3,000 — and sold to James Chesnut three of the negroes, for which he received cash. He sold the bond to the defendants, the Fire and Marine Insurance’ Company, at fifteen per cent, discount and one per cent, brokerage.
    On the 15th of January, 1823, the plaintiffs filed this bill against Champion, the Insurance Company, the two other trustees, and Sarah Vaughan, setting forth their purchase of the slaves from Champion alone, the other trustees having declined to act. That there were specific liens upon the slaves, and they required the proceeds of the sales to be applied to discharge them. They state that Champion had assigned their bond to the Insurance Company, who demanded payment: that plaintiffs ought not to pay until Champion caused the title to the slaves to be perfected by procuring the assent and joint sale by a majority of the trustees, and by applying the amount of sales to discharge the specific liens. They pray to be relieved from their contracts, or their title to be Confirmed and quieted against the claims trusts and the execution creditors. | of the cestui que .
    Blanding and Bineham answer that they declined the trust.
    Champion’s answer admits the sale of the negroes, and that Mrs. Vaughan, as executrix of Wilie Vaughan, joined in the sale: that he transferred the bond to the Insurance Company, who gave him the money for it, but at fifteen per cent, discount, and that he expended the money as trustee of Vaughan, in discharge of debts due by the estate and the general exigencies of the estate; that he alone acted under the trust. That as the proceeds of the negroes have been appropriated to the benefit of the trust estate, the bond or sale ought not to be set aside or cancelled. That a trustee ought to be appointed by the Court to act with him, with orders to confirm the titles, as the estate has had the benefit of the sales.
    The Charleston Fire and Marine Insurance Company answer, that the bond was assigned to them on the 23d May, 1821, by endorsement thereon of George L. Champion, acting trustee of the estate of Wilie Vaughan, and Sarah Vaughan, his executrix and residuary legatee. That the Company knew nothing of any discounts against the Bond, nor of the nature of the debt. That Champion had a right to sell the slaves, either to pay debts or for the other purposes of the trust. That plaintiffs have a good title to the slaves and have nothing to do with the fund that may come into Champion’s hands. That, as trustee, he was authorized to receive the money on the bonds, even if bound to apply it to any existing demands. That the advance of the money by them on the bond must be viewed in the same light as if the plaintiffs had paid it, and that they are therefore entitled to hold the bonds and receive the amount in discharge of their advances to Champion and Sarah Vaughan. That they are purchasers without notice, and if Champion is bound to apply the proceeds to any particular purpose, he has received the amount, and the Court may order him to apply it as it pleases. They trust that he will be ordered to make a good title to the slaves, and that the plaintiffs be ordered to pay them the bond.
    The Commissioner reported on the 10th February, 1824, as follows :— That on the 12th April, 1819, Wilie Vaughan made a deed of trust to the trustees with power to sell his estate to pay his debts, and for the benefit of Sarah Vaughan, his wife, and his children. That the sales made by G. L. Champion and Sarah * Vaughan were without sufficient authority, because Bineham, Blanding and Champion L were appointed trustees, and a majority were authorized to sell; and Mrs. Vaughan could only sell her interest, which was a remote one. He recommends a confirmation of the sale, because the price is greater than could be got now. — That the funds, or the greater part arising from the sales, were applied to pay pressing demands against Wilie Vaughan, and in support of his family, and that subsequent sheriff’s sales have been made to an amount sufficient-to discharge the liens in plaintiff’s hill mentioned.
    Order, February Term, 1824. — On motion, Ordered that the report be confirmed, and that plaintiffs pay the amount of the bond yet remaining due, into the hands of the Commissioner, subject to the future order of this Court. Referred to Commissioner to report at the next Court upon the claims of persons entitled to this fund, and that G. L. Champion account before the commissioner for his application of the funds which came into his hands from the sale of the bond to the Insurance Company, and that the Commissioner give notice to the creditors to come in and make their claims.
    
      A decree was pronounced at the same term by Chancellor, De Saussure, upon the claims of Drs. Blanding, De Leon and Anderson, who had proved their demands, and claimed payment out of funds raised by sale of part of the estate of Wilie Vaughan, under the trust deed. The only question was as to interest, which the decree allowed contrary to the report.
    Order, June Term, 1825. — Upon motion, it is Ordered that the funds now in the hands of the Commissioner, and such as may come into his hands before a final report, be paid over to the Fire and Marine Insurance Company, subject to the rights of the contesting claimants, and subject to the further order of this Court.
    At June Term, 1821, the Commissioner, Mr. Evans, reported, viz :— “That on the 12th April, 1819, Wilie Vaughan assigned his whole estate to Bineham, Blanding and Champion, in trust for his family, and to pay his debts* giving a majority of them power to sell for that purpose. Champion alone accepted, managed the estate, made considerable sales of personal property, and applied part of the proceeds to pay the debts due by W. Vaughan before the assignment, and part for debts contracted by himself as trustee. He sold several negroes to John Chesnut, for which he took the joint bond of John and James Chesnut for *3000 ; several negroes *to William Trapp, and took the joint “ bonds ofWm. Trapp and A. F. Peay for $2326. On the 2d June, 1821, these boijds were sold to the Fire and -Marine Insurance Company of Charleston,' at large discounts; Chesnut’s at fifteen per cent, and Trapp’s and Peay’s at ten per cent., and one per cent, on the whole -for brokerage. Ohesnut’s bond have been enjoined by this Court, and have been paid. Trapp’s and Peay’s bonds were not specially enjoined. In consequence of these transactions between the trustee and the Insurance Company, I have reported them creditors of the said estate, after the assignment, to the amount of money actually paid by them for the said bonds ; this Court having already decreed that George L. Champion acted in the sale of the negroes without sufficient authority. The amount of demands against the estate which have been rendered to the Commissioner, and were contracted previous to the deed of trust, is
    $6,038 50
    Amount of demands, including the sums due to the Insurance Company on account of their purchase of Chesnut’s bond, and Peay’s and Trapp’s bonds, and interest to the 23d June, 1821 and debts contracted by the trustee, or otherwise, .... - 8,112 18
    $14,151 28
    
      That Wilie Yaughan was appointed guardian of his children in 1813, and entered into the usual bond, and acted till 1820, when his letters of guardianship were revoked. He never made a return. He planted in common with his children, the place called Rocky Branch, and was entitled under the authority of this Court to one half the proceeds of the crops. ' His children, on this account, must have large demands against his estate, as good crops were generally made, and produce high; but in consequence of his having made no returns, I am unable to fix on any amount. Wilie Yaughan also sold in 1819 or ’20, a negro woman, Beck, and child, the property of his children, to James Gardner, for $800. The sale was made without the authority of this Court, and has never received its sanction or confirmation. I recommend that his estate be chargeable with this amount, together with the interest from the time of sale.”
    The report states that the “ available funds belonging to the estate of Wilie Yaughan, including the bonds of John and James Chesnut, and Trapp and Peay, amount to $12,041 34; and recommends *that the debts reported to be due before the assignment, and stated in L the schedule attached to this report, and the amount which may be found to be due to the children of Wilie Yaughan, be first, creditors of the trustee, after the assignment, be nexfi degree.”
    The report further recommends, that the “ bond Chesnut, which has been paid by the order of the up to them ; and that the whole real estate of Willi assignment, and not sold by the trustee, be sold by tÉjj a credit.”
    The following report of the same Commissioner, appears in the proceedings :
    “That on the 12th April, 1819, Wilie Yaughan assigned to Bineham, Blanding and Champion, in trust, his whole estate, for the benefit of his family and to pay his debts ; authorizing them or a majority, to sell any part of Ms estate for the purposes aforesaid —G. L. Champion alone accepted the trust, and managed from April, 1819, to January, 1824, and sold, to James and John Chesnut, negroes to the value of $3000'; and to William Trapp and A. F. Peay, negroes to the value of $2,093 40. This Court, in a former decree, decided that Champion acted without sufficient authority in the management of the estate, but confirmed the sale to John and James Chesnut, because it was favorable for the estate.' The sale to Trapp and Peay has not as yet been confirmed.
    “I report that judgments to the amount of $4,319 42, have, since the assignment, been recovered against Wilie Yaughan and his trustee, Champion; and property has been sold by the sheriff of Kershaw District, to the amount of $-, and applied to the said judgments, and the estate is now wholly insolvent.
    “I report that Wilie Yaughan, in 1813, became guardian of his children, and acted as such until his death, in 1821, without making any return of his acting as such to this Court, and that his children, in consequence of his guardianship, are creditors of his estate, to the amount of $4,418.
    
      “ I report that at the time of the assignment, on the 12th April, 1819, all his creditors ought to have been placed on the same footing, and paid in proportion to their several demands.
    “ I recommend that a trustee be appointed to carry into effect the intention of the assignment, and that the persons who have obtained #ho-i judgments and received the whole of their demands be made *parties to this bill, and be compelled to refund what they have received over and above their dividends.
    “I report that James and John Chestnut have paid the amount of their bonds which were sold by Gr. L. Champion to the Fire and Marine Insurance Company, and the simple interest on the same, into this Court in pursuance of an order of this Court, June Term, 1824. I therefore recommend that the said Company be compelled to deliver up said bonds on the payment to them of the principal and interest, deducting, however, the interest on the same during the time it was impounded by this Court. ”
    The cause was continued from term to term, until it came before Chancellor Johnston, special term, November 1833. Mr. W. F. De Saussure then moved to confirm the two last reports of the ex-commissioner, Evans, one dated June, 182T, and the other without date And as incident thereto, that the Court should take up and consider the question, who is entitled to the money secured by the bond of the plaintiffs described in the pleadings.
    Mr. W. Mayrant opposed the motion, on the ground that the reports were made without authority and without summoning the parties; and that unless the reports are properly made up, the rights of the claimants cannot be properly decided.
    The Chancellor granted an order quashing both the last reports — ■ “because no evidence was reported with them to enable the Court to judge of their correctness or incorrectness, and because it did not appear that before the Commissioner made them up, he had called the parties interested before him, or given them any opportunity to attend to their rights ; nor had they notice of the reports so as to enable them to except. Besides, it appeared that for the last seven or eight years, the Court had declined to act on the reports, which (thus travelling from the Commissioner’s office to the Court and back again, each party insisting that the other should be the actor, which was retorted,) formed a serious impediment to the case.”
    Mr. Mayrant, then on the part of the Insurance Company, moved that the bill be dismissed as to' them for want of prosecution, as well as because, after the confirmation of their purchases, there were no longer any equities in the bill entitling it to be retained as against them. At the same time Mr. Blanding moved that the claims of Yaughan’s creditors, heretofore rendered and not established, be referred to the present j...-. Commissioner to report thereon, ^distinguishing such as were contracted before and after the execution of the deed of trust. That the accounts of Champion be referred, and that he account; and that the Commissioner report the amount of funds received and how applied.
    Both motions were refused, but the Court passed an order to the following effect:—
    
      That the bill be retained but further proceedings in the cause be suspended. That persons claiming the fund in opposition to the Insurance Company, have leave to file a cross bill laying claim to the same, setting out the ground of their claims, and making the parties necessary to a full decision: that unless such, bill be filed by the-day of ■-this bill stand dismissed as to the Insurance Company, without prejudice.
    Chancellor Johnston. The bill was not dismissed at present, because the Court, by confirming the sale to the Chesnuts, and ordering the fund to be paid in, and allowing creditors to render their claims, had, in some sort, pledged itself to see their claims duly dealt by; and if the bill were now dismissed, injustice might be done by the lapse of time or act of limitations, to which their dependance on the pledge of the Court may have subjected them : to say nothing of the expences to which they may have been subjected on the same confidence.
    Proceedings were stayed, because the experience of eight or ten years was proof, that, without a cross bill, the responsibility of becoming actor could not be thrown on any one, and in the present course, there was no likelihood of ever seeing the end of the cause. Whose duty was it to press George L. Champion to an account? Were Yaughan’s creditors bound to do it? Were they entitled to this fund until they established a deficiency of other assets, and that there was no other resource ? If not — if they were bound to show such exertion and deficiency, what means had they to enforce such accounting ? Where were their charges ? How had he been allowed the benefit of this answer ? Again, did it not appear from the reports and other proceedings, that there were trust assets which had never come to his hands, and never been disposed of? In whose hands are they ? Who claims them? How are the claimants of them, whether they be executors, legatees, cestui que trusts, or others, represented here ? How can a decree disposing of them be made, unless these be represented ? *And again, do not the proceedings disclose r*™ that Champion made other sales on no better authority than this ? L ' Are the creditors, if entitled at all, entitled to be paid solely out of this fund; or ought the other purchasers to contribute ? Must not the creditors then bring them in also ? It appears that Mrs. Yaughan was an obligee, and joined in the assignment, thus enabling G. L. Champion to receive funds. If, by reason of his misapplication of them, the Insurance Company are to be deprived of the bond, are they to be without a decrée against him, — or rather, ought she not to be first liable ? But she is not one of the parties, Who can make her, or any one else who has not voluntarily come in, a party, as the proceedings now stand ? Is it desirable in a Court of justice, to stick to a course of practice, whereby the justice of the case cannot be reached ?
    A cross bill was allowed because the Court being committed, and the present course not allowing of a satisfactory decision, no other means suggested itself. What other is there ? TJpon the bill filed in this case,, could any creditor obtain a decree against the plaintiffs, upon a substantive demand, distinct from the matters stated in the bill, without a cross bill? Under anything like sound practice, I apprehend not. And can a defendant obtain a decree against a co-defendant upon easier terms than against the plaintiff ? Is a co-defendant any more to be deprived of an answer to the matter laid to his charge than the plaintiff ? Is he to be surprised ? If not, how is he to be guarded against it when every thing lies in mere breath ? What is he to meet'? What witnesses is he to summon ? ■ What is he to disprove ? It is worse than this. Is it not ? If the creditors here obtain a decree upon the present proceedings, is it not asserting, not only that co-defendants can have a decree against each other, when they could not against the plaintiffs, but that one who is not a defendant at all, can have it against one of the defendants ! And all this upon mere parol 1
    ■ There is no way equal to the most regular way. None speedier — none more conducive to justice; none, on the whole, less expensive ; none in which the record can be made more effectually to carry the justification of the final judgment — none furnishing such means of correcting it, if erroneous ; and, certainly, none showing so clearly what has been decided, between whom, and who are bound or barred by the judgment. When -, parties are *asking leave to take some short cut in practice — like -* persons about to open a friendly suit, how fair they are Í What a mighty anxiety to go upon the merits ! We only want to ascertain our real rights: everything is agreed on : we understand each other: no need of blacking paper, or making up a regular record : why then load us with expense by compelling us to go by rule ? But just yield to them — give up one sound principle of law — break down one wholesome rule of practice — and see the consequences. Each is instantly tempted to take advantage of the other- — the one cheats — the other is surprised — one insists that the onus of some duty is upon his opponent — he denies and retorts — everything gets into confusion — the rules to restrain and govern them have been given up, and at length they come in at the final judgment, irritated and discontented. Nor is this all — no one can tell what that judgment should be, nor whether it will meet the merits of the cause. It is above correction if never so wrong — and, worst of all, it is ten to one, if half the parties or their privies are bound by it. And at last, the parties angered by the contest and instructed by. experience, set about a regular suit, to go over the same ground again. This is liberal practice —this is cheap litigation. It corrupts most, satisfies none, and impoverishes all.
    The Insurance Company was, by the order, allowed to be the defendant, or one of the defendants, because some one must be, and they might as well be as any others.
    It appeared also, that their right to the fund was prima facie good, and it was but right that those who would impeach it should be put to do so — that whenever the Court confirmed the sale, that of itself imparted a consideration to the bond which prima facie enured to the obligees, and that the Company holding the bond, even without an assignment, held such a right to payment as not only Equity but Law recognizes. They could have sued and collected in the name of the obligees. That, although the Court at the time of confirming the sale, ordered the fund into Court, directing a litigation for it, that did not amount to any declaration that as a condition of the confirmation to the creditors or cestui que trusts should have it. If that had been intended as a condition of the confirmation, the fund would at once have been decreed to the creditors or cestui que trusts. The terms of the order showed no such condition. Upon the terms of the order the Insurance Company might as well insist that the confirmation was *upon condition r^o9 that they should receive the money, as the creditors could. The L only condition of the confirmation was, that the money be paid in to be litigated for. The cross bill carries out that condition into practice.
    In one thing I am afraid I was wrong. I forgot to declare by the order, that for default of filing a cross bill by a given day, the Insurance Company should be at liberty to move for the dismissal of the bill;instead of declaring that in such case it should stand ipso facto dismissed.
    John C. Vaughan, Claiborne C. Vaughan and Eliza Virginia Vaughan, children of Wilie Vaughan, and creditors of his estate, called in under the order of the Court to establish their claims in this cause, appealed from the decretal order of Chancellor Johnston, ordering the bill to be dismissed nisi, on the following grounds :—
    1. Because all the proper parties are before the Court necessary to a final adjudication of the cause, and they are in this Court by virtue of its orders made in June, 1824, and June, 1825.
    2. Because, if it be necessary that another bill be filed to ascertain to whom the proceeds of the bonds should be paid, such bill should be filed by the Insurance Company.
    3. Because the orders made by this Court, at June Term, 1824, and June Term, 1825, have never been appealed from, and without such appeal, cannot now be reversed by an order of a subsequent Chancellor, overruling those orders and giving a new direction to the cause.
    4. Because it is the duty of the Insurance Company to bring George L. Champion to account; and it is their duty to show that he is in advance to the estate of Wilie Vaughan, in order to subrogate themselves to his rights, and thus establish their claim to the proceeds of the bond of the Chesnuts ; and it is not the duty of these appellants.
    5. They further appeal from the Chancellor’s decree refusing to confirm the reports made by the Commissioner at June Term, 1827, and the undated report, (of June Term, 1828,) establishing the amount due by the estate of Wilie Vaughan, to his children ; and they move to confirm said reports.
    6. And if said reports are not confirmed by this Court, they further appeal from the order refusing to grant the motion made by *Mr. Blanding for a reference, and move this Court to grant the said order. L
    The cause was argued by Mr. Wm. E. De Saussure on these grounds, before the Court of Appeals, in December, 1833, and the following judgment pronounced in that Term.
   O’Neauii, J.

• It appears that the price of the negroes bought by the plaintiffs, and belonging to the trust estate, was, on the decree confirming their title, paid into Court, “subject to the future order of the Court.” In the meantime, it was referred to the Commissioner to report upon the different claims to this fund; and a part of the order of reference directed “ that G. L. Champion account before the Commissioner for his application of the funds which came into his hands from the sale of the bond to the Insurance Company, and that the Commissioner gave notice to the creditors to come in and make their claims.” Under this part of the order, several creditors came in, established their demands, and obtained a decree directing payment. At June Term, 1825, the fund in Court, and such as might come to the Commissioner’s hands before the final report, were directed to be paid “ to the Fire and Marine Insurance Company, subject to the rights of the contesting claimants, and subject to the further order of this Court.” Since this order, the Court has done nothing further than continue the cause from term to term, under reference, until November, 1833, special Term, when the cause came on before Chancellor Johnston for trial. Two reports of the late Commissioner, establishing a large sum due by the' trust estate to John C., Claiborne C., and Eliza Virginia Vaughan, were presented for confirmation, which were resisted by the Eire and Marine Insurance Company; and the Chancellor quashed the reports, and ordered this .bill to be dismissed as to the Fire and Marine Insurance Company, unless the persons claiming the fund in opposition to the Company should file a cross bill within a limited time.

From this decree, John C., Claiborne C., and Eliza Virginia Vaughan, appeal on various grounds, which make the following questions: — 1st. Were the appellants rightly in Court, under the orders made in the cause as creditors claiming the funds ? 2d. If so, had the Chancellor a right to quash the Commissioner’s reports, and to cast upon the appellants the burden of filing a bill against the Fire and Marine Insurance Company to try the right to the said fund ?

*1. The fund in controversy came properly into the hands of the Court; for, on confirming the plaintiffs’ titles to the slaves which they had bought, it was the business of the Court to see that their price was applied to the purposes of the trust which had authorized their sale. This could not be done by leaving the fund to be paid by the Fire and Marine Insurance Company : they were not creditors of the grantor of the trusts, but of his trustee, Champion. They bought the plaintiffs’ bond from him, but the title to the negroes which he sold, and for which the bond was given, was defective, he having no power to make the sale. They could not have recovered the bond from the plaintiffs on account of this defect of title. When the Court of Equity confirmed the title, they assumed the trust, and the price was properly payable to them, as the fund applicable to the payment of the debts of Wilie Vaughan, in place of the slaves sold. The Fire and Marine Insurance Company having obtained nothing by their purchase of the bond, had a plain right to recover the amount paid by them to Champion for the bond from him ; and if they could show that he was in advance to his trust estate and was insolvent, then to take his place as a creditor of the trust, to the amount of the sum paid by them to him, if he was so far in advance to the estate; if not, to the extent he was. This is the state of the claim of the Fire and Marine Insurance Company: that it was properly before the Court is not denied. To decide whether it would entitle them exclusively to the money, three facts had still to be made out: 1. That there were no unsatisfied creditors of Wilie Vaughan. 2. That the trustee, Champion, was in advance for' the trust estate to a sum equal to the fund in dispute; and 3. That he was insolvent. — Until the first was established, the Fire and Marine Insurance Company could have no exclusive right to the whole fund. The most they could contend for, on establishing the other two facts, would be to come in rateably with the other creditors of the trust, if there were any. To ascertain whether there were any creditors, all the creditors of Wilie Yaughan were requested by notice to come in and establish their demands. All who come in under that notice are parties to the cause, and are bound by all the proceedings. The appellants, it appears, came in under the order, and have (perhaps on an ex parte reference) satisfied the Commissioner of the debt due to them by Wilie Yaughan. This made them properly parties in Court, and as much entitled to its favor as the *Fire and r#ss. Marine Insurance Company. For,- notwithstanding they are in L possession of the fund, they are in possession subject to the further order of this Court, and the appellants were moving to have it paid over to them. In such a case the Court must decide on the hostile rights of the two claimants; and to enable it to do so, it might be referred to the Commissioner to ascertain and state the facts upon which the Court is called upon to decide. In this .way, every thing would appear by the record. There is nothing irregular in such a course of proceeding. It is every day’s practice on a creditor’s bill, to bring all the creditors before the Court by a notice requiring them to come in and prove their demands. In such a case there may be hostile and conflicting claims among the creditors; upon them the Court must decide on the coming in of the Commissioher’s report. A fresh bill would hardly be required to be filed in such a case, to make the creditors, coming in under the notice, parties before the Court.

2. If the Commissioner’s reports were made up entirely on an ex parte hearing of the plaintiffs, they might have been set aside; but I have looked through the Chancellor’s report in vain to see any evidence of the fact that they were so. In the absence of proof, the legal presumption would be, that the Commissioner had done his duty and given due notice before hearing the plaintiffs. That presumption is, I think, strengthened by the entries on the dockets at June Term, 1827 and 1828. In all events, I think the Chancellor erred in quashing the reports and ordering the appellants to file the cross bill, (as he has called it). We have seen they were properly parties; and notwithstanding there had been great delay and negligence in bringing the cause to trial, it is no more to be imputed to them than it is to the other parties. If the ease presented to him did not justify him in pronouncing a final decree in favor of the appellants, he ought at least to have sent them back to the Commissioner, with instructions. Situated as the case is, I do not think that we ought to confirm the Commissioner’s reports of 1827 and 1828, and direct the fund to be paid to the appellants.

It is ordered and decreed that the order quashing the reports, and the decree of the Chancellor, be reversed: that the cause be remanded to the Circuit Court, and that the Commissioner be directed to examine and report upon the claims of the creditors of Wilie Yaughan, which have been rendered to the former Commissioner and not decreed upon ; distinguishing which debts were contracted* before and which after the execution of the deed of trust: in such investigation, the Com- ■-' missioner’s report of 1827, and the undated report, (supposed 1828,) will b % prima facie evidence of the claims of the appellants; and the Fire and Marine Insurance Company will have the right to examine and point out from the reports, or the evidence on which they were founded, any part or parts of the said claims which have been allowed improperly, and upon them the present Commissioner will decide and report: so too, they may by proof disprove the whole or any part of the said claims, and upon the proof which they may adduce, the Commissioner will decide and report.

It is also ordered and decreed, that the order of February Term, 1824, requiring Champion to account for the funds which came into his hands for the sale of the bonds he extended, and that the Commissioner do forthwith take the account ordered by it.

Johnson, J., and Harper, J.,

concurred.

• Mr. Mayrant, the counsel for the Insurance Company, being absent at the .last Term of the Court of Appeals when the foregoing opinion was delivered, by leave of the Court, at this sitting submitted the following grounds in support of the Circuit decree :

1. That the Commissioner’s reports are unaccompanied by evidence; and were-made up on ex parte hearings, as appears by the'Chancellor’s decree, and his decretal order quashing the reports ; which last recites the fact, that it did not appear that the parties had been summoned to attend the references, and which order was not before the Court at its last sitting.

2. That Mrs. Sarah Yaughan, the executrix and residuary legatee of Wilie Yaughan, was never made a party to these proceedings; and that persons claiming in opposition to.,her and to the Company should proceed by a cross bill and make her a party.

3. That the orders heretofore made suppose the Company to be prima facie entitled to the fund, and no legal or equitable demands having been established against it, the decree of the Chancellor in relation thereto was right.

*On which the Court delivered at this Term, the following judg- *-■ ment:

O’Neall, J.

At the instance of the defendant’s counsel, (who was absent at the last Term, when this cause was decided, and who it seems did not receive until after the adjournment of this Court, the notice of appeal, which had in due time been forwarded to him by mail,) we have looked into the former opinion and are perfectly satisfied with its correctness.

We did suppose from the papers before us at the last Term, that Mrs. Sarah Yaughan was regularly a party in Court. For her name is set down in the report of the cause as one of the defendants; and she appeared to the case by her counsel, Stephen D. Miller. But it seems that process of subpoena to answer was not prayed against her; and she is not therefore regularly a party in Court. This cannot, however, affect the result of this care. As executrix or residuary legatee, she has no interest in it. The contest is between creditors ; and the question is —who are entitled to a fund arising under a trust deed to which she was not a party ?

The motion is dismissed,

Johnson, J., and Harper, J., concurred.