Case ID: sc-eq_27/html/0302-01.html
Source: Caselaw Access Project
Author: {"author": "Johnston, Ch.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

John Boyce, adm'r, vs. W. W. Boyce and others.
    
    Where creditors are called in to establish their demands, and the Master’s report upon tho demands sets forth a mortgage as a valid lien upon the estate, and no exception is taken to the report, and it is confirmed, no creditor then before the Court can after-wards question the validity of the mortgage as a lien upon the estate.
    A mortgage executed and recorded in April, 1839, held to be entitled, under the Act of 1698, to priority over a mortgage executed in 1836, and recorded in June, 1840.
    Where a party has an opportunity, and does not except to tho report, he cannot again bring tho matter of the objection, either before the Master, or before the Court, on circuit, or on appeal.
    Where a party appeals in a cause, he is concluded by the appeal decree from afterwards stirring any point not covered by his appeal.
    Where a fund arising from tho rents and profits of mortgaged premises is to be applied to the debts of the decoased mortgagor, the mortgagees are entitled before the general creditors; and the oldest mortgage has the right to the first application of the fund.
    One whose possession was tortious, and who bought in a junior mortgage to sanctify his possession, held bound to pay the rents and profits to the oldest mortgage.
    One tortiously in possession held bound to account for the fair rentable income of tho property, although it amounted to more than he actually received from the tenants! and to interest upon the annual amount from the end of the year in which it became due.
    
      Before Dunkin, Oh., at Charleston, February, 1853.
    The case now came up upon the report of the Master under the order of reference made by his Honor, Chancellor Johnston, at March sittings, 1852, (vide 5 Rich. Eq. 267;) and was heard upon the following exceptions taken by Edwin P. Starr to the report: ,
    1. Because the report of the Master sets up as a prior lien to the debts claimed by this defendant, a certain mortgage, executed by the administrator to the Bank of the State; which mortgage this defendant contends can only charge the share of the administrator as one of the heirs at law, after the payment of the debts of the intestate.
    2. Because the mortgage of the intestate, duly executed to Jeannerett in his life time, although not recorded, is entitled to priority over the subsequent mortgage from one of the heirs at law to the Bank.
    
      3. Because the actual amount received for rents and profits by Mr. Starr, was proved before the Master, and this should have formed the true basis for his report, instead of the speculative and conjectural "amounts which he has reported.
    4.- Because the Master ought not to have made annual rests in the account of rents.
    5. Because the rents and profits ought to go into the hands of the administrator for the general benefit of the estate, and should not have been reported as belonging to the Bank of the State.
    6. Because, if the receipts and profits are to be applied to the mortgage debts, then the defendant, as assignee of Jeannerett’s mortgage, is entitled to the rents and profits of the lot covered by that mortgage.
    7. Because the defendant, Starr, on the 24th June, 1844, was substituted to all the rights of the Master Gray, under ’the mortgage assigned to Jennerett, and by Jennerett assigned to Starr; .and, that being in possession, under this assignment as mortgagee, he was authorised to take the rents and profits to his own use.
    8. Because the subsequent report of testimony by the Master, shews that Starr did not take possession of the premises for one year after his purchase at sheriff’s sale, and the report should be reformed by striking out the rents for that period.
    Dunkin, Ch. Robert Boyce died intestate in October, 1838. His heirs at law were his sons, John Boyce and William W. Boyce, the former of whom became administrator of his estate 23d November, 1838. The personal estate was, comparatively, inconsiderable; his real estate was valuable: consisting of the premises at the corner of King* and Society streets, called the Merchant’s Hotel, and several lots on the opposite or south side of Society street. At the period of the intestate’s death, his entire real estate was under mortgage to Ker Boyce for $26,871, with interest from 1836 ; and one of the lots on the south side of So. ciety street,, was under mortgage to Mr. E. Jeannerettfor $1,000, with interest from 17th May, 1836 — which latter mortgage was not placed on record until 25th June, 1840. These debts constituted at that time, the only liens on 4he estate, although other debts, by simple contract, existed to a considerable, amount. The buildings on the lots on the south side of Society street, were destroyed by the great fire in the Spring of 1838, and at the period of the intestate’s death, he was engaged in having them reconstructed. William W. Boyce was a minor at hisfather’s death; and in February, 1839, an application was made to this Court by John Boyce and Geo. B. Pearson, guardian of W. W. Boyce, fo have -the premises at the corner of King and Society-streets sold, and also for permission to be enabled to avail themselves of the benefit of the Fire Loan Act of Dec. 1838, in relation to the lots on the south side of Society-street, by executing a valid mortgage to the Bank of the State. On the 15th February, 1839, both these applications were granted by the de-cretal order of Chancellor Haepée. In relation to the lots on the south side of Society-street, the order is as follows : “ It is further ordered and decreed, that George B. Pearson, guardian as aforesaid, is hereby authorised, with the said John Boyce, to give such bond or bonds to the Bank of the State, as may be necessary to obtain loans from said Bank, under the Act for rebuilding the city, of Charleston, upon such lots of land of the estate, of the late Robert Boyce, as John Boyce and George B. Pearson, guardian as aforesaid, may think expedient to build upon; and that the said Geo. B. Pearson, guardian as aforesaid, may have power to mortgage said lot or lots of land with the said John Boyce, in conformity with the provisions of the aforesaid Act of Assembly, and the amendments thereto.” On the 1st April. 1839, John Boyce and. the guardian of W. W. Boyce, accordingly executed three bonds and a mortgage of the premises, on the south side of Society-street, on which loans were made to the amount of seventeen thousand dollars and upwards ; of this loan, seven thousand seven hundred and eighty dollars (7,780) were paid to Ker Boyce, who, thereupon, entered satisfaction on his mortgage, (which included the real estate on both sides of the street,) and took a new mortgage from John Boyce and George B. Pearson, of the premises on the north side, thereby to enable the Bank to have the eldest lien on the premises at the south side.
    On 2d July, 1840, John Boyce, as administrator of Robert Boyce, deceased, filed a bill for having the assets of the estate marshalled. The decree of Chancellor Wardlaw, in April, 1852, presents a succint narrative of the proceedings had under that suit, to which, for the reasons therein set forth, he held the defendant, Edwin P. Starr, to have been a party. Among other things, it appears that on the 29th January, 1841, the Master submitted his report of creditors, who had established their claims under a previous decretal order. The report was accompanied with an exhibit, setting forth the several debts and the aggregate amount; of these debts, he stated that the bond to Ker Boyce, secured by the mortgage of the Merchants’ Hotel, the fire-loan bond to the Bank of the State of South-Carolina, and the bond to James W. Gray, (Mrs. Jeannerett’s,) secured by mortgage of the lot in Society-street, amounting to $42,529 21, were entitled to priority, and that it was not probable that the assets of the estate would meet them. “ The Master concluded his report by a recommendation that the estate of Robert Boyce be sold, and the proceeds distributed in payment of his creditors, according to their legal priorities. This report was confirmed by the Court, a sale ordered, and the Master directed to apply the proceeds thereof to the payment of the creditors in the said report specified, according to the legal priority of their several and respective liens and demands.” This order is final and conclusive. The object of the proceeding now pending, is to carry into eifect the decree then made against the parties in that suit. If the defendant, Edwin P. Starr, was dissatisfied with the report of the Master, made under a decretal order, which specially required him to inquire and report, “ what liens, in whose favor, <fcc., now subsist, and are binding, &c., and in what order the creditors were entitled to be paid,” and to notify creditors who claimed a lien, to prove their debts and liens— if he was dissatisfied with the report of 29th January, 1841, made under such order, he had the opportunity then to except to said report, and the decree of confirmation is just as conclusive upon him as if he had then filed the exceptions which he now submits, and they had been overruled. The exceptions in relation to the validity and priority of the mortgages to the Bank of the State, are therefore overruled.
    By the Act of 1698, it is declared that the mortgage, &c., first recorded in the .Registers Office in Charleston, shall be taken, deemed, adjudged, allowed of, and held, to be the first mortgage, &c., and be good, firm and substantial, in all Courts of Judicature within South-Carolina. (P. L. 3.) This law was particularly recognised and enforced in Barnwell vs Por-teus, 2 Hill, Ch. 219. It was in strict accordance with this law, that the report of Jan. 1841, ranked the Fire Loan Bonds to the Bank of the State of South-Carolina, prior to the bond to James W. Gray (Jeannerett’s.) Both were secured by mortgage of the lot in Society-street. The seventh clause of the Fire Loan Act, declares that the mortgage executed by the applicant shall be a charge upon the land, in favor of the said Bank and its assigns, from the date of the registry in the office of mesne conveyance, against all persons whomsoever; and all mortgages shall be recorded or lodged in the Register’s Office for record by the applicants, before any money shall be paid by the Bank. The mortgage to the Bank of the State was recorded in April, 1839. No other incumbrance of the property was at that time on record, unsatisfied. The mortgage to James W. Gray was not placed on record until 25th June, 1840. The mortgage to the Bank of the State was then properly held and taken by the Court to be the first mortgage on the lots on the south side of Society-street, and the Bank must be considered and declared to be entitled to all the rights and privileges of the first mortgagee. In the well considered case of Matthews and Preston, (M. S. Court of Appeals, Charleston, Jan., 1852,) it was ruled that the first mortgagee, on account of the priority of his claim, has a right to the first application of the fund arising from the rents and profits of the estate. The fifth, sixth and seventh exceptions of the defendant are, therefore, overruled.
    
      The remaining exceptions of the defendant relate to the amount of rents and profits reported by the Master, and the manner in which the account is stated. The property was sold by the city sheriff, under the* execution of the defendant, E. P. Starr, or Starr and Howland, and purchased by E. P. Starr, who received a conveyance from the sheriff, on 5th July, 1842. The decrees of the Court heretofore pronounced, have declared that all those proceedings were in contempt of the Court, and that the defendant was a wrong-doer, and consequently responsible for rents and profits of the premises. In the last appeal decree, it is said to be 'not unlikely that the irregular proceedings of the defendant, in the levy and sale of July, 1842, may have created obstacles in carrying into effect the decretal order of sale, made by this Court, which did not previously exist." The defendant was considered as a trespasser, and on that footing was his accountability adjudged. By violating the order of injunction in a suit to which he was himself a party, and procuring the sheriff's conveyance of the premises, he was enabled to hold himself out as the legal owner, throw a cloud on the title, and effectually embarrass any subsequent sale under the previous orders. The Master has fixed his liability for the rent, from the date of the defendant’s conveyance, and he might have done so from the date of the levy, under the irregular execution. Then it is contended that he should only be accountable for the rents actually received. But that it is not the rule applied to a trespasser. He did not levy upon the premises, or enter as an agent; on the contrary, he was warned at the sheriff's sale not to purchase in disregard of the existing decree. He occupies the ordinary position of a defendant in an action of trespass to try title, and is liable for mesne profits from the time of his trespass by levying on the premises. If he had never received a dollar, it is irrevalent to the enquiry. The Master has come to the conclusion on the evidence, submitted to him, that nine hundred dollars a year, from the 3d July, 1842, to 6th May, 1852, with interest calculated at yearly periods, would be a just and equitable charge for the premises during this period. For the reasons stated by the Court, this appears not to be a case for an account with annual rests. That principle is applied to trustees and others, acting in a fiduciary relation. The defendant was neither the agent nor the bailiff of the complainants. He held, avowedly, on his own account, and is responsible, as if in an action at law he had interposed the plea of not guilty, or liberum tenementum, or both. The Court has reviewed and considered the evidence reported; of all the witnesses examined, Mr. Whitney is the only one who can be regarded as differing with the judgment of the Master ; and it is somewhat remarkable that this witness, in giving his testimony on the 27th Jan., 1852, says, that “the entire property would now rent at about seven hundred dollars a year — regards the full estimate of the value of the property to be seven thousand dollars.” In three months after this testimony was delivered, to wit, on the 6th May, 1852, the premises were sold by the Master for seventeen thousand two hundred dollars in cash. And on the 21st June, 1852, the two purchasers at the Master’s sale testified that they had rented out the premises to third persons for the aggregate annual rent of one thousand four hundred and sixty-five dollars.
    If the Master had fixed the clear annual value at nine hundred dollars, there is much in the testimony to warrant such a conclusion. But he has allowed the defendant, for various disbursements during the interval, the sum of one thousand and sixteen dollars and twenty-three cents, ($1,016 23,) making the clear annual value less than eight hundred dollars. The inference of the Master is then well sustained.
    But as has been intimated, the Court is of opinion, that the defendant is not liable for interest, and that the statement must in that respect be reformed. This requires no further reference nor recommitment of the report. Charging the defendant with nine hundred dollars per annum, as recommended by the Master, from 5th July, 1842, to 6th May, 1852, the aggregate sum, without interest, is eight thousand eight hundred and fifty dollars, and deducting the account for repairs, taxes and commissions, as allowed by the Master, to wit, one thousand and sixteen dollars twenty-three cents, the balance due by the defendant for rents and profits on 6th May, 1852, amounted to the sum of seven thousand eight hundred and thirty-three dollars and seventy-seven cents.
    Much was said about the defendant’s right to retain under Jeannerett’s mortgage. But this has been already disposed of in what has been said. The Bank of the State, as first mortgagee, is entitled to be first satisfied from the proceeds of the sales, and the amount due for rents and profits. According to the statement of the debt to the Bank under the Fire Loan, as presented in the report by Mr. Tupper, 8th March, 1853, the above stated sources will be insufficient to satisfy that claim.
    It is ordered and decreed, that the several exceptions to the Master’s report, with the reservation of that in relation to the annual rests, be overruled, and that the defendant, Edwin P. Starr, pay into the hands of the Master, the above stated sum of seven thousand eight hundred and thirty-three dollars and seventy-seven cents, within thirty days after notice of this decree.
    It is further ordered and decreed that, after deducting the costs accrued up to the time of filing the supplemental bill, 29th April, 1850, the Master pay over the surplus arising from the sales made by him, as well as from the amount thus directed to be paid to him, to the Bank of the State of South-Carolina, so far as the same may be necessary to satisfy the amount due to the Bank under the Fire Loan mortgage, and that the Master report whether the same is sufficient to satify the said debt; and any special matter in relation thereto.
    It is finally ordered and decreed, that the costs arising since the filing of the supplemental bill (except the costs of A. E. Carew, M. C. Mordecai and J. Cohen, who must pay their own costs) be paid by the defendant, E. P. Starr, and the Master inquire and report what would be a reasonable counsel fee to complainant’s solicitors, in the suplemental bill, to be paid by the parties declared to be entitled to the fund, with liberty to said parties to except, &c.
    The defendant, Edwin P. Starr, appealed from the circuit decree, and now moved this Court to reverse or modify the same, upon the following grounds :
    1. Because neither the validity or priority of the'mortgage of the heirs at law to the Bank of the State, was established by the former decree in the cause; nor were any of the questions arising upon the said mortgage considered, decided, or intended to be concluded.
    
      2. Because it is competent now for this Court to consider and adjudge all the questions raised by the exceptions to the Master’s report, and if well founded, they ought now to be sustained, notwithstanding the construction which is put in the decree upon the previous decrees.
    3. Because the report of the Master sets up as a prior lien to the debt claimed by this defendant, a certain mortgage, executed by the administrator to the Bank of the State; which mortgage this defendant contends can only charge the share of the administrator, as one of the heirs at law, after payment of the debts of the intestate.
    4. Because the mortgage of the intestate, duly executed to Jeannerett, in his life time, although not recorded, is entitled to priority over the subsequent mortgage, from one of the heirs at law to the Bank.
    5. Because the actual amount received for rents and profits by Mr. Starr, was proved before the Master, and this should have formed the true basis of his report, instead of the speculative and conjectural amounts which he reported.
    6. Because the rents and profits ought to go into the hands of the administrator for the general benefit of the estate, and should not have been reported as belonging to the Bank of the State.
    7. Because, if the rents and profits are to be applied to the mortgage debts, then this defendant, as assignee of Jeannerett’s mortgage, is entitled to the rents and profits of the lot covered by that mortgage.
    8. Because the defendant, Starr, on 24th June, 1844, was substituted to all the rights of the Master Gray, under the mortgage assigned to Jeannerett, and by Jeannerelt assigned to Starr; and, that being in possession under this assignment as mortgagee, he was authorised to take the rents and profits to his own use.
    9. Because the subsequent report of testimony, by the Master, shows that Starr did not take possession of the premises for one year after his purchase at sheriff’s sale, and the report should be reformed by striking out the rents for that period.
    The plaintiff also appealed on the ground:
    That so much of the decree of the Chancellor as reforms the report of the Master, in regard to interest allowed at yearly periods, on the arrears of rent with which the defendant, Starr, stands charged, should be modified so as to restore the charge of interest as set forth in the report.
    
      Cunningham, Hayne, for plaintiff.
    
      Meiwminger, for defendant, Starr.
    
      
       In Matthews vs. Preston, the opinion delivered in the Court of Appeals is as follows:
      Dahgan, Ch. At Common Law, the mortgagee was, immediately after the execution of the mortgage deed, seized of an estate in fee, and the mortgagor was considered, in the language of some of the cases, his tenant at will — (Powsley vs. Blackman, 2 Cro. 659.) It would bo a more proper expression to say, that the occupation of a mortgagor remaining in possession after the execution of the mortgage, was like that of a tenant at will: for in some respects they differed. The mortgagee was deemed the absolute legal owner: and had a right to enter, and could maintain a possessory action against the mortgagor, or any other person, except tenants who were in under leases anterior to the execution of the mortgage . If there wore covenants in the mortgage deed, by which the mortgagor was entitled to retain the possession, the Court of Equity would protect him in tho enjoyment of such right, and would enjoin any action, or other proceeding instituted by the mortgagee for his ejectment.
      Along with the legal estate, the mortgage conveyed to, and vested in the mortgagee all outstanding leases, or terms for years, attendant thereon.
        
         As long as the mortgagee, by his own non-intervention, permitted the mortgagor to receive the rents and profits, his receipts were a legal discharge to the tenants. Nor was the mortgagor liable to account to the mortgagee for the rents and profits so received by him, except upon the ground of some special agreement. But the implied authority of the mortgagor to receive, and appropriate the rents and profits, might be terminated at the will of the mortgagee. He had only to notify the tenant of his mortgage, and demand the payment of the rent to himself, (both as to that which was in arrear, and that which was to accrue,) to render any subsequent payment to the mortgagor illegal. After such notice, the mortgagee might maintain his action at law for the rent, or he might resort to the more summary proceeding by distress, under the law of landlord and tenant.
      Tho legal right which a mortgage gives to the mortgagee, to demand and receive the rents and profits as above described, appertain to the first mortgagee only, and depends upon his being considered at law the legal owner of the estate. It is obvious, that a second mortgagee can have no legal right to demand and receive rents and profits from the tenant, on the ground that the first mortgagee has the prior and the better right: and for the further reason, that the principle upon which the first mortgagee has the right to demand and receive the rents and profits, does not apply to the second. The latter has no legal estate vested in him. That is all in the first mortgagee. There remains only the equity of redemption. And the second mortgage can only be regarded at law, as an assignment of the right to redeem.
      I have adverted to these principles of tho Common Law in relation to the legal rights of mortgagors and mortgagees, for the purpose of drawing a distinction: and because! it seemed to be supposed in the argument, that they should have a striot application in this case. In a Court of Equity, independent of tho provisions of our Act of Assembly of 1791, the mortgagor is regarded as the owner of the land, even after forfeiture: and tho mortgagee is only considered in the light of a creditor, having a lien upon the land created by the mortgage, and taking effect from the date thereof,  There is no principle, therefore, upon which a first mortgagee can stand in this Court, and claim an account of the rents and profits, which will not apply with equal force to the second or any subsequent mortgagee. B.ere they all stand upon the same footing as regards ownership in the land. None are considered as having rights founded upon legal title : hut all aro alike regarded as creditors simply, having liens upon the property, and having prece-dency in payment according to their priorities. The mortgagee in this Court, claiming an account of the rents and profits, must stand upon the general doctrine laid down by Coote (on Mortgages 342) that “ although in equity the mortgagor remains the actual owner of the land until foreclosure, entitling him while in possession, to the receipt of the rents and profits without account, yet equity regarding tho landmtit all its produce as a security for tho mortgage debt, will restrict the right of ownership within those bounds, which may not operate to tho detriment or injury of the mortgagee.” This, as we have seen, is a principle, which, in this Court, operates as well for the advantage of the second mortgage as the first, with the exception, that the first mortgagee on account of the priority of his claim, has a right to the first application of the fund arising from tho rents .and profits of the estate. If the corpus of the estate is sufficient to satisfy the debt of the first mortgagee, thereby rendering him indifferent to an account for the rents and profits, the second mortgagee has a right to take his place: on the principle, that tho land and its produce stand as a security for the payment of the mortgage debts, according to the order of their dates, and what is left by the first, the second is entitled to take. There is another familiar principle of Equity Jurisprudence, on which the second mortgagee may be indirectly let in to the benefit of the rents and profits: supposing him to have no particular equity in himself. If one incumbrancer has a lien, upon two funds, while a second, has a lien upon one of those same funds, the latter may compel the former in this Court, to resort to and exhaust the fund to which he has no claim: to the end, that both may be satisfied if practicable. Thus admitting that the second mortgagee has’no right to claim an account of rents and profits: the first, under certain circumstances unquestionably, has such a right even at law: and the second may, in this Court, drive the first to resort to that fund for the exoneration of the corpus as far as it will go, for the benefit of the posterior in claim.
      The general doctrine, that a mortgagee may come into this Court, for an account of the rents and profits, is not without precedent in this State. In the case of Stoney vs. Shultz, 1 Hill, Ch. 465, it was applied in favor of the first mortgagee, but upon principles that did not discriminate between the caso of a first mortgagee, and that of a second.
      The only thing requisite to entitle the second mortgagee to this relief, is, that he should file his bill, making the mortgagor, the first mortgagee, and the tenant, parties: that he should state the relations of the various parties to the mortgaged premises: that the mortgaged premises are insufficient for his security without a resort to the rents and profits: that he should pray an injunction against the tenant paying the rents to the mortgagor : and that he should ask an account of the rents, and that they be applied according to the rights of the parties. When ho has filed a bill framed after this manner, he has stated a case which, if supported by the proof, entitles him to relief.
      I will not say, that the form of the complainants’ bill is the best that might have been adopted. But it seems to me, that as against the defendant, Emily Timbrook, (and it is her branch of the case that I am first to discuss) the complainants’ bill comes up, substantially to the above requirements.
      The defendant, Emily Timbrook, admits that she was at the time of the filing of the bill, and for some time before, a tenant of the mortgaged premises under a lease from her co-defendant, James Preston (the mortgagor). She alleges, that she had regularly paid the rent to her landlord as it fell due. Not disputing her liability to account in this Court for the rent then unpaid, or which might thereafter accrue, she prays to be exonerated as to past payments. She does not deny the charges of the complainants’ bill, that she had received formal notice as tenant of the premises in Berresford-street, that the said premises were mortgaged to the complainants: that the mortgagor was insolvent: that the mortgaged premises were an inadequate security: and that she should pay no more rent to her landlord, James Preston. As to the prayer of Emily Timbrook, to be exempt from liability in regard to the rents paid by her to her landlord, before she reooived the notice, it is to be remarked, that according to the principles which I have laid down in the preliminary discussion, she could in no event have been liable as to such payments. And in respect to the irregularity in the notice served upon her, which described the mortgaged premises as being “in Princess-street” instead of Berres-ford-street, it becomes entirely immaterial, as the decree from which this appeal has been taken, does not make her liable for any rent, except that whioh fell due, or was unpaid at the filing of the bill, and at the filing of her own answer. And surely, the bill, after she had filed her answer to it, may be regarded as a sufficient notice and demand.
      
        The Master, at a subsequent stago of the case, held his references, attended by the solicitors of the parties. And, according to a very questionable usage of recent origin, and of quite too frequent occurrence, in reporting, upon the evidence, he proceeded to consider and determine judicially, all the questions of fact and law involved in the pleadings between the parties. The question of her liability to pay tho rents into Court for the benefit of the mortgagees was decided against Emily Timbrook. In fact, I suppose, it was not at that time disputed. The Master’s report did not fix the amount of rent due by her. But ho recommended that the “ rent due be paid into Court, to be distributed according to the rights of the respective mortgagees.”
      To this report, Emily Timbrook took no exceptions. The case came before Chancellor Duniun, at Eebruary T. 1847, on the report of the Master. The report was confirmed, and thus became a decree of tho Court. In reference to the rents, the language of tho decree is as follows: “ It is further ordered and decreed, that the rents be paid into Court according to tho recommendation of the Master.” Erom this decree no appeal has been taken. And it was not until the Master submitted another report, stating the amount of the rent for which she was liable, that Emily Timbrook has started any controversy. Subsequently to the filing of her answer, she has paid rent, to the amount of $800, to her landlord, the mortgagor. Of this sum, $300 was paid after the Master’s report was made up, and the cause had been heard by the Chancellor: and $100 afterthe decree had been filed, under these ciroumstances, it is the opinion of this Court, that her liability to pay the rent into Court for the benefit of the mortgagees, is not to her an open question, and that she is precluded from raising such a question now: first, by the Master’s report to which she took no exceptions: and in the second place, by the Chancellor’s decree from which she did not appeal. It is further the opinion of this Court, that if Emily Tim-brook could now bo permitted to raise such a question, it would be adjudged against her, on the facts of the case, and the principles of law hereinbefore stated.
      The case of John Preston, the other appellant, in some points of view, stands upon a different footing. J ames Preston was seized of a lot and store on East Bay-street: these premises he mortgaged to James B. Campbell, to secure a debt due to him: which debt and mortgage were assigned by Campbell to the defendant, Willington. He afterwards mortgaged the same premises to the oomplainants, to secure a large debt due to them by bond.
      At a subsequent period, certain New York creditors of J ames Preston, recovered judgments against him in the united States Court, üpon these judgments executions were issued, and the Marshal levied on, and sold the equity of redemption of James Preston in the mortgaged premises situated upon East Bay-street. When I say the Marshal sold the equity of redemption, X speak as to the legal effect. The premises were sold subject to the prior lien of the mortgages, and the Marshal’s deed could convey only the right or interest that remained in the mortgagor: which was the equity of redemption, At this sale, John Preston was the purchaser for about $700, and took the Marshal's title. John Preston was never in tho possession of the lot on Bast Bay. After the conveyance, the mortgagor, James Preston (who was his brother) continued to occupy it as a store, as he had done before. The circumstances are, perhaps, sufficient to raise an inference, that James Preston held under, or by the consent of his brother, John Preston. Whether, if he did so hold, he was to pay any rent, or if he was to pay rent, any was actually paid, does not appear.
      I have said in my preliminary romarks upon the law applicable to tho ease, that tho mortgagor in possession, is not liable to the mortgagee on account of rents. There is no ease that goes so far; and the authorities establish a contrary doctrine. And I should have no difficulty in adopting the conclusion, that the purchaser of the equity of redemption in possession, occupies the same relations to the mortgagee, and upon the same principle, must be equally exempt. No tenancy in either case exists, or can be implied. In such a ease, the rent, as an auxiliary fund to aid in the satisfaction of the debt, is beyond the reach of the mortgagee, though his security from the corpus of the estate may be inadequate. At least it is so, in the form of proceeding which has been adopted in this ease. I will not undertake to say, that under the circumstances supposed, there might not be a remedy afforded in this Court upon a proper application. It perhaps might be attained, by an application to this Court with the proper averments, for the appointment of a receiver, to take charge of the estate, and to realise rents and profits for the benefit of the mortgagee. But this is foreign to the present inquiry.
      If the mortgagor or tho assignee of the equity of redemption have tenants in possession of the mortgaged 'premises, paying rent, such tenants may be brought into this Court, and be required to pay the accruing rents, or their rents in arrear, for the benefit of a mortgagee, whose security from the mortgaged premises is inadequate. But I am aware of no oase, nor have I beon able to find a single authority to support the proposition, that the mortgagor or the assignee of his equity of redemption is liable to account to the mortgagee for rents, in consequence of their own use and occupation of the mortgaged premises, or for rents actually received by them from their tenants before bill filed, or before notice.
      Thus the ease stood in reference to John Preston in the inception of these proceedings. I have no hesitation in saying, that he was not then liable. He was never in the actual occupation of the mortgaged premises. He was simply the purchaser of the equity of redemption, which he held by tho possession of a third person, from whom, it does not appear, that he received, or by contract was entitled to receive, rent. Is he now to be discharged from liability 1 That is the question to which I will next address myself.
      The complainants in their hill, claimed an account for the rents against John Preston on account of his alleged possesion of the mortgaged premises on East Bay-street. Tho defendant, (John Preston,) in his answer, admitted his possession, hut did not raise the question as to his liability to accountfor the rents. The Master, in his report before alluded to, speaking of the rents, recommends the rents “to bo paid into Court, to be distributed according to the rights of the respective mortgagees” and says, he assesses “ the annual rent of the store occupied by James Preston at six hundred dollars.” As the bill prayed for an account against John Preston for these very premises, the report of the Master can be construed as referring alone to tho liability of John Preston, against whom the account for rent had been prayed. To this report, the defendant, John Preston, filed many exceptions: but he filed no exception questioning in any way his liability to account for the rent found against him by tho Master, and by him recommended to be paid into Court for distribution among the mortgagees according to their respective rights. The Chancellor overruled all the exceptions of John Preston (none of which, as has been stated, related to the rent) and confirmed the report. In reference to the rents, the decree of tho Chancellor is as follows: “ it is further ordered and decreed, that the rents be paid into Court according to the recommendation of the Master.” Thus it became a decree of the Court, that John Preston should pay into Court for tho rent of the mortgaged premises on East Bay-street at tho rate of $600, per annum: to be distributed among the mortgagees according to their respective rights. Prom this decree no appeal has ever been taken.
      The case being again before the Master, (in a very irregular way I think) he submits his final report, in which he undertakes to review his own previous finding, and the previous decree of the Court: and holds that John Preston is not liable for any rent whatever. To this report, the complainants filed exceptions, the great length, and argumentative form of which preclude their insertion in this opinion. As to the point now under consideration, it is sufficient to say, that the exceptions re-assert the liability of John Preston to pay the rent.
      On this last report and the exceptions, the case came on for trial before the Chancellor at February, Term, 1850. He made a decree, in which he disposes of this question in the following manner: 11 But this question of his liability for rents, has been already adjudged against him. He filed exceptions to the Master’s report of the 17th February, 1847. One of his exceptions was, that it was not a case for an account of rents and profits. His exception was considered and overruled. Tho report was confirmed and became the decree of the Court.” The Chancellor proceeds to say, “I cannot go behind tho deoree, to consider tho questions of law ingeniously discussed by the defendant’s solicitor. They arc concluded by the decree.”
      The first circuit decree does seem to imply, that there were exceptions to tho report as to the liability of the defendant, John Preston, for rents and profits. The Chancellor, speaking of the points in cotroversy, says, “ although tho exceptions are numerous, they involve substantially but two objections, to wit, that the bill was prematurely filed, and that it was not a case for an account of rents and profits.”
      As to the last, there seems to have been a misapprehension.' Eor, on referring to the, original exceptions, which are now before me, it clearly appears, that no exceptions to the report were taken by the defendant, John Preston, as to his liability for rent. I take it to be one of the plainest rules of practice, that where a case is heard upon the Master’s report, a party cannot question any part of the report, to which he has not filed exceptions. The rest of the report is admitted. It goes against him by default. The Chancellor will consider no question outside of the exceptions. Nor can an appeal be taken from a Chancellor’s decree, confirming a report, or parts of a report, to which no exceptions have been taken.
      But, suppose, that in this instance, the exceptions made on this appeal had been taken. The first circuit decree did, unquestionably, confirm the whole of the report. And the Chancellor who made the second cirouit decree, in conformity to a rule founded upon both comity and policy, refused to oonsider as open questions, all the matters adjudged in the decree of his predecessor. Certainly there was no error in this. Is there nothing to be considered as settled by a circuit deoree 1 Is a party entitled to go back, and try over again, the matters therein adjudged, every time he has, or supposes he has, a new illumination'? when can a cause in Equity be brought to a conclusion, if all the previous orders and decrees made in its progressive stages, are to be considered re-examinable, every time the case comes up on the circuit 1 The rule is, that all previous orders and decrees, except those that are administrative, are binding upon the Circuit'Court, and are not open for consideration except by way of appeal. If then, this defendant had in fact filed exceptions to the Master’s report as to the question of rent, (which it seems he did not,) his complaint should have been against the first cirouit deoree, andnot against the last, which professed to earry out the first. But this appeal has not been taken from the first circuit decree, but from the last, in which there is no error. Nor was there any error in the first decree : in as much as it confirmed the Master’s report, to which no exception was taken as to the point now controverted. The opinion of this Court is, that the defendant, John Preston, is oonoluded by the course which the ease has taken.
      The Master, under some supposed duty, imposed upon him by the first circuit decree, for the purpose of collecting the rent adjudged to be due by John Preston, proceeded to levy a warrant of distress upon a small stock of goods that were found in the store upon East Bay. The defendant, not admitting the right of the Master to distrain upon the goods, agreed to pay the estimated value of the goods, with the understanding, that the fund thenoe arising should abide the further order of the Court. The estimated value of the goods amounting to upwards of S>300 has been paid to the Master. In accounting for the rents, John Preston is entitled to oredit for this sum. And the Master, in stating the accounts, wilt allow this credit. The Master will proceed to state the accounts in accordance with the circuit decrees.
      It is ordered and decreed, that the circuit decree he affirmed, and that the appeal bo dismissed.
      Johnston, Dunicin and Wabdiaw, CC. concurred.
      
        Appeal dismissed.
      
    
    
      
      
         Powell on Mortg. 207.
    
    
      
      
         Moss vs. Gallimore, Doug. 279; Barden vs. Thayer, 3 Mete. 79; 4 Kent, 165; Alchrone vs. Gomme, 2 Bing. 54.
    
    
      
      
         4 Kent, 158, etseq.
    
    
      
      
        Colman vs. Duke of St. Abans, 3 Ves. 25 ; Ex parte Wilson, 2 Ves. and B. 252.
    
   The opinion of the Court was delivered by

Johnston, Ch.

No other defendant than E. P. Starr has excepted to the Commissioner’s report, or appealed from the decree pronounced by the Chancellor upon it: and, therefore, this Court can take notice of no other defendant’s case.

The first and second grounds of Mr. Starr’s appeal present the question, whether the Chancellor was mistaken when he adjudged that the previous proceedings established the priority of the Bank’s mortgage over Mr. Starr as general creditor of Robt. Boyce and as assignee of Jeannerett’s mortgage; and, if so, whether it is not competent for the Court, in this stage of the suit, to re-examine and re-adjudicate that matter.

If the proceedings, referred to, do establish the priority of the Bank’s mortgage ; and if, according to the practice of the Court, this point is not, now, open to re-examination, it will be unnecessary to consider the 3rd and 4th grounds of appeal, corresponding to the 1st and 2nd exceptions to the report.

If we examine the bill filed the 2d July, 1840, we shall find that it states minutely all the circumstances relating to the death of the intestate, his great indebtedness, the application to the Court for leave to mortgage a portion of the real estate to the Bank, for a loan, the purposes, beneficial to the estate and its creditors to which the loan had been applied, &c., and submits the estate, thus circumstanced, as a fund for creditors and claimants — who were accordingly called in, agreeably to the practice in this State, to present their demands and adjust the order in which they were to be satisfied.

It appears that many creditors came in and rendered their demands ; but it is only material to notice that among them was Mr. Starr, claiming then as a general creditor, and that among the liens presented were the mortgages of Ker Boyce, the Bank, and Jeannerett, (since purchased by Starr.) See Mr. Laurens’s report 29th Jan. 1841, and schedule attached.

This report, which gave the priority to the three mortgages, over all other claims, (without deciding the priority among the mortgages themselves) was confirmed. Indeed there was no exception taken to it. This certainly was enough to conclude Mr. Starr as to the demand he then held as general creditor. He did not except to the report; or if he had done so, the order of confirmation was an overruling of his exception.

Moreover, if I were now considering his third ground of appeal, I should hold that it was concluded by this order of confirmation. For let it be granted that a mortgage by the heirs, within the nine months following the intestate’s death, during which his creditors are restrained from suing the administrator, is not an incumbrance which can displace the creditor’s right to be paid out of the land thus mortgaged: was not the report of the Commissioner, giving full effect to the mortgage over the intestate’s creditors, subject to Mr. Starr’s exception ? and why did he not except?

But there is something in the order confirming this report, which goes still further. Mr. Starr, as I have said, was a party representing his demand as a general creditor, and was there-foreconcluded by his silence from afterwardscontesting either the legality or the priority of the Bank’s mortgage. Upon the same principle, the then holder of Jeannerett’s mortgage, also present, having acquiesced in the report setting forth the mortgage of the Bank as a lien on the real estate, was concluded from afterwards contesting its validity, or objecting that it was not a lien and among the preferable liens on that estate. I do not say, now, that he acquiesced in allowing it expressly a priority over his own mortgage. That is a distinct consideration. But the fact of its validity and of its general efficacy as a lien on the intestate’s real estate, and the further fact that among all the claims it stood among the three foremost,' — these points are certainly settled by the report and the order confirming it.

Then the enquiry presents itself, What is the order of legal priority established by law, between Jeannerett’s mortgage and the mortgage of the Bank, both admitted to be valid, and both admitted to be liens on the real estate of Robert Boyce? What is it? Can there be any other answer than that given by the Statute of 1698 — that that mortgage of the same property is to be preferred which is first registered ?

There are, throughout the whole proceedings, numberless other evidences that this mortgage of the Bank was considered by every party, by the Masters and by the Court, as second only to Ker Boyce’s mortgage, which was the oldest and first recorded. But as the exhibition of these evidences would involve the labour of selecting and bringing together many passages, and would protract my observations to a length that I would avoid, I content myself with what I have said.

I turn, then, to the enquiry, whether the matters thus closed by the acquiescence of parties could be opened at any future stage of the proceedings, or can be now re-examined.

The observations of Spencer, J. in Wilkes vs. Rogers, are very sound and instructive. “ Exceptions,” says he, “ partake of the nature of special demurrers : and if reports are erroneous, the party must put his finger on the error. When he does so, the parts not excepted to are admitted to be correct; not only as it regards the principles, but as relates to the evidence on which they are founded. It is my opinion that the Court of Chancery cannot set aside a report upon exceptions not taken, and require further proof, where parties whose interests would excite them to make every possible objection, are satisfied.”

We have numberless adjudications that where a party has had an opportunity to except, and has not excepted, he cannot again bring the matter of the objection either before the Master or before the Court, on circuit or on appeal. The principle is essential to the due and orderly administration of justice; and must have a place in every well constituted forum. If at law, a party pleads to special points, neglecting other points, he acquiesces in the pleading of his opponent, relating to these points which he does not contest; and so here, and everywhere.

We have other cases to the effect that if a party appeals he is concluded from considering points not covered by his appeal: and after the appellate judgment is delivered upon the points to which the appeal refers, he is not at liberty, afterwards, in any future proceeding in the cause, either on circuit or in the Appeal Court, to claim a consideration of the ground he has passed over and lost. See the opinion of Chancellor Harper in Britton vs. Johnson . A party who brings up a partial appeal, loses every ground of appeal then existing, which he neglects and leaves behind him; and cannot afterwards stir the objections thus lost by his supineness or acquiescence. When the decrees pronounced by my brother Wardlaw and myself were appealed from, everything behind them to which the appealing parties have objected should have been brought up with them; and if the party had not objected, and so had no ground for appeal then, he has no greater ground now.

It is lamentable that the decision of Price vs. Nesbitt, so often quoted, was ever made. It has been a source of annoyance ever since it was pronounced. It seems that no amount of explanation or repudiation can prevent its being cited as authority. Seventeen years ago, enough was said in Britton vs. Johnson to prevent any further recurrence to it. All other means failing, I am prepared to expressly overrule it.

But if we could re-examine the point touching the priority of the Bank’s mortgage, what possible objection could be made to it ? If the loan obtained by the heirs of Boyce upon this mortgage had been put in their own pockets, the creditors of Boyce might have complained of the incumbrance created by the heirs. But ,$7,000 of the money went to the extinguishment of Ker Boyce’s mortgage which is admitted to be the first lien on the estate. Surely the Bank is entitled to stand in his place, to that extent. The residue of the loan was expended in erecting buildings upon the premises in lieu of building consumed by the fire of April, 1838, in the lifetime of the intestate. It is not pretended that the sum thus expended did not add an equivalent value to the premises, when subsequently sold. Who then is entitled to the amount which the buildings thus erected added to the premises'? Surely he who created the property out of his funds; and not creditors who are not prejudiced by it.

We come now to enquire whether the report and decree are erroneous, upon the subject of rent.

The points are settled, by previous decisions in the case, that Starr was a party to the suit at the time of his purchase in 1842; and that his purchase was impeachable, and made in contempt: and his purchase was set aside. While in possession, he endeavored to fortify his right to retain the property thus obtained, by purchasing in Jeannerett’s mortgage.

If in fact that mortgage had been the oldest and best, I should have hesitated to allow him any advantages arising from its acquisition under the circumstances. But being not the best mortgage, the decision in Matthews vs. Preston is conclusive, that the rents must go to the mortgage of the Bank, which is better.

To say, (as one of the grounds of appeal has it,) that as assignee of Jeannerett’s mortgage, he was mortgagee in possession, and entitled, as such, to take the rents, is to forget that he was in possession as tortfeasor, and only got in this mortgage to sanctify his possession, and that the Court, in turning him out, declared his conduct tortious throughout, and that his possession was not the possession of a mortgagee.

One of the grounds of appeal insists that he did not get possession, nor obtain rent, until one year after his purchase, and should not have been charged the rent of that year. If the fact were as stated, the inference drawn from it does not follow. Nor does it follow that because he has returned all the rent he could get from his tenants, therefore he should not account for the fair rentable income of the property. The property was in the custody of the Court, and he by his interference to the prejudice of his co-parties to the suit, may have put it out of his power for a considerable time to procure an attornment from the tenants in possession; and it may be that he could not get the attornment from some of them without reduciug their rent to a nominal sum. This is the complexion of the evidence. Shall he therefore be excused from answering for the rent that could have been obtained, but for his interference ?

The Court is of opinion that, upon all points made by Mr. Starr, the decree must stand.

But upon the ground taken on the other side, we are of a different opinion. If rent had been received from regular tenants, it would have been charged, according to the familiar practice, with interest from the end of the year in which it was received. It is the opinion of the Court that it should have been so charged in this case. The Court might, in its discretion, go further, and, upon the principle in Schieffelin vs. Stew art, have charged him with annual or even semi-annual rests. A trustee, or quasi trustee, who takes the trust property to himself for his own advantage, may be thus treated. Mr. Starr took possession of property in this Court as a trust fund for the payment of creditors before the Court', lie being one of them, and is entitled to little indulgence. But we are not disposed to press him too far. We adjudge him liable to. pay simple interest on the rents of each year, from the end of the year: and excuse him from liability to have the interest compounded. If it is compounded in the report, that must be corrected.

It is ordered that the decree be modified by sustaining the plaintiff’s exception, as just explained, and that in all other respects it be affirmed, and the appeal dismissed.

Dunkin and Wardlaw, CC., concurred.

Decree modified. 
      
       6 Johns. R. 591.
     
      
       Dud. Eq. 28.
     
      
       1 Johns. Ch. 620.