#### Levi F. Rhame *vs.*William Lewis, John R. Pollard and others.

*Assets, what are*— Power *of administrator to sell or*pledge— *Cannot sell chattels without leave*— May *sell or pledge choses in action, bona fide, without leave*— Purchaser *talcing with notice of intended misapplication cannot hold against creditors and distributees*— -Surety *on administration bond, his rights*— Case *overruled.*

An administrator, who held single bills, which he had taken for chattels of his intestate sold by him by leave of the Ordinary, and which, on their face, were payable to him as *administrator,*wishing to raise money for his private purposes, purchased negroes on credit, intending to sell them for *270cash, and in that way raise the money he wanted, and, to induce P to become his surety for the purchase-money of the negroes, offered to transfer the single bills to him as -indemnity, representing that they were his own property, that he was in advance to his intestate’s estate, and that when it was wound up the distributees would be in debt to him. P became his surety on the terms proposed, and the single bills were transferred to him. It turned out that, instead of being in advance, the administrator was at the time largely indebted to his intestate’s estate, and a decree was shortly afterwards rendered against him for a large balance due the distributees : *Held,*that the single bills were, in P’s hands, unadministered assets of the estate of the intestate, and that P could not hold them, nor any money he had collected on them; as against a surety on the administration bond for whose indemnity it was necessary that they should be restored to the estate.

No valid alienation of an intestate’s personal chattels, or visible effects, can be made by an administrator without a previous order of the Court of Equity or Ordinary.

A valid alienation by way either of sale or pledge of the ehoses in action belonging to the intestate estate may be made by the administrator of his own motion, to any one who takes them *bona fide*and for full value, not grossly inadequate, and upon *such*alienation will be discharged of all equities which attach upon them merely as assets.

An appropriation by an administrator of the assets of his intestate to his own private use is, *prima facie,*a breach of trust, and a fraud upon the rights of those interested in the estate, and he who, knowing the purpose of the administrator so to appropriate them, purchases them from him, or advances him money upon their pledge, whereby the fraud is actually consummated, takes them *mala fide.*

The securities taken by an administrator at a sale by him of the intestate’s estate, for the assets sold, payable to himself, are equally, with the ehoses in action which the intestate held at his death, under the protection of this restriction on his power of alienation.

The creditors and distributees of the intestate have an equity, as against the administrator, that the assets shall be applied exclusively to the purposes of the administration, which in the Court of Equity will be specifically enforced when necessary for their protection, and this equity follows the assets, or their value, into the hands of any one who takes them from the administrator *mala fide,*or without valuable consideration.

The surety of an administrator who has been compelled to answer to the creditors and distributees, or either, for the default of the administrator resulting from his misapplication of the assets, is entitled to be subrogated to this equity, and have it enforced, for his indemnity, against one who has knowingly contributed to the default, by taking from the administrator the .assets *mala fide,*or without value.

When once it appears that the purchaser, *&c.,*knew that the administrator was applying the assets to his own use, he is *prima facie*concurring in a breach of his trust and a fraud upon the creditors and distributees, and if *271there is any thing in tie facts which justifies such a use of the assets, the burden is on such purchaser, <fec., to show it. He takes the risk of the truth of any representations made by the administrator of the existence of such facts, and if those representations prove false, he must bear the consequence's.

The *ratio clecidendi*of the judgment in *Thacltum*vs. Longworth, 2 Hill Cb. 267, to wit, that 'an executor, or administrator, accounts, not for the moneys collected by him from time to time on the securities taken at a sale on credit of his decedent’s estate, but for the amount of the sale-bill as so much cash received at the time of the sale, being no longer, if it ever was, the rule, the decision itself is not evidence of what the law now is; and the case is overruled.

BEFORE GARROLL, OH., AT SUMTER, JUNE, 1866.

Leonard White, being in his lifetime and at the time of his death seized and possessed of a large estate, real and personal, died intestate in May, 1853, leaving as his heirs and distributees his son, William N. White, his daughter, Mrs. Bartlett, wife of the Rev. J. L. Bartlett, and ten grandchildren, issue of his pre-deceased daughter, Mrs. Dick, who had been the wife of Thomas M. Dick. The defendant, William Lewis, soon afterwards administered on the personal estate, and the plaintiff, Levi F. Rhame, and two others became the sureties on his administration bond, which, as Lewis was Ordinary of the district, was taken by the Clerk of the Court. In December of the same year, Lewis, by leave of the Clerk acting as Ordinary, sold the personal estate, on a credit of one year, for the aggregate sum of about $64,000. Thomas M. Dick was a purchaser at the sale to the amount of $10,275, to secure the payment of which he gave his three single bills, with Robert J. Dick, one of the intestate’s grandchildren, as his surety. They all bore date April 20th, 1854, and were made payable, “ on or before the 26th December next,” to *“*William Lewis, administrator of the estate of Leonard White, deceased,” “ with interest from the 26th December last.” In April, 1854, Bartlett and wife filed a bill for partition and account *272against Lewis, making William N. White and the Dicks, most of whom were infants, parties defendants. Some inconsiderable payments were made to Lewis on the three single bills of Thomas .M. Dick before January, 1859, at which time he, Lewis, pledged or transferred them to the defendant, John E. Pollard, for the consideration and under the circumstances, as stated by Pollard in his answer, as follows:

“ Some time anterior to January, 1859, William Lewis called upon him, near his residence, at Providence, and represented that he desired to raise money, but that he could not borrow it out of the banks, and had tried private individuals and could not get it, and he said his plans were to purchase negroes on credit at some estate sales, which were to take place in January ensuing, and send them to the West and sell them for cash, and solicited this respondent to go his security, and said that he had certain notes on the late Thomas M. Dick and Eobert J. Dick, for about twelve thousand dollars, and that he would place them in respondent’s hands as indemnity, and that respondent could have these notes collected and applied to the payment and discharge of the proposed purchases before' they became due, and if there should be any amount over it should be returned to him, Lewis ; and this respondent, having full faith in the representations of the said Lewis, and no notice of insolvency, either individually or as administrator, assented to go his security upon the proposed purchases; at this interview the notes referred to were not produced.

" At a subsequent day, after the purchases were made, Lewis called again upon this respondent and produced the three notes of Thomas M. Dick and Eobert J. Dick, set forth in complainant’s bill of complaint, and mentioned that he had made such large payments to the distributees of Leonard White out of his own funds, that when the estate was wound up the distributees would fall in debt to *273him. Lewis then delivered the three notes to this respondent, and this respondent signed with him a bond to John J. Ingram, administrator, of S. E. Plowden, conditioned for the payment of five thousand and six hundred dollars; and likewise signed a promissory note to Thomas H. Connors, administrator of E. S. Connors, for four thousand and thirty dollars. This respondent had, anterior to this interview last recited, and subsequent to the first interview, in which Lewis had explained> his plans and intentions, signed another note with Lewis, (under the recited arrangement,) to Isaac N. Lenoir, for two thousand and five hundred dollars.

“William Lewis then told this respondent that at some • subsequent day he would take a receipt for the notes of thé Messrs. Dicks, when he, respondent, should visit the town of Sumter. And this respondent alleges that, on a subsequent day, he thinks some time in the month of February afterwards, he called at the office of William Lewis, and he, Lewis, wrote out a receipt for him to sign, which he did, and left the same with him, Lewis; that he has applied to Lewis for the production of that receipt, and to obtain a copy; that he has not obtained a copy, as Lewis alleges that he has searched through all his papers and cannot find it, but' this defendant is assured, from his recollection, that it was to the effect as follows: ‘ Received of William Lewis two notes on Thomas M. Dick and Robert J. Dick, for two thousand five hundred and seventy-two dollars each, and one note on same for five thousand dollars, with credits indorsed of about three thousand dollars — the same are to be applied, when collected, to one note to Isaac N. Lenoir for about two thousand dollars, to one note to the administrator of Connors for about four thousand dollars, and to a bond to Ingram, executor of Plowden, for between four and five thousand dollars. The above notes and bond due by William Lewis, with John R. Pollard security.’ That *274this deponent was, at the time of receiving the notes from Lewis, and for three years anterior, and to the present time, deprived of. eyesight sufficient for the perusal of any document .either printed or written, and in all transactions involving writing has to rely upon the fidelity of those with whom he deals.”

After Pollard received the.single bills, payments thereon, to a large amount in the, aggregate, were-made to. his attorney, in whose hands he had placed them for collection-,'and, at November Term, 1860, of the Law. Court for Sumter, separate judgments for the balance due, then amounting to $3,944.82, were recovered in the name of William Lewis “ for another,” against William Edward Dick, administrator of Thomas M. Dick, deceased, and Robert J. Dick, and shortly after the recovery a further payment of $1,134.38 was made on the judgments to the attorney of Pollard. All these payments,-with the exception of a small amount which Lewis got, were immediately applied to the demands of Ingram, Connors and Lenoir, mentioned in the above extract from Pollard’s answer.

Under the bill of Bartlett and wife against Lewis and others, the final accounting took place in 1860. The Commissioner’s report showed that there was a balance due by the administrator, on the 1st January, 1854, of over $2,600 ; that the annual balances afterwards were always against him — -no one being ever less than $6,000; that the balance against him on 1st January, 1858, was $6,601.52; that the amounts received by and charged against him during that year were, in the aggregate, $18,252.17 ; that the balance against him on the 1st January, 1859, was $18,684.74 ; that he afterwards paid,out $3,526.17 and received $219.27; and that, after deducting his commissions, there was due by him on his accounts on the 30th May, 1860, the sum of $16,086.27, of which $1,733.04 were applicable to three unsatisfied judgments against him, as administrator, in favor *275of certain creditors of the intestate, leaving a balance of $14,533.23 in favor of the distributees. Exceptions were taken to the report by Lewis, but they were overruled and the report confirmed, on tbe 18th October, 1860, by a decree of bis Honor, Chancellor Inglis.

At Spring Term, 1861, of the Law Court, an action was commenced on the administration bond against tbe plaintiff, Rbame, to recover from him the amount due tbe distributees on the report of tbe Commissioner; and on the 2d April, 1862, this bill was filed setting forth the facts, substantially, as above stated, alleging that at the time of the said arrangement Lewis was embarrassed and straightened in bis circumstances, oppressed with a large load of debt, and without tbe ability and means of paying, and that this was well known to Pollard, who, with notice that said single bills were held by Lewis, as administrator of Leonard White, and of right should be applied, as assets of bis estate in tbe bands of tbe said administrator, for tbe benefit of, and distribution among, tbe distributees of White, and who bad paid no money, or other value, for tbe same, and never paid any thing as surety for tbe said Lewis, except what be may have paid out of tbe money received on the said bills, combined and confederated with tbe said Lewis to convert them to a purpose foreign from bis trust and to their personal advantage and benefit; to the prejudice of the rights and equities of tbe distributees and creditors of White, and against tbe rights and equities of the plaintiff as a surety on tbe said administration bond; and praying, in substance, for an injunction to restrain tbe collection by Pollard, and payment to him, of tbe balance due on tbe judgments aforesaid ; that Pollard may be decreed to account for the moneys collected by, or for him, on the said single bills; that said judgments and moneys may be declared to be unad-ministered assets of tbe estate of the .intestate, and be now. *276applied, under the order of the Court, in due course of administration.

On the 2d June, 1862, the defendants, Lewis and Pollard, filed separate answers. The facts, as hereinbefore stated, ' were admitted, except the allegation in reference to Lewis’ insolvency. Pollard’s account of the circumstances under which he got possession of the single bills has been already stated. Lewis’ account of the same transaction, as given in his answer, is as follows: After stating that Pollard became his surety to Ingram, Connors and Lenoir, as stated by Pollard in his answer, he proceeded as follows.: “Previous to said suretyship this defendant promised the said Pollard to transfer to him the three single bills of T. M. Dick and R. J. Dick, set forth in the said bill, to indemnify him, the said Pollard, against all loss as such surety; that he then exhibited to the said Pollard a full statement in writing of his account as administrator of the estate of Leonard White, by which he showed that the indebtedness of W. N. White and others of the distributees to him as administrator, over and above the said three bills, was amply sufficient to meet the liabilities of this defendant to the other distributees of said estate; that this defendant ’ had paid with his own proper funds over seven thousand dollars .for said estate, and that this amount, together with his commissions, entitled him to the use of the said three bills as his own proper goods; that he had shown said-statement of his account to some of the distributees, who appeared satisfied that the same was correct; all of which.facts he communicated to the said Pollard. And this defendant was then, and still is, satisfied and fully assured, that the account then exhibited to the said Pollard, and since exhibited before the Commissioner of this Court, and forming part of the brief in the suit referred to in said bill, is substantially correct and proper, and the only just and equitable mode of settlement of said estate. That on the day of *277February, A. D. 1859, this defendant, in pursuance of said promise, did assign and transfer the said three bills to the said Pollard for the purpose above set forth. That it is true the said Pollard received through his attorney all the payments made on said bills on and after 27th December, 1859, as also the payment made on said judgment, and applied the same to the extinguishment of the obligations of this defendant to Ingram, Connors and Lenoir, on which the said Pollard was surety. It is true that at the time of said transfer this defendant was involved with heavy debt, but he hoped and believed, and still hopes and believes, not without the means, however, of satisfying the same.”

At the trial, the plaintiff gave in evidence the administration bond — the inventory and sale-bill — the writ against the plaintiff on the administration bond — the record in Bartlett and wife against Lewis and others — a judgment by confession, and *fi. fa.*thereon, entered in March, 1855, of Jabez Norton against William Lewis, for $8,280, with interest from 20th May, 1854, payable annually, which was still unsatisfied — a list of one hundred and twenty-nine judgments at law, (verified by the clerk,) the Norton judgment being one of them, which had been entered against Lewis between the years 1847 and 1861, and proved by the Commissioner payment by Nhame, in 1863, of the decree, in favor of the distributees, in Bartlett -and wife against Lewis and others.

For the defendants it was shown, that the debt due Norton was for the purchase-money of land, and that he (Norton) held a mortgage of the land from Lewis to secure its payment. They further proved that, in January, 1859, Lewis gave a promissory note, for $14,000, to O. M. Crane, and a mortgage of six hundred acres of land and twenty-one negroes, to secure its payment; that, in October, 1860, Lewis gave his bond, with eleven sureties, to Crane, for the same *278debt, and^that Crane thereupon assigned the note and mortgage to them, as indemnity;1'

Lewis was a harness-maker by trade. ' In 1836, he "was elected Ordinary of Sumter District, and he continued' to hold that office until 1860. A witness testified, that he'was poor when first elected. Upon the question as to his insolvency, a number of witnesses was examined on both sides. Some testified that, as early as 1858, they regarded him as insolvent; others said they did not so regard him until 1860, when the decree in Bartlett and wife against him was rendered. Thomas D. Frierson, who had been Sheriff of Sumter District from 1856 to 1860, said he had known Lewis since 1837; there were a great number of executions of large amount against him in the Sheriff’s office during witness’ term of office; Lewis was greatly involved, and witness considered him insolvent; thinks there is no question now of his insolvency; he owns a tract of land, said to be mortgaged fora large sum. J. M. Wilder, the present Sheriff) said: there are thirty odd executions, now in the Sheriff’s office, against Lewis; some few of them are satisfied; a large number unsatisfied still. J. W. Stuckey, tax-collector, said: according to the tax returns, Lewis was the owner of seventy or seventy-five negroes and a large body of land. O. M. Crane said, in 1858, he (witness) purchased from Lewis the three single bills mentioned in the bill. In January, 1859, by arrangement with Lewis, he gave them up to him, and took from him his individual note, secured by a mortgage of twenty-one negroes and six hundred acres of land, being all the property “ Lewis was supposed to own. He had in possession other negroes, some belonging to his wife, and some to his children.” The Norton debt witness understood to be secured by a mortgage of another tract of land, being the land for which the debt was contracted, and the security was supposed to be ample. “In October, 1860, Lewis tendered to witness the *279bond of himself and eleven sureties offered in evidence, for above debt, payable in five years, he (witness) agreeing with sureties- that he would transfer to them the note and mortgage first mentioned, and,- as to such sureties, remove all liens on the ■ property- of "Wm. Lewis older than the mortgage, except the-judgment of Jabez Norton *vs:*W. Lewis. He (witness) did make a thorough examination of the office, and found all liens of said Lewis, prior to the mortgage, satisfied, except $13,000 of judgments and the Norton debt. Of this amount Lewis paid $5,000, and witness paid the balance, amounting to $8,000, which he kept open for his benefit, and still holds open against all persons except the said sureties. Witness then took the bond of Lewis and eleven sureties, and assigned to them the note and mortgage of Lewis first mentioned. The three single bills of T. M. Dick and R. J. Dick were returned by witness to Lewis because of the trusts appearing on the face of them, witness being doubtful as to Lewis’ right to transfer them.”

Wm. Lewis, defendant, said, the bond and two notes, signed by himself and Pollard as his surety, were for purchase of negroes, and the purchases were made with a view to raise money. These securities, bond and notes, are exhibited in Pollard’s answer. Witness told Pollard before he signed as his surety that the notes transferred to him by witness were his property; that he had shown his accounts to some of the distributees, (Bartlett and Dick among them,) and they were satisfied with his statement and showing. Witness still believes that he owes nothing upon his administration of White’s estate. There were three sets of distributees: Bartlett, W. Ed. Dick, White. Witness also exhibited his account, before securities were signed by Pollard, to the latter. The sum found due, by Commissioner’s report, destroyed witness’ credit. When witness gave bond to Crane, he could have given bond for $50,000, and given one hundred of best men as his sureties. Pollard *280was his surety upon one of his official bonds. Pollard was quite infirm for several.years before the war.

*Cross-examined.*Some of the Dicks interested were minors. Account shown by witness to distributees was a statement. Witness kept no books, but made returns. After report of Commissioner was made, time was allowed witness to point out errors. Witness’ scheme was to raise money by buying negroes and selling them again. Witness wanted money for various purposes, among them on account of Leonard White’s estate.

Evidence was also introduced, on behalf of defendant, Pollard, to the effect that he was old and infirm; that he was now entirely blind; that he commenced losing his sight about 1858; though his signature to the securities given in January, 1859, was about as good as it ever had been ; and that for some time before 1860, and since, he had remained much at home.

The decree of his Honor, the Chancellor, is as follows:

Carroll, Ch. At the common law the assets of a deceased person, in the absence of fraud, might be disposed of absolutely by his executor, or administrator, and could not be followed by creditors, legatees, or next of kin, into the hands of the alienee. The legal representative of the decedent is not *&*trustee technically. Ordinarily, at law, there is no direct trust affecting the assets, specifically at least, or imposing any lien upon them. Adams Eq. 251. In this respect it is said “ that there is a manifest difference between the case of an ordinary trust, where notice takes away the protection of a *bona fide*purchase from the party, and this peculiar sort of trust mixed up in some measure with general ownership.” 1 Story Eq. § 580. The ample powers of disposition, thus confided to an executor, or administrator, over the personal estate of the decedent, seem to be required by the very nature of his office and the *281duties attached to it. He is bound primarily to satisfy all just debts and charges out of the estate in his custody; a duty which he could not perform, if purchasers or mortgagees of the assets were not' protected from an “ after-reckoning,” at the instance of creditors or other parties interested in the estate. “ It is of great consequence,” says Lord Thurlow, “ that no rule should be laid down which may impede executors in their administration, or render their disposition of the testator’s effects unsafe or uncertain to a purchaser.” *Scott*vs. *Tyler,*2 Dick. 275. The doctrine of the Court seems to be that a mere secret intention of the executor to misapply the funds, unknown to the other party dealing with him, or a subsequent unconnected misapplication of them, will not affect the purchaser. He must be cognizant of such intention, and designedly aid or assist in its execution. 1 Story, § 580, and authorities cited.

That the party dealing with the executor, or administrator, has knowledge or notice of his intended misapplication of the assets, may be shown, however, otherwise than by direct and positive proof. It may be brought home to him by the very nature of the transaction between them. This is illustrated most frequently by the class of cases in which an executor, or administrator, disposes of the assets in his charge for the satisfaction of his individual debt. It may well be doubted whether the decisions referred to are applicable to the present case. They relate to transactions involving the extinguishment of a precedent debt, not the creation of a new one; to dealings in which the executor, or administrator, parts with the assets, for the purpose of satisfying an antecedent debt of his own, and receives no other or further consideration whatever, where all that is done is payment on the one side and receipt on the other. Such is not the character of the transaction between the administrator, ¥m. Lewis, and his co-defendant, John R. Pollard, which is here sought to be impeached,

*282The obligations in writing or single bills of Thomas M. and Eobert J. Dick were transferred and pledged by Lewis to Pollard, as counter security against the liability, as surety of Lewis upon Ms obligation and notes to John J. Ingram and others, the vendors, for the price of certain negro slaves sold to him. It will be assumed that if the pledge or transfer of the obligations of Thomas M. and Eobert J. Dick would have been valid, had it been made directly to the vendors of the negro slaves, as security for the purchase-money, so also must it be held valid when made to Pollard, as indemnity against his liability as surety for the same debt. A pledge by an executor, or administrator,-of any part of the personal assets, for- money advanced at the time, if no more appears, will be sustained, because such pledge is *prima facie*consistent with his duties. *Kane*vs. *Roberts, 4:*Mad. 357; 1 Story, § 581. But suppose, instead of receiving money, the executor, or administrator, accept as an equivalent, and at a fair valuation, visible chattels, readily convertible into money, declaring at the time his purpose to sell them for cash, and afterwards actually so disposing of them. The real nature of the transaction, it is apprehended, would not be varied by this modification. The purpose of the executor, or administrator, in either case, is the same — ■ to raise money — and to accomplish it in both and substantially by the same means, directly in the one case, indirectly in the other. The actual results of the transaction are, that Lewis, the administrator, parts with the securities against Thomas M. and Eobert J. Dick, the proceeds of which pass to the vendors of the slaves, and are appropriated by them, and that Lewis, in exchange and compensation for such proceeds, acquires the possession and ownership of the slaves referred to.

Practically the results seem to be scarcely distinguishable from what would have occurred had the securities referred to been sold at their par value, and payment been made, *283not in money, but in negro slaves at a fair valuation. Had tbe transaction between Lewis and the owners of the slaves been not indirectly and in effect merely, but directly and in form, a sale of the securities against Thomas M. and R. J. Dick, such sale, it is conceived, must have been sustained. "If no more is done,” says Lord Eldon, “than a sale' of part of the assets for money advanced at the time, the vendee can never be affected by proving the executor’s intention, at the time, to misapply the produce; or if he had it not originally, that, afterwards taking up that intention, he did actually misapply the produce. A third person, if there is no more in the transaction, would be fully justified in assuming that the sale was for those purposes for which the law gives an executor the power of sale.” *McLeod*vs. *Drummond,*17 Ves. 154. That the mere form of the consideration, or the mere mode of payment, should change the character of the transaction, cannot be admitted.

It is argued, on behalf of the plaintiff) that the securities against Thomas M. and R. J. Dick were made payable to “William Lewis, administrator of the estate of Leonard White,” and upon their very face gave information that they were held by him as assets of his intestate; that Lewis, at that very time, was in a state Of insolvency or on the very verge of it, and his pecuniary condition notorious, and well known to J. R. Pollard; that the effect of the transfer of the securities to Pollard was in substance an appropriation of them to satisfy the personal debt of Lewis; that the very plan of raising money by purchase upon credit and sale for cash was most significant of Lewis’ condition, being the ordinary expedient of persons oppressed by debt to obtain temporary relief, and was, of itself, sufficient to put Pollard upon his guard, and that therefore Pollard must be held to have concurred and aided designedly in the misapplication of the assets by the administrator. For the reason already indicated, it does not appear to be material whether *284Lewis, at the date of the transfer to Pollard, was or was not solvent. The debt secured by the obligations transferred was not an antecedent debt, but a contemporaneous debt then incurred, and, as must be assumed, upon fair and full consideration, then moving from the other contracting parties. Whether solvent or otherwise, it whs the duty of Lewis to proceed with the administration of Leonard White’s estate, and to complete it. How does it appear that Pollard was advertised of Lewis’ intention to misapply the negro slaves, or the proceeds of their proposed sale ? Certainly the latter avowed no such purpose to Pollard. On the contrary, he claimed to be in advance to his intestate’s estate, to the full amount of the securities in question, and exhibited an abstract of his accounts with the estate, at the same time stating that certain of the distributees had seen and were satisfied with it. How could Pollard know that there were no debts still subsisting against that estate ? *“*It is not reasonable,” remarks the Master of the Rolls, *“*to put every purchaser from an executor to take an account of the testator’s debts, nor has he any means to discover them.” *Hwer*vs. Oorbett, 2 P. Wms. 149.

If what Lewis said was true, there were then *debts*in effect existing against his intestate’s estate to the full amount of the securities transferred, and Lewis himself was the creditor. Indeed, among the executions then in existence against Lewis, there seems to have been one or more against him as administrator of Leonard White. If the money to be raised was intended by Lewis to be used in satisfaction of *sup/i*indebtedness, it cannot be said that he then contemplated any misapplication of the assets. Instead of being in advance- to Leonard White’s estate, it turned out that Lewis was in arrear, and indebted to it in an amount exceeding $14,000. His accounts were in great confusion, and he seems to have been astounded at their result, but whether he designed or not a misapplication of the assets *285of his intestate, the circumstances disclosed do not suffice to bring home to Pollard the knowledge or notice of such purpose on the part of Lewis.

The mode of raising money adopted by Lewis may have been highly inexpedient or eminently judicious, according to the circumstances in which he stood. Whether it was attended with satisfactory results, or otherwise, we are not informed by the evidence. But a party dealing with an executor or administrator, in respect of the assets in his charge, is not bound to ascertain whether, in the particular instance, the latter is discreetly exercising his power. It is sufficient if the purchaser be not privy to a breach of trust, nor engage in a transaction with the executor or administrator which is, in its nature, incompatible with a legitimate administration of the decedent’s estate. 1 Roper, 434-5.

Thus far the' case has been considered as if Lewis, the administrator, had no larger power of disposition over the securities, against Thomas M. and R. J. Dick, than would have belonged to him had they been drawn payable to his intestate, and been held by him as owner in his lifetime. In *Thachum*vs. *Longworth,-*2 Hill Ch. R. 267, the Court distinguishes between the chattels or bonds or securities for money, belonging to the deceased in his lifetime, and such bonds or securities as were acquired after his death by the administrator for the proceeds of the personalty sold. It is there held, that the administrator’s power of disposition over the latter is more large and ample than in respect to the former. “When,” say the Court, “the goods and chattels of the deceased are sold, the liability of the executor or administrator to account for the proceeds to all parties interested is generally that to which they must look. The right to use the fund as his own is also a necessary consequence from his liability to account. If he was not allowed to alien the notes or bonds taken for the proceeds of the sale, (without any other restriction than that it should *286be done without fraud,) it would subject him to the consequences of general liability for the proceeds of the sale without any corresponding advantage.” It was, accordingly, there adjudged that the Court would not disturb a transfer of bonds for payment of his personal debt made by an executor, solvent at the time, though such bonds were for personal property of his testator sold; and being made payable to him, *as such executor,*thus gave notice upon their face of the real nature of his interest in them. The very ground of the judgment is that an appropriation of assets in such form, though to purposes wholly foreign to the administration, constitutes of itself no breach of trust. It results that the transfer or pledge, by Lewis, of the securities against Thomas M. and R. J. Dick, in order to assure payment of his debt for the negro slaves, does not, *of itself,*furnish evidence- of any purpose'to misapply the assets of his intestate, and still less of any knowledge of that purpose on the part of Pollard, the defendant. Such proof must be sought for elsewhere; and it has not been discovered in any of the circumstances disclosed.

Certainly, the defendant, Pollard, could not have been influenced in that transaction by any motive of private gain. He was to derive no profit or advantage from the purchase made by Lewis. If any accrued it was to belong wholly to the latter, and not to Pollard. He seems to have been influenced simply by kindness and good-will towards Lewis, assuming, at his request, and as his mere surety, a serious liability, and receiving, by way of indemnity, certain securities, which have proved insufficient to protect him.

It is also contended, on the part of the plaintiff, who was one of the sureties of Lewis as administrator, that the interest of Pollard in the securities transferred to him is not a legal but a merely equitable interest;. that the plaintiff in this proceeding is entitled to all the rights and remedies of the persons beneficially interested in Leonard White’s *287estate; and that the equities of such persons, being prior in time, have priority of right to that of Pollard, in respect of those securities. From considerations of public policy, the inclination of the Court is to afford all proper facilities to executors and administrators, in their disposition of the effects of their decedents, in a due course of administration. It is to be observed that Pollard is in possession with the consent and by the act of the legal owner. He is not seeking the aid of the Court to give effect, in anywise, to his rights by virtue of the pledge or transfer; but asks merely that the Court shall be passive. “ Mere defect of title,” it has been well said, “ is not a ground for the interference of the Court.” In *McLeod*vs. *Drummond,*14 Yes. 360, a case, in some of its circumstances, very similar to this, the Master of the Rolls remarks: “I do not find that any difference has been made between the power of an executor to dispose in any manner of equitable assets and his power to dispose of legal assets.” In *Scott*vs. Tyler, the bonds, though capable of assignment, were not in fact assigned; and therefore the bankers had not the legal interest; yet it was held that the pledge could be taken from them only upon the ground of implied fraud. “It is objected,” says Lord Hardwicke, “that these were the equitable assets of Sir Richard Billings, and that the plaintiff purchased nothing but an equitable interest, burdened with all the equity in the hands of the person from whom he purchased. But that is a rule only when there is a lien on the thing itself; and I know no difference, in this Court, between the power of an executor to dispose *of*equitable and legal assets.” *Nugent*vs. *Gifford,*1 Atk. 464. Upon appeal to the Lord Chancellor, in the case of *McLeod*vs. *Drummond,*17 Yes. 167, Lord Eldon, after citing certain portions of the judgment of Lord Thurlow, in *Scott*vs. Tyler, thus proceeds: *“*These passages imply that, upon the pledge of a bond, an assignable chose in action, by one executor, the Court must *288have found the means of making it effectual against all, if .there was no fraud; but there is a great difference between an .instrument to be delivered up, when, upon the circumstances under which it was deposited, that would be too much, and in equity calling upon that person and others to make it effectual. In the case before me, the Court is required to order the bonds to be delivered up.” It is to be added that such order was not pronounced.

The case presented by the bill is certainly one of great hardship, but no sufficient ground has been discovered, upon which the Court feels warranted to set aside or impeach the transfer or pledge of securities made to J. E. Pollard by the defendant, Lewis.

It is ordered and adjudged that the bill be dismissed, but without costs.

The plaintiff appealed, and moved the Court of Appeals to reverse the decree, on the following grounds and for the following reasons:

1. In this State, the following duties and regulations, in addition to those found in the common law, are prescribed for the administration of the estates of intestates: The administrator can sell the property of his intestate only by order of Court, (a sale otherwise made being void,) and the Court in granting the order is required to regulate “the time, place and credit to be given;” he,' the administrator, must return a sale-bill, and make annual returns of his receipts and expenditures; and, where he sells on credit, he accounts, not for the sale-bill, as so much cash received, but for the moneys collected on the securities taken at the sale. It follows, from these additional provisions of the law, that an administrator, in this State, holds the securities taken at a sale on credit *in*trust, for the purpose *of collect*ing, *paying debts, and distributing the surplus ;*that a sale or pledge by him of such securities, before he has fully ad*289ministered the estate, especially if such sale or pledge be made for his own private purposes, as was the case here, is a clear breach of trust, for which the party taking the security is responsible, unless he can protect himself by showing a purchase for valuable consideration without notice, which Pollard utterly failed to do.

2. But, if the case be regarded as standing upon the principles of the common law, then it is submitted that where an administrator sells the property of his intestate on credit, and takes the securities, payable to himself, as administrator, it is, according to' the doctrine of equity, a-conversion; the securities are held in the place of the property, and are *assets;*and if the administrator, before he has fully administered the estate, pledges the securities, to indemnify one who becomes his surety on a purchase of property for his own private purposes, it is a *devastavit,*and the surety receiving the securities, with the knowledge that they are assets and that the estate has not been “ wound up,” is equally guilty ; and this whether he knew the purpose to which the administrator intended to apply the property purchased by him or not. A purchase of property by an administrator being entirely outside of his duties, the surety should assume it to be for his own purposes.

8. The securities were payable on their face to Lewis, administrator of Leonard White. This is a proof of notice that they were assets, and of the trust.

*4.*Neither Pollard, in his answer, nor Lewis, who was examined as a witness, deny that Pollard had notice that Lewis intended to apply the proceeds of the negroes purchased by him to his private purposes; and Pollard’s statement, in his answer, that Lewis mentioned “that he had made such large payments to the distributees of Leonard *290White, out of his own funds — that when the estate was wound up, the distributees would fall in debt to him,” together with the intrinsic evidence furnished by the unusual and ruinous shifts and expedients to which Lewis was resorting for the purpose of raising money — shows that Pollard did know that Lewis wanted the money for his private purposes. The circumstances were at least sufficient to put Pollard on the inquiry, and make him stay his hand.

5. If Pollard acted on the faith of Lewis’ representations, he was guilty of gross negligence. He should have required full proof that the representations were true.

6. There was no assignment of the securities, to Pollard, and for the balance yet unpaid on the judgments, recovered in the name of Lewis, the plaintiff is, in any view, entitled to a decree, the legal title being in Lewis, and Pollard, now at any rate, having notice not only of the trust, but of the misapplication of the proceeds of the sale of the negroes.

7. In the transaction between Lewis and Pollard, there was actual *fraud*— dolus *malus*— and each party is responsible to the full extent of the value of the assets that were misapplied.

8. The plaintiff has paid the distributees of Leonard White over $13,000, and it is further liable to creditors yet unpaid for over $2,000. His equity, therefore, is superior to that of one who assisted the administrator in making a gross and fraudulent misapplication of securities which otherwise might have gone to .pay the very demands the plaintiff has paid.

9.Lewis’ insolvency at the time of the pledge was most abundantly shown.

*291The case was argued in the Court of Appeals in December, 1866, by *J. S. G.*Bichardson, for appellant, and *W. F. De Saussure*and *Blanding,*contra; and was "kept under consideration until May, 1867, when it was ordered to this Court, where it was now heard.

*J. S. Q.*Bichardson, for appellant.

*Blanding,*contra.

The principal authorities cited, besides some of those mentioned in the decree, and in the judgment of this Court, are: Act 1798, 5 Stat. 109; Act 1824, 6 Stat. 238; Act 1839, 11 Stat. 43; 2 "W"ms. on Exors. 672-3; Ram on Assets, 490; Shep. Touch, 496; *Downes*vs. *Power,*2 B. & B. 491; *Watkins*vs. *Cheek,*2 Sim. & Stuart, 199; *Cabbage*vs. Boatwright, 1 Russ. Oh. C. 549; *Shipbrook*vs. *JBinchinbrook,*11 Ves. 252; 16 Ves. 477; *Wilson*vs. *Moore,*1 M. & K. 126; *Bassett*vs. *Noseworthy,*2 VT. & T. Lead. Cas. Eq. 44, 59; *Bush*vs. *Bush,*3 Strob. Eq. 131; *Leneve*vs. Leneve, 2 "W. & T. Lead. Cas. Eq. 31-2; *Bow*vs. *Dawson,*2 *W.*& T. Lead. Cas. Eq. 534; *Waite*vs. *Whore-wood, 2*Atk. 159.

The opinion of the Court was delivered by

Inglis, A. J.

An administrator holds his intestate’s title to all the personalty which he left at his death. He holds it, however, not in his *personal*right, as he holds the property which, by purchase, gift, or otherwise, he has acquired for his own use, but in an *official*capacity only. The title is, by the law, annexed inseparably to the office until aliened-in due course of administration. Upon the determination of a particular incumbent’s tenure, by revocation or by death, the title passes with the office to his successor, and is not, in the latter of these two events, devolved, as is the title to *292his own property, upon his personal representatives. And, further, while his tenure endures, he holds the title not in anywise for his own use and benefit, but wholly- for the uses of the office, as the means wherewith to fulfil its duties: *first,*in paying the debts of the intestate, and, *then,*in distributing the residue as directed by the law. His estate is, therefore, according to the strictest definitipn, a *special trust;*he holds “ for the execution of a purpose particularly pointed out,” and *“*is called upon to exert himself actively in the fulfilment of tbe settlor’s intention” — tbe law of the land, which has created his office and prescribed its duties, furnishing the definition of that intention. Lewin on Trusts, 4.

These essential attributes of an administrator’s tenure of bis intestate’s title are, in various respects, recognized and regarded even by the Courts of common law. Thus, for example, the individual, after revocation, will not be permitted to institute, or to continue, proceedings there, founded only upon the title which, as administrator, he bad held, to his intestate’s personalty; nor, after his death, will his personal representatives. Again: the property which he bolds as administrator, and that which he holds in his own right, are not equally and indifferently liable to the satisfaction of judgments at law, recovered against him individually, and in his representative capacity; but,' on the contrary, tbe judgment for tbe recovery of a debt of bis intestate, merely as such, is so framed as to restrict the levy of execution to the goods, &c., of the *intestate*in bis bands, and independently of any effect wrought herein by our peculiar statutes, is certainly entitled to satisfaction out of these goods, &c., at least, in preference to a prior execution for his own personal debt, *(Farr et al.*vs. *Newman et al.,*4 Term Rep. 621,) if the latter, as against creditors and distributees of the intestate, could be levied out of them at all. *Whale*vs. Booth, 4 Term Rep. 625, note (a); *Quick*vs. *Stains,*1 *Bos. & Pul.*293. So, also, upon the bankruptcy of the administrator, *293these goods, &c., are not distributable, under the commission, as his property — their inclusion, specifically, in a schedule of “ his whole estate and effects,” upon an application for the benefit of the Insolvent Laws, would not be a necessary condition to his discharge; and a judgment recovered by him in his representative capacity, on a cause of action constituting part of the assets of his intestate, will not be set off against a judgment which the defendant therein holds against him in his individual capacity. *Tolbert's Exors,*vs. *Harrison,*1 Bail. 599. But the Courts of Equity, because it is within their peculiar jurisdiction so to do, recognize to its utmost extent, and in all respects, this special character of an administrator’s tenure of his intestate’s title — enforce upon him, and all others liable thereto, the obligations thence resulting, and fully protect the interests of those for whose use alone he holds. Story Eq. Jur. § 579.

The first duty of an administrator, in the execution of his trust, as to the *disposition*of the assets come to his hands, is the payment of funeral and other expenses and of his intestate’s debts, and in order to this, the conversion of 'the assets into money is indispensable. In the early periods of legal history, when the administration of the intestate’s effects was a prerogative of the Crown or a privilege of the Church, and often became a largess to the favorites of either, the residue, after payment of debts, or even without such payment, was by defect of law retained by the administrator without account. Personal property then constituted but a small part of a decedent’s estate, was of comparatively little pecuniary value, often of a perishable nature, and rarely of such a kind as to make its preservation in *specie*important. It is not surprising that under such circumstances the conversion of the whole assets became the uniform custom, and so, ultimately, the rule. The necessities of the trust and the interest of the trustee combined to work such a result. The conversion of the assets into *294money, by sale or collection, therefore, and even the procuring an advance of money by their mortgage or pledge, while, to the technical mind of the common law,, it was no more than an exercise of that power of disposition which is inherent in legal ownership; was also, apparently, a strict execution of the administrator’s duty, and part of a due course of administration.

When the advance of arts and commerce had greatly enlarged the comparative importance and enhanced the value of personal estates, the preservation of the assets *in specie*doubtless came to be of far more interest to those who had the best claim to the succession, and their right was recognized, and, gradually, more and more clearly defined and securely guarded, by successive statutory modifications of the law. Still, for the execution of the principal purpose of the trust, the conversion of the assets to the extent of such purpose was necessary, and, even when not so *necessary,*might, under special circumstances affecting the interests of the parties, be highly proper. The responsibility of determining beforehand the existence of such necessity or propriety was not yet imposed upon any judicial tribunal, but left still to the judgment and conscience of the administrator. As, therefore, the condition of the estate might be such as to render a conversion of the assets or of a part of them proper and even necessary — as no provision was made for ascertaining the fact of such condition by the judgment of a competent Court — as an authorized basis of action on the part of strangers, as these could have no means of information whereby they might review the administrator’s judgment in this behalf, except such as he chose to furnish them —and as his honesty and integrity were in law reasonably presumable — his conversion by sale or pledge was still regared as *prima facie*in a due course of administration, and in execution of the purposes of the trust. To have required, in order to the validity of his alienation, the *295*fact,*instead, of the presumption, that the alienation was for the purposes of the trust, or to have exacted from every purchaser a guarantee of the administrator’s fidelity, by making the soundness of his title depend upon the subsequent application of the purchase-money, would have invested the necessary and proper alienations of administrators with heavy impediments, have greatly embarrassed them in the faithful execution of their trusts, and seriously damaged the interests of all persons beneficially concerned. It hence came to be the well-established rule, as well in equity as at law, that the administrator might *“go*freely to market” with his intestate’s assets, and the mere fact that they were assets and were known so to be, affected with no infirmity the title of the purchaser or mortgagee for value. Every such purchaser, &c., was justified by the law, as administered in either forum, in entertaining and proceeding upon the reasonable presumption, that the administrator was acting honestly, and was converting, and would apply, the assets for legitimate purposes.

But, as has been seen, the administrator holds the assets *upon trust*“for the execution of a purpose particularly pointed out” by the law which creates his office, and for this and no other end annexes to it the title of the intestate, to wit, the payment therewith of his intestate’s debts, and the distribution of the residue. The creditors and distribu-tees, therefore, while they have no specific lien which will *necessarily*override the title of a purchaser from the administrator who buys with notice that he is dealing with assets, undoubtedly have an equity, as against the administrator, that the assets shall be applied strictly to the purposes of the trust. And all who claim under the administrator, otherwise than *bona fide*and for value, take subject to this equity. If, contrary to the authorized presumption, the administrator is in fact, in any particular instance of conversion, diverting the assets from their legitimate purposes, and *296applying them to his own use, he is, in so doing, guilty of a breach of trust, and his alienation is in fraud of the equitable rights of the creditors and distributees. He who, knowing of his intended diversion and misapplication, enables him to consummate the fraud by purchasing the assets or advancing money upon their pledge, makes himself *particeps criminis;*and so becomes a *mala fide*purchaser, &c. He takes his purchase not (as he otherwise would) discharged by the sale from, but continuing subject to, the equity o’f the creditors and distributees. He buys at his peril, and the creditors and distributees may, if their interest requires, or they choose, follow the assets in his hands and enforce upon him their equity.

They have not lost their character of assets by the alienation, and he is, *quoad hoc,*trustee to apply them to the purposes of the trust. So long as he knew no more than that they are assets, he might have freely bought, nor concerned himself to inquire with what intention they were sold, or to what use their proceeds were applied; for the administrator had the power of sale, and the-necessities and uses of the trust require that he shall exercise it; and when he does so, the presumption ought to be, and is, that he is in the way of his duty and selling in the execution of his trust. But the fact being contrary, and being known to the purchaser to be so, the presumption cannot have place, and his justification, which rested solely upon the presumption, ceases. If, under such circumstances, the creditors and dis-tributees of the intestate prefer to resort to the direct legal responsibility of sureties for the administrator’s fidelity in his trust, and exact of them satisfaction for the loss resulting from his breach of duty, according to familiar principles of equity jurisprudence, the sureties, have a right to be subrogated to the equity of their principal’s creditors, and to enforce it for their own indemnity. In *McNeil*vs. Morrow, (Rich. Eq. Cas. 172,) it was held, that where a guardian takes *297a conveyance of property to bimself in satisfaction of a debt due to bis ward, or to bimself as guardian, and of other debts, tbe ward may treat it as so much money received, if be chooses, but be has also an equity to have satisfaction of bis debt out of the property itself; and if be elects to treat it as a receipt by bis guardian of so much money, and upon tbe .default of tbe guardian exacts payment thereof from bis surety, tbe latter is entitled to be subrogated to tbe ward’s rights against tbe guardian, and may set up for bis indemnity “'the claim which tbe ward bad from tbe receipt of tbe property in satisfaction of a debt belonging to him,” and to enforce it against tbe guardian and bis *individual creditors.*

In this State,, as early as 1789, tbe vastly enlarged importance of personal estates, and tbe peculiar value of tbe specific form in which, to a large extent, they existed— rendering their transmission without conversion to tbe dis-tributees, and their continuance in tbe intestate’s family, in tbe highest degree desirable — induced an attempt on tbe part of tbe General Assembly to subject tbe administrator’s power of disposition by sale to some control and restriction. A. A. 1789, sec. 19, 5 Stat. 109. Tbe regulation then devised for this end seems to have been shorn of much of its efficiency by judicial construction. *Harth's Exors,*vs. *Heddlestone,*2 Bay, 321. In order to remedy this disappointment of tbe legislative purpose, or' from an increased sense of tbe need of tbe restraint, in 1824, in language too plain to permit misapprehension, tbe previous permission of tbe Court of Equity, or of tbe Court of Ordinary, was made indispensable to tbe validity of any sale by an administrator “ of tbe personal property.” A. A. 1824,.sec. 6, 6 Stat. 238. Tbe effect of our legislation on this subject is to take from the administrator and refer to tbe judgment of tbe Court tbe determination of tbe necessity or propriety of a sale, whether “for division, payment of debts,” or “to prevent tbe loss of perishable articles’” and tbe regulation of tbe *298details of such sale, if ordered, “with impartial regard to the just claims of all persons interested.” The investigation into the condition of the estate and of the administrator’s accounts, which the purchaser could not make, and by the previous law, ás has been seen, was not required to make, is made for him by the Court; and until the judgment of the Court implies that this investigation has been made and has resulted in showing the necessity or propriety of the sale for the purposes of the trust, no one can acquire title by purchase from the administrator. In all cases to which this legislation is applicable, the presumption that the sale proposed by the administrator was in the due course of administration, which before sufficed for the security of the purchaser, is superseded by the positive judgment of the Court, that the sale, is advisable for the purposes of the trust. The title of a purchaser is not hereby made any more safe, nor in any respect put on a better footing than before; but the interests of those beneficially concerned are protected against the mischiefs of a presumption, reasonable in law, but often deceitful in fact, as well as of'a discretion in the manner and terms of sale that was-not likely always “to do impartial justice to all persons interested.” But purchasers are not, by any thing in this legislation, discharged from the obligation of good faith, nor is a license given to fraud. A participation by the purchaser at a sale made under such an order of Court as is here required, in a purposé of the administrator to divert and misapply the proceeds, though difficult to be conceived, yet, if actually occurring, would not be sanctified by a compliance with all the prescribed solemnities.

This legislation cannot, however, be understood as intended to apply to all the assets of an intestate. The terms used — “ personal estate,” “ personal property” — are certainly large enough to embrace every class. But choses in action, at least such as are merely securities for money due, are not *299properly the subject of sale; their conversion is ordinarily by collection/ arid such conversion by public auction is an unusual .proceeding. Many of the reasons which may be supposed- to - have induced' this legislative restraint upon the, administrator’s power of sale are wholly-inapplicable to them, and ’• the sales contemplated by the Acts being, although not positively required, plainly assumed to be on credit, would result in a mere exchange of one chose in action for another. Yet, though the proper method of conversion in such ■ case is by collection, circumstances may exist in which a more speedy conversion, by exchange, with a third person, for the money, or even by a pledge for advances, may be important to the interests of the- administration. . The administrator’s power of disposition over his intestate’s choses in action remains unaffected by this legislation, and continues as his' power over the assets generally before the Acts has been described to have been. Any one may securely take them from him', either absolutely or conditionally, by any of the usual methods of legal or equitable transfer, for *value and in good faith.*He who takes them, knowing that their alienation is not for the purposes of the trust, but for the private purpose of the administrator, takes them in *had faith,*and is liable to account for them. When the specific goods, &c., of the intestate, come to the hands of the administrator, have been by him sold on credit, are the securities taken from them payable to himself, his own absolute property in law and equity, or are they still, in the regard of both or either of these jurisdictions, the assets of the intestate, changed in form, but subject to the same restraint upon alienation, and the same equity? Certainly, the *legal*relations of the administrator to such securities is not the "same as it was to the specific chattels which have been converted into them. He holds the title to these, not merely in his representative capacity, and by virtue of his office, but in his *300personal right, and by the terms of the contract.'» In form, and in law, he is personally the creditor of the obligor in each bond, and the maker of each note. The legal title thus vested in him is not divested by a mere revocation of the Ordinary’s grant. At his death it passes not to his official successor, but to his personal representative. Actions for the recovery of the amounts secured by such bonds, &c., can be maintained at law only in his own name while living, or in that of his personal representative after his death, unless the title has been transferred by the act of the one or the other. Yet, in point of fact, these securities are but the representatives of the specific assets, which have been converted into them by the order of the law; they stand in their place. They are the materials with which the *legal*duties of his office are yet to be fulfilled. His fulfilment of these duties may be the subject of *inquiry,*under his plea of *plene administravit,*in a Court of law; *Johnson*vs. Johnson, 1 Bail. 601; or even the subject of enforcement there in an action on his bond; *Ordinary*vs. Hunt, 1 McMull. 382; *Wiley*vs. *Johnsey,*6 Rich. 358. In such a proceeding, does the Court of law wholly ignore the fact of the real character of such securities — because the *legal*title is in the administrator personally, refuse to regard and treat them as substantially and truly the assets —and, considering the administrator as by his sale himself become the purchaser at the same or any other price, in favor of the creditors of the intestate, charge him absolutely with the proceeds ? Let it be supposed that in such a proceeding the creditor claims to charge the administrator with the aggregate amount of his sales of the intestate’s goods, &c., and thereby show a residue of assets in his hands, to satisfy the debt sought to be recovered, after a due administration of all except such residue, and the administrator proposes to prove that certain of the securities taken at his sale, just sufficient in amount to *301cover this residue, had, without any fault on his part, become valueless, will the Court of law not entertain the excuse, and, if it be established, discharge the administrator ? And if so, how can it do this, except on the ground that these securities are in truth and substance the assets, and that for *them*specifically, and not for the amount of the sale-bill, as so much money received at its maturity, the administrator is bound to account, and that only according to the ordinary rule of fiduciary responsibility ? *Dixon, Admr.,*vs. Hunter, 3 Hill, 206 ; *Bryan*vs. *Mulligan, 2*Hill Ch. 361; *Mikell*vs. *Mikell,*5 Rich. Eq. 225. Cr if in such a proceeding at law the creditor claims to charge the administrator with the securities taken at the sale, as principal and interest due on each has been from time collected by him, (as under- possible circumstances might be for his interest,) will it -be supposed that the Court would forbid this, and require him to abide by the sales-bill ? If in an action brought upon such a security litigation arise and expenses are incurred, will the Court of law not admit the administrator’s payment of these expenses as a fair and proper charge against the estate in his accounts ? It is quite manifest, from the opinion in *Dixon, Admr.,*vs. Hunter, *(ut supra,)*that in the regard of a Court of *law*even the securities taken by an administrator at his sale of his intestate’s goods, &c., are really the assets changed only in form, and that for these specifically and in detail the administrator ought to be held liable; that in his annual returns and in his final account he should charge himself with the aggregate of principal and interest due and received on each of them when actually collected; and if his omission to collect them all has been prudent and consistent with his duty — as where they constitute a good investment of the funds — he may fairly bring the uncollected residue of them specifically in for distribution; and that, only when the administrator fails thus to keep and settle his accounts, *302he may be charged with the sale-bill in gross, as the necessity of so doing is imposed upon the parties by his failure to furnish ■ them the means of more exact information. "The former method,” says the Court, "is according to the truth of the. facts.” The sale-bill is resorted to, not as the *matter,*but as the *measure*of accountability, because he who only can supply a better does not, and this, as matter of public custody, is accessible and convenient. In Tolbert, *Exor.,*vs. *Harrison,*1 Bail. 599, the judgment which the plaintiff had recovered against the defendant was on a note given by the latter to the plaintiff for purchases at a sale of the testator’s effects,.and the Court of law refused, in the exercise of its discretion, to make an order setting off against it a judgment which the defendant held against the plaintiff for his individual debt. " There can be no doubt,” says O’Neall, J., “ that technically the judgments are in the same right. The note given to the executor for a contract made with him must be treated and considered as his own. In a legal point of view it was the note of Harrison to Tolbert. It is, however, unquestionable that in fact it was a part of the assets of the estate of his testator, and the executor might and ought to have treated it as such. He on the present occasion claims that it shall be treated as assets of the estate.” It will be observed that here it was the executor himself who interposed the objection that the note on which he had recovered judgment was assets of his testator’s estate, yet it was entertained. It would seem, therefore, that the form of these securities does not conceal their real nature from the eye even of the *law*Court, nor prevent the conformity of its judgment thereto, in all controversies there cognizable between the administrator and those for whose use he holds the legal title.

But this is a cause on the *equity*side of the Court, and the pertinent inquiry, therefore, is as to how these securities are regarded and treated in that jurisdiction. . The fact that *303the legal title is vested in the administrator personally, cannot embarrass a forum, one of whose principal functions it is to compel the legal title in one person to support and serve the beneficial interest in others, and more especially when, as is usual, the trust upon which the administrator holds the legal title, is declared on the face of the security, under the description of the official character in which the promise is made to him. In *Glass*vs. *Baxter,*(1811,) 4 Des. 153, a note was taken by an administrator, payable to himself .individually, (without any official description,) partly for assets of his-.intestate, purchased by the maker at a sale by the.administrator, and partly for goods of the administrator, personally sold to him at the same time, and included in the note as security for purchases of the intestate’s goods to the same amount bought at the sale by the administrator himself. Upon a revocation of the administration, this note was given over to the administrator *de bonis non*as belonging to the estate of the intestate. Upon the payee — the original administrator — leaving the State, an attachment was sued out by his private creditor, and the maker of the note garnisheed.' The attachment suit was enjoined in equity. This was a circuit decree only, not reviewed on appeal. But in *Tolbert, Exor.,*vs. *Harrison,*cited above, O’Neall, J., quoted it as authority for the proposition that “the Court of equity, in the exercise of the jurisdiction which legitimately belongs to it over trustees, will follow a note of hand as the property of an estate, if really taken for assets of the estate, sold by the administrator, though the note be taken in the private name of the administrator, and will enforce this by injunction against the private creditor of the administrator.” The same Judge, in *Thackhum*vs. *Longworth,*(1835,) 2 Hill Ch. 267, says: “ It is true that the proceeds of such choses in action” *(i. e.*notes or bonds taken by an administrator at a sale of his intestate’s estate) “ are in equity regarded *304as assets, and will be so treated and considered in tbe hands of tbe executor or administrator to wbom they were made payable, or any of bis immediate representatives. So, too, in all such' cases they would be protected from being made liable by process of law for tbe debts of tbe executor or administrator; and, in all cases of fraudulent alienations, tbe Court would follow and treat them as assets of the' estate;” and cites as authority, among, others, this case of *Glass*vs. *Baxter.*In *Thomas*vs. *Gage et al.,*(1824,) Harp. Eq. 197, GK, indebted to tbe administrators by note for purchases at a sale of the estate, and bolding a judgment against one of them individually, gave that one a receipt for tbe amount of his judgment, and a new note for the balance of his (Gr.’s) note to tbe administrators, and took that administrator’s receipt against bis note, which was then in tbe other administrator’s bands. Gr. knew at tbe time there were outstanding debts of tbe intestate, and that the administrator with whom be dealt was in embarrassed circumstances. It was held that Gr. must account to tbe estate for tbe amount of the assets be took in payment of bis judgment against tbe administrator individually, if such administrator should be unable to pay it.

In *Miller*vs. *Alexander,*(1833,) 1 Hill Ch. 26, at a sale of A. M.’s estate by bis administrator, tbe plaintiff was a purchaser, and gave her note, with surety, payable to tbe administrator as such. Upon tbe death of tbe administrator, plaintiff took out administration *de bonis non*of A. M.’s estate, and possessed herself, in some way, of her own note, still unpaid. Tbe executors of tbe first administrator, to wbom plaintiff’s note was, by its terms, payable, sued at law, and recovered judgment against her on tbe note. Plaintiff thereupon brought her bill in equity, as administrator *de bonis*non, against tbe defendants; as executors, for an account of their testator’s administration, and to enjoin tbe collection of tbe judgment at law, on tbe ground that tbe *305note an'd its proceeds belonged to her intestate’s estate, and that she, as the representative of that estate, was entitled to it and its proceeds. Upon the account taken, the first administrator was found indebted to bis intestate’s estate, in a balance exceeding tbe note and interest, and tbe enforcement of tbe judgment at law against tbe plaintiff on tbe note was perpetually enjoined, and sbe was required to charge herself in ber administration account with tbe amount of tbe note and interest. O’Neall, J., for tbe Court, says: "Tbe balance reported against tbe administrator was tbe money of tbe intestate still in bis bands to be administered. Upon bis death, bis legal right to retain it ceased, and upon tbe grant of administration *de bonis non,*it passed as tbe goods, chattels and credits of tbe deceased, unadministered by the first administrator to tbe plaintiff. This legal right to receive tbe unadministered balance of tbe money did not make ber the legal owner of tbe ■ note; that, legally, belonged to tbe administrator, to whom it was payable, and at bis death tbe right of action upon it passed to bis executors.” "This is tbe extent of tbe doctrine of *Seabrook*vs. *Williams,*3 McC. 371. It never was intended to be said, in that case, that, because an administrator *de bonis non*could not sue on a note given to tbe first administrator, be would not be entitled to recover in equity any unadministered balance in tbe bands of tbe first administrator.” And tbe particular view taken is, that, in equity, tbe plaintiff would be entitled to have the decree against tbe executors of tbe first administrator, for tbe balance, set off against tbe judgment held by them, at law, against ber, on tbe note. If tbe plaintiff’s note bad been given to tbe first administrator for a consideration personal to himself, and not moving from tbe intestate’s estate, it would not have been set off. Vide *Tolbert*vs. *Harrison, ut supra.*But tbe money secured by ber note was, in equity, assets of ber intestate’s estate yet unadministered, and sbe bad a right to *306follow and claim it as such. The defendants, instead of suing upon it at law, might have turned it over to her, as administratrix *de bonis non,*as assets to be by her adminis' tered, and to that extent thereby reduced the balance found due upon the account of their testator’s administration. For this was exactly what the judgment of the Court, in effect, did.

*Field*vs. *Schieffelin,*7 Johns. Ch. 150, is a well-considered case, in which Chancellor Kent carefully examines the subject of the liability of a purchaser of a testator’s assets from his executor. Having .passed the English cases in review, he states the result thus : *“*They all agree in this, that the purchaser is safe, if he is no party to any fraud in the executor, and *has no Imowledge or proof that the executor intended to misapply the proceeds,*or was in fact, by the very transaction, applying them to the extinguishing of his own private debt. The great difficulty has been to determine how far the purchaser dealt at his peril when he knew, from the very face of the proceeding, that the executor *was applying the assets to his own private purposes,*as the payment of his own debt. The later and the better doctrine is' that, in such case, he does buy at his peril, but that, if he has no such proof or knowledge, he is not bound to inquire into the state of the trust, because he has no means to support the inquiry, and he may safely rely upon the general presumption that the executor is in the due exercise of his trust.” And.he applied the rule in the case then before him to a purchase from a' guardian, but refused the relief on the ground that the evidence did not satisfy him of- the purchaser’s knowledge of the guardian’s misapplication. But the important point in this,particular connection is that the subject of alienation there was a bond, not received by the guardian originally as part of his ward’s estate, but made and payable to him as guardian for a consideration moving from himself in *307that capacity. If, in the judgment of equity, there be any ground for a distinction in this regard between a chose in action payable to the intestate in his lifetime and come to the hands of the administrator as part of the original assets, and a security taken by an administrator for his intestate’s goods, &c., at a sale thereof, in favor of the former, is it at all likely that the trained and practised mind of that great Equity Judge would have wholly overlooked it and committed such a capital error ? But he is not singular. In *Petrie*vs. *Clark,*11 Serg. & R. 377, the right of creditors and legatees to follow assets that have been collusively parted with is examined, and the rule is stated to be, that he only can maintain his purchase against their equity who has given a valuable consideration, and is guiltless of fraud or collusion with the executor, &e. Gibson, J., says: “In regard of a pledge, there is a decisive difference between the pawning of a security for an antecedent debt and the pawning of it for money advanced at the time. As to the *first,*all the cases agree, that the interest of the pawnee is defeasible by creditors; and as to the *second,*the validity of the contract depends on all those considerations that would affect an absolute sale under like circumstances; that is, where it appears the *pawnee knew that the money was obtained for purposes foreign to the executor's duty, the transaction is to be considered collusive." “*The note on which suit is brought in this case,” says he, “was indorsed to the executors in blank for goods purchased from them, which were part of the assets, and *the note itself was consequently assets in their hands.*The executor, who had this note in possession, was indebted to the plaintiff on his own promissory note, to nearly the same amount, and after his note became due, made arrangements with the plaintiff by which it was taken up, and a new note, at five months, substituted; and the note on which suit is brought was handed over, with the blank indorsement of *308the payee, as collateral security for the payment of this debt, the other executor being no party to the transaction, and the plaintiff being entirely ignorant of the circumstances under which the note in question came into the hands of the executor. On this naked statement of facts it will be seen that collusion is altogether out of the case, and that the question is, whether the plaintiff is to'be considered a holder *for value.*If the note had been delivered to him in *discharge*of the debt, there would be no difficulty in saying, *in the absence of collusion,*that, taking it, in the usual course of business, as an equivalent for a debt which is given up, would be a purchase of it for valuable considerations.” From all which it is manifest that he considered “choses in action acquired by the executor or administrator, with or given to him for the proceeds of the estate,” subject to precisely the same equities, of creditors, legatees and distributees, as attach upon such as belonged to the deceased in his lifetime.

*Thackum*vs. *Longworth, 2*Hill Ch. 267, is in some respects a remarkable case. McNish was indebted to Long-worth, by his bond given in 1818, for the purchase-money of a plantation sold to him by Longworth, as executor of another. Milliken died in 1819, leaving a will of which McNish was executor, and by the provisions of which he gave a life-estate to his widow in all the residue of the proceeds of his property after payment of debts, with remainder to the plaintiff, Mrs. Thackum. In the same year McNish sold; under a power in the will, all the estate of his testator, and took from the purchasers bonds payable to himself as executor, among them Hardee’s and Cole’s bonds. In 1820 he offered the last-named bonds to Longworth in payment of his own bond of 1818, which offer was refused. Then he delivered them to Longworth, indorsed in blank, to be collected, with instructions to apply the proceeds, when received, to the payment of his bond, if it should not have *309been previously paid. Longwortb received tbe money due on tbe bonds in January, 1823, and, in conformity with instructions repeated by McNisb when advised of the collection, entered tbe amount as a credit upon MeNish’s private bond of 1818, and took tbe receipt of tbe latter for tbe money as paid to bim thereby, wbicb receipt stated tbe money to bave been collected by Longwortb for McNisb from Hardee and Cole “ *on account of the estate of*Milliken.” It does not appear when tbe widow died, but tbe plaintiff entitled in remainder upon tbe widow’s death sued tbe executor, McNisb, in 1825, and, owing to bis insolvency, bad never recovered any part of her legacy. It is not stated when tbe bill against Longwortb was filed, but it came on for a bearing in January, 1833. In tbe meantime Long-wortb bad settled tbe *estate*of *his*testator, and paid over this money to tbe uses thereof. If tbe decided cases bave not been altogether wrongly read, and tbe principle of liability wholly misconceived, it cannot be doubted that, if tbe bonds of Hardee and Cole bad been original assets held by and payable to Milliken himself in bis lifetime, tbe defendant, Longworth, would have been required by tbe Appeal Court to account for them to tbe residuary legatee, as tbe Chancellor (Harper) on tbe circuit bad ordered bim to do, unless protection bad been found for bim in tbe delay of tbe parties in interest, during tbe long period of twelve or thirteen years, to question bis title to retain tbe money, and tbe fact that, lulled into security by their apparent acquiescence, be bad actually distributed tbe funds in tbe settlement of tbe estate to wbicb they belonged. He knew that tbe bonds were tbe property of tbe estate of Milliken, taken for tbe assets sold by tbe executor, held by McNish in trust for tbe purposes of that estate. He knew that, in tbe transaction between himself and McNisb, tbe latter was diverting tbe proceeds of these bonds from tbe purposes of tbe trust in applying them to bis own private use, and, by *310accepting them, for such purpose, instead of enforcing his own remedies against his debtor, he enabled him to consummate the misapplication, confederated with him- to accomplish the breach of trust, and colluded with him to deprive of their rights, and the security for them which- the specific property of the estate gave them, those beneficially entitled. This seems to be conceded; for the reversal of the Chancellor’s decree, and the denial of the relief prayed, are rested on the distinction which the Judge, delivering the opinion, considered as existing “between alienations of the chattels or choses. in action, belonging to the deceased in his lifetime, and of such as are acquired by the executor or administrator with, or given to him for, the proceeds of the estate,” which distinction, he thought, Chancellor Kent had, in *Field*vs. *Schieffelin, failed*to advert to. Yet these remarkable words, as already quoted, are used in the opinion of the Court: “ It is true, that the proceeds of such choses in *action are in equity regarded as assets,*and will be so treated and considered in the hands of the administrator to whom they are made payable, or any of his immediate representatives. So, too, in all such cases, they would be protected from being made liable, by the process of -law, for the debts of the administrator, and *in all cases of fraudulent alienations, the Court*would follow and treat them as assets of the estate.” It would seem as if no larger concession than this could be asked or needed. Is not this applying to them in terms the same rule which fences round the original assets, *“*choses in action belonging to the deceased in his lifetime ?” What is a *“fraudulent alienation*in” the sense of the rule ? Does it require actual dishonesty of design, craft, circumvention combined? The administrator who wastes the assets by giving them away or selling at a gross undervalue, and thereby, to that extent, endangers the purposes of his trust, is guilty, in the regard of this rule, of a fraud upon the rights of those in interest, and the donee or purchaser is a *311party to the fraud. The purpose of the administrator, tacit or declared, to make it • up from his own means, however sincere, will not sanctify the transaction in law, or neutralize its viciousness. But the diversion of the. assets, or their proceeds, from the legitimate ends of the trust, and the application of them to the administrator’s private purposes of necessity, self-indulgence, or speculation, is no less a fraud upon those rights. And he who, with knowledge of the wrong purpose, unites with him in the consummation of such a diversion by becoming a purchaser, is a fraudulent alienee in equity, let the actual intention be ever so innocent o'f injury to the parties interested in the estate. Such seems to have been the judgment of the late Court of Appeals in Equity, in *Spear*vs. *Spear,*9 Rich. Eq. 184, where the guardian was supposed to be using his ward’s money in his mercantile business, and was deemed therein guilty of a breach of trust. So Lord Eldon evidently thought of such “a most inequitable transaction,” as he calls it in *McLeod*vs. *Drummond,*17 Vesey, 153. *“*The Master of the Rolls truly observes,” says he, “ that there is a great difference between advancing money at the time upon securities, and taking a security in discharge of an antecedent debt; but this is, by no means, conclusive. The argument is carried nearly to this extent, that a person lending money at the time upon the deposit of the securities can hardly be supposed to mean fraud, as there is no temptation to fraud. Admitting, however, that the bankers had no other motive for the advance upon such a deposit than they generally have, *if it appears in the transaction itself that the borrower is about to apply the money so raised upon the testator's property to objects with which his affairs have no connection,*I should hesitate to say, that, as the temptation was so slight, the Court would not examine whether that was not a most inequitable transaction with reference to the persons entitled to that property.” So Lord Thurlow, in *Scott*vs. *Tyler,**3122 Dick. 712, adjudged: “But fraud and covin will vitiate any transaction, and turn it to a mere color. If one concerts with an executor, by obtaining the testator’s effects at a nominal price or fraudulent undervalue, or *by applying the real value to the purchase of other subjects*for his own behoof, or in extinguishing the private debt of the executor, or *in any other manner contrary to the duty and office of executor,*such concert will involve the seeming purchaser or pawnee, and make him liable for the full value.” And so, certainly, concluded the careful and discriminating and accurate editor of the American edition of *White & Tudor's Leading Gases in*Equity, when, upon a full review of the English and American cases on the subject, he thus states the result: “ Fraud will be presumed in equity, if not at law, whenever the purchaser knows, or has such notice as is equivalent to knowledge, that the property belongs to the estate, and that the executor is applying or means to apply the proceeds of sale to his own use.” 1 Lead. Cas. Eq. 92, Am. Notes to *Elliot*vs. *Merriman.*

Did not Longworth know that the bonds of Hardee and Cole belonged to Milliken’s estate ? Did he not know that, in the very transaction with him, the executor, McNish, was applying the proceeds to his own use ? If this was so, and he knew it, then it was in equity a *“*fraudulent alienation,” and he was a party to it. And, according to the proposition of the opinion in respect to this very class of securities to which the bonds belonged, it would seem that they ought to have been *“*followed and treated as assets of the estate.” This the Chancellor on the circuit had done, but the Court above reversed his decree. The purchaser who, having his debt well secured, had what Lord Eldon calls “so slight a temptation” to put in jeopardy the rights of the legatee, retained the fruit of his “ most inequitable transaction,” and the' plaintiff “received not one cent of her father’s estate.” The Court, in giving its judgment by *313O’Neall, J., says: “When the goods and chattels of the deceased are sold, or his choses in action collected, the liability of the executor, or administrator, to account for the proceeds to all parties interested, is generally that to which they must look. The right to collect these proceeds is ■indispensable to the executor’s and administrator’s own safety. The right to use the fund as his own is also a necessary consequence from his liability to account. For, • after he sells he is not charged with the proceeds as he receives the money on the notes or bonds, but with the amount of the sales as cash received. *Wright*vs. *Davis,*2 Hill L. R. 560. Upon this sum (the amount of the sale-bill) he is chargeable with interest, which shows that, in contemplation of law, he is regarded as in the use of the money. He cannot be discharged from his liability to account for the proceeds of sale but by showing that, without any fault- of his own, he has been unable to make them available. If he was not allowed to alien the notes or bonds taken for the proceeds of sale, (without any other restriction than that it should be done without fraud,) it would subject him to the consequences of general liability for the proceeds of sale, without any corresponding advantage. For, after he made a sale, and charged himself in the sale-bill with the value of the goods, yet he would stand in relation to the proceeds as if they were the goods and chattels and credits of the deceased. Such cannot be the case. If it was, the executor or administrator ought to return to the Ordinary the bonds or notes so taken by him. There is no difference, in respect to this question, between an administrator and an executor, yet, if it be true that, when an administrator transfers the bonds taken by him for the goods of the deceased in payment of his own debt, such transfer would be void, it would follow that his' sureties for the administration would, as well as creditors, legatees or distributees, have the right to follow the fund, *314yet I apprehend that'such a consequence ought not generally to be allowed. I have already said that an alienation of the bonds or notes payable to an executor or administrator ought not to be overreached but by a superior equity or by fraud.” Is this reasoning as convincing now as it was when it conducted to the startling result of that litigation ? Have not subsequent adjudications knocked away the premises which support it ? Upon a sale by an administrator of the intestate’s assets, does the *law*immediately charge him with the aggregate amount of the sale-bill as so much cash then received, without reference to the actual terms of sale, whether for cash or on credit ? Is the whole estate of the intestate thereby converted into one single chose in action, to wit, the claim against the administrator for an account, and he turned into a debtor to the creditors and distribu-tees for the proceeds as cash ? Under the old law, administrators were “ accountable and chargeable for the true value ” of the intestate’s personalty come to their hands, (A. A. 1745, sec. 3, 3 Stat. 667.) According to the general rule, independently of our statutes restraining the power of disposition, the administrator sells or not at his own discretion, and in such manner, whether by private negotiation or at public outcry, and on such terms, whether of cash or credit, as he pleases. He is chargeable with the assets, and not having them to produce *in specie,*he is accountable for their true value, and, having taken upon himself the responsibility of converting them upon such terms as suited himself, it is not surprising that the actual sale-bill should have been frequently adopted^ by the parties calling him to account, as the standard of the true value, until it ultimately became the uniform custom, and acquired almost the force of a rule. There might have been, in that condition of things, some show of reason in charging him with the sale *when made,*and throwing the responsibility of collecting or making good the securities he took upon his own judgment, *315on himself. Yet, it is supposed, such a course was never conclusive upon either party. The persons interested in 'the estate could have surcharged by showing that the true value was more, and that the sale was depressed by his want of diligence or good faith. And the administrator could have shown that he sold judiciously and in good faith, on credit, and that, without fault on his part, the security taken had proved worthless. But now, when the whole discretion has been withdrawn from him, as is done by our statutes on the subject, and his office in the sale is ministerial only — when the conversion of the assets is the act of the Court, upon its own judgment of the necessities or interests of the estate, and “the time, place, and credit to be given ” are by it regulated “ with impartial reference to the interests of all concerned,” and he is merely the agent of the Court to execute its instructions — there seems to be little propriety in charging him any otherwise than “ according to the truth of the facts,” and that is, by treating the securities, taken in conformity with the order of the Court, as the *assets by substitution,*and charging him with them in detail as they are in fact collected at the times and in the exact amounts, as collected. If, as part of the law regulating the accountability of an administrator, he is, irrespective of his consent or fault, chargeable with the aggregate amount of his sale, as so much cash then received, and the securities taken by him are, as in such case it would seem they ought to be, his own absolute property, upon what ground of reason can, on the one hand, any *fraud*in his alienation of them affect its validity, or rather, how can there be any fraud, unless it be upon his own creditors as such, or upon the alienee; or, on the other, can he make reclamation upon the estate upon his subsequent failure, from whatever cause, to collect them ? And, then, if these securities are his own absolute property, and not, in the judgment of equity, substantially the assets of the entire estate, or, if *316it be preferred so to call them, new investments of tbe trust funds, with tbeir fiduciary character openly impressed on their face or otherwise disclosed, and so assets by substitution, the equities, which the creditors and distributees had for the protection of their interests against a fraudulent diversion of the trust property from its legitimate purposes by the administrator and his confederates, are finally gone.

The original assets are certainly, unless in particular cases of fraud or collusion already adverted to, discharged of such equities. If these equities are not transferred to„and do not attach upon, the securities into which they have been converted, then are the creditors and distributees in a worse condition than before the sale ; and, if that has been, in fact, unnecessary and really wrong, as is undoubtedly sometimes the case, the one wrong, when successfully accomplished, is made to justify all that -follow in its track. No defence whatever remains to them against the consequences of any subsequent misapplication of the proceeds of such sale, except the personal responsibility of the administrator and his bond. The next day after completing the bale of his intestate’s whole assets, he may distribute the securities taken therefor among his own creditors, or make a voluntary assignment of them, with the rest of his property, for their benefit. Upon his death they go, in the' mass of his per-, sonalty, and as part thereof, into the hands of his individual representative, and, in the event of his estate proving insufficient to satisfy all his debts and liabilities, the creditors and distributees of his intestate have no other claim upon them than for a *pro rata*share, in common with his private creditors. The mischiefs of such a doctrine to the parties beneficially interested in the estate of a decedent are more manifest when their interests are in the hands of an executor, without the security of a bond for fidelity. But the rule must be the same, whether the case be one of testacy *317or intestacy. How can any or all of these results possibly be prevented, except on the ground that these securities are Btpt the absolute property of the administrator, but are held by him in trust for the purposes of his administration, and that the equity of all interested in the accomplishment of those purposes to have them applied thereto as against himself, and all claiming under him, except such as have taken them for value and in good faith, attaches upon them and will be enforced by the Court ? These securities can occupy no middle ground; they can be of no mongrel character. They are either the one thing or the other; either the legal title and the beneficial interest unite in the administrator, or else he holds the legal title in trust for the benefit of others. If the former be the case, there can be no special claim upon them acquired otherwise than can be on his property generally. If the latter, then they are in his hands, in the regard of equity, exactly as the original assets were, subject to the same restrictions upon the power of alienation and the same equity.

But what is *administration ?*Does the mere conversion of the specific assets into *money*even consummate it? Expressions implying this have been used by Judges. But is not the application of the proceeds, according to law, in payment of debts and in distribution, also essential to its completion ? Certainly the forms of oath and bond exacted of an administrator import this. If an administrator convert the whole of his intestate’s assets into money by collection and sale, and die, leaving the money so received distinguished and separated from his own in a packet indorsed so as to indicate that it is the proceeds of such conversion, would not the parcel of money so marked and identified be assets of the original intestate to pass into the hands of him who shall be deputed to administer the yet *unadministered*estate ? And would not equity enforce the right of such administrator *de bonis non*to the specific pos*318session ? Or if, without having so distinguished it, he die, with the entire proceeds or any part thereof in his hands, having made no distribution, and leaving debts of his intestate unsatisfied, is not an administrator *de bonis non*entitled in equity to claim and have such proceeds from the personal representatives of his predecessor in the administration, as assets of his own intestate, to be by such administrator *de bonis non*administered ? Such is understood to have been the concurrent opinion of three of the Chancellors and five of the Law Judges of this State, as announced *“*in the judgment of this Court ” in *Villard*vs. Robert, 1 Strob. Eq. 393. If, then, an administrator, under an order such as our law now requires, sells the estate of his intestate on a credit, taking bonds or notes with sureties as directed, payable to him as administrator, and so distinguished from such as are his own, and die while the period of credit is yet unexpired, will not the administrator *de bonis non*of the original intestate be entitled in equity to a specific delivery of such securities, (subject, of course, to a right to retain for any balance of advances or charges,) to be by himself collected and applied in a due course of administration, and to a transfer, if need be, of the legal title by the personal representatives of the deceased administrator, in order to enable him the more effectually to do this ? If so, does he not receive them as assets of his intestate yet unadministered, and how can they be such, if they were not so in the hands of the first administrator ?

If, when the account of an administrator is called for, the securities taken at a sale have been past due for a time long enough to have allowed their collection, and this has not been effected, and no sufficient cause is shown for the failure, this may be a very good reason for permitting the adverse parties, if they so choose, to charge the administrator with such as remain uncollected, and interest upon these to the time of accounting.

*319But this is a very different thing from regarding and treating them as his absolute property from the time of the sale, and considering him by reason of such sale as become forthwith a debtor for the aggregate amount of the sale-bill. The same course may be and has been pursued in reference to choses in action held by the intestate in his lifetime, and come to the hands of the administrator as part of the original assets, when he could have collected them, and neglected to do so. In *Wright*vs. *Davis, 2*Hill, 560, referred to in the opinion in *Thackum*vs. *Longworth,*it is said, “the whole amount of the sale-bill is properly chargeable to the administrator as so much money received *on the day when due."*But if the bonds, &c., taken at the sale be his absolute property, the proper time for charging him must be the day of the sale, for he has then appropriated the assets. There is no more reason for waiting until the maturity of the securities, or, at least, the expiration of the time limited by the order of sale, than there is for waiting until he has had time enough, in the usual course of lega! proceedings, to collect them. According to all the probabilities which result from actual experience, the latter is far the more reasonable, if reference is intended to be had to the likelihood that he has in fact received the money due on them. And if he has had a sufficient and satisfactory reason, with reference to the interests of the parties, for forbearing to collect them, though time has sufficed, it is quite as reasonable as either not to charge him with them until his final accounting, and not then unless with his consent. But if this practice of charging the administrator with the sale-bill has been resorted to, as a method of approximating the “truth of things,” when the administrator himself either cannot, from his defective mode of keeping his accounts, or will not, give the necessary information of that truth, then it is not difficult to see why the date of the maturity of the *320bonds, &c., bas been chosen as the time for making the charge.'

But *Thackum*vs. *Longworth*was decided in March, 1835, and the points made in the extract from the opinion which has been here introduced were brought again under review before a Court composed of Chancellors and Law Judges sitting together in December, 1836, in *Dixon, Admr.,*vs. *Hunter,*3 Hill, 204, already cited. Upon that occasion conclusions were reached, and are stated in the judgment of the Court, wholly different from the propositions on the same points in *Thackum*vs. *Longworth,*and entirely in accordance with the views which have been here urged, so far as these are applicable thereto. *“*But,” says Evans, J., as the organ of the Court, “ there is another question growing out of this case. The Ordinary, adopting the rule laid down in *Davis*vs. *Wright,*charged the administrator with the gross amount of the sale-bill at the-time it became due, and this, with the other items of receipts for the current year, deducting the payments, constituted the balance on the 1st January, 1835. In the case of *Davis*vs. *Wright,*this mode of settling executors’ accounts is adopted, as calculated to do justice in the great majority of cases. I subscribe most cheerfully to the general'reasoning of that well-considered opinion, but it seems to me that the same desire to simplify, and thus render intelligible and practicable, the rules to be observed in settling trustees’ accounts, bas led to the same error as in *Jones*vs. *West,*2 Hill, 560. The error is in substituting a rule for a principle. The rule is inflexible, but the principle adapts itself to the infinite variety of the affairs of men. Can any good reason be assigned if an executor suffer the sale-bill to remain at interest, collecting so- much as is necessary to meet the exigencies of the estate, rendering regular accounts of his transactions, showing when he collected the funds of the estate, and how and when he disposed .of them, why his *321accounts should not be settled according to the truth of the facts, rather than by reference to any artificial rule ?

“ The position here stated is illustrated by the case under consideration. The administrator appears to have rendered annually, accounts, (the correctness of which was not impeached,) of his transactions in relation to the estate. When he collected debts he charged himself with them, and when he paid a debt he entered it as a credit. The notes and debts uncollected, with interest due thereon, he offered to, bring into the'final settlement, and thus account for all the trust funds which had come into his hands.

*“*This, it seems to me, was acting in good faith, and was doing in relation to the estate, exactly what a prudent man would do in relation to his own affairs. All that could be asked of him was, that he should show satisfactorily how he had disposed of the funds, and that he had not suffered them to be unnecessarily unproductive. If he had not made interest when he might have done so, he should be charged with the interest thus lost, and if it was necessary to keep the fund on hand to meet the debts or necessary ex- / penses, then he ought not to be charged with interest. But, it is supposed, there is no difference between this mode of settling the accounts and that mode which charges the amount of the sale-bill in gross. This is not so. By this latter mode, interest is charged as if he had collected the whole sale-bill on the first of January, after it became due, and put it out to interest on that day, and the accruing interest is brought into the account at the beginning of each year, as if the executor had collected it precisely on the day it was due, which is requiring more than can be done by any man in relation to his own private affairs, and this is all that is expected or required of an executor. I am not to be understood as meaning to say, that every trustee' is entitled to have his accounts so adjusted. If he acts fairly, if he renders his accounts according to law to the *322Ordinary, and exhibits by his returns a full and satisfactory account of his transactions in relation to his trust, then his accounts are to be adjusted in the way herein directed. But if, as is too often the case, he renders no accounts, or such as he renders are irregular or imperfect, then the general rule, as in *Davis*vs. *Wright,*and adopted by the Ordinary in this case, ought to be applied, of charging him with the gross amount of the sale-bill, and computing interest on the principal of annual balances, as herein set forth. Of this, if it works injustice, and subjects him to a greater amount of interest than he has made, he cannot complain. It is the effect of his own conduct, and of his neglect of the duties imposed on him by law, and the office which he has undertaken to execute. The office of an executor is one of great trust and importance, and every inducement should be held out to the honest and faithful discharge of its duties, and no favor should be shown to one who looks to his own gains rather than to the interest of his *cestui que trust''*

In *Bartlet and wife*vs. *Lewis et al.,*heard at Sumter, June, 1860, the precise question, now under discussion, as to the correct mode of stating the accounts of administrators, &c., in this particular, was .made by exceptions to the Master’s report, which had adopted and recommended the mode of statement which is here maintained. The Chancellor, who heard the cause, overruled the exceptions and confirmed the report in this particular. " There can be no difficulty,” he says, *“*on the part of an administrator, or other trustee, in so keeping a record of his receipts and payments as to enable a competent accountant readily to make up an account current of the whole administration of his trust. A receipt of money is a single fact, as is a payment. It is only necessary to .record the date, amount, the person to or from whom, and on what account. The only strictly proper method of stating such an account is to charge each receipt of payment *323according to the truth — that is, the amount, and at the date at which it was actually made. All other methods, such as charging the sale-bill in gross, &e., are but occasional substitutes for this, recommended in particular instances, by considerations of convenience, or rendered necessary by the failure of the accounting parties to furnish the information requisite for the better method. The Commissioner, in conformity to the truth of things, as evidenced by the returns and vouchers produced by the administrator himself, charging not the sale-bill in gross at its maturity, but the proceeds of sales at the various times, and in the amounts as actually received, has stated the administration account upon correct principles.” An appeal was taken, assigning error in the decree^ in this and other particulars touching the statement of the accounts. It is stated at the bar, on , the present occasion, and not denied or doubted, that the decree was affirmed. Rut the records of the Court of Appeals, of that date, have been destroyed.

The judgment in *Thackum*v. *Longworth*is understood to rest entirely upon the supposed distinction between choses in action which belonged to the intestate in his lifetime, and have come to the hands of the administrator as part of the ' original assets, and bonds, notes, &c., taken by the administrator, payable to himself, at a sale by him of the goods, &c., of his intestate. And this distinction is(, in its turn, there rested on the proposition, that, upon a sale by the administrator of his intestate’s goods, &c., the law charges him with the amount of the sale-bill in gross at its maturity, as so much money then received, and not with the securities taken by him as assets in a converted form yet to be administered. The securities, it is therefore argued, must be his own property, or, at the least, subject, much more than the original assets, to his power of disposition and alienation. And as the judgment in that case cannot stand with that to which this Court has come upon the present occasion, it has *324been considered proper to discuss, even thus extensively, tbe propositions which thus seem to constitute its foundations.

It bas been seen that, upon an offer by an administrator .to sell or pledge the cboses in action belonging to bis intestate’s estate, tbe party witb whom be proposes to deal bas tbe right to presume, in tbe absence of knowledge to tbe contrary, that tbe proposed alienation is for the purposes and in tbe due course of tbe administration. This presumption is founded, as bas been stated, upon tbe nature of tbe trust and its consequent exigencies, and tbe impracticability of any successful investigation by third persons into tbe actual state of those exigencies. Representations of the administrator, concurring with this presumption, cannot add to its legal force, or constitute any independent security to tbe purchaser, &c., in bis dealings. If tbe presumption were not fairly authorized by tbe nature of tbe case, and affirmed by tbe law, no such representations could, in themselves, constitute a protection to tbe purchaser, &c., against tbe equities of tbe parties in beneficial interest.

If tbe law could have regarded it as reasonable to *aU*tribute such effects to representations of this kind, there would have been no need of tbe presumption, and tbe rule could never have grown up. Let it be supposed that, instead of such presumption, there bad been exacted by tbe law from every purchaser, &c., a diligent *bona fide*inquiry into tbe condition and necessities of the estate, with a view to ascertain whether tbe proposed alienation was required by its present wants. Would taking tbe mere representations and statements of tbe administrator satisfy such an exaction ? Jealousy and doubt of tbe administrator would be tbe only foundation of such an exaction, and these could, of course, not be thus satisfied. For be who would violate bis trust and deal dishonestly or unfairly witb those for whose use be bolds tbe property, would not *325hesitate to make the representations necessary to the success of his inequitable purpose. The impracticability of such inquiry — because, to make it of any value, it must be pursued through independent sources of information — is the very ground of the legal sufficiency of the presumption which takes its place. The security of the purchaser is therefore precisely the same, ■ whether the administrator speak or be silent.

When it has once become known to the persons, to whom the offer of sale or pledge is made, that-the immediate purpose of the administrator therein is to apply the money, to be paid or advanced, to his own private use, whether in payment of his individual debt, or otherwise for his personal necessity or profit, the burden of the peril is, *eo instante,*shifted. Up to this point the law imposed the risk of the administrator’s fidelity upon the parties interested in the estate. But it is now, *prima facie,*ascertained that he is proposing a breach of his trust, and, if there be any facts in the condition of the estate which can rebut this *prima*facie, the purchaser must take the *onus*of showing it. He assumes this risk. There is no presumption authorized by law, arising at *any*point of time, that the administrator is in advance for the estate, and, therefore, entitled to appropriate to his own use the assets for his reimbursement. Some expressions, apparently to this effect, may be found in the language of a' few judicial opinions, but they are, in every instance, where observed, incidentally introduced, and do not represent any deliberate judgment upon a point made. No case has been found affirming such presumption as matter of law. If any such further presumption as this were adopted by the law, the last guard of the rights of the creditors and distributees, against the misdealing of the administrator, apart from his personal responsibility, would be almost wholly gone. Only in the most narrowly restricted class of exceptional cases would any responsibility, *326on the part of the purchasers, &c., dealing with the administrator, remain. But there is no foundation, in the nature of things, for such a presumption. It would do violence to probability. A *sale*is, *prima facie,*a necessity for the purposes of the trust, and may be a duty for the interests of the parties beneficially concerned. There is, therefore, a probability that, when proposed, it is for the execution of the trust, and hence the presumption which the law recognizes and supports. But an advance, by the administrator, of his own money, is neither a necessity nor a duty.

Time is given him to ascertain and provide means for paying the debts. Nor is such an advance according to the *ordinary*course of human conduct in business affairs. But if a party, uniting with an administrator in a *prima facie*misapplication of the assets, can lean for his justification on no such *presumption*of law, still less can he find exemption from liability in any representations of the administrator as to the state of his accounts. He who permits himself to be seduced by the representations of a trustee, to engage with and aid him in what is, *prima facie,*a breach of his trust, must bear the risk of the trustee’s truthfulness and accuracy. If the representations to which he listened turn out to be false, the consequences of his credulity ought to fall on himself who trusted them, and not to be thrown on those whose rights are independent of the trustee’s title and not derived through him.

The credulity which accepts representations, aud even written exhibitions, of the state of an account, as a foundation for confidence in venturing upon dealings otherwise of doubtful propriety, is the less excusable at this day when the world has grown familiar with the facility wherewith adepts in the science of accounts can successfully cover up, under the magic of formal entries, the misappropriations of years, until, by the mere weight of their accumulations, they burst the bonds of concealment. The present state of *327society furnishes a weighty admonition against any relaxation of the obligations of fiduciary responsibility, and a motive to strictness in the application of existing principles on this subject to conditions not heretofore expressly provided for by positive adjudications. And although this Court does not undertake the office of a reformer, it is eminently proper that all judicial tribunals should, in the exercise of their appropriate functions, exert a conservative, if possible, an elevating, influence upon the tone of public sentiment, the more effective because silent and incidental. A foreign essayist of the day, referring to the present moral tone of society, says: *“*The increase of dishonesty in all classes is appalling. This is true ,not only in the great banking system and in the railway companies, but among tradesmen and shopkeepers, with whom cheating is beginning to be the rule, and honesty the exception.

*“*The *crime*of society may be a scar upon its surface, but its *commercial corruption*is the rottenness of the bones. The fact that the offenders are not of the criminal class, not outcast wretches, born of races of thieves, but wealthy speculators, living in splendor, rich tradesmen, keeping up all the outward show of respectability, subscribing to charities and attending churches — this fact is what makes the matter so terrible.” Happily for us, this is, as yet, no true picture of *our*society. But it may not be forgotten that most powerfully conservative elements are now disappearing, active principles of corruption are being imported and infused, and the process of disorganization is advancing with constantly accelerating speed. “It has become a crying evil in our times,” says the late Ch. Wardlaw, in *Spear*vs. *Spear,*9 Rich. Eq. 184, “ that persons seek trusts, especially administration and guardianship, not for the good of those beneficially interested, but for the accommodation of themselves and their sureties and other especial friends. This is in flagrant violation of the rules and doc*328trines of equity concerning trusts.” The true and proper policy of the Courts, in reference as well to the highest moral interests of society as to the material interests of the vast number of merely beneficial owners of property, whose protection constitutes so large a branch of equity jurisdiction, requires that, in moulding the system of doctrines which there obtained in respect to the rights and duties ,of fiduciary relations, any encouragement which the prospect of legal impunity gives to unfaithfulness or dishonesty shall be reduced to the lowest practicable limit, and that the powers of those who have the rights and interests of such merely beneficial owners in their keeping shall be subjected to as strict restraints as can consist with the efficiency of such keeping.

In relation to the particular subject now under consideration, the *insolvency*of the administrator at the time of. the dealing which is called in question in any case, seems to be important only in two points of view. It has been stated that he who would maintain his purchase of the assets from the administrator, must have given a valuable consideration, as well as bought *bond fide.*If the administrator is in fact insolvent, and his creditor takes from him assets of his intestate, in satisfaction of a debt which he could not otherwise collect, or could only in part collect, then he does not give value in exchange for the assets, and shall not keep them, even though he does not know them to be assets. And when, under such circumstances, the purchaser, mortgagor, &c., does know them to be assets, whether taken in satisfaction of a private debt of the administrator, or for full value* in money paid at the time, to be used within the knowledge of such purchaser for the administrator’s private purposes, this insolvency, if known to him, constitutes an aggravation of his *malafides,*because it enhances the peril in which he puts the interests of the beneficiaries; but is not of its *essence,*for that consists in *329his knowledge of the intended misapplication and his cooperation in the administrator’s breach of trust.

The nature of an administrator’s title or estate in the assets, as recognized both at law and in equity in its present shape, to which it has been gradually moulded by the process of statutory modifications of the common law; the rights and equities of those for whose benefit it is vested in him, against himself and strangers dealing with him, and, through such beneficiaries, of those who are pledged to them for his fidelity; the origin and reason of the large power of disposition which the early law gave him; the gradually but steadily ■ tightening restriction thereupon, which the progress of society, as affecting the reasons therefor, has produced, and the present exact definition of this power; the consequences, in the present state of the law, of a conversion of the specific assets by sale under competent authority, to this official responsibility; the relations of the administrator to and his power over the securities taken at such sale, if on credit; the grounds and the exact limit of the presumption which the law authorizes as to the purposes of his alienation, for the protection of those to whom he aliens; and the relations of the whole subject to a sound social morality, have been thus patiently, doubtless to readers tediously, passed under examination, with a view to bring out distinctly the precise rule of the liability of strangers dealing with the administrator for the assets in his hands, even though it be in their converted form after gale. The examination and discussion are supposed to have established the following propositions:

1. No valid alienation of an intestate’s *personal chattels or visible effects*can be made by an administrator without a previous order of the Court of Equity or of Ordinary.

2. A valid alienation, by way either of sale or pledge, of the *choses in action*belonging to the intestate’s estate, may be made by the administrator, of his own motion, to *330any one who takes them, *bond fide*and for full value, not grossly inadequate, and upon *such*alienation they will be discharged of all equities which attach upon them merely as assets.

3. An appropriation by an -administrator of the assets of his intestate to his own private use is, *prima facie,*a breach of trust, and a fraud upon the rights of those interested in the estate; and he who, knowing the purpose of the administrator so to appropriate them, purchases them from him, or advances him money upon their pledge, whereby the fraud is actually consummated, takes them *mala fide.*

4. The securities taken by an administrator at a sale by him of the intestate’s estate, for the assets sold, payable to himself, are, equally with the choses in action which the intestate held at his death, under the protection of this ■ restriction on his power of alienation.

5. The' creditors and distributees of the intestate have an equity as against the administrator, that the assets shall -be applied exclusively to the purposes of the administration, which, in the Court of Equity, will be specifically enforced, when necessary, for their protection, and this equity follows the assets or their value into the hands of any -one who takes them from the administrator *mala fide,*or without valuable consideration.

6. The surety of an administrator who has been com-: pelled to answer to the creditors and distributees or either for the default of the administrator, resulting from his misapplication of the assets, is entitled to be subrogated to this .equity, and have it enforced for his indemnity against one who has knowingly contributed to the default by taking from the administrator the assets *mala fide,*or without value.

7. When once it appears that the purchaser, &c., knew that the administrator was applying the assets to his own *331use, he is *prima facie*concurring in a breach of his trust and a fraud upon the creditors and distributees, and if there is any thing in the facts which justifies such a use of the assets, the burden is on such purchaser, &c., to show it. He takes the risk of the truth of any representations, made by the administrator, of the existence of such facts, and if those representations prove false, he must bear the consequences.

The facts of the case before the Court which has occasioned this discussion, so far as necessary to be stated, in order to show the application of these principles to its disposition, may be thus summed up. Under an order of the Ordinary, the personal estate of Leonard White was on 26th December sold by the administrator, William Lewis, one of the present defendants, on a credit of twelve months, and notes under seal, payable *“*to William Lewis, administrator of the estate of Leonard White,” were taken from the purchasers. Among the securities so taken, were the three sealed notes of Thomas M. Dick and others, mentioned in the pleadings, amounting in the aggregate to a principal sum of $10,275, on which interest ran from the day of sale. In December, 1858, Lewis, desiring to purchase at certain estate-sales of negro slaves, which were to be made on credit, for bonds or notes with surety, in the beginning of the following year, applied to his present co-defendant, John R. Pollard, to become his surety on his bonds or notes to be given for such purchases as he would then make, and promised to transfer to or deposit with him, for his indemnity against loss by reason of such suretyship, these notes' of Thomas M. Dick and others which he held as administrator. Pollard consenting to this arrangement, Lewis made sundry purchases of slaves, and executed these several securities to different persons, with Pollard as his surety on each, amounting in the whole to $11,635, and, in fulfilment of his promise, delivered the three notes of Dick to Pollard, *332for which the latter gave him a receipt, acknowledging that they were to he applied, when collected, to these bonds and notes on which Pollard had thus become Lewis’ surety. "Various payments were thereafter made to Pollard or to his use on these notes, until, at November Term, 1860, of the Court of Common Pleas, the aggregate of principal and interest remaining due on them had been reduced to $3,944.82, for which sum judgment was rendered at that term, on said notes in favor of Wm. Lewis nominally, (but really intended for the use of Pollard,) and shortly afterward the sum of $1,134.78, part of said recovery; was paid to Pollard. In October, 1860, a decree was rendered in a cause which had been long pending in the Court of Equity, for the settlement of the administration account of Lewis, and a distribution of the residue of the estate of his intestate, Leonard "White, which decree found a balance of $14,353.15 to be due by Lewis on his accounts to the distributees, besides some $1,733.04 to judgment creditors of the estate. This balance continuing unpaid, suit was soon after instituted on Lewis’ administration bond against the present plaintiff, Levi F. Rhame, as surety. Rhame subsequently paid of the recovery against his principal, Lewis, in divers sums at various times, the aggregate sum, in all, of $14,372.13. Pending the suit against him on the administration bond, he brought his present bill to set up and enforce, for his indemnity *pro tanto,*the equity of the creditors and dis-tributees whom he was bound to pay against William Lewis, his principal, and John R. Pollard, as the alienee of Lewis, to have the Dick notes, which had been so transferred to Pollard, applied as assets of the estate of White for his relief to the satisfaction of the recovery of the distributees and creditors of White against Lewis on his administration' account, or to the reimbursement of what he, (Rhame,) as surety, was liable to pay, and has now paid thereon.

At the time of the arrangement between Lewis and Pol*333lard, in pursuance of -which the Dick notes were transferred to, or deposited in pledge with the latter, Lewis told Pollard that he was in urgent want of the money, and had failed in his efforts to raise it, and that his purpose in purchasing the negroes was to supply this need by re-selling in the West for cash. The brief does not inform the Court (and the counsel on neither side was able at the argument to supply the omission) whether any such resale was ever made or attempted, or whether the negroes then purchased did not remain in Lewis’ possession until emancipation set them at' large. At the same time, Lewis also represented to Pollard that “ he had made such large payments to the distributees of Leonard White out of his own funds, that, when the estate was wound up, the distributees would fall in debt to himin order to convince him that the Dick “notes were his own, property,” he exhibited a written statement of his administration account to Pollard, and told him that " he had shown his accounts to some of the distribu-tees, and they were satisfied with his statement and showing.” As his account was afterwards made up,.it appeared that, from the end of the first year of his administration, (1853,) there had always been a balance against him, of never less than $3,000, and generally from $7,000 to $8,000 ; that, at the time of these representations, (January, 1859,) there was due by him, to the estate of his intestate, over $18,000, and that, having begun the preceding year (1858) with a balance against him, on the 1st January, of $6,340.33, he had paid out during that year only $6,297.48, and had received $18,252.17.

Even if, as is probable, the Dick notes are in the account charged against him in the receipts of that year, and help to make this large aggregate, there was, over and above them, at the time of his statement to Pollard, a balance of about $7,000 of the estate’s money in his hands.

And in a little more than a year afterwards, when his *334final account was made up in tbe Court, be was found to owe a balance of over $16,000, including outstanding judgments.

In tbe interval between his representations to Pollard and his final accounting, bis aggregate payments on account of bis administration were only a little over $3,000, being less than half tbe balance then in bis bands, even if tbe Dick notes bad not been charged to him, but bad been retained for, and as part of, tbe unadministered assets for distribution.

From 1847 to 1861 there were entered, in tbe office of tbe Clerk of tbe Common Pleas for Sumter, 129 judgments against William Lewis, and during Frierson’s sheriffalty, .(from 1856 to I860,) there were in bis office " a great number of executions, against Lewis, of large amount.” In January, 1859, tbe date of tbe transfer to Pollard, there were open and unsatisfied executions against him to tbe amount, in tbe aggregate, of $23,000, including one for tbe enforcement of a judgment by confession to one Norton for $8,280, with interest payable annually from May 20, 1854, which was also further secured by a mortgage of tbe land for tbe purchase of which tbe debt was contracted. Just before tbe transfer to Pollard, Lewis mortgaged to one Crane a tract of six hundred acres of land and twenty-one negroes —“ *constituting the whole Lewis was supposed to own not already under*mortgage.”

The other negroes be bad in bis possession belonged to bis wife and children. It thus appears, that all bis visible property was at this time under mortgage, and there were besides unsatisfied judgments to a large amount against him — and most, if not all, of this must have been matter of public record. He told Pollard “ be desired to raise money, but that *he could not borrow it out of the*banles, and *had tried private individuals and could not get*it.” He testifies that, “when be gave bond to Crane,” (January, 1859,) “be could *335have given bond for $50,000 and given one hundred of best men as his sureties. Pollard was his surety on one of his official bonds.” On that occasion, so far as appears, and as indeed seems implied, although his official bond must have been for a large amount, no indemnity, or counter security was exacted. But extraordinary efforts and urgent representations and offers of indemnity are in fact deemed by him necessary, at the very time of his arrangements with Crane, to induce one (of the “ one hundred ”) to become his surety for $12,000 — and Pollard, advertised of the extraordinary straits he is in for want of money, and the unusual and hazardous shifts to which he is about to resort to raise it, thinks it important to be secured against so comparatively small a liability.

It is quite manifest, from this statement, that the Dick notes were the property of the estate of Leonard White— assets in a converted form; that Pollard, at the time of their pledge to him, knew this, because it appeared on the face of the notes and was avowed, or necessarily implied, in the painstaking statements of Lewis; that Lewis, in the transfer of them, was in fact applying them to his private uses, and Pollard knew that he was so doing; for whether it be considered that they were employed in the purchase of slaves, this was plainly no part of the administration of Leonard White’s estate, and so could not be in execution of his trust, but, on the contrary, was for an “ object with which the intestate’s affairs had no connection;” or, Lewis’ declaration of his purpose in buying the negroes be accepted, he made it certain he was raising the money for his own private purposes, exclusively, by his zealous and careful effort to convince Pollard of his right to use the notes, which use would have needed no such labored justification as he tendered, if the money, to be thereby raised, was intended to be employed for any legitimate purpose of his trust.

*336The use made by the defendant, William Lewis, of the three notes of Thos. M. Dick and Eobert J. Dick, mentioned in the pleadings, was a clear breach of his trust as administrator of the estate of Leonard White, and his co-defendant, John E. Pollard, knowing of his purpose so to misapply them, and aiding him in its consummation by taking the notes from him, acquired his possession of them, and of their proceeds since, so far as collected, *mala fide.*Had they been retained and applied, as they ought to have been in a due course of administration, the balance due by Lewis on his administration account would have been greatly less than it was found to be, and indeed comparatively trifling, and the liability of the plaintiff, as his surety, would have been correspondingly reduced. The large increase, thus resulting from this breach of trust, of Lewis’ indebtedness to the distributees and creditors, for his default in payment of which the present plaintiff, Levi F. Ehame, has been or will be compelled to answer, is a damage against which he is entitled to be indemnified by recalling the misappropriated assets or their proceeds from those who wrongfully ■possessed themselves of them, and this is the relief he asks. This Court is of opinion that the Chancellor below erred in dismissing the plaintiff’s bill, and that his decree to this effect ought to be reversed, and so it is ordered and adjudged.

It is further ordered and decreed, that the defendants, William Lewis and John E. Pollard, their agents, attorneys, and servants, and each of them, and the agents, attorneys, and servants of each, be, and hereby are, perpetually enjoined from collecting or receiving, by themselves or himself, or any other, for their or his use, any part of the balance remaining due on the judgments recovered in the Common Pleas, in the name of the said William Lewis, against William Edward Dick, as administrator of the estate of Thos. M. Dick, and against Eobt. J. Dick, severally, *337on the said three sealed notes (¡or any of them) of Thos. M. Dick and Robt. J. Dick, mentioned in the pleadings; and the said Robt. J. Dick and ¥m. Ed. Dick, administrator, be in like manner enjoined from in anywise paying the same, or any part thereof, to the said ¥m. Lewis, or Jno. R. Pollard, or any one for the use of them or either of them; that the said balance remaining due on the said judgments be paid into the hands of the Commissioner of the Court of Equity for Sumter District by the said Robt. J. Dick and ¥m. Ed. Dick, administrator, and the officers or officer who shall collect the same; that the said Commissioner take an account of all moneys received by the defendant, John R. Pollard, in part payment of the said three sealed notes of Thos. M. Dick and Robt. J. Dick, mentioned in the pleadings, after their transfer to or deposit with him in January, 1859, or of the judgment recovered on the same, the times when received, and the currency in which, with interest on each sum so received from the date of its receipt, and the present value, in lawful money of the United States, of any of the said sums that were received, if any, in Confederate treasury notes, having respect, in estimating such value, to the provisions of the Ordinance of the Convention of September, 1865 — “To declare in force the constitution and laws heretofore in force in this State,” &e., in the first proviso in the fourth section thereof; that the said defendant, John R. Pollard, pay into the hands of the Commissioner aforesaid the aggregate sum of principal and interest which shall be so found to have been received by him. when the same shall be finally ascertained by the confirmation of the Commissioner’s report; that the said Commissioner also take an account of the payments heretofore made, or that shall be made, by the plaintiff, Levi E. Rhame, by reason of his liability, as surety, for the said William Lewis’ administration of Leonard White’s estate, the particular circum- . stances under which, the times when, and the currency in *338which the said payments were made, and the present value, in lawful money of the United States, of any said payments that were made, if any, in Confederate treasury notes, respect being had to the provisions aforesaid of the Ordinance of the Convention of September, I860, and also of any still outstanding liabilities of the said estate of Leonard White, or of the said William Lewis, as administrator thereof, to creditors or distributees; that out of the funds, to be so paid into the hands of the said Commissioner, from the several sources herein mentioned, he pay, *first,*all such liabilities, of the said estate of Leonard White, to creditors or distributees, as shall be so found still outstanding, and, *then,*such amount as shall be found upon the account herein ordered, when finally adjusted, to be due to the plaintiff, Levi F. Rhame, for the payments, with interest on each from its date, that have been made or shall be made by him by reason of his liability, aforesaid, as surety for the said William Lewis’ administration of the estate of Leonard White, and then the surplus, if any, to the defendant, John R. Pollard.

Wardlaw, A. J., Munro and Dawkins, J. J., and Le-sesne and Johnson, C. 0., concurred.

Dunkin, Oh. J., Glover, J., and Carroll, C., dissented.

Moses, J., having been of counsel, did not sit.

*Decree reversed.*