#### Daniel Thomas, *Administrator of*Wm. Johnson, *vs.*John Gage, sen. & Harmon Johnson, *Administrator of W. Johnson.*

*The defendant J. G. one of the heirs and' distributees of the estate, purchased property at the administrator’s sale and gave his. note for the amount,*$815. *One of the administrators (the defnd’t II. J.)whowas indebted to G.*,$412 *ona judgment. II. J. who was m embarrassed circumstances, as was known •to G. gave G. a receipt against his note, then in the possession of the other administrator, the complainant, upon his entering satisfaction on- the judgment and giving a new note for the balance, which II. J. disposed of to his private use. G. had a demand against the estate, on which he brought suit at law. The other administrator offered G’s note as a set off, which was rejected on the production of II. J’s. receipt, and G. recovered a judgment. Decreed that G. shoidd cometo an account with complainant, in which he should not be allotoed credit for the amount of his judgment against TI. J. that the entry of satisfaction should be vacated, and the judgment stand revived; against H.*J.'

*The bill alledged that defendant G.*was *indebted to the in-, testate, in his life time, for cotton sold,*&c. *This the answer of G. admitted, but stated that he had accounted with the intestate and paid the debt. Referred to the commissioner: Com-, plainant to be at liberty to support the demand byprooj, and the Commissioner to receive G’s answer as evidence.*

Chancellor *Desaussure.*— On the death of Col. Wm. Johnson, intestate, he left six children, one of whom married the complainant D. Thomas, and another of whom married the defendant, John Gage, senr. Daniel Thomas and Harmon Jonson, a son of the deceased, administered on his estate; and they made a sale of the personal property, by an order from the Ordinary, on the 18th Noy. 1819. The sales amounted to $8118, 93. Most of the heirs made purchases at the sale; John Gage to the amount of .$815; Harmon Johnson to the amount of $1013 65; the complainant, D. Thomas, to the amount of $1973, and the other heirs to various amounts. The whole of these purchases by the heirs, ’amounted to $7685 56. The estate was stated to be in debt to the amount of between 4 and 5000 dollars; to pay which, it is stated by *198Complainant that it was agreed the lands should be sold; arid they were accordingly sold under a process for partition.

The defendant, John Gage, gave his note for the amount Of his purchase, to the administrators Daniel Thomas and Iiarmon Johnson.

John Gage brought suit against the administrators, to recover a private debt due to him by the deceased, and established his demand. At the trial of that cause, the defendant Daniel Thomas offered as a discount, the note of the said John Gage, given for the amount of his purchases at the sales of the estate, to the administrators. But John Gage produced a receipt in full against the said note, given him by Harmon John* son, one of the administrators; which was supported, and thereby defeated the discount set up of said note; and John Gage obtained a verdict and judgment for $808 49 against the ■said estate, beside interest and costs. One of the objects of the bill is to set aside the said receipt, and to restrain the defendant John Gage, from enforcing his judgment at law: because it is alleged the said receipt was given by Harmon'Johnson and accepted by John Gage, in order to deceive and to defraud the heirs of the intestate, Col. Wm. Johnson. That the said receipt was not given on account of any actual payment made by Gage, of his note to the administrators, but because Harmon Johnson was indebted to said John Gage the amount of ,$412 36, and that Gage on obtaining the receipt, gave his note to said Iiarmon Johnson for the balance. And it was insisted that the said receipt itself was antedated, in order to give it effect.

The answer of the defendant Gage, denies that the note was antedated; and there is no proof of tiiat allegation to contradict the answer- But the defendant admits that Harmon Johnson, being indebted to the said defendant in the sum of $412 36, gave him a receipt in full for the above note, and took a new note for the balance; which he understands the said Harman has since passed away to pay a private debt of his own. Defendant insisted on the power of the administrator Harmon Johnson to act as he did, and relies on the judgment at law* *199establishing his demand, notwithstanding the said note of Gage to the administrators, then in the hands of the complainant Daniel Thomas, was set up on discount.

The general doctrine on this subject is, that -in many respects and for many purposes, third persons are entitled to consider executors and administrators as complete owners of the estate in their hands. See *Madd.*286, *and*7 *Ves.*166 & 209. The object of this policy is to prevent the general inconvenience of entangling persons in enquiries after the application by ex’ors. of the money of the estate. See 2 *Vern.*444, *Stumble*vs. *Bill,*the doctrine of which case appears to have been followed though the decree, was reversed by the house of lords. See 1 *Bro. P. C.*74, and other cases cited in the note *q.*to page 286, 7 of 1 *Madd.*But if a person dealing with an executor is aware that an executor is misapplying the testator’s propertjq a court of equity will,, in a strong case, interfere in behalf of persons beneficially entitled.' As if one concerts with an executor to misapply the assets-, by paying the private- debt, bf the executor, such concert will involve the person so concerned and make him liable. See 1 *Ves.*105,- 3 *Bro. G. C.*626j 3 Ves, 95.; 4 *Ves.*665; *and*17 Ves. 167; 1 *Coco.*145.

In the case we are considering, the defendant, Gage, knew that the estate was in debt; he also knew that Harmon Johnson^ one of the administrators, was not in good circumstances; and.he had reason to know that the note was in the hands of the. other' administrator, Daniel Thomas, for Harmon Johnson could not produce it, but gave him a loose receipt. Under these circumstances, I think he ought not to have taken a receipt against his note due to the estate, for a private debt due to him by Harmon Johnson. But the court of law has so far protected him, as to have rejected the discount set up by the administrator, Thomas, against his (Gage’s) private demands against the estate. This court cannot therefore restrain Mr. Gage from enforcing his judgment at law. It may however, without interfering with that judgment, direct an account and settlement of the estate of the intestate, Wm, Johnson, and that in such account, the defendant, Gage, be not allowed the amount of the private debt of *200Harmon Johnson to said Gage, if it should appear that Hai-mon Johnson is'Unable to settle what is due by him to the estate, on his administration account.

Another point in the case was as to certain debts alleged to be due by Gage to the intestate in his life time, for cotton and other articles. The answer admits that the defendant, Gage, had sold some cotton for the intestate, William Johnson, but insists that he had settled the same in his life time; and there is no contrary proof. This seems to be conclusive: But I will give the complainant an opportunity to support such demands-, if he is able, before the commissioner, who shall, in the enquiry, give due weight to the answer of the defendant,

Another point was made as to a mortgage given by Harmon Johnson, to Mr. Mitchell, of his private property, which will sweep away his estate, and prevent his paying the *debt he may*owe *to the*estate, on settlement thereof. But there *were*no previous liens on said property, and the insolvency of Harmon Johnson is not-fully made out, and Mr. Mitchell is no party -in the suit. The court cannot therefore interfere with that mortgage. It was insisted that Harmon Johnson, the late administrator, (who has been displaced by the ordinary) should account for his share in the affairs of the estate, to enable the lacting administrator, the complainant, to make a general settlement: to this there can be no objection.

It was further insisted, that in the general settlement, Mr, Gage should bring into botch pot, the value of the advances made to his wife, by her father, the intestate. The complain’ ants have a right to require this; but in doing so, the rule laid down by the statute ©f February, 1791 is, that the value of the portion advanced shall be estimated at the death of the ancestor, but so.that the increase of the personal estate advanced, shall not be taken into the computation; and this rule must be followed.

It is therefore ordered and decreed, that the administrators, Daniel Thomas and Harmon Johnson, and all parties beneficially interested in the estate, do come to an account before the commissioner; and that in such account, the private demand *201oí *Gage,*against Harmon Johnson, the administrator, be not allowed him against the estate; and that enquiry be made what Harmon Johnson has done with the note given him by Gage, for the balance due the estate; for which Gage shall not however be responsible to the estate, if he has paid it to any holder thereof; and that complainant be at liberty to support by proofs, any demands of the intestate against said Gage, the defendant; and that in the settlement of the estate, the advances made to Mrs. Gage, by her brother, be brought into account, under the restriction of the statute 1791; and that Mr. Gage be credited the amount of his judgment at law, unless paid to him by the administrator, since the judgment was obtained.

The defendant Gage appealed;

1st. Because the case made by the bill and answers had been fully heard and determined by the court of common pleas;

2nd. Because the transaction between the defendant Gage and Harmon Johnson was bona fide; at least it was so on the part of Gage:

3rd. Because the complainant was too late in applying to this court for relief:

4th. As by the decree of the Court, the defendant Gage was not allowed credit for the amount of his judgment against Harmon Johnson, on which he had entered satisfaction by way of payment on 1ns note to the administrators, the court ought at all events to have decreed his entry of the satisfaction to be vacated and the judgment to stand revived against Harmon Johnson.

A. *W. Thompson,*for appellants,

as to the jurisdiction of the court after the trial at law, cited 3 *Johns, K'h. Ca.*355; 3 *Eq. Re.*324, 5; 7 *Crunch,*336; 2 *Johns. Ch. Ca.*557; 6 *Johns. Ch. Ca.*87; 1 *Johns. Ch- Ca.*555; 1 *Madd.*77. Contended that the case of a party combining with the executor to misapply the funds of the estate was not made out by proof, and there was a difference in the application of the doctrine to executors and to administrators who give security.

*Chancellor Resaussure*

*delivered the opinion of the -Court,*

*202*A. W. Thompson,*for appellants.

*Williams,*for respondents.

We have considered this case with the attention due *to*it, and are of opinion that the decree is correct as far as it goes.. But we think that in opening the case as the decree does, it should have gone further, and decreed that the satisfaction entered on the judgment of Gage against H. Johnson should be set aside and the judgment revived. It is therefore ordered and adjudged, that the decree of the circuit court be affirmed, but that the satisfaction entered on the judgment against H. Johnson be set aside, and the judgment revived and be regarded as though satisfaction had not been entered thereon.

Chancellors *Gaillard, Waties*and *Thompson*concurred-