Chew vs. Hyman. If this was a judicial sale, I hardly need cite authorities to show that the owners of the fee burdened with the indebtedness which the complainant sought to make out of this real estate, were necessary parties to the suit. But it is urged that equity rule 49 dispenses with the necessity of making these devisees parties to the record. This rule reads as follows: "In all suits concerning real estate, which is vested in trustees by devise, and such trustees are competent to sell and give discharges for the proceeds of the sale, and for the rents and profits of the estate, such trustees shall represent the persons beneficially interested in the estate, or the proceeds, or the rents and profits, in the same manner, and to the same extent as the executors or administrators in suits concerning personal estate represent the persons beneficially interested in such personal estate; and in such cases it shall not be neces sary to make the persons beneficially interested in such real estate, or rents and profits, parties to the suit; but the court may, upon consideration of the matter upon the hearing, if it shall so think fit, order such persons to be made parties." The question then in this case is, was the fee of this land vested in the executor, so as to make this rule applicable? The will certainly does not vest it in the executor by its terms, and therefore it seems to me the rule does not apply. The power with which the executor is clothed by the will is purely discretionary. The executor could not be compelled to act. He was clothed simply with the discretionary right to sell the real estate outside of the state of Virginia, and re-invest the proceeds. Until the executor exercised this discretion, to sell for the purpose of re-investment, the fee of this land remains in the children, the devisees under the will, and there is no clause or word in the will intimating that the testator intended that the executor should take the fee; when the executor saw fit to sell for the purpose of re-investment under the powers Chew vs. Hyman. with which he was clothed that passed the fee out of the children as in the case of a power given any agent to sell real estate under a letter of attorney from his principal. "Mere powers are purely discretionary with the donee. He may or may not exercise or execute them at his sole will and pleasure, and no court can compel or control his discretion, or exercise it in his stead or place, if for any reason he leaves the power unexecuted. It is different with powers coupled with a trust, or which imply a trust.”1 So in Taylor vs. Benham, 5 Howard, 269, the Supreme Court of the United States says: "One of the tests on this subject is, that a naked power to sell may be exercised or not by executors, and is discretionary; while an imperative direction to sell and dispose of the proceeds, as in this case, is a power coupled with a trust." So in Story's Equity Jurisprudence, § 1070, the rule is stated in these terms: "In the nature of things there is a wide distinction between a power and a trust. In the former the party may or may not act in his discretion; in the latter a trust will be executed notwithstanding his omission to act.” But it is urged further that this sale has been ratified by the executor, by the receipt from Hughes of the proceeds of the sale made to Hyman. The answer to this seems to me to be: 1st. The executor received this money from Hughes under false statement that the property had been sold at a forced sale under foreclosure proceedings, when in fact it was a mere colorable sale consented to and managed by Hughes as the agent of Washington, and where there was no compulsion about it—a sale made simply by arrangement. 2d. The executor being only empowered to sell for the purpose of re-investment, he could not ratify a sale not made by himself under the powers, so as to bind the devisees under 'Perry on Trusts, Sec. 248. Chew vs. Hyman. the will, if they were necessary parties to the suit. The fact that the executor received the remnant of the proceeds of the property left after the sale made in pursuance of the decree of the court in that case, cannot, it seems to me, be held to ratify a sale which he had no agency in making, and which he did not pretend to make under the powers with which he was clothed. It is further suggested that there has been undue delay in the bringing of this suit; but the proof shows that all these complainants were minors at the time these proceedings were had; that they did not learn of the fact that the property had been sold, or in any way disposed of, until 1871, at which time those who were of age, the age of 21 years, were married women, and continued such until this suit was brought. There does not seem to me, therefore, to have been any such delay in the bringing of this suit as makes this proceeding what might be called a stale proceeding within the meaning of the equity cases. It does not come within any of the limitation laws of the state of Illinois, and it seems to me it is not such a claim as should be considered stale. The other defendants in this case, Barling, Davis and Mandell, claim a title under Hyman, and have no better standing in court than he. Under all the facts in this case, therefore, and under the law as I think it should be applied to these facts, these complainants will be entitled to a decree allowing them to redeem these premises, upon such terms as are equitable under all facts in the case; and those terms will be: That they shall pay the amount due on the Williams trust deed, with the interest from the time it fell due, at the rate called for by the bond. In other words, Hyman should be subrogated to the position of Mrs. Williams in the case. He should also receive six per cent. upon the balance of the money which he has paid, from the time he paid it, including Sill vs. Solberg. the amounts paid by him for taxes and assessments, and for permanent improvements upon the premises; Hyman accounting for all rents and profits received by him for the land, which should be deducted from the amount so found due him. A decree will be entered accordingly. WILLIAM R. SILL, ASSIGNEE, ETO., VS. CHARLES B. SOLBERG. CIRCUIT COURT-WESTERN DISTRICT OF WISCONSIN-APRIL, 1881. IN EQUITY. 1. EQUITY JURISDICTION-BANKRUPTOY-SUIT BY ASSIGNEE.-Where it was arranged between the bankrupts and another party that the assets of the bankrupts should be exclusively applied in the payment of one debt for which such other party was contingently liable, instead of applying them pro rata upon all the liabilities of the firm; and the assignee sought by proceedings in equity to charge such other person with the money and assets so used: Held, that the court of equity had jurisdiotion. 2. FRAUDULENT PREFERENCE.-Such application of the bankrupts' assets constitutes a fraudulent preference within the meaning of the Bankrupt Act. 3. PREFERENCE-TRANSFER OF ASSETS TO INDORSER.-If, in advance of his liability being fixed, an indorser takes the bankrupt's property to meet the note which he has indorsed when it shall mature, or to secure himself against loss, he will be liable as accepting a preference. C.W. Bunn, for complainant. Sill vs. Solberg. S. U. Pinney, for defendant. DYER, J.-This is a demurrer to a bill in equity brought by the complainant as assignee of Wilson & Kiene, bankrupts. The bill sets out the following state of facts: On and prior to the twenty-ninth day of August, 1878, Wilson & Kiene, as copartners under that firm name, were doing business in La Crosse as retail dealers in pork, ham, lard, etc. On that day they were adjudicated bankrupts, and the complainant was subsequently appointed assignee. On the twenty-eighth day of August, 1878, the bankrupts were indebted to the La Crosse National Bank in the sum of $5,000, as the makers of a promissory note, dated May 30, 1878, payable to the order of the bank, and due August 31, 1878, and on which the defendant, Solberg, was indorser. The bankrupts were also at that time largely indebted to various other persons, and had not sufficient property to pay their indebtedness, nor did they have bankable assets with which to pay their note held by the bank, of which fact the defendant had knowledge. This being their condition on the day mentioned, August 28th, Wilson, acting for the firin, but without the knowledge or consent of his partner, sold and delivered to the defendant their entire stock in trade, alleged to be then worth $3,000, and in payment therefor took the defendant's note for $2,464.14. The defendant was at the same time indebted to the bankrupts in the sum of $1,333.16 on open account, and for this amount he then gave to the firm his note. On that day the bankrupts had in hand $494.30 in cash, and also held notes against various persons, amounting in all to $792.81, all of which defendant indorsed except one note, which, without indorsement, was bankable paper. The bankrupts, or one of them, at the request of the defendant, then took the two notes so made by him, also the notes against third parties which he had indorsed, and the cash |