tees was to enable the security to be created and rendered effectual for the bondholders. The expenses of a trustee in the execution of the trust are a lien upon the estate, and he will not be compelled to part with the property until his disbursements are paid. Perry, § 907. If the trust fund is insutlicient for such reimbursement, he may call on the cestui que trust in whose behalf and at whose request he acted, and recover of him personally reasonable compensation for the time and trouble and money expended. Perry, § 909; Hill, § 578. Trustees have an inherent and equitable right to be reimbursed all expenses which they reasonably incur in the execution of the trust, and it is immaterial that there are no provisions for such expenses in the instrument of trust. If a person undertakes an office for another in relation to property, he has a natural right to be reimbursed for all money necessarily expended in the performance of the duty. Perry, § 910. The costs of winding up a trust and distributing the money, and all expenses for documents, deeds, and other papers must be paid from the trust fund. Id. 933. The trustee's lien cannot be allowed to control the estate in such manner as to destroy the trust; but no conveyance will be ordered or allowed until he is repaid. Id. 907. The concurrence of a co-trustee is not necessary for the incurring of expenses, if the expenses are proper in themselves. 1d. 912."

See, also, Morison v. Morison, 7 De Gex, M. & G. 214; Jones, R. R. Secur. § 547.

That the receiver should have been allowed reasonable fees for counsel employed by him to aid him in the proper discharge of his trust we have no doubt. Cowdrey v. Galveston, H. & H. R. Co. 93 U. S. 352; S. C. 9 Amer. Ry. Rep. 361. That he should be allowed costs of litigation is equally clear. Jones, R. R. § 1547, and cases cited. Expenses in taking care of, protecting, and repairing the property in the receiver's charge should also be allowed. This is so well established by decided cases that we consider it only necessary to cite some of them. Meyer v. Johnston, 53 Ala. 237-346; Hoover v. Montclair & G. L. Ry. Co. 29 N. J. Eq. 4; Kennedy v. St. Paul & Pac. R. Co. 2 Dill. 448; Stanton v. Alabama & C. R. Co. 2 Woods 506; Vermont & C. R. Co. v. Vermont Cent. R. Co. 14 Amer. Ry. Rep. 497, 532, 546. Money expended in rolling stock and machinery has in some cases been allowed. Stanton v. Alabama & C. R. Co. 2 Woods, supra; Meyer v. Johnston, 53 Ala., supra. The circumstances under which this allowance was made do not appear in the findings. Nor do the circumstances under which many of those allowances were made appear. We must therefore presume that they were properly allowed. Error must appear; it cannot be presumed or conjectured. On the contrary, every intendment is in favor of the regularity and correctness of the ruling of the court below, it having jurisdiction of the subject-matter and parties. This court must start out in investigating error alleged with the above intendment as a postulate, and the record must by its contents displace such intendment.

These facts do appear in the bill of exceptions. It was admitted— "First. The Placerville & Sacramento Valley Railroad Company is a corporation organized in June, 1862, under the provisions of an act of the legislature of the state of California, entitled 'An act to provide for the incorporation of railroads, and the management of the affairs thereof, and other matters relating thereto,' approved April 20, 1861, and of the several acts sup

plementary thereto and amendatory thereof. This corporation is organized for the purpose of building, equipping, and operating a steam railroad between Placerville, El Dorado county, and Folsom, Sacramento county.

"Second. The Folsom & Placerville Railroad Company was a corporation organized under the laws of the state of California, in the month of September, 1876, for the purpose of operating a steam railroad over the route of the company named in the foregoing paragraph.

"Third. The Sacramento Valley Railroad Company was a railroad company organized under the laws of the state of California, at a date prior to the organization of either of the aforesaid companies, for the purpose of operating and maintaining a steam railroad between Sacramento and Folsom.

"Fourth. On the thirteenth day of April, 1877, the Folsom & Placerville Railroad Company and the Sacramento Valley Railroad Company were duly consolidated according to law, and upon such consolidation took the name of The Sacramento & Placerville Railroad Company,' which corporation is now in existence, and up to the time of the appointment of a receiver herein was engaged in operating as part of its route the line hereinafter mentioned; that is to say, the railroad from Sacramento to Folsom, from Folsom to Shingle Springs by the way of Latrobe; thus constituting one line from the city of Sacramento to Shingle Springs."

"Eighth. In the year 1869 the Placerville & Sacramento Valley Railroad Company became indebted to the firm or corporation known by the name of Wells, Fargo & Co. in the sum of $200,000, and made a mortgage of all its property to one Charles E. McLane, as trustee for Wells, Fargo & Co., to secure the payment of its promissory note for $200,000, and interest thereon at the rate of 10 per cent. per annum.

"Ninth. In the year 1871 said Wells, Fargo & Co., in the district court of the Eleventh judicial district, in and for the county of El Dorado, state of California, instituted proceedings for foreclosure of said mortgage against said railroad company making said mortgage, and therein duly, and after proper proceedings, obtained an order for the sale of all the corporate property of the said Placerville & Sacramento Valley Railroad Company; which said decree was thereafter duly executed by the sale of said corporate property of said railroad company to one William Alvord, and thereafter the commissioner appointed by the court to make said sale did, by his deed, bearing date July 21, 1871, convey to William Alvord the said Placerville & Sacramento Valley Railroad with its appurtenances. After Alvord had in this way acquired the title to the said railroad and its appurtenances, Leland Stanford, Mark Hopkins, and C. P. Huntington purchased of the said William Alvord all his right, title, and interest to the said railroad and its appurtenances, and received his proper deed therefor, for a good and valuable consideration, to-wit, the sum of $166,400 in gold coin of the United States, and thereupon and under said conveyance said Stanford, Hopkins and Huntington entered into possession of the said railroad of the said Placerville & Sacramento Valley Railroad Company, commencing at the town of Folsom, in Sacramento county, and extending to the town of Shingle Springs, in El Dorado county, by way of Latrobe, a distance of twenty-six and one-half miles. Since the time that Stanford, Hopkins, and Huntington entered into possession of the property last above mentioned, the Placerville & Sacramento Valley Railroad Company has transacted no business and had no property. Thereafter, and in or about the year 1877, the said Stanford, Hopkins, and Huntington duly sold and conveyed to the Sacramento & Placerville Company, (the same being the fruit of the consolidation of the Folsom & Placerville Railroad Company and the Sacramento Valley Railroad Company.) all and singular, the interest acquired by them aforesaid in the property purchased by them of William Alvord, as herein above stated. The Sacramento & Placerville Railroad Company has never, at any time, taken any corporate action of any description in relation to Exhibit A, and from

the time of the purchase of the said property from the said Stanford, Hopkins, and Huntington, and until the order of this court placed the same in the possession of Louis McLane as receiver and trustee pendente lite, the said property was in the possession of the said Sacramento & Placerville Railroad Company, was operated by it as part of its railroad between the city of Sacramento, Sacramento county, and Shingle Springs, in El Dorado county, under its corporate name and for its corporate benefit."

"Eleventh. The Placerville & Sacramento Valley Railroad Company never, at any time, had or owned any rolling stock or other equipments for its railroad."

It thus appears that the mortgagor company never had any rolling stock. The road laid with the iron purchased with the bonds of the mortgagor, some of which are involved in this action, was operated at the time this action was commenced by the defendant Sacramento & Placerville Company. The rolling stock used was owned by this corporation. This corporation, and the other corporations above mentioned, and the individuals Stanford, Hopkins, and Huntington claiming under it, were all purchasers of the road of the mortgagor, with full notice of the mortgage securing the bonds owned and held by Kittle. The mortgagor defendant having no rolling stock, and, as is apparent, the defendant Sacramento & Placerville Railroad Company having withdrawn its rolling stock from the road, the receiver and trustee could not operate the line without making some arrangements by which rolling stock could be procured. Nothing appearing to the contrary, we must presume that every effort had been made by the receiver to procure such stock before the purchase was made, and this purchase when it was made, was authorized by the court below. The receiver being authorized by the stipulations of the mortgage to take possession and operate the road, he certainly was entitled to use all necessary and proper means to enable him to do so. And we cannot, under these circumstances, conclude that the court below went astray in allowing the purchase of rolling stock. On this point wha' was said by the supreme court of Alabama in Meyer v. Johnston, 53 Ala. 348, per MANNING, J., is to the point:

"But these properties, [the court is speaking of railroad property,] with their appurtenances, vast in extent and value, yet very perishable if unused and neglected, existing as the estates of private individuals associated into corporations, but essentially public works, in whose operations the public at large and the state are concerned, when drawn into litigation, must be dealt with by the courts according to the nature and circumstances of the subject. And any one can understand that the best and cheapest mode of conserving a railroad may be by operating trains thereon, and keeping it in repair for their use. To preserve its value, it must generally be continued in operation and be sold as a going concern. If it were not for the public quality belonging to them, for the injury that would be done to the interests of whole communities that have become dependent on a railroad for accommodation in a thousand things, a chancellor might say to the parties most interested: Unless you furnish means for the protection of this property, which does not itself afford an adequate income for the purpose, it may become a dilapidated and useless wreck. . But the inconvenience and loss which this would inflict on the population of large districts, coupled with the benefit to parties who,

perhaps, are powerless to take care of themselves, of preventing the rapid diminution of value and derangement and disorganization that would otherwise result, seem to require-not for the completion of an unfinished work, or the improvement, beyond what is necessary, for the preservation of an existing one, but to keep it up, to conserve it as a railroad property, if the court has been obliged to take possession of it-that the court should borrow. money for that purpose, if it cannot otherwise do so in sufficiently large sums, by causing negotiable certificates of indebtedness to be issued constituting a first lien on the proceeds of the property, and redeemable when it is sold or disposed of by the court."

In Stanton v. Alabama & C. R. Co. 2 Woods, 506, in which a bill having been filed for the foreclosure and sale under a mortgage of the road and other property of the defendant railroad company, the court appointed receivers to take possession and control of the mortgaged property. Before the suit was begun trains had been running on the road from one terminus to another, but a portion of the road had been built in a hasty and temporary manner, and needed to be completed in a substantial and permanent way, in order to insure the safety of trains. The court made an order authorizing the receiver "to put said railroad and other property in repair, and to complete any incompleted portions thereof; to procure rolling stock, machinery, and other necessary things for operating the same, and to operate the same to the best advantage," and save and preserve the same for the benefit of the first-mortgage bondholders and others having liens thereon. By the same order the receivers were empowered to borrow or advance moneys not exceeding $1,200,000, which were to be a first lien upon the mortgaged property prior to all others, and to be paid before the first-mortgage bonds. They were also authorized to issue certificates for the money so raised for the purposes above mentioned, payable within a certain time, with interest payable semi-annually at a rate not exceeding 8 per cent. per annum. Other provisions were made as to the sale or disposition of the certificates, and directions were given as to their being countersigned by a majority of the trustees of the first mortgage bondholders. Under this order the receiver went into possession of the road, managed it, and issued and disposed of nearly all the certificates authorized by the foregoing order.

In Kennedy v. St. Paul & Pac. R. Co. 2 Dill. 448, where it was necessary to complete a road by a certain date to secure a land grant which was a material part of the security to the bondholders, DILLON, J., authorized a receiver to borrow money and complete the road within the time limited. In this case authority was given to the receiver to borrow not less than five millions of dollars. See, also, Jerome v. McCarter, 94 U. S. 734, where substantially the same thing. was done to complete a canal to secure a land grant.

We think the court did not err in the part of its decree above referred to. And as those expenses were incurred by the trustee and receiver under the direction of the court, in order to render the security effective under the mortgage to the bondholders, from whom no

objection comes, we discover no error in the decree giving a lien for those costs and expenses prior to the lien of the bondholders.

The question as to the authority of the court to order a sale of the mortgaged property is also discussed. And it is contended that such portion of the decree is manifestly erroneous. The objection in this case does not come from the mortgagor defendant, but from one holding by purchase under a decree of foreclosure and sale of the property mortgaged, by a security subsequent and subordinate to the trust mortgage under which plaintiff has proceeded. The defendant mortgagor does not appeal or object to the decree in any way. It is said that the action is not brought for a sale of the mortgaged premises; that the mortgage does not provide for a sale on default in paying the interest for one year, (the default on which this proceeding was instituted;) and that the principal of the bonds has not as yet become due.

As to the first objection the prayer of the complaint is broad enough to authorize a sale, if one should be necessary; and further, if in the progress of the action, events should occur which would authorize the court to order a sale, such order could be made on the application of any party whose interest calls for such action on the part of the court. What is said of the terms of the mortgage is correct. No sale is authorized on the default for interest, and the bonds have not yet matured. Still, is there not a necessity for a sale? The mortgagor is insolvent, the other defendant, purchaser of the road, will do nothing to discharge the interest, and it appears, if the road is operated at all by the trustee, must be run at a loss. The trustee has no funds to repair the road with, and the road, if unused, must and will decay. The operation of the road must be at a loss. Nothing will be realized to pay the interest as it matures, or the bonds when their principal falls due, as the security is becoming less every day. It would seem from this that the only resort to secure anything for the bondholders is by a sale. The trustee, having taken possession, is authorized to retain it until the interest and principal of the bonds have been paid. Wood v. Goodwin, 49 Me. 260. Under these circumstances, we think an urgent necessity has arisen for a sale-such a necessity as will authorize a court of equity to order it. This was done in Crane v. Ford, Hopk. Ch. 130. This was a suit to adjust the rights of parties to a steam-boat, and for an account. A person was appointed receiver of all moneys due or to become due from the earnings of the boat; and, under the direction of the receiver, the boat had been navigated for two years. A petition was thereupon presented to the court on behalf of the complainants, stating that the receiver's accounts had been settled by a master; that the boat was found to be in arrears to the receiver, and that she could not, under existing circumstances, be so employed as to be more profitable for the future than she had been for the past years; that large disbursements would be necessary to fit her out for another season, and pray