Opinion of the Court.

his grantor. Though the assumption of the mortgage debt by the subsequent purchaser is absolute and unqualified in the deed of conveyance, it will be controlled by a collateral contract made between him and his grantor, which is not embodied in the deed. And it will not in any case be available to the mortgagee, unless the grantor was himself personally liable for the payment of the mortgage debt.

"Recovery of the deficiency after sale of the mortgaged premises, against a subsequent purchaser, is adjudged in a court of equity to a mortgagee not in virtue of any original equity residing in him. He is allowed, by a mere rule of procedure, to go directly as a creditor against the person ultimately liable, in order to avoid circuity of action, and save the mortgagor, as the intermediate party, from being harassed for the payment of the debt, and then driven to seek relief over against the person who has indemnified him, and upon whom the liability will ultimately fall. The equity on which his relief depends is the right of the mortgagor against his vendee, to which he is permitted to succeed by substituting himself in the place of the mortgagor." 12 C. E. Green, 655, 656.

The decisions of this court, cited for the defendant, are not only quite consistent with this conclusion, but strongly tend to define the true position of a mortgagee, who has in no way acted on the faith of, or otherwise made himself a party to, the agreement of the mortgagor's grantee to pay the mortgage; holding, on the one hand, that such a mortgagee has no greater right than the mortgagor has against the grantee, and therefore cannot object to the striking out by a court of equity, or to the release by the mortgagor, of such an agreement when inserted in the deed by mistake; Elliott v. Sackett, 108 U. S. 132; Drury v. Hayden, 111 U. S. 223; and, on the other hand, that such an agreement does not, without the mortgagee's assent, put the grantee and the mortgagor in the relation of principal and surety towards the mortgagee, so that the latter, by giving time to the grantee, will discharge the mortgagor. Shepherd v. May, 115 U. S. 505, 511.

The present case is a strong one for the application of the general doctrine. The land has been sold under a prior mort

VOL. CXXXIII-40

Syllabus.

gage for a sum insufficient to pay that mortgage, leaving nothing to be applied towards the payment of the mortgage held by the plaintiff; and the plaintiff has exhausted her remedy against the mortgagor personally, by recovering judgment against him, execution upon which has been returned unsatisfied.

Although the mortgagor might properly have been made a party to this bill, yet as no objection was taken on that ground at the hearing, and the omission to make him a party cannot prejudice any interest of his, or any right of either party to this suit, it affords no ground for refusing relief. Mechanics' Bank v. Seton, 1 Pet. 299; Whiting v. Bank of United States, 13 Pet. 6; Miller v. Thompson, 34 Michigan, 10.

Decree reversed, and case remanded with directions to enter a decree for the plaintiff.

SHEPHERD v. PEPPER.

APPEAL FROM THE SUPREME COURT OF THE DISTRICT OF COLUMBIA.

No. 136. Argued November 26, 27, 1889. - Decided March 3, 1890.

Where appeals by five defendants from a final decree were allowed in open court in October, 1885, and the amount of the supersedeas bond as to one of them was fixed at $100, but he never gave it, and the others perfected their appeal, and the record was filed in this court in October, 1886, and, when the case came on for hearing in November, 1889, he asked leave to file a proper bond, it was granted nunc pro tunc as of the day of hearing.

S. gave two deeds of trust of a lot of land in the District of Columbia to secure loans made by P. Afterwards he gave a deed of trust of the same lot to secure a loan made by C., that deed covering also a lot in the rear of the first lot, and fronting on a side street. At the time all the deeds were given, there was a dwelling-house on the premises, the main part of which was on the first lot, but some of which was on the rear lot. P., on an allegation that B., a trustee in each of the first two deeds, had refused to sell the property covered by them, filed a bill asking the appointment of a trustee in place of those appointed by the first two deeds. The suit resulted in a decree appointing a new trustee in place of B.," in the deed of trust," but not identifying which one. The new trustee and the remaining old one then sold the land at auction to P.,

Statement of the Case.

under the first trust deed. S. then filed a bill to set aside the sale, and P. filed a cross bill to confirm it. The bill was dismissed. P. then filed this bill against S. and C., and all necessary parties, to have a trustee appointed to sell the land covered by the three trust deeds, and the improvements on it, to have a receiver of the rents appointed, and to have the rents and the proceeds of sale applied first to pay P. A receiver was appointed, and a decree made for the sale of the entire property, as a whole, by trustees whom the decree appointed, and for the ascertainment by the trustees of the relative values of the land covered by the first two trust deeds and the improvements thereon, and of the rear piece of land and the improvements thereon, and for the payment to P. of the net proceeds of sale representing the value of the land and improvements covered by the first two trust deeds, less the expenses chargeable thereto, and of the residue to C., and, out of the rents, to P., what he had paid for taxes and insurance premiums, and for a personal decree against S., in favor of P., for any deficiency in the proceeds of sale to pay the claims of P.; Held,

(1) It was the intention of both S. and P. that the first two deeds of trust should include the rear land as well as the front lot;

(2) The decree in the first suit by P. was so uncertain as to be practically void, and there was no effective appointment of a trustee and no effective sale to P.;

(3) P. was not estopped by that sale from having the property sold again;

(4) P. was not required, as a condition of the sale of the rear lot, to pay the whole of the debt due to C.; and the case was a proper one for selling the property as an entirety;

(5) It was, also, a proper one for the appointment of a receiver of the rents, and those rents in the hands of the receiver, after paying charges, ought to go to make up any deficiency in the proceeds of sale to satisfy the corpus of all the secured debts, and ought to be first applied to pay any balance due to P.;

(6) Under § 808 of the Revised Statutes relating to the District of Columbia a decree in personam for a deficiency is a necessary incident of a foreclosure suit in equity;

(7) As the notes secured by the deeds of trust bore interest at the rate of nine per cent per annum, until paid, it was proper to allow that rate of interest on the principal until paid, and not to limit the rate to six per cent after decree, because the contracts were not merged in the decree;

(8) The rate of interest on the decree for deficiency is properly six per cent, under §§ 713 and 829 of said Revised Statutes.

(9) The statute of limitation not having pleaded as to any part of the principal or interest, the defendant cannot avail himself of it.

IN EQUITY. Decree in favor of the complainant. The respondents appealed. The case is stated in the opinion.

Opinion of the Court.

Mr. William F. Mattingly and Mr. Enoch Totten, for appellants, Shepherd and others, and Mr. Henry Wise Garnett for Mrs. Gray, appellant, filed a joint brief, citing: Carpentier v. Brenham, 40 California, 221; Supervisors of Iowa County v. Mineral Point Railroad, 24 Wisconsin, 93; Howard v. Railway Co., 101 U. S. 837; Thompson v. Roberts, 24 How. 233; Rapalee v. Stewart, 27 N. Y. 310; Duff v. Wyncoop, 74 Penn. St. 300; Swanson v. Tarkington, 7 Heiskell, 612; Tuite v. Stevens, 98 Mass. 305; Grymes v. Sanders, 93 U. S. 55; Rogers v. Higgins, 57 Illinois, 244; Stockton v. Ford, 18 How. 418; McLaughlin v. Barnum, 31 Maryland, 425; Eastman v. Amoskeag Mfg. Co., 47 N. H. 71; Neilson v. Lagow, 12 How. 98; Dudley v. Price, 10 B. Mon. 84; Christmas v. Mitchell, 3 Iredell Eq. 535; Miller v. McIntyre, 6 Pet. 61; Miller v. Bealer, 100 Penn. St. 583; Wagar v. Stone, 36 Michigan, 364; Gilman v. Illinois & Mississippi Telegraph Co., 91 U. S. 617; Railroad Cos. v. Schutte, 103 U. S. 118; Kountze v. Omaha Hotel Co., 107 U. S. 378 Teal v. Walker, 111 U. S. 242.

Mr. Nathaniel Wilson and Mr. Walter D. Davidge, for appellee, cited: Strong v. Grant, 2 Mackey, 218; Mobile County v. Kimball, 102 U. S. 691; Gould v. Evansville &c. Railroad, 91 U. S. 526; Gardner v. Sharp, 4 Wash. C. C. 609; Walden v. Bodley, 14 Pet. 156; Hughes v. United States, 4 Wall. 232; Russell v. Place, 94 U. S. 606; Cromwell v. Sac County, 94 U. S. 351; Graham v. Railroad Co., 3 Wall. 704; Davis v. Brown, 94 U. S. 423; Dodge v. Freedman's Savings & Trust Co., 106 U. S. 445; Grant v. Phoenix Life Ins Co., 121 U. S. 105; Keyser v. Hitz, 4 Mackey, 179; Holden v. Trust Co., 100 U. S. 72; Philadelphia, Wilmington & Baltimore Railroad v. Howard, 13 How. 307.

MR. JUSTICE BLATCHFORD delivered the opinion of the court.

On the 1st of June, 1874, Alexander R. Shepherd and his wife made a deed of trust to Andrew C. Bradley and William II. Philip, conveying to them real estate situated in the city

Opinion of the Court.

of Washington, in the District of Columbia, described in the deed as follows: "Part of lot numbered two (2) in square numbered one hundred and sixty-four (164), and bounded and described as follows, viz.: Beginning at a point on North K Street forty-three feet and nine inches (43 ft.) east of the southwestern corner of said square, and running thence west on K Street forty-three feet and nine inches (4312 ft.), to said southwestern corner of said square; thence northwesterly along the line of Connecticut Avenue about eighty feet and ten inches (8012 ft.), to the south line of original lot numbered three (3) in said square; thence northeasterly and at right angles with said avenue and along the line of said lot three (3), about eighty-five (85) feet, to intersect a line drawn due north from the point of beginning, and thence due south to the point of beginning." The deed recited that Shepherd was indebted to George S. Pepper in the sum of $35,000, evidenced by a promissory note executed to Pepper, dated June 1, 1874, and payable in five years after date, with interest, payable semiannually, at the rate of nine per cent per annum, until paid, accompanied by 10 coupon notes for $1575 each, representing the interest; and it conveyed the land in trust to secure the payment of the notes. It gave power to the trustees to sell the premises at public auction, on a default in the payment of the notes or any instalment of interest, and to convey the property in fee simple to the purchaser. Shepherd covenanted in the deed to keep the buildings on the land insured during the continuance of the trust in the sum of $25,000, and to have the policies assigned to the trustees; and that, on his failure to do so, Pepper might do it and the premium he should pay should be considered as secured by the trust deed.

On the 22d of March, 1875, Shepherd and his wife executed to William F. Mattingly and the said Andrew C. Bradley another deed of trust, covering the same premises by the same description as in the first deed, to secure the payment to the said Pepper of a promissory note dated March 22, 1875, for $10,000, payable five years after date, with interest, payable semi-annually, at the rate of nine per cent per annum, until paid, accompanied by 10 coupon notes of $450 each, represent