THE LIBRARY OF THE UNIVERSITY OF CALIFORNIA LOS ANGELES SCHOOL OF LAW Of elementary treatises on all the principal subjects of the law. The special features of these books are as follows : 1. A succinct statement of leading principles in black- letter type. 2. A more extended commentary, elucidating the princi- ples. 3. Notes and authorities. Published in regular octavo form, and sold at the uniform price of $3.75 per volume, including delivery. Bound in American Law Buckram. 1. Norton on Bills and Notes. (3d Ed.) 2. Clark on Criminal Law. (2d Ed.) 3. Shipman on Common-Law Pleading. (2d Ed.) 4. Clark on Contracts. (2d Ed.) 5. Black on Constitutional Law. (2d Ed.) 6. Fetter on Equity. 7. Clark on Criminal Procedure. 8. Tiffany on Sales. (2d Ed.) 9. Glenn on International Law. 10. Jaggard on Torts. (2 vols.) 11. Black on Interpretation of Laws. 11'. 1 1 ale on Bailments and Carriers. 13. Smith on Elementary Law. 14. Hale on Damages. l.~>. Hopkins on Real Property. Hi. Hale on Torts. 17. Tiffany on Persons and Domestic Relations. (2d Ed.) 18. Croswell on Executors and Administrators, in. Clark on Corporations. (2d Ed.) 20. George on Partnership. 21. Shipman on Equity Pleading. 2-2. M'-Kclvey on Evidence. (2d Ed.) J ::. Harrows on Negligence. 24. Hughes on Admiralty. KM ton on Equity. 20. Tiffany on Principal and Agent 27. Gardner on Wills. 28. Vance on Insurance. 20. Ingersoll on Public Corporations. 30. Hughes on Federal Jurisdiction and Procedure. 31. O'hilds on Suretyship and Guaranty. 32. Costlgan on American Mining Law. In preparation : Handbooks of the law on other subjects to be announced later. Published and for sale by WEST PUBLISHING CO., ST. PAUL, MINN. C58lK>d HANDBOOK or EQUITY JURISPRUDENCE By JAMES W. EATON of the Albany Bar Professor of Law In the Albany Law School, and Lecturer in the Boston University School of Law ST. PAUL, MINN. WEST PUBLISHING CO. igox COPTRIQHT, 1901, BT WEST PUBLISHING CO. T PUBLISHERS' PREFACE. By the untimely death of James W. Eaton, the author of this book, soon after the completion of the manuscript, and while it was yet in the hands of the printers, the making of such statement as may be helpful to the reader in regard to its purposes, scope, and preparation, which would have come more fitly and satisfactorily from him who had devoted to the work much of the last year of his life, devolves on the publishers. The general purpose of the author and the publishers has been to make a systematic, complete, and reliable presenta- tion of Equity Jurisprudence, as full as is practicable within the limits of an ordinary volume, in the form and having the special features of the Hornbook Series, and, like others of the series, adapted to the needs both of the student and the practitioner. The Hornbook method, combining text, commentary, and annotation, seems peculiarly suitable for the treatment of this subject, in which general principles and maxims are so prominent and controlling, and their meaning and application are so fully 'illustrated by decided cases. The chief difficulty, indeed, arises from the great extent and variety of the subjects involved in the application of equi- table doctrines. But while exhaustive treatment of spe- cific subjects of equity jurisdiction is beyond the scope of this work, it is quite practicable to exhibit the application to each such subject of the various principles applicable, as fully as is useful in a general treatise. To the execution of this project, the author brought quali- fications not often found in combination : Thorough knowl- edge of the subject, derived from study, stimulated by genu- ine interest in this department of the law; experience as a practicing lawyer, who had put to actual test the relative weight of conflicting principles, arguments, and precedents, and who knew what the practitioner would expect in such a work; experience as an instructor and lecturer on the law, (V) vi PUBLISHERS' PKEFACE. who understood the requirements of both teacher and stu- dent; and command of a clear style and faculty of precise expression, well calculated to render the work attractive in form as well as reliable in substance. It is believed that the result fully realizes what was intended and expected. In particular, the author has endeavored to state and ex- plain accurately, clearly, and concisely the principles of the subject, as now established; to describe the origin and de- velopment of equity as a system and of its particular doc- trines, so far as may aid in understanding their scope and application; to indicate the qualifications and limitations of each principle or rule, whether inherent, or imposed by the relation of equity to the common or the statutory law, or arising only in its application to a specific subject; to show the scope and operation of the various equitable remedies ; and to illustrate the whole by ample statements and cita- tions of judicial decisions, especially the more recent cases. That the rules of equity are to be sought in the modern rather than the ancient cases, by reason of the progressive nature of equity jurisprudence, has long been recognized. Besides this, new applications of equitable doctrines and new uses of equitable remedies continually arise. On the other hand, the adoption and application by law courts of equitable doctrines, legislative enactments recognizing and enforcing equitable rights and principles, and changes in forms of procedure, have removed the occasion for resort to the equity courts in large classes of cases, and thus made practically useless the discussion of many equitable doc- trines. In this work, the treatment of the various subjects is intended to correspond to the existing conditions of equity jurisprudence, as developed or diminished, for prac- tical purposes ; and in this respect, especially, it is believed the book will prove more useful than its predecessors, as treating the subjects of present interest more fully as well as in their latest developments. The author had expressed, in the strongest terms, his sense of obligation to Frank B. Gilbert, of the New York Bar, for the greatest possible assistance in preparing the manuscript, without which he believed he would have been unable to complete the work, by reason of the exactions of other professional engagements; and he had intended to make, in the preface or otherwise, full acknowledgment PUBLISHERS' PREFACE. vii thereof. Upon Mr. Gilbert has devolved, also, the responsi- bility and labor of reading and correcting the proof, com- piling the index, and other matters incident to the produc- tion of the book. The publishers gladly add, to the author's tribute of thanks and appreciation, their own acknowledg- ment of the important services rendered by Mr. Gilbert, before and since the decease of the author. In the preparation of the work, free use of the material contained in Fetter on Equity, an excellent, though much briefer, work of the same nature, was authorized by the pub- lishers, owners of the copyright. Whenever other standard authors have been quoted or otherwise used as authorities, as the great work of Pomeroy on Equity Jurisprudence, or other writers on special topics, due credit is given in the notes. In the main, the work is derived from the decisions, with special attention to those included in well-known col- lections of illustrative cases, principally White and Tudor's Leading Cases in Equity and Keener's Cases on Equity Jurisprudence. WEST PUBLISHING CO. St Paul, Minn., Sept 16, 1901, TABLE OF CONTENTS. CHAPTER I. ORIGIN AND HISTORY. Section Pag 1. Distinction Between Equity and Law History. . 1-10 2. Causes of the Existence of the Equity Jurisdic- tion 11-18 8. Separate Equitable Tribunals Abolished 18-19 4. Equity Jurisdiction in the United States 19-25 CHAPTER H. GENERAL PRINCIPLES GOVERNING THE EXERCISE OF EQUITY JURISDICTION. 5. Equity and the Common Law 26-28 6. Equity Jurisdiction Defined 28-29 7. Exercise of Equity Jurisdiction 30-31 8. Adequate Remedy at Law 31-35 9. Multiplicity of Suits 35-39 10. Retention of Jurisdiction to Award Complete Re- lief 39-40 11. Effect of Acquisition by Courts of Law of a Juris- diction Similar to that of Equity 41-42 12. Auxiliary Jurisdiction of Equity 42-43 CHAPTER in. MAXIMS. 13. No Wrong without a Remedy 44-47 14. Equity Follows the Law 47-52 15. Equity Aids the Vigilant 52-57 16. Equality Is Equity 58-61 17. Equal Equities, the Law Must Prevail 61-62 18. Equal Equities, First In Order of Time Must Pre- vail 62-64 19. He Who Seeks Equity Must Do Equity 65-69 20. He Who Comes into Equity Must Come with Clean Hands 69-77 EATON, EQ. (ix) TABLE OF CONTENTS. Section 21. Equity Looks on That as Done Which Ought to be Done ........................................ 77-81 22, Equity Looks to the Intent Bather than to the Form ........................................ 81-86 28. Equity Imputes an Intent to Fulfill an Obligation. . 8C-87 24. Equity Acts In Personam ........................ 88-94 25. Equity Acts Specifically, and not by Way of Com- pensation .................................... W CHAPTER IV. PENALTIES AND FORFEITURES. 26-27. Doctrine Relative to Penalties and Forfeitures... 95-96 28-29. Definitions , 97-99 80. Grounds for Relief 99-101 31. Liquidated Damages 101-102 82. Rules Governing the Determination as to Liqui- dated Damages or Penalty 102-110 83. Enforcing Forfeitures 110 84. When Equity Will Relieve Against Forfeitures. ..111-112 85. Statutory Penalties and Forfeitures 112 CHAPTER V. PRIORITIES AND NOTICE. 86. Origin and Application of Doctrine of Priority... .113-114 87. Doctrine Does Not Apply to Legal Estates 114-115 88. Equal Equities 115-116 89. Where One of the Parties Has the Legal Es- tate 116-117 40. Superior Equities 118 41. Superiority of Estate Created by Trust or Con- tract 118-119 42. Equity In Specific Thing 119-120 43. Equity of Party Misled 120-122 44. Notice of an Equity 122-123 45-46. Notice Definition 123-125 47-49. Kinds of Notice l 125-126 60. Actual Notice 127-135 61. Constructive Notice 136-137 62. Possession as Constructive Notice 137-143 Constructive Notice by Registration 144-148 64. Recitals In Title Papers 148-150 65. Lli Pendena ..151-155 TABLE OF (mTENTS. XI CHAPTER VI. BONA FIDE PURCHASERS WITHOUT NOTICE. Section Page 50. Doctrine of Bona Fide Purchase 166 67. Application of Doctrine 157-158 68. What Constitutes a Bona Fide Purchase 158-164 CHAPTER VII. EQUITABLE ESTOPPEL. 59. Definition 165-168 60. Fraud as a Basis of Equitable Estoppel 168-169 61. Essential Elements 169-176 62. Operation of Estoppel 176-177 63. In Whose Favor Estoppel Does Not Operate 177-179 CHAPTER VIH. ELECTION. 64-65. Definition Doctrine of Election 180-182 66. Election under or against the Instrument 182-184 67. Application of Doctrine 184-185 68. Conditions Necessitating Election 185-190 69. Doctrine when Not Applicable to Two Distinct Gifts 190 70. Election between Dower and Testamentary Gift. .190-194 71. Manner of Making an Election 195-196 72. Ascertainment of Values 196-197 73. Ejection by Persons under Disabilities 197-198 74. Time when Election must be Made 199 75. Effect of Election .-.199-200 CHAPTER IX. SATISFACTION AND PERFORMANCE. 76. Satisfaction Definition 201-202 77-78. Admissibility of Parol or Extrinsic Evidence. 202-203 79. Application of Doctrine 2O3-204 80. Satisfaction of Debts by Legacies 204-205 81. When Presumption of Satisfaction Will Not Operate 205-207 82. Declared Intention of Satisfaction of Debt. .. 207 zii TABLE OF CONTESTS. Section Page 83. Debt Owing to Wife or Child 208 84. legacy by a Creditor to His Debtor 208-209 85-88. Satisfaction of Legacies by Subsequent Legacies. .209-211 89. Satisfaction of Legacies by Portions or Advance- ments 211-214 90. Person in Loco Parentis 214-215 91. Presumption in Favor of Ademption 215-217 92. When Satisfaction must h* Expressed 217-219 93. Satisfaction of Portions by Legacies 219-220 94. Performance Doctrine Stated 220-221 85. Application of Doctrine 221-222 CHAPTEB X. CONVERSION AND RECONVERSION. 96. Equitable Conversion Defined 223-224 97. Application of Doctrine 224-226 98. Words Sufficient to Effect Conversion 226-228 99. Time when Conversion Takes Place 228-231 100. Effect of Conversion 232-235 10L Conversion by Paramount Authority 235-238 102-103. Total or Partial Failure of Purposes for Which Conversion is Directed 238-243 104. Double Conversion 243-244 106-106, Reconversion 244-246 CHAPTER XL GROUNDS OF EQUITABLE RELIEF ACCIDENT. 107. Accident Denned , 247-248 108. Right to Relief because of Accident 248-250 109. Cases in Which Relief will be Afforded 250-254 CHAPTER xn. GROUNDS OF EQUITABLE RELIEF MISTAKE. 110. Definition 255-257 111. Classification 257 112. Mistake of Law 258-286 113. Mistake of Fact ;. .266-267 114. Classification 267 116. When Mutual or Fundamental 267-271 116. Of One of the Parties as to Subject-Matter. .271-275 117. Mistake of Expression 275-281 118. Restoration of Parties 282 TABLE OF CONTENTS. Xlll CHAPTER XIII. GROUNDS OF EQUITABLE RELIEF FRAUD. Section Page 119. Equitable Jurisdiction in Cases of Fraud 283-280 120. What Constitutes Fraud 286-287 121-124. Classification of Fraud 287-288 125. Actual Fraud 288 126. Misrepresentation 288-299 127. Fraudulent Concealment 300-304 128. Remedies of Defrauded Party 304-306 129. Constructive Fraud 306-307 129%. Apparent from Nature of Bargain 307-314 130. Inferred from Condition of Parties 314-315 131-132. Transactions with Persons Totally or Par- tially Incapacitated 315-318 133. Transactions with Persons under Duress or Undue Influence 319-320 134. Transactions between Persons in Fiduciary Relationship 321-329 135. Gifts between Persons in Fiduciary Relation- ship 330-332 136. Ratification, Confirmation, or Acquiescence. ..333-334 137-139. Fraud upon Third Persons not Parties to the Contract 335 140. Frauds upon Creditors 335 141. Compositions with Creditors 336 142-143. Fraudulent Conveyances 337 144-145. Creditor to be Defrauded 337-339 146. Intent to Defraud 339-341 147. Transfer of Property 341-343 148. Fraud on Marital Rights 343-344 149. Fraud on Powers.. ...344-345 CHAPTER XIV. EQUITABLE PROPERTY TRUSTS GENERALLY EXPRESS TRUSTS. 150. Definition of a Trust 346-347 151-153. Historical Statement 347-353 154. Classification of Trusts 353-354 155. Express Private Trusts 354 156. Express Trusts Parties 354 157. Who may be a Settlor 354-355 158. Who may be a Trustee 356-358 159. Who may be a Cestui Que Trust 358-359 IttO. Property Subject to Trust 3HO-361 161-162. Creation 3U1-3W XIV TABLE OF CONTENTS. Section Page 103. Language Creating Trust 365-367 164-168. Precatory Words 368-360 167-169. Enforcement of Voluntary Trusts 370-375 170-171; Objects of Trusts 375-378 172-174. Executed and Executory Trusts 378-381 175. Active and Passive Trusts 381 176-177. Active Trust 381-383 178-179. Passive Trust 383-384 180. Assignment for Benefit of Creditors 384-385 181. Public or Charitable Trusts Objects 385-388 182. Characteristics 389-392 183. Cy-Pres Doctrine 393-394 184. Charitable Trusts In the United States 394-396 CHAPTER XV. IMPLIED TRUSTS RESULTING AND CONSTRUCTIVE. 185. Implied Trusts Definition 397-398 186. Resulting Trusts 398 187. Classification 398-400 188. Where Owner of Legal and Equitable Estate Conveys Legal Title Only 400-402 189. Arising from Failure of Express Trusts 402-404 190. Conveyance without Consideration 404-405 191. Where Purchase is in Name of Another 405 192. Purchase In Name of Stranger 405-409 193. Purchase In Name of Wife, Child, or Rela- tive 409-411 194. Constructive Trusts 411-412 195. Purchases with Trust Funds 413-415 198. Conveyance of Trust Property to Volunteer or Purchaser with Notice 415-416 197. Bequests and Devises Obtained through Fraud 417-418 CHAPTER XVI. POWERS, DUTIES, AND LIABILITIES OF TRUSTEES. 198-190. Acceptance of Trust 419-420 200. Paramount Duty of Trustee 420-421 201. Duty to Acquire Outstanding Trust Property 421-422 202. Duty to Exercise Reasonable Care 422-423 203. Delegation of Powers 423-425 204. Duty to Invest 428-428 205. Other Duties Respecting Management of Trust Property 428-430 TABLE OF CONTENTS. XV Section Page 206. Liability for Acts of Co-Trustee , 431-433 207. Compensation and Expenses of Trustee 433-435 208-209. Accounts of Trustees. 435-436 210. Following Trust Property 436-439 211-212. Breach of Trust 439-442 213. Removal of Trustee 442-444 CHAPTER XVII. MORTGAGES. 214. The Common-Law Doctrine as to Real-Estate Mortgages 445 446 215. Equitable Theory of a Mortgage 446-452 216-217. Definition of Mortgage 452 218. Objects of Mortgage 453 219. Real-Estate Mortgage Absolute Deed as Mort- gage 453-455 220. Conditional Sale as Mortgage 456-457 221-223. Mortgage to Secure Future Advances. ...... .457-459 224. Assignment of Mortgage 459-460 225. Conveyance of Mortgaged Premises 460-463 226. Foreclosure of Mortgage 463-466 227-228. Rights and Liabilities of Mortgagor and Mort- gagee 466-468 229. Redemption 468-472 230-231. Mortgages and Pledges of Personal Property 472-473 CHAPTER XVITI. EQUITABLE LIENS. 232. Definition and Nature 474-475 233. Equitable Mortgages, How Created 475-479 234-235. Equitable Liens Arising from Considerations of Justice 479-481 236. Equitable Liens Arising from Charges by Will or Deed 481-484 237. Vendor's Lien , 484-485 238. Under Contracts of Sale 485-486 239. Arising after Conveyance of Land 486-490 XVI TABLE OF CONTENTS. CHAPTER XIX. ASSIGNMENTS. Section 24O. Assignments at Common Law 491-493 241-242. Asslguability of Choses in Action 493-496 243-244. Equitable Assignments Possibilities and Expect- ancies After-Acquired Property 496-500 245. Order upon a Fund 500-502 240-247. Notice to Debtor 503-504 248. Assignment Subject to Equities 505-506 CHAPTER XX. REMEDIES SEEKING PECUNIARY RELIEF. 249. Contribution 507-509 250. Exoneration 510-511 251. Subrogation 511-513 252. Marshaling 513-516 253. Accounting 516-517 254. When Equity will Assume Jurisdiction 517-520 2T>5. Defense of Stated Account 520-521 256. Application of Payments 521-524 CHAPTER XXI. SPECIFIC PERFORMANCE. 267-258. Definition Equity Jurisdiction 625-526 2f>9. Inadequacy or Impracticability of Damages 526-529 2<>0. The Exercise of Jurisdiction Is Discretionary 529-530 261. Contracts for Performance of Personal Acts 531-533 2(52. Specific Performance Is Against the Person 533-534 263. Defenses In Actions for Specific Performance In- capacity of Parties 534-535 264. Nonconcluslon of the Contract 535 2) The inelasticity of the common-law system of procedure, and (c) The ineffectiveness or Inadequacy of the rem- edies provided by the common law. Inflexibility of the Common Law. It is frequently asserted that the principles of common law are founded on reason and equity. Doubtless this is, in a sense, true. So long as the common law was in the course of formation, it was not only susceptible of application to cases within the spirit of existing law, but not expressly provided for, but also of being applied in accordance with the princi- ples of equity as subsequently known. But precedents es- tablished by the decisions of the judges soon came to be considered as of binding authority on succeeding judges. Hence, early in its history the English common law became essentially a lex scripta, positive and inflexible ; and, although new principles have ever continued to be made, the rules of practice have not accommodated themselves to the exigen- cies of new circumstances and new cases. 1 Had it not been for the blind conservatism of the courts of king's bench, common pleas, and exchequer in their regard for the "rules and doctrines once formulated by precedents, and their inability and unwillingness to furnish remedies for such wrongs as, by their nature, would permit of redress, the reserve jurisdiction of the king's council would probably not 2. i Spence, Eq. Jur. p. 321. The creation of equity arose out of the inability of courts of law, through the inflexibility of their rules and want of power, to adapt Judgments to the special cir- cumstances of cases to reach and to complete Justice In all cases. Thomas v. Musical Mut. Protective Union, 121 N. Y. 45, 24 N. B. 24. 12 ORIGIN AND HISTORY. (Ch. 1 have been called into play, and the distinct equitable jurisdic- tion of a court of chancery would never have been created. Mr. Green, in his History of England,* says : "The equita- ble jurisdiction of the chancellor sprang from the defective nature and technical and unbending rules of the common law. As the council had given redress in cases where law became injustice, so the court of chancery interfered, with- out regard to the rules of procedure adopted by the common- law courts, on the petition of a party for whose grievance the common law provided no adequate remedy. An analogous extension of his powers enabled the chancellor to afford re- lief in cases of fraud, accident, or abuse of trust ; and this side of the jurisdiction was largely extended at a later time by the results of legislation on the tenure of land by ecclesias- tical bodies." It may be correctly assumed that the ultimate source of equitable jurisdiction was in the king's prerogative to ad- minister justice independently of the courts. We have seen how the common law and equitable jurisdiction of the chan- cellor arose from the custom of the king and his council to refer matters pertaining to the administration of justice to that officer. But it is also true that the exercise of the king's prerogative would not have been often required had the com- mon-law courts been able or willing to provide a remedy for every wrong. Many injuries existed which the common-law courts could not relieve. The suitor was, therefore, in such cases, compelled to throw himself upon the grace and com- passion of the king and council ; and later, when the equita- ble jurisdiction of the court of chancery became firmly es- tablished, he was required to seek relief in that court. The equitable jurisdiction of the chancellor grew up in the same manner, and under the same circumstances, as the equi- table jurisdiction of the praetor at Rome. Each of them arose from necessity in the actual administration of justice and from the deficiencies of the positive law (the lex scripta), or from the inadequacy of the remedies, in the prescribed forms, to meet the full exigency of each particular case. It was not a usurpation for the purpose of acquiring and exer- cising power, but a beneficial interposition to correct gross Green, Hist Eng. book 8, c. 4. 2) CAUSES OF EXISTENCE OF EQUITY JURISDICTION. 13 injustice, and to redress aggravated and intolerable griev- ances. 2 The inability or failure of the common-law judges to adopt and apply the equitable principles contained in the Roman law added materially to the inflexibility of the common law, and aided in the growth of the equitable jurisdiction of the court of chancery. The Roman law was a growth in keep- ing with the needs of society, and contained a notion of equi- ty sufficient, if applied to the administration of justice by common-law courts, to have made the development of the equitable jurisdiction of the court of chancery exceedingly difficult. This would have been especially so had the com- mon-law judges availed themselves of the example set by the Roman prastors, and invented new actions and defenses to meet the exigencies of an advancing civilization. But in the early stages of the development of English equity, Roman law was not easily applied to the tenure of real property, and the status of persons, which were feudal in their origin and nature. There was nothing in common between the institu- tions of feudalism as they existed under the Norman kings and the doctrines of the Roman law. As long as these insti- tutions continued, none of the doctrines of the Roman law could be effectively or advantageously applied to them. Moreover, the possible growth of the Roman law early re- ceived a lasting check. In the reign of Edward III. the ex- actions of the court of Rome had become odious to the king and the people. The king, having the support of his parlia- ment, refused payment of the tribute which had been de- manded by the pope, and measures were taken to prevent further encroachments of the papal power." A general dis- like on the part of the laity to anything connected with the Holy See began to spring up. The very name of Roman law became the object of aversion. In the reign of Richard II. the barons formally protested that they would not allow the kingdom to be governed by the Roman law, and the com- mon-law judges prohibited it from being any longer cited in their courts. The immediate effect of this was not to banish the Roman law, but to transfer it to another tribunal, which Story, Eq. Jur. (13th Ed.) | 50. Speuce, Eq. Jur. p. 346. 14 ORIGIN AND HISTORY. (Ch. 1 was not governed by common-law doctiines. The jurisdic- tion of the court of chancery was greatly extended, and at once embraced the subject-matters of litigation which re- quired the application of the principles and doctrines of the Roman law. Inelasticity of System of Procedure. The causes stated above as resulting in the extension of equity and the prevention of the expansion of the common law would not have been so effectual had it not been for the cramped and inflexible system of procedure early established in the courts of law. According to the common law, every species of civil wrong was supposed to fall within some par- ticular class, and for each class an appropriate remedy ex- isted by the use of a fixed number of "forms of action." If the facts and circumstances of a particular case could not be embraced in any of these forms, no remedy could be had, and the only mode of redress was by an application made directly to the king. The first step in every action was by a writ or breve issued in the name of the king. Each writ was found- ed on some principle of law authorizing the right of action, and stated sufficient facts to bring the case within such prin- ciple. 4 Thus, if a suitor had suffered an injury, it was not competent for him to bring to the notice of the court the facts of the case, and leave it to the court to say whether, upon such facts, the case was one deserving of redress ; but he had first to determine within what class of wrong his case fell, and then apply for the proper writ. If the facts were such as to bring the alleged wrong within some of the classes recognized at common law, there was the risk of selecting an improper writ, which resulted in the suitor failing in his ac- tion. 8 Spence, Eq. Jur. p. 226. This, indeed, was a fertile source of Injustice In common-law proceedings, even within the last few years; in fact until the com- mon-law procedure act of 1852 (15 & 16 Viet. c. 76, 3), which enact- ed "that it shall not be necessary to mention any form or cause of action in any writ of summons." Thus, before the late procedure act, it often happened that a man sued in "debt" when he ought to have sued in "assumpslt," or "trespass" when he ought to have selected "case." He incurred, perhaps, great expense; and, al- though proving at the trial facts showing him to be entitled to a 2) CAUSES OF EXISTENCE OP EQUITY JURISDICTION. 15 All these writs were issued in early times by the clerks in chancery. Their nature was fixed, and could not be substan- tially changed. If a precedent could not be found among those formerly granted on facts similar to those of the case brought by the suitor, he had no action. It often happened, therefore, that there was an absolute denial of justice to the complainant. This evil was apparently felt at an early time, for in 13 Edw. I. a statute was passed attempting a remedy by extending the discretion of the clerks in chancery in fram- ing the writ. This statute * provided that "whensoever from henceforth it shall fortune in the chancery, that in one case a remedy is found, and in like case falling under like law, and requiring like remedy, none is found, the clerks of the chan- cery shall agree in making the writ, or the plaintiff may ad- journ it until the next parliament ; and the cases in which the clerks cannot agree are to be written and referred by them unto the next parliament, and by agreement of men learned in the law a writ is to be made, lest it should hap- pen that the court should long time fail to minister justice unto complainant." This statute did not furnish adequate relief. The clear intent was to permit the common-law courts to administer justice in cases not within the prece- dents already established. But the common-law judges re- fused to consider themselves bound by the decisions of the clerks in chancery in issuing writs under such statute, and exercised the right, which they had always assumed, of deter- mining the validity of all writs. Knowing the antipathy to Roman law, it can be readily seen that new writs issued to meet newly-occurring emergencies involving, as they un- doubtedly did, the principles of Roman law, must have arous- ed the jealousy of the common-law judges, and made them reluctant to avail themselves of the privileges conferred by the statute. When not disregarding entirely the new writs issued by the chancery clerks, the judges construed the stat- ute so strictly that its ultimate object of enlarging the scope of the common law and retarding the growth of the equita- ble jurisdiction of the court of chancery was completely frus- common-law remedy, yet failed because he had selected the wrong form of action. Haynes, Eq. p. 9. 13 Edw. I. st L c. 24. 16 ORIGIN AND HISTORY. (Ch. 1 trated. The courts imposed a highly restrictive meaning upon the words, "falling under like law, and requiring like remedies," and insisted that all new writs should be like one of those in use in the common-law forms of action ; so that, unless the relief sought fell within prescribed forms, there was no remedy, and litigants requiring special equitable re- lief were still compelled to seek another tribunal. The stat- ,ute only provided for new writs on behalf of plaintiffs. But with advancing civilization new defenses also arose, for which no provision had been made, and which, therefore, fell be- yond the province of the common law. In such cases the jurisdiction of the chancellor was appealed to, which was generally exercised by enjoining the prosecution of the legal action in which the equitable defense interposed had been rejected. While this statute was ineffectual to prevent the growth of the equity jurisdiction, it resulted in the creation of at least three new forms of legal actions, "trespass on the case," and its offshoots, "trover" and "assumpsit," which in later times were potent aids in the reformation and reconstruc- tion of the common law. These actions have been free from formal restraints, flexible in their adaptability, and capable of being administered in conformity with equitable doctrines. Through their means, many of the rules which were origi- nally established by the chancellor have been incorporated into the law, and are now mere legal commonplaces.* Inadequacy of Common-Law Remedies. Another, and perhaps the most direct and proximate, cause of the growth and development of the system of equity is the insufficiency or inadequacy of common-law remedies. It has been said that the growth of equity has its root in the system of remedies adopted. While it is the office of chan- cery to mitigate the rigor of the common law, to supply its deficiencies, to relieve against its technical rules, and to de- cide controversies according to equity and good conscience, it is because of its system of remedies that it is enabled to do this. 1 To understand this, it is only necessary to consider 1 Pom. Eq. Jur. 5 29. f 1 Keener, Cas. Eq. Jur. p. 10 (Langd. Eq. PL). 2) CAUSES OF EXISTENCE OF EQUITY JURISDICTION. 17 the distinction between the judgments of courts of law and the decrees of courts of chancery. In an action at law a general and unqualified judgment only can be given for the plaintiff or for the defendant, without any adaptation of it to particular circumstances. But courts of equity can adapt their decrees to- all the varieties of circumstances which may arise, and adjust them to all the peculiar rights of all the par- ties in interest. They may administer remedies for rights which are not recognized by courts of common law. Thus, what are technically called "trusts" are wholly without any cognizance at the common law, and the abuses of such trusts are beyond the reach of legal process. But they are cog- nizable in courts of equity, and an ample remedy is there given in favor of the cestuis que trustent for all wrongs and injuries, whether arising from negligence or positive miscon- duct. There are also many cases of losses and injuries by mistake, accident, and fraud, of penalties and forfeitures, of impending irreparable injuries or meditated mischiefs, and of oppressive proceedings, undue advantages and impositions, betrayals of confidences, and unconscionable bargains, in all of which courts of equity will interfere, and grant redress, but of which the common law takes no notice, or silently dis- regards. Courts of equity may compel a party to specific- ally perform a broken contract ; courts of common law can only award damages for the breach. Courts of equity can prevent wrongs by injunction, but courts of common law can only grant redress when the wrong is done. 8 This power of Story, Eq. Jur. 28-30. It was probably in the reign of Rich- *rd II. that the chancellor began to establish systematically hia peculiar restraining jurisdiction. This originated in the practice of feoffments to uses, by which the feoffor, who had legal seisin of the landj stood bound by private engagement to suffer another, called the cestui que use, to enjoy its use and possession. Such fiduciary estates were well known to the Roman Jurists, but incon- sistent with the feudal genius of the English law. The courts of. Justice gave no redress, if the feoffor to uses violated his trust by detaining the land. To remedy this, an ecclesiastical chancellor devised the writ of subpoena, compelling him to answer on oath as to his trust. It was evidently necessary also to restrain him from proceeding, as he might do, to obtain possession; and this gave rise to injunctions, that is, prohibitions to sue at law, the viola- tion of which was punishable by imprisonment as a contempt of EATON.EQ 2 18 OUIGIN AND HISTORY. (Ch. 1 diversifying the remedies so that they may be applied to all wrongs capable of redress, and protect the legal rights of suitors, has always given courts of equity an advantage over courts of common law, and tended to enlarge the exercise of the jurisdiction of the former. SEPARATE EQUITABLE TRIBUNALS ABOLISHED. 3. The separate tribunals of law and equity were abolished in England by the supreme court judicature act of 1873. By the supreme court judicature act of 1873,* the consti- tution of the courts of England was radically changed. By this act it was enacted that in every civil cause or matter law and equity shall be concurrently administered in one su- preme court of judicature created by uniting all the higher tribunals both of equity and common law, and that in all mat- ters not particularly mentioned in the act, where there is any conflict or variance between the rules of equity and the rules of common law, the rules of equity shall prevail. As a re- sult of this legislation, the legal and equitable jurisdictions are administered by the same court, and legal and equitable rights are enforced, and legal and equitable remedies are granted in the same action. 2 The line of demarkation be- court Other instances of breach of trust occurred In personal con- tracts, and others wherein, without any trust, there was a wrong committed beyond the competence of the courts of law to redress; to all which the process of subposna was made applicable. This extension of a novel jurisdiction was partly owing to a fundamental principle of our common law that a defendant cannot be exam- ined, so that, If no witness or written instrument could be pro- duced to prove a demand, the plaintiff was wholly debarred of jus- tice; but in a still greater degree to a strange narrowness and scrupulosity of the judges, who, fearful of quitting the letter of their precedents, even with the clearest analogies to guide them, repelled so many just suits, and set up rules of so much hardship, tlint men were thankful to embrace the relief held out by a tribunal acting In a more rational spirit 1 Hallam, Const Hist p. 4C9. 53. i 30 & 37 Viet. c. 66. By the supreme court of judicature act the court of chancery. 4) EQUITY JURISDICTION IN THE UNITED STATES. 19 tween legal actions and suits in equity was thus obliterated after the development and growth of both systems, side by side, through many centuries. But the principles of equity jurisprudence are still in force. Equitable doctrines, estates, and remedies still exist as part and parcel of a system as dis- tinct from the legal system as when separate tribunals were in active operation for the administration of justice. Nor have the importance and value of equitable principles been lessened by the consolidation of such tribunals. No modifi- cations can be introduced by statute into the judicial system of any civilized state whose institutions are directly or indi- rectly of English origin which will in any way abrogate the necessity for the use and application of principles which have always been administered by courts of equity. EQUITY JURISDICTION IN THE UNITED STATES. 4. The equity jurisdiction exercised in the United States courts and in the courts of the several states is founded upon, co-extensive with, and in most respects conformable to, that of England. When the American colonies became states, statutes were passed in many of them declaring that the English law in force on a certain day should be adopted by the courts of such states as the common law thereof, and should remain such until modified by legislation. In many states there was also contained in the same or similar statutes a declara- tion recognizing and adopting the equity jurisdiction of the English courts of chancery. In other states as New York, New Jersey, Maryland, Delaware, and South Carolina the constitutions provided for the establishment of courts of the court of queen's bench, the court of common pleas, the court of exchequer, the high court of admiralty, the court of probate, the court for divorce and matrimonial causes, and the London court of bankruptcy were united and consolidated in one supreme court of judicature, to consist of two divisions under the name of "Her Maj- esty's High Court of Justice" and "Her Majesty's Court of Appeal." 20 ORIGIN AND HISTORY. (Ch. 1 chancery. In still others the courts, without the interven- tion of constitutional or statutory provision, at once adopted the judicial system of the mother country. The federal constitution provides that the judicial power of the United States "shall extend to all cases in law and equity, arising under the constitution, the laws of the United States, and treaties made or which shall be made under their authority." * The uniform interpretation of this clause has been that by cases in equity are meant cases which, in the jurisprudence of England, are so called in contradistinc- tion to cases at common law. 2 The rules of the supreme court of the United States provide, and it has more than once been held, that, when not otherwise directed, the practice in the high court of chancery in England shall be followed.* And in states where courts of equity do not ex- ist, or where equity is administered by the same courts and in the same form as the common law, the procedure of the federal courts is regulated by the provisions of the United States constitution and statutes, and is not affected by the practice in the state courts. Federal courts are bound to administer equitable remedies uniformly throughout the United States in all cases to which they are applicable, where such remedies cannot be obtained in a common-law action, regardless of the statutes in force in the states where such courts are sitting.* I 4. i Const U. S. art. 3, 2. * Robinson v. Campbell, 3 Wheat. 223, 4 L. Ed. 372; Parsons v. Bedford, 3 Pet. 433, 447, 7 L. Ed. 732; Neves v. Scott, 13 How. 270, 14 L. Ed. 140; Boyle v. Zacharie, 6 Pet. 658, 8 L. Ed. 532. Mississippi Mills v. Cohn, 150 U. S. 202, 205, 14 Sup. Ct 75, 76, 87 L. Ed. 1052; Payne v. Hook, 7 Wall. 425, 430, 19 L. Ed. 260; Klrby v. Railroad Co., 120 U. S. 130, 138, 7 Sup. Ct 430, 30 L. Ed. 569; Bein v. Heath, 12 How. 168, 13 L. Ed. 939; Pennsylvania v. Bridge Co., 13 How. 518, 14 L. Ed. 249; Wells v. Pierce, 27 N. H. 503. * Equitable titles, though allowed to be set up in state courts in common-law suits, cannot be recognized in such suits in the federal courts. They must be made the subject of suits in equity. Rid- ings v. Johnson, 128 U. S. 217, 9 Sup. Ct. 72, 32 L. Ed. 401. See, also, Bodley v. Taylor, 5 Cranch, 191, 221, 222, 3 L. Ed. 75; Liv- ingston v. Story, 9 Pet 632, 9 L. Ed. 255; Watkins v. Holman's Lessee, 16 Pet 25, 26, 58, 59, 10 L. Ed. 873; Stinson v. Dousman, 20 4) EQUITY JURISDICTION IN THE UNITED STATES. 21 Administration of Equity in the Several States. Mr. Pomeroy says: "The American state courts do not derive their equitable powers, as they do their common-law functions, as a part of the entire common-law system of ju- risprudence which we have inherited from England, and which is assumed to exist even independently of legislation. Their equitable jurisdiction is wholly a creature of statute, and is measured in each state by the extent and limitations of the statutory -authority." B It may thus be seen that the details of the equity jurisdiction as it exists in any particular state can only be ascertained by a close study of the deci- sions and statutes of that state. In many of the states equi- ty is still administered by separate tribunals. Such states are New Jersey, Alabama, Delaware, Mississippi, and Ten- nessee. In Kentucky, the circuit courts have original juris- diction of all matters, both in law and equity ; but a special court is established in certain districts for the hearing and decision of all equitable actions which would otherwise be heard by the circuit courts of those districts. In many other states such as Maine, New Hampshire, Vermont, Massa- chusetts, Rhode Island, Connecticut, Pennsylvania, Mary- land, Virginia, West Virginia, Georgia, Florida, Texas, Ar- kansas, Michigan, Iowa, North Dakota, South Dakota, Colo- rado, Washington, and Oregon separate courts of equity have either never existed or have been abolished, and chan- cery powers are exercised by common-law courts, but the forms of action and procedure are retained. The state of New York, by its constitution of 1846, abolished courts of chan- cery, and conferred upon the supreme court general jurisdic- tion in law and equity, with all the powers possessed by the former court of chancery. 6 By the Code of Procedure enact- ed soon after the adoption of this constitution, the distinction between actions at law and suits in equity, and the forms of all such actions and suits, were abolished, and one form of How. 461, 464, 15 L. Ed. 966; Greer v. Mezes, 24 How. 268, 277, 16 L. Ed. 661; Noonan v. Lee, 2 Blackf. 499, 509, 17 L. Ed. 278; Walker v. Dreville, 12 Wall. 440, 20 L. Ed. 429; Basey v. Gallagher, 2O Wall. 670, 679, 22 L. Ed. 452. B 1 Pom. Eq. Jur. 282. "Const. 1846, art. 6, 6, and Id. art. 14, 5, 6. See present Const. 1894, art. 6, 1. 22 ORIGIN AND HISTORY. (Cfa. 1 action for the enforcement and protection of private rights and the redress of private wrongs was adopted, which is de- nominated a "civil action." T The example thus set by New York has been followed by North and South Carolina, Ohio, Indiana, Wisconsin, Minnesota, Missouri, Kansas, Nebras- ka, Wyoming, Idaho, Montana, Utah, California, and Ne- vada. The classification of states above made is in accordance with the manner and method of administering equity. In many of the states above classified the chancery powers dele- gated to the courts are substantially the same as those pos- sessed by the English court of chancery; but in others the delegation of power is special in its nature, and limited in its extent. In the states of Maine, New Hampshire, Massachu- setts, and Pennsylvania the chancery powers possessed by the courts were originally specified by statute ; and no pow- ers were thus possessed which were not so specified. New Hampshire and Massachusetts by subsequent statutes so ex- tended the equity jurisdiction of their courts that it is now practically unlimited. 8 But in Maine and Pennsylvania the statute still limits the equitable jurisdiction of the courts. The statutes of the other states differ in their methods of conferring the equitable jurisdiction, but it may be stated T Code Proc. (passed April 12, 1848) 69. See present Code Civ. Proc. 3339, which is as follows: "There is only one form of civil action. The distinction between actions at law and suits in equity, and forms of those actions and suits, have been abolished." By Gen. St. N. H. 18(57, p. 388, c. 190, 1, the supreme court has the powers of a court of equity in all cases cognizable in such courts, and may hear and determine according to the course of equity in cases of charitable uses, trusts, fraud, accident, or mis- take; of the affairs of co-partners, Joint tenants or owners, or ten- ants In common; of the redemption and foreclosure of mort- gages, etc., "and In all other cases where there is not a plain, ade- quate, and complete remedy at law, and such remedy may be had by proceedings according to the course of equity." In Massachu- setts It was provided by St. 1877. c. 178, p. 558, 1, that: "The supreme Judicial court shall have Jurisdiction in equity of all cases and matters of equity cognizable under the general principles of equity Jurisprudence, and in respect of all such cases and matters shall be a court of general equity jurisdiction." This Jurisdiction was conferred in 1883 upon the superior court, which now has con- current equity Jurisdiction with the supreme Judicial court 4) EQUITY JURISDICTION IN THE UNITED STATES. 23 generally that the extraordinary jurisdiction of the English courts of chancery has been transferred to and adopted by the courts of such states practically without limitation as to scope and nature. 9 It is evident that the greatest change in the equity juris- diction has been made in those states in which the distinc- tion between legal and equitable forms of action has been abolished, and one form of action adopted to take the place of both. But even in those states the equitable principles according to which the rights of parties are to be determined remain unchanged. The change in procedure and in judi- cial systems was not intended to secure an interference with or modification of the existing rules and principles of equity unless questions of equity pleading and procedure are in- volved, or unless such rules and principles affect the sep- arate and distinct character of the equity jurisdiction. 10 The 9 Mr. Pomeroy, in his Equity Jurisprudence (volume 1 [2d Ed.] 283-288), attempts a classification of the states in respect to the amount of equity jurisdiction possessed by the state courts. He divides the states into four classes: (1) Where statutes or consti- tutions confer an equity jurisdiction identical or co-extensive with that possessed by the English court of chancery; (2) where the constitutions, not in express terms, but by implication, create and confer an equity jurisdiction substantially the same as that pos- sessed by the English court of chancery, except so far as modified or limited by statute; (3) where the constitutions and statutes do not confer a general equity jurisdiction by any single comprehensive provision, or single grant of power, but enumerate and specify the heads or divisions of equity jurisprudence over which the jurisdic- tion of the courts. shall extend, with various restrictions and lim- itations; (4) where the constitutions and statutes, in their grants of jurisdiction to the courts, make no distinction between, nor even any mention of, either "law" or "equity." These are the states which have abandoned the forms of procedure inherited from Eng- land, and adopted the reformed American procedure. Their con- stitutions and statutes confer upon the courts complete power and jurisdiction to hear and determine all civil cases, or to grant all civil remedies; and they thus implicitly include a full jurisdiction in cases and over remedies of an equitable character, as well as those of a legal nature. 10 The following note in 1 Abb. N. Y. Dig. tit. "Actions," p. 31, is Instructive as showing the effect of the abolition of the distinctions between legal and equitable forms of actions, as declared by the court of appeals in New York: "The following principles may now 24 ORIGIN AND HISTORY. (Ch. 1 only result sought or attained by abolishing the distinction between law and equity procedure was to unify the instru- mentalities, modes, and external forms by which justice is be deemed settled by the decisions of the court of appeals, and rec- ognized by good authority in practice: First. It is only the distinc- tion between different forms of actions or suits that Is abolished. The difference between legal relief (by which is understood, in general, compensation in damages), and equitable relief (by which is understood, in general, specific relief, such as courts of law could not grant), is inherent, and the essential facts which constitute the right to relief of either kind are unchanged; suitors will ask for one or the other or both, according to the nature of the facts. Cole v. Reynolds, 18 N. Y. 74; Goulet v. Asseler, 22 N. Y. 225. Second. Where the same facts entitle plaintiff to both kinds of relief, both may be administered in one action. All the relief to which a party is entitled, arising from the same transaction, may be obtained in one suit Corning v. Nail Factory, 40 N. Y. 191; Lattin v. McCarty, 41 N. Y. 107. Upon the same principle, when, as is often the case, the facts would sustain plaintiffs claim to legal relief, and yet would entitle defendant to equitable relief inter- fering with and nullifying the former, the whole matter can be adjusted in one action. In other words, purely equitable defenses are available against strictly legal causes of action. Crary v. Good- man, 12 N. Y. 266, 64 Am. Dec. 506; Phillips v. Gorham, 17 N. Y. 270. And, on the other hand, in an action for legal relief, a mat- ter which would have been a bar in an action at law is not such if It would not have been in equity. Cole v. Reynolds, 18 N. Y. 74. Third. It is no objection to Joining distinct causes of action or defenses in one action that they require different kinds of relief. Phillips v. Gorham, 17 N. Y. 275; Lattin v. McCarty, 41 N. Y. 107." As to the effect of abolishing such distinction in other states, see De Witt v. Hays, 2 Cal. 463, 56 Am. Dec. 352; Woodford v. Leav- en worth, 14 Ind. 311; Matlock v. Todd, 25 Ind. 128; Claussen v. La Frenz, 4 G. Greene (Iowa) 224; Russell v. Minnesota Outfit, 1 Minn. 162 (Gil. 136); Maguire v. Vice, 20 Mo. 429; Richardson v. Means, 22 Mo. 495; Hunter v. Hunter, 50 Mo. 445; Matthews v. McPherson, 65 N. C. 189; Burrage v. Mining Co., 12 Or. 169, 6 Pac. 766; Sykes v. Bank, 2 S. D. 242, 49 N. W. 1058. The functions of Judges in dealing with equitable principles in equitable cases are as well set- tled a part of the judicial power, and as necessary to its adminis- tration, as the functions of juries in common-law cases, and it is not in the power of the legislature to take them away. It was, therefore, held that the constitution of Michigan (Art 6, S 5), which authorizes the legislature to abolish, as far as practicable, dis- tinctions between law and equity proceedings, only authorizes the removal of nominal distinctions. Brown v. Circuit Judge, 75 Mich. 274, 42 N. W. 827, 5 L. B. A. 226. 4) EQUITY OF JURISDICTION IN THE UNITED STATES. 25 administered, rights are protected, and remedies are con- ferred, without affecting the settled principles, doctrines, and rules of equity jurisprudence and equity jurisdiction. 11 11 Mr. Pomeroy in his Equity Jurisprudence (volume 1, 2d Ed. 354) says: "To sum up this result in one brief statement, all equitable estates, Interests, and primary rights, and all the prin- ciples, doctrines, and rules of the equity Jurisprudence by which they are defined, determined, and regulated, remain absolutely un- touched, in their full force and extent, as much as though a sepa- rate court of chancery were still preserved. In like manner all equi- table remedies and equitable rights that is, the equitable causes of action, and the rights to obtain the reliefs appropriate therefor, and the doctrines and rules of equity jurisdiction which govern and regulate; not the mere mode of obtaining them, but the fact of obtaining such remedies also remain wholly unchanged, and still control the action of courts in the administration of Justice." 26 GENERAL PRINCIPLES GOVERNING. (Ch. 2 CHAPTER II. GENERAL PRINCIPLES GOVERNING THE EXERCISE OF EQUITY JURISDICTION. 6. Equity and the Common Law. 6. Equity Jurisdiction Defined. 7. Exercise of Equity Jurisdiction. 8. Adequate Remedy at Law. 9. Multiplicity of Suits. 10. Retention of Jurisdiction to Award Complete Relief. 11. Effect of Acquisition by Courts of Law of a Jurisdiction Similar to that of Equity. 12. Auxiliary Jurisdiction of Equity. EQUITY AND THE COMMON LAW. 6. The original relationship of equity and the com- mon law has been materially modified by (a) The gradual adoption and application by law courts of equitable doctrines, (b) Legislative enactments. Many important doctrines formerly recognized by courts of equity alone have, in modern times, been adopted and ap- plied by courts of law. The rigid adherence of the common law to precedent, and a strict application of the forms and notions of the ancient law, have been gradually lessened, so that now many of the rules in force in courts of law are as equitable and righteous in their nature as those applied in courts of equity. 1 Statutes have been enacted which have directed the application of equitable principles in all courts, producing in many instances an amelioration of the hardships of the common law, and imposing upon courts of law, in such instances, a jurisdiction which had hitherto been exclusively cognizable in courts of equity. The statutes here referred to are not those modifying the forms of procedure, and pro- viding for the administration of legal and equitable rules by S 5. * Pom. Eq. Jur. 5 69. i) EQUITY AND THE COMMON LAW. 27 the same courts, but those having for their object the gen- eral use of equitable principles and doctrines in all courts. It is not necessary at this time to specify in detail all these changes. Among the most important, perhaps, are those af- fecting the rights and property of married women. Stat- utes have been passed in nearly all the states abrogating the common-law rules giving the husband an ownership or in- terest in his wife's property ; and by such statutes she is gen- erally given the same power to manage her property and make contracts in respect thereto as if she were unmarried. These statutes vary in their extent in the several states ; but in all of them the effect upon the equitable jurisdiction has been very great. Equity has always intervened for the pro- tection of married women as against the frequent hardships resulting from the application of legal rules. But the neces- sity for this intervention is taken away when statutes confer upon married women the right of full legal ownership. Statutes in the American states govern the administration of estates of decedents, and the care and custody of the per- sons and property of infants. For this purpose surrogates' or probate courts have been created, and the equitable rules relating to the settlement of such estates and the manage- ment of the property of infants have been enacted in statu- tory form to be enforced in such courts, to the practical ex- clusion of the equitable jurisdiction. Among other instances of the modification of the relation existing between the two jurisdictions by statutory enact- ment is the abrogation of the distinction between sealed and unsealed instruments. At law a sealed instrument could on- ly be discharged by another instrument of as high a char- acter, or by a delivery and cancellation of the sealed instru- ment. -Equity, regarding the real relations of the parties, looked beyond the seal, and gave force to the real fact of the payment or satisfaction of the sealed instrument. Stat- utes in many states have declared that the equitable rule shall be universally applied, and have abolished the distinction be- tween sealed and unsealed instruments. Many other instances of the legislative enunciation of equi- table principles might be mentioned. The present purpose is merely to emphasize the fact that the relations existing 28 GENERAL PRIXCIPLES GOVERNING. (Ch. 2 between the two systems of equity and the law are not now the same as when equity was in its infancy, and the common- law undeveloped. These changes have made useless the dis- cussion of many equitable doctrines which have become ob- solete, since all occasion for their application has been re- moved. EQUITY JURISDICTION DEFINED. 6. Equity jurisdiction, as distinguished from the common-law jurisdiction, is the power to hear certain kinds and classes of civil causes according to the principles of the method and procedure adopted by the court of chan- cery, and to decide them in accordance with the doctrines and rules of equity jurisprud- ence. 1 Ordinarily, the term "jurisdiction" means the power pos- sessed by a court to determine judicially a case presented to it for decision. If such power is not possessed in reference to a particular case, the determination of the court in re- spect thereto is of no force or effect. This strict meaning of the term is not generally applied when used in connection with courts of equity. An action may not properly be brought in a court of equity, and yet its judgment therein is not necessarily null and void, unless objection be made by the defendant at the commencement of the action.* A court of equity cannot try issues arising in the prosecu- tion of a criminal indictment, and its judgment therein would be unenforceable. Equity can neither prevent the commis- sion of crimes, 8 interfere with their prosecution, 4 nor par- i 6. i Pom. Eq. Jur. | 129. Cummlngs v. Mayor, etc., 11 Paige (N. Y.) 596; Bank of Utlca T. Mersereau, 8 Barb. Ch. (N. Y.) 528; Creely v. Brick Co., 103 Mass. 614. * Equity will not restrain the issuance of licenses to gamblers by the officers of a fair association, since gambling is a violation of * See note 4 on following page. 6) EQUITY JURISDICTION DEFINED. 29 don a punishment. But a person who is menaced in his property rights by the unlawful act of another is not pre- cluded from suing in equity merely because the unlawful act is also a crime. It is only when the injury is general and public in its effects, and no private right is violated, in con- tradistinction to the rights of the rest of the public, that in- dividuals are precluded from bringing suits. 5 the Criminal Code, which affords ample means for its suppression. Cope v. Association, 90 111. 489. And injunction has been refused against a violation of the Sunday laws. State v. Schweickardt, 109 Mo. 406, 19 S. W. 47; Sparhawk v. Railway Co., 54 Pa. 401. * It was laid down in an early case (1742) by Lord Hardwicke that chancery has no restraining power over criminal prosecutions. Mayor, etc., of York v. Pilkington, 2 Atk. 302. And see, also, Mon- tague v. Dudman, 2 Ves. Sr. 396, 398; Attorney General v. Cleaver, 18 Ves. 218; Turner v. Turner, 15 Jur. 218; Saull v. Browne, 10 Ch. App. 64. In our courts the same principle has been generally unheld. West v. Mayor, etc., 10 Paige (N. Y.) 539; Davis v. Society, 75 N. Y. 362; Tyler v. Hamersley, 44 Conn. 419, 422, 26 Am. Rep. 479; Stuart v. Board, 83 111. 341, 25 Am. Rep. 397; Devron v. First Municipality, 4 La. Ann. 11; Moses v. Mayor, etc., 52 Ala. 198; Gault v. Wallis, 53 Ga. 675; Phillips v. Mayor, etc., 61 Ga. 386; Cohen v. Goldsboro Com'rs, 77 N. C. 2; Waters Pierce Oil Co. v. City of Little Rock, 39 Ark. 412; Spink v. Francis (C. C.) 19 Fed. 670; Spink v. Francis (C. C.) 20 Fed. 567; Suess v. Noble (C. C.) 31 Fed. 855; In re Sawyer, 124 U. S. 210, 8 Sup. Ct. 482, 31 L. Ed. 402; Hemsley v. Myers (C. C.) 45 Fed. 283; Crighton v. Dahmer, 70 Miss. 602, 13 South. 237, 21 L. R. A. 84, 35 Am. St Rep. 666; Chisholm v. Adams, 71 Tex. 678, 10 S. W. 336; Poyer v. Village of Des Plaines, 123 111. Ill, 13 N. E. 819. o The fact that the accumulation of nitroglycerin within the cor- porate limits of a city is made a crime does not prevent a private citizen from securing an injunction, where, in case of an explosion, he would suffer an injury in person or property not sustained by the public in general. People's Gas Co. v. Tyner, 131 Ind. 277, 31 N. E. 59,' 16 L. R. A. 443, 31 Am. St. Rep. 433; Greenfield Gas Co. v. Gas Co., 131 Ind. 599, 31 N. E. 61. And a threatened violation of an ordinance prohibiting the erection of wooden buildings with- in the fire limits of a city will be enjoined at the suit of private persons, who would sustain irreparable injury, though the build- ing would not be a nuisance per se. First Nat. Bank of Mt. Ver- non v. Sarlis, 129 Ind. 201, 28 N. E. 434, 28 Am. St. Rep. 185. The fact that a nuisance is a crime, and punishable as such, does not deprive equity of its jurisdiction to restrain and abate by injunc- tion. Minke v. Hopeman, 87 111. 450, 29 Am. Rep. 63; Blanc v. Murray, 36 La. Ann. 162, 51 Am. Rep. 7. 30 GENERAL PRINCIPLES GOVERNING. (Ch. 2 EXEKCISE OF EQUITY JURISDICTION. 7. To warrant the exercise of equity jurisdiction, either (a) The cause of action must involve the main- tenance, or protection of an equitable right, estate, or interest; or (b) The remedy sought must be in its nature purely and exclusively equitable; or (c) The remedy afforded by common law must be inadequate, and the remedy sought in equity one which, under the facts and circum- stances of the case, can only be made com- plete and adequate through equitable modes of procedure. There are many titles and interests not cognizable at law. The common law recognizes none but the legal title. He who seeks the aid of a law court must base his demand upon his legal title. Without such title his suit will not succeed. But frequently the legal title to an estate is vested in one person, while the right to its use and enjoyment is in anoth- er. This right constitutes an equitable interest, which, being ignored by the common-law, can only be preserved and pro- tected in equity. This right is generally termed a trust es- tate, and the person holding the estate is the trustee, and the person for whose benefit the trust is held is the beneficiary, or cestui que trust. 1 Many other rights, titles, and interests in property have been created by equity which were unknown at common law, and which have never been recognized in law courts. Among these are the mortgagor's equity of re- demption,* and the rights of assignees of choses in action,' and of equitable lienors.* Cases involving the enforcement, |7. i See post c. 14, p. 354. See post, c. 17, p. 408. See post, c. 19, p. 493. See post, c. 18, p. 474. 8) ADP:QUATE REMEDY AT LAW. 31 maintenance, and protection of these equitable rights fall within the exclusive jurisdiction of courts of equity. Unless otherwise provided by legislative enactment, such cases are never cognizable by courts of law. There are also purely equitable remedies, which are ad- ministered by courts of equity, and not by courts of law. These remedies do not necessarily depend upon the estate involved for their equitable character. They are equitable because they can only be obtained in courts of equity. A suit for quieting title, or for removing a cloud upon title by the cancellation of an adverse instrument, may result in the establishment of a legal estate ; but, nevertheless, the remedy itself is within the exclusive jurisdiction of a court of equity. A suit for the specific performance of a contract is within this exclusive jurisdiction, although an action might be main- tained at law for the recovery of damages for the breach of the contract sought to be enforced. ADEQUATE REMEDY AT LAW. 8. Equity has no jurisdiction where there is an adequate, complete, and certain remedy at law. If the law falls short of what the suitor is entitled to, if it does not furnish him full and complete justice, or if it affords him a remedy which is doubtful or obscure, a jurisdiction in equity is established. 1 8. i Story, Eq. Jur. 33. And see National Bank of Commerce of Tacoma, Wash., v. Wade (C. C.) 84 Fed. 10; Grand Trunk Ry. Go. v. Railroad Oo. (C. C.) 85 Fed. 87. A singular and interesting case Involving the question of the power of equity to intervene where no remedy exists at law is that of Dr. David Kennedy Corp. v. Kennedy, 165 N. Y. 353, 59 N. E. 133, 55 N. Y. Supp. 917. In this case the defendant was engaged in the manufacture and sale of proprietary remedies, and sold to the plaintiff, a corporation, his business and the sole and absolute right to use his name and address, viz. the names, "Dr. David Kennedy, of Rondout, N. Y., or Dr. D. Kennedy, Rondout, N. Y., in connection with the manu- facture of proprietary medicines," which business was largely car- ried on by advertising and correspondence under such names. It 32 GENERAL PRINCIPLES GOVERNING. (Ch. 2 The inadequacy of the legal remedy may be said to be the foundation of the concurrent jurisdiction of courts of equity. The concurrent jurisdiction covers all cases in which no ade- quate remedy can be obtained at law except by circuity of action or by multiplicity of suits, and adequate and complete relief can be given in equity in one and the same action ; as in the cases of accident, mistake, and fraud. Whenever a court of law is competent to take cognizance of a right, and has power to proceed to a judgment which affords adequate, complete, and certain relief, the plaintiff must proceed at law, because the defendant has a constitu- tional right to a trial by jury. 2 This principle has been ob- served, not, perhaps, from the very earliest period of the recorded history of the English chancery court, but certain- ly ever since equity jurisprudence has been reduced to a defi- nite system. 8 Courts of equity have steadily refused to en- tertain jurisdiction of actions for the recovery of land when the legal remedy by ejectment is adequate,* and so, where was held that the purchaser had an absolute right to use such names and addresses. Where It afterwards appears that the seller is receiving and opening letters belonging to the corporation, addressed in the forms aforesaid, such acts are properly restrained by injunction. But since the parties, by their contract, made it difficult to so separate their letters as to give each Its or his own, and their relations are so unfriendly that neither should be allowed to receive and open letters of a confidential character Intended for the other, the court directed the appointment of a referee, with power to receive, open, and read all letters sent to such names and addresses, and to make prompt distribution of the same according to their true destination. * Hipp v. Babln, 19 How. 271, 277, 15 L. Ed. 633; Lewis v. Cocks, 23 Wall. 466, 467, 23 L. Ed. 70; Smyth v. Banking Co., 141 U. S. 656, 12 Sup. Ct 113, 35 L. Ed. 891; Kllllan v. Ebbinghaus, 110 U. S. 568, 573, 4 Sup. Ct. 232, 28 L. Ed. 246; Porter v. Water Co., 84 Me. 195, 24 Atl. 814; Watson v. Ferrell, 34 W. Va. 406, 12 S. E. 724; McMlllen v. Mason, 71 Wis. 405, 37 N. W. 253; Williams v. Haynes, 78 Ga. 133; A very v. Woolen Co., 82 N. Y. 582; Alger v. Anderson (C. C.) 92 Fed. 696; Turtle v. Batchelder & Lincoln Co., 170 Mass. 81"). 49 N. E. 640; Pulezer v. Kucharzyk. 116 Mich. 92, 74 N. W. 304. Lewis v. Cocks, 23 Wall. 466, 467, 23 L. Ed. 70; Tenham T. Her- bert, 2 Atk. 483. Cox v. Boyleston, 57 Ala. 270; Lewis v. Cocks, 23 Wall. 466, 23 L. Ed. 70; Danforth v. Roberts, 20 Me. 307; Weiss v. Levy, 166 Mass. 290, 44 N. E. 225; McClanahan v. West, 100 Mo. 309, 13 S. 8) ADEQUATE REMEDY AT LAW. the controversy involves merely the legal title to lands, there is an adequate remedy at law, and equity has no jurisdiction. 5 And equity will not assume jurisdiction of a case involving a question of unliquidated damages for a tort. 8 Where, by the commission of a tort in the conversion of personal prop- erty, a right to damages has accrued to a person, the rem- edy is at law, and there is no reason for a resort to equity. 7 And in cases arising from violations of contract obligations, where the plaintiff may be amply compensated by an award of damages, the legal remedy is adequate, and a suit in equity will not lie. 8 A suit in equity cannot be maintained to re- W. 674; Hay thorn v. Margerem, 7 N. J. Eq. 324; Mead v. Camfield, 11 N. J. Eq. 38; Hoores v. Townshend, 102 N. Y. 387, 393, 7 N. E. 401; Jenkins v. Hannan (C. C.) 26 Fed. 657 (in this case it was sought to set aside deeds made on orders of sale of lands in judi- cial proceedings, which were alleged to be null and void, and for an account of rents and profits; it was held that there was a plain and adequate remedy at law by an action of ejectment for the recovery of the possession of the lands and the mesne profits, and that equity has no jurisdiction); Dalton v. Hamilton, 50 Cal. 422; Daniel v. Green, 42 111. 471; Wells v. Lamney, 88 111. 174; Janney v. Spedden, 38 Mo. 395; Bobb v. Woodward, 42 Mo. 482; Odle v. Odle, 73 Mo. 289; Harper v. Crawford, 13 Ohio, 129; Long's Appeal, 92 Pa. 171. s Lacassagne v. Chapuis, 144 U. S. 119, 12 Sup. Ct. 659, 36 L. Ed. 368; Watts v. Frazer, 80 Ala. 186; Freeman v. Timanus, 12 Fla. 393; Hinton v. Fox, 13 Ky. 380; Campbell v. Whittingham, 28 Ky. 96, 20 Am. Dec. 241; Brown's Heirs v. Brown's Devisees, 31 Ky. 39; Cowman v. Colquhoun, 60 Md. 127; Ragland v. Green, 22 Miss. 194; Waddell v. Beach, 9 N. J. Eq. 793; Barry v. Shelby, 5 Tenn. 229; Seeley v. Baldwin, 185 111. 211, 56 N. E. 1075; Campbell v. Adsit, 111 Mich. 575, 70 N. W. 141; Leininger v. Railroad Co., 180 Pa. 288, 36 Atl. 738. Brown v. Railway Co., 96 111. 297; Crislip v. Cain, 19 W. Va. 438. T Lacombe v. Forstall, 123 U. S. 562, 8 Sup. Ct. 247, 31 L. Ed. 255; Bay City Bridge Co. v. Van Etten, 36 Mich. 210. Walker v. Brown, 63 Fed. 204, 11 C. C. A. 135; Turner v. Flinn, 67 Ala. 529; Powell v. Maguire, 43 Cal. 11 (in this case two persons agreed to form a partnership to do certain work, but the partner- ship was never launched, and one of the persons carried on the work alone. It was held that the only remedy for the person excluded was in an action at law for breach of contract); West v. Howard, 20 Conn. 581; Kellogg v. Moore, 97 111. 282; Coquillard Y. Suydani, 8 Blackf. (Ind.) 24; Slaughter v. Nash, 1 Litt. (Ky.) 324. EATON.EQ. 3 34 GENERAL PRINCIPLES GOVERNING. (Ch. 2 scind an agreement for the sale of real estate by reason of a defect in the title, or a want of power to sell in the ven- dors. Such a suit is unnecessary, since there is a perfect defense to any action which might be brought by the ven- dors to enforce the agreement. 8 The mere fact that dam- ages for breach of contract cannot be ascertained with preci- sion does not warrant a court of equity in issuing an injunc- tion and decreeing specific performance. 10 But there are many cases where courts of equity have concurrent jurisdic- tion with courts of law, and courts of equity may then as- sume jurisdiction, although courts of law may afford a rem- edy. But such concurrent jurisdiction will not be exercised unless there is some equitable circumstance to give jurisdic- tion ; such as fraud, irreparable injury, trust, accident, or the like. 11 And where a court of equity has once assumed ju- risdiction it cannot be ousted by a subsequent proceeding in a court of law. 12 Nor will courts of equity be ousted of their original jurisdiction because courts of law have adopted equi- table principles. 18 But, unless the legal remedy is plain, adequate, and complete, and as practical in its results, and as efficient in the administration of justice, as the equitable rem- Equlty will not take Jurisdiction of an action to recover a simple debt on the ground that a pretended payment thereon was fraudu- lent. Andrews v. Moen, 162 Mass. 294, 38 N. E. 505. And see AJdrich v. Lewis, 60 Miss. 229; Strong v. Krebs, 63 Miss. 338; Linn T. Gunn, 56 Mich. 447, 23 N. W. 84; Dougherty v. Hughes, 165 111. 884, 46 N. E. 229. Bruner v. Meigs, 64 N. Y. 506, 515; Rellley v. Roberts, 34 N. J. Eq. 299; Blair v. Brabson, 3 Hayw. (Tenn.) 18; Bier v. Smith, 25 W. Va. 830. 10 Texas & P. Ry. Co. v. City of Marshall, 136 U. S. 393, 10 Sup. Ct 846, 34 L. Ed. 385. 11 Robinson v. Chesseldlne, 4 Scam. (111.) 332; Nelson v. Betts, 21 Mo. App. 219; Phalen v. Clark, 19 Conn. 421, 1 Am. Rep. 253. is Galnty v. Russell, 40 Conn. 450; Meyer v. Saul, 82 Md. 459, 83 Atl. 539. n Walker v. Cheever, 35 N. H. 339; Heath v. Bank, 44 N. H. 174; Wesley Church v. Moore, 10 Pa. 273, 279, 280; Sweeny v. Williams, 36 N. J. Eq. 627; Schroeder v. Loeber. 75 Md. 195, 23 Ail. f.79, 24 Atl. 226; Gridley v. Garrison, 4 Paige (N. Y.) 647; Minturn v. Trust Co., 3 N. Y. 498; Bell v. Dewoody, 1 Overt (Teun.) 478; Meek v. Spacher, 87 Va. 162, 12 S. E. 397. 9) MULTIPLICITY OF SUITS. 35 edy, the jurisdiction in equity will attach. 14 Thus, a vendee of land will be compelled in equity to pay the agreed price, though the vendor has also a remedy at law by action for breach of contract ; 1B and, where a case involves such a mass of accounts and complications as to make the remedy at law inconvenient, if not actually inadequate, equity will take ju- risdiction. 1 * The remedy at law must be as practical and efficient to the ends of justice and its prompt administration as the remedy in equity. 17 An erroneous adjudication that the legal remedy is inadequate, and that the case is, there- fore, of equitable cognizance, is not, however, necessarily void, within the meaning of the general rule that the judg- ment of a court not having jurisdiction of the subject-matter is an absolute nullity, and may be attacked collaterally. 18 MULTIPLICITY OF SUITS. 9. Equity will exercise its jurisdiction to prevent multiplicity of suits. (a) Where the nature of the wrong- is such that at law it would be necessary for the injured party, in order to obtain complete relief, to bring a number of actions, arising from the Tyler v. Savage, 143 U. S. 79, 95, 12 Sup. Ct 340, 36 L. Ed. 82; Kilbourn v. Sunderland, 130 U. S. 505, 9 Sup. Ct. 594, 32 L. Ed. 1005; Thompson v. Allen Co., 115 U. S. 550, 6 Sup. Ct. 140, 29 L. Ed. 472; City of Hartford v. Chipman, 21 Conn. 488; Bierbower's Appeal, 107 Pa. 14; Warner v. McMullin, 131 Pa. 370, 18 Atl. 1056; Board of Chosen Freeholders of Essex Co. v. Bank, 48 N. J. Eq. 51, 21 Atl. 185; Hodges v. Rowing, 58 Conn. 12, 18 Atl. 979, 7 L. R. A. 87; Nease v. Insurance Co., 32 W. Va. 283, 9 S. E. 233; Cadigan v. Brown, 120 Mass. 403; Darrah v. Boyce, 62 Mich. 480, 29 N. W. 102; Overrnire v. Haworth, 48 Minn. 372, 51 N. W. 121; Walker v. Daly, 80 Wis. 222, 49 N. W. 812. IB Hodges v. Kowing, 58 Conn. 12, 18 Atl. 979, 7 L. R. A. 87. i Warner v. McMullin, 131 Pa. 370, 18 Atl. 1056. it Barthet v. City of New Orleans (C. C.) 24 Fed. 563; Rees v. Smith, 1 Ohio, 124, 13 Am. Dec. 599; Smith v. Machine Co., 79 UL App. 519; Boyd v. Carbon Black Co., 182 Pa. 206, 37 Atl. 937. is Mellen v. Iron Works, 131 U. S. 352, 367, 9 Sup. Ct. 781, 33 L. Ed. 178; Goodman v. Winter, 64 Ala. 410, 432, 38 Am. Rep. 13. 86 GENERAL PRINCIPLES GOVERNING. (Ch. 2 same wrongful act, against the same wrong- doer. (b) Where a party institutes, or is about to in- stitute, a number of successive or simultane- ous actions against another party, all de- pending upon the same legal questions and similar issues of fact. (c) Where a number of persons have separate and distinct rights of action against the same party, arising from the same cause, governed by the same legal rule, and involv- ing similar facts, and the circumstances are such that the rights of all may be settled in a single suit, brought by one of such per- sons in behalf of all. (d) Where a party claims a common right against a number of persons, the establishment of which would require a separate legal action brought by him against each of such per- sons, and which are of such a nature that they might be determined in a single suit in equity brought against all of such per- sons. 1 It is a familiar rule governing common-law procedure that no action will lie upon a contract unless all the parties named as plaintiffs have a joint and common interest in the contract. If there are many distinct and adverse interests at stake, it is not possible to adjust them by a single suit at law. It is the inadequacy of the law to combine and adjust manifold and adverse claims and interests which gives rise to the ju- I 9. * The above division of the cases In which equity will Inter- rene to prevent multiplicity of suits Is substantially the same as that adopted by Prof. Pomeroy In his celebrated work on Equity Jurisprudence (section 245), and is probably as satisfactory as any that can be made. 9) MULTIPLICITY OF SUITS. 37 risdiction of equity to settle and dispose of the whole con- troversy in a single proceeding, and thus prevent a multi- plicity of suits. The exercise of this jurisdiction has sometimes assumed the form of an injunction, called a "bill of peace," to restrain the prosecutions of the several actions seeking to litigate the same right. The earliest instances of the intervention of equity in such cases seem to have been for the purpose of establishing a general right in behalf of one party as against a number of persons claiming distinct and individual inter- ests ; or for the purpose of restraining further actions of ejectment to recover the premises by a single adverse claim- ant, after several successive actions had already been pros- ecuted without success. Equity will not assume jurisdiction to prevent multiplicity of action unless it appears that the suits which have been or are about to be instituted are based upon a valid cause of action, and it has been held that a court of equity would not intervene unless it appeared that the party had some defense to the numerous suits brought, or about to be brought, against him. 8 Suits between Two Parties. The first and second classes mentioned in the black let- ter text refer to suits brought by one party against another. Among the cases belonging to the first class, where a per- son would be obliged to bring a number of actions at law in succession in order to secure complete, or even partial, relief, and in which equity will interfere to prevent multiplicity of suits, are actions to abate nuisances, 8 to restrain continuous waste, 4 continuous trespass, 6 and to settle disputed bound- aries, involving acts of trespass by the defendant. The sec- ond class of cases includes those where successive actions of ejectment have been brought by one person against another, Storrs v. Railroad Co., 29 Fla. 617, 11 South. 226. Corning v. Nail Factory, 39 Barb. (N. Y.) 311, 327; Cadigan v. Brown, 120 Mass. 493; Carlisle v. Cooper, 21 N. J. Eq. 576; Scheetz'a Appeal, 35 Pa. 88; Sheldon v. Rockwell, 9 Wis. 166, 76 Am. Dec. 265. * Hughlett v. Harris, 1 Del. Ch. 349, 352. 5 Hacker v. Barton. 84 111. 313; Livingston v. Livingston, 6 Johns. Ch. (N. Y.) 497; Wheelock v. Noonan, 108 N. Y. 179, 186, 15 N. EL 67; Murdock Y. Railroad Co., 73 N. Y. 579. 88 GENERAL PRINCIPLES GOVERNING. (Ch. 2 and the defendant finally resorts to a suit in equity to quiet his title, and to restrain all further actions of ejectment by the plaintiff; 6 and also those where numerous simultaneous actions are brought against one party by another, all involv- ing the same questions, and the party proceeded against ap- plies to a court of equity for the purpose of having all the actions decided by one trial and decree. 7 Suits between One Party and a Number of Parties. The jurisdiction of equity to prevent multiplicity of suits whenever numerous persons have a community of interest or a common right or title in the subject-matter of controversy, has been long established ; and it is immaterial whether the right be asserted by one against many, or by many against one. It has been frequently stated that equity will assume jurisdiction whenever the rights of the numerous persons de- pend for solution on the same questions of law and fact, though purely legal rights are involved, and purely legal re- lief can be conferred. 8 This statement of the rule has been criticized, and it is asserted that, when no community of in- terest in the subject-matter of the suit subsists between the numerous persons, there must exist some recognized ground lor equitable interference, aside from mere multiplicity of suits. In a comparatively recent Mississippi case * it ap- peared that a number of persons sued a railroad company at law for the destruction of their property by fire, alleged to have been caused by the negligence of the defendant. The company then filed its bill in equity to enjoin the prosecu- tion of the actions at law, and to compel a determination of the whole matter in a single suit in equity, on the ground that the same questions of law and fact were involved in each case. The court, after an exhaustive review of all the authorities, Eldridge v. Hill, 2 Johns. Ch. (N. T.) 281; Woods v. Monroe, 17 Mich. 238; Patterson v. McCamant, 28 Mo. 210. T Third Ave. It. Co. v. Mayor, etc., 54 N. Y. 159; West v. Same, 10 Paige (N. Y.) 539; Kensington v. White. 3 Price, 164. Pom. Eq. Jur. 250, 209; Phelps, Jud. Eq. 230; Preteca v. Land Grant Co., 4 U. 8. App. 826, 1 C. C. A. 607, 50 Fed. 674; Osborne v. Railroad Co. (C. C.) 43 Fed. 826. Trlbette v. Railroad Co. (1892) 70 Miss. 182, 12 South, 32, 19 L. R. A. 000, 35 Am. St Rep. 642. 10) RETENTION OF JURISDICTION TO AWARD RELIEF. 39 denied the equity jurisdiction in such cases ; saying : "There must be some recognized ground of equitable interference, or some community of interest in the subject-matter of the con- troversy, or a common right or title involved, to warrant the joinder of all in one suit; or there must be some common purpose in pursuit of a common adversary, where each may resort to equity, in order to be joined in one suit; and it is not enough that there is a community of interest, merely, in the questions of law or fact involved." 10 RETENTION OF JURISDICTION TO AWARD COM- PLETE RELIEF. 10. When once equity has interfered to prevent a wrong or to preserve a right, it -will retain its jurisdiction until a complete remedy is afforded, although it may be necessary to determine purely legal questions. 1 Lord Nottingham has said : "Where this court can deter- mine the matter, it shall not be a handmaid to other courts, nor beget a suit to be ended elsewhere." 2 When once the 10 The following cases may be cited in support of the opinion of the court in the above-cited Mississippi case: Leliigh Val. R. Co. v. McFarlan, 31 N. J. Eq. 730; National Park Bank of New York v. Goddard, 131 N. Y. 494, 30 N. E. 566; Hanstein v. Johnson, 112 N. C. 253, 17 S. E. 155; Northern Pac. R. Co. v. Amacker (C. C.) 46 Fed. 233. 10. i Ober v. Gallagher, 93 U. S. 199, 23 L. Ed. 829; Houston v. Faul, 86 Ala. 232, 5 South. 433; Ord v. McKee, 5 Cal. 515; Savage v. Berry, -3 111. 545; Wade v. Bunn, 84 111. 117; Mitchell v. Shortt, 113 111. 251, 1 N. E. 909; Albrecht v. Lumber Co., 126 Ind. 318, 26 N. E. 157 (in which case it was held that a court of equity has juris- diction to decree a foreclosure of a mechanic's lien, and, where It has acquired a rightful Jurisdiction for one purpose, it retains it for all legitimate purposes, and will render a money judgment where It is an incident of a decree against specific property); Rickle v. Dow, 39 Mich. 91; Chase v. Boughton, 93 Mich. 285, 54 N. W. 44; Ostrander v. Weber, 114 N. Y. 95, 21 N. E. 112; Oliver v. Pray, 4 Ohio, 175, 19 Am. Dec. 595; Rison v. Moon, 91 Va. 384, 22 S. E. 165. a Parker v. Dee, 2 Ch. Gas. 200. 40 GENERAL PRINCIPLES GOVERNING. (Ch. 2 jurisdiction has been acquired, it will be retained until the whole cause is determined, and all questions, both legal and equitable, relating to the subject-matter of the controversy, have been decided.* To such an extent has this rule been carried that it has been declared that, if the controversy con- tains any equitable feature, or requires any purely equitable relief belonging to the exclusive jurisdiction of equity, or pertaining to the concurrent jurisdiction of equity and law, and a court of equity thus acquires a partial cognizance of the action, it may go on to a complete adjudication, and es- tablish purely legal rights, and grant legal remedies, which would otherwise be beyond the scope of its authority.* When, therefore, a court of equity assumes jurisdiction to restrain a continuous trespass in order to prevent a multi- plicity of suits, it may proceed to give full relief, both foi the tortious act and the resulting damages. 6 Having acquired jurisdiction, the court cannot be devested thereof because it appears that adequate relief may be reached by a merely per- sonal judgment." Where, in an equitable action, relief is sought of a purely equitable nature, and, as incident thereto, an award of damages is asked, a court of equity will proceed to dispose of the whole matter, and render a judgment for damages. 1 Cathcart v. Robinson, 5 Pet 264, 8 L. Ed. 120; Tyler v. Savage, 143 U. S. 79, 97, 12 Sup. Ct 340, 36 L. Ed. 82; Gormly v. Clark. 1;J4 U. S. 338, 349, 10 Sup. Ct. 554, 33 L. Ed. 909; Milkman v. On! way. 106 Mass. 232; Combs v. Scott, 76 Wis. 662, 671, 45 N. W. 532; Pool v. Docker, 92 111. 501; McMurray v. Van Gilder, 56 Iowa, <;<>.->. !> N. W. 903. While It is not within the province of a court of equity to remove a cloud from title when complainant is not in possfs- sion, yet, when other distinct grounds of jurisdiction are averred, the court, having assumed Jurisdiction for one purpose, will retain it, that the whole litigation may be settled, and complete Justice done between the parties. Shipman v. Furniss, 69 Ala. 555, 44 Aiu. Dec. 528. McGean v. Railway Co., 133 N. T. 9, 30 N. E. 647. Lynch v. Railway Co., 129 N. Y. 274, 29 N. E. 315. Van Rensselaer v. Van Rensselaer, 113 N. Y. 207, 214, 21 N. E. 75. TWIswnll v. McGown. 2 Barb. (N. Y.) 270; White T. Fratt, 13 Cal. 521; Burdell v. Comstock (C. C.) 15 Fed. 395. Damages may be recovered In a suit to enjoin a nuisance, Fnrris v. Dudley, 78 Ala. 124, 50 Am. Eep. 24; Fleischner T. Investment Co., 25 Or. 119. 11) ACQUISITION AT LAW OF SIMILAR JURISDICTION. 41 EFFECT OF ACQUISITION BY COURTS OP LAW OF A JURISDICTION SIMILAR TO THAT OF EQUITY. 11. When courts of equity inherently possess power to grant relief in certain cases under certain circumstances, their jurisdiction is not lost, abridged, or affected because courts of law, by judicial interpretation or legisla- tive enactment, have acquired a jurisdiction to grant relief in the same kind of cases and under the same facts and circumstances. There are many cases where courts of law have abandoned the arbitrary rules which formerly restrained them in the ex- ercise of their judicial powers. Common-law actions have been widened in their scope and effect, so that now courts of law may grant adequate and complete relief which could formerly be afforded by courts of equity alone. As an ex- ample, equity assumed jurisdiction of actions on lost bonds and sealed instruments, because courts of law refused to aid the plaintiff, who could not produce the instrument. The rule was changed by courts of law permitting the plaintiff to declare on a lost bond. But Lord Thurlon held the jurisdic- tion of equity over this class of cases was not thereby di- verted; 1 and Lord Eldon some years later said: "Phis court will not suffer itself to be ousted of any part of its origi- 35 Pac. 174; so also in a suit to restrain waste, Lefforge v. West, 2 Ind. 514; and to prevent a trespass for prior injuries, Winslow v. Nayson, 113 Mass. 411. In an action to reform a contract, damages may be awarded for a breach thereof. Bidwell v. Insurance Co., 16 N. Y. 263. Equity may award a money judgment where such relief is connected with a transaction over which the court has juris- diction, although, for the purpose of collecting damages only, equity would not have Jurisdiction. Carpenter v. Osborne, 102 N. Y. 552, 7 N. B. 823. 11. i Atkinson v. Leonard, 3 Brown, C. O. 218, 224. See, to the same effect, Toulmin v. Price, 5 Ves. 235, 238; Bromley v. Hol- land, 7 Ves. 3; East India Co. v. Boddam, 9 Yea. 464, 466; Reeves T. Morgan, 48 N. J. Eq. 429, 21 Atl. 1040. 42 GENERAL PRINCIPLES GOVERNING. (Ch. 2 nal jurisdiction because a court of law happens to fall in love with the same or a similar jurisdiction." 2 There are a num- ber of like instances where courts of law have assumed a jurisdiction similar to that exercised by courts of equity, but which has not resulted in ousting equity of its jurisdiction. Among these are the powers now generally possessed by courts of law to enforce the recovery of a fund impressed with a trust ; * the granting of relief in cases involving fraud, mistake, or accident ; * actions brought by sureties against co-sureties upon an implied contract, which relief would be afforded in equity by suits for exoneration or contribution. 6 Where the powers of law courts have been enlarged by legislative enactment, the jurisdiction of equity is not af- fected, unless by an express provision, or by a fair and rea- sonable construction of the statute, it is apparent that it was the legislative intent to abrogate or abridge such juris- diction.* While, in principle, the jurisdiction of equity will remain regardless of the enlargement of the remedies afford- ed by the common law, the jurisdiction may nevertheless become obsolete, and be practically abolished, because un- used. Numerous instances of such effect are mentioned elsewhere in this chapter. 1 AUXILIARY JURISDICTION OF EQUITY. 12. The auxiliary jurisdiction of equity had its origin in the failure of the common law to (a) Permit the examination of either party as a witness, and provide for the discovery and Eyre v. Everett, 2 RUBS. 381, 382. Varet v. Insurance Co., 7 Paige (N. Y.) 560; New York Ins. Co v. Roulet, 24 Wend. (N. Y.) 505; Kirkpatrtck v. McDonald, 11 Pa. 887, 3U2. People v. Houghtallng, 7 Cal. 348, 351; Boyce's Ex'rs v. Grundy, 8 Pet. 210, 215, 7 L. Ed. 655; Babcock v. McCamant, 53 111. 214, 217. Sailly v. Elmore, 2 Paige (N. Y.) 497, 499. Atkinson v. Leonard, 3 Brown, C. C. 218, 224. Force v. City of Ellznlu'th. '-'7 N. J. Eq. 408; Darst v. Phillips, 41 Ohio St 514; Howell v. Moores, 127 111. G7, 19 N. E. Ante, p. 20. 12) AUXILIARY JURISDICTION OF EQUITY. 43 inspection of books and documents in pos- session of either party. (b) Provide for the taking of testimony by com- mission before trial, or before the com- mencement of an action. The auxiliary jurisdiction has reference entirely to the procedure employed for the enforcement of rights and reme- dies. It is not proposed in this place to discuss at length the exercise of this jurisdiction. Bills of discovery, 1 bills to perpetuate testimony, 2 and the examination of witnesses de bene esse, 3 will be considered in another part of this work. It is only desirable here to mention the so-called "auxiliary jurisdiction" of equity as one of the divisions of the subject formerly considered by text-book writers and judges. Be- ing entirely a matter of procedure, it has been more affected by modern legislation than either the exclusive or concur- rent equity jurisdictions. The English supreme court judi- cature act of 1873 seems to have effectually abrogated bills of discovery, bills to perpetuate testimony, and the equitable procedure for the examination of witnesses de bene esse; and the same may be said as to the effect of statutes enacted in most of the American states adopting the reformed pro- cedure. 12. i Post, p. 630. 2 post, p. 636. s Post, p. 637. 44 MAXIMS. (Ch. 3 CHAPTER HL MAXIMS. 13. No Wrong without a Remedy. 14. Equity Follows the Law. 15. Equity Aids the Vigilant 16. Equality is Equity. 17. Equal Equities, the Law Must Prevail. 18. Equal Equities, First in Order of Time Must Prevail 19. He Who Seeks Equity Must Do Equity. 20. He Who Comes into Equity Must Come with Clean Hands. 21. Equity Looks on That as Done Which Ought to be Done. 22. Equity Looks to the Intent Rather than to the Form. 23. Equity Imputes an Intent to Fulfill an Obligation. 24. Equity Acts In Personam. 25. Equity Acts Specifically and not by Way of Compensation. NO WRONG WITHOUT A REMEDY. 13. Equity -will not suffer a wrong to be without a remedy. (*'Ubi jus, ibi remedium.") QUALIFICATION Equity will not interfere where the wrong is not within the scope of judicial action. In so far as equity jurisdiction had its rise in the defects of the common law, the above maxim may be said to lie at the foundation of that jurisdiction. The maxim is, there- fore, of great importance, and has had great influence upon the growth and development of equity jurisprudence. From it arose the exclusive, the concurrent, and the auxiliary juris- diction of courts of equity, since by its application courts of equity assumed control of matters not cognizable by courts of law, applied remedies where legal remedies were lacking, inadequate, or incomplete, and aided courts of law in the administration of justice through channels not available to such courts. Whenever a statute or a constitution creates a new right, especially if it be equitable in its nature, and provides no method for its enforcement, equity will afford 13) NO WRONG WITHOUT A REMEDY. 45 relief. 1 Thus equity will enforce a statutory lien where the statute itself provides no method of enforcement ; 2 and a provision of the interstate commerce act prohibiting dis- crimination against connecting carriers was enforced by mandatory injunction against employes of a discriminating road, who had declared a boycott against the connecting car- rier, and who had refused to handle its freight. 3 In the last case the rule was stated as follows: "It is said the orders issued in this case are without precedent. Every just order or rule known to equity courts was born of. some emergency, to meet some new condition, and was, therefore, in its time, without a precedent. If based on sound principles, and 13. i Whenever the legislature creates new rights in parties, for the enforcement and protection of which rights the common law affords no effectual remedy, and the statute itself does not prescribe the mode in which such rights are to be protected, a court of equity, in the exercise of its acknowledged jurisdiction, is bound to give to a party the relief to which he is equitably enti- tled under the statute. Innes v. Lansing, 7 Paige (N. Y.) 583. See, also, Gibson v. Supervisors, 80 Gal. 359, 363, 22 Pac. 225. One excep- tion to this principle is in cases of contested elections, based on the theory that these are political matters, with which courts of equity have no power to deal. Parmeter v. Bourne, 8 Wash. 45, 35 Pac. 586, 757; Dickey v. Reed, 78 111. 262; State v. Police Jury, 41 La. Ann. 850, 6 South. 777; Skrlne v. Jackson, 73 Ga. 377; Sanders v. Metcalf, 1 Tenn. Ch. 419; McWhirter v. Brainard, 5 Or. 426. But, under circumstances involving a question as to the location of county seats and the legality of elections held for a change thereof, the jurisdiction of courts of equity has been up- held, although it necessitated a determination of the question of such legality. Boren v. Smith, 47 111. 482; Sweatt v. Faville, 23 Iowa, 321. 2 Gilchrist v. Railroad Co. (C. C.) 58 Fed. 708; Lockett v. Robin- eon (Fla.) 12 South. 649. 3 Toledo, A. A. & N. M. R. Co. v. Pennsylvania Co. (a C.) 54 Fed. 746, IB L. R. A. 395; Southern California R. Co. v. Ruther- ford (C. C.) 62 Fed. 796. It should be noted, however, that the interstate commerce law expressly authorizes the federal courts to prevent and restrain its violation. U. S. v. Elliott (C. C.) 62 Fed. 801. The mere fact that a case is novel, and Is not brought plainly within the limits of some adjudged case, does not defeat the juris- diction of equity. Piper v. Hoard, 107 N. Y. 73, 13 N. E. 626, 1 Am. St. Rep. 789. See, also, Joy v. City of St. Louis, 138 U. S. 1, 11 Sup. Ct. 243, 34 L. Ed. 843; Britton v. Supreme Council, 46 N. J. Eq. 102, 38 Atl. 675, 19 Am. St Rep. 376; Wickersham v. Critten- den, 93 Cal. 32, 28 Pac. 788. 46 MAXIMS. (Ch. 3 beneficent results follow their enforcement, affording nec- essary relief to one party without imposing illegal burdens on the others, new remedies and unprecedented orders are not unwelcome aids to the chancellor to meet the constantly varying demands for equitable relief." While this maxim is frequently applied in dealing with newly-created rights and duties, before its principle should be invoked careful exam- ination should be made to see if an efficient and adequate remedy does not already exist. 4 Wrong Must Be within Scope of Judicial Action. Equity does not take upon itself to enforce every moral right, such as gratitude, hospitality, the sanctity of domestic relations, etc. The maxim must be understood as referring to rights which come within a class enforceable at law, or capable of being judicially enforced, and the enforcement of which would not occasion a greater detriment or inconven- ience to the public than would result from leaving them to be disposed of in foro conscientiae. 5 Equity cannot assume control over that large class of obligations called "imper- fect obligations," resting upon conscience and moral duty only, unconnected with legal obligations.* The total failure In Hadden v. Spader, 20 Johns. (N. Y.) 554, Justice Woodworth said: "It would be a matter of surprise, as well as regret. If, in a system of jurisprudence that has been matured by the wisdom of ages, adequate remedies were not provided for the violation of every important civil right Although this consideration will have no influence in deciding on a case where the power of the court to redress an alleged wrong Is drawn in question, It may, neverthe- less, be useful in calling for the most careful and strict examination before the point is conceded that there is no efficient remedy." Snell, Kq. p. 17; Smith, Eq. p. 12, citing Day v. Brownrigg, 10 Ch. Div. 294; AJello v. Worsley [1898] 1 Ch. Div. 274. Equity has left many matters of natural Justice wholly unprovided for from the difficulty of framing any general rules to meet them, and from the doubtful nature of the policy of attempting to give a legal sanction to duties of Imperfect obligations, such as charity, grati- tude, and kindness, or even to positive engagements of parties, where they are not founded In what constitutes a meritorious con- sideration. Story, Eq. Jur. 2. Rees v. City of Watertown, 19 Wall 107, 22 L. Ed. 72. See, also. In re Hoffner's Estate, 161 Pa. 331, 344, 29 Atl. 33; Heine v. Commissioners, 19 Wall. 658, 22 L. Ed. 223; Finuegan v. Fernan- dlna, 15 Fla. 379, 21 Am. Rep. 292. 14) EQUITY FOLLOWS THE LAW. 47 of ordinary remedies does not confer on the court of chan- cery an unlimited power to give relief. Such relief as is consistent with the general law of the land, and authorized by the principles and practice of the courts of equity, will, under such circumstances, be administered. But the hard- ship of the case, and the failure of the mode of procedure established by law, are not sufficient to justify a court of equity in departing from all precedent, and assuming an unregulated power of administering abstract justice at the expense of well-settled principle. 7 The maxim, therefore, does not apply to real wrongs which are not remediable, either at law or in equity, nor to apparent wrongs which are not wrongs at all, except in the imagination of the suitor. EQUITY FOLLOWS THE LAW. 14. Equity follows the law. ("2Equitas sequitur legem.") This maxim is to be applied in two classes of cases: (a) Where legal rights are considered in a court of equity, the general rules and policy of the law must be obeyed. (b) Where equitable estates and interests are con- sidered, the court generally applies the same rules as are applied to similar legal estates and interests at common law. This maxim is narrow in its scope, and really does not amount to a general principle, though commonly considered i Mr. Justice Miller, in Heine v. Commissioners, 19 Wall. 655, 22 L. Ed. 223. In accordance with this principle, it has also been held that the nonexistence of any method at common law for sub- jecting a debtor's choses in action to the payment of a judgment does not authorize a resort to equity, in the absence of a fraud, trust, or other ground of equitable relief, or of a statute conferring Jurisdiction. Donovan v. Finn, 1 Hopk. Ch. (N. Y.) 59, 74, 14 Am. Dec. 351, followed in Greene v. Keene, 14 R. I. 388, 395, 51 Am. Rep. 400, where authorities are collected. Contra, Hadden T. Spader, 20 Johns. (N. Y.) 554, 562. 48 MAXIMS. (Ch. 3 as such. The great mass of equity jurisprudence has been created by an open disregard of the law. Many equitable estates arose in contravention of law, and equitable rules have been applied thereto, which, for the most part, are contradictory to corresponding legal rules of the most posi- tive and mandatory character. Indeed, the whole theory of the development of the equity jurisdiction has been in oppo- sition to the principle that equity follows the law. 1 It may be said that the maxim in its strict literal sense is not of sufficient scope to permit of its universal use and application. Where a rule, either of the common or the statute law, is di- rect and applicable, a court of equity is as much bound by it as a court of common law. But equity will only follow the law so far as it can without sacrificing claims grounded on peculiar circumstances, which render it incumbent on a court of equity to interpose in accordance with the maxim previously mentioned that equity will not suffer a wrong to be without a remedy. The meaning of the principle that, where legal interests are involved, a court of equity must follow the general rules and policy of the law, is clearly expressed by Lord Chancellor Talbot, who says: "There are instances, indeed, in which a court of equity gives a rem- edy where the law gives none ; but, where a particular rem- edy is given by the law, and that remedy is bounded and cir- cumscribed by particular rules, it would be very improper for this court to take it up where the law leaves it, and to extend it further than the law allows." a And, where legal rights i 14. i The maxim Is, In truth, operative only within a very nar- row range. To raise it to the position of a general principle would be a palpable error. Throughout the great mass of its Jurispru- dence, equity, instead of following the law, either ignores or open- ly disregards and opposes the law. One large division of equity Jurisprudence lies completely outside of the law. It is additional to the law. And while it leaves the law concerning the same sub- ject-matter in full force and efficacy, its doctrines and rules are constructed without any reference to the corresponding doctrines and rules of the law. 1 Pom. Eq. Jur. 427. * Heard v. Stanford. Cas. Talb. 173. In this case the court re- fused to compel the husband to pay the wife's debts after her death, in consequence of his having acquired a fortune from her, Blnce the failure of the creditors to bring action against the bus- 14) EQUITY FOLLOWS THE LAW. 49 and remedies are clearly defined and established by law, equity has no power to change or unsettle those rights and remedies. In dealing with legal rights, courts of equity adopt and apply legal rules whenever they are applicable. 8 For instance, if a contract executed by a municipality is void at law for want of power to make it, a court of equity has no jurisdiction to enforce it, or, in the absence of fraud, acci- dent, or mistake, to so modify it as to make it legal, and then enforce it.* And judgment liens, and the rights of par- ties thereunder, are legal in their nature, but courts of equity will recognize and enforce the lien, and protect the rights of the parties in the same manner as courts of law. 6 And with respect to legal estates it is well settled that equity follows the law relating to the canons of descent. The rule of primogeniture, productive as it is of the greatest hardship towards the younger members of a family by leaving them without any sort of provision, while the eldest son may be in affluence, has been followed by courts of equity in coun- tries where that rule exists. And where the circumstances are such as to be sufficient to create an equity, a court of eq- uity will not violate or disregard a rule of law, since it has no power and no discretion in the matter ; but, while recog- nizing the rule of law, and even maintaining it, a court of equity will, in a proper case, find a way to avoid or obviate it. 6 This has been instanced in a case where a testator in band during the lifetime of the wife debarred, at law, the recovery of a judgment against him. Magniac v. Thomson, 15 How. 281, 14 L. Ed. 696; Mathews v. Insurance Co., 75 Ala. 85. * Hedges v. Dixon Co., 150 U. B. 182, 192, 14 Sup. Ct 71, 37 L. Ed. 1044. 6 Lawson v. Jordan, 19 Ark. 305, 70 Am. Dec. 596; Hamilton Trust Co. v.-demes, 17 App. Div. 152, 155, 45 N. Y. Supp. 141. Snell, Eq. (10th Ed.) p. 18, where, as an illustration, it is also stated: "For example, if an eldest son should prevent his father from executing a proposed will devising one estate to a younger brother by promising to convey such estate to such younger broth- er, and that estate should accordingly descend at law to the eldest son as a consequence flowing from his promise, which was the cause, a court of equity would interpose, and say: 'True it is, you (the eldest son) have the estate at law; in other words, the legal estate. That we don't deny or interfere with. But, precisely be- cause you have it, you will make a convenient trustee of it for EATON, EQ. 4 50 MAXIMS. (Ch. 3 advanced years induced his niece to reside with him as a housekeeper and nurse on the verbal representation that he had provided for her in his will, which he had in fact pre- pared and executed. After his death it appeared that the provision had been revoked by a codicil. The court directed that the trusts of the will in the niece's favor should be per- formed, and held that in such cases a representation that property is given, even though by a revocable instrument, is binding, where the person to whom the representation is made has acted on the faith of it to his or her detriment; and that it is the law of the court, grounded on such detri- ment, that makes it binding. Such a ruling, it will be ob- served, does not set aside, but avoids, the law. The com- plete legal grant made by the will was left to subsist unaf- fected, but to subsist subject to the contract in favor of the niece, on the ground that the testator had already during his lifetime, and to the extent of that contract, fettered his own otherwise free power of devise. 1 But the representa- tion must result in a contractual obligation; a mere repre- sentation of an intention not amounting to a promise is insufficient.* The second method of applying the maxim has been stated as follows : Equity is regulated by the analogy of legal in- terests and rights, and the rules of the law affecting the same, in regard to equitable estates, interests, and rights, where any such analogy clearly subsists.' Equity, having created equitable estates and interests, has determined that there should be applied thereto, to a certain extent, the rules pertaining to corresponding legal estates and interests. 10 your younger brother, who, In our opinion, Is equitably entitled to It, because, but for your promise, he would have had It.' " See the following English cases: Loffus v. Maw, 3 GIff. 592; Coverdale v. Eastwood, L. R. 15 Eq. 121 ; Coles v. Pllklngton, L. R. 19 Eq. 174; In re Applebee 11S91] 3 Ch. Dlv. 422. Maddlson v. Alderson, 8 App. Cas. 467; Hammersley v. De Blel (En p. i 12 Clark & F. 45. Suell. Eq. 14. o The following extract from a decision by Sir Joseph Jekyll In Cowper v. Cowper, 2 P. Wms. 720, clearly elucidates this prin- ciple: "The law Is clear, and courts of equity ought to follow It in their judgments concerning titles to equitable estates; other- wise, great uncertainty and confusion would ensue. And though 14) EQUITY FOLLOWS THE LAW. 51 Thus words of limitation used in the creation of executed trusts will be given the same construction and effect as if used in creating legal estates. 11 And the rules governing the admissibility and weight of evidence and the construction of contracts are the same at law and in equity. 12 It may be also stated generally that proceedings in equity must be brought within the period prescribed by statutes of limita- proceedings In equity are said to be 'secundum dlscretionem boni viri,' yet when is asked, 'Vlr bonus est quis?' the answer Is, 'Qui consulta patrum, qul leges juraque servat.' And as Is said In Book's Case, 5 Coke, 99b, that discretion Is a science not to act arbitrarily according to men's wills and prhate affections; so the discretion which is executed here is to be governed by the rules of law and equity, which are not to oppose, but each in its turn to be subservient to, the other. This discretion in some cases follows the law implicitly; in others assists it, and advances the remedy; In others again, it relieves against the abuse, or allays the rigour, of It; but in no case does it contradict or overturn the grounds or principles thereof, as has been sometimes ignorantly imputed to this court That is a discretionary power, which this nor any other court, not even the highest, acting in a judicial capacity, Is, by the constitution, intrusted with." 11 Dibrell v. Carlisle, 48 Miss. 691. n In re Terry & White's Contract, 32 Ch. Div. 21. In this case Lord Esher said: "I doubt myself * * * whether there are any principles of law which were differently affirmed in the old court of equity and the old courts of common law. These courts dealt with the same matters for the purpose of different remedies, and therefore were necessarily looking at the same matters from dif- ferent points of view. But It has been often said that the rules of evidence in the court of equity were different from those in the courts of common law, and that a different construction was put upon the same instrument; that the same instruments in the same words would be construed in one way in a court of equity and in another way in a court of common law; and it has been said that that which in the one court would have been deemed to be neither Immoral or drshonest was in the other court deemed to be both im- moral and dishonest. Ever since I have been in this court of ap- peal I have been trying to point out, not the differences, but the resemblances and the identities, between law and equity; and I now protest against each and every one of those alleged doctrines. I protest most strongly that evidence was always the same ia the court of equity as in the courts of common law as to its effect in finding out the truth. What an absurdity it would be if the same evidence to prove a given fact before one of two tribunals should be taken to prove it, and before the other tribunal should be taken not to prove itl The idea seems to me to be monstrous; and, as to 52 MAXIMS. (Ch. 3 tions for the bringing of similar legal proceedings. 1 ' This rule is not without qualification. A court of equity, in the exercise of its concurrent jurisdiction, will never either ex- ceed or abridge the limit of time prescribed at law; but in the exericse of its exclusive jurisdiction it will, through rea- sons of its own, such as laches, etc., abridge, although per- haps never exceed, the limit thus prescribed. 1 * EQUITY AIDS THE VIGILANT. 15. Equity aids the vigilant, not the indolent. ('Vigilantibus non dormientibus sequitas subvenit.") But legal disabilities, such as infancy, incom- petency, and absence from the state, excuse delay; and the sovereign power is not chargeable with laches in respect to public rights and interests. a matter being called Immoral and dishonest In one court and moral and honest in another, if the law were so, I should consider it perfectly hateful that a man should be branded with fraud or with dishonesty according to the court in which his adversary brought the suit. It seems to me to be equally absurd and ridicu- lous to suppose that the same words, in the same contract, should be held to have one meaning in a court of law, and another in a court of equity." i Boone Co. v. Railroad Co., 139 TJ. S. 693, 11 Sup. Ct 687, 35 L. Ed. 319; Bickel's Appeal, 86 Pa, 204; Hollingshead v. Webster, 87 Ch. Div. 659. i Snell, Eq. p. 20; Fullwood v. Fullwood, 9 Cb. Div. 176; God- den v. Klmmell, 99 TJ. S. 201, 25 L. Ed. 431; Manning v. Warren, 17 111. 267; Richardson v. Gregory, 126 111. 166, 18 N. E. 777; McCrea T. Purmort, 16 Wend. 460, 30 Am. Dec. 103. The existence of spe- cial circumstances may relieve the suitor of the operation of the statute, Preston v. Preston, 95 U. S. 200, 24 L. Ed. 494; Meath v. Phillips Co., 108 U. S. 553, 2 Sup. Ct. 869, 27 L. Ed. 819; Williamson v. Monroe (C. C.) 101 Fed. 322; Kirkpatrick v. Atkinson, 11 Rich. Eq. (S. C.) 27. A shorter time than that prescribed by the statute may suffice to prevent the court giving relief. Kirksey v. Keith, 11 Rich. Kq. (S. C.) 33. In the absence of fraud, equity adopts the period of the statute. Church T. Winton, 196 Fu. 107, 46 All. 363. 15) EQUITY AIDS THE VIGILANT. 53 A court of equity, which is never active in relief against conscience or public convenience, has always refused its aid to stale demands, where the party has slept on his rights, and acquiesced for a great length of time. 1 A court of eq- uity will not aid the slothful. A claim worthy of support in that court must be asserted in a reasonable time, or equita- ble relief will be refused. This maxim is applied to pro- mote diligence on the part of suitors, to discourage laches by making it a bar to relief, and to prevent the enforcement of stale demands of all kinds, wholly independent of any statutory periods of limitation. 2 The rule is peculiarly appli- cable where the difficulty of doing entire justice arises through the death of the principal participants in the trans- action complained of, or of the witness or witnesses, or by reason of the original transactions having become so ob- scured by time as to render the facts impossible of ascertain- ment. 8 Effect of Statutes of Limitations. Courts of equity, in cases of concurrent jurisdiction, con- sider themselves bound by the statutes of limitation which govern courts of law in like cases, and this rather in obedi- ence to the statutes than by analogy, because, where the legal remedy is barred, the spirit of the statute bars the equi- 1 15. i Lord Camden, In Smith v. Clay, 2 Ambl. 645, cited and approved In Oalhoun v. Millard, 121 N. Y. 69, 81, 24 N. E. 27, 8 L. R. A. 248, where It was said: "It Is, and always has been, the prac- tice of courts of equity to remain Inactive where a party seeking their interference has been guilty of unreasonable laches In mak- ing his application." Speidel v. Henrlci, 120 U. S. 387, 7 Sup. Ct 610, 612, 30 L. Ed. 718. 2 Pom. Eq. Jur. 418. Equity can only help the diligent The principle laid down by Lord Camden more than a century ago is Btill the guide of the court in cases where the party seeking its aid has been guilty of great delay. Norfolk & N. B. Hosiery Co. v. Arnold, 49 N. J. Eq. 397, 23 Atl. 514. s Harrison v. Gibson, 23 Grat. (Va.) 212; Lawrence v. Rokes, 61 Me. 38; Hatcher v. Hall, 77 Va. 578; Barnes v. Taylor, 27 N. J. Eq. 259. Laches may apply where, from the lapse of time, the death of the parties, the destruction of records, and the loss of papers, there can be no longer a safe determination of the matters in controversy. Kelson's Adm'r v. Kownslar's Ex'r, 79 Va. 468; Perkins v. Lane, 82 Va. 59; Mathiaa v. O'Neil, 94 Alo. 520, 6 S. W. 253. 54 MAXIMS. (Ch. 3 table remedy also. 4 In many other cases they act upon the analogy of the like limitation at law. But there is a defense peculiar to courts of equity, founded on lapse of time and the staleness of the claim, where no statute of limitation governs the case. 8 In such cases courts of equity act upon their own inherent doctrine of discouraging, for the peace of society, antiquated demands, and refuse to interfere where there has been gross laches in prosecuting the claim, or long acquiescence in the assertion of adverse rights. Long acquiescence by parties out of possession of real property is productive of much hardship and injustice to others, and cannot be excused save by showing some actual hindrance or impediment, caused by the fraud or concealment of the par- ties in possession, which will appeal to the conscience of the chancellor.* What Constitutes Laches. What delay in bringing suit will constitute such laches as will bar relief, in the absence of the defense of the statute of limitations, depends upon the facts and circumstances of each particular case, and is within the sound discretion of the court to determine. 7 Lapse of time is only one of the many Richardson v. Gregory, 126 111. 160, 18 N. E. 777, 780, citing Hancock v. Harper, 8 111. 445; Qunyle v. Guild. 91 111. 378; Bon- ney v. Stoughton, 122 111. 541, 13 N. E. 833; Calboun v. Millard, 121 N. Y. 69, 81, 24 N. B. 27, 8 L. R. A. 248; Holmes v. Railroad Co. (D. C.) 93 Fed. 100. In re Neilley, 95 N. Y. 382, 390; Groenendyke v. Coffeen. 109 111. 329; Stout v. Seabrook's Ex'rs, 30 N. J. Eq. 189, 190; Bell v. Hudson. 73 Gal. 285, 14 Pac. 791. 2 Am. St. Rep. 791. In McKnight v. Taylor, 1 How. 168, 11 L. Ed. 88, the court said: "We do not found our Judgment on the presumption of payment, for it is not merely on presumption of payment, or in analogy to the statute of limitations, that a court of chancery refuses to lend Its aid to stale demands. There must be conscience, good faith, and rea- sonable diligence to call Into action the powers of the court." Badger v. Badger, 2 Wall. 94, 17 L. Ed. 836; Richards v. Mack- all, 124 U. S. 183. 8 Sup. Ct. 438, 31 L. Ed. 396; Speidel v. Henrici, 120 U. 8. 877, 7 Sup. Ct 610, 30 L. Ed. 718; Hayward v. Bank. 96 U. S. 617, 24 L. Ed. 855; Hammond v. Hopkins, 143 U. S. 224, 12 Sup. Ct. 418, 36 L. Ed. 134; Castner y. Walrod, 83 111. 171, 25 Am. Rep. 369; Catlin v. Green, 120 N. Y. 441, 24 N. E. 941; Melma v. Brewing Co., 93 WIs. 153, 60 N. W. 518, 57 Am. St. Rep. 899. t Gibson T. Herriott, 55 Ark. 85, 17 8. W. 589, 29 Am. St. Rep. 17, 15) EQUITY AIDS THE VIGILANT. 55 circumstances from which the conclusion of laches must be drawn, and each case must be determined in the light of the particular facts shown.* And while the principal founda- tions of the doctrine of laches are lapse of time and acqui- escence, other circumstances will be taken into consider- ation. Thus it is a material circumstance that the claim was not made until after the death of those who could have explained the transaction. 9 It has been held that a change in the value and character of the property may be material. 10 And, where a suit was brought by the heirs of a deceased partner for an accounting, it was held that a delay of 16 years constituted laches, and rendered the claim stale. 11 Where the parties are in confidential or fiduciary relation- ship with each other, the delay may not be so material as in where the court held that the delay of a party holding the equitable title to land In standing by and permitting the owner of the legal title to expend large sums In Improving and developing the prop- erty until it has largely increased in value, without notice of his claim, constitutes such laches as will bar relief. See, also, Brown v. Wilson, 21 Colo. 309, 40 Pac. 688, 52 Am. St. Rep. 288; Bryan v. Kales, 134 U. S. 126, 135, 10 Sup. Ct 435, 33 L. Ed. 829; Mc- Quiddy v. Ware, 20 Wall. 19, 22 L. Ed. 311; Carpenter v. Canal Co., 35 Ohio St. 307. In enforcing purely equitable remedies, de- pending on general equitable principles, unreasonable and inex- cusable delay is an element in the plaintiff's case which a court of equity always takes into consideration in exercising its discretion to grant or refuse relief, and is not a mere collateral incident. Calhoun v. Millard, 121 N. Y. 69, 83, 24 N. E. 27, 8 L. R. A. 248. s Reynolds v. Sumner, 126 111. 58, 18 N. E. 334, 9 Am. St Rep. 523, citing Boone v. Chiles, 10 Pet. 177, 9 L. Ed. 388; Michoud v. Girod, 4 How. 503, 11 L. Ed. 1076; Baker v. Read, 18 Beav. 398; Prevost v. Gratz, 6 Wheat 481, 5 L. Ed. 311; Paschall v. Hinderer, 28 Ohio St. 568, 580; Brown v. County of Buena Vista, 95 U. S. 159, 24 L. Ed. 422. Bell v.' Hudson, 73 Cal. 285, 14 Pac. 791, 2 Am. St. Rep. 791; Mooers v. White, 6 Johns. Ch. (N. Y.) 360; Barnes v. Taylor, 27 N. J. Eq. 259; German- American Seminary v. Keifer, 43 Mich, 111, 4 N. W. 636. 10 Bliss v. Prichard, 67 Mo. 187; Allen v. Allen, 47 Mich. 79, 10 N. W. 113; Pratt v. Mining Co. (C. C.) 24 Fed. 869; Twin-Lick Oil Co. v. Marbury, 91 U. S. 587, 23 L. Ed. 328. 11 Groenendyke v. Coffeen, 109 111. 339. And see Codman v. Rog- ers, 10 Pick. 119; Harris v. Hillegass, 66 Cal. 79, 4 Pac. 987; Curtis V. Lakln, 94 Fed. 251, 36 C. C. A. 222. 56 MAXIMS. (Ch. 3 other cases; and, where the parties are members of the same family, the delay is not so prejudicial. 1 * In cases where it is sought to impeach a transaction because of fraud, lapse of time is a question of much importance, owing to the fact that much evidence originally available and necessary to a full knowledge of the equities of the transaction may be lost. 1 * But the lapse of time in such cases begins to run only from the time of the discovery of the fraud. 14 This is so since where there has been no knowledge there can be no acquiescence or laches. The rule may be stated thus: In equity cases time does not commence to run unless there is full information and knowledge by a party of his righ'ts and the injury done, or he has such notice thereof that he ought to have made inquiry, or where there is undue influence, and the disability is removed, or where he himself possesses the means of knowledge. 1 * To constitute laches, there must have been actual or imputable knowledge of the facts which should have prompted a choice either to diligently seek relief, or thereafter to be content with such remedies as a court of law might afford ; or, if there was actual ignorance, that must have been without just excuse. 1 * it Note 4 to Crowe v. Ballard, 1 Ves. Jr. (Stunner's Ed.) 215, cit- ing Beaumont v. Eoultbee, 5 Ves. 492, 494; Hardwlcke v. Vernon, 14 Ves. 511; Macdonald v. Macdonald, 1 Bligb, 336; Lewes v. Mor- gan, 5 Price, 42; Berkmeyer v. Killerman, 32 Ohio St. 257, 30 Am. Rep. 577. is I'revost v. Gratz, 6 Wheat 481, 498, 5 L. Ed. 311; Thomas v. Van Meter, 164 111. 304, 45 N. B. 405. i Longworth v. Hunt, 11 Ohio St. 194; Meader v. Norton, 11 Wall. 442, 20 L. Ed. 184; Charter v. Trevelyan, 11 Clark & F. 714, 740, where relief was granted when the fraud was discovered after a l:i]>se of 37 years. il Sugd. Vend. (8th Am. Ed.. Perkln's Notes) 387. And see Morouy v. O'Dea, 1 Ball & B. 118; Ferris v. Henderson, 12 Pa. 49, 61 Am. Dec. 580; Hellman v. Davis, 24 Neb. 793, 40 N. W. 309; Parker v. Kuhn, 21 Neb. 413, 32 N. W. 74. A person is not guilty of laches, so as to deprive him of relief, by waiting three years after discovery of a mistake In an agreement before he begins an action to correct the same. Thompson v. Marshall, 36 Ala. 504, 76 Am. Dec. 328. Bausman v. Kelley. 38 Minn. 197. 36 N. W. 333, 8 Am. St Rep. 661, 606, citing Stocking v. Hanson. 35 Minn. 207. 28 N. W. 607. 15) EQUITY AIDS THE VIGILANT. 57 When Laches Not Imputed. Where there has been a reasonable excuse for the delay, equity will not refuse its aid. As where, because of the obscurity of the transaction, a plaintiff was unable to obtain full information in regard to his rights, lapse of time may be excused. As long as a person remains under the duress or undue influences which induced him to execute the contract or perform the act from which he seeks relief, he will not be deemed to have acquiesced. It is only when the distressed party is relieved from the oppression which controlled in the first instance that he can be expected to act. 17 Since a person non sui juris cannot act in his own behalf, neither an infant, a married woman under the disability of coverture, nor an insane person is chargeable with laches. 18 And a suit by the government to enforce a public right or assert a public interest is not barred by the laches of its officers, however gross. 1 * T Note 4 to Crowe v. Ballard, 1 Ves. Jr. (Sumner's Ed.) 221, cit- ing Puvcell v. McNamara, 14 Ves. 10R, 121; Gowland v. De Faria, 17 Ves. 25; Aylward v. Kearney, 2 Ball & B. 477; Wood v. Downes, 18 Ves. 128. It was held in Roberts v. Tunstall, 4 Hare, 257, that the poverty of the cestuis que trustent was not sufficient to excuse delay in prosecuting his claim to relief. is McMillan v. Rushing, 80 Ala, 402; Wha?ey v. Eliot's Heirs, 1 A. K. Marsh. (Ky.) 345, 10 Am. Dec. 737; Blandford v. Marlbor- ough, 2 Atk. 545. As to married women under coverture, see Baker v. Morris' Adm'r, 10 Leigh (Va.) 284; Wilson v. McCarty, 55 Md. 277; Harrison v. Gibson, 23 Grat. (Va.) 212; Etting v. Marx's Ex'r (C. C.) 4 Hughes, 312, 4 Fed. 673; Bedilian v. Sea ton, 3 Wall. Jr. 279, 287, Fed. Cas. No. 1,218. As to insane persons, see Craig v. Leiper, 2 Yerg. (Tenn.) 193, 24 Am. Dec. 479; Dungan v. Insurance Co., 46 Md. 409, 499. i U. S. v. Insley, 130 U. S. 263, 9 Sup. Ct. 485, 32 L. Ed. 968; TJ. S. v. Beebe, 127 U. S. 338, 8 Sup. Ct 1083, 32 L. Ed. 121; Steele v. U. S., 113 U. S. 128, 5 Sup. Ct. 396, 28 L. Ed. 952. And see U. S. v. City of Alexandria (C. C.) 4 Hughes, 545, 19 Fed. 609; 22 Meyer, Fed. Dec. 327, where the court said: "The general principle is that laches are not imputable to the government. The utmost vig- ilance would not save the public from the most serious losses if the doctrine of laches could be applied to its transactions." And see, also, Haehnlen v. Com., 13 Pa. 617, 53 Am. Dec. 502, and note; U. S. v. Williams, 4 McLean, 567, Fed. Cas. No. 16,720; U. S. v. Kirkpatrick, 9 Wheat. 720, 6 L. Ed. 199; U. S. v. Van Zandt, 11 Wheat. 184, 6 L. Ed. 448; U. S. v. Barrowcliff, 3 Ben. 519, Fed. Cas. No. 14.528. 58 MAXIMS. (Ch. 3 EQUALITY IS EQUITY. 16. Equality is equity. This maxim is sometimes expressed thus: "Equity de- lightcth in equality." It is of wide and general application, and is the source of many important doctrines of equity ju- risprudence. By its application courts of equity will decree a pro rata distribution of the assets of a debtor among his creditors, without regard to legal priorities or preferences obtained by such creditors, if such assets are not sufficient to discharge all claims against the debtor, or the debtor is insolvent. This is in contravention of the ordinary legal rule that the creditor who first obtains judgment and execution against an insolvent debtor is entitled to full satisfaction of his judgment, although there is not sufficient property be- longing to the debtor to satisfy the claims of all his credit- ors. 1 Upon this maxim are built all our modern bankruptcy laws, for the main object gained by such laws is the fair and equitable distribution of the assets of an insolvent debtor. Receiverships are subjected to this principle, and the receiv- er, as an officer of a court of equity, will generally be requir- ed to distribute the funds in his hands pro rata among the just claimants thereto. 2 And, where the aid of equity has been once invoked to settle the affairs of an insolvent debtor, a creditor will not usually be permitted to obtain a prefer- ence, even in a court of law.' S 16. i The right to prefer creditors Is an Infirmity still remaining In the body of the common law. It Is contrary to the letter and spirit of the maxim that equality is equity. It Is condemned In all our state Insolvent laws. The federal bankrupt laws have never omitted to annex penalties to Its exercise. Butler Paper Co. v. Bobbins, 151 111. 632, 38 N. E. 153. 2 International Bank v. Sherman, 101 U. S. 403, 25 L. Ed. 866; Burnham v. Barth, 89 Wis. 362, 62 N. W. 96; Blum v. Van Vechten. 92 Wis. 378. 66 N. W. 507; Shepherd v. Guernsey, 9 Paige (N. Y.) 857. where it was held that the principle that equality among persons having a common right to payment out of a fund provided for the benefit of all is equity will not be departed from unless thero Is n clear Intent to that effect expressed in a statute, or an assignment based on it. In re Thompson, 10 App. Div. 40. 41 N. Y. Supp. 740; Rose- 16) EQUALITY IS EQUITY. 59 The maxim applies with equal force to a case where a sin- gle claim exists against several persons. The law permits the claimant to enforce his claim against any one of such persons, and did not, in former times, give the debtor who paid the claim the right of enforcing contribution from the others jointly liable, so that in the end the burden might be distrib- uted among all in just proportions. The modern law provides such right of reimbursement, but it was derived solely from equity jurisprudence. It was from the hardship imposed by this legal rule that the equitable doctrine of contribution arose, and courts of equity applied the principle that, when- ever a common liability rests upon several persons in favor of a single claimant, equity will enforce such liability upon all such persons of the same class. 4 As an example of the ap- plication of this maxim, a person, being one of a number of sureties, who pays the debt of the principal debtor, may secure from his co-sureties a pro rata contribution. 6 Anoth- er application of this maxim is in the case of joint purchases and mortgages. The common-law rule is in favor of con- stituting the ownership a joint tenancy, which will pass to the survivor on the death of the co-owner. Equity does not favor joint tenancy, and, whenever circumstances arise which are available, a court of equity will prevent the inci- dent of survivorship. 8 If the purchase price was paid by the boom v. Whittaker, 132 111. 81, 23 N. E. 339; Russell v. Bank, 139 111. 549, 29 N. E. 37, 17 L. R. A. 345; Breed v. Investment Co. (C. C.) 71 Fed. 903. * Anniston Loan & Trust Co. v. Ward, 108 Ala. 85, 18 South. 937; Trustees of Internal Improvement Fund v. Greenough, 105 U. S. 527, 26 L. Ed. 1157; Central Railroad & Banking Co. of Georgia v. Pettus, 113 U. S. 116, 5 Sup. Ct 387, 28 L. Ed. 915. 5 Hawker v. Moore, 40 W. Va. 49, 20 S. E. 848; Norton v. Coons, 6 N. Y. 33, where the court said: "The doctrine of contribution was first established and enforced in equity. It rested upon and resulted from the maxim that 'equality is equity.' This principle has been so long established that persons becoming bound as sure- ties for a principal debtor are regarded as acting under a contract Implied from the settled rules which regulate their liability to each other," citing Craythorne v. Swinburne, 14 Ves. 169. And see Wells v. Miller, 66 N. Y. 255. e In Lake v. Gibson, 1 Eq. Cas. Abr. 290, 1 White & T. Lead. Cas. Eq. 215, it was held that, where two or more purchase lands, and advance the purchase money in unequal shares, and this ap- 60 MAXIMS. (Ch. 3 co-owners in equal proportions, even in equity, the owner- ship was a joint tenancy, and the common-law rule of surviv- orship was applied. Where a mortgage was taken by two or more persons for money loaned in either equal or un- equal proportions, their estate, at law, is joint, and on the death of one the security would belong to the survivor. But in equity the interest of the mortgagees is in common, and on the death of one the survivor holds for the benefit of the personal representatives of the deceased mortgagee. 7 The statutes of the several states have abrogated the ne- cessity of applying this maxim to estates owned by two or more. It is now provided, generally, by statute, throughout all the states, that a conveyance of land to two or more gran- tees shall, unless a contrary intention is clearly expressed, create an ownership in common, and not a joint tenancy. At common law, where two or more persons bind them- selves to pay a sum of money, or to perform any other act, the obligation and liability are joint; and in case of the death of one of the obligors his obligation ceases, and his' estate cannot be subjected to the obligation, but the survivor must bear the entire burden. 8 But in equity the rule is dif- ferent. Upon the death of one of the obligors the liability does not remain upon the survivor alone. If the survivor is insolvent, or if the creditor has exhausted his legal remedy against the survivor, a suit in equity may be maintained against the personal representatives of the deceased debtor to secure payment out of his estate.* In England, and in pears on the deed itself, the mere circumstance of the Inequality of the sums advanced makes them In the nature of partners; and, however the legal estate may survive, yet the survivor will, in eq- uity, be considered as a trustee for the other, in proportion to the Bum advanced by him, and, of course, a trustee also for himself in proportion to his own original share. T Appleton v. Boyd, 7 Mass. 131, 134; Goodwin v. Richardson, 11 Mass. 469; Kinsley v. Abbott, 19 Me. 430, 434. Cairns v. O'Bleness, 40 Wis. 469; Jones v. Keep's Estate, 23 Wis. 45; Morehouse v. Ballou, 16 Barb. (N. Y.) 289. Voorhls y. Chllds' Ex'rs, 17 N. Y. 354; Pope v. Cole, 55 N. Y. 124, 14 Am. Rep. 198; Ilichter v. Poppenhausen, 42 N. Y. 373; Harbeck v. Pupin, 123 N. Y. 115. 25 N. B. 311; Hotopp v. Huber. 160 N. Y. 524, 532, 55 N. E. 206; Barlow v. Scott's Adm'rs, 12 Iowa, 17; EQUAL EQUITIES, THE LAW MUST PREVAIL. 61 some of the states, the creditor is permitted to sue the per- sonal representatives of the deceased debtor, without even attempting to exhaust legal remedies against the survivor. 10 But the rule in equity as above stated is subject to this ex- ception : If the joint obligor who died be a surety, not lia- ble for the debt irrespective of the joint obligation, his estate is absolutely discharged, both at law and in equity ; the sur- vivor only being liable. In such case, where the surety owed no debt outside and irrespective of the joint obligation, the contract is the measure and the limit of his obligation. He signs a joint contract, and incurs a joint liability, and no oth- er. Dying prior to his co-maker, the entire liability attaches to the survivor. 11 There are many other examples of the application of this maxim. It will not be necessary to specify more than those already mentioned. In the following chapters of this work many doctrines will be treated and principles discussed which are the result of the operation of this maxim in the administration of equitable remedies. EQUAL EQUITIES, THE LAW MUST PBEVAIL. 17. Where there is equal equity the law must pre- vail. In other words, if the defendant has a claim to the protection of equity equal to the claim of the plaintiff for its assistance, equity will not interpose, but will leave the matter as it stands. It is by an application of this maxim that a court of equity will refuse to interfere against a bona fide purchaser of the 63; May v. Hanson, 6 Cal. 642. But see Bostwlck v. McEvoy, 62 Cal. 496. 10 Wilkinson v. Henderson, 1 Mylne & K. 582; Braithwaite v. Britain, 1 Keen, 219; De Vaynes v. Ix 7 oble, 2 Russ. & M. 495; Free- man v. Stewart, 41 Miss. 138; Braxton v. State, 25 Ind. 82; Eaton v. Burns, 31 Ind. 390; Myers v. State, 47 Ind. 293, 297; Voris v. State, Id. 345, 349, 350; Bostwick v. McEvoy, 62 Cal. 496. 11 Getty v. Binsse, 49 N. Y. 385, 10 Am. Rep. 379; Wood v. Fisk, 63 N. Y. 245, 20 Am. Rep. 528. 62 MAXIMS. (Ch. 3 legal estate for a valuable consideration without notice of the adverse title, if the purchaser is himself in possession, or has purchased from an apparent owner in possession, pro- vided he avail himself of the defense at the proper time, and in the proper mode. If the bona fide purchaser secures a legal title in addition to his equitable title, even after no- tice of the adverse equitable title, a court of equity will not deprive him of his advantage, and his legal title will pre- vail. 1 This is apparent, since, the equities of the parties be- ing equal, and the bona fide purchaser having also a legal title, the refusal of a court of equity to interfere will enable him to assert his legal title in a court of law, where his ad- versary will not be able to set up his equitable title. And, according to the above maxim, a purchaser for a valuable consideration, without notice of a prior equitable right, ob- taining the legal estate at the time of his purchase, is enti- tled to priority in equity, as well as at law. 2 EQUAL EQUITIES, FIRST IN ORDER OP TIME MUST PREVAIL. 18. Where there are equal equities, the first in order of time shall prevail. ("Qui prior est tempore potior est jure.") Another, and more correct, form of stating the rule is: As between persons having only equitable interests, if their interests are in all other respects equal, priority in time gives the better equity. 1 f 17. Taylor v. Russell [1892] App. Cas. 244; Black wood y. Bank, L. R. 5 P. O. 92, 111; Crump v. Black, 6 Ired. Eq. (N. O.) 321, 51 Am. Dec. 422; Hoult v. Donahue, 21 W. Va. 294, 300; Car- lisle v. Jumper, 81 Ky. 282; McNary v. Southworth, 58 I1L 473; Carroll v. Johnston, 55 N. C. 120. 2 Basset v. Nosworthy, 2 White & T. Lead. Cas. Eq. p. 14, note, citing Pitcher v. Rawllns, 7 Ch. App. 259. 8 IS. i In the case of Rice v. Rice, 2 Drew. 73, an able equity Judge, In discussing this maxim, said; "What Is the rule of a court of equity for determining the preferences as between persons hav- ing adverse equitable Interests? The rule Is sometimes expressed in 18) EQUAL EQUITIES, FIRST MUST PREVAIL. 63 The true meaning of the rule is that in a contest between persons having only equitable interests priority of time is the ground of preference last resorted to ; that is, a court of equity will not prefer the one to the other, on the mere ground of priority of time, until it finds, upon an examina- tion of their relative merits, that there is no other sufficient ground of preference between them, or, in other words, that their equities are in all respects equal ; and that, if the one has on other grounds a better equity than the other, priority of time is immaterial. 2 When conflicting claims and this form, as between persons having only equitable interests: 'Qui prior est tempore, potior est jure.' This is an incorrect state- ment of the rule, for that proposition is far from being invariably true. In fact, not only is it not universally true as between per- sons having only equitable interests, but it is not universally true even where their equitable interests are of precisely the same nature, and in that respect precisely equal, as in the common case of two successive assignments for a valuable consideration of a rever- sionary interest in the names of trustees, where the second as- signee has given notice to the trustees, and the first has omitted it. Another form of stating the rule is this: As between persons hav- ing only equitable interests, if their equities are equal, 'qui prior est tempore, potior est jure.' This form of stating the rule Is not so obviously incorrect as the former. And yet even this enunci- ation of the rule, when accurately considered, seems to me to in- volve a contradiction; for when we talk of two persons having equal or unequal equities, in what sense do we use the term 'eq- uity.' For example, where we say that A. has a better equity than B., what is meant by that? It means only that, according to those principles of right and justice which a court of equity recognizes and acts upon, it prefers A. to B., and will Interfere to enforce the rights of A. as against B.; and therefore it Is impossible, strictly speaking, that two persons should have equal equities, except in a case in which a court of equity would altogether refuse to lend its assistance to either party as against the other. If the court will interfere to- enforce the right of one against the other on any ground whatever, say on the ground of priority of time, how can It be said that the equities of the two are equal? i. e., in other words, how can it be said that the one has no better right to call for the interference of a court of equity than the other? To lay down the rule with perfect accuracy, I think it should be stated in some such form as this: As between persons having only equi- table interests, if their interests are in all other respects equal, priority in time gives the better equity." 2 Rice v. Rice, 2 Drew. 73. In this case a grantor claimed a ven- dor's lien for purchase money on lauds, in the conveyance of which 64 MAXIMS. (Ch. 3 interests respecting the same subject-matter are equitable, and neither is accompanied by the legal estate, and neither possesses any special features which in equity would give it a preference over the others independent of the order of time, the maxim applies, and priority of claim is determined by priority of time. 8 As between unrecorded deeds and mortgages, the grantees and mortgagees take according to the dates of their securities ; * but, as against a voluntary conveyance, a subsequent purchaser for value, without no- tice, has the superior equity, and is entitled to priority. 8 Upon this maxim are based the equitable doctrines of prior- ities and notice, and the rights of bona fide purchasers for a valuable consideration. there was an acknowledgment of the receipt by him of the con- sideration, against the lien of a subsequent equitable mortgagee who loaned money to the grantee on the deposit of title deeds as security. The grantor claimed that his lien was prior in point of time, but the court held that the equitable mortgagee's equity was, In other respects, superior, on account of his being misled by the acknowledgment In the deed of the receipt of the consideration, and hence the rule as to priority of time did not apply. See, also, Spencer v. Clarke, 9 Ch. Div. 137; Newton v. Xewton, 6 L. R. Eq. 135, 140, 141; Berry v. Insurance Co., 2 Johns. Ch. (N. T.) 603; Muir v. Schenck, 8 Hill (N. Y.) 228, 38 Am. Dec. 633 (in this case two assignments of the same claim were made by a person to dif- ferent assignees, and it was held that the assignment first in point of time would be protected as between the assignees, though notice had not been given to the subsequent assignee or to the debtor; but, if the debtor pays the subsequent assignee without notice of the first assignment, he will be protected, and the first assignee cannot recover from him); Maguire v. Heraty, 163 Pa. 381, 30 Atl. 151; Neslln v. Wells, 104 U. 8. 428, 26 L. Ed. 802; Hume v. Dixon; 87 Ohio St 66. 1 Pom. Eq. Jur. ( 415, citing Brace v. Duchess of Marlborough, 2 P. Win. 491; Loveridge v. Cooper, 3 Russ. 30; Rowan v. Bank, 45 Vt 303; Edmondson v. Hays, 1 Tenn. 509. * Berry v. Insurance Co., 2 Johns. Ch. (N. Y.) 603; Grlmstone v. Carter, 3 Paige (N. Y.) 421, 24 Am. Dec. 230; Ingram v. Morgan, 4 Humph. (Tenn.) 66, 40 Am. Dec. 626; Heyder v. Association, 42 N. J. Eq. 403, 407, 408, 8 Atl. 810, 59 Am. Rep. 49. Robinson v. Cathcart, 2 Cranch, C. C. 590, Fed. Gas. No. 11,946. To illustrate an application of this maxim, the following language of an able equity Judge may be quoted (Phillips v. Phillips, 4 De Gex, F. & J. 208, 215, Lord Westbury): "I take It to be a clear proposition that every conveyance of an equitable Interest la an in- J9) HE WHO SEEKS EQUITY MUST DO EQUITY. 65 HE WHO SEEKS EQUITY MUST DO EQUITY. 19. He who seeks equity must do equity. A court of equity giving the plaintiff the re- lief to which he is entitled will do so only upon the terms of his submitting to give the de endant such corresponding rights, if any, as he may also be entitled to in re- spect to the same subject-matter. 1 This maxim and the maxims, "He who comes into equitj must come with clean hands," and "Equity aids the vigilant," illustrate the distinctive and governing principle of equity that nothing can call forth a court of equity into activity but conscience, good faith, and personal diligence. 2 Within the restrictions above prescribed, the maxim is of univer- sal application, and governs courts of equity in administer- ing all kinds of equitable relief, whenever necessary to do complete justice to all parties to a controversy. The true meaning of the maxim is that, to entitle a plaintiff to the aid of a court of equity, he must secure to the defendant the nocent conveyance; that Is to say, the grant of a person entitled merely in equity passes only that which he is Justly entitled to, and no more. If, therefore, a person seised of an equitable estate (the legal estate being outstanding) makes an assurance by way of mortgage, or grants an annuity, and afterwards conveys the whole estate to a purchaser, he can grant to the purchaser that which he has, viz. the estate subject to the mortgage or annuity, and no more. The subsequent grantee takes only that which is left in the grantor. Hence grantees and incumbrancers claiming in equity take and are ranked according to the dates of their securities, and the maxim ap'plies, 'Qui prior est tempore, potior est Jure.' The first grantee is potior; that is, potentior. He has a better and su- perior, because a prior, equity. The first grantee has a right to be paid first, and it is quite immaterial whether the subsequent incum- brancers. at the time when they took their securities and paid their money, had notice of the first Incumbrance or not." See, also, Cory v. Eyre, 1 De Gex, J. & S. 149, 167; Newton v. Newton, 6 L. R. Eq. 135, 140, 141. 19. i Hanson v. Keating, 4 Hare, 1, 4. 2 Snell, Eq. 40; Lord Camden, in Smith v. Clay, 3 Brown, Ch, 640, note. EATON, EQ. 5 66 MAXIMS. (Ch. 3 rights which are his according to the settled doctrines and principles of equity jurisprudence. But the plaintiff cannot be arbitrarily compelled to perform acts or secure rights to which the defendant is not equitably entitled. The rights which the plaintiff may be compelled to secure to the defend- ant must be connected with the subject-matter of the suit or controversy. Or, to state the doctrine more in detail, the rule is applied where the adverse equity to be secured or awarded to the defendant grows out of the very controversy before the court, or out of such transactions as the record shows to be a part of its history, or where it is so connected with the cause in litigation as to be presented in the plead- ings and proofs, with full opportunity afforded to the party thus recriminated to explain or refute the charges.* Application of Maxim. The rights or equities which the defendant, by invoking this maxim, may force the plaintiff to secure, are not nec- essarily those which the defendant might enforce by a sepa- rate equitable proceeding. 4 This has not been universally declared to be the rule, for it has been asserted, in applying this maxim, that a plaintiff will never, in that character, be compelled to give a defendant anything but what the defend- ant might, as a plaintiff, enforce in a suit brought by him. 8 But this proposition has not been generally followed, and * Comstock v. Johnson, 46 N. Y. 615, citing Trlpp v. Cook, 26 Wend. (N. Y.) 143; McDonald v. Neilson, 2 Cow. (N. Y.) 190. 14 Am. Dec. 431; Casler v. Shlpman, 35 N. Y. 533; Mahoney v. Bost- wick, 96 Cal. 53, 30 Pac. 1020, 31 Am. St Rep. 175. And see Finch v. Finch, 10 Ohio St 501, 507, where It Is said that the principle does not apply "unless the mutual equities supposed by the maxim arise out of the subject-matter of the suit, and are such as have a foundation In established rules of law or of equity; the maxim In- vests courts of equity with no arbitrary discretion." And see Be- thea v. Bethea (Ala.) 22 South. 561. * Sturgis v. Champneys, 5 Mylne & C. 102; Comstock v. John- on, 4G N. Y. 615, where Chief Justice Church said: "It is not indis- pensable to the application of this rule that the fault of the plain- tiff should be of such a character as to authorize an Independent ac- tion for an injunction against him." And see Charleston & W. O. Ry. Co. v. Hughes, 105 Ga. 1. 30 S. B. 972, 70 Am. St Rep. 17. * Hanson v. Keating, 4 Hare, 1, 4, citing Elibank v. Montolleu, 5 Yes. 737, and Sturgls v. Champneys, 5 Mylne & a 102. 19) HE WHO SEKKS EQUITY MUST DO EQUITY. 67 the weight of authority seems to be in favor of the rule as first stated. For example, a court of equity recognized the common-law rule that the wife's property became that of her husband, and denied her any direct remedy against the claims of her husband or his creditors. But, if the husband or his creditors sought the aid of a court of equity to secure control or possession of the wife's property, the court would compel the plaintiff, under certain circumstances, as a con- dition of his obtaining relief, to set apart a sufficient portion of the property to provide for the comfortable support of the wife.' This application of the maxim is not now of practical importance, since in England, and in nearly, if not all, of the states, statutes have abolished the husband's common-law rights in his wife's property. And, again, statutes have de- clared usurious debts and obligations to be void, but have provided that debtors may maintain a suit in equity to set aside or cancel the usurious contract. But this relief will only be granted on condition that the plaintiff repay his creditor the amount due on the contract. Thus the defend- ant secures a remedy which he could not have secured had he sued the debtor at law or in equity, for in such a suit the defense of usury would be a complete bar. T This maxim is also applied to all suits in a court of equity brought by an obligor to be relieved from an illegal obligation, where the Smith v. Kane, 2 Paige (N. Y.) 303; Short v. Moore, 10 Vt. 446, 451; Tucker v. Andrews, 13 Me. 124, 128; Gardner v. Hooper, 3 Gray (Mass.) 398; Page v. Estes, 19 Pick. (Mass.) 269, 271; How- ard v. Moffatt, 2 Johns. Ch. (N. Y.) 206, 208; Haviland v. Bloom, 6 Johns. Ch. (N. Y.) 178, 180; Glen v. Fisher, 6 Johns. Ch. (N. Y.) 83, 36. i Williams v. Fitzhugh, 37 N. Y. 444, 453, where it is said that a person might stand on his legal rights, and defend any and every endeavor to compel him to pay a usurious loan, but, if he invoked the aid of a court of equity to give him affirmative relief, that court recognized his equitable obligation to refund what he had received, citing Rogers v. Rathbun, 1 Johns. Ch. (N. Y.) 367; Tup- per v. Powell, Id. 439; Fanning v. Dunham, 5 Johns. Ch. (N. Y.) 122, 137, 9 Am. Dec. 283; Morgan v. Schemerhorn, 1 Paige (N. Y.) 544, 19 Am. Dec. 449. And see Noble v. Walker. 32 Ala. 456; Corby v. Bean, 44 Mo. 379; Whateley v. Barker, 79 Ga. 790, 4 S. B. 387. In New York the statute does not require the payment of the usurious loan before setting aside the security. Tuthill v. Morris, 81 N. Y. 4, 100. 68 MAXIMS. (Ch. 3 obligor has received a valuable consideration. In such a case equity will not aid the obligor unless he returns to the obligee the amount or makes restitution for the benefits which he has received under the illegal contract. 8 In a suit in equity to restrain the collection of an illegal assessment, the court will not grant the injunction unless the plaintiff first tenders the lawful tax or assessment.* Another instance of the application of this maxim, which is frequently cited, is where a contract for the sale of land was made when the currency of the country was gold. Lat- er, when the value of the land had greatly increased, and after the passage of the legal-tender act in 1864, the pur- chaser offered payment in United States legal-tender notes, which the vendor refused. In an action to enforce specific performance of the contract, the supreme court held that the plaintiff was not entitled to relief unless the payment was made in gold. 10 And one who comes into equity to have a void judicial sale of his land set aside as a cloud on his title must do equity by tendering what is justly due on the debt for which the sale was made. 11 If the owner of an estate stands by f and permits a person who is ignorant of his title to improve the estate, and spend money thereon, a court of equity, upon being asked to establish the owner's title, will require him to indemnify the person making such expendi- ture. 1 * And if a purchaser of land at an illegal partition sale Mtimford v. Trust Co., 4 N. Y. 463, 483; Deans v. Robertson, 64 Miss. 195, 1 South. 159; Tuthlll v. Morris, 81 N. Y. 94, 100; Good- enow v. Curtis, 33 Mich. 505. See, also, Dranga v. Rowe, 127 Cal. 506, 59 Pac. 944; Interocean Pub. Co. v. Associated Press (111. Sup.) 56 -N. E. 822; German Nat Bank of Hastings v. Bank, 59 Neb. 7, 80 N. W. 49. Board of Cora'rs of Montgomery Co. v. Elston, 32 Ind. 27, 2 Am. Rep. 327; Merrill v. Humphrey, 24 Mich. 170; Dean v. Charl- ton, 23 Wls. 590, 99 Am. Dec. 205; Hart v. Smith, 44 Wls. 213. 10 Wlllard v. Tayloe, 8 Wall. 557, 19 L. Ed. 501. And see, also. McGoon v. Shirk, 54 111. 408, 5 Am. Rep. 122; Wales v. Coffin, 105 Mass. 328. " McQulddy v. Ware, 20 Wall. 14, 20, 22 L. Ed. 311; Loney T. Courtnay, 24 Neb. 580. 39 N. W. 616; Blackburn v. Clarke, 85 Tenn. 506. 8 S. W. 505. " Miner v. Bookman, 50 N. Y. 337; Powell v. Thomas, 6 Hare, 800; Craven* v. Moore, 61 Mo. 178. 20) MUST COME INTO EQUITY WITH CLEAN HANDS. 69 has paid taxes on the land in the belief that he is the bona fide owner, the claimants seeking to set aside the sale will be required to refund such taxes as a condition of the relief sought by them. 18 It is the application of this maxim that gave rise to the equitable doctrine of estoppel, and has had its influence upon the origin and development of many other equitable principles and doctrines, such as election, marshal- ing assets, etc. HE WHO COMES INTO EQUITY MUST COME WITH CLEAN HANDS. 20. He who conies into equity must come with clean hands. (a) The maxim must be understood to refer to willful misconduct in regard to the matter in litigation, and not to any misconduct, however gross, -which is unconnected with the matter in litigation, and with which the opposite party in the cause has no con- cern. 1 (b) Though both parties have been engaged in a fraudulent or illegal transaction, equitable i Chambers v. Jones, 72 111. 275. Among other cases where the maxim has been applied are the following: A beneficiary cannot set aside a sale. by his trustee, and recover back the property, and yet retain the consideration. Fears v. Lynch, 28 Ga. 249. One cannot obtain the abatement of a nuisance on his neighbor's land If he maintains one equally offensive on his own premises. Cas- sady v. Cavenor, 37 Iowa, 300. A party cannot ask for a partial release of premises from a past-due incumbrance in accordance with the terms of the trust deed, while he refuses to pay what Is due from him under the provisions of the same deed. Lane v. Allen, 60 111. App. 457. A deed of trust cannot be canceled unless the complainant has performed his own equitable obligations. Jones v. Langhorne, 3 Bibb (Ky.) 453. A stockholder must pay legal assessments on his stock before be can complain of the company and its incorporators. Yard v. Insurance Co., 10 N. J. Eq. 480, 64 Am. Dec. 467. 20. * Snell, Eq. p. 42; Smith, Eq. 20. 70 MAXIMS. (Ch. 3 relief -will be granted the plaintiff if public policy is advanced thereby, and he -was not in pari delicto -with the defendant. 8 This maxim, or, as it is otherwise expressed, "He that hath committed iniquity shall not have equity," is the equita- ble application of a fundamental principle pervading the en- tire body of the law, that no one shall be permitted to prof- it by his own fraud, or take advantage of his own wrong, or to found any claim on his own iniquity, or to acquire proper- ty by his own crime.* This maxim, while of the same nature as the one preceding, "He who seeks equity must do equity," has many distinctive characteristics. The preceding maxim does not assume that the plaintiff has done a wrong to the defendant, nor does it refuse him relief; but it grants him the remedy sought on condition that he secures to the de- fendant the rights to which he is equitably entitled. But this maxim refuses the plaintiff the relief he seeks when it appears that he has been guilty of conduct towards the de- fendant in respect to the subject-matter of the controversy, which, measured by the principles of equity, is unconscion- able and unrighteous. "It says that whenever a party, who, as actor, seeks to set the judicial machinery in motion and obtain some remedy, has violated conscience, or good faith, or other equitable principle, in his prior conduct, then the Pom. Eq. Jur. 403; Adams, Eq. 175; Tied. Eq. Jur. | 16. Riggs v. Palmer, 115 N. Y. 506, 22 N. E. 188, 5 L. R. A. 340. In this case it was held that a beneficiary under a. will, who mur- dered the testator to prevent a revocation and to obtain a speedy en- joyment of the property, will not be permitted to take either under the will or as heir or next of kin, though there is no law declaring a forfeiture; approving New York Mut. Life Ins. Co. v. Armstrong, 117 U. S. 591, 6 Sup. Ct. 877, 29 L. Ed. 997, holding that the bene- ficiary under a policy of life insurance who murders the insured cannot recover on the policy, and disapproving Owens v. Owens, 100 N. C. 240, 6 S. E. 794, holding that a woman who murders her husband may claim dower in his land. In Shellenberger v. Ran- som (Neb.) B9 N. W. 935, 10 L. R. A. 810, the doctrine of Rlggs v. Palmer Is rejected, and it is held that a murder perpetrated for the purpose of inheriting the estate of the murdered person will not Jus- tify a court in adding an exception to the statute of descent, so as to devest the murderer of the fruits of his crime, 20) MUST COME INTO EQUITY WITH CLEAN HANDS. 71 doors of the court will be shut against him in limine. The court will refuse to interfere on his behalf, to acknowledge his right, or to award him any remedy." 4 The maxim means that a court of equity will not lend its active aid to one who has been guilty of unconscientious or oppressive conduct, or who has been in equal wrong with the defend- ant touching the transaction as to which the relief is sought ; but in such cases the court will leave the parties where it finds them, without interfering in behalf of either. 1 Limitations. ^ The maxim is wide in its scope, and of general applica- tion, but it is limited in its use to such acts on the part of the plaintiff as relate to the subject-matter of the controver- sy, and affect the rights of the parties. The court will not go outside of the case to examine the conduct of the plain- tiff in other matters, or to question his character for fair dealing. 6 For instance, a contract obligation will be en- forced, although it is indirectly connected with an illegal transaction, if it is supported by an independent consider- ation, and the alleged rights of the plaintiff are not depend- ent on the illegal transaction. 7 And a violation of a statute * Pom. Eq. Jur. 397. B Kahn v. Walton, 46 Ohio St. 195, 20 N. E. 203; Atwood v. Fisk, 101 Mass. 363, 100 Am. Dec. 124; Harrington v. Bigelow, 11 Paige (N. Y.) 349; Weakley v. Watkins, 7 Humph. (Tenn.) 356; Bleakley's Appeal, 66 Pa. 187; Creath v. Sims, 5 How. 192, 12 L. Ed. Ill; Longinette v. Shelton (Tenn. Ch. App.) 52 S. W. 1078; Liverpool, London & Globe Ins. Co. v. Clunie (C. C.) 88 Fed. 160. o Bering v. Earl of Winchelsea, 1 Cox, 318; Lewis' Appeal, 67 Pa. 166, where the court said: "It is not every unfounded claim which a man may make, or unfounded defense which he may set up, which will bar him from proceeding in a court of equity. The rule that he who comes into equity must come with clean hands must be understood to refer to willful misconduct in regard to the matter in litigation." And see, also, Langdon v. Templeton, 66 Vt 173, 28 Atl. 806; Edison Electric Light Co. v. Electric Co., 3 C. C. A. 605, 53 Fed. 592. The maxim does not apply to miscon- duct, however gross, which is unconnected with the matter in suit. Mossier v. Jacob, 66 111. App. 571; Equitable Gaslight Co. v. Man- ufacturing Co., 65 Md. 73, 3 Atl. 108. And see Upchurch v. Ander- son (Tenn. Ch. App.) 52 S. W. 917; City of Chicago v. Transit Co., 164 111. 224, 45 N. E. 430, 35 L. R. A. 281. T Armstrong v. Bank, 133 U. S. 469, 10 Sup. Ct 450, 33 L. Ed. 747. n MAXIMS. (Ch. 3 with respect to platting land within city limits does not pre- vent the owner from resorting to equity to enjoin the flood- ing of the property by a private person ; * nor will fraud in obtaining a patent of public lands from the federal gov- ernment prevent the reformation of a deed, whereby one of the participants in the fraud, for an independent valuable consideration, conveys his interest in the land to his con- federate." So, also, the fact that the parties have been en- gaged in illegal transactions, which have been fully com- pleted, will not prevent one of them from resorting to equity for relief as to subsequent independent collateral contracts or transactions, in which the original illegal transaction forms no part of the consideration. 10 Another limitation in the application of this maxim has been stated thus : Where the parties to a contract which is against public policy or illegal are not in pari delicto, and where public policy is considered as advanced by allowing either, or at least the more excusable, to sue for relief against the transaction, relief is given to him. 11 Or, as it Sylvester v. Jerome, 19 Colo. 128, 34 Pac. 700. Foster v. Winchester, 92 Ala. 497, 9 South. 83. 10 Armstrong v. Toler, 11 Wheat 258, 271, 6 L. Ed. 468; Tenant T. Elliott, 1 Bos. & P. 3; Thomson v. Thomson, 7 Yes. 470; Sharp v. Taylor, 2 Phil. Ch. 801. In Sykes v. Beadou, 11 Ch. Div. 170, 193, 194, Jessel, M. R., says: "You cannot ask the aid of a court of equity to carry out an Illegal contract; but in cases where the contract Is actually at an end, or is put an end to, the court will interfere to prevent those who have, under the illegal contract, obtained money belonging to other persons, on representation that the contract was legal, from keeping that money. * * * It does not follow that you cannot, In some cases, recover money paid over to third persons in pursuance of the contract; and it does not fol- low that you cannot, In other cases, obtain, even from the parties to the contract, moneys which they have become possessed of by representations that the contract was legal, and which belong to the persons who wish to recover them." 11 Reynell v. Sprye, 1 De Gex, M. & G. 060, 679. In the case of Tracy v. Talmage, 14 N. Y. 162, 181, Judge Selden baa discussed this rule, and cited a number of cases relative thereto. He says (at page 181): "The maxim, 'Ex dolo malo non oritur actio,' is qualified by another, viz., 'In par! delicto mellor est conditio de- fendentis.' Unless, therefore, the parties are In pari delicto, as well as pnrrlceps crirninls, the courts, although the contract be Ille- gal, will afford relief, where equity requires it, to the more Innocent 20) MUST COME INTO EQUITY WITH CLEAN HANDS. 73 has also been expressed, when the parties are not equally guilty, or when the public interest is advanced by allowing the more excusable of the two to sue for relief, the courts will aid the injured party by setting aside the contract, and restoring him, so far as possible, to his original position. 12 Upon the application of this doctrine it has been held that usurious interest paid by a borrower might be recovered in- dependently of the statute, and that the maxim, "Inter par- tes in pari delicto potior est conditio defendentis," did not apply, as the law considered the borrower the victim of the usurer; and where statutes protecting one set of men from another set of men prohibit certain transactions, the parties thereto are not in pari delicto. 18 Many cases have been de- cided to the effect that a plaintiff might be relieved from a usurious contract, all of which appear to be on the theory that the law was enacted to prevent oppression, and that public policy will be advanced by assisting the oppressed party who is not in pari delicto. 14 Finally, it may be stated that two parties may often concur in an illegal act without being in all respects in pari delicto. In many such cases re- lief from thz contract will be afforded to the less guilty party when he appears to have acted under circumstances of im- position, hardship, or undue influence, and especially where there is necessity of supporting public interest, or a well-set- tled policy of the law, whether that policy be declared in the statutes of the state, or be the outgrowth of the decisions of the courts. 15 party." See, also, White v. Bank, 22 Pick. (Mass.) 186; Lowell v. Railroad Corp., 23 Pick. (Mass.) 82, 34 Am. Dec. 33; Prescott V. Norris. 32 N. H. 101. 12 Duval v. Wellman, 124 N. Y. 156, 160, 26 N. B. 343. Wheaton 'v. Hibbard, 20 Johns. (N. Y.) 290, 11 Am. Dec. 284; Browning v. Morris, 2 Cowp. 790. i* Fanning v. Dunham, 5 Johns. Ch. (N. Y.) 122, 142-144; Peters v. Mortimer, 4 Edw. Ch. (N. Y.) 279. IB Duval v. Wellman, 124 N. Y. 156, 161. 26 N. E. 343; Smith v. Bruning, 2 Vern. 392; Goldsmith v. Bruning, 1 Eq. Cas. Abr. 89. In Ford v. Harrington, 16 N. Y. 285, it is held that, where confi- dential relations exist between the parties, as between an attor- ney and his client, and a conveyance is made to the attorney by his client to defraud the creditors of the client on the attorney's prom- ise that he will reconvey, although the transaction Is illegal, the at- 74 MAXIMS. (Ch. 3 Application of Maxim. The maxim applies not only to fraudulent and illegal transactions, but to any unrighteous, unconscientious, or op- pressive conduct by one seeking equitable interference in his own behalf. A court of equity will not decree the spe- cific performance of a contract unless it is strictly equitable, and free from trickery and deception on the part of the par- ty seeking such performance. 18 Even if the inequity of the plaintiff is insufficient to warrant the court in canceling the contract, yet the plaintiff may be refused its enforcement. And equity will refuse its aid in the enforcement of a con- tract where the plaintiff has practiced fraud on the defend- ant, and also where the plaintiff has been guilty of uncon- scionable conduct which does not amount to legal fraud. 17 If the plaintiff is guilty of fraud upon his adversary, he will not be given relief. This has been instanced where a minor, fraudulently concealing his age, obtained from his trustees a part of a sum of stock to which he was entitled on coming of age, and, when of age, a few months after, he applied for and received the residue of such stock. Afterwards a suit was instituted to compel the trustees to pay over again the portion of stock improperly paid during minority; but torney must reconvey to the client on the consideration price be- ing refunded to him; citing Story, Eq. Jur. 300; Osborne v. Wil- liams, 18 Ves. 379. The case of Ford v. Harrington has been fol- lowed in Herrick v. Lynch, 49 111. App. 657, affirmed In 150 111. 283, 87 N. E. 221. i Sherman v. Wright 49 N. Y. 227; Weise's Appeal, 72 Pa. 351; Snell v. Mitchell, 65 Me. 48, 50; Crane v. Decamp, 21 N. J. Eq. 414; Plummer v. Keppler, 26 N. J. Eq. 481; Phillips T. Stauch, 20 Mich. 369; Mississippi & M. R. Co. v. Cromwell. 91 U. S. 643, 23 L. Ed. 367. IT Marcy v. Dunlap, 5 Lans. (N. Y.) 365; Evroy v. Nicholas, 2 Eq. Cas. Abr. 488. For other instances where specific performance will be refused, see Fish v. Leser, 69 111. 394; Rutland Marble Co. v. Ripley, 10 Wall. 339, 356, 357, 19 L. Ed. 955; Seymour v. Delancey, 6 Johns. Ch. (N. Y.) 222 (where the court refused Its aid because of the Inadequacy of price mentioned In the contract, since it gave the contract a character of unreasonableness, inequality, and hard- ship) ; Quinn v. Roath, 37 Conn. 16, 24; Bruck v. Tucker, 42 Cal. 346; Smoot v. Rea. 19 Md. 398; Auter v. Miller, 18 Iowa, 405; Burke v. Seely, 46 Mo. 334. And see Raasch v. Raasch, 100 Wis. 400, 76 N. W. 591; Lawton v. Estea, 167 Mass. 181, 45 N. E. 90. 20) MUST COME INTO EQUITY WITH CLEAN HANDS. 75 the court held that the concealment of the age of the minor was a fraud on the trustees, and neither the minor nor his assignee could compel the trustees to pay against the stock paid during minority. 18 Any material misrepresentation in a trade-mark tending to deceive the public as to the place where the article marked is manufactured, or as to the ma- terials composing it, is a fraud on the public, and deprives the owner of the trade-mark of the right to relief for in- fringement in equity. 19 And a grantor in a conveyance exe- cuted to defraud creditors cannot maintain a suit in equity for its cancellation. 20 And, if the contract in fraud of cred- itors is executory, a court of equity will not interfere in fa- vor of either party to enforce its performance. 21 Equity is Overton v. Vanister, 3 Hare, 503. And see, also, Savage v. Foster, 9 Mod. 35; Nelson v. Stocker, 4 De Gex & J. 458, 464. i Prince Mfg. Co. v. Paint Co., 135 N. Y. 24, 31 N. E. 990, 17 L. R. A. 129; Joseph v. Macowsky, 96 Cal. 518, 31 Pac. 914, 19 L. R. A. 53; Manhattan Medicine Co. v. Wood, 108 U. S. 218, 2 Sup. Ct. 436, 27 L. Ed. 706; Palmer v. Harris, 60 Pa. 156; Kenney v. Gillet, 70 Md. 574, 17 Atl. 499. 20 Dent v. Ferguson, 132 U. S. 50, 10 Sup. Ct 13, 33 L. Ed. 242; Freeman v. Sedgwick, 6 Gill (Md.) 28, 46 Am. Dec. 650. But a debtor may abandon his fraudulent purpose, and maintain suit to compel a reconveyance for the benefit of his creditors. Carll v. Emery, 148 Mass. 32, 18 N. E. 574, 1 L. R. A. 618. It is a conclu- sive rule of law, with a few exceptions, that deeds, conveyances, contracts, and other transactions entered into in fraud of creditors are valid between the parties.' Jackson v. Cadwell, 1 Cow. (N. Y.) 622; Owen v. Dixon, 17 Conn. 496; Waterbury v. Westervelt, 9 N. Y. 598; Schenck v. Hart, 32 N. J. Eq. 774, 781; Osborne v. Moss, 7 Johns. (N. Y.) 161, 5 Am. Dec. 252, and note; Jackson v. Garnsey, 16 Johns. (N. Y.) 189, 192; Finley v. McConnell, 60 111. 259; Smith v. Grim, 26 Pa. 95, 65 Am. Dec. 400; Choteau v. Jones, 11 111. 300, 60 Am. Dec. 460, and note. And see cases cited in note to Whit- worth v. Thomas, 3 Am. St Rep. 727. 21 Nellls v. Clark, 20 Wend. (N. Y.) 24, where the court held that, while an executed contract in fraud of creditors might be valid as between the parties, an executory contract for the same purpose could not be enforced between the parties. Followed In Moseley v. Moseley, 15 N. Y. 334, 335. This rule was dissented from in Har- vey v. Varney, 98 Mass. 118, where it was held that it made no differ- ence whether the contract was executed or executory. The rule, as first stated, is followed in Walton v. Tusten, 49 Miss. 569, 576; Shank v. Simpson, 114 Pa. 208, 212, 6 Atl. 847; Winton v. Free- man, 102 Pa. 366, 369 (where the court said: "It is not the province 76 MAXIMS. (Ch. 3 will refuse relief to one who, in seeking its aid, discloses his own turpitude in the very contract on which his action de- pends. 22 And, where both parties have been engaged in a fraudulent transaction, neither is, in general, entitled to the aid of a court of equity as against the other, who has ob- tained the fruits of the crime; it matters not whether the transaction be merely prohibited by statute, or whether it is intrinsically immoral or vicious. 28 When one party, pursu- ant to a prior arrangement, has fraudulently secured prop- erty for the benefit of another, equity will not aid the fraudulent beneficiary by compelling a conveyance of such property to him. 24 And, pursuant to the principle of this maxim, equity will refuse its aid to any of the parties to a transaction which is in violation of a statute." And the of the law to help a rogue out of his tolls. The rule Is to leave the parties where It finds them, giving no relief and no countenance to illegal contracts"). And see Hukill v. Yoder, 189 Pa. 233, 42 Atl. 122. Kunkle's Appeal, 107 Pa. 368; Pringle v. Pringle, 59 Pa. 281, 286. 23 Harrington v. Blgelow, 11 Paige (N. T.) 349; Trustees of Gosh en Tp. v. Railroad Co., 12 Ohio St 624; Sample v. Barnes, 14 How. 70, 14 L. Ed. 330. Application of principle to gambling transactions, see Smith v. Kammerer, 152 Pa. 98, 25 Atl. 165; Kahn v. Walton, 46 Ohio St 195, 20 N. E. 203; Atwood v. Fisk, 101 Mass. 363, 100 Am. Dec. 124. And see Union Nat. Bank v. Hines, 177 111. 417, 53 N. E. 83. *< Johns v. Norris, 22 N. J. Eq. 102; Allen v. Berry, 50 Mo. 90; Mussel in an v. Kent, 33 Ind. 452; Hunt v. Rowland, 28 Iowa, 349; Walker v. Hill's Ex'rs, 22 N. J. Eq. 513. In the last case an exe- cution debtor, by a secret arrangement, procured a person to buy In property at an auction sale for the debtor's benefit In such a manner as to be fraudulent against the other creditors. The court refused to grant relief by compelling a conveyance by the purchaser to the execution debtor. See, also, Bleakley's Appeal, 66 Pa. 187. As wftere a number of persons conspiring contrary to statute to unlawfully advance the price of an article of food, the courts will not Intervene In favor of any one of the parties to give him redress for frauds perpetrated by another to his detriment in car- rying out the unlawful enterprise. Leonard v. Poole, 114 N. Y. 871. 21 N. E. 707, 4 L. R. A. 728. Similarly held where a company was formed for the consummation of an unlawful lottery scheme. Sykes v. Beadon, 11 Ch. Div. 170. The illegality of an agreement for the formation of an Illegal Industrial "trust" taints the whole contract, and therefore equity will leave the parties to the agree- 21) THAT AS DONE WHICH OUGHT TO BE DONE. 77 same may be said when the transaction is malum in se, as opposed to public policy and good morals. 2 * An action can- not be maintained to recover the profits of an illegal transac- tion where it is necessary, in order to sustain the action, to appeal to and depend upon the terms of an illegal agree- ment. 27 21. Equity looks on that as done which ought to be done. This maxim is of great practical importance. It is the foundation of many great equitable doctrines. Its appli- cation has given rise to many equitable estates, and its ef- fect will be seen in one form or another throughout the whole system of equity jurisprudence. It has been attempt- ed by some writers to limit the scope of this maxim to ex- press executory contracts, and to those dispositions of prop- erty, by grant or otherwise, which give rise to an equitable conversion. But the better opinion is that the maxim will find an effective application in every instance where an equi- table duty in respect to the subject-matter rests on one per- son in favor of another; "to every kind of case where an affirmative equitable duty to do some positive act devolves upon one party, and a corresponding equitable right is held by another." * The right to demand the performance of ment as It finds them, whether the agreement Is executed or par- tially performed. Unckles v. Colgate, 148 N. Y. 529, 43 N. E. 59. a 1 Pom. Eq. Jur. 402. T Gray v. Oxnard Bros. Co., 59 Hun (N. Y.) 387, 13 N. Y. Supp. 86, citing Keene v. Kent, 4 N. Y. St. Rep. 431; Woodworth v. Ben- nett, 43 N. Y. 273, 3 Am. Rep. 706. 21. il Pom. Eq. Jur. 364. Adams, Eq. (6th Am. Ed.) p. 295, says: "What ought to be done Is considered in equity as done; and Its meaning is that, whenever the holder of property Is sub- ject to an equity In respect of It, the court will, as between the par- ties to the equity, treat the subject-matter as if the equity had been worked out, and as Impressed with the character which It would then have borne. The simplest operation of this maxim is found In the rule that trusts and equities of redemption are treated as es- tates; but Its effect Is most obvious In the constructive change of property from real to personal estate, so as to introduce new laws of devolution and transfer." 78 MAXIMS. (Ch. 3 an equitable duty must exist; for equity regards as done only what "ought" to have been done, not what "might" have been done.* Application of Maxim. The most direct application of the maxim is where, by deed or will, it is directed that money be laid out in land, in which case the money is already treated as land in equity; and, conversely, where land is, by agreement, contracted, or, by will, directed, to be sold, it is considered and treated as money. 8 Thus arose the equitable doctrine of conversion, which will be discussed later. 4 The whole doctrine of equi- table mortgages is founded on this maxim. Where a party advances money to another on the faith of a verbal agree- ment by the latter to secure its payment by a mortgage on certain lands, which is never executed, or is executed in such an informal and defective manner as to fail in effectuating the purpose of its execution, equity will impress on the land intended to be mortgaged a lien in favor of the creditor who advanced the money, for the security and satisfaction of his debt. 6 And based on this maxim is the settled doctrine in Burgess v. Wheate, 1 W. Bl. 123, 129. Snell, Eq. p. 45. Nothing is better established than this prin- ciple that money directed to be employed In the purchase of land, and land directed to be sold and turned into money, are to be con- sidered as that species of property into which they are directed to be converted, and this in whatever manner the direction is given. Fletcher v. Ashburuer, 1 Brown, Ch. 497, cited In Craig v. Leslie, 3 Wheat 577, 4 L. Ed. 4GO. Post, c. 10. Sprague v. Cochran, 144 N. Y. 104, 112, 38 N. E. 1000. The court said: "In order to apply this maxim according to its true meaning, the court will treat the subject-matter, as to collateral consequences and Incidents, in the same manner as if the final acts contemplated by the parties had been executed exactly as they ought to have been, not as the parties might have executed them, always regarding the substance, and not the form, of the transac- tion." See, also, Payne v. Wilson, 74 N. Y. 348; Freeman v. Free- man, 43 N. Y. 34, 3 Am. Rep. 657; Smith v. Smith, 125 N. Y. 224, 26 N. E. 259; Daggett v. Rankln, 31 Cal. 321, 326 (where Cuney, C. J.. said: "Where a mortgage covenants to insure the premises for the benefit of the mortgagee, and the mortgagor or some other person procures insurance payable to the mortgagor without the knowledge of the mortgagee, and with no intent to perform the cove- 21) THAT AS DONE WHICH OUGHT TO BE DONE. 79 equity that the vendee in an executory contract for the sale of land is the equitable owner of the land, while the vendor has merely a lien for the purchase money; and, being thus in equity the owner, the vendee must suffer any loss which may happen, and is entitled to any benefit which may ac- crue, to the estate in the interim between the agreement and the conveyance. 8 In such cases, by the doctrine of equitable conversion having its root in the maxim under discussion, the vendee's interest under the contract is to be treated as real estate, while the vendor's interest is personal. 7 The ven- dor is regarded as trustee of the land for the benefit of the purchaser, and liable to account to him for the rents and profits ; and the purchaser will be treated as trustee of the purchase money, if not paid, and will be charged with inter- est thereon. 8 The entire doctrine of trusts, both express and constructive, may be said to rest on the principle that equity looks upon that as done which ought to have been done ; for in equity the right of the beneficiary to enjoy the profits of property, the legal title of which is vested in an- other, is fully protected and well preserved, while at law only the legal title of the trustee is recognized. 9 The equitable nant, yet equity, looking on that as done which ought to have been done, will treat the insurance as effected under the agreement, and will give the mortgagee his equitable lien accordingly"); Ames v. Richardson, 29 Minn. 330, 13 N. W. 137; Wheeler v. Insurance Co., 101 U. S. 439, 25 L. Ed. 1055; Cromwell v. Insurance Co., 44 N. Y. 42, 4 Am. Rep. 641. Paine v. Meller, 6 Ves. 349; Revell v. Hussey, 2 Ball & B. 287; Brewer v. Herbert, 30 Md. 301, 96 Am. Dec. 582; Haughwout v. Murphy, 22 N. J. Eq. 531; Moyer v. Hinman, 13 N. Y. 180. In such cases the vendor holds the legal estate as trustee for the purchasers. Thomson v. Smith, 63 N. Y. 301, 303; Crawford v. Bertholf, 1 N. J. Eq. 460; King v. Ruckman, 21 N. J. Eq. 599. i Thomson v. Smith, 63 N. Y. 301, 303; Moore v. Burrows, 34 Barb. (N. Y.) 176; Schroeppel v. Hopper, 40 Barb. (N. Y.) 425. Worrall v. Munn, 38 N. Y. 142. Where the vendor Is himself In the actual occupation of the premises, he Is himself charged with the value of the use and occupation. Robertson v. Skelton, 12 Beav. 260; Dyer v. Hargrave, 10 Ves. 506. 1 Pom. Eq. Jur. 875, where It is said: "The beneficiary may not have anything which the law requires as a 'title'; he may even be without any written evidence of his right; his proprietorship may rest wholly upon acts and words; but still he Is the equitable owner, because equity treats that as done which In good conscience 80 MAXIMS. (Cb. 3 estate is vested in the beneficiary, and he is. clothed with all the attributes of a true owner. Among other equitable estates which are affected by this important maxim is the mortgagor's equity of redemption. A mortgage vests in the mortgagee a legal estate, which, upon breach of the condition, becomes absolute. But equi- ty will nevertheless secure to the mortgagor a right to re- deem, and the mortgagee may be compelled to reconvey the property to the mortgagor. This equitable right of the mortgagor is deemed, in pursuance of the spirit of this maxim, an estate, and not a mere chose in action. The real, beneficial ownership of the land remains in the mortgagor, subject to the lien of the mortgagee for the payment of the amount secured by the mortgage. This maxim also applies to cases of fraud. Not only does equity look on things agreed or directed to be done as done, but, if parties have been prevented by fraud from doing cer- tain acts, equity will interfere, and treat the case as if the acts had been actually performed. 10 The principle, as thus applied, is that a person is not allowed to derive any ad- vantage from his wrongdoing, and that, in order to prevent this, a court of equity will treat him as having done that which ought to have been done. 11 But equity will not con- sider that as done which ought to have been done if to do so would injuriously affect third parties who have contracted with reference to what actually has been done. 12 Thus, eq- uity will not consider a transaction as a pledge when there ought to have been done." In this connection, see, also, McDon- ough v. O'Mcl. 113 Mass. 92; Fisher v. Fobs, 22 Mich. 454; Mitch- ell v. Read, 61 N. Y. 123, 19 Am. Rep. 252; Jones v. Van Doren, 130 U. S. U84, 9 Sup. Ct 685. 32 L. Ed. 1077; Gisborn v. Insurance Co., 142 U. 8. 326, 335, 12 Sup. Ct 277, 35 L. Ed. 1029. and the follow- ing English cases: Dyer v. Dyer, 2 Cox, Ch. 92; Id., 1 White & T. Lead. Cas. Eq. 203; Keech v. Saudford, 1 White & T. Lead. Gas. Eq. 48; Uurguenln v. Baseley, 14 Ves. 273; In re Adams & Kensington Vestry, 27 Ch. Dlv. 394; Id., Brett Lead. Cas. Mod. Eq. 13. 10 Story, Eq. Jur. 8 187; Moore v. Crawford, 130 U. 8. 122, 128, Sup. Ct. 447, 32 L. Ed. 878. And see Shlpman y. Lord (N. J. Err. & App.) 46 Atl. 1101. London, C. & D. R. Co. v. Railway Co., 40 Ch. Dlr. 100. "Vose v. Cowdrey, 49 N. Y. 336; Clabaugh T. Byerly, 7 Gill (Md.) 354, 48 Am. Dec. 575. 22) THE IMTENT RATHER THAN TO THE FORM. 81 is no delivery of the thing pledged, though the parties so intended, if credit has been given to the pledger by third persons which might not have been given if he had not re- mained in possession of the thing pledged. 13 Nor does the maxim apply in favor of strangers and volunteers, but only in favor of the parties to the transaction and their privies. 14 22. Equity looks to the intent rather than to the form. The principle of this maxim is of great practical import- ance, and affects to a greater or less extent the whole system of equity jurisprudence. Equity, at the outset, combated the harsh formalism of the common law. It attempted to relieve suitors from the evil consequences of blindly following the rigid forms required by courts of law, and at a very early time disregarded such forms, and examined into the sub- stance of contracts and the intent of parties. It early be- came its purpose to enforce the rights and duties of parties to a transaction in accordance with the real intent of such parties and the true purposes, objects, and consequences of such transaction. "Equity always seeks for the real intent under cover of whatever forms and appearances, and will give effect to such intent unless prevented by some positive and mandatory rule of law." * It would in no case permit the veil of form to hide the true effect or intention of the transaction. The rigid formality of the common law is not " Casey v. Cavaroc, 96 U. S. 467, 24 L. Ed. 779. i Snell, Eq. p. 10; Smith, Eq. (15th Ed.) p. 21; Chetwynd v. Morgan, 31 Ch. Div. 596; Redfield v. Parks, 132 U. S. 239, 247, 248, 10 Sup. Ct 83," 33 L. Ed. 327. It has also been held that this maxim does not apply to errors or omissions in the record of Judicial pro- ceedings. King v. French, 2 Sawy. 441, Fed. Cas. No. 7,793. S 22. il Pom. Eq. Jur. 378. Equity looks beyond the form of a transaction, and shapes its Judgment in such a way as to carry out the purposes of the parties to the agreement, and to protect either of them against any unconscionable advantage to be derived from the apparent form In which their transaction has taken place. Campbell v. Freeman, 99 Cal. 546, 34 Pac. 113. Equity looks through form to substance. Texas v. Hardenberg, 10 Wall. 89, 19 L. Ed. 839. EATON.EQ. 6 82 MAXIMS (Ch. 3 so apparent at the present time, and the consequent injustice has been greatly lessened. But this result has been brought about by the influence of this once exclusively equitable principle. With increasing liberality at common law, this maxim has become of universal application in all courts, of law as well as equity. This maxim should be collated with the one preceding. Justice Washington, in speaking of the doctrine of conver- sion, says : "The principle upon which the whole of this doc- trine is founded is that a court of equity, regarding the sub- stance, and not the mere forms and circumstances, of agree- ments and other instruments, considers things directed or. agreed to be done as having been actually performed, where nothing has intervened which ought to prevent a perform- ance. This qualification of the more concise and general rule that equity considers that to be done which is agreed to be done, will comprehend the cases which come under this head [conversion] of equity." 2 These two principles, acting jointly, have given rise to many of the distinctive features of equity jurisprudence. They are often applied in common, and the same reason that exists for the applica- tion of one may also exist for the application of the other. By the application of this maxim, courts of equity are en- abled to disregard strict legal technicalities, and to so mold their relief as to reach the real merits of the controversy. 8 In order to ascertain and carry out the intention of the par- ties to a transaction, such courts will look at their situation, and the attendant circumstances. 4 Equity will disregard * Craig v. Leslie, 3 Wheat 563, 578, 4 L. Ed. 460. Mr. Pomeroy has said (Eq. Jur. 378): "In fact, it is only by looking at the in- tent, rather than the form, that equity is able to treat that as done which in good conscience ought to be done. * * * The two principles act together, and aid each other, and it is by their univer- sality and truth that much of equity Jurisprudence which is pecul- iar and distinctive, in contrast with the law, has been developed." Craln v. Barnes, 1 Md. Ch. 151. * Frink v. Cole, 10 111. 339; Nixon's Heirs v. Carco's Heirs. 28 Miss. 414; Llvermore v. McNair, 34 N. J. Eq. 478; Lee T. Peck- ham, 17 Wls. 383. Where a claim is vested on the rights of a pur- chaser at a judicial sale, and It appears that he was only a nominal purchaser, and that the certificate of sale made to him was a mere ham, and used as a mere matter of form, equity will look through 22) THE INTENT RATHER THAN TO THE FORM. 83 names, and penetrate disguises, to get at the substance un- derneath. 6 Application of Maxim as Source of Doctrines. There are many important equitable doctrines which have their origin in the application of this maxim. A few of these may be profitably mentioned in this connection for the pur- pose of illustrating the use of the maxim. The equitable doctrine of forfeitures and penalties is based on this maxim. Where a contract provides for the payment of a stipulated sum of money, or, in default thereof, the payment of a greater sum as a penalty, courts of equity will grant relief by decreeing a payment of the amount due on the contract, with costs and interest, unless, of course, the defaulting par- ty has, by inequitable conduct, debarred himself from any relief in equity. 6 In such a case equity disregards the form of the contract, and gets at what must have been the intent of the parties, in the view of that other maxim that equity regards that as done which ought to have been done. And, where a forfeiture is imposed in a contract for the perform- ance of some act or service, in case of default a court of eq- uity will disregard the arbitrary forfeiture, and, considering the true intent of the parties to be the performance of such act or service, will relieve the defaulting party from such forfeiture if the damages to the injured party can be oth- erwise compensated. 1 the form of the transaction to its substance, and will deny him re- lief. Beach v. Shaw, 57 111. 17. Stockton v. Railroad Co., 50 N. J. Eq. 73, 24 Atl. 964, 17 L. E. A. 97. Courts of equity look behind the forms of judgments, and inquire into the nature of the demands on which they are founded, and the relation to the parties, when necessary to the preservation of equitable rights. Meir v. Bank, 55 Ohio St 460, 45 N. E. 907. Relief from forfeitures for breach of covenants in leases. Bow- ser v. Colby, 1 Hare, 109; White v. Warner, 2 Mer. 459; Palmer v. Ford, 70 111. 369. And for other cases see Peachy v. Duke of Som- erset, 1 Strange, 477; Id., 2 White & T Lead. Cas. Eq. 1082; Hagar v. Buck, 44 Vt. 285, 5 Am. Rep. 368; Warner v. Bennett, 31 Conn. 468; Orr v. Zimmerman, 63 Mo. 72; Robinson v. Loomis, 51 Pa. 78. 1 1n the case of Sloman v. Walter, 1 Brown, Ch. 418, 1 White & T. Lead. Cas. Eq. 1094, an injunction was issued to restrain a suit for the recovery of a penalty prescribed in the bond, and the chancellor 84 MAXIMS. (Oil. 3 This maxim has also been of great importance in de- veloping the equity jurisprudence relating to the character- istics of mortgages, and the rights of parties thereunder. Even at the present time a mortgage is in form a convey- ance, conditioned to be void on the repayment by the mort- gagor, on a specified day, of the sum secured, with interest. The common-law courts, looking merely, at the form of the instrument, held the mortgagee's estate indefeasible, unless the money was paid on the very day stipulated. Equity, however, regarding the intent of the parties to be the pay- ment of the debt, and deeming it equitable that that should be treated as done which in good conscience ought to be done, permitted the mortgagor to redeem after the time fixed, on payment of principal and interest then due.' Many other equitable estates have arisen through the application of this important maxim. The common law, in its rigid observance of form, compelled contracting parties to obey absolutely the terms and stipulations of their valid agreements. "Performance to the very letter of every cove- nant or promise was the inflexible rule." Equity tempered the hardness of this rule, and, ever looking for the meaning and intent of the agreement, and ever striving to enforce the performance of the equitable "ought," devised certain equitable estates and liens which could find no place in the common law. Thus it has been held that an absolute deed, taken as security for a debt, is, in equity, a mortgage. 10 And where a mortgage is so imperfectly executed as to be en- tirely nugatory at law as a valid mortgage, equity will nev- eald: "The rule that where a penalty Is Invested merely to secure the enjoyment of a collateral object, the enjoyment of the object is considered as the principal Intent of the deed, and the pen- alty only as accessional, and therefore only to secure the damage really Incurred, IB too strongly established In equity to be shaken." 1 Spence, Eq. Jur. 601; Langford v. Barnard, Toth. 134 (de- cided 37 Ellz.); Emmanuel College v. Evans, 1 Ch. It. 18. 1 Pom. Eq. Jur. 370. 10 Stinchfield v. Mllliken, 71 Me. R67; Morris v. Nixon, 1 How. 118, 11 L. Ed. 69; Russell v. Southard, 12 How. 139, 13 L. Ed. 927; Ex parte Odell, 10 Ch. Dlv. 76. If a transaction resolve Itself Into a security, whatever may be Its form, and whatever name the par- ties may choose to give It, It Is In equity a mortgage. Flagg v. Mann, 2 Suum. 533, Fed. Cas. No. 4,847. 22) THE INTENT BATHER THAN TO THE FORM. 86 ertheless declare the instrument a valid agreement to give a mortgage, and an equitable lien upon the land will exist, valid for all purposes, and as against all persons, except a purchaser for a valuable consideration, and without notice. 11 Another striking example of the application of this maxim by courts of equity is in its treatment of instruments under seal. At common law a seal was declared to be conclusive evidence of a valuable consideration, and to estop any in- quiry into its existence. 12 Equity, looking at the intent, rather than the form, disregarded the presence of a seal, and always permitted evidence to be adduced as to whether there was an actual consideration. In the same manner a court of equity refused to be bound by the common-law rule that a sealed instrument could only be discharged by a writ- ing under seal, and would afford the obligor such relief as the circumstances might demand, frequently in the nature of an injunction to compel the obligee to deliver up or cancel the sealed instrument. 18 The maxim has also been held to be specially applicable in cases of suretyship, with respect to which, whatever may be the form of the instrument, or the obligation of the parties on its face, a court of equity always inquires into the real nature and objects of the transaction, and affords relief accordingly. 14 But the maxim does not apply alone to carry out the true intent of the parties to a contract. It applies as well to frustrate that intent when- ever it contravenes the laws of the state, and the parties have adopted some specious form to disguise it. In such cases 'equity will strip off the disguise, and, if necessary to the ends of justice, cancel the contract. 18 It would be useless to at- Love v. Mining Co., 32 Cal. 639, 654, 91 Am. Dec. 602. See, also, Munds vr Cassidey, 98 N. O. 558, 4 S. B. 363, 355; Sparks v. Steel Co., 87 Ala. 294, 6 South. 195; Dreutzer v. Lawrence, 58 Wis. 594, 17 N. W. 423. 12 This doctrine is no longer in force in courts of common law, and actual consideration or want thereof, as the case may be, must be shown. Burling v. King, 66 Barb. (N. Y.) 633; In re Webb's Estate, 49 Cal. 541, 545; Minturn v. Seymour, 4 Johns. Ch. (N. Y.) 497; Wason v. Colburn, 99 Mass. 342. ' is Cross v. Sprigg, 6 Hare, 552; Hurlbut v. Phelps, 30 Conn. 42; Kidder v. Kidder, 33 Pa. 268. i* Dodd v. Wilson, 4 Del. Ch. 114, 409. 6 Stockton v. Railroad Co., 50 N. J. Eq. 52, 24 Atl. 964. A statute 86 MAXIMS. (Ch. 3 tempt, in this connection, an exhaustive enumeration of the applications of this maxim. As has been intimated, it lies at the foundation of almost every equitable estate and doc- trine. This may be shown in the proper place under discus- sions hereinafter in respect to these estates and doctrines. 23. Equity imputes an intent to fulfill an obliga- tion. Where a man is bound to do an act, and he does that which may be considered as done in whole or partial fulfill- ment of his obligation, such shall be construed to be his in- tention. This is so because it is right to put the most favor- able construction on the acts of others, and to presume that a person intended to do right, rather than wrong ; to act con- scientiously, rather than in bad faith ; and even to be just before he is generous. 1 This maxim is especially applicable to cases arising from the performance or satisfaction of ex- press covenants ; as, where a husband covenants to settle on his wife a certain sum, to be expended by trustees in the purchase of lands in a certain county, and he never pays the money to the trustees, but himself purchases lands in such county, takes a conveyance to himself in fee simple, and aft- erwards dies intestate, such lands will be deemed as purchas- ed by the husband in pursuance of the settlement, and will be liable to the terms thereof. 1 And where a person in a fiduci- of New Jersey prohibited the leasing of the property of a domestic railroad to a. foreign corporation. A lease was executed to a finan- cially Irresponsible domestic company, and the lease was guarantied by a wealthy foreign company. The court, disregarding the mere form, held the transaction to be a lease to the foreign company, and the guaranty to be a mere device to evade the statute. See, also, Pennsylvania R. Co. v. Com. (Pa. Sup.) 7 Atl. 368, where an- other device to evade a statute prohibiting the lease of competing railroads was disregarded. 5 23. i Snell, Eq. p. 45; 1 Pom. Eq. Jur. 420; Lechmere v. Lech- mere, 3 P. Wms. 211; Streatfleld v. Streatfleld, 1 White & T. Lead. Cas. Eq. 399; Blandy v. Widrnore, 2 White & T. Lead. Cas. Eq. 428. Sowden v. Sowden, 1 Brown, Ch. 682. And see post, c. 9. See, also. Wilcocks v. Wllcocks. 2 Vern. 558. 2 White & T. Lead. Cas. Eq. (4th Am. Ed.) 833. Where a person having no real estate cove- nants to convey and settle lauds, and afterwards he purchases, 23) EQUITY IMPUTES INTENT TO FULFILL OBLIGATION. 87 ary capacity as a trustee, executor or administrator, guard- ian or committee, director or manager of a corporation, agent, or partner in control of partnership funds purchases proper- ty, either real or personal, with trust funds in his hands, and takes the title thereto in his own name, without any declar- ation of the trust, he will be deemed to have purchased for the benefit of the cestuis que trustent, and as to such prop- erty he will still be deemed a trustee. Equity will impute to the trustee an intent to conscientiously fulfill his obligations as such trustee, and will not assume that he intended to vio- late his fiduciary duties. 8 But the money paid by the trustee for the property purchased must be identified as trust mon- eys. 4 In a rather recent leading case in England, the prin- ciple was carried still further. It was held that, where one holding money in a fiduciary capacity mingles it with his own, and draws out of the mixed fund, equity will presume that he is rightfully drawing out his own money, rather than that he is drawing out the trust funds in violation of his trust ; and it was accordingly held, contrary to the general rule applying the first drawings to the first deposits, that the unexpended balance was subject to a charge for the entire amount of the trust funds. 5 but does not convey and settle, he will be deemed to have pur- chased for the purpose of fulfilling his obligation, and the lands thus purchased will be treated as subject to the covenants. Deacon v. Smith, 3 Atk. 323; Wellesley v. Wellesley, 4 Mylne & C. 581. As to trustees, see Schlaefer v. Corson, 52 Barb. (N. Y.) 510; Day v. Roth, 18 N. Y. 448; Ferris v. Van Vechten, 73 N. Y. 113; McLarren v. Brewer, 51 Me. 402. As to partners, see Homer v. Homer, 107 Mass. 85; Jenkins v. Frink, 30 Cal. 586, 89 Am. Dec. 134; Oliver v. Piatt, 3 How. 401, 11 L. Ed. 622. As to guardians and committees, see Bancroft v. Consen, 13 Allen (Mass.) 50; John- son v. Dougherty, 18 N. J. Eq. 406; Reid v. Fitch, 11 Barb. (N. Y.) 399. As to executors or administrators, see Stow v. Kimball, 28 111. 93; White v. Drew, 42 Mo. 561. As to directors of corporations?, see Robb's Appeal, 41 Pa. 45; Bridenbecker v. Lowell. 32 Barb. (N. Y.) 10. < Ferris v. Van Vechten, 73 N. Y. 113. In re Hallett's Estate, 13 Ch. Dlv. 696, 727, 745, followed In Central Nat Bank v. Insurance Co., 104 U. S. 54, 26 L, Ed. 693; Englar v. Offutt, 70 Md. 78, 86, 16 AtL 47. 83 MAXIMS. (Ch. 3 EQUITY ACTS IN PEBSONAM. 24. Equity acts in personam. The force and ef- fect of this maxim has been modified by statute in most of the states, so that a de- cree of a court of equity operates, -when necessary, as a transfer of title to real es- tate; and, -whenever such decree merely di- rects the payment of money, it may be en- forced by execution against the property of the unsuccessful party in the same manner as a judgment at law. This is a maxim descriptive of the procedure in a court of equity, and is not, perhaps, in any other respect a maxim or principle of equity itself. A decree of a court of equity did not, by its own force, vest in a party in whose favor it was granted a legal estate, interest, or right to which he was de- clared to be entitled, nor could it transfer a legal right or title from one party to another. Such decree was a personal de- mand that the defendant perform as therein directed, but the personal act of the defendant was necessary to complete the relief which had been granted the plaintiff by such decree. Such decrees were enforceable by attachment against the person, or by process of contempt, under which the party failing to obey the decree was arrested and imprisoned until he yielded obedience, or purged the contempt by showing that the disobedience was not willful, but the result of in- ability, not produced by his own fault or contumacy. 1 Un- der existing state statutes decrees of courts of equity are themselves, in many instances, directly enforceable against the property of the defendant, and of themselves or by offi- cers of the court convey the estate or afford the relief sought, without the necessity of personal action on the part of the defendant ; but these statutes are only in force with- I 24. i Clements v. Tillman, 79 Ga. 451, 5 8. B. 194; Dickinson T. Hoomea' Adm'r. 8 Grat (Va.) 410; Pain v. Pain, 80 N. C. 322, 24) EQUITY ACTS IN PERSONAM. 89 in the boundaries of the states where enacted. 2 The United States courts are unaffected by such statutes, and, in the ab- sence of legislation by congress, the ordinary doctrine as to the effect of remedies and decrees in equity is still in oper- ation. 3 Notwithstanding the various state statutes provid- ing that decrees in equity apply to and are enforceable in rem, many equitable remedies exist which are unaffected by the change, and still retain their personal character. Acting directly on the conscience and person, equity will not permit an unconscientious or oppressive use of the common or stat- ute law. This principle may be illustrated by the case of a devise of certain lands secured by a person by wrongful and fraudulent misrepresentations made by him to the testator. In equity the fraud of the devisee should not be permitted to succeed. But the statute relating to the execution of wills is peremptory, and equity will not disregard it. But, directing its decree to the conscience of the devisee, equity prevents his holding the title of the devised lands for his own benefit, and compels him to hold them for the benefit of the person to whom they equitably belong. 4 So, one who enters into a parol agreement for the sale of land, on the faith of which the vendee takes possession, and makes ex- penditures and improvements, will be compelled in equity to 2 Langdon v. Sherwood, 124 U. S. 74, 81, 8 Sup. Ct. 429, 31 L. Ed. 344; Arndt v. Griggs, 134 U. S. 316, 10 Sup. Ct 557, 33 L. Ed. 918. Hart v. Sansom, 110 U. S. 155, 3 Sup. Ct. 586, 28 L. Ed. 101, in which the rule that equity acts in personam is examined, and dis- cussed at length. See, also, Watkins v. Holman, 16 Pet 25, 26, 10 L. Ed. 873; Tardy v. Morgan, 3 McLean, 358, Fed. Gas. No. 13,752; Briggs v. French, 1 Suinn. 504, Fed. Cas. No. 1,870; JMassie v. Watts, 6 Cranch, 148, 3 L. Ed. 181. Lord Westbury, in McCormick v. Grogan, L. R. 4 H. L. 82, 97, ays: "The court of equity has, from a very early period, decided that even an act of parliament shall not be used as an instrument of fraud; and If, in the machinery of perpetrating a fraud, an act of parliament intervenes, the court of equity, it is true, does not set aside the act of parliament but it fastens on the individual who gets a title under that act, and imposes on him, a personal obliga- tion, because he applies the act as an instrument for accomplish- ing a fraud. In this way the court of equity has dealt with the statute of wills and the statute of frauds." 90 MAXIMS. (Ch. 3 execute a deed, notwithstanding the statute of frauds. 6 In such case, also, equity does not act in contravention of the statute, but imposes on the individual seeking to use it as an instrument of fraud a personal obligation to hold the land for the vendee's benefit. And any wrongful act threat- ened by a defendant may be restrained by a personal decree against him. Relief by injunction, in its very nature, depends for its efficacy upon the principle that equity acts in per- sonam, and not in rem. Thus, equity will enjoin an indi- vidual from maintaining unconscientious proceedings in common-law courts, and will punish disobedience of its or- ders by imprisonment.* Jurisdiction of Person. The statutes of the several states have not deprived courts of equity of their power to act in personam. If the subject- matter of the controversy is in another state or country, and without the territorial jurisdiction of such courts, equitable remedies may be granted which affect the person of either party, provided such party is within the jurisdiction of such courts. An equitable decree may be rendered, directed to either party, compelling or restraining the performance of an act respecting a subject-matter which is beyond the ter- ritorial jurisdiction of a court of equity. 7 Hence equitable remedies may be employed by a court of equity in personam against all persons within its jurisdiction for relief against fraud, for the settlement of a partnership, the performance of a contract, or any other similar purpose, even if the subject- 1 Pom. Eq. Jur. 430. Earl of Oxford's Case, 1 Ch. R. 1, 2 White & T. Lead. Cas. Eq. 642; Marine lus. Co. v. Hodgson, 7 Cranch, 332. 3 L. Ed. 302; Maps v. Cooper, 39 N. J. Eq. 31G; Texas & P. Ry. Co. v. Kuteman, 54 Fed. 547, 4 C. C. A. 503. The Injunction operates on the parties, and not on the court of law; and hence, if it proceeds with the action, its Judgment is not void. Platt v. Woodruff, 61 N. Y. 378. f Adams v. Messlnger, 147 Mass. 185, 17 N. E. 491. In this case an agreement between an inventor and an assignee of a patent, binding the inventor to patent certain improvements in Canada whenever such a patent was secured in the United States, was held capable of specific performance in Massachusetts. Where a court of equity has Jurisdiction of the parties. It n^ay compel them to do equity in relation to lands located without Its jurisdiction. Gard- ner v. Ogden, 22 N. Y. 327, 333. 24) EQUITY ACTS IN PERSONAM. 91 matter is without its jurisdiction.* It has been frequently held, both in this country and England, that a court of equity has power to restrain a person within its jurisdiction from prosecuting an action in a foreign court.* In this connection Judge Story says : "When both parties to a suit in a foreign country are residents within the territorial limits of another country, the courts of equity in the latter may act in per- sonam upon these parties, and direct them by injunction to proceed no further in such suit. In such case these courts act upon acknowledged principles of public law in regard to jurisdiction. They do not pretend to direct or control the foreign court, but, without regard to the situation of the subject-matter of the suit, they consider the equities between the parties, and decree in personam according to those equi- ties ; and enforce obedience to their decrees by process in personam." 10 And in a proper case the court will restrain a party from leaving its jurisdiction, although this is a reme- Jurisdiction of equity In case of fraud is sustainable wherever the person sought to be affected is reached, even if land affected by the decree is without the jurisdiction of the court. De Klyn v. Watkins, 3 Sandf. Ch. (N. Y.) 185; Davis v. Morriss' Ex'rs, 76 Va. 21. Payment of legacy from lands without the jurisdiction. Lewis v. Darling, 16 How. 1, 14 L. Ed. 819. In the case of Massie v. Watts, 6 Cranch, 148, 3 L. Ed. 181, Chief Justice Marshall, after reviewing all the leading English cases, concludes by holding that in case of fraud, of trust, or of contract the jurisdiction of a court of chancery is sustainable wherever the person be found, although lands not within the jurisdiction of that court may be affected by the decree. Portarlington v. Soulby, 3 Mylne & K. 104; Mackintosh v. Og- ilvie, 3 Swanst. 365, note; Carron Iron Co. v. Maclaren, 5 H. L. Cas. 416, 445; Hutton v. Hutton, 40 N. J. Eq. 461, 2 Atl. 280; Cole v. Cunningham, 133 U. S. 107, 10 Sup. Ct. 269, 33 L. Ed. 538; Dehon v. Foster, 4 Allen (Mass.) 545, 550. Injunction against proceedings in another state to attach exempt property. Snook v. Snetzer, 25 Ohio St 516; Wilson v. Joseph, 107 Ind. 490, 8 N. E. 616; Allen v. Buchanan (Ala.) 11 South. 777. See, also, Dale v. Roosevelt, 5 Johns. Ch. (N. Y.) 174 (where Chancellor Kent granted an injunction to restrain suit upon an agreement relating to lands in Ohio); Pickett v. Ferguson, 45 Ark. 177, 55 Am. Rep. 545; Great Falls Co. v. Worster, 15 N. H. 412; Proctor v. Bank, 152 Mass. 223, 25 N. E. 81, 9 L. R. A. 122; Wilson v. Joseph, 107 Ind. 490, 8 N. E. 616. 10 Story, Eq. Jur. 899; High, Inj. 103-107. 92 MAXIMS. (Ch. 3 dy which at the present time is little used. 11 It seems now well established that a court of chancery, having jurisdiction of the party in whom the legal title to the land in controver- sy is vested, may, by its process of attachment and injunc- tion, compel him to do justice by the execution of such con- veyances and assurances as will affect the title of the prop- erty in the jurisdiction where it is situated. 1 * In general, the fact that the property is not within the jurisdiction con- stitutes no bar to a proceeding in a court of equity, if the person is within the jurisdiction, for a court of equity acts upon the person ; or, to use the appropriate phrase, "JEqui- tas agit in personam." " But the claim, to affect foreign i Enos v. Hunter, 9 111. 211; Denton v. Denton, 1 Johns. Ch. (N. T.) 364; Porter v. Spencer, 2 Johns. Ch. (N. Y.) 169; Griswold v. Hazard, 141 U. S. 260, 11 Sup. Ct 972, 35 L. Ed. 678; Bankr. Act 1898, 7, subd. 6. 12 Gardner v. Ogden, 22 N. T. 327, 339, citing Mead v. Merritt, 2 Paige (N. Y.) 402; Mitchell v. Bunch, Id. 606, 22 Am. Dec. 669; Sutphen v. Fowler. 9 Paige (N. Y.) 280; Shattuck v. Cassidy, 3 Edw. Ch. (N. Y.) 152; Newton v. Bronson, 13 N. Y. 587, 67 Am. Dec. 89. And see Bailey v. Ryder, 10 N. Y. 363. The circumstances that the real property constituting the subject-matter of the contract was situated In another state presents no obstacle to the Jurisdic- tion. Sloan v. Baird, 162 N. Y. 327, 331, 56 N. E. 752. See, also, Massie v. Watts, 6 Cranch, 148, 3 L. Ed. 181. i Story, Eq. PI. 8 489. And see Penn v. Baltimore, 2 White & T. Lead. Cas. Eq. 1047. Conveyance of land may be decreed, Mullet v. Dows, 94 U. S. 444, 24 L. Ed. 207. If the parties in an action for a specific performance are within the Jurisdiction of the court, the fact that the subject-matter Is without such Juris- diction is immaterial. Burrell v. Root, 40 N. Y. 496; Brown v. Desmond, 100 Mass. 267. Courts of equity In England are, and always have been, courts of conscience, operating In per- sonnm, and not In rem; and in the exercise of this personal ju- risdiction they have always been accustomed to compel the per- formance of contracts and trusts as to subjects which are not either locally or rntione domicilii within their jurisdiction. Lord Sel- borne. In Ewlng v. Ewlng, 9 App. (Jus. 34; Id., Brett's Lead. Cas. Mod. Eq. 234. And see the following American cases: Guild T. Guild, 16 Ala. 121; McGee v. Sweeney, 84 Cal. 100, 23 Pac. 1117; Montgomery v. U. S. (C. C.) 36 Fed. 4; Carver v. Peck, 131 Mass. 292; Bethell v. Bethell, 92 Ind. 318; Johnson v. Gibson, 116 111. 294, 6 N. E. 205; Polndexter v. Burwell, 82 Va. 507; Allen v. Bu- chanan. 97 Ala. 399. 11 South. 777; Cooley v. Scarlett, 38 111. 316, 87 Am. Dec. 298; Harris v. Pullman, 84 111. 20, 25 Am. Rep. 416. A party within the Jurisdiction of a court of equity may be compelled. 24) EQUITY ACTS IN PERSONAM. 93 lands through the person of the party, must be strictly limit- ed to those cases in which the relief decreed can be entire- ly obtained through the party's personal obedience. 14 If the relief sought is such that it must act directly upon specific property located without the court's jurisdiction, and not upon the person of the defendant, the suit must be brought where the property is situated. As, for instance, a suit can- not be entertained to determine or affect the title to lands situated in another state. 18 Nor will equity decree partition of land situated in a foreign state or country, because no power could be given to commissioners to go there, and take the steps necessary for carrying out the decree. 16 A suit to foreclose a mortgage on lands situated beyond the territo- rial jurisdiction of a court of equity cannot be maintained. 17 But it is a settled law that a decree of foreclosure, and a sale of the entire mortgaged property, is valid, although part of the mortgaged property lies without the territorial jurisdic- tion of the court within which the suit was brought. 18 Eq- under certain circumstances, to transfer title to real property in another state. Baker v. Rockabrand, 118 111. 365, 8 N. B. 456. i Westl. Priv. Ink Law, 64, 65. IB Northern Indiana R. Co. v. Railroad Co., 15 How. 233, 14 L. Ed. 674; Massie v. Watts, 6 Cranch, 148, 3 L. Ed. 181; Lindley v. O'Reilly, 50 N. J. Law, 636, 640, 15 Atl. 379, 1 L. R. A. 79; Carpen- ter v. Strange, 141 U. S. 106, 11 Sup. Ct. 960, 35 L. Ed. 640. i Cart wright v. Pettus, 2 Ch. Cas. 214; Poindexter v. Bur well, 82 Va. 507; Wimer v. Wimer, Id. 890, 3 Am. St. Rep. 126. if Farmers' Loan & Trust Co. v. Telegraph Co., 55 Conn. 334, 11 Atl. 184, 3 Am. St. Rep. 53. is Muller v. Dows, 94 U. S. 444, 24 L. Ed. 207, where Mr. Justice Strong said: "Without reference to the English chancery decisions, where this objection to the decree would be quite untenable, we think the power of a court of chancery in this country is sufficient to authorize such a decree as was here made. It is here undoubtedly a recognized doctrine that a court of equity, sitting in a state, and having jurisdiction of the person, may decree a conveyance by him of land in another state, and may enforce the decree by process against the defendant. True, it cannot send its process into an- other state, nor can It deliver possession of land in another juris- diction; but it can command and enforce a transfer of the title. And there seems to be no reason why it cannot, in a proper case, effect the transfer by the agency of trustees when they are com- plainants." See, also, McElratb, v. Railroad Co., 55 Pa. 189; White v. Hall, 12 Ves. 321; MacGregor v. MacGregor, 9 Iowa, 65. And see 94 MAXIMS. (Ch. 3 uity will not, however, entertain jurisdiction of an action to recover proceeds of the sale of real estate situated in a for- eign country, where title to the property is in dispute. 1 * 25. Equity acts specifically, and not by way of compensation. Equity attempts to place the parties in the position which they ought to occupy by decreeing specifically that each party be given the rights which he ought to enjoy, and put- ting an end to the wrongs of which either party may be guilty. With few exceptions, courts of law can only direct the payment of a sum of money as compensation for injuries suffered by either party, and cannot prevent the repetition of the injuries. As will thus be seen, this maxim illustrates the great difference in the jurisdiction of equity and law. 1 It is the embodiment of a general principle running through the whole system of equity jurisprudence. To illustrate this maxim it will only be necessary to refer to a few equitable doctrines and remedies. Thus equity will compel a contract to be specifically performed, instead of awarding damages for its breach. Where a mistake has been made in a written instrument, or the instrument itself has been lost or destroy- ed, equity, acting specifically, will place the parties in the same situation as though the mistake or loss had not oc- curred, by decreeing a reformation in the one case and a re- execution in the other. Bankr. Act 1898, 7, subd. 5, compelling bankrupt to make convey- ance to his trustee. i In re Hawthorne, 23 Ch. Dlv. 745. i 25. i Snell, Eq. Jur. p. 47. 2G-27) PENALTIES AND FORFEITURES. 95 CHAPTER IV. PENALTIES AND FORFEITURES. 26-27. Doctrine Relative to Penalties and Forfeiture*. 28-29. Definitions. 30. Grounds for Relief. 81. Liquidated Damages. 82. Rules Governing the Determination as to Liquidated Dam- ages or Penalty. 83. Enforcing Forfeitures. 84. When Equity Will Relieve Against Forfeitures. 85. Statutory Penalties and Forfeitures. DOCTRINE RELATIVE TO PENALTIES AND FOR- FEITURES. 26. Whenever a penalty or forfeiture is inserted in a contract merely to secure the perform- ance of some act, or the enjoyment of some right or benefit, such performance or en- joyment is the substantial and principal in- tent of the parties to the contract, and the penalty or forfeiture is only accessory thereto. 27. Equity -will not enforce, but will relieve against, such penalty or forfeiture upon pay- ment by the party subjected thereto of the amount due, with interest, or of damages proportionate to the injury occasioned by a failure to perform the act or secure the en- joyment of the right or benefit. The doctrine was originally applied to those cases where the penalty or forfeiture was for the purpose of enforcing the payment of a sum of money ; but later the doctrine was extended to cases where the penalty or forfeiture was used 96 PENALTIES AND FORFEITURES. (Ch. 4 to secure the performance of a specific act, or the enjoy- ment of some right or benefit. It is now a general principle, to be applied in all courts of equity, that equity will relieve where a penalty is forfeited, if the case admits of a certain compensation ; and the true foundation of such relief is that, when penalties are designed only to secure money or dam- ages really incurred, if the party obtains his money or dam- ages, he gets all that he expected or required. 1 The doc- trine, as we have seen, rests on the maxim that equity looks at the intent, rather than the form, of a transaction. 2 The common law has followed equity, and now in most states, in a great variety of cases, relief may be had in common-law courts against penalties and forfeitures.* 26-27. i Skinner v. Dayton, 2 Johns. Ch. (N. Y.) 526, 535, citing Sanders v. Pope, 12 Ves. 282; Davis v. West, Id. 475. And see Livingston v. Tompkins, 4 Johns. Ch. (N. Y.) 432, 8 Am. Dec. 598, where the court says: "It may be laid down as a fundamental doctrine of the court that equity does not assist the recovery of a penalty or forfeiture, or anything In the nature of a forfeiture." Followed in Marshall v. Mayor, etc., of City of Vicksburg, 16 Wall. 146, 149, 21 L. Ed. 121. a Peachy v. Duke of Somerset 1 Strange, 447; Sloman y. Walter, 1 Brown, Ch. 418. "Accident Is undoubtedly the origin of the ju- risdiction of chancery upon the subject of penalties, but subse- quently the Jurisdiction was extended to embrace all questions as to penalties irrespective of accident." Bisp. Eq. 178, citing 1 Spence, Eq. 629, 630. Story says that it is highly probable that relief was first granted in such cases upon the ground of accident, or mistake, or fraud. Story, Eq. Jur. 1313. But Pomeroy does not concur In this view of the origin of this relief. The doctrine has a deeper foundation In universal principles of right, and is grounded In the maxim that equity looks to the intent, rather than to the form. Pom. Eq. Jur. 378, 381, 433, note. Statutes In England have rendered It unnecessary for equity to relieve from a penalty, by providing that a debtor should be dis- charged, In every case, from his obligation, on payment of principal, interest, and costs. 8 & 9 Wm. III. c. 11, and 4 & 5 Anne, c. 16, f 12, 13. Similar statutes are in force in the several states In this country. But the Jurisdiction of a court of chancery to Interfere Btill exists. Ewlng y. Litchfield, 91 Va. 675, 22 8. E. 882; Lynch y. Gas Co.. 165 Pa. 518, 30 Atl. 984. 28-29) DEFINITIONS. 97 DEFINITIONS. 28. A penalty is a sum of money which the ob- ligor contracts to pay by way of penalty if he fails to perform or carry out the terms imposed on him by the contract. 29. Forfeiture is a destruction or deprivation of some estate or right because of the failure to perform some obligation or condition con- tained in a contract. There is a distinction between a penalty and a forfeiture, although, in a general sense, the two words have the same meaning. Relief is always given against a penalty if com- pensation can be made, for it is deemed a mere security; but in the case of a forfeiture relief is not always given, al- though compensation can be made. A court of equity will not always set aside a forfeiture incurred on the breach of a covenant, although the resulting damages may be easily ascertained, and payment made therefor in money, unless upon the ground of accident, mistake, surprise, or fraud. If a person is liable, under his obligation, to pay a certain sum of money, but stipulates that, if such sum is not paid at the time stated in the contract, he will pay a larger sum of mon- ey, such stipulation is a penalty; if such stipulation involves the loss of lands, chattels, or securities for a failure to pay a certain sum or perform a certain act, it is a forfeiture. Where a sale of an estate was made on terms that half the purchase money should be paid at once, and the other half on a fixed day, and that, if the whole was not paid on that day, the vendor should retain the estate and all the money then paid, it was held to be a penalty, as forfeiting the pur- chase money paid for a default in part, and relief was given on payment of the unpaid balance with interest. 1 When a par- ty contracts in the alternative, agreeing to pay a certain sum if he performs one of the alternative stipulations, and a larger sum if he performs the other stipulation, equity does 28-29. i In re Dagenham Dock Co., 8 Ch. App. 1022. EATON, EQ. 7 98 PENALTIES AND FORFEITURES. (Ch. 4 not regard the latter stipulation as a penalty. In a leading English case, Lord St. Leonards, in speaking of such al- ternative contracts, says: "If a man covenants to abstain from doing a certain act, and agrees that, if he does it, he will pay a sum of money, he would be compelled to abstain from doing that act ; for he cannot, in such a case, elect to break his engagement, and pay the penalty instead. But if a man lets meadow land for two guineas an acre, and the contract is that, if the tenant chooses to employ it in tillage, he may do so, paying an additional rent o'f two guineas an acre, the breaking up of the land is an act permitted by the contract, which in that case provides that the landlord is to receive the increased rent." a In other words, the lessee may do with the land as he pleases. If he uses it in one way, he is to pay one rent, and, if in another, a larger rent. Such an ar- rangement is altogether different from an agreement not to do a thing, with a penalty for doing it.* And if an agreement is made for the payment of a smaller sum at a certain time, and in a certain manner, in discharge of an existing debt, with the condition that in default of payment the whole debt shall be payable, the reserved right to compel the payment of the original debt is not a penalty, and equity will afford no relief against it. 4 Where a mortgage is made at a certain rate of interest, conditioned that, if payments thereunder are not punctually made, a higher rate of interest shall be char- ged, such increased interest is a penalty, and relief may be had if the debtor pay interest at the lower rate, including in- French v. Macale, 2 Dru. & War. 274. See, also, Parfltt v. Cham- bre, L. R. 15 Eq. 36. Hardy v. Martin, 1 Cox, 27; Herbert v. Railway, L. R. 2 Eq. 221, 224, 225. * Thompson v. Hudson, L. R. 4 H. L. 1; Ford v. Earl of Chester- field, 19 Beav. 429; United States Mortg. Co. v. Sperry, 138 U. S. 813, 348, 11 Sup. Ct. 321, 332, 34 L. Ed. 969, 982; Reeves v. Stipp. 91 111. 609. In Peachy v. Duke of Somerset, 2 White & T. Lead. Cas. Eq. 2025, it is said that: "Where a certain sum of money is due, and the creditor enters into arrangements with his debtor to take a lesser sum, provided that sum is secured In a certain way, and paid at a certain day, but, if any of the stipulations of the arrange- ments are not performed as agreed on, the creditor Is to be entitled to recover the whole of the original debt, such remitter to his original rights does not constitute a penalty, and equity will not In- terfere to prevent its observance." 30) GROUNDS FOR RELIEF. 99 terest for the delay; but, if a certain rate of interest is fixed, and the mortgagee agrees to take less if it be paid punc- tually, the agreement is valid, and no relief can be given. 5 And where a debt is contracted to be paid in installments, subject to the condition that on default of any installment the whole sum will become payable at once, the condition is not a penalty, and there is no relief against it.' But, if the debtor is prevented by the fraud or inequitable conduct of the creditor from paying the installment, relief may be had in equity from the effect of the default. 1 GROUNDS TOR BELIEF. 80. The general test by which to ascertain whether relief in equity can or cannot be had against a penalty is to consider whether or not adequate compensation can be made for a breach of the obligation se- cured by such penalty. (a) If the penalty is to secure the payment of money, the debtor party will be relieved Fowls v. Maynard, 3 Atk. 519; Attwood v. Taylor, 1 Man. & G. 279; Wallls v. Smith, 21 Ch. Div. 249. People v. Superior Court, 19 Wend. (N. T.) 104; Noyes v. Clark, 7 Paige (N. Y.) 179, 180; Malcolm v. Allen, 49 N. Y. 448; Bennett v. Stevenson, 53 N. Y. 508. A court of equity cannot relieve a mort- gagor from a failure to pay taxes. Ferris v. Ferris, 28 Barb. (N. Y.) 29; Spring v. Fisk, 21 N. J. Eq. 175, 178. See, also, Baldwin v. Van Vorst, 10 N. J. Eq. 577; Martin v. Melville, 11 N. J. Eq. 222; Robinson v. Loomis, 51 Pa. 78; Schooley v. Komain, 31 Md. 574, 579; Ottawa Northern Plank-Road Co. v. Murray, 15 111. 337; Har- per v. Ely, 56 111. 179; Magnusson v. Williams, 111 111. 450; Hood- less v. Reid, 112 111. 105, 1 N. E. 118; Gibbons v. Hoag, 95 111. 45; Chapin v. Billings, 91 111. 539; Howell v. Railroad Co., 94 U. S. 463, 24 L. Ed. 254; WIlcox v. Allen, 36 Mich. 160. i Bennett v. Stevenson, 53 N. Y. 508, where it Is clearly held that fraud or Improper conduct on the part of the creditor would operate as an excuse. Noyes v. Anderson, 124 N. Y. 175, 26 N. E. 816, 21 Am. St. Rep. 657, in which case relief was given for a default In the payment of taxes on the mortgaged premises, occa- sioned by mistake. See, also, Martin v. Melville, 11 N. J. Eq. 222; Wilcox T. Allen, 36 Mich. 160. 100 PENALTIES AND FORFEITURES. (Ch. 4 on the payment of the amount, with in- terest and costs. (b) If the penalty is to secure the performance of a collateral act or undertaking, equity will interfere if adequate compensation can be made the creditor party. The earliest case for relief against penalties was where the penalty was contained in a common bond to secure the payment of the principal and interest thereof. 1 In such a case there is no difficulty in ascertaining the amount which is sufficient to compensate the creditor for the failure of the debtor to make the agreed payment. At a later time, how- ever, equity assumed to grant relief against a penalty or for- feiture imposed for a breach of any obligation, provided such breach could be amply compensated by a payment of mon- ey. 2 The true ground of relief in both these cases is that, as the penalty is designed as a mere security, if the party ob- tains his money or his damages, he gets all that he expected, and all that in justice he is entitled to. 8 Where a penalty or forfeiture is designed merely as a security to enforce the principal obligation, it is as much against conscience to al- low any party to pervert it to a different and oppressive pur- pose as it would be to allow him to substitute another for the principal obligation. 4 As has been noticed, if the penalty is for the payment of money only, and the penalty requires a payment of a larger sum, the rule is easily applied.* But, 30. i Peachy v. Duke of Somerset, 2 White & T. Lead. Cas. Eq. p. 1245. a Sloman v. Walter, 2 White & T. Lead. Cas. Eq. p. 1260. note. Skinner v. Dayton, 2 Johns. Ch. (N. Y.) 535. "In reason, In conscience, In natural equity, there is no ground to say, because a man has stipulated for a penalty In case of his omission to do a particular act (the real object of the parties being the performance of the act), that, If he omits to do the act, he shall suffer an enor- mous loss, wholly disproportionate to the Injury to the other party. If it be said that it is his own folly to have made such a stipula- tion. It may equally well be said that the folly of one man cannot authorize gross oppression on the other side." Story, Eq. Jur. $ 131(5. Story, Eq. Jur. 1316. Thompson T. Hudson, L. II. 4 H. L. 15, in which case Lord 31) LIQUIDATED DAMAGES. 101 when the penalty is to secure the performance of some col- lateral act, it is more difficult. The penalty in such case may be in the nature of liquidated damages, and as such en- forceable both in law and equity. The cases relative to the question as to whether a provision in a contract for the pay- ment of money for a breach thereof is to be treated as a pen- alty or as stipulated damages are many and varied. The de- termination of such question is by no means free from diffi- culties. It is probable that no one rule of universal appli- cation can be stated which will be decisive in reaching such determination. The most that can be done is to state a few special rules which are of importance in considering the question, and which are applicable to most, if not all, agree- ments. LIQUIDATED DAMAGES. 81. If a contract is for the performance or non- performance of some act other than the pay- ment of money, and the nature of the con- tract is such that the damages resulting from the violation thereof cannot be readily and definitely ascertained, an express clause may be inserted therein providing for the pay- ment of a certain sum of money as liqui- dated damages for such violation, and as Hatherley says: "Where there is a debt actually due, and In re- spect of that debt a security is given, be it by way of mortgage or be it by way of stipulation that, in case of its not being paid at the time appointed, a larger sum shall become payable and be paid, in either of these cases equity regards the security that has been given as a mere pledge for the debt, and it will not allow either a for- feiture of the property pledged, or any augmentation of the debt as a penal provision, on the ground that equity regards the contem- plated forfeiture which might take place at law with reference to the estate as in the nature of a penal provision against which equity will relieve when the object in view, viz. the securing of the debt, is attained, and regarding also the stipulation for the payment of a larger sum of money, if the sum be not paid at the time it is due, as a penalty and a forfeiture against which equity will relieve." See, also, Holies v. Wyse, 2 Vern. 289; Strode v. Barker, Id. 3l6; Nicholls v. Maynard, 3 Atk. 519; Wallis v. Smith, 21 Ch. Div. 243. 102 PENALTIES AND FORFEITURKS. (Ch. 4 full compensation therefor. Such a provi- sion is enforceable in law and equity. Liquidated damages may be said to occur when the parties to a contract have agreed that, in case one party shall do a stipulated act, or omit to do it, the other party shall receive a certain sum as the just, appropriate, and conventional amount of the damages sustained by such act or omission. In such cases equity will not interfere, but will deem the par- ties competent to determine what the measure of damages should be. But relief may be had, even in cases where the damages are agreed upon, if they are grossly and unreason- ably disproportionate to the nature or extent of the injury. 1 If there is doubt as to whether the parties intended to ex- press stipulated damages or a penalty, the tendency of the courts will be in favor of the latter, because the law favors mere indemnity. 1 BULES GOVERNING THE DETERMINATION AS TO LIQUIDATED DAMAGES OR PENALTY. 32. The following rules may be stated as affect- ing the question whether an amount stated in a contract to be paid for a breach thereof is intended as liquidated damages or a penalty: (a) When, from the nature of a contract, it is im' possible to definitely compute the dam- I 31. i Story, Eq. Jur. 1318. See, also, Clement v. Cash, 21 N. T. 253; Colwell v. Lawrence, 38 N. Y. 71; Perkins v. Lyman, 11 Mass. 76; Lynde v. Thompson, 2 Allen (Mass.) 456, 450; Streeper T. Williams, 48 Pa. 450. State v. Dodd, 45 N. J. Law, 525; Wallls v. Carpenter, 13 Allen (Mass.) 19. And see Fitzpatrlck v. Cottlngham, 14 Wls. 219. Eq- uity IB best satisfied by the payment of damages, and no more, and will accept the conclusion that a sum stated in a contract was in- tended as liquidated damages only when plainly shown. Balrd v. Tolllver, 6 Humph. (Tenn.) 186, 44 Am. Dec. 298; Oheddick's Ex'r T. Marsh, 21 N. J. Law, 463; Hahn v. Horetman, 12 Bush (Ky.) 249. See. also. Hennessy v. Metzger, 152 111. 505, 38 N. K. 1058; Mon- mouth Park Ass'n Y. Iron Work*. 55 N. J. Law, 132, 26 AU. 140, 89 Am. St Kep. 628, 32) EULES AS TO LIQUIDATED DAMAGES OK PENALTY. 103 ages resulting from a breach thereof, the sum stated therein as compensa- tion for such breach, if not grossly disproportionate to the injuries suf- ered, -will be deemed liquidated dam- ages. This rule involves a considera- tion of the subject in three aspects: (1) The intent of the parties. (2) The reasonableness of the liquidation. (3) The language employed. (b) If the contract provides for a payment of a larger sum on the failure of the party to pay a less sum, or to deliver a thing of less value, the larger sum is a penalty, whatever may be the language used in de- scribing it. (o) When the agreement contains provisions for the performance of several acts, or for omitting to perform several acts, and the damages occasioned by their breach cannot be measured, and it is agreed that a stip- ulated sum shall be paid as damages for a violation of any or all of such provisions, such sum is to be deemed liquidated dam- ages, and not a penalty. (d) When the agreement contains provisions for the performance or nonperformance of va- rious acts -which are not measurable by any exact pecuniary standard, together with one or more other acts, in respect of which the damages occasioned by a breach thereof are easily ascertainable by a jury, and a certain sum is stipulated to be paid 104 PENALTIES AND FORFEITURES. (Ch. 4 on a violation of any or all of these provi- sions, such sum is deemed a penalty, (e) But -where the stipulated sum to be paid in case of a violation of any or all the provi- sions of a contract is the same -whether the party's failure to perform is partial or com- plete, it must be considered a penalty, and not as liquidated damages. These rules are not of sufficient scope to include all cases which may arise in which the determination of the question of what constitutes liquidated damages as distinguished from a penalty is of importance. There are many agreements which cannot be subjected to any fixed rule, and to which the courts will apply general rules of interpretation. The question is always one of construction, and any rule on the subject is a mere guide to the intention of the parties. 1 "When Damages Cannot be Ascertained. Uncertainty as to the extent of the injuries which may en- sue is always a criterion by which to determine whether the case is one of liquidated damages or a penalty. 8 A frequent application of this test is where a party sells his business and the good will thereof, and contracts not to engage in the same business within a given territory, and for a breach thereof to forfeit a certain sum as stipulated damages. In such a case it is clearly apparent that the damages resulting from the breach are not measurable, and the agreed sum may be recovered, unless, of course, it is unreasonable. 8 I 82. i Kunkel v. Wherry, 189 Pa. 198, 42 Atl. 112. Powell v. Borrougbs, 54 Pa. 329; Wolf Creek Diamond Coal Co. T. Scbultz, 71 Pa. 180. Kelso v. Reid, 145 Pa. 606, 23 Atl. 323; Pierce v. Fuller, 8 Mass. 223, 5 Am. Dec. 102; Cushlng v. Drew, 97 Mass. 445; Streeter v. Rush, 25 Cal. 67; Newman v. Wolf son, 69 Ga. 764; Duffy v. Bhockey, 11 Ind. 70, 71 Am. Dec. 348; Splcer v. Hoop, 61 Ind. 365; Johnson v. Gwlnn, 100 Ind. 466; Jaquith v. Hudson, 6 Mich. 128; Cheddlck'a Ex'r v. Marsh, 21 N. J. Law, 463; Hoagland v. Segur, 88 N. J. Law, 230; Nobles v. Bates, 7 Cow. (N. Y.) 307; Smith v. Smith, 4 Wend. (N. Y.) 468; Dakin v. Williams, 17 Wend. (N. Y.) 32) EDLES AS TO LIQUIDATED DAMAGES OB PENALTY. 1 05 And where a purchase was made of a business and a trade secret, which secret the vendor agreed not to divulge under a penalty described in the contract as stipulated damages, the purchaser was held liable to pay the entire penalty as liquidated damages, on the ground that the damages occa- sioned by a violation of the agreement were wholly uncer- tain, and incapable of being ascertained except by conjec- ture. 4 Another frequent application of the rule that dam- ages may be liquidated by the parties is in the case of fail- ure to complete the performance of a contract at the time mentioned therein, as, when a building contract provides that the work shall be completed on a certain day, and in de- fault thereof the builder shall pay a stipulated sum for every day or week for which the completion of the work is delayed beyond that time, the stipulated sum, if reasonable, may be recovered as stipulated damages. 8 The cases mentioned are only a few of those in which the rule that, when the amount of damages occasioned by a breach of a contract cannot be easily ascertained, the sum stipulated will be allowed as liqui- dated damages. A number of cases are cited in the note which are illustrative of this principle. 6 447; Dunlop v. Gregory, 10 N. Y. 241, 61 Am. Dec. 746; Lange v. Werk, 2 Ohio St. 519. * Tode v. Gross, 127 N. Y. 480, 28 N. E. 469, 13 L. R. A. 652, 24 Am. St. Rep. 475. o O'Donnell v. Rosenberg (N. Y.) 14 Abb. Prac. (N. S.) 59; Bridges v. Hyatt, 2 Abb. Prac. 449; Folsom v. McDonough, 6 Gush. (Mass.) 208; Mueller v. Kleine, 27 111. App. 473. But in Wilcus v. Kling, 87 111. 107, where no actual damage could be shown, the stipu- lated sum was deemed a penalty; and, where the stipulated sum is greatly out of proportion to any possible damage, as where it was stipulated in a contract for the construction of a house, the rental value of which was $25 a month, that $150 a week should be paid as damages for delay in the completion of the work, the sum was not allowed as liquidated damages. Clements v. Railroad Co., 132 Pa. 445, 19 Atl. 274, 276. Cotheal v. Talmage, 9 N. Y. 551, 61 Am. Dec. 716; Pearson v. Williams' Adm'r, 24 Wend. (N. Y.) 246; Clement v. Cash, 21 N. Y. 253; Bagley v. Peddle, 16 N. Y. 470, 69 Am. Dec. 713; Leary v. Laflin, 101 Mass. 334; Wolf Creek Diamond Coal Co. v. Schultz, 71 Pa. 180; Powell v. Borroughs, 54 Pa. 329, 336; Brewster v. Edger- ly, 13 N. H. 275; Berrikott v. Traphagen, 39 Wis. 220; Peine v. Weber, 47 111. 41. The sum stipulated to be paid for a breach of contract for the sale of personal property, If the articles sold are 106 PENALTIES AND FORFEITURES. (Ch. 4 Intent of the Parties. If the damages stipulated against are certain and fixed, and may be easily and accurately ascertained, the intent of the parties is immaterial, and the sum stipulated will be con- sidered as a penalty. This is in contravention of the general rule relative to the construction of contracts, which gives controlling weight to the intent of the parties as expressed in the contract. The underlying principle of the whole sub- ject relative to the payment of any stipulated sum for a breach of a contract is that of compensation. If the con- tracting parties lose sight of this principle, and stipulate, not for compensation, but for a sum out of proportion to the actual damages incurred by a breach of the contract, the law will not enforce a payment of the stipulated amount, even if the contract, by express terms, declares such amount to be "liquidated damages." But, if there is uncertainty as to the amount of damages incurred by the breach, the question as to whether the parties intended the stipulated sum to be con- sidered as a penalty or liquidated damages is to be deter- mined, among other things, by considering the language of the contract. 7 The Liquidation must be Reasonable* If the intent, as expressed in the contract, is that the sum stipulated therein should be paid upon a breach, the sum, if such as to be subject to the legal measure of damages, that Is, the difference between the market price and the price agreed to be paid, Is generally considered a penalty. Jemmlson v. Gray, 29 Iowa, 537; Shreve v. Brereton, 51 Pa. 175, 186; Burr v. Todd, 41 Pa. 209. If the contract Is for the sale of a particular kind of personal property, or some specified article of peculiar value, to which It Is Impossible to affix a market value, the stipulated sum may be deemed liquidated damages. See Lynde v. Thompson, 2 Allen (Mass.) 4GO; Gammon v. Howe, 14 Me. 250; Chamberlain v. Bagley, 11 N. H. 234; Mead v. Wheeler, 13 N. H. 351; Shiell v. McNitt, 9 Paige (N. Y.) 101, 103. But, if the stipulated sum is ex- cessive, a court of equity might deem It a penalty. Spencer v. Til- den, 5 Cow. (N. Y.) 144; Burr v. Todd, 41 Pa. 206. T Little v. Banks, 85 N. Y. 258. 260, where the court lays down the rule that In construing such provisions, in contracts, the actual In- tention of the parties, so far as it can be reasonably and fairly ascertained from the language of the contract and from the circum- stances of the case. Is to be considered, citing Oolwell v. Lawrence, 88 N. Y. 71; Cotheal v. Talmage, 9 N. Y. 551, 61 Am. Dec. 716. 32) RULES AS TO LIQUIDATED DAMAGES OR PENALTY. 107 reasonable, and proportionate to the injuries sustained, must be paid by the party in default. If the stipulated sum is un- reasonably large, it will be deemed a penalty, and the courts will require damages to be assessed as if no stipulated sum was named in the contract. 8 Just compensation for the in- jury sustained is the principle at which the law aims, and the parties will not be permitted by express stipulation to set this principle aside.' In many cases, however, it has been stated that the mere amount stipulated is not sufficient of itself to justify the court in holding that it is a penalty. 10 But it is certain that the amount of the sum can always be taken into consideration as an aid in determining the inten- tion of the parties to the contract, and, if it be dispropor- tionate to the damages that would be sustained by the breach, the court may properly declare it to be a penalty. 11 The Language Employed. The language of a contract is not conclusive to determine the question whether a stipulated sum is to be allowed as liquidated damages. Because parties have called a sum dam- ages, or because they have designedly used language and in- serted provisions which are in their nature penal, and yet s People v. Railroad Co., 76 Cal. 29, 18 Pac. 90; Monmouth Park Ass'n v. Iron Works, 55 N. J. Law, 132, 26 Atl. 140; Sedg. Dam. 407; Story, Eq. Jur. ? 1318. Myer v. Hart, 40 Mich. 517, 523, 29 Am. Rep. 553. 10 Clement v. Cash, 21 N. Y. 253; Shiell v. McNitt, 9 Paige (N. Y.) 101; Dwinel v. Brown, 54 Me. 468; Morse v. Rathbura, 42 Mo. 694, 97 Am. Dec. 359; Peine v. Weber, 47 111. 41; Gobble v. Linder, 76 111. 157; Keeble v. Keeble, 85 Ala. 552, 5 South. 149. 11 March v. Allabough, 103 Pa. 335, where the court said, in de- termining the question: "We must consider the relation which the sum stipulated bears to the injury which may be caused by the breach provided against, the ease or difficulty of measuring a breach in damages, and such other matters as are legally or neces- sarily inherent in the transaction." See, also, Keck v. Bieber, 148 Pa. 645, 24 Atl. 170; Kunkel v. Wherry, 189 Pa. 198, 42 Atl. 112- Berry v. Wisdom, 3 Ohio St. 241; Perkins v. Lyman, 11 Mass. 76, 6 Am. Dec. 158; Lynde v. Thompson, 2 Allen (Mass.) 456, 459 Hodges v. King, 7 Mete. (Mass.) 583; Curry v. Larer, 7 Pa, 470 Colwell T. Lawrence, 38 N. Y. 71; Parr v. Village of Greenbusb, 42 Hun (N. Y.) 232; Scofield v. Tompkins, 95 111. 190, 35 Am. Rep 100. 103 PENALTIES AND FORFEITURES. (Ch. 4 have endeavored to cover up their objects under other dis- guises, courts of equity will not be deprived of their juris- diction to relieve against what is in truth a penalty. 11 If it is apparent from the intent of the parties as expressed in the contract that the word "penalty" was used where "liq- uidated damages" was intended, or, on the other hand, that the words "liquidated damages" were used where "penalty" was meant, the use of either of such terms will not control in determining the question. 18 And it has been decided in a well-considered case that, even if it were admitted as a fact that the parties intended the sum to be deemed liquidated damages, and not a penalty, the intention could have no in- fluence on the decision of a court of law. 1 * Stipulation for Nonpayment of Smaller Sum. Although the contract may not, in form, provide for the payment of money, if it, in effect, provides for such a pay- ment, and a sum is stipulated for a breach thereof, such sum is a penalty. 16 Such stipulation is a penalty not only when it provides for the payment of a larger sum on the failure to pay a smaller amount, but also where it may possibly lead to such a result. 18 Contract Providing for More Than One Thing. Where a contract provides for the performance or nonper- formance of more than one act, and the damages resulting 12 Story, Eq. Jur. 1318; Ropes v. Upton, 125 Mass. 258; Bird v. Lake, 1 Hem. & M. Ill; Howard v. Woodward, 34 Law J. Ch. 47. ! Parfitt v. Chambre, L. R. 15 Eq. 36; Fletcher v. Dysche, 2 Terra R. 32; Greeii v. Price, 13 Mees. & W. 701; Gushing v. Drew, 97 Mass. 445; Shute v. Taylor, 5 Mete. (Mass.) 61; Streeper v. Wil- liams, 48 Pa. 450; Hamaker v. Schroers, 49 Mo. 406; Little v. Banks. 85 N. Y. 266; Ward v. Building Co., 125 N. Y. 230, 26 N. E. 256; Yenner v. Hammond, 36 Wis. 277; Schotteld v. Tompklns, 95 111. 190, 35 Am. Rep. 160; Beard v. Delaney, 35 Iowa, 16; Spear v. Smith. 1 Denio (N. Y.) 464; Hoag v. McGinnis, 22 Wend. (N. Y.) 165. i Jaqulth v. Hudson, 6 Mich. 123, 136. Clement y. Cash, 21 N. Y. 253; Bagley v. Peddle, 16 N. Y. 469, 69 Am. Dec. 713; Whltfleld v. Levy, 35 N. J. Law, 149; Dakln v. Williams. 17 Wend. (N. Y.) 447; Tiernan v. Hlnman, 16 I1L 400; Pelne v. Weber, 47 111. 41; Kuhn y. Myers, 37 Iowa, 351. Spear v. Smith, 1 Denlo (N. Y.) 465; Gray y. Crosby, 18 Johns. (N. Y.) 219. 226; Curry v. Larer, 7 Pa. 470. 32) RULES AS TO LIQUIDATED DAMAGES OR PENALTY. 109 from a violation of all or each of them are uncertain as to amount, a stipulated sum. will be treated as liquidated dam- ages, for the same reasons and on the same principles as though only one provision was contained in the contract. 17 But where the sum is fixed as security for the performance or nonperformance of several acts of widely different impor- tance, damages for breaches of some of which are easily ascertained, and for any of which the sum stipulated is an excessive compensation, such sum must be regarded as a penalty. 18 In New York the principle has been deduced from the leading English cases that, where a party agrees to do several things, one of which is to pay a sum of money, and in case of a failure to perform any or either of the stipula- tions agrees to pay a larger sum as liquidated damages, the larger sum is to be regarded in the nature of a penalty, and, being a penalty in regard to one of the stipulations to be performed, is a penalty as to all. 19 It follows from the rea- soning of the New York cases that, if one of the things to be performed is of such a nature that failure to perform can be easily measured by a pecuniary standard, the same prin- ciple applies. If the contract is one in which the damages occasioned by a partial performance are ascertainable, and a sum is stipulated for a breach of the entire contract, such " Green v. Price, 13 Mees. & W. 695; Rawlinson v. Clarke, 14 Mees. & W. 187; Shute v. Hamilton, 3 Daly (N. Y.) 462; Mott v. Mott, 11 Barb. (N. Y.) 134; Lange v. Werk, 2 Ohio St. 519. is EX parte Capper, 4 Ch. Div. 724; Davles v. Penton, 6 Barn. & O. 216; Edwards v. Williams, 5 Taunt. 247; Beckham v. Drake, 8 Mees. & W. 846; Watts v. Camors, 115 U. S. 353, 6 Sup. Ct. 91, 29 L. Ed. 406; Trower v. Elder, 77 111. 452; Carpenter v. Lockhart, 1 Ind. 434; Heatwole v. Gorrell, 35 Kan. 692, 12 Pac. 135; Heard v. Bowers, 23 Pick. (Mass.) 455; Higginson v. Weld, 14 Gray (Mass.) 165; Daily v. Litchfield, 10 Mich. 29; Trustees of First Orthodox Congregational Church of Middleville v. Walrath, 27 Mich. 232; Carter Y. Strom, 41 Minn. 522, 43 N. W. 394; Moore v. Platte Co., 8 Mo. 467; Long v. Towl, 42 Mo. 545, 97 Am. Dec. 355; Whitfield v. Levy, 35 N. J. Law, 149; State v. Dodd, 45 N. J. Law, 525; Jackson v. Baker, 2 Edw. Ch. (N. Y.) 471; Niver v. Rossman, 18 Barb. (N. Y.) 50; Staples v. Parker, 41 Barb. (N. Y.) 648; Beale v. Hayes, 5 Sandf. (N. Y.) 640; Barry v. Wisdom, 3 Ohio St. 241; Shreve v. Brereton, 51 Pa. 175; March v. Allabough, 103 Pa. 335. i Cotheal v. Talmage, 9 N. Y. 551, 556, 61 Am. Dec. 716; Lamp- man v. Cochrau, 16 N. Y. 275; Clement v. Cash, 21 N. Y. 253. 110 PENALTIES AND FORFEITURES. (Ch. 4 sum will not be allowed as liquidated damages in case of such partial performance ; 20 as, where a contract is made for the sale and delivery of a specified commodity in certain quanti- ties at different times, for a breach of which a lump sum is stipulated to be paid, the sum must be considered as a pen- alty, for otherwise the vendor might be required to pay as much for a partial failure to perform his contract as though he had made no effort to fulfill. 21 In such cases, as in all cases involving a consideration of this question, if it is ap- parent that the parties have abandoned the fundamental guide of compensation, and have applied an unjust, oppres- sive, and disproportionate measure of damages, the courts will not allow the intention of the parties to prevail. ENFORCING FORFEITURES. 83. Equity will not lend its active aid to enforce a forfeiture. This rule rests on the maxim that he who comes into equi- ty must do equity, and must come with clean hands. Equity will therefore withhold its aid from one insisting on the harsh remedy of forfeiture for a condition broken, since eq- uitably he is entitled only to just compensation for his in- jury, and he will be remitted to his legal remedies. 1 o Heatwole v. Gorrell, 35 Kan. 692, 12 Pac. 135; Watt's Ex'rs v. Sheppard, 2 Ala. 425; Shute v. Taylor, 6 Mete. (Mass.) 61; Ham- aker v. Schroers, 49 Mo. 406. 21 Shreve v. Brereton, 51 Pa. 175; Lee v. Overstreets Adm'r, 44 Ga. 507; Hamaker v. Schroers, 49 Mo. 406. 33. i Douglas v. Insurance Co., 127 111. 101, 20 N. B. 51; Craig T. Huklll, 37 W. Va. 520, 16 S, E. 363; Birmingham v. Lesan, 77 Me. 494, 1 Atl. 151; Mills v. Seminary, 52 Wls. 669, 9 N. W. 925; Mc- Cormlck v. Rossi, 70 Cal. 474, 15 Pac. 35; Livingston v. Tompklns, 4 Johns. Ch. (N. Y.) 415, 431; Melgs' Appeal, 62 Pa. 28, 35; Oil Creek R, Co. v. Railroad Co., 57 Pa. 65. 34) EQUITY WILL RELIEVE AGAINST FORFEITURES. Ill WHEN EQUITY WILL BELIEVE AGAINST FORFEI- TURES. 34. Equity will relieve against a forfeiture in all cases where it is incurred by a breach of an express agreement to pay a sum. of money, or any other agreement which in- volves indirectly the payment of a sum of money. It is generally stated that relief against forfeitures is af- forded on the same grounds and in the same cases as relief against penalties. This statement is subject to qualification, for equity will not relieve against forfeitures in all cases where compensation can be made. There are many for- feitures incurred by the breach of covenants in leases and other strict contracts, where compensation can easily be made, against which equity will not relieve ; * as, where a contract for the sale of land is so drawn that the time of pay- ment is the essence of the contract, equity will not relieve against the default of the vendee; and when such contract is made to depend upon a condition precedent as the pay- ment of the consideration by the vendee before performance by the vendor equity will not relieve against a forfeiture oc- casioned by a nonperformance of the condition precedent. 2 Nor will equity relieve against a forfeiture for the breach of a covenant contained in a lease, other than one to pay rent, unless on the ground of accident, mistake, or fraud; for it has been considered that, even where the damages are ca- pable of being ascertained, the jurisdiction of equity in giv- ing relief in such cases is a dangerous jurisdiction, and rarely 84. i Eaton v. Lyon, 3 Ves. 692, 693; Germantown Passenger Ry. Co. v. Fitter, 60 Pa. 131; Dunklee v. Adams, 20 Vt 415. 2 Wells v. Smith, 2 Edw. Oh. (N. Y.) 78; Wells v. Smith, 7 Paige (N. Y.) 22, 31 Am. Dec. 274; Edgerton v. Peckham, 11 Paige (N. Y.) 362; Sanborn v. Woodman, 5 Oush. (Mass.) 36; Remington v. Irwin, 14 Pa. 143, 145; Clark v. Lyons, 25 111. 105; Snyder v. Spaulding, 57 111. 480, 482. 112 PENALTIES AND FORFEITURES. (Ch. 4 works a real compensation. 8 But where a person has been prevented from executing an agreement by fraud, accident, surprise, or excusable ignorance, equity will relieve against a forfeiture, even if the damages resulting from the breach cannot be measured by a pecuniary standard. 4 STATUTORY PENALTIES AND FORFEITURES. 36. The jurisdiction of equity to relieve against penalties and forfeitures does not extend to those imposed by statute. 1 Statutory enactments are binding on all courts, and courts of equity are powerless to set them aside. The distinction between penalties and forfeitures imposed by contract and those imposed by statute has always been observed. As Lord Macclesfield, in the leading case on this subject, said : "You can never say that the law determined hardly, but you may say that the party has made a hard bargain." 2 It has even been held that a statutory penalty will be enforced by a court of equity if the case is properly before it.' Smith, Eq. (15th Ed.) p. 335; Gregory v. Wilson, 9 Hare, 689; Nokes v. Gibbon, 3 Drew. 681; Bracebridge v. Buckley, 2 Price, 215. * Eaton v. Lyon, 3 Ves. 693; Hill v. Barclay, 18 Ves. 58, 62; Noyes v. Anderson, 124 N. Y. 175, 26 N. E. 316; Kopper v. Dyer, 59 Vt. 477, 9 Atl. 4; Mactier v. Osborn, 146 Mass. 399, 15 N. E. 641; Hulett v. Fairbanks, 40 Ohio St. 233. 35. i Clark v. Barnard, 108 U. S. 436, 457, 2 Sup. Ct 878, 27 L. Ed. 780, and cases cited; State v. McBride, 76 Ala. 51; Keating T. Sparrow, 1 Ball & B. 373. Peachy v. Duke of Somerset, 2 White & T. Lead. Cas. Eq. 1253. State v. Hall, 70 Miss. 678, 13 South. 39. Contra, Broadnax v. Baker, 94 N. C. 675, 65 Am. Rep. 633. 36) PRIORITIES AND KOTICK. 113 CHAPTEB V. PRIORITIES AND NOTICE. 88. Origin and Application of Doctrine of Priority. 87. Doctrine Does Not Apply to Legal Estates. 38. Equal Equities. 39. Where One of the Parties Has the Legal Estate. 40. Superior Equities. 41. Superiority of Estate Created by Trust or Contract 42. Equity in Specific Thing. 43. Equity of Party Misled, 44. Notice of an Equity. 45-46. Notice Definition. 47-49. Kinds of Notice. 60. Actual Notice. 51. Constructive Notice. 52. Possession as Constructive Notice. 53. Constructive Notice by Registration. 54. Recitals in Title Papers. 65. Lls Pendens. ORIGIN AND APPLICATION OP DOCTRINE OP PRI- ORITY. 36. The doctrine of priority rests on the equitable maxims: "Where the equities are equal, the first in time will prevail," and, "Where the equities are equal, the law must pre- vail." The meaning and effect of these maxims have been ex- plained in a preceding chapter. 1 Both are based upon the assumption that the equities, the priorities of which are to be determined, are equal. If they are unequal, the superior eq- uity must, of course, prevail, and they are not affected by the order of time. As a result of the application of the sec- ond maxim, if there be annexed to one of two equal equities in an estate, the legal title thereto, the person acquiring such f 86. t Ante, 17, 18. EATON.EQ. 8 114 PRIORITIES AND NOTICE. (Ch. 6 legal title will have a priority of claim over a person having a bare equity in the estate. DOCTRINE DOES NOT APPLY TO LEGAL ESTATES. 87. The equitable doctrine of priority, as affected by lack of consideration, absence or pres- ence of notice, or other incident, excepting order of time, does not apply to legal es- tates and interests. At law, priorities were determined almost exclusively by order of time. The equitable doctrine of priority, as affected by want of consideration, presence or absence of notice, or any other incident cognizable in equity, but not at law, had no place in the administration of the common law, unless expressly provided by statute. At law, the equities vested in either of the parties to a controversy do not influence the determination of the rights of such parties, which depend for their priority exclusively upon the order of time; as, when a legal conveyance of property is made, the grantor has no right remaining in such property which he can trans- fer to another, and the first conveyance has precedence over any subsequent conveyance, even if the subsequent grantee had no notice of the prior conveyance. 1 Even the absence of a valid consideration does not affect priority at law, except where it is otherwise provided by statute.* The equitable doctrine of priority is applicable to equitable estates, rights, 37. i Gaiiies v. City of New Orleans, 6 Wall. 642, 716. 18 L. Ed. 950; Ruckman v. Decker, 23 N. J. Eq. 283; Van Amrlnge v. Morton, 4 Whart. (Pa.) 382; Wade v. Withlngton, 1 Allen (Mass.) 5G1. 2 Statutes have been passed In England (27 Ellz. c. 4; 13 Ellz. c. 6) and In the states of this country declaring Invalid transfers of land and other property made for the purpose of defrauding cred- itors, and providing that grants of lands made for the purpose of defrauding subsequent purchasers for a valuable consideration are void as against such subsequent purchasers. See Tey's Case, 3 Coke, 80; Twyne's Case, 1 Smith, Lead. Cas. Eq. (8th Am. Ed.) 33; Sexton v. Wheaton, 8 Wheat 229, 5 L. Ed. 603. 38) EQUAL EQUITIES. 115 and remedies, and to conflicting legal and equitable estates and interests in the same subject-matter.* EQUAL EQUITIES. 38. Order of time controls in all cases where the parties have equal equitable interests in the same subject-matter, and are all entitled, with respect to such interests, to the pro- tection and aid of a court of equity. This rule is merely an amplification of the maxim, "Where the equities are equal, the first in order of time shall pre- vail." It is difficult to lay down a rule that can be univer- sally applied in determining what are equal equities. They may not be of precisely the same nature, and yet be equally entitled to the protection of a court of equity. 1 But it may be stated as generally true that, if the equities of the parties are such that each is equally entitled to the aid and protection of a court of equity, their equities are equal, and the first in order of time must prevail.' The fact that the party pos- sessing the subsequent equity had no notice of the prior one Bassett v. Nos worthy, Finch, 102; I