Sec. 39. When injunction will issue to restrain sales under powers.

Sec. 40. Surplus-To whom distributed-Rights of debtor and subsequent lienholders.

SEC. 14. Who must execute the power-Acceptance and resignation of trusts-Death of trustee or donee of power.-Where the power of sale is executed by the person named, no question can arise. Questions more frequently occur where vacancies have been occasioned by removal, death, resignation, or refusal to act.

The law will not compel any person to accept the office of a trustee; and before acceptance, he may refuse or disclaim the office at will. But after acceptance (which may be shown by any evidence showing his assent to the trust: supra, sec. 6), he cannot resign or lay it down without the assent of the beneficiary or the decree of a Court of equity: Drane vs. Gunter, 19 Ala. 731; 3. Yerg. 257. And will be compelled to concur in ministerial acts requisite for the proper discharge of the trust: Hill on Trust. 307, 545, 551; 21 Ill. 148.

A naked power to sell, not coupled with an interest, must be executed by all, and does not survive. But when coupled with an interest or a trust (see sec. 9, supra), it does survive; and if a portion of the trustees renounce or refuse to execute the trust, or from any cause be duly discharged under a power in the deed or under a decree of Court, the legal title to the estate, as well as the office of trustee, will devolve upon the others who do accept the trust, and these may execute it: Williams vs. Otey, 8 Humph. 562; 2 Id. 367; Hill on Trust. 175; 3 Paige 420. If all decline but one, he may execute it: Taylor vs. Benham, 5 How. (U. S.) 233; Scull vs. Reeves, 2 Green Ch. 84. So on the death of part of the trustees, the survivors take the entire legal estate, and may execute the trust. And this though it is not expressly so provided in the deed: Hannah vs. Carrington, 18 Ark. 104; Parsons vs. Boyd, 20 Ala. 118; 12 Ala. 672; 10 Peters 532; Franklin vs. Osgood, 14 Johns. R. 527. On the death of the last trustee, his interest vests in his executor or heir, according to the nature of the property: in the heir, if real property, in the executor, if personal estate. And this although the statute may give to the Courts

a cumulative right to appoint trustees in the place of those deceased. Mauldin vs. Armistead, 14 Ala. 708, and cases; Hill on Trust. 175.

On the death of the trustee named, a substituted trustee does not take the legal estate, but it passes, according to the opinion of the Supreme Court of the United States, to the heirs at law of the first trustee, and hence, such heirs must be parties to proceed ings in Court relative to the execution of the trust and the conveyance of the estate: Greenleaf vs. Queen, 1 Peters 138. Other Courts hold that on the appointment of a new trustee (even where the statute and decree making the appointment are silent as to any change or transfer of the title), the title or estate vests by implication in the new trustee appointed by the court, so as to enable him to perform the trusts: Woolridge vs. Planters' Bank, 1 Sneed 297; Goss vs. Singleton, 2 Head 67; Gibbs vs. Marsh, 2 Met. 243, 253; Duffy vs. Calvert, 6 Gill 487.

If the power of sale is given to the creditor, "his administrators and assigns," the power, not being destroyed by death of the donee thereof, may be carried into effect by his administrator: Doolittle vs. Lewis, 7 Johns. Ch. 45; Turner vs. Johnson, 7 Ohio. 216, 220, part 2; Collins vs. Hopkins, Adm'r., 7 Iowa 463; supra, sec. 9. And if the mortgagee, in such a case, dies non-resident, his administrator, by virtue of his foreign appointment, may legally execute the power of sale: Doolittle vs. Lewis, supra. The administrator of mortgagee may sign notices of sale: 4 Minn. 25.

The power of sale, being an irrevocable part of the security (supra, sec. 9), is not destroyed by an assignment of the debt, but the benefit of the power passes to the assignee, who has a right to call upon the trustee to sell. If part of the notes are assigned, the security passes pro tanto: Sargent vs. Howe, 21 Ill. 148; Keyes vs. Wood, 21 Verm. 331, 550; 20 Ill. 162; 1 Paige 48; 11 Iowa 211; Id. 580; Anderson vs. Bumgartner, 27 Mo. 80, where nature of assignee's interest, and how it may be lost, are discussed; Wood vs. Snow, 1 Mich. 128; 29 Miss. 46; 4 Kent's Com. 147; Slee vs. Manhattan Company, 1 Paige 48. See Wilson vs. Troup, 2 Cow. 195; s. c., 7 Johns. Ch. 25, holding that partial assignee

of mortgagee with power of sale, cannot sell, the power being indivisible.

SEC. 15. When all the trustees must concur.—Where no different provision is made by the author of the trust, the general rule is that all the trustees must join in executing the trust; but not, of course, those who have renounced or been discharged. The concurrence of a co-trustee is, however, sometimes presumed: Vandever's Appeal, 8 W. & S. 405; Hill on Trust. 305, et seq., and note. When concurrence is necessary, or otherwise, see, in addition, 9 Sm. & Mar. 339; 13 Id. 597.

Where empowered to act separately, yet if they elect to act jointly, as by giving a joint notice of sale, one cannot afterwards deny the authority of his co-trustee, and act alone, certainly not where there is no room to presume the concurrence of the cotrustee White vs. Watkins, 23 Mo. 423. The power to sell must be pursued with precision. And the rule may be stated generally thus where the act to be done requires discretion, or joint deliberation, or united judgment, all must act, unless otherwise specially provided. It was accordingly held in Powell vs. Tuttle, 3 Comst. 396, overruling King vs. Stone, 6 Johns. Ch. 323, where loan commissioners were authorized to advertise and sell on default, that a sale by one (there being no provision that a less number might act), without the presence and concurrence of both, was for that reason void, and not capable of being rendered valid by a conveyance in which both commissioners subsequently unite. See, also, Sherwood vs. Reade, 7 Hill 431; Vandever's Appeal, 8 W. & S. 405.

SEC. 16. New trustees, how created—by chancery and under the power. When, from any cause, a vacancy in the office of a trustee occurs, it may be filled, 1st. By the appointment of a Court of Chancery; 2d. Under a power contained in the trust instrument. Where the trustees named die, neglect or refuse to act, or remove from the State, or from any cause, such as lunacy (2 Barb. Ch. 381), confirmed intemperance (1 Halst. Ch. 513), become incapable of acting, or where they have been guilty of breaches of trust, or have combined to defraud the creditor, Courts of equity freely

exercise their jurisdiction to appoint new trustees: White vs. Hampton, 10 Iowa 238; Gale et ux., R. M. Charlt. 109; 3 Green Ch. 13; 2 Story Eq. 527; Lewin on Trust. 597; Gamble vs. Dabney, 20 Texas 69; 14 Ala. 708; Drane vs. Gunter, 19 Id. 731; Cullum vs. Bank of Mobile, 23 Id. 797; Hill on Trust. 191, note and cases; 2 Bland Ch. 167, 322, 434; Sturges vs. Knapp, 31 Verm. 1. Or will compel the trustees named to proceed and sell: Sargent vs. Howe, 21 Ill. 148; Hill on Trust. 307.

If there is a power contained in the trust instrument authorizing it, new trustees may be created or appointed by those persons or officers to whom the power is expressly given, and in the manner therein pointed out, but not otherwise.

In many instruments which have fallen under our observation, the power of appointment in case of the death or refusal of the trustee to act, is conferred upon the county or probate judge, or some other permanent officer. Where the power exists, and is properly exercised, the appointment is valid, even when made by the creditor himself. The designated mode must be followed; but it is sufficient if the intent of the author of the power is fairly executed. Thus, where creditors have the power to substitute a trustee, and are not required to unite in the same instrument, they may make the appointment by separate instruments, executed at different times, if this does not contravene any expressed intent of the grantor: Crosby vs. Huston, 1 Texas 225. So if the deed gives the cestui que, trust power, on the failure or refusal of the trustee to act, to appoint another, without requiring it to be in writing, such appointment, where the property to be sold is personal, may be by parol; and where the debts are due in instalments, the power is not exhausted by one appointment: Foster vs. Goree, 4 Ala. 440.

SEC. 17. Liability for acts of co-trustee. This liability is not so stringently enforced in this country as it would seem to be in England. In the absence of agreement or fraud, one trustee is not generally liable for the act of his co-trustee. In a case arising under an instrument such as we are now considering, C. J. MARSHALL stated the rule in this wise:-In a fair, regular transaction

one trustee is not liable for money received by his co-trustee merely because he joined in the receipt. But if the transaction is not fair and regular, as where the trustee who receives the money had no right to receive it, the co-trustee who joins in the receipt and thus co-operates in a breach of the trust, will be liable for the failure of the trustee thus receiving it to pay it over to the beneficiary.1 Wallis vs. Thornton, 2 Brockenb. 422; 2 Ala. 86.

The rule as stated by Mr. Story (Eq. Jurisp. sec. 1280) is very generally followed. This subject not being entirely within the scope of this article, we refer generally for full discussion both as to directory and discretionary trusts, to Tounsley vs. Sherburne, 2 Lead. Cas. Eq. 306; Wharton's note to Hill on Trust. 309; Deaderick vs. Cantrell, 10 Yerg. 263; McMurray vs. Montgomery. 2 Swan 374; 1 H. & G. 11; 7 Gill & J. 157; 3 Gill 366; Griffin vs. Macaulay, 7 Gratt. 476; Worth vs. McAdden, 1 Dev. & Batt. (Eq.) 199.

SEC. 18. Compensation of trustees, and who liable therefor.While the subject of the compensation of trustees does not strictly come within the purpose of this article, a brief reference to some of the cases arising under deeds of trust may be useful. If the instrument provides for compensation, that governs. But if no such stipulation is made, the trustee is not entitled to compensation for responsibility assumed or to commissions for making sale. He will be allowed necessary expenses, including in proper cases attorney's fee, auctioneer's and clerk's hire, but the court will guard the fund with jealous care even as to thesc: Constant vs. Matteson, 22 Ill. 546; Allen vs. Robbins, Am. L. Reg., Vol. 2 (N. S.) 442.

Where the trust deed provided no compensation, and the trustee performed no service and the debtor voluntarily paid the debt, the

1 As to liability to beneficiary, see generally, Lewin on Trusts, 2 Law Lib. 186. If the trustee in making the sale is guilty of a flagrant breach of trust, and the property is sold to a third person bona fide, the trustee may be charged with the full value of the property sold. Hunt vs. Bass, 2 Dev. (Eq.) 292; Johnson vs. Eason, 3 Ire. (Eq.) 330.

Liability of mortgagee to debtor for improper exercise of the power to sell, see infra, Sec. 20 and note.