in order to raise the 20007., sold out stock, the dividends of which exceeded the interest payable on the 2000l., it was subsequently agreed, that in consideration of the creditor letting the 20007. remain secured at interest as aforesaid, the debtor would when requested pay to the creditor the value of the stock sold out, or transfer such amount of stock to him, and in the mean time pay the amount of the dividends instead of the interest of the 20007.; it was held, that the agreement gave the creditor the option of the stock or the 20007., and was, therefore, usurious. The Master of the Rolls in Barnard v. Young, distinguished that case from the case of Forrest v. Elwes (1), which had been heard before Lord Alvanley, and the ground of distinction taken by the Master of the Rolls was, that in Forrest v. Elwes there was no option. In that case it appeared, that Mr. Elwes had in the year 1766 lent Commodore Forrest 80007. Old South Sea Annuities, valued on the day of transfer at 71702. The condition of the bond was, that Forrest should, at the end of six months, retransfer the 80007. stock, and pay interest at five per cent. on the 7170l. Breach was made by Forrest in the condition of the bond by non-transfer of the stock within the six months, and a long period elapsed, during which part of the principal was discharged, but a great arrear of interest occurred on the residue. After the death of Forrest a suit was instituted in equity by his executors, in which Elwes was a defendant, and it was directed that the balance due to Elwes should be paid, and that the Master should take an account of the money due. In the year 1798 the Master reported that 65001. was due for principal, with a very large sum for interest. It was objected on the part of the executors, that the Master ought to have reported that so much was due as would purchase 8000l. South Sea Annuities, when the same might be purchased at some given period of time, after deducting the several sums already paid on the bond. On the other hand it was contended, that Mr. Elwes was entitled to the residue of the 71707. The Master of the Rolls said, the question was, what was the fair measure of the damage? and asked, whether he should do justice in giving the same annuities, which were formerly worth eighty-nine per cent., and were then much depreciated? and he overruled the exception. Now it is with much deference suggested, that the effect of this decision was, after the expiration of the six months, to remove from Mr. Elwes the hazard alluded to in Barnard V. Young, and to give him the same chance of rise without the risk of fall which vitiated the transaction in that case; unless it be supposed that if after the expiration of the six months, the stock had risen in value, Mr. Elwes would not have been entitled to the advantage of the rise, but have been kept to the 71707, which it seems difficult to conceive, for under such a determination Mr. Elwes would have sustained an actual loss through the default of the borrower.

There is also a case (m) heard in the King's Bench, which appears at variance with the principle before stated. The circumstances were; that the defendant Wellings applied to the plaintiff's testator to advance him a sum of money, which was agreed to, but the testator said he should expect the same interest which he received in the short annuities, namely, eight and a half per cent. To this the defendant

Forrest v. Elwes, 4 Ves. jun. 492. (m) Tate v. Wellings, 3 T. R. 537,

assented. The money was accordingly raised by the testator by sale of short annuities, and the agreement was, that the defendant should replace the stock by the first day of September, 1785; but if it was not replaced by that time, then he should repay the money raised on the 1st of January, 1786; and in the mean time should pay such interest as the stock would have produced. On the trial Lord Kenyon left it to the jury to say, whether this was intended as a bonâ fide loan of stock to be replaced at a subsequent time, or repaid in money; or whether it was intended to be a loan of money, and the present device a mere colour for usury; the jury found it a mere loan of stock, and gave the plaintiff a verdict. A rule was afterwards obtained to shew cause why the verdict should not be set aside, and a new trial granted on the ground of usury, and it was argued that a contract for a loan of stock to be replaced on a given day, or to be repaid in money, reserving a greater interest than the law allows, in other cases was clearly usurious. The Court considered that they were precluded by the verdict of the jury from considering whether the transaction was a mere cloak for usury. Lord Kenyon thought, that as the transaction was legal during the first year, there was nothing superadded to make it usurious. Mr. Justice Ashhurst thought, that from the contract the creditor derived no advantage, for he was only to receive in the mean time the same interest which the stock would have produced; and Mr. Justice Buller said this was not like the case cited from Cro. James (n), where the principal was always secure, for here the testator might have been a loser in the event of the stock rising after the first year. A new trial was therefore

refused.

On consideration of the foregoing case, it is submitted, that the opinion given by Lord Kenyon, viz., that there was nothing superadded after the first year to make the transaction usurious, appears singular, considering that it was an agreement to repay a sum of money with eight and a half per cent. interest. The reason given by Mr. Justice Ashhurst is yet more remarkable, for it would seem to imply that an agreement to repay money raised by the sale of stock would not be usurious, if the rate of interest did not exceed the dividends of the stocks sold. The reasoning of Mr. Justice Buller, namely, that the lender ran the hazard that the stock might rise after the year, would apparently apply to any loan of money raised by the sale of stock.

A lending of stock, on an agreement to take it at more than the market price, is clearly usurious.

In a case where A., one of three partners, advanced to the concern large sums of money raised by the sale of stock, and on his retirement from the partnership, 20,000% three per cent. consols were due to him, which, by the deed of dissolution, it was agreed should be replaced in four instalments by the two remaining partners; and the first instalment of 5000l. having been replaced, and default made in replacing the second, it was agreed by parol, that the transaction should be considered a loan of money from the first, and that the sum originally produced by the sale of the stock, which was 10,0837., should be the debt, and carry interest at 57. per cent., the price of a like sum of stock then being 84377. It was held to be an usurious agreement (o). In

(n) Roberts. Trenayne, Cro. Jac. 507. (0) Parker v. Ramsbottom, 3 B. & C. 257.

other words, when stock, or the produce of the sale of stock, has been lent under an agreement that it shall be replaced, the parties cannot subsequently agree, on a fall in the price of stock, that the loan of stock shall be converted into a loan of money at the sum at which the stock was originally sold out.

During the late war, when the price of stock was so low as to render more than 57. per cent. interest, mortgages of stock were frequent, and almost superseded money mortgages; they have now nearly disappeared. The most prudent course in such species of mortgage is, to make the land redeemable on the replacing of the stock on a given day, and payment of dividends in the mean time. The cases, however, seem to imply that it will not be unlawful to stipulate for the retransfer of the stock, and to reserve five per cent. on the amount of the money produced by the sale, instead of the dividends, but the lender cannot be advised to rely on the case of Tate v. Wellings, as an authority for the proposition, that he may stipulate for the retransfer of stock at a given day, and in default of transfer, then for the payment of the amount of the money produced by the sale, and reserve a rate of interest equal to the dividends. The case of Forrest v. Elwes may be considered as decided on the particular circumstances of hardship attending the case, and not as an authority for a general rule, that under a similar proviso, the Court of Chancery would decree a redemption on payment of the money instead of the transfer of stock, in order to save the lender from a loss; and it may be concluded from the case of Barnard v. Young, that the lender must not reserve to himself an option to require the transfer of stock, or payment of the money (p); and from the case of Parker v. Ramsbottom, that a loan of stock cannot, on a fall of the funds, be converted into a loan at the original price of the stock.

The late act of the 2 & 3 Vict. c. 37, which exempts all contracts for the loan or forbearance of money above 10l. (not secured upon land), from the operation of the usury laws, and which has been construed not to be limited to contracts arising on bills or promissory notes (q), seems to have rendered the consideration of the above points unnecessary where land is not the security for the loan.

If stock is itself made the security for money, and the day appointed for payment is passed, the mortgagee may at once proceed to sell the stock, and repay himself principal and interest, without any authority from the mortgagor, and without filing his bill of foreclosure (r). But the mortgagee will be decreed to account for the surplus (s). He may, however, foreclose if he prefer it, and that too, although an express power of sale is given him by the mortgage deed, and whether his interest be legal or equitable (t).

(p) For a precedent of a mortgage of stock, see Appendix.

(q) Vide infra, Interest. Turquand v. Mosedon, 7 Mees. & W. 504. Pennell v. Attenborough, 4 Q. B. Rep. 868.

(r) Tucker v. Wilson, 1 P. Wms. 261. Lockwood and Others v. Ewar, 2 Atk. 303. (s) Harrison v. Hart, Comyns, 393. Nota. The circumstances of this case form a striking proof of the extent of

the South Sea bubble, for it appears that 20,000l. South Sea stock was transferred as a security for 70,000l. money and interest, and that the 20,000l. South Sea stock actually produced the sum of 86,2917. 17s. 83d. By the deposition of one witness, Hart agreed to sell him 1000l. South Sea stock at 1000l. per cent. premium.

(t) Slade v. Rigg, 3 Hare, 35.

CHAPTER XIX.

OF LIENS IN GENERAL.

MENTION has been already made of that particular branch of lien which is confined to equity, and relates to real estate (a). In the present chapter we will consider the subject of liens more generally.

Lien may subsist both at law and in equity, although there are some liens which subsist in equity only (b).

Liens are general or specific. By the common law, every one has a lien on a specific article delivered to him to work on for the amount of the labour done on the article (c), whether the price be fixed by contract or not (d); and this has been extended to give a certificated conveyancer or special pleader a lien on the papers in his hands, so far as respects his costs on that particular account (e). But in such a case the work must be done on the papers, so as to give the additional value, and not merely be done with and in respect of those papers, and such a plea was in a late case held bad (ƒ). So an auctioneer to whom a mortgage deed has been delivered to obtain payment of the principal and interest due upon it, has no lien upon the deed for his charges for making application for such payment, upon the ground that there is no work done upon the subject-matter in dispute (g). So there is no such lien for agistment (h).

The right to this lien, too, does not exist where, by express contract, or from the nature of the contract, the bailor retains rights inconsistent with the lien, as in the case of horses put at livery, where, by the nature of the contract, the possession is to be redelivered to the owner whenever he may require it (i). So where milch cows are agisted (k); and the same seems to apply to racers in the hands of a training groom, unless delivered to be trained for running a particular race (1); but it has been decided that this lien may co-exist with an express contract as to the price, unless such contract contain a time or mode of payment inconsistent with the implied lien, and is not confined to those cases

(a) Vide Bk. 2, Ch. 14. (b) 2 Mer. 403.

(c) Scarfe v. Morgan, 4 Mees. & W. 270; and as to what amounts to waiver of such a lien, vide White v. Gainer, 2 Bingh. 23. Boardman v. Sill, 1 Campb. 410.

(d) Chase v. Westmore, 5 M. & S. 180.

(e) Hollis v. Claridge, 4 Taunt. 807. (ƒ) Steadman v. Hockley, 15 Mees. &

W. 553.

(g) Sanderson v. Bell, 2 C. & M. 304. (h) Chapman v. Allen, Cro. Car. 273. Jackson v. Cummings, 5 Mees. & W.

342.

(i) Judson v. Etheridge, 1 C. & M. 743.

(k) Jackson v. Cummings, supra. (1) Vide the remarks of Parke, B., in Jackson v. Cummings, supra, and in Scarfe v. Morgan, 4 Mees. & W. 284.

where there is no manner of contract between the parties, except such as the law implies (1).

The right to redemand the thing bailed, and the right to recover payment for the work done upon it, being contemporaneous, the locator operis (the employer of the artisan), has no right to redemand possession from the conductor operis (the artisan), without paying or tendering the amount due for the work. This appears to be the real character of that which for the sake of brevity is called a lien at common law; and, therefore, where there is a specific agreement fixing the time of payment to a particular period, the lien does not in general attach (m), because inconsistent with the right of intermediate delivery (n).

On the principle of labour employed upon the subject-matter, it seems that an accountant has a lien as against the assignees in bankruptcy upon books intrusted to him for examination and arrangement by a trader before his bankruptcy (o). This species of lien, however, does not extend to general balances or money due on former or different accounts (p), though such a claim is not a waiver of the lien that the party is entitled to (q).

A lien on goods is a special property sufficient to support the affirmative in an interpleader issue between the party entitled to the lien and the execution creditor of the owner of the goods, whether the former had any property in the goods as against the latter (r); indeed any person having the right of possession of goods may bring trover in respect of the conversion of them, and allege them to be his property (s). So a lien is admissible as a defence under a plea denying property in the plaintiff, and need not be specially pleaded (t). And a lien under an agreement that a creditor shall hold a particular chattel until the debt is paid, is not lost by a wrongful removal of the thing without the consent of the creditor, who may seize again (u). But the case referred to seems rather the case of a pledge than a lien.

The cases turn principally on the point, whether the lien is confined to the particular transaction, or is extended to the general balance? Lord Mansfield has stated (w), that the convenience of commerce and natural justice are on the side of liens, and that therefore, of late years, Courts have leant that way :-first, where it is an express contract; secondly, where it is implied from the usage of trade; or thirdly, from the manner of dealing between the parties on the particular case; or, fourthly, where the party has acted as factor. It may not be improper briefly to consider the doctrine under these several divi

sions:

First: In the case of an express contract. The Court of King's

(1) Chase v. Westinore, 5 M. & S. 180; et vide infra.

(m) See Norris v. Williams, 1 C. & M. 842, note to Barnett v. Brandao, 6 M. & G. 658.

(n) Vide 4 M. & W. 284; 5 M. & S.

186.

(0) Ex parte Southall; In re Hill, 17 L. J., Bankr. 21, N. S.

(p) Ex parte Ockenden, 1 Atk. 285.

(2) Scarfe v. Morgan, supra.

Rogers v. Kennay, 9 Q. B. 592, the lien in this case was however by agreement.

(s) Per Parke, B., in Legg v. Evans, 6 Mees. & W. 41.

(t) Richards v. Symons, 8 Q. B. 90. (u) Ibid. There was however in this case a special agreement to this effect. (w) 4 Burr. 2221.