In Colclough v. Evans, 4 Sim. 76, it was decided that, after an original bill is at issue, as by the New Orders a plaintiff cannot amend without special application, so he cannot file a supplemental bill for the purpose of putting in issue, and obtaining a discovery of facts and documents, which might have been introduced by amendment *529] into the original *bill, although the supplemental bill alleged that those facts and documents were not known to the plaintiff till after the original suit was at issue; but a demurrer to such a bill was allowed without prejudice to a special application to withdraw replication and amend the bill.

In Crompton v. Wombwell, 4 Sim. 628, it was decided that if a plaintiff, when his cause is in such a state that he cannot amend his bill, discovers new matter which may tend to show that he is entitled to the relief prayed by his bill, he may file a supplemental bill for the purpose of putting in the new matter in issue, and a demurrer put in to a bill so framed was overruled.

As a plaintiff is, under the General Orders, at liberty to apply specially to amend his bill after the cause is at issue, the necessity for filing a supplemental bill for the purpose of introducing matter which might form the subject of amendment appears no longer to exist.

New assignees on filing a supplemental bill are entitled to the benefit of former proceedings in a suit commenced by the old assignees.(1)

CHAPTER XI.

BILL OF FORECLOSURE.

Where a bill of foreclosure may be filed, 530. Parties to, 531.

Receiver where appointed in, 531. Injunction when granted in, 531. Decree in, 532. Decree in suit by first mortgagee against second mortgagee and mortgagor, 533. By second mortgagee against mortgagor, and first and third mortgagees, 534. If mortgagee in possession, 535. Priority of incumbrancers, 536. Decree in, against an infant or married woman, 537. Proceedings under decree, 538. Taking account between mortgagor and mortgagee, 539. How foreclosure made absolute, 540. Enlarging the time for paying mortgage money, 540. How subsequent interest computed, 541. Remedies of mortgagee after foreclosure, 541. Reference under statute, 543.

Ir a mortgagee is desirous of being repaid his principal and interest, and the mortgagor refuses, unless the deed contains a power of sale, the remedy of the mortgagee is either to file a bill in Chancery for a foreclosure, or for a sale; or to bring an action at law under the covenant, or upon the bond, if one was given as a collateral security.[a] The pendency of a bill of foreclosure does not prevent the mortgagee from bringing an action at law, at the same time.(1)[6] But he cannot file a bill of foreclosure till the

(1) Booth v. Booth, 2 Atk. 343.

[a] It would be impossible, without swelling this note to an unreasonable extent, to review the doctrine of foreclosure, as it exists in this country. The student is referred for a full and elaborate examination of the subject, to 4 Kent's Comm. 180-196; 2 Story's Eq. Jur. 270-301.

Nor will it be attempted in the annotations to this chapter, to follow the practice as laid down in the text, and assimilate it to that of any of the states of the Union. In some of them, it will be seen, the common law foreclosure exists, but in the most of them it is a subject of statutory regulation. Some of the principles, however, which are laid down in the text, will be noticed, and the leading cases bearing upon them, in this country, referred to.

[6] Burnell v. Martin, Doug. 417; Schoole v. Sall, 1 Sch. & Lefr. 176; Dunkley v. Van Buren, 3 Johns. Ch. Rep. 330; Hughes v. Edwards, 9 Wheat. 439; Hatfield v. Kennedy, 1 Bay, 501. If the mortgagee proceeds to judgment and execution at law, upon his bond, and sells the land mortgaged to secure the bond debt, he sells only the equity of redemption, and he may afterwards maintain ejectment against the purchaser of the premises, in order to enforce payment of the balance. Jackson v. Hull, 10 Johns. 481; M'Call v. Lenox, 9 Serg. & R. 307. See also, Heyer v. Pruyn, 7 Paige, 465. This supposes the case, that the purchaser at the sheriff's sale, knew of the existence of the mortgage, and purchased subject thereto. But the rule is not uniform on the subject. In Pennsylvania, it has been frequently held, that the purchaser will hold the land, discharged of the lien of the mortgage. McGrew v. McLanahan, 1 Penn. Rep. 44; Pierce v. Potter, 7 Watts, 475.

There are, however, difficulties attending the sale of the equity of redemption by the mortgagee, by execution at law; and it is accompanied with danger to the rights of the mortgagor; and these difficulties were suggested by Chancellor Kent, in the case of Tice v. Annin, 2 Johns. Ch. Rep. 125, and that the proper remedy was, to prohibit the

mortgage is forfeited.(1)[c] A mortgagee, who has taken the body of his debtor in execution for the mortgage debt,

(1) 2 Com. Dig. 622.

mortgagee from selling at law, the equity of redemption. This suggestion has been carried into effect, in New York, by statute prohibiting the sale at law of the mortgagor's equity by the mortgagee, on a judgment for a debt secured by the mortgage. 2 Rev. St. 368, sec. 31, 32. In Massachusetts, North Carolina and Kentucky, also, similar embarrassments have been felt, and the law there is, that the mortgagee cannot sell the equity of redemption, in discharge of a debt secured by the mortgage. Atkins v. Sawyer, 1 Pick. 351; Camp v. Coxe, 1 Dev. & Bat. 52; Goring v. Shreve, 7 Dana, 64. The New York Revised Statutes have, in other respects, materially changed the established practice on this subject. It is now declared, that while a bill of foreclosure is pending in Chancery, and after a decree thereon, no proceedings shall be had at law for the recovery of the debt, without the authority of the Court of Chancery; and on the other hand, if a judgment has been obtained at law, for the mortgage debt or any part of it, no proceedings are to be had in chancery, unless an execution has been returned unsatisfied, in whole or in part, and it be stated in the return, that the defendant had no property to satisfy it, except the mortgaged premises. 2 Rev. St. 191, sec. 153–156. But the commencement of an action at law, for the recovery of a debt secured by a mortgage, does not prevent the filing of a bill of foreclosure in chancery, unless a judgment has been obtained in such action. The complainant will not, however, be permit ted to proceed in an action at law commenced previous to filing his bill of foreclosure, without the special permission of this court. And, under the circumstances of the case, an order was made, authorizing the complainant to proceed in the action at law to trial and judgment, but prohibiting him from taking out execution on the judgment, without leave of this court. Suydam v. Bartle, in Chan. N. Y. Sept. 21, 1841, Barbour's Abstr. of Dec. in Ch. 71, 72.

The New York statute goes on to declare, that if the mortgaged premises should prove insufficient to satisfy the debt, the Court of Chancery has power to direct the pay. ment, by the mortgagor, of the unsatisfied balance, and to enforce it by execution, against the debtor. 2 Rev. Stat. 152; 4 Kent's Comm. 184, note. See also, Downing v. Palmateer, 1 Monroe, 66; Coote on Mortg. 517, (18 Law Library.)

[c] Where a party executes a mortgage for the security of several sums of money, to fall due at different times, upon default in the payment of the debt which first falls due, the mortgage, pro tanto, becomes forfeited, and the mortgagee may proceed for a foreclosure and sale of the mortgaged premises. Yet the mortgagor may stop proceedings, by paying or tendering what is due upon the mortgage. And where a party executes a mortgage, for the security of several sums of money, payable to the same person, and to fall due at different times, if, on default in payment of the first sum, the mortgagee files his bill to foreclose the mortgage, and, pending the suit, the other debt falls due, it is competent to take an account of all the debts intended to be secured, and to decree a sale for their payment. Singleton v. Gayle, 8 Port. 277.

Where a mortgage is given to secure the payment of four several promissory notes, and a bill of foreclosure is filed by the mortgagee, which states that the three notes last due remain unpaid, and no mention is further made of the note which arrived first at maturity, chancery will infer that it was paid, before the filing of the bill. If otherwise, and the note belongs to some other person than the complainant, at the time of filing the bill, and such a circumstance is esteemed important to the defendant, it is his duty to present the matter in his answer, such an allegation in the complainant's bill being wholly unnecessary. And where one of the notes is not due at the hearing of the cause, and the bill is taken pro confesso, chancery will order so much of the mortgaged premises to be sold, as will be sufficient to pay off the notes that are past due, together with the interest and costs; and the decree will stand as security for the payment of the amount not yet due, with leave to the mortgagee to obtain an order for the sale of the mortgaged premises, when the remaining note reaches maturity. Levart v. Redwood,

9 Port. 79.

A default in payment of a half year's interest on the appointed day, will be a sufficient breach of condition, to enable the mortgagee to foreclose. Stanhope v. Manners, 2 Eden, 197; Gladwin v. Hitchman, 2 Vern. 135; Coote on Mortg. 518, (18 Law Lib.) Where a mortgage is given to secure a sum, payable in instalments, with interest, and on default in payment of the first instalment, a bill is filed by the mortgagee, the

is, nevertheless, entitled to the benefit of his mortgage security.(1)[d]

*A second mortgagee may file a bill of foreclo- [ *531 ] sure against the mortgagor and a third mortgagee, without

(1) Davis v. Battine, 2 R. & M. 76.

defendant will not be allowed to stay proceedings, on bringing into court the principal and interest due, with the costs that had accrued, unless he also put in an answer, confessing the debt, &c., or consent to a decree of foreclosure, to remain, subject to the further order of the Court, upon a subsequent default. Lansing v. Capron, 1 Johns. Ch. Rep. 617.

Upon a mortgage to secure money by instalments, a bill to foreclose may be exhibited, for non-payment of the first instalment; and, all the instalments becoming due before the final hearing, the Court may act upon the whole contract. Adams v. Essex, 1 Bibb, 150.

Chancery may, where a bill is filed for the foreclosure of a mortgage, on which the interest is due, but the principal not yet payable, order the whole to be paid; but it is not bound to do so. Mitchell v. Tighe, 1 Hopk. 119.

Where the mortgagor has, from mere neglect, failed to perform his contract, whereby the whole debt becomes due and payable, according to the terms of the mortgage, the Court will not interfere to relieve him, without a tender or payment of the whole debt. Noyes v. Clark, 7 Paige, 179.

A court of equity will not permit the mortgagee or his assignee to take an unconscientious advantage of the mortgagor who is willing to pay at the time prescribed, but is unable to do so, in consequence of the act of the other party. Ibid.

Where a mortgage, payable by instalments, contained a power to sell the premises if any instalment of principal or interest remained unpaid for thirty days after it became due; the surplus money arising from such sale to be paid to the mortgagor, after deducting the interest and costs, and the whole debt secured by the mortgage; held, that this clause was only intended to authorize a statute foreclosure, in case of the non-payment of the instalments within the time prescribed, and with the right to retain for the whole debt, in case the instalments and costs were not paid before the sale; but that it did not make the whole debt due and payable, by a mere neglect to pay the instalment within the time prescribed. Holden v. Gilbert, 7 Paige, 208.

Where a bond and mortgage for the payment of the principal in five years, with annual interest, contained a condition, that if default should be made in the payment of interest or any part thereof, at the time it became due, the whole principal and interest should become due, by reason of such default; and shortly before the interest became due, the mortgagee, who had assigned the bond and mortgage and guaranteed its payment, informed the mortgagor he had so assigned it, but gave no information of the residence of the assignee; and the mortgagor, being unable to find the supposed assignee, tendered the interest to the mortgagee, on the day it became due, who refused to receive it, and shortly afterwards the assignee filed a bill to foreclose the mortgage; held, that the tender of the interest to the mortgagee, was sufficient to save the forfeiture, or at least sufficient to authorize the Court to stay the proceedings, upon the payment of the interest then due, until further default in payment of the principal or interest. Noyes v. Clark, 7 Paige, 179.

A tender of the money due on a mortgage, after the condition of the mortgage has been broken, does not turn, what was before an equity of redemption, into an absolute estate, discharged of the lien of the mortgage money, which remains unpaid; but a tender of the money, on the day it becomes due, is a compliance with the condition, and, by the terms of the mortgage, divests the whole interest or estate of the mortgagee in the premises. Merritt v. Lambert, 7 Paige, 344.

When a mortgage is payable by instalments, the mortgagee has a right to sell the premises, discharged of the lien of the future instalments, and to retain the whole amount of his mortgage and costs out of the proceeds of the sale. Cox v. Wheeler, 7 Paige, 248.

[d] See ante, 428, note.

Eng, Chan. Reps. vi. 404.

making the first mortgagee a party.(1)[a] A mortgagor is a necessary party to a bill by a second mortgagee, to redeem the first mortgagee, and foreclose the equity of redemption.(2)[6] And if the mortgagor is dead, his heir must be before the Court, and if the heir is abroad, the Court cannot proceed.(3) An insolvent mortgagor, even where his assignees disclaim all interest in the equity of redemption, is not to be made a party to a suit for foreclosing the mortgage.(4) If the mortgagee has no notice of other incumbrancers, the bill is only filed against the mortgagor, and unless such mortgagor refers the suit under the statute, it is proceeded with, to a decree, in the ordinary way.

In a bill of foreclosure it is sometimes necessary to pray for the appointment of a receiver, and also for an injunction. A mortgagee who has the legal estate cannot have a receiver, he has nothing to do but to take posses

(1) Rose v. Page, 2 Sim. 471.

(2) Farmer v. Curtis, 2 Sim. 466.

(3) Scott v. Nicholl, 3 Russ. 476. Fell v. Brown, 2 Bro. C. C. 276. (4) Collins v. Shirley, 1 R. & M. 638.

[a] The general rule, however, seems to be, that all incumbrancers, (as well as the mortgagor,) should be made parties, if not as indispensable, at least, as proper parties to a bill of foreclosure, whether they are prior or subsequent incumbrancers. Finley v. The Bank of the United States, 11 Wheat. 304; Haines v. Beach, 3 Johns. Ch. Rep. 459; Ensworth v. Lambert, 4 Johns. Ch. Rep. 604; M'Gown v. Yorks, 6 Johns. Ch. Rep. 450; Lyon v. Sandford, 5 Conn. 544; Renwick v. Macomb, 1 Hopk. 277; Story's Eq. Pl. 176, 177. The reason of the rule requiring all incumbrancers, subsequent as well as prior to the plaintiff, to be made parties, is to give security and stability to the purchaser's title; for he takes a title only as against the parties to the suit; and it cannot, and ought not to be, set up against the subsisting equity of those incumbrancers who are not parties. 4 Kent's Comm. 185.

On a bill of foreclosure by a subsequent mortgagee, he will be entitled to redeem the prior mortgage, and then to sell the whole estate for the money due on both mortgages. The Western Ins. Co. of the Village of Buffalo v. The Eagle Fire Ins. Co., 1 Paige, 284. If the prior mortgage should not be due, the junior mortgagee will be entitled to a decree for a sale of the mortgaged premises, subject to such prior mortgage. Ibid. The mortgagor has a right to stay proceedings, upon payment of the mortgage money, interest and costs as against the last mortgagee, though prior incumbrancers are made defendants. Laskett v. Cliffe, 4 Lond. Jurist, 715.

[b] Story's Eq. Pl. 180. A mortgagor, who is personally liable to the mortgagee, for the payment of the debt secured by the mortgage, but who has parted with all his right and interest in the mortgaged premises, is a proper party, but not a necessary party, to a bill to foreclose the mortgage. Where the mortgagor has conveyed the equity of redemption, absolutely and without warranty, the mortgaged premises are the primary fund for the payment of the mortgage debt; and the grantee has no right to object that the mortgagor is not made a party to the bill of foreclosure. But where the complainant makes a mere surety of the mortgagor, for the payment of the debt, a party to the bill of foreclosure, for the purpose of obtaining a decree against such surety, or his property, if the proceeds of the mortgaged premises are found to be insufficient, to satisfy the debt and costs, such surety has a right to insist, that the principal debtor shall be made a party to the suit, if he is within the jurisdiction of the Court. Bigelow v. Bush, 6 Paige, 346.

Eng. Chan. Reps. ii. 501.

Ib. iii. 490. Ib. v. 592.