separate parcels of the mortgaged premises by warranty deeds to successive grantees, and there are no special provisions in any of their deeds, and no other dealings between themselves or with the mortgagor which disturb the equities otherwise existing, a priority results, depending upon the order of conveyance. As between the mortgagor and all the grantees, the parcel in his hands, if any, is primarily liable for the whole mortgage-debt, and should be exhausted before having recourse to any of theirs; as between the grantees, their parcels are liable in the inverse order of their alienation" (that is, that last conveyed is first liable), "and any parcel chargeable first in order must be exhausted before recourse is had to the second:" sec. 1224. This, I think, is a correct statement of principles applicable in this jurisdiction, with this limitation, that the Court will only under special circumstances interfere with the right of the mortgagee to proceed against such of the property as he sees fit, but will usually leave the rights of the several purchasers as between themselves unaffected and to be adjusted by the application of the doctrines of marshalling and subrogation. See 1 W. & T. L. C. in Eq., 8th ed., p. 61, notes to Aldrich v. Cooper. Subsequently (sec. 1226), the author discusses the position created by the mortgagee releasing one or more parcels: "Although the equities between the subsequent owners of various parcels of the mortgaged premises, whether equal or unequal, do not prevent the mortgagee from enforcing the mortgage security, if necessary, against all these parcels, yet, after the mortgagee has received notice of the subsequent conveyances, the equities affect him to such an extent that he cannot deal with the whole premises or with any parcel thereof, or with the owner of any parcel, by release or agreement, so as to disturb the equity subsisting among the various owners, or to destroy their right of ratable contribution or of complete or partial exoneration. No such obligation, however, rests upon the mortgagee, nor is he prevented from dealing with the mortgaged premises in any manner consistent with his general rights as mortgagee, unless he has received notice of the conveyances to the subsequent owners whose interests could be affected by his dealings; notice of their conveyance would be notice of all the equities which arise therefrom. . The effect of a partial release by the mortgagee who is charged with notice differs in the two cases, where the equities of the various owners are equal and where they are unequal. In the first case, where the mortgaged premises have been conveyed to or are held by various owners, in such manner that their equities are equal and all their parcels of shares are liable to a ratable contribution, if the mortgagee, having notice of such condition, releases one of the parcels or shares, he thereby discharges a part of the mortgage-debt equal to the ratable portion thereof chargeable upon the lot released, while the balance of the debt alone remains a burden upon the other parcels or shares of the premises. . . When the equities of the various owners are unequal, so that their respective parcels are liable in the inverse order of alienation, if the mortgagee, having notice of their situation, release a parcel which is primarily liable, he thereby discharges or leases all those parcels which are subsequently liable in the order of their several liabilities, from an amount of the mortgage debt equal to the value of the parcel released." The question is discussed in works on Equity under the title "Marshalling of Assets" or "Subrogation." Vide, e.g., Story's Eq. Jur., 2nd Eng. ed., sec. 633; 1 W. & T. L. C. in Eq., 8th ed., p. 35, Notes to Aldrich v. Cooper. The English and Ontario cases are reviewed in Pierce v. Canavan, 28 Gr. 356, 7 A. R. 187. Sheldon in his Law of Subrogation, 2nd ed., sees. 74, 75, puts the law in the same way as Pomeroy. In sec. 77 he says: "A distinction has sometimes been made between the lien of a judgment or attachment and that of a mortgage. But the great mass of cases put the incumbrance of a judgment upon exactly the same ground as any other incumbrance, as to its effects upon the rights of subsequent purchasers of parts of the incumbered premises." I think, also, that this paragraph expresses the law applicable in this jurisdiction. See 1 W. & T. L. C. in Eq., vol. 1, 8th ed., p. 62. As I have already indicated, it must be taken that neither Zilinski nor Sandford knew of any prior charge against the lands; that Bromley did not know of the sales to Zilinski or Sandford; that he knew of the agreement with Lang, and paid to Kesner and Moore $575 and interest, being one-half of the amount owing by Lang; Zilinski's purchase-money was $474, and the date of his agreement 10th April, 1907; Sandford's purchase-money was $600, and the date of his agreement 4th June, 1907; Bromley's purchasemoney payable to Lang was $525, and the date of his agree ment 23rd September, 1907. The re-pective values of these parcels-Bromley's being an "equity "-may be taken to be the purchase-price in each instance; these values can be brought to the same date by charging Zilinski and Sandford interest at 8 per cent., the rate mentioned in the agreements, from the dates of their purchases to the date of Bromley's purchase. The interest in Zilinski's case is $17.70, making with his purchase-price $492.70. The interest in Sandford's case is $14.50, making with his purchase-price $614.50. If, when these 3 persons purchased, the whole land had been subject to an execution, of which they had no knowledge, I think that they would properly be held liable to contribute to the payment of the execution debt in the proportions represented by the values of the portions purchased by each respectively, ascertained as above; that is, Zilinski's half lot being taken as worth $192.70, Sandford's half lot as $614 50, Bromley's "equity" in one lot as $525; and that Kesner and Moore have, by their dealings with Bromley, released Zilinski and Sandford to the extent that Bromley would have been bound to contribute. I think the rule of charging the properties in the inverse order of their alienation does not apply, because of the want of knowledge by Bromley of the previous sales. Land Security Co. v. Wilson, 22 A. R. 151, affirmed in Wilson v. Land Security Co., 26 S. C. R. 149, cited by Mr. Landry, I think, does not apply, in consequence of the special provision of the agreement in that case. The question of costs may be spoken to; and, if the parties cannot agree upon the result of the principle of calculation I have laid down, I will fix the amount. WESTERN LAW REPORTER CANADA INDEX-DIGEST TO VOLUME XVII. See Contract, 1-Costs, 4, 5-Criminal APPROPRIATION OF PAYMENTS. ARBITRATION AND AWARD. See Municipal Corporations, 4. ASSAULT. Civil Action for-Intention-Removal of See Criminal Law, 2, 3. ASSESSMENT AND TAXES. 1. Corporations Taxation Act, secs. 3 |