The principles upon which Sir T. Plumer proceeded were these. That "although the cestui que trust could not transfer the legal interest, which must remain with the executors, yet, wherever it was intended to complete the transfer of a chose en action, there was a mode of dealing which a Court of Equity considered tantamount to possession, viz., notice given to the legal depository of the fund. By such notice the legal holder was converted into a trustee for the new purchaser, and the cestui que trust was deprived of the power of carrying the same security repeatedly into the market. This precaution was always taken by diligent incumbrancers, and if it was not taken, there was neglect, and the solicitor who conducted the business was responsible for that neglect. To give notice was a matter of no difficulty, and wherever persons treating for a chose en action did not give notice to the trustee or executor, they did not perfect their title, they did not do all that was necessary to make the thing belong to them in preference to all other persons, and they became responsible in some respects for the easily foreseen consequences of their negligence (k). It was objected qui prior est tempore potior est jure; but it could not be contended that priority in time must decide where the legal estate was outstanding, for the maxim as an equitable rule admitted of exceptions, and gave way when the question did not lie between bare and equal equities. If there appeared to be, in respect of any circumstance independent of priority of time, a better title in the puisne purchaser to call for the legal estate than in the purchaser who preceded him in date, the case ceased to be a balance of equities, and the prefer

(k) 3 Russ. 12-14.

ence, which priority of time might otherwise have given, was done away with and counteracted. What title had the prior incumbrancer to call on a Court of justice to interpose in his behalf, in order to obviate the consequences of his own misconduct? He had omitted to perfect his security: a third party had innocently advanced his money, and had perfected his security as far as the nature of the subject permitted, and was that Court to interfere to postpone him to the other? It was said notice did not form part of the necessary conveyance of an equitable interest. If a person meant to rely on the contract of the individual, there was certainly no need of notice, for from the moment of the contract he with whom the party was dealing was personally bound; but if it was meant to go farther, and attach a right upon the thing itself which was the subject of the contract, it was necessary to give notice, and if an individual who contracted with another did not by giving notice to the trustee divest the vendor or mortgagor of the possession, but permitted him to remain the ostensible owner as before, he must take the consequences which might ensue from such a mode of dealing (1)."

In Smith v. Smith (m) the notice by the first incumbrancer was given to one only of three trustees, and it was held he did not lose his priority. Maberley, being indebted to Smith, assigned to him by way of security his life-interest in certain funds under his marriage settlement, and afterwards became bankrupt. The assignee having mentioned his security to one of the trustees before the bankruptcy occurred, the question was, whether after such notice the fund was at the time of the bank

(1) 3 Russ. 20-22.

(m) 2 Cr. & Mees. 231.

ruptcy in the power and disposition of the bankrupt, and it was determined in the negative. Lord Lyndhurst, in delivering the judgment of the Court, observed, "It was argued that notice to one only of three trustees is insufficient that it should have been given to each of them, and that, this not having been done, the property remained in the order and disposition of the bankrupt up to the time of his bankruptcy; but we are of opinion that notice to one of the three trustees was sufficient : no valid assignment could have been made by the bankrupt after the notice to the trustee : a second assignee, in order to have obtained a priority over the first, must have shewn that he had exercised proper precaution in taking the assignment, that he had applied to the trustees to know if any previous assignment had been made, and unless he applied for this purpose to each of the trustees, he would not have exercised due caution, or done all that he ought to have done. But if he applied to each of the trustees, he would have been informed by one of them of the previous assignment to Smith, and he must then have taken the property, if at all, subject to the claim of Smith."

The only point positively determined in this case was, that if notice be given to one of three trustees, no second incumbrancer can gain a priority during the lifetime of that trustee supposing it was the duty of the first incumbrancer to have given notice to each of the trustees, it was equally the duty of the second incumbrancer to have made inquiries of each of the trustees; and as both incumbrancers were guilty of negligence, or at least did not exert their utmost diligence, there was nothing to disturb the natural priority. But had the first incumbrancer contented himself with giving notice to one of

the trustees, and that trustee had died, and a second incumbrancer had made inquiries of the surviving trustees, and given them notice of his own assignment, then, it may be said, as the first incumbrancer did not do his utmost to guard against the fraud, and the second incumbrancer employed all the means in his power of detecting the fraud, the loss ought to fall on the person who had so far occasioned that he might have prevented it.

From the observation of Lord Lyndhurst, that "a second assignee, in order to obtain priority over the first, must shew that he has exercised proper precaution in taking the assignment,—that he has applied to the trustees to know if any previous assignment has been made," it seems to have been his Lordship's opinion, that if a prior incumbrancer neglected to give notice, but the second incumbrancer did not inquire, and therefore was not deceived, the maxim qui prior est tempore potior est jure ought to prevail; and this appears certainly the doctrine most consistent with principle. But in Foster v. Blackstone (n), before Sir J. Leach, and affirmed in the House of Lords, it was decided a second incumbrancer gains priority by the mere act of giving notice, whether he inquire or not. "A better equity," it was remarked, "is, where a second incumbrancer without notice takes a precaution against a subsequent incumbrancer, which the prior incumbrancer has neglected to take." Supposing this to be law, if a prior incumbrancer give notice to one only of three trustees, as in Smith v. Smith, and that trustee dies, and a second incumbrancer after the death of the trustee gives notice to the surviving trustees, but makes no inquiries at the time of the assignment, it may

(n) 1 M. & K. 297; and see Timson v. Ramsbottom, Append. No. 4.

still be questioned whether he does not gain the priority. The recent case of Timson v. Ramsbottom (o) seems actually to have decided in favour of the second incumbrancer. A testator appointed Bacon the elder, Timson, Ramsbottom the elder, and Ramsbottom the younger, his executors. In 1816 Ramsbottom the elder died. By indenture dated in 1819, and made between Bacon the younger of the one part, and Thomas Bacon (not the executor), Langford, and Walford of the other part, Bacon the younger, who took an interest under the will, assigned it to trustees upon trust for securing the repayment to Bacon the elder of 5000l. and interest. In 1827 Bacon the elder died, without having communicated the charge to his co-executors. In 1828 a bill was filed, and the testator's estate was brought into Court. By indenture, dated in 1832, Bacon the younger assigned the same interest to Corfield, who had no notice of the prior incumbrance and made no inquiries, for securing to Corfield the sum of 1000l. and interest. In 1833 a regular notice of the assignment was sent by Corfield to the surviving executors (p). Lord Langdale, in decreeing the priority of the second incumbrancer, observed, "None of the cases cited at the bar appear to me to be like the present-of a father and son having a transaction of this sort between themselves, the father being one of several executors-no allegation even that the other executors were informed before the notice was received from Corfield-no ground to presume that the transaction was communicated

(0) See Append. No. 4.

(p) The Master of the Rolls in his judgment states that notice was given to Timson, but his reason

ing assumes, and the fact was, that notice was also given to Ramsbottom.