serve. Nor could the assignees divest themselves of the trust by assigning the bond and mortgage in the manner stated in the bill. When Dickey purchased of Sandford, the mortgage which the latter had given, instead of being in the hands of the assignees and subject to the trust upon which it had been given, was found to have been assigned contrary thereto. He was also required to pay it off; and it was satisfied out of the money which Mr. Dickey was to give for the property. Upon the assignment of the mortgage, the trust which originally attached to it must be considered as attaching to the money in the hands of the mortgagees and they may be regarded in equity as trustees of it by substi tution. If then there be a trust fund and trustees of it: for whose benefit does it enure? It must be remembered that the mortgage was to be held until the title should be made perfectly satisfactory to Mr. Sandford and his assigns. The nature and object of this arrangement appears to embrace all who might become purchasers under him, through the title which the assignees of the bankrupt's estate undertook to confer. The title failed. A loss resulted; and this has been borne by one who purchased from Sandford upon the faith of the title derived from the assignees, and which the trust was intended to secure. He or those standing in his place and taking his rights, are the persons entitled to the benefit of it. When we take the allegations in the bill to be true, the present appears to be a case which entitles the complainants to the relief which is sought. Instances will be found, observes an able writer on equity jurisdiction, to spring from some circumstances attending transactions, as of accident, mistake or fraud, which, in themselves, form grounds of this court's interference, inducing it to imply a trust upon what it ascertains to be the conscientious duty of a party; and, in accordance with its general principles, to compel him to the performance of that which natural justice demands: Jeremy's Eq. Jur. 94. There is some reason, at least, for supposing the present to be one of the cases falling within this salutary principle. And as I cannot do more, so I think I cannot do less than overrule the demurrers. 1833. DENSTON V. MORRIS. 1833. DENSTON V. MORRIS. A distinction has been attempted to be made, upon the argument, between the original surviving assignee and the two assignees since then associated with him. It is said, that if the bill is properly filed against the former on the ground of fraud, yet it is not so as respects the latter, and their demurrer should be allowed. But, if I am correct in supposing the bill may be sustained upon the ground of a trust, then the circumstance of all the assignees being considered trustees of the fund sought to be reached, rendered them all proper parties to the suit. Another point was raised upon the argument: that if there ever were a cause of action, it was barred by lapse of time. I cannot listen to this objection upon a demurrer: especially as the bill shows that the commissioners in bankruptcy have directed the assignees to retain a sum of money, in order to satisfy this claim, should it be supported in a court of equity. Besides, if the statute of limitations or the staleness of the demand affords any ground of a defence in a case like the present, I think it should be put forward by a plea or be set up in an answer: and not through a demurrer. The last objection which I have to examine is this: that it belongs to the commissioners and the district court of the United States, under the authority of the bankrupt law itself, to decide upon this claim; and that the court of Chancery has not jurisdiction. I think it is a sufficient answer to say, it is not a debt claimed to be due or owing from the bankrupt or to be paid out of his estate pro rata with the creditors, but a remedy sought against the assignees in relation to a sum of money which has found its way into their hands, and not belonging to the bankrupt—that it is a trustfund to which the complainants are equitably entitled, and over which (as well as over those assignees as being trustees) this court has a concurrent, if not an exclusive jurisdiction. Indeed, the bill states that the commissioners entertained doubts of their powers; and referred the parties to a court of equity or other competent tribunal; and I must presume this was done on account of the claims partaking of the nature of a trust and was not a debt or demand against the bankrupt. I must overrule the demurrers, with costs. Where circumstances denote fraud in omitting to reduce a part of an agreement into writing, the whole of it is open to parol proof. The Court disregards the writing and treats the whole transaction as a verbal contract. Bill filed by the lessee of premises, which he held under a church lease, against persons who had agreed in writing to purchase his lease. Complainant alleged that an implied right of renewal entered into the purchase, and that defendants were to take, subject to a burthen upon a part of the premises of a lease for a year which had been granted by the complainant. The buyers omitted to insert these things in the written agreement, but verbally recognized them; and they managed to get a renewal in their own names, through the recommendation of the complainant; but declined, inasmuch as the old term had in the mean time expired, to make good their agreement with the latter, and proceeded to eject the tenant who was to have held possession of a part for a year. Complainant prayed that the parties might pay their purchase money and perform their contract with him. A general demurrer was interposed: but overruled. Specific per contract. Bill by Duncan Phyfe, the lessor of certain real estate, April 11th. against Charles Wardell and Britain L. Woolley, as purchas- 1833. ers, in order to compel payment of purchase money and obtain specific performance of a contract. It stated, that the formance. complainant was possessed of a leasehold interest in a lot of Fraud in ground in Vesey street, city of New York, under lease from omitting part the officers of St. Michael's church for a term of years, and of written which would expire on the twenty-fifth day of March, one Demurrer. thousand eight hundred and thirty-two; and became vested in the complainant through diverse mesne assignments. That on the first day of February, one thousand eight hundred and thirty-two, he entered into an agreement with one Decker, to underlet to him part of the premises for a year, from the first day of May following; but was ignorant at the time that the original lease would expire on the said twenty-fifth day of March. The bill also set forth, that about the fif teenth day of February, one thousand eight hundred and thirty-two, the defendants applied to the complainant to purchase the unexpired term, with the right and privilege which 1833. PHYFE v he, as the holder of the lease, had to a renewal of it; and they represented their having bought leases, covering adjoining lots, and their desire of improving the whole of the property. WARDELL. He, at first, declined negociating with them; but they subsequently made repeated applications and offered to purchase the remainder of the term, subject to Decker's lease for a year, and assume the complainant's responsibility to him-stating their object to be, to get possession of the lot for purposes of improvement and because they could then put up buildings, which they wished to erect upon the premises and on adjoining lots, at one and the same time. The bill charged it to have always been a custom for St. Michael's Church to grant renewals of leases to persons possessed of leases which were about to expire, in preference to giving them to strangers: and that such privilege of renewal formed a valuable part of the leases and always entered into the consideration of sale and transfer, and to obtain the privilege of renewal was the primary object which the defendants had in view in proposing to purchase the unexpired term, and it was their intention immediately to procure a new lease of the lot, remove the old buildings and make new and expensive improvements-the latter of which, indeed, they were doing. That after much solicitation and on the ninth day of March, one thousand eight hundred and thirtytwo, the complainant consented and agreed to sell and assign his unexpired term and right of renewal in the premises to the defendants, for the price of two thousand six hundred and fifty dollars subject however to the lease for a year granted to Decker. A memorandum in writing was then signed and exchanged between the parties. The one signed by the defendants was in these words; "We agree to purchase of D. "Phyfe, for the consideration of two thousand six hundred "and fifty dollars, the lease of the lot No. 38 Vesey street, "with the buildings thereon, to be paid for in the first week "in May next, when possession and a title is to be given for "the same. March 9, 1832." The bill then alleged, that, upon receiving this writing the complainant objected to it: because his right to renewal and the defendants' engagement to assume the responsibility to Decker were not mentioned. Also, that they thereupon replied, those points were 1833. PHYFE v. admitted and well understood and no advantage would be taken by them of the omission; and the complainant thereupon rested satisfied. It further alleged, that neither party had then examined the lease or knew the period of its expiration, WARDELL. nor was it considered material, as the defendants had previously determined, in case they purchased, to procure a renewal immediately: but the agreement was made upon the express understanding that the unexpired term was sold and purchased, whatever it might, upon examination, prove to be. That shortly afterwards, the complainant was informed by the agent of the Church, of the lease having expired; and an offer of renewal was made to him; and he then informed the agent of his having sold to the defendants and that the Church might agree with and make the new lease directly to them-and to all of which they assented and the defendants well knew he gave those directions in the full confidence of their performing their part of the contract of purchase. And that, in pursuance of such directions, a new lease was made to them by the Church on the first day of May, one thousand eight hundred and thirty-two, for the term of twenty-one years. The bill charged, that if such directions had not been given, a new lease would have been granted to the complainant in his own name. That, after the directions were given to make out the lease in the names of the defendants, but before it was delivered, the complainant discovered, upon conversing with the defendants, that they did not intend to observe the agreement made with them. He, thereupon, notified the agent of the church not to deliver the lease until the defendants should have paid the purchase money and fulfilled their agreement with him; and yet the lease was delivered to them. That the complainant had since requested payment of the two thousand six hundred and fifty dollars, which they had refused; and they had caused Decker, the tenant under the complainant, to be ejected, and had demolished the old buildings and had commenced the erection of new ones upon the lot, and, in consequence of being evicted, Decker claimed damages from the complainant and threatened him with an action at law. The bill prayed a specific performance of the agreement, by the defendants paying to the complainant the sum of two thousand six |