inal bill, where they are necessary to complete relief. Brandon Manuf'g Co. v. Briner, 14 Blatchf. 371. And the practice is established of joining, for purposes of discovery, an officer of a defendant corporation, where plaintiff is entitled to discovery in a suit against a corporation. The reason of the rule, as stated by Lord Chancellor Talbot in the leading case of Wyck v. Mead, 3 P. W. 310, which seems to have finally established the practice, is that as "the plaintiff ought to have discovery," and as "the defendants can answer no otherwise than under their common seal, and though they answer never so falsely, still there is no remedy against them for perjury;" therefore, “it has been a usual thing to make the secretary, book-keeper, or any other officers of a company defendants." As observed in that case, although the answer of the defendant could not be read against the company, "yet it may be of use to direct the plaintiff how to draw and pen his interrogatories towards obtaining a better discovery," and “it may be very mischievous and injurious to the subject to deprive them of that discovery to which, in common justice, they are entitled;" and, on the other hand, "no manner of inconvenience can ensue from obliging such officers of a company to answer." Later cases have added but little either to the extent of the rule or the exposition of the reason upon which it is based. It is conceded to be an exception to the general rule that a mere witness cannot be joined for purposes of discovery. And the rule has been extended to members of a corporation who are not officers. Fenlon v. Hughes, 7 Ves. 289; Moodalay v. Morton, 1 Bro. Ch. 469; Dummer v. Chippenham, 14 Ves. 245; Many v. Beckman Iron Co. 9 Paige, 188; U. S. v. Wagner, L. R. 2 Ch. 582; Glasscott v. Iron Co. 11 Sim. 305.

No case has gone so far as to join an officer of a corporation for the purpose of a discovery of matters which were not within his knowledge as such officer, or learned by him while in the service, or as a member of the corporation, nor, as in this case, matters which took place before the corporation was formed, or in which it had no part, though it appears that by and through other sources of information the

officer happens to have obtained such knowledge. Assuming. that the matters inquired of are, as stated by plaintiff's counsel, dealings in which he was agent for those who are now stockholders or beneficiaries of the company, and which dealings were part of the process of bringing that company into. life, yet there is no precedent for this bill, as a bill of discovery, against the defendant Osborn, and to sustain it would, I think, be going beyond the recognized limits of this exceptional rule, and beyond the reasons on which the rule is founded. See Story Eq. Pleadings, (9th Ed.) § 235, notes, and cases cited.

Demurrer sustained.

TOMMEY and others v. SPARTANBURG & ASHEVILLE R. Co. and others.

(Circuit Court, W. D. North Carolina.

1. FORECLOSURE OF MORTGAGE-PRIORITY OF LIEN.

1881.)

Claims of contractors and laborers for labor performed in the construction of a railroad subsequent to the execution of a mortgage on the road will not be allowed, except as postponed to the mortgage debt, and this, whether or not mechanics' or laborers' liens have been filed in the proper court.

Contracts made prior to the execution of the mortgage, and work done thereunder, create no lien superior to that of the mortgage.

Claims of contractors and laborers for labor performed in the construction of a railroad subsequent to the execution of a mortgage on the road, to secure its bonds, will not be allowed, except as postponed to the bondholders, notwithstanding the work was performed and a mechanics' or laborers' lien filed in the proper court before the registration of the mortgage in the state where the labor is performed and the lien filed.

In Equity.

This was a bill filed by complainants for themselves, and in behalf of all other holders of the "first mortgage 7 per cent. gold bonds" of the Spartanburg & Asheville Railroad,

*Reported by Thomas M. Pittman, Esq., of the Charlotte, N. C., bar.

against the Spartanburg & Asheville Railroad Company, J. B. Cleveland, and W. H. Inman, trustees named in the mortgage, and Rice & Coleman, Fry & Deal, E. Clayton, and John Garrison, creditors of the Spartanburg & Asheville Railroad, as contractors, laborers, and material men, for the foreclosure of the mortgage to secure said bonds. The defendant corporation was formed by the consolidation of the Spartanburg & Asheville Railroad Company, of South Carolina, and the Greenville & French Broad Railroad Company, of North Carolina, July 31, 1874. The stockholders of the Spartanburg & Asheville Railroad Company, August 9, 1876, adopted a resolution in regard to placing a mortgage on the road, which was followed on the same day by the adoption of a similar resolution by the board of directors. The mortgage, securing bonds to the amount of $670,000, was executed October 1, 1876, by the president affixing the seal of the company, and signing, "The Spartanburg & Asheville Railroad Company, by D. R. Duncan, President." W. K. Blake signed it as secretary and treasurer of the company, and W. H. Inman and John B. Cleveland, the trustees, also signed it and affixed their seals. Afterwards, but prior to September 28, 1878, two of the directors affixed their hands and seals. This mortgage was duly registered in Spartanburg county, South Carolina, June 20, 1877. The master finds that the mortgage was duly registered in Buncombe county, North Carolina, November 25, 1878; in Henderson county, North Carolina, November 23, 1878; in Polk county, North Carolina, November 22, 1878. Six hundred and forty-two thousand dollars of the bonds passed out of the hands of the company; $4,500 becoming the property of plaintiff V. R. Tommey. Six hundred and fifteen thousand dollars were held as collateral. The mortgage provided that the whole amount of the bonds should fall due upon default in the payment of interest for six months. De-. fault was made, upon which this suit was brought. Fry & Deal entered into a contract with the Spartanburg & Asheville Railroad Company, June 2, 1877, to build four trestles on the line of the road in Polk county, North Carolina, and the work

was completed June 17, 1878. Fry was a mechanic, and worked himself on the trestles, and superintended the labor. The firm furnished the materials. They knew at the time the work was done of the existence of the mortgage. They filed their lien in Polk county, North Carolina, August 3, 1878, for $6,335.16, and on October 16, 1878, instituted proceedings in the superior court of that county to enforce their lien. John Garrison contracted, June 2, 1877, to build "Mill Creek Trestle," which he completed about the seventeenth of February, 1878. He filed a lien in Polk county, April 2, 1878, and began an action to enforce it, August 10, 1878. Garrison was a mechanic, and did some of the work, but his principal labor was as a contractor, to superintend the mechanics and laborers employed under him. T. G. Williamson was one of the engineer corps of the company, and was due $911.40 from March, 1878. He filed his lien in Polk county, June 4, 1878. There is a balance due Rice & Coleman for work done since October 1, 1876, of $22,935.23, from May 1, 1878. Coleman was a stockholder in the company, but was not present at the meeting which authorized the mortgage. They knew of the making of the mortgage, and received, after October 1, 1876, about $62,000, in county bonds and cash, from

the company, on this contract. While engaged in grading

the road they bought the land over which about two miles of their contract extended, and the company having neglected to have the right of way through the land condemned according to law, they assert titles to the road-bed and superstructure on their land. E. Clayton was a stockholder of the company. There is due him the sum of $3,316.87, for work done on the South Carolina division of the road before August, 1876. Another contract was made with him prior to October 1, 1876, on which there is a balance due of $23,661.25 from November 1, 1877. He was present at the meeting which authorized the mortgage, and did not vote against it. He claims title to a portion of the road-bed and superstructure, similar to that of Rice & Coleman. The two last-named parties claim statutory liens. The commissioners of Buncombe county were stockholders, and became parties defendant.

Chandler & Thompson, Bynum & Grier, J. H. Rion, and Mr. Brown, for complainants and trustees.

Evans, Bobo & Carlisle, Shipp & Bailey, J. H. Merriman, T. Coleman, W. J. Montgomery, and M. E. Carter, for defendants.

BOND, C. J. This is a bill filed by the mortgage trustees and the bondholders, secured by the mortgage against the defendant corporation and others, to-wit, creditors of the defendant corporation claiming mechanics' liens and statutory liens for labor done on the Spartanburg & Asheville Railroad, to foreclose the mortgage and sell the road pursuant to the terms of the mortgage. The case is for final hearing upon the pleadings, evidence, report of the special master, and exceptions to his report. The material facts reported by the master are not controverted, and are these:

The Greenville & French Broad Railroad Company was incorporated by the legislature of North Carolina, February 13, 1855, and the Spartanburg & Asheville Railroad Company was incorporated by the legislature of South Carolina, February 20, 1873, and the two companies were consolidated under the name of the Spartanburg & Asheville Railroad Company, July 31, 1874, under the general laws of the two states, and the new company thus formed is clothed with all the rights which were originally conferred upon the separate companies. The defendant company thus organized commenced to build its road from Spartanburg, in South Carolina, to Asheville, in North Carolina, and, having expended its assets, the stockholders resolved, on the ninth day of August, 1876, to issue and sell bonds to the amount of $670,000, and to secure their payment and interest on them by a mortgage upon the consolidated road. The mortgage was duly executed by the company on the first day of October, 1876, and the bonds to the amount of $642,000 were sold or hypothecated, and came into the hands of the plaintiff holders and others for value bona fide. The third section of the mortgage, which is filed as an exhibit, contains the conditions of it and the powers granted to the trustees, mortgagees thereunder. It was not seriously contended in the argument that the defendant company had not power to make the mortgage, or that the conditions had not been broken at the commencement of this action.

The master so finds, and his report is hereby confirmed. The defendant creditors claim that they, as contractors and laborers, have a lien upon the road prior and superior to the bondholders, and are first entitled to the proceeds of the sale of the road, if the court should decree a sale. This is the principle question in the case. These claimants are of two