Opinion of the Court.

The case was heard in the Circuit Court upon the pleadings and proofs disclosing the state of facts already recited, when a decree was rendered dismissing the bill for want of equity. From this decree the present appeal has been taken.

Mr. Charles P. Crosby and Mr. Charles L. Easton, in person, for appellant.

Mr. Edward Salomon for appellee.

MR. JUSTICE MATTHEWS, after stating the case as above reported, delivered the opinion of the court.

The right of the complainant to the relief prayed for is based upon the contention that the German-American Bank originally held the bonds secured by the deed of trust as a pledge given by way of security for the repayment of the lo to Bowen Brothers; that it has never sold that pledge, in pursuance of the terms of the agreement between the parties, and as required by law; that the land itself, the title to which was conveyed by Bowen Brothers to Smith in trust, was a mere incident to the pledge and a part of it; that notwithstanding the form of a sale under the trust deed by the trustee to Dexter, there was no sale in fact, and in law the conveyance by Dexter to the bank operated only to convey the title to the bank in the same capacity in which it held the bonds as collateral, that is, as trustee for the debtors; that the subsequent sale by the bank to Dore was the first effective conveyance of an absolute title, but was made by the bank in its capacity as trustee for the Bowens; and that as such the complainant, having succeeded to the Bowens' rights, is enti tled to require the bank to account for its proceeds.

Where personal property is pledged, the pledgee acquires the legal title and the possession. In some cases, it is true, it may remain in the apparent possession of the pledgor, but, if so, it can be only where the pledgor holds as agent of the pledgee. By virtue of the pledge, the pledgee has the right by law, on the default of the pledgor, to sell the property pledged in satisfaction of the pledgor's obligation. As in that

Opinion of the Court.

transaction the pledgee is the vendor, he cannot also be the vendee. In reference to the pledge and to the pledgor, he occupies a fiduciary relation, by virtue of which it becomes his duty to exercise his right of sale for the benefit of the pledgor. He is in the position of a trustee to sell, and is by a familiar maxim of equity forbidden to purchase for his own use at his own sale.

The same principle applies with a like result where real estate is conveyed by a debtor directly to a creditor as security for the payment of an obligation, with a power to sell in case of default. There the creditor is also a trustee to sell, and cannot purchase the property at his own sale for his

own use.

In the present case, the bonds of the Bowen Brothers, secured by the deed of trust, were pledged to the GermanAmerican Bank as security for the repayment of the loan made to the Bowen Brothers, but those bonds have not in fact been sold, unless the transfer of them by the bank to Dore be considered a sale. It was not such, however, in point of fact or of law; nothing was paid for them, and they were delivered to Dore merely as muniments of title in connection with his purchase of the real estate. At that time they were of no value, for they were merely the personal obligations of the Bowen Brothers, from which they had been released by the discharge in bankruptcy. No suit could have been maintained upon them as against the only obligors by whose discharge in bankruptcy they had lost their character as well as their value as property.

The equity of the complainant, therefore, if he have any, must be considered as transferred from the bonds themselves, viewed as instruments and obligations, to the money which had been received on account of them by virtue of the sale of the real estate by the bank to Dore. Whether the complainant can now assert any equitable interest in that money depends in the first place on the nature of the title which the bank acquired by the conveyance to it from Dexter; and whether the principles of a pledge, and of a trust arising thereon, apply to the real estate conveyed by the Bowens to Smith as a trustee to secure the payment of the bonds.

Opinion of the Court.

It is very plain, we think, that these principles do not apply. The land in question was conveyed by the debtor, not directly to the creditor, but to a stranger. That stranger, by virtue of the conveyance, held the legal title in trust for the purpose of sale according to the power contained in it. That power he executed in strict accordance with its terms. A default has been made by the debtor, and at the request of a part of the creditors he was required to sell the property at public auction to the highest bidder, without limit or condition, in order that the proceeds of the sale might be applied to the payment of the debt, to secure which the land had been conveyed in trust. The sale was made under the direction and control of the trustee, but, as the creditors who held the obligations of the debtors were not themselves trustees, there was nothing, either at law or in equity, to prevent their being bidders and becoming buyers at the trustee's sale. In reference to that sale they occupied no position towards the debtor of trust or confidence. They were charged in respect to it with no duty whatever. They had an interest in it that the property should produce enough to satisfy the debts which it had been given to secure. Beyond that they had neither interest nor duty, and in their own interest the creditors had a right to bid so as to prevent the property from being sacrificed at the sale below its value in order that it might be made to produce the largest amount towards payment of the debt.

The relation of a creditor secured by such a deed of trust to a sale made under a power given to a stranger as trustee does not differ from that of a mortgagee of real estate sold under judicial proceedings for foreclosure by a decree of a court of equity. At such a sale nothing is more common than for the mortgagee to become the purchaser; and it is as beneficial to the debtor as to himself that he should be permitted to enhance the competition at such a sale in order to protect his own interests. In that respect, his own interest coincides with that of his debtor, as it is for their mutual benefit that the property should not be sacrificed so as to leave any part of the debt unpaid.

It is argued, however, that in the present instance the sale

Opinion of the Court.

to Dexter was a sale only in form, and not in fact, because no money passed. This, however, is an error, because the whole amount bid by Dexter at the sale, which was the consideration for the conveyance to him by the trustee, was at once credited by the principal creditors, for whom he was acting as agent, as a credit of cash upon the overdue obligations of the debtor. In fact and in law it was a payment of money to the use and benefit of the debtors in pursuance of their authority.

In addition to this, there is another ground which equally supports the decree below. As already recited, the assignee in bankruptcy, in pursuance of an order of the court, sold and conveyed to Hermann all the interest which he as assignee and the Bowens as bankrupts had in and to the real estate in question; and by subsequent conveyances whatever title, if any, thereby passed has become vested in Dore for his use. All that was conveyed by the assignee to Charles L. Easton, the complainant in this suit, was the interest of the assignee and of the bankrupts "in all collaterals pledged with said bank by said bankrupts or either of them." If this can be considered as the conveyance of any interest in the real estate, it was ineffectual and void, because that interest had been previously conveyed by the same grantor to Hermann. If it is limited to the bonds of the Bowen Brothers secured by the deed of trust, it is equally ineffective, because there was nothing to convey. These bonds were the mere personal obligations of the bankrupts themselves, in which neither they nor their assignee had any right of property, and which had become extinguished as obligations in the hands of any one by the bankrupts' certificate of discharge.

For these reasons the decree of the Circuit Court is

Affirmed.

Statement of the Case.

CALLAN v. WILSON.

APPEAL FROM THE SUPREME COURT OF THE DISTRICT OF COLUMBIA.

No. 1318. Argued January 16, 1888. Decided May 14, 1888.

The provision in article 3 of the Constitution of the United States that "the trial of all crimes, except in cases of impeachment, shall be by jury," is to be construed in the light of the principles which, at common law, determined whether or not a person accused of crime was entitled to be tried by a jury; and thus construed, it embraces not only felonies punishable by confinement in the penitentiary, but also some classes of misdemeanors the punishment of which may involve the deprivation of the liberty of the citizen.

The provisions in the Constitution of the United States relating to trial by jury are in force in the District of Columbia.

A person accused of a conspiracy to prevent another person from pursuing a lawful avocation, and, by intimidation and molestation, to reduce him to beggary and want, is entitled, under the provisions of the Constitution of the United States, to a trial by jury. The Police Court of the District of Columbia is without constitutional power to try, convict, and sentence to punishment a person accused of a conspiracy to prevent another person from pursuing his calling and trade anywhere in the United States and to boycott, injure, molest, oppress, intimidate and reduce him to beggary and want, although the Revised Statutes relating to the District of Columbia provide that "any party deeming himself aggrieved by the judgment of the Police Court may appeal to the Supreme Court" of the District.

THE Court stated the case as follows:

This was an appeal from a judgment refusing, upon writ of habeas corpus, to discharge the appellant from the custody of the appellee as Marshal of the District of Columbia. It appears that by an information filed by the United States in the Police Court of the District, the petitioner, with others, was charged with the crime of conspiracy, and having been found guilty by the court was sentenced to pay a fine of twenty-five dollars, and upon default in its payment to suffer imprisonment in jail for the period of thirty days. He perfected an appeal to the Supreme Court of the District, but having subsequently withdrawn it, and having refused to pay the fine im