TERM, 1870.] Lester . Hoskins, Heiskell & Co. authorize the interposition of a court of equity on the facts stated is, that the appellant was too sick to appear and defend in the court at law. The defendants, as has been stated, required strict proof upon this point, and none is given; in fact the appellant makes no proof of any controverted allegation in the bill. Green P. Nunn, it seems, held the receipt of Lester for the note, and was the attorney for Hoskins, Heiskell & Co.; he died. His executor delivered it to James C. Marain, who called on Lester for the money. Marain testifies that Lester offered to pay the sum due on the note to him in July of 1860, but that he would not agree to pay the interest, and that he, Marain, would not receive the principal without the interest. Marain also states, that he contracted with a partner of Lester's for some land, and that it was agreed that $100 00 should be credited on the note; that Lester was informed of this fact, and refused to do it on the ground that the defendants were residents of the State of Pennsylvania and that the debt was confiscated to the Confederate States. No claim seems to have been set up by Lester, at the time alluded to, that he had not realized the money out of the assets of Glasscock & Co., and he presents no evidence in support of that position. The offer to pay the note, less the interest, can hardly fail to carry conviction to the mind that Lester must have realized, at least, the amount he offered to pay, out of the assets of Glasscock & Co. He at no time, before the beginning of the suit, placed his refusal to pay the note on the ground that he had not realized the money out of the assets in his hands. The judgment of the circuit court of Lawrence county is affirmed with costs, and ten per centum damages. 5 McClure v. McDearmon. MCCLURE v. McDEARMON. [DECEMBER EQUITY-Liens.-A sale or lease by one joint-stock owner of his joint interest to the other for a valuable consideration, reserving, by trust deed, a lien on the joint stock interest and the increase thereof in the line of business, is a continuing security, enforcible in equity, between the parties and their privies, with knowledge of the prior incumbrance. Appeal from Independence Circuit Court. HON. ELISHA BAXTER, Circuit Judge. Watkins & Rose, for appellant. A mortgage will not pass chattels not in existence at the time it was made, or not in the ownership of the mortgagor at the time. 1 Hilliard on Mortgages, p. 6; 2 Ib., ch. 42, sec. 4, p. 479, and cases cited, particularly Moody v. Wright, 13, (Mass.) 20, 39; Winslow v. Merchants, etc., 4, 2d, 306; Bernard v. Eaton, 2 Cush., 294; Codman v. Freeman, 3d Ga., 306; Otis v. Sill, 8 Barb., 102; Gardner & McEwen, 19 N. Y., 123; Chapin v. Cram, 40 Maine 561; Cudworth v. Scott,41 N. H., 476; Rose r. Bevan, 10 Md., 466. The mortgage, in this case, did not even bind the forty logs and the fifteen cords of wood on hand, at the time Ingram sold to McClure, because it is no where shown or even claimed in the bill, or elsewhere, that Ingram had them at the time he made the mortgage, which was six months before the sale by Ingram to McClure. See Hamilton v. Rogers, 8 Md., 301; 2 Hill on Mort., ch. 42, sec. 22, p. 398. The notion on which the decree is based, that A. may pledge, by mortgage, the after-acquired property of B., seems never to have been thought of before-certainly it has never been put in print. We submit, then: 1st. That the injunction should have been dissolved, except as to the forty logs and the fifteen cords of wood. TERM, 1870.] McClure . McDearmon. 2d. That the injunction ought to have been dissolved altogether, there being no evidence that the logs and wood belonged to Ingram, when the mortgage was made, or that they were at the mill when the suit was brought. Byers & Cox, for appellee. If the mill and lease were real property, a covenant to pay rent would run with the realty. 4 Kent, 473, and n. b. But we will treat the lease, in this case, as being upon personal property. The lease by McDearmon to Ingram being but for one year, was a personal chattel. 2 Kent, 342 and n. b.. 1st. It is a principle of universal application in equity, that all kinds of property, whether real or personal, capable of being sold, may be mortgaged in conformity to the maxim of the civil law, "Whatever may receive purchase and sale, may also receive hypothecation." Rents, franchises, choses in action, possibilities, coupled with an interest, etc., may be mortgaged.. 2 Story Eqt., sec. 1021. Things having a potential existence, and contingencies and possibilities coupled with an interest, a single hope or expectation of means, founded on a right in esse, are capable of sale (and, consequently, of mortgage) at law. 1 Bouv. Inst. Nos. 599 to 602; 2 Kent, 468 and n. g.; 2 Kent, 401 and n. b.; 1 Parsons on Con., 523. And we refer specially to the case of Iibblewhite v. Me Morine, 5 M. and W., 462, cited at length in the last named note, overruling the doctrine that the sale of property, to which the vendor has no title, and which he intends, at the time of sale, to go into the market and buy, is void and cannot be enforced. The doctrine at law requiring the existence, actual or potential, of the thing sold or assigned, falls far short of that now entertained by the courts of equity, for they will support the assignments of contingencies and possibilities having no potential existence, but resting in mere possibility; not as a transfer to operate in presenti, but to take effect and attach as McClure v. McDearmon. [DECEMBER soon as the thing comes in esse. 2 Story Eqt., sec. 1040, and the authorities cited in the notes to that selection; also, Secs. 1040, c. and notes: 1040, d. and notes; 1055, and notes; 2 Story Eqt, se 1021; 1 Ma ., ch. 54; Adam's Eqt., 54: Kent's Com., 468, and n. g. In the case now before the court, the mortgage or deed of trust given by Ingram, gave the appellee the right and power to seize the property mortgaged, as soon as it come in esse, and there was a default in payment by Ingram. Ingram made default; the property mortgaged come into being and the appellee executed the power vested in him as mortgagee and trustee, by seizing the property, and the mortgagor, and his privies in estate, are estopped from now questioning the mortgagee's lien thereunder. Moody v. Wright, 13 Met. 17; 2 Story Eq. sec. 1040 and n. 3, 6 and 7; 2 Story Eq. sec. 1040 and n. 8; Holroyd r. Marshall, 6 Jurist, N. S. 931; Hose v. Haly, 5 El. and Bl. 845; 2 Jurist, N. S. 486; 1 Parsons on Contracts, 570, 1 and N. S. and T; Congress v. Evetts, 26 E. L. and Eq. 493; Wood v. Luster, 29 Barb. 145; Van Hosyer v. Cory, 34 Barb. (N. Y.) 10; Cudworth v. Scott, 41 N. Hamp. 456: Beaumont v. Crane, 14 Mass. 400. All of which authorities are cited in 2 Kent (11th Ed.) 616, n. 5. GREGG, J. On the 27th of August, 1868, the appellee presented his bill of complaint to the chancellor of Independence county, and prayed an injunction against the appellant, which was awarded and the bill filed in the office of the clerk of that county. The complainant alleged that on the third of May, 1867, he and William Ingram, jointly owned a saw mill, machinery, etc., for running the mill and manufacturing lumber, and also a lease for four years, from November, 1866, of the ground on which the mill stood; that he owned one-third and Ingram two-thirds; and that they could not agree in jointly running the mill, and by arbitration, it was agreed that Ingram should TERM, 1870.] McClure v. McDearmon. run the mill from August 1, 1867, to August 1, 1868, for the use of which he was to pay the appellant $600, and certain expenses to be incurred. And the appellee was to have a lien upon the stocks and on the lumber cut, within the year, to secure quarterly payments. The award was signed and recorded, and on the third of August, 1867, Ingram executed four writings obligatory, and a deed of trust on the stocks and lumber to be cut, to secure the payment. The deed was recorded; at maturity the first obligation was paid off. On the first of November, 1867, Ingram delivered the mill, etc., to the appellant, and by deed of January 16, 1868, conveyed to him all his interest in the mill and apparatus connected therewith. He also alleged that appellant had seen the deed from Ingram to him, and was notified that he would hold appellant for the payment of the writings obligatory, not satisfied; that appellant received from Ingram sixty logs, worth $150, and used the same; and that on the 31st of July 1868, the appellant had forty-seven thousand feet of lumber that had been cut on the mill, within the preceding year, on which appellee claimed a lien for the payment of the obligations; that Ingram was insolvent, and that appellant would sell the lumber if not restrained; that appellant held the same, and would not return it or pay the rents due. The prayer of the bill was, that an account be taken between the three; that whatever might be found due to appellee be declared in his favor, on said lumber; that appellant be restrained, etc. The bill was taken pro confesso, as to Ingram. McClure, by answer, admitted the original ownership of the mill, lease, etc., as charged; admitted that he knew of the writing from Ingram to McDearmon, "called a deed of trust," at the date of his purchase, but denies that Ingram had any logs or lumber at that time; alleges that he held, as Ingram's agent, from November, 1867, to 16th January, 1868, at which time he assumed the balance Ingram owed Ramsey for In |