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to ascertain whether the time and place were proper, and generally to see that the pledgor's rights are properly protected." Thus, when the pledged goods are susceptible of division, and when, by a sale of part of the goods, a sufficient amount can be realized, it then becomes the duty of the pledgee to make such division and to sell only such portion of the goods.

The pledgee cannot become the purchaser at the sale. If he does, the sale is voidable as to the pledgor, and the pledgor has the right to treat it as a valid sale,10 or to treat it as void. If the pledgor elects to treat the sale as void, then the title to the pledge remains precisely as if no sale had been made, with the lien of the pledgee still on it for the amount of his debt.12

The interest of the pledgee in the goods pledged is only coextensive with the debt secured. Therefore, on a sale in any of the methods indicated in this section, any surplus remaining in the hands of the pledgee, after the satisfaction of his claims (i. e., the debt and necessary expenses of keeping and selling the pledged goods) be

Pac. 104, Dobie Cas. Bailments and Carriers, 138; Perkins v. Applegate, 85 S. W. 723, 27 Ky. Law Rep. 522; Schaaf v. Fries, 77 Mo. App. 346.

7 Kinnaird v. Dudderrar, 54 S. W. 847, 21 Ky. Law Rep. 1230; Sparhawk v. Drexel, Fed. Cas. No. 13,204; Barber v. Hathaway, 47 App. Div. 165, 62 N. Y. Supp. 329.

8 Fitzgerald v Blocher, 32 Ark. 742, 29 Am. Rep. 3.

Sharpe v. National Bank of Birmingham, 87 Ala. 644, 7 South. 106; Lord v. Hartford, 175 Mass. 320, 50 N. E. 609; Winchester v. Joslyn, 31 Colo. 220, 72 Pac. 1079, 102 Am. St. Rep. 30; Stokes v. Frazier, 72 Ill. 428; Killian v. Hoffman, 6 Ill. App. 200; MARYLAND FIRE INS. CO. v. DALRYMPLE, 25 Md. 242, 89 Am. Dec. 779, Dobie Cas. Bailments and Carriers, 130. But the pledgee may be given power to purchase by express contract. Chouteau V. Allen, 70 Mo. 290; Hamilton v. Schaack, 16 Wkly. Dig. (N. Y.) 423. The holder of collateral security cannot appropriate it in satisfaction of the debt at his own option. Diller v. Brubaker, 52 Pa. 498, 91 Am. Dec. 177. Where a pledgee is an agent or trustee, and is authorized by the pledgor to purchase the pledge in his own right in case of sale, a purchase by the pledgee in his own right is valid, as between him and the pledgor. Manning v. Shriver, 79 Md. 41, 28 Atl. 899.

10 Faulkner v. Hill, 104 Mass. 188; Killian v. Hoffman, 6 Ill. App. 200; Holston Nat. Bank v. Wood, 125 Tenn. 6, 140 S. W. 31.

11 Duncomb v. New York, H. & N. R. Co., 84 N. Y. 190; Glidden v. Mechanics' Nat. Bank, 53 Ohio St. 588, 42 N. E. 995, 43 L. R. A. 737; Leahy v. Lobdell, Farwell & Co., 80 Fed. 665, 26 C. C. A. 75; Hyams v. Bamberger, 10 Utah, 3, 36 Pac. 202.

12 Bank of Old Dominion v. Dubuque & P. R. Co., 8 Iowa, 277, 74 Am. Dec. 302; Bryson v. Rayner, 25 Md. 424, 90 Am. Dec. 69; MARYLAND FIRE INS. CO. v. DALRYMPLE, 25 Md. 242, 89 Am. Dec. 779, Dobie Cas. Bail. ments and Carriers, 130; Hyams v. Bamberger, 10 Utah, 3, 36 Pac. 202; Stokes ▼. Frazier, 72 Ill. 428. But the pledgor may ratify such a purchase. Hill v.

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longs to the pledgor. This surplus in no sense belongs to the pledgee, but is held by him strictly in trust for the, pledgor. The pledgee's interest is at best a special one for a special purpose; that purpose fulfilled, any residuum naturally reverts to the pledgor. Should the sale of the pledged goods fail to realize an amount as large as the amount of the debt, the pledgee may bring a personal suit against the pledgor for the deficiency.15

Sale in Equity

The common-law sale just considered, requiring no judicial proceedings, is ordinarily adequate for the pledgee, and is simple and inexpensive. Resort should be had to it, then, in all clear cases. But when there are intervening or conflicting rights,is when the rights and powers of the pledgee are in any way questioned or denied," when notice cannot be given to the pledgor 18 (upon which depends the validity of the common-law sale), then the safest course for the pledgee to pursue is to proceed by a bill in equity to obtain a decree from a court of chancery ordering the sale of the pledged goods. Such a decree would show due regard, in case of conflicting claims, for the rights of all concerned.

Finigan, 62 Cal. 426; Carroll v. Mullanphy Sav. Bank, 8 Mo. App. 249, Pledgor has a right of election to treat the purchase of the pledged property by the pledgee at his own sale as invalid, but loses such right by failing to exercise it within a reasonable time after being informed of the purchase Hill v. Finigan, 77 Cal. 267, 19 Pac. 494, 11 Am. St. Rep. 279. Pledgor's elec tion to treat the purchase of the pledged property by the pledgee at his own sale as valid cannot afterwards be retracted; nor can an election to disaffirm the sale be retracted or renewed at a later date, for the purpose of increasing the damages. Hill v. Finigan, 77 Cal. 267, 19 Pac. 494, 11 Am. St. Rep. 279.

13 Hirsch v. Mayer, 165 N. Y. 236, 59 N. E. 89; Union Nat. Bank v. Post, 192 Ill. 385, 61 N. E. 507; Whittaker v. Amwell Nat. Bank, 52 N. J. Eq. 400. 29 Atl. 203.

14 Fletcher v. Harmon, 78 Me. 465, 7 Atl. 271; Ponce v. McElvy, 47 Cal. 154; Du Casse v. Keyser, 28 La. Ann. 419; Graydon v. Church, 7 Mich. 36.

15 Mauge v. Heringhi, 26 Cal. 577; Jones, Collateral Securities (3d Ed.) § 597.

16 Halle v. National Park Bank of New York, 140 Ill. 413, 29 N. E. 727; Homer v. Savings Bank of New Haven, 7 Conn. 478; Merchants' & Farmers' State Bank v. Sheridan, 156 Ill. App. 25.

17 STOKES v. DIMMICK, 157 Ala. 237. 48 South. 66, Dobie Cas. Bailments and Carriers, 139; Boynton v. Payrow, 67 Me. 587; Briggs v. Oliver, 68 N. Y. 336, 339; Vaupell v. Woodward, 2 Sandf. Ch. (N. Y.) 143; Stokes v. Frazier, 72 Ill. 428; Sitgreaves v. Farmers' & Mechanics' Bank, 49 Pa. 359; Robinson v. Hurley, 11 Iowa, 410, 79 Am. Dec. 497; Arendale v. Morgan, 5 Sneed (Tenn.) 703.

18 Indiana & I. C. Ry. Co. v. McKernan, 24 Ind. 62; Stearns v. Marsh, 4 Denio (N. Y.) 227, 47 Am. Dec. 248.

Where an accounting,1o or other distinctive equitable remedy, or ground of equitable jurisdiction,20 is present, a court of chancery will also assume jurisdiction. But when none of the considerations herein discussed apply, resort cannot be had to equity, since there is an adequate remedy at law." The court decrees a sale, not an absolute foreclosure vesting absolute title in the pledgee.22

Sale under Power Given by the Pledge Contract

The parties may, at the time of creating the pledge relation, provide that, on default by the pledgor, the pledgee shall have power to sell the pledged goods on such terms as they see fit.23 Unless unduly oppressive or otherwise illegal, such contracts are controlling and will be duly enforced. Thus the time and manner of making the sale 24 may be thus fixed, the pledgor may dispose with the otherwise necessary notice, 25 or a private instead of a public sale may be permitted.20 Again, it may be stipulated that the pledgee shall have the right to purchase the goods at such sale." Sale under Statutes

In a number of states, sales of pledged goods have been made the subject of statutory regulation.28 Some of these statutes provide a cumulative remedy by affording an additional method of selling the pledged goods, the pledgee retaining besides the statutory method

19 Durant v. Einstein, 5 Rob. (N. Y.) 423; Appeal of Conyngham, 57 Pa. 474; Conde v. Rodgers, 74 App. Div. 147, 77 N. Y. Supp. 518.

20 Evans v. Goodwin, 132 Pa. 136, 19 Atl. 49; Thornton v. Thornton, 31 Grat. (Va.) 212; San Pedro Lumber Co. v. Reynolds, 111 Cal. 588, 44 Pac. 309. 21 Dupuy v. Gibson, 36 Ill. 197; Thames Ironworks & Shipbuilding Co. v. Patent Derrick Co., 1 Johns. & Hen. (Eng.) 93, 99.

22 Carter v. Wake, 4 Ch. D. (Eng.) 605; but the court may in its decree permit the pledgee to bid at the sale.

23 Lowe v. Ozmun, 3 Cal. App. 387, 86 Pac. 729; Nelson v. Wellington, 5 Bosw. (N. Y.) 178; Goldsmidt v. Trustees of First Methodist Episcopal Church in Worthington, 25 Minn. 202; Chapman v. Gale, 32 N. H. 141; In re Mertens, 144 Fed. 818, 75 C. C. A. 548.

24 Mowry v. Wood, 12 Wis. 413; Lowe v. Ozmun, 3 Cal. App. 387, 86 Pac. 729.

25 Williams v. United States Trust Co. of New York, 133 N. Y. 660, 31 N. E. 29; Union Nat. Bank of New Orleans v. Forsyth, 50 La. Ann. 770, 53 South. 917; McDowell v. Chicago Steel Works, 124 Ill. 491, 16 N. E. 854, 7 Am. St. Rep. 381.

26 Carson v. Iowa City Gaslight Co., 80 Iowa, 638, 45 N. W. 1068; Jeanes' Appeal, 116 Pa. 573, 11 Atl. 862, 2 Am. St. Rep. 624.

27 Barry v. American White Lead & Color Works, 107 La. 236, 31 South. 733; Appleton v. Turnbull, 84 Me. 72, 24 Atl. 592; Hiscock v. Varick Bank of New York, 206 U. S. 28, 27 Sup. Ct. 681, 51 L. Ed. 945.

28 See Jones, Collateral Securities (3d Ed.) §§ 616-630, for an analysis of these statutes in many of the states, with citations of cases construing them.

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those methods existing in the absence of statute. Other statutes, however, are exclusive in their operation, taking away completely the power to sell at common law or under the power given by the pledge contract, leaving the statutory method as the only way in which the sale can be made. General observations on these stat

utes would avail little here. The specific statute should in each case be carefully consulted and then scrupulously followed.

TERMINATION OF THE PLEDGE

89. The pledge may be terminated by:

1. Act of parties.

(a) By performance of the obligation secured, or tender thereof, by the pledgor.

(b) By valid sale of the pledged chattel by pledgee on pledgor's default.

(c) By consent of the pledgee.

(d) By redelivery of the pledged article to the pledgor.
(e) By conversion or like wrong of the pledgee, at the
pledgor's option.

2. Operation of law.

(a) Destruction of the pledged chattel.

Neither death nor other change in the legal status of the parties terminates the pledge.

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Of all bailments, the pledge, perhaps, presents the least difficulty as to its termination. The special property of the pledgee is undisputed, while his power of sale, binding on the pledgor when exercised, rises to the dignity of a power coupled with an interest,31 and is therefore governed by the rules of agency applicable thereto. Acts of the Parties-Performance or Tender

The usual way of putting an end to the pledge by the pledgor is the payment of the debt or performance of the engagement secured. The debt includes (as we have seen) expenses necessarily incurred by the pledgee in keeping the pledged chattel. On such payment or performance, the whole reason for the creation and continued.

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29 This is the situation, unless the statutory intention is clear in excluding all remedies save that granted by the statute. Taft v. Church, 162 Mass. 527, 39 N. E. 283. See, also, Jones v. Dimmick (Ala.) 59 South. 623.

80 Ante, § 79.

81 Henry v. Eddy, 34 Ill. 508; Chapman v. Gale, 32 N. H. 141; De Wolf v. Pratt, 42 Ill. 198; Renshaw v. Creditors, 40 La. Ann. 37, 3 South. 403.

2 Ante, § 82.

existence of the pledge ceases. The pledge, therefore, immediately terminates. Payment need not be in money, and anything that is the legal equivalent of payment operates to terminate the pledge.35

A proper tender of performance or payment also serves to terminate the pledge as effectively as an actual performance or payment.36 As the pledgee holds the pledged goods solely in order to enforce payment or performance, after a tender, which offers to him the fullest fruits of the transaction to which he can be entitled, the pledgee's holding is no longer a rightful one." Any other rule might indefinitely obstruct the pledgor's right of redemption. To constitute a good tender, it is not necessary that the money be paid, nor even, when the pledgor's offer is refused by the pledgee, that the pledgor actually produce the money.38 The

33 Tate v. Security Trust Co., 63 N. J. Eq. 559, 52 Atl. 313; Gage v. McDermid, 150 Ill. 598, 37 N. E. 1026; Merrifield v. Baker, 9 Allen (Mass.) 29; Wilson v. Shocklee, 92 Ark. 370, 123 S. W. 403; Herrmann v. Central Car Trust Co., 101 Fed. 41, 41 C. C. A. 176. But part payment does not discharge the lien on the pledged goods. Herman Goepper & Co. v. Phoenix Brewing Co., 115 Ky. 708, 74 S. W. 726; Williams v. National Bank of Baltimore, 72 Md. 441, 20 Atl. 191.

84 Strong v. Wooster, 6 Vt. 536; Bacon v. Lamb, 4 Colo. 578.

35 Leighton v. Bowen, 75 Me. 504; Lathrop v. Adkisson, 87 Ga. 339, 13 S. E. 517; Hermann v. Central Car Trust Co., 101 Fed. 41, 41 C. C. A. 176. A pledgee may, by his misconduct with respect to the thing pledged, become liable to the pledgor for depreciation or loss in value in consequence of his negligence, but when the value of the thing pledged is lost through the negligence of the pledgee, it does not operate, ipso facto, as a satisfaction or extinction of the debt to the extent of the loss. Cooper v. Simpson, 41 Minn. 46, 42 N. W. 601, 4 L. R. A. 194, 16 Am. St. Rep. 667. Money collected by a creditor on a note received as collateral security, which the creditor has power to convert into money, operates, pro tanto, as payment of the secured debt. Hunt v. Nevers, 15 Pick. (Mass.) 500, 26 Am. Dec. 616.

36 Ryall v. Rowles, 1 Atk. (Eng.) 165; Latta v. Tutton, 122 Cal. 279, 54 Pac. 844, 68 Am. St. Rep. 30; Moyer v. Leavitt, 82 Neb. 310, 117 N. W. 698, 130 Am. St. Rep. 682; Hathaway v. Fall River Nat. Bank, 131 Mass. 14.

37 Haskins v. Kelly, 1 Rob. (N. Y.) 160; McCalla v. Clark, 55 Ga. 53; Mitchell v. Roberts (C. C.) 17 Fed. 776; Humphrey v. County Nat. Bank of Clearfield, 113 Pa. 417, 6 Atl. 155; Loughborough v. McNevin, 74 Cal. 250, 14 Pac. 369, 15 Pac. 773, 5 Am. St. Rep. 435; Norton v. Baxter, 41 Minn. 146, 42 N. W. 865, 4 L. R. A. 305, 16 Am. St. Rep. 679; Hicks v. National Life Ins. Co., 9 C. C. A. 215, 60 Fed. 690; Hyams v. Bamberger, 10 Utah, 3, 36 Pac. 202. Pledgee is answerable for depreciation in value of pledged property, after he has refused to accept a valid tender of the debt, and a demand for the possession of the property; and this is equally true whether an action is brought against him as for a conversion, or a bill is filed against him to redeem from the pledge. Loughborough v. McNevin, 74 Cal. 250, 14 Pac. 369, 15 Pac. 773, 5 Am. St. Rep. 435.

* Hazard v. Loring, 10 Cush. (Mass.) 267.

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