The court adopted the opinion of the special term; but modified the decree so as to allow the defendant to pay the instalments due, per statute; in other respects the judgment was affirmed with costs. The following opinion was delivered at special term :
Johnson, Justice.The debts against the estate were not a charge upon the real estate devised to Gamaliel G. Townsend by the will. They are not made so by the terms of the will, nor is there anything in the will from which it can be inferred that such was the intention of the testator. There was, beyond all dispute, sufficient personal property to pay all the debts, and there was no reason for making any such charge. Gamaliel was charged personally with the-payment of the debts in reference solely to the personal estate bequeathed to him, as appears plainly upon the face of the will. There having been personal property sufficient for the payment of all the debts, the land devised could not have been charged in any event. The devisee might possibly have been charged by action in respect of the land devised after the lapse of three years from the granting of letters testamentary.
But I do not regard these considerations of any great *190importance in this case. As some one must suffer from the acts of Gamaliel, ought the loss in equity to fall upon the plaintiffs or the defendant ? Asa general rule, the assignee of a bond and mortgage is put upon inquiry, and takes them subject to all the existing equities between the mortgagor and mortgagee when the latter parts with his interest. But this rule, like all other general rules, has its exceptions. Undoubtedly, as between the defendant and Gamaliel, the latter was liable for the payment of these debts. He had the assets, and was, by the will under which he took, charged with their payment personally. But it does not follow from this, certainly, that these debts which the defendant has paid should be charged upon this mortgage. The defendant paid the debts as executor. He had, as such executor, the moment he qualified, the right to all the personal estate, until the debts were paid and satisfied. He knew, as the evidence shows, the existence of the principal debts at the decease of the testator, which he subsequently paid. It was his duty to see to their payment, and to know whether they were paid or not at the time he purchased of Gamaliel and gave him the bond and mortgage in question. I think the assignee of the mortgage, knowing that the mortgagor was one of the executors, would have the right to assume, without inquiry, that the debts of the estate were all satisfied—at least, so far as the real estate mortgaged was concerned. In addition to this, the defendant had made a payment upon the mortgage to the second assignee before it was assigned to the plaintiffs, and before any payment became due, which was endorsed, and which was a notice to any subsequent assignee, that the defendant acknowledged the obligation as valid and binding upon him. No question is made but that the plaintiffs are bona fide assignees so far as any actual notice is concerned, and for a valuable consideration, and it seems to me that the defendant, situated as he was in reference to the .debts of the estate at the time he *191gave the bond and mortgage in’question, and having made one payment thereon, to a person who held as assignee before the assignment to the plaintiffs, ought not to be allowed to recoup the debts paid by him out of the bond and mortgage in question. He knew, or might have known, the pecuniary condition of Gamaliel, and ought to have known how the affairs of the estate stood when he purchased the land devised, and gave his obligation, secured by the mortgage, for the purchase price. But having neglected his duty in this respect, he is in the situation of one who has carelessly and negligently put it in the power of Gamaliel to assign the obligations, and thus impose upon innocent third persons, and should bear the loss. And the more especially after having made a payment to the plaintiffs’ assignors. I am of opinion, therefore, there is in equity no set-off or charge against the bond and mortgage in question in the hands of the plaintiffs. Consequently the plaintiffs are entitled to the judgment asked for in the complaint.