The opinion of the Court was delivered by
Willard, C. J.The report of the Referee fully explains the nature of the present case and the facts and circumstances out of which it has arisen. The findings of fact of the Referee will be first considered.
The proposition advanced by the defendant, that the plaintiff had lost her right to call him to account as trustee, and also to dispute the character of certain investments on the ground of acquiescence and laches, is met by a finding of the fact that the plaintiff was not, during the time to which such allegation relates, sufficiently informed of the nature of the trust and of her interest under it to be subject to the charge of acquiescence or of laches. To disturb that finding of fact, we must conclude that it is unsupported by the evidence, either as a fact not proved or as an improper inference from facts proved, or we must conclude that the clear weight of undisputed evidence is against it. We find no ground for such a conclusion. It was incumbent on the defendant to establish facts of that character by clear proof.
The interest of the plaintiff during the lifetime of her mother was that of one in remainder, having no present right to control the fund, directly or indirectly, or to enjoy the income of the trust estate. She had a right to hold her hands off from the estate until her right became vested in interest by the happening of the contingencies on which her right of possession depended. She had no duty to discharge in compelling the trustee to a proper discharge of his duty and keeping him within the strict line of that duty. The duty of keeping the trust estate in a safe condition, so that it might come in due time to the hands of the plaintiff, devolved upon the defendant and not upon the plaintiff. Under such circumstances, very clear evidence of an intention on her part to authorize a clear departure from the terms of the trust would have to be produced to warrant the conclusion contended for by the defendant. It is equally clear that the absence of a defined duty of watchfulness and objection on the part of the plaintiff during the *488period of time referred to prevents the application of the principles upon which laches is charged.
The conclusion of the Referee as to this part of the case must be affirmed.
The findings of the Referee were objected to on the ground that he had included in his statement of the assets of the trust estate in the hands of the trustee to be accounted for a bond of A. & A. Huger for 82,283, while it is alleged that no part of the assets went into that bond. The statement of the account made by the Referee is largely derived from memoranda coming from the defendant’s custody. These memoranda appear to be necessary in order to state the account of the trustee, as it appears that his books and papers were destroyed through casualties of the late war, and no more direct proof of the accounts being offered by defendants. The character of these memoranda justifies their employment as means of stating the account. Indeed, no objection is made as to their sufficiency as proof of the accounts, but the objection is as it regards the conclusions to be derived from them. We do not find any evidence that the Referee has misinterpreted these proofs or given them undue weight. Certainly the conclusion he has drawn is a fair and reasonable one to derive from the face of the memoranda. The circumstance that the defendant, although a witness in the case on his own behalf, did not give any testimony as to any such objection to the memoranda, affords strong reason to assume that there was no substantial ground of objection to their statements. The fact stated, that length of time had rendered the memory of the defendant indistinct as it regards the state of accounts, cannot help the defendant, for the burden of disputing the representations that appear on the face of the memoranda was upon him. The finding of the Referee as it regards the Huger bond, holding it to have been part of the trust estate to be accounted for, must be sustained.
We find no ground for disturbing the remaining findings of the Referee. We can neither say that they are unsupported by evidence nor that they deny the due force of evidence. It remains to consider the questions of law raised in the findings of the Referee.
We think that the reasoning and conclusion of the Referee as it regards the Earle bond were correct.
It is certainly a breach of trust for a trustee to place trust funds in encumbered property, where it is probable that the trust estate *489may be called upon to redeem from such encumbrance and may be seriously embarrassed, if not unable, to effect such redemption. This manifest inconvenience lies at the foundation of the rule stated in Nance vs. Nance, (1 S. C., 209,) as it regards investing in encumbered property. In the present case the real property mortgaged was affected by the lien of a large judgment. Whether the negroes that constituted part of the mortgage security were subject to the lien of execution on the judgment does not appear. It is said that property sufficient existed, bound by such judgment, without resort to the property mortgaged; but there was no legal means of compelling the judgment creditor to look to any particular fund, bound by his judgment, and, if there was, still the trust estate would be in the position of having purchased a law suit. It is hardly conceivable that circumstances could exist justifying investment by a trustee in property bound by a judgment. It is not enough to justify an investment that the property bound by a security is amply sufficient to meet its obligation. The nature of the security, and the circumstances affecting its availability, must be such as to afford means, consistent with the nature of trust estates, as well as with the circumstances of the particular estate, of obtaining security for the trust fund and reasonable productiveness. As was said in Nanee vs. Nanee, the highest rate of productiveness is not required, because ordinarily inconsistent with the requisite security. As to what is a sound investment, in point of availability, is not a question to be determined wholly by the judgment of the trustees as to the degree of risks attending a particular investment, but is determined, in part at least, in accordance with the rules that are the results of general business experience, to some extent recognized as fixed rules of legal administration. Nothing is of greater public importance than that that portion of the stored-up wealth of the community which usually falls into fiduciary custody should be wisely and prudently guarded and employed, not only as securing economic results, but in order to discharge a responsible duty to those who have claims upon the guardianship and protection of the State.
To hold that the investment as to the Earle bond was justifiable would tend to destroy the safeguards surrounding the discharge of fiduciary duties and leave the security of trust estates to the uncertainty of irregular business transactions and to the inaccuracy of speculative authorities.
*490Other circumstances affecting the value of the investment are stated by the Referee that need not be considered. His conclusion as to the insufficiency of that part of the property not bound by the judgment, and which we find no reason to question, is fatal to the support of the investment.
The Huger bond appears to have been a personal security merely. Such securities are not in themselves admissible, and can only be made so by evidence of the necessity and prudence of such investment. — Nance vs. Nance and Allen vs. Gaillard, 1 S. C., 279. No attempt was made by the trustee to explain such unsecured investment. It was no doubt the duty of the trustee to call in such improper investment at the earliest practicable moment.
It is not necessary to consider whether he had the right to convert that bond into Confederate currency, considering that it was inadequately secured, and, on the other hand, that the only medium of effecting such change of securities at the time was Confederate currency. — See Mayer vs. Mordecai, 1 S. C., 383. Confederate currency was uot money, in a legal sense, and, therefore, receiving Confederate 'currency at a nominal value was not payment in a legal sense. In legal contemplation, Confederate currency was a mere commodity, used by the community as a matter of necessity or convenience as a medium of exchange. In converting a security into Confederate currency the same rules were required to be observed as in case of barter or exchange of one kind of property into another not having the legal character of money — that is to say, regard must be had to its actual value and not to its nominal value. It appears that the Confederate currency was not at the time worth its nominal value, and, therefore, could not properly be taken at such value.
It was, therefore, a clear breach of trust for the trustee to convert the Huger bond into depreciated Confederate currency at its nominal value. — Mayer vs. Mordecai, 1 S. C., 383; Sanders vs. Rodgers, 1 S. C., 452; Womack vs. Austin, 1 S. C., 421; Cureton vs. Wilson, 3 S. C., 451.
Inasmuch as the trustee both invested in and converted the Huger bond improperly, he is properly chargeable with the value of the assets represented by the security converted at the time of such conversion. It does not appear that any actual value has been derived from the conversion ; accordingly the trustee should stand charged with the amount of that bond.
*491We are equally satisfied with the conclusion of the Referee as to matters of law as it regards the Milliken bond. His conclusion of fact that the security afforded by that investment was sufficient in point of fact, independent of that portion of the property mortgaged that was subject to prior liens, we are constrained to adopt as subject to none of the objections that are allowed as sufficient to disturb findings of fact. The question of law arises, from this state of facts, whether a mortgage security taken upon slaves is admissible under any circumstances and whether authorized in the case in hand. Slaves at the time constituted an important element of landed securities, at least so far as they were permanently connected with agricultural pursuits. No other kind of personal property stood in like relation to land. While land possessed the value due to the highest indestructibility, slaves had the advantage of increase.
The plantation and its slaves were usually considered together as it regarded the value of agricultural lands. It would be stating the rule with too much attention to technical considerations to lose sight of this fact. The habits and customs of the country must be allowed weight, and it is clear that investments in land and slaves engaged in their culture was regarded as the highest security of a private nature and appropriate and safe for the purposes of security. We are thus constrained to treat the land and the slaves as constituting a single subject of investment in the present case, for in their union lay the element of landed value to which security should look and as substantially a real security.
It appears that one part of the property mortgaged was subject to prior liens, but another part was free from .such prior liens, and, by the finding of the Referee, that part not affected by prior liens was sufficient in itself to put the money loaned in a reasonable state of security. The objection of a prior lien in such case does not go to the sufficiency of the security but presents merely a question of technical compliance with the formal requirements of such investments, and as such it must yield to the evidence of substantial compliance with the requisites of good investment.
As it regards the claim for commissions by the trustee, we need not consider the abstract question raised. The defendant came before the Court, in his answer, denying the existence of the trust, and contending that, contrary to the intent of the trust, he had turned over all the assets of the trust estate, many years ago, into *492the hands and exclusive control of the life tenant, without regarding the claims of those entitled to take by way of remainder after termination of the life estate. He claims that the trust itself was terminated by that act. This was a clear breach of trust. The defendant claims to have acted since that time as the agent of the life tenant merely — in other words, that he has not acted from the responsibility imposed by the duty of a trustee for that time. It is not a case for the allowance of commissions, assuming that they could be allowed. Such a claim must rest upon the due performance of the duties imposed by the trust, and when these duties are unperformed it is not demandable either at law or in equity. The answer only demands commissions in case the defendant “ is held liable for the mischances of the fund.” The defendant has not been held liable for “ mischances,” but for a departure from a clear line of legal duty. No equity exists to extend the demand of the answer beyond its direct sense.
The report of the Referee and the decree of the Court upon it must be affirmed and the cause remanded for further'proceedings.
McIver, A. J., and Haskell, A. J., concurred.