REAL ESTATE CHARGES BILL. (Hansard, 24 July 1854)

§ EARL FORTESCUE
moved that this Bill be now read a second time, which he said had been sent up for their Lordships' approval from the other House of Parliament. The Bill was intended to make a salutary alteration in the law relative to charges upon real estate. Those Members of their Lordships' House who were conversant with the law of real property were aware that, by the law as it at present stood, if a man borrowed a sum of money and gave a mortgage on his real estate for the same, and afterwards died intestate or without specially providing for the exemption of his personal property from the charge on the real estate, the whole of his personal property would be taken to discharge the debt before the estate on which the mortgage existed could be rendered liable. This state of the law had given rise to many cases of hardship and injustice. He knew many cases in which the most lamentable consequences had ensued from ignorance of the law in this respect. In one case, a man had purchased a house and lands worth 1,500l., 700l. of which he paid, leaving the remaining 800l. as a mortgage upon it; he died suddenly and intestate, leaving an eldest son, twenty-two years of age, and six younger children. The eldest son took out letters of administration, called in the personal estate belonging to the father, with whicl1 he cleared the estate of the 800l. mortgage, and left his brothers and sisters to come upon the parish. This was a case of intestacy; and he would 585 now relate to their Lordships a case of hardship under a will. A gentleman died, leaving an only daughter, to whom he bequeathed all his personal property, leaving to a distant relative an estate charged with a heavy mortgage. The father of course expected that his daughter would receive the entire of his personalty without deduction, but the devisee of the landed property claimed to have the debt upon the estate paid out of the personalty, and several thousand pounds were thus deducted from the inheritance which the father believed he had left his child. These were two cases of very recent occurrence. The object of the Bill was in no wise to interfere with wills or with settlements, but simply to give effect to the intentions of testators, and he hoped their Lordships would sanction it. The first clause of the Bill provided that where no provision was made by will to the contrary, all mortgages should be defrayed out of the property mortgaged, and the second clause provided that where a party directed his property to be sold for the payment of incumbrances, it should be treated as personalty instead of realty.
Moved, That the Bill be now read a Second time.

§ LORD REDESDALE
said, he felt bound to oppose the second reading of the Bill, which he regarded as a step towards altering the law of succession of landed property in this country. He was not convinced by any of the arguments of the noble Earl that such a Bill was necessary. The case quoted was one in which the will had failed to carry out the wishes of the testator, but this occurred on many occasions, and was not a sufficient reason for a change in the law. He moved that the Bill be read a second time that day three months.
Amendment moved, to leave out the word "now," and add the words "this day three months."

LORD CAMPBELL
was sorry to hear that there was any opposition to the Bill, having believed that a measure which was so much in accordance with the dictates of justice and equity would have passed unanimously. The Bill did not interfere with the law of primogeniture, to which he was as much attached as any of their Lordships; and when in the House of Commons he had opposed a Bill providing that, in case of intestacy, the land should be equally divided amongst the children. It did not interfere with real estate in the 586 least degree, but merely enacted that personal estate should be divided as personal estate, among the widow and children, instead of, as in many cases now, the whole of it in fact going to the heir. It merely corrected a doubtful decision of the courts of equity. In Scotland they had no such absurd law as that existing in England, and yet there the laws of primogeniture were in full force and effect. He trusted the Bill would be read a second time.

§ EARL GRANVILLE ,
on behalf of a noble and learned Lord (Lord St. Leonards), who was unavoidably absent, suggested the propriety of reading the Bill a second time pro formâ, and delaying further discussion upon it until it went into Committee.

THE DUKE OF ARGYLL
supported the second reading of the Bill, and thought it astonishing that so unjust a regulation as that with which it proposed to deal could ever have existed in England.

THE LORD CHANCELLOR
said, the House ought to know exactly what the law was before they came to a vote upon the matter; for he thought that if the law were well understood, there could not be two opinions as to the justice of the measure. Suppose a man inherited an estate from his father that was charged with a mortgage of 10,000l., that he also possessed 10,000l. in the funds, and died intestate, leaving an eldest son and several other children; the law in that case gives the estate to the eldest son, but gives it cum onere—that is, subject to the mortgage—and the personalty is divided amongst all the children; but suppose the man had inherited the estate free from any charge, or had purchased it and afterwards mortgaged it, investing the mortgage money in the 3 per cents, and then died intestate, any person would say that the same rule ought to apply; but the law steps in and says the mortgage is a debt, and must be paid out of the personal property, to the injury of the younger children. This evil is proposed to be corrected by the first clause. He hoped there would be no opposition to the Bill. He would not consent to anything that would shake the institution of primogeniture; but it seemed to him that the refusal to pass such a measure as that before the House was the surest means of bringing that institution into discredit. If they agreed to the first clause they would necessarily agree to the second, which carried out the same prin- 587 ciple. It was to this effect—that when a testator directed real estate to be sold for the payment of debts, any surplus remaining after the discharge of the debts should be considered as personal property, and not retain the character of real estate, as it did under the present law. The proposal, in fact, was, that where there was no direction the property should go in the manner in which it might be fairly supposed to have been intended. He hoped the Bill would be allowed to pass the second reading.

THE MARQUESS OF BATH
said, that the tendency of the existing law was to keep real property together; but this Bill, if passed, would have a tendency to sever it. It was clear that the object of those who had introduced the Bill in the other House was to destroy the law of primogeniture, and to favour personal against real estate. He trusted their Lordships would refuse to sanction the measure.

§ THE EARL OF HARROWBY
thought that, as the object of the Bill was merely to make reasonable and just what was now most inequitable and unjust, it ought to be agreed to by their Lordships. He did not, however, altogether understand the operation of the measure.
After a few words from Lord CAMPBELL in explanation, as to the effect of the Bill upon creditors, showing that it would not in any way affect their rights, LORD REDESDALE said, he would not divide the House, on the understanding that the Committee should not be taken before Monday.
Motion (by leave of the House) withdrawn.
Bill read 2^a.