delivered the opinion of-the Court:
On November 11, 1890, the defendant in error filed in the Probate Court of Cook County against the estate of James M. Gamble, deceased, proof of a claim held by it against said estate, consisting of two notes executed to it by said Gamble in his life-time, and secured by a certain collateral. The plaintiffs in error as administrators of the estate objected to the allowance'of the claim. It came up for trial before the Probate Court on February 6, 1891, and was then heard and taken under advisement by that Court. It was held under advisement until November 2, 1891, on which day it was allowed for the amount hereinafter stated. It is conceded that the estate is insolvent, and unable to pay more than a small percentage upon the amount of its indebtedness. In August, 1891, the Bank, defendant in error, disposed of the collateral held by it as security, realizing therefrom an amount which was a little more than one 'third of the amount due to it, fоr principal and interest* upon its notes. The allowance made by the Probate Court was for the balance of the claim, as filed and proved upon the hearing, after deducting therefrom the net amount realized from the collateral. Upon appeal to the Circuit Court, the latter Court gave judgment for the full amount due upon the claim, but with a proviso that whatever the Bank should receive -in dividends from the estate, added to the amount rеalized by it from its collateral, should' not exceed the amount actually due to it upon its claim. The judgment of the Circuit Court has been affirmed by the Appellate Court, and such judgment of affirmance is brought here for review by writ of error.
The question presented is this: where a creditor, holding a claim secured by сollaterals, against the insolvent estate of a deceased person, files and proves his claim for the full amount in the Probate Court, and has a trial of it before the Court upon its merits, and, after it has been so filed and proved and tried, realizes from his collaterals a sum which is less than the amount of his claim, is he entitled to" a dividend upon the whole amount of his claim as proven, or only to a dividend upon the difference between such amount and the sum realized from his collateral security ? In In re Bates,
"We see no reason why thе same principle is not applicable in the distribution of pro rata dividends upon claims filed and proved in the Probate Court against the estatеs of deceased insolvents. (Mason v. Bogg, 2 Mylne & Craig’s Ch. Rep. 443 ; Kellock’s Case and Ex parte Alliance Bank, L. R. 3 Ch. App. pages 709 and 771; West v. Bank of Rutland, 19 Yt. 403). A creditor, secured by collaterals, is permitted to prove his claim for the full amount, because he has the double right of suing the debtor personally on the debt itself, and also of realizing from the property pledged "as security. He may sue on the principal debt before resorting to the security. (Cushman v. Hayеs,
In the absence of express agreement to that effect, the pledgee is not obliged to sell the property pledged at a specified time, even when requested to do so by the pledgor. (Badlam v. Tucker,
It makes no diffеrence in the application of the rule, permitting an allowance of the full claim and dividends upon the full claim as so allowed, whether the аllowance by the court is a judgment or not, or whether it draws interest or not. In case of insolvency, the claims to be paid pro rata are the сlaims allowed. (Rev. Stat. chap. 3, sec. 71). If dividends may be paid upon the claims after they are allowed, application of the proceeds realized from the sale of collaterals can be made upon them after their allowance.
In its account, the Bank makes certаin deductions from the proceeds of the sale of the collateral security for expenses incurred by it in protecting and disposing of the seсurity. We find nothing unreasonable in any of these deductions. Whatever reasonable expense is necessarily incurred by the pledgee in keeping and caring for the property pledged, and protecting it against liens and taxes and assessments, and asserting title to it, or rendering it available, is a fair charge against the property. (Hills v. Smith, 28 N. H. 369; Starrett v. Barber,
Whatever' defect there may have been in the execution of the agreement, authorized by the Probate Court to be made between the Bank and the administrators of the estate, is cured by the stipulation, entered into and signed by both parties, as tо the agreed state of facts upon which the case was tried in the court below. The stipulation admits the execution of the agreement by both рarties in the following words: “for the purposes of the hearing of this case, * * * the following facts are stipulated between the parties hereto: * * * thаt on the 15th day of January, 1890, * * * the said administrators and the said Union National Bank executed a certain agreement, a copy of which is hereto attached as Exhibit B.”
The judgment of the Appellete Court is affirmed.
Judgment affirmed*