Aldrich v Cooper
(1803) 8 Ves 38218031 min read
The case in brief30-second read
- Facts
- Senior creditor had security over two properties (Fund A and Fund B) Junior creditor had security over only Fund B. Senior creditor proposed to realise from Fund B (destroying junior's security)
- Issue
- Whether a creditor with two funds can be directed to satisfy from the fund that does not prejudice another creditor.
- Held
- Equity arranges securities so as to prejudice neither the senior (paid in full regardless) nor the junior (whose only fund is preserved). Senior directed to Fund A.
- Principle
- Marshalling: where senior creditor has two funds and junior creditor has one, senior must be directed to the fund junior cannot reach
Facts
- Senior creditor had security over two properties (Fund A and Fund B)
- Junior creditor had security over only Fund B
- Senior creditor proposed to realise from Fund B (destroying junior's security)
Issue
- Whether a creditor with two funds can be directed to satisfy from the fund that does not prejudice another creditor.
Held
- Equity arranges securities so as to prejudice neither the senior (paid in full regardless) nor the junior (whose only fund is preserved). Senior directed to Fund A.
Ratio decidendi
The senior creditor is indifferent (gets paid from either fund). The junior creditor will be destroyed if the senior takes their only fund. Equity intervenes: direct the senior to the fund the junior cannot reach. No prejudice to the senior; survival for the junior.
Exam use
How to use it in an answer
Foundational authority for S.81 (marshalling). Key line: "Where one creditor has two funds and another has one, equity directs the first to the fund the second cannot reach."
Cite this
Citation
Aldrich v Cooper (1803) 8 Ves 382Reported: (1803) 8 Ves 382. This is an educational summary, not the judgment itself. Cite the reported version in professional or academic work.