Bleckley, Justice.
1. One trustee died; the other resigned; a single successor was appointed in the manner prescribed in the contract. It is objected that this was done without notice to the mortgagor and complainant. But the parties regulated the succession of the trust for themselves by their own voluntary stipulation. This stipulation does not provide for notice, but on the contrary requires nothing but nomination, ex parte, and confirmation. Both were had precisely as the contract points out. It is not uncommon for 1 he mode of supplying vacancies in the office of trustee to be defined by the trust instrument, and where it is dene, appointments are governed by the instrument, and not by the general law. The sections of the Code cited, to-wit: 2320, 2322 and 4223, have, for this reason, no application ■ to the present case.
2. There were two issues of bonds by the complainant, and both wore guaranteed by the Georgia Railroad & Banking Company. It seems the first guaranty took place without any statute authorizing it, and was afterwards attempted to be legalized by a clause in the act which empowered the corporation to make the second guaranty. It is urged that this retroactive clause is void because it is a distinct subject matter, or because the title of the act is not broad enough to cover it; and, thus, that the first guaranty must still be regarded as ultra vires, as it was in the beginning. But neither contract of guaranty has ever been repudiated or sought to be evaded. Both are recognized by the guarantor, and have been, in part, performed by the payment of interest coupons which the complainant had failed to protect. [120]*120In so far as these actual payments are concerned, on coupons covered by the mortgage, the complainant certainly cannot avoid the mortgage by denying that the first guaranty is, or ever has been, obligatory. Indemnity for assuming a supposed liability is not to be lost after the liability has been met as a real one and discharged. We rule nothing as to the validity of the first guaranty. The complainant is not in a situation to raise the question. Besides, coupons to a large amount have been paid which came within the second guaranty, and to these and the bonds to which they apportion, there is no suggestion of ultra vires. It is really for default as to these coupons, that the trustee is moving.
3. The point discussed by counsel for the complainant, as to whether the mortgage could be enforced in behalf of the holders of the bonds is premature. No very good reason occurs to us-why it might not be enforced at their instance, and for their benefit, if they held either bonds or coupons matured and unpaid. But this is not the case. They are not complaining of any default, nor are they in a condition to complain. As fast as the coupons have matured, the guarantor has reponded to the holders, and it is the guarantor who has had, or is attempting to have, resort to the indemnity. On its face, the mortgage has two objects, one of which is to secure the payment of the bonds, etc., and the other to indemnify the guarantor. The latter .of these objects is the one, and the only one, with which we are at present concerned.
4. The construction of the trust deed and mortgage contract in reference to the power of the trustees to enter and sell seems to us free from doubt. The instrument makes it the duty of the trustees to take possession on application, and then declares that they are also authorized, upon like application, to sell at their option. They may enter, and afterwards decline to sell; or they may both enter and sell, when the conditions as to default, application, notice, and persistence in default have all happened. The income arising between entry and sale, they are of course to use for [121]*121the purposes of the trust. To see that our construction is correct, it is only necessary to turn to the deed, and read it with tolerable attention.
5. No less clear is the provision which renders default as to coupons alone, a sufficient provocation for the ti nstees to move. Failure to pay the principal of the bonds is not a condition precedent to sale. The prompt payment of the coupons can no more be neglected than prompt payment of the face of the bonds. The language is free from ambiguity, and without quoting it, I merely refer again to the deed as copied in the report.
6. As to the evidence of demand for payment, and of notice of the intended sale, the chancellor hada sound basis for his decision in the bill, answers, and all the attending circumstances. Though discovery was waived in the bill, the waiver did not prevent the answers from being evidence, on this proceeding for an interlocutory injunction. It is true the answers were meagre enough (perhaps too meagre to withstand exceptions) as to the time, place and mode of demand and notice, but they were not excepted to for want of fullness, and they affirmed the main facts categorically, and this affirmation was responsive to charges in the bill.
7. The trustee, however, misconstrued the deed in planting his advertisement of sale upon the same identical sixty days during which his notice to the complainant of his intention to sell if default continued, had to run. The instrument contemplates two successive periods of sixty days, the first for the notice, and the next for the advertisement. A case for sale is not ripe until the first period has expired, and the trustee is not authorized to anticipate that the notice will prove ineffectual to induce payment. It is not improbable that a premature advertisement of sale would operate obstructively upon efforts of the debtor to raise money, and thus there would seem to be a substantial reason for withholding such a publication until the occasion for it had actually arisen. To demand payment to be made within sixty days, and at the same time to advertise a sale [122]*122as if the demand were already dishonored, is rather fast in any case, and is evidently too rapid under the terms of this deed.
8. Taking leave now of the instrument of trust and mortgage, we are next to construe the tripartite contract of November 12, 1872. The complainant contends that by that contract, the Georgia Railroad & Banking Company became the substitute of Hull & Co., to finish the complainant’s road, and to meet and discharge the in terterest upon bonds whilst the work of completion was in progress, just as Hull & Co. had obligated themselves to do by the contract of June 16th, 1869. We can see no warrant for such a construction, in the language of the writing. A stipulation so simple and direct would have been easy of expression, and if any purpose to express it had been entertained, the failure is so remarkable that nothing which we have heard or can conjecture serves to account for it. What, in the writing itself, the Georgia Railroad Company engaged to do, was to release certain demands, and to appropriate certain bonds held on special deposit “to the completion of the M. & A. Railroad according to the original contract and specifications made with G. G. Hull & Co., and all other work under said contract not by them fully performed.” Looking alone to the words, it is not clear that the Georgia Company was to do any work, or have it done. That company was to appropriate the bonds, or suffer them to be appropriated, to the work.
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Bleckley, Justice.
1. One trustee died; the other resigned; a single successor was appointed in the manner prescribed in the contract. It is objected that this was done without notice to the mortgagor and complainant. But the parties regulated the succession of the trust for themselves by their own voluntary stipulation. This stipulation does not provide for notice, but on the contrary requires nothing but nomination, ex parte, and confirmation. Both were had precisely as the contract points out. It is not uncommon for 1 he mode of supplying vacancies in the office of trustee to be defined by the trust instrument, and where it is dene, appointments are governed by the instrument, and not by the general law. The sections of the Code cited, to-wit: 2320, 2322 and 4223, have, for this reason, no application ■ to the present case.
2. There were two issues of bonds by the complainant, and both wore guaranteed by the Georgia Railroad & Banking Company. It seems the first guaranty took place without any statute authorizing it, and was afterwards attempted to be legalized by a clause in the act which empowered the corporation to make the second guaranty. It is urged that this retroactive clause is void because it is a distinct subject matter, or because the title of the act is not broad enough to cover it; and, thus, that the first guaranty must still be regarded as ultra vires, as it was in the beginning. But neither contract of guaranty has ever been repudiated or sought to be evaded. Both are recognized by the guarantor, and have been, in part, performed by the payment of interest coupons which the complainant had failed to protect. [120]*120In so far as these actual payments are concerned, on coupons covered by the mortgage, the complainant certainly cannot avoid the mortgage by denying that the first guaranty is, or ever has been, obligatory. Indemnity for assuming a supposed liability is not to be lost after the liability has been met as a real one and discharged. We rule nothing as to the validity of the first guaranty. The complainant is not in a situation to raise the question. Besides, coupons to a large amount have been paid which came within the second guaranty, and to these and the bonds to which they apportion, there is no suggestion of ultra vires. It is really for default as to these coupons, that the trustee is moving.
3. The point discussed by counsel for the complainant, as to whether the mortgage could be enforced in behalf of the holders of the bonds is premature. No very good reason occurs to us-why it might not be enforced at their instance, and for their benefit, if they held either bonds or coupons matured and unpaid. But this is not the case. They are not complaining of any default, nor are they in a condition to complain. As fast as the coupons have matured, the guarantor has reponded to the holders, and it is the guarantor who has had, or is attempting to have, resort to the indemnity. On its face, the mortgage has two objects, one of which is to secure the payment of the bonds, etc., and the other to indemnify the guarantor. The latter .of these objects is the one, and the only one, with which we are at present concerned.
4. The construction of the trust deed and mortgage contract in reference to the power of the trustees to enter and sell seems to us free from doubt. The instrument makes it the duty of the trustees to take possession on application, and then declares that they are also authorized, upon like application, to sell at their option. They may enter, and afterwards decline to sell; or they may both enter and sell, when the conditions as to default, application, notice, and persistence in default have all happened. The income arising between entry and sale, they are of course to use for [121]*121the purposes of the trust. To see that our construction is correct, it is only necessary to turn to the deed, and read it with tolerable attention.
5. No less clear is the provision which renders default as to coupons alone, a sufficient provocation for the ti nstees to move. Failure to pay the principal of the bonds is not a condition precedent to sale. The prompt payment of the coupons can no more be neglected than prompt payment of the face of the bonds. The language is free from ambiguity, and without quoting it, I merely refer again to the deed as copied in the report.
6. As to the evidence of demand for payment, and of notice of the intended sale, the chancellor hada sound basis for his decision in the bill, answers, and all the attending circumstances. Though discovery was waived in the bill, the waiver did not prevent the answers from being evidence, on this proceeding for an interlocutory injunction. It is true the answers were meagre enough (perhaps too meagre to withstand exceptions) as to the time, place and mode of demand and notice, but they were not excepted to for want of fullness, and they affirmed the main facts categorically, and this affirmation was responsive to charges in the bill.
7. The trustee, however, misconstrued the deed in planting his advertisement of sale upon the same identical sixty days during which his notice to the complainant of his intention to sell if default continued, had to run. The instrument contemplates two successive periods of sixty days, the first for the notice, and the next for the advertisement. A case for sale is not ripe until the first period has expired, and the trustee is not authorized to anticipate that the notice will prove ineffectual to induce payment. It is not improbable that a premature advertisement of sale would operate obstructively upon efforts of the debtor to raise money, and thus there would seem to be a substantial reason for withholding such a publication until the occasion for it had actually arisen. To demand payment to be made within sixty days, and at the same time to advertise a sale [122]*122as if the demand were already dishonored, is rather fast in any case, and is evidently too rapid under the terms of this deed.
8. Taking leave now of the instrument of trust and mortgage, we are next to construe the tripartite contract of November 12, 1872. The complainant contends that by that contract, the Georgia Railroad & Banking Company became the substitute of Hull & Co., to finish the complainant’s road, and to meet and discharge the in terterest upon bonds whilst the work of completion was in progress, just as Hull & Co. had obligated themselves to do by the contract of June 16th, 1869. We can see no warrant for such a construction, in the language of the writing. A stipulation so simple and direct would have been easy of expression, and if any purpose to express it had been entertained, the failure is so remarkable that nothing which we have heard or can conjecture serves to account for it. What, in the writing itself, the Georgia Railroad Company engaged to do, was to release certain demands, and to appropriate certain bonds held on special deposit “to the completion of the M. & A. Railroad according to the original contract and specifications made with G. G. Hull & Co., and all other work under said contract not by them fully performed.” Looking alone to the words, it is not clear that the Georgia Company was to do any work, or have it done. That company was to appropriate the bonds, or suffer them to be appropriated, to the work. The ratification of the contract by the directors shows, however, that the work was to be executed by the company, and in line with that construction was its subsequent action. But how much work was contemplated? Was it as much as might be required to finish everything included in the contract of Hull & Co., which that firm had left undone, or was it so much only as the bonds would pay for? We think it was the latter. The stipulation is to appropriate the bonds to the completion of the road according to the original contract and specifications made with Hull & Co., and all other work not by [123]*123them fully performed. The contract and specifications referred to were to be the guide, but not necessarily the measure of what the Georgia Company was to do. If the bonds were faithfully appropriated in advancing the road to completion and in executing the other unfinished work, and the fund was exhausted, leaving the road still incomplete or some of the other work unexecuted, we cannot see that the Georgia Company would be bound to proceed further. Having reached that stage, the company could truthfully say that it had performed its undertaking — that is, that it had appropriated the bonds to the completion of the road according to the contract and specifications with Hull *& Co., and to all other work not by Hull & Co. fully performed. To the objection that the road was still incomplete, and the other work unfinished, the company might well reply that the appropriation of the fund was not incomplete or unfinished, and that the fund being exhausted, operations' had, of necessity, to stop until further arrangements were made for carrying them forward. As to keeping down the accruing interest on the complainant’s bonds whilst the special deposit bonds were being thus appropriated, we can see no trace in the tripartite contract of any obligation upon the Georgia Company to do that. Surely the payment of interest, though it was embraced in the contract of Hull & Co., was not comprehended in “completion of the road” nor in “other work”; and if not, we cannot find that the tripartite contract makes any provision whatever for keeping down accruing interest. It mentions coupons paid by the Georgia Company, and releases them ; but no fair construction of the term “paid” would extend it to coupons which might thereafter be paid, or expand it into a promise to continue paying and releasing for the future. The record, it is true, contains an affidavit by the complainant’s president, the one who wras in office when the tripartite contract was made, which shows that his understanding of that contract was to the effect that the Georgia Company took the place of Hull & Co., both as to the [124]*124unfinished work and as to the duty of paying accruing-interest on the complainant’s outstanding bonds. But it is-not shown that the actual contract was different from that reduced to writing, or that the writing was different from-what the parties intended to make it. A statement is also-in the record, made by the then president of the Georgia Company to his board of directors, and entered on the minutes of the board, which exhibits his version of the contract, lie, it seems, considered his company bound to- finish the-road and other work, but not bound, at its own cost, to pay or keep down the interest. The statement adds that he-made a verbal agreement to meet the interest for the year 1813, in consideration of receiving the gross earnings of the road, and that the arrangement proved a loss. Thus, it will be observed, the two presidents differ widely ; and at' last we are thrown back upon what was before the highest and best evidence, to-wit: the written contract. There is-no reason to vary the construction of it on account of anything contained in the affidavit of the one president or the-statement of the other.
9. It is urged that accepting the above construction, the Georgia Company was bound to at least apply the special, deposit bonds to- the completion of the road and other work,, and to do it in a reasonable time; that such time has long ago elapsed, and that -the road is still unfinished, and the-fund but partially expended. Damage to the complainant from this delajr is insisted upon as a set-off to the redeemed coupons in the hands of the Georgia Company. This position gives rise to three questions of faet, the first, whether there has been unreasonable delay, the second, whether damage therefrom has resulted to the complainant, and the third, if so, whether the amount is sufficient to cancel the complainant’s default in the matter of failing to meet the coupons. As it does not appear that the Georgia Company is insolvent, the first two of these questions may be conceded as against it, and still there ought to be no injunction upon the proposed sale unless the amount of the damage, together [125]*125with the remnant of the bonds on deposit, would probably wipe out the default, so as to leave the condition of the mortgage unbroken, or the breach repaired. By contract, it is the absolute right of the Georgia Company to enforce the terms of the mortgage and to have the trust executed, if there is any balance whatever in its favor. The bonds and coupons rank as commercial paper, and on commeicial principles, strict promptitude in meeting them was, and is, indispensable. As we have ruled above, the obligation to meet the coupons was not shifted by the tripartite contract of November, 1872. After that contract, it was still the duty of the complainant to protect the Georgia Company against its liability as guarantor. Having broken this obligation, and thereby thrown the burden of providing for the coupons on the Georgia Company, the complainant is not in a favorable position for complaining effectively of any delay of the latter company in prosecuting the unfinished work of construction. We may very well suppose that the work would have proceeded more expeditiously if the complainant had kept down the interest on the guaranteed bonds. The heavy outlay for this purpose had to be borne-from time to time by the Georgia Company, when it should have been borne by the complainant. Had the Georgia Company diverted some of the deposit bonds from the work of construction altogether, and claimed them on the interest account, from the time of the first default, its conduct would not have been any wide departure from that which a creditor who has possession of a fund belonging ío his debtor ordinarily pursues. It is not usual for a person to persevere in the performance of a contract while the other party is engaged in breaking the same contract, or some other between the same parties, in a way to render the outlay of large sums of money necessary onee or twice every year. If the complainant has a proper claim for damages, it can be enforced by action. We do not see that any probable recovery, added to the deposit bonds unexpended, would balance the coupon account; and unless we could see that,. [126]*126we cannot say that the plain legal right to enforce the mortgage in the manner pointed out in the contract ought to be cut in upon by injunction.
10. The result is, that there was no merit in the bill except on the point of premature advertisement, and as that has disappeared by the lapse of time, there is now no obstacle to a sale after proper .advertisement. Full notice of intention to sell cannot be doubtful now, even if it was doubtful when the bill was filed. The contest over the right to sell has given the complainant unmistakable warning of the trustee’s purpose. Let the sale proceed after being duly advertised for sixty days.
Judgment affirmed.