Hence its sale, whether by the pledgee or by the sheriff under judgment of a court, may not bring a fair price. The general rule is that the pledgee is bound to collect, and, if necessary, sue upon, the collateral as and when it falls due, and apply it upon the debt secured. (Jones on Collateral Securities, sec. 651.) There is, therefore, ordinarily no reason why the pledgor should be compelled to suffer the loss consequent upon a sale of the collateral at a sacrifice. In our opinion, the most compelling reason why a court of equity will not decree the sale of such collateral, in the absence of special circumstances, is that, ordinarily, the pledgee or principal debtor has an adequate remedy at law. That is to say, the principal debtor may, and, indeed, is in duty bound, to collect the debt pledged as collateral as and when it falls due, and bring suit therefor if necessary. This right to collect the debt pledged as security affords, as a rule, a complete and adequate legal remedy; and for this reason there is no reason for the interposition of equity. (Whitteker v. Charleston Gas Co., 16 W. Va. 717, 722. See, also, Richardson v. Ashby, 132 Mo. 238, [33 S. W. 806]; Cleghorn v. Minnesota Title etc. Co., 57 Minn. 341, [47 Am. St. Rep. 615, 59 N. W. 320]; Donohoe v. Gamble, 38 Cal. 354, [99 Am. Dec. 399].) Special circumstances, such as will be held sufficient to take a case out of the general rule and justify the interposition of a court of equity to decree a judicial sale of notes or other evidence of indebtedness pledged as collateral security, exist where the pledgor is insolvent and the collateral note has many years to run after the maturity of the principal debt. (Cleghorn v. Minnesota Title etc. Co., supra), or where the principal debtor is a nonresident and has no property within the jurisdiction of the forum (Donohoe v. Gamble, supra). No circumstance of a special or peculiar nature, such as would justify a court of equity in ordering a judicial sale, has been pleaded or shown in this action.

[1] We think, therefore, that the correct interpretation of the rule, both under the common law and the code, is that where personal evidences of indebtedness are pledged as collateral security, no right is created in the pledgee, in the absence of express agreement, to personally cause a sale of the securities; and that he is only entitled to equitable relief and an order for judicial sale when there are special

conditions shown which were not in the contemplation of the parties when the contract was made, and which would impose additional hardships on the pledgee if he was required to rely upon the collection of the collateral debts at their maturity.

Sections 3000-3005 of the Civil Code provide that when the performance of an act for which a pledge is given is due, the pledgee may collect the same by a sale of the property pledged, "subject to the rules and exceptions thereinafter prescribed," and further direct the manner and conditions under which such sale shall be made. Section 3006 states what is excepted from the right to sell, as follows: "A pledgee cannot sell any evidence of debt pledged to him, except the obligations of governments, states, or corporations; but he may collect the same when due." This is conclusive of the whole matter unless section 3011 enlarges the pledgee's remedy with regard to this class of securities. It provides that "instead of selling property pledged, as hereinbefore provided, a pledgee may foreclose the right of redemption by a judicial sale, under the direction of a competent court."

There are two reasons within the terms of the statute itself why we think the section last cited does not apply to ordinary commercial paper. First, section 3006, in forbidding such sale by the pledgee, goes on to point out how he may realize on his security by the clause: "but he may collect the same when due"; and, second, section 3011, in authorizing equitable foreclosure and judicial sale of property pledged "as hereinbefore provided," limits its application to the character of pledges which are thereinbefore, by the sections above cited permitted to be sold. In other words, it provides an alternative method of selling pledges other than evidences of indebtedness. It may be conceded that this latter reference is not conclusive, as the section, so far as its wording is concerned, might be open to the construction contended for by appellant; but in our opinion there is no legal escape from the conclusion that the denial of right to sell such securities in section 3006, coupled with the provision; "but he may collect the same when due," was intended to provide an exclusive remedy, in the absence of some special claim to equitable relief such as might arise under any contract. Although there has been no direct

judicial construction of these code provisions in this state, as to this limitation of section 3011, the interpretation here presented seems to be suggested by practically every reference we have found to section 3006 in the California decisions. In McArthur v. Magee, 114 Cal. 126, [45 Pac. 1068], the court says: "It need only be pointed out that by section 3006 of the Civil Code a pledgee is forbidden to sell any evidence of debt pledged to him, but his right is limited to collecting the same when due"-and to the same effect in other decisions. (Gault v. Wiens, 32 Cal. App. 1, [161 Pac. 996]; Woolf v. Clark, 17 Cal. App. 696, [121 Pac. 407]; Frese v. Mutual Life Ins. Co., 11 Cal. App. 387, [105 Pac. 265]; Hunt v. Glassell, 30 Cal. App. 676, [159 Pac. 227]; Kelly v. Matlock, 85 Cal. 122, [24 Pac. 642].)

We find the same limitation recognized generally, whether under statutory provisions or the common-law rule governing pledges of this character. The commonly accepted rule is stated in Jones on Collateral Securities, section 651, as follows: "A pledgee of commercial paper as collateral security cannot, in the absence of special authority for that purpose, sell it upon the nonpayment of the debt upon notice to the pledgor, either at public or private sale, but he is bound to hold and collect the same when it falls due, and apply the money to the payment of the debt secured." (Wheeler v. Newborld, 16 N. Y. 396; White v. Phelps, 14 Minn. 27, [100 Am. Dec. 190]; Union Trust Co. v. Rigdon, 93 Ill. 458; Zimpleman v. Veeder, 98 Ill. 613; Stone v. Dickinson, 89 Mass. (7 Allen) 26; Miller v. Horton (Okl.), L. R. A. 1918C, 625, [170 Pac. 509]; Keeble v. Jones, 187 Ala. 207, [65 South. 384].) The only decisions cited, or which we have been able to find, that recognize the right of a pledgee to go into a court of equity to obtain an order of sale of this class of collateral security, including Donohoe v. Gamble, 38 Cal. 354, [99 Am. Dec. 399], were clearly influenced, at least, by the existence of special circumstances creating equitable claims of the pledgee not entering into the original pledge transaction. It is true that most of the decisions denying the right of sale of this class of securities. arise on attempted sales by the pledgee, but in nearly every instance this negation of the right of sale is coupled with the statement that the pledgee is "bound to look to the coltection of the collateral debt for his security," without mak

ing reference to any possible recourse to a court of equity. Yet the right to an equitable foreclosure and sale of all pledges that are subject to sale is universally recognized, and was formerly the sole method of procedure. In two cases that we have found, the right of resort to a court of equity for an order of sale of commercial paper is, however, presented and expressly denied. In Whitteker v. Charleston Gas Co., 16 W. Va. 717, 722, which was a proceeding in chancery to obtain an order of sale, it is held that where a chose in action is pledged as collateral security, the pledgee has no right to sell such pledge unless a power of sale is added to the agreement, "and a court of equity has no jurisdiction to sell such order on the application of the creditor." In Richardson v. Ashby, 132 Mo. 238, [33 S. W. 806], the supreme court of Missouri says: "The right of disposition by sale of the notes held as collateral is not one incident to the delivery and hypothecation of the same. Although there is some conflict in the courts of our country on the last proposition, we think the great weight of authority, as well as the reason of the rule, sustains the proposition that the holder of commercial paper as collateral for the payment of a debt, cannot, in the absence of special power for that purpose, sell the security so pledged upon default of payment of the debt, at public or private sale, with or without notice, as in the case of ordinary property on timely notice, nor by order of court can he dispose of the same. He is bound to hold and collect the security as it becomes due, and apply the proceeds to the payment of his debt." The opinion above cited, however, refers to the rule that equity may, under special circumstances, order a sale. The court on this point further says: "Some of the courts of our country, however, hold to the rule that where great inconvenience and loss are threatened by reason of the long delay in the maturity of the collateral, the court, on proper showing, may order the collateral sold and its proceeds immediately applied to the payment of the original indebtedness." If such a rule prevails, as it justly should, it is not a right inherent in any implied condition of the pledge contract, but arises from general principles of equity jurisdiction, and depends upon circumstances extraneous to the pledge contract.

[2] No such conditions are pleaded here, or appear from the record, other than the mere fact that the collateral note in question is payable in monthly installments of $50 each, and that it would take a period of twenty-eight months from the date this action was commenced to collect on the collateral the balance of one thousand four hundred dollars then due on the principal obligation. As this action was commenced September 4, 1915, and the findings show that the makers of the collateral note were entirely solvent, and one of them a director of the plaintiff bank, it is probable that the entire debt is paid off long before this. But in any event, the parties to the pledge contract entered into the agreement with full knowledge of the time and manner in which the collateral note was payable, and with presumptive knowledge of the law relating thereto; and there has nothing arisen subsequently to in any way jeopardize the value of the security.

We do not see that there is anything controlling in the point raised here, and referred to by the supreme court in Donohoe v. Gamble, 38 Cal. 354, [99 Am. Dec. 399], that commercial paper may, under the statutory law of California, be seized and sold under execution, or a sale may be ordered on foreclosure of chattel mortgage of the same. In the instances cited, the code of California permits the sale; in the matter of a pledge it forbids it. We are satisfied that plaintiff is not entitled to an order directing the sale of this collateral note.

[3] But there is another question which we think should have our consideration, and that is the fact that the learned trial judge denied appellant all relief-not only a judgment foreclosing the collateral security, but even a personal judg ment upon respondent's personal liability as maker of the principal note. We think that appellant was entitled to a personal judgment against respondent. There certainly can be no doubt but that a pledgee may bring an action at law and recover the amount of his debt from his debtor by an independent suit for a personal judgment, without selling or foreclosing the pledge. (Commercial Savings Bank v. Hornberger, 140 Cal. 16, [73 Pac. 625].) Is there any reason why he should not be entitled to the same relief where, as here, the pledgee has sought to procure a sale of the