192 WINDER v. DIFFENDERFFER.—2 BLAND.

From all that has been said upon this subject, I take it, that
interest upon interest, or compound interest may be charged in
three kind of cases; first, where with the knowledge and permis-
sion of the debtor his whole debt, principal and interest, has been
paid by a third person or his surety; because, as to such third per-
son or surety the interest is the same as the principal sum lent.
2 Font). 438. Second, where a trustee or holder of money has been
directed, or undertakes to invest the sum placed in his hands iu a
way to make it productive, and fails or refuses to do so, he shall
be charged with compound interest. As where a trustee was
ordered to invest a certain sum of money, then in his hands, in
bank-stock; and that he should, in like manner, invest the
dividends arising from such investment; on his failing and re-
fusing to do so he may be charged with interest upon the sums so
directed to be invested, and interest npon that interest until the
whole sum shall be invested or brought into Court, Sammes v.
Rickman, 2 Ves. Jun. 37; Ringgold v. Ringgold, 1 H. & G. 12:
Latimer v. Hanson, 1 Bland, 51. And third, where a trustee has
received rents and profits which he should have applied so as to
be productive, or towards the maintenance of devisees: but failing
or refusing to do so, retains and uses the money as his own, in a
manner to derive profit from it; there also he shall be charged with
the whole profits he has made from the use of it; or on his failing
clearly to shew what those profits were, it will be presumed, that
the annual amount of interest had yielded him interest; and he
must be charged with interest thereon accordingly; considering
each year's interest as an addition to the capital sum lent or with-
held. Co. Litt. 172, a.

The equity of the last rule is founded upon the fact of the benefi-
cial application of the money to the trustee's own use in violation
of his trust, and to the prejudice of the centui que trust ; and there-
fore, it must appear, that the nature of the trust required the
trustee to make the funds which came to his hands productive as
soon, and to as large an amount as practicable in the mode pre-
scribed, or iu * some other reasonable way, at his dis-
206 cretion; or that he was required to apply them to the main-
tenance or education of the cestui que trust; and it must also
appear, thas he not only failed to do so, but applied the money to
his own use. or put it to hazard in a manner in which he had, or
might have derived a profit from it. That the trustee was required
to invest, or make a beneficial application of the money may be
shewn by the terms in which the trust was created. But, whether
he has applied it to his own use or not, must be shewn by proof.
Whether the pecuniary ability of the trustee was such as to enable
him to pay at any time, when called on, is a matter of no conse-
quence, as regards the question of interest. The making of a de-
posit of the money at a bank as his own; or making purchases