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BOMBAY: THACKEE, VINING & CO, MELBOUENB : GEOEGE EOBEETSON. 1878. LONDON : C. F. ECWOETH, PEINTEE, BEEAil's BUILDINGS, CHANOBET LANE. THE EIGHT HONORABLE SIR GEORGIE JESSEL, MASTER OF TSE ROLLS, THE . Bewsey 31 Alwyn, He 33, 140 Andrews, B,e 54 Antrobus v. Smith 21, 24 Arbnthnot v. Norton 30 Arnold v. Chapman 09 V. Garner 82 r. Woodhams 157 Ashby ». Blackwell Ill Att.-Gen. «>. Alford ..175,176, 177, 178 V. Dangars 174 ■ V. Downing 20 t'. Gore 139, 193 V.Owen 132 • «. Poulden 32 V. Routledge .... 56 V. Sands 30 I". -Scott 136 V. Stephens 20 V. Vigor 100 J).- Wilson 173 Austin V. -Taylor 4, 57, 58 Avelia v. -MeUiuish 157 AveUng v. Knipe 72 Avery i!.- Griffin 86 PAGE Ayerst v. Jenkins 67, 70 Ayhffi V. Murray 129 B. Backhouse ». Backhouse .... 20 Bagnall v. Carlton 78 Bagshaw v. Spencer 95 Bagspoole v. Collins 56 Ba&ey, Ee 167 «. Gould 105 Baker ». Monk 47 Baldwin v. Bannister 82 Balfour v. WeUand 198 BardsweU v. BardsweU 15 Barington, Re 165 Barker v. Greenwood 90 Re 148 V. Peile .... 149, 167, 170 Barling v. Bishop 48 Barlow V. Grant 133 Barrack v. McCullock 48 Barratt v. Wyatt Ill, 164 Barrett v. Hartley 129 Barrow v. Wad kin 43 Barrs v. Fewke 64 Barry, Ex parte 100 Bartlett v. Pickersgill 71 Bartley v. Bartley 137 Barton v. Briscoe 143 Bassett.j). Nosworthy ..193, 194 Bastard v. Proby 61 Bateley v. Windle 64 Bateman v. Davis 119 Bathorst, Re 151 Baud V. FarreU 123 Beale ;'. Simmons 103 Beattie v. Curzon 167 Beauclerc, Re 168 TABLE OF CASES CITED. PAOB Beaiimont v. Keeve 5 Beck V. Kantorowioz 78 Beokford v. Beokford .... 72, 76 v.Waie 160 Beekley v. Newland 28 Beddoes v. Pugh. 122 Bedford v. Coke 67 Begbie v. Crook 86 BeloMer, Ex parte. .112, 116, 117 Bell 1). Bamett 78 V. Gureton 17 Benbow v. Townsend 37 Bendyshe, Ke 133,168 Bennett, Ex parte 128 • . — «>. CoUey 187 W.Davis 20,101 V. Wyndam 112 Benson v. Benson 173 Bentham D. Haincourt .... 81 Berry v. Gibbons 137 Berwick (Mayor, &c.) v. Murray 176 Bethel v. Abraham 108, 137 Biddulph V. Williams 64 Bignold, Ee 149 BiUingsley v. Critchet 133 Billson V. Crofts 33, 140 Bindley v. Mulloney 35 Bingers v. Lambe 121 Bingham v. Clanmorris .... 86 Biuks V. LordRokeby 198 Birch V. Blagrave 67, 68, 72 V. Wade 13 Bird, Ee 112, 113, 115 • V. Eox 200 V. Maybury 16 Birks f . Micklethwaite .... 174 Biiizey i). Flight 21 Bladwell r. Edwards 30, 33 Blagrave v. Blagrave 92, 98 Blagrove v. Handoock 62 Blakeley Co., Ke 193 Bleazard v. WhaUey 133 Blencowe, Ex parte 173 Bloomfield t\ Hare 42 Blue V. Marshall 105 Bodmin (Lady) v. Vander- bendz 193 Bone V. Poland 72 Bostock «!. Floyer .. Ill, 113, 115 Bott V. Smith 48 Boursot V. Savage 193 PAGE BoTves V. E. L. W. Co. . . 131, 132 V. Strathmore 133 Bowles V. Stewart 157 Box, Ee 165 Boyle, Ee 127 Braokenbury D. Braokenbury 67, Brandon v. Robinson .... 30, 33, 140 Braybrooke v. Inskip .... 99, 100 Breed, Ee 134 Breedon v. Breedon 198 Brentwood Co., Re 81 Brewer v. Swirles 158 Bricej). Stokes.. .. 104, 112, 117, 118, 157 Bridge v. Brown 133 Bridgeman v. Gill 192 Briggs V. Penny 13 Bright V. North 131, 132 Brook V. Haynes 88 Brooker r. Pearson 33 Brown v. Brown 47 V. Casamajor 16 V. Be Tastet 130 V. GeUatly 121 V. Higgs 10 ■ V. Howe 139 ■ ». Litton 129, 130 V. Maunsell 163 i: Sibley 99 i\ Whiteway 95 Brumbridge p. Brumbridge 155 Brydges v. Brydges 57 Buchanan v. Hamilton .... 148 Buckeridge r. Glass 88, 157 Buckland v. Pocknell 81 Buckstou r. Buckston 104 Budge V. Gummow 108 Burdick v. Garrard .... 175, 177 Burden v. Biurdon 130 Burgess v. Wheate. .30, 102, 103 Bumaby v. GriJEn 59 Bumet v. Mann 42 Buron v. Husband 27 Burrell's case 55 Biirrough v. Philcox 10 Burrows v. Walls 125, 157 Burton v. Hastings 59 Biu-tt, Re 147 Bush V. AUen 92, 94 Butler D. Comptou 158 TABLE OF CASES CITED. XV PAOE Buttanslia-w v. Marten, . 139, 143, 144 Buxton «. Buxton 109 Byam v. Byam 137 C. Cadell V. Palmer 30, 31 Cafe V. Bent 151 Caffrey v. Daley 105 Calvin's case 43 Camoya (Lord) ». Best 151 CampteU v. Walker 107, 126, 129 Candler v. Tillett 117 Cardross, Re 84 Carew v. Cooper 30 Cargill V. Oxmantown . . ; . 120 Carriok v. Errington 69 Carter v. Carter 197 Cartwright «. Cartwright . . 30 Case V. James 194 Castle V. Castle 16 Cawthome, Re 167 Chadwiok v. Heatley 164, 165 Chambers ii. Chambers .... 59 V. Goldwin 129 ?;. Howell 128 V. Minohin 112, 117 ChaUen v. Sbippam 116 Chartered Bank of Australia V. Lempriere 158 Chedworth v. Edwards .... 182 Chertsey Market, Re 112 Chesterfield v. Jansen 157 Childers r. ChUders 67, 70 Chippendale, Ex parte .... 153 Christie v. Ovington 3 Clark V. Malpas 47 V. Swaile 126, 128 V. Wright 6 : V. Edmonston 163 ■ V. Eishwick 78 Clough «). Bond 112 ■!). Dixon 118 Coard v. Holdemesa 65 Cock V. GoodfeUow 108 Cockbum «;. Peile 125 CockeriU v. Cholmeley 157 Cocksedge v. Cocksedge .... 30 Coe, Re 167 PAQE Cogan V. Duffield 67 Cole V. Hawes 13 • V. Muddle 100 Colemore v. Tindal 92, 93 Coles V. Treoothick 126, 128 Collier v. MoBean 58, 197 V. Walters 93, 96 Collins V. CoUins 80 Columbine v. Penhall 48 Coningham v. Coniugham . . 88 Cook, Ex parte 183 Re 145 V. Addison 181, 182 • V. Crawford 147 V. Fountain 11 • V. EuUer 143, 144 • 1). Hutchins 64, 65 V. La Motte 44 Cooksou V. Reay 144 Cooper and Allen, Re. . 106, 107, 113, 114 Cooper ». Kynock 93 . Re 104 Coppring V. Cook 81 Cordwell v. Maokrill 196 Cormell v. Keith 20 Comthwaite v. Frith 18 Costello V. O'Rourke 121 Cotham 1!. West 131, 133 Cothay v. Sydenham 156 Cottington v. Fletcher 67 Cotton, Re 134 Coulson, Re 168 Coutts V. Ackworth 45 Coventry v. Coventry 149 Cowel V. G-atcombe 112 Cowman v. Harrison 15 Cox V. Page 10 Crabbe v. Crabbe 44, 45 Craven v. Brady 31 • V. Craddock 119 Crawley v. Crawley 32 Creswell v. DeweU 157 Crewe v. Dicken 136 Crockett v. Crockett 16 Croker v. Martin 54 Crouch V. Credit Eonoier . . 193 Cull, Re 168 Currant v. Jago 72, 76 Currie v. Nind 64 Curtis V. Perry 67 Cuthbertson v. Wood 165 TABLE or CASES CITED. PAOE Cuaack v. Cusack 68 Custance ». Cunninffhame , . 65 D. D'Adhemar v. Bertrand. . . . 150 Dakin v. "Whymper . , 55 Dalmaine v. Moseley 65 Dance v. Goldingham ..186, 188 Daniel, Ee 44, 69 Darville !>. Terry 51 Daubeney v. Cookburn .... 48 Davies v. Davies 44, 58 V. Hodgson. .85, 111, 164 V. Otty 67, 68 V. Westcombe 120 Davis V. Angel 187 ■ «•. Duke of Marl- borougb 29 Dawson v. Clark 64, 154 ■ t>. Prince 1 94 ■ V. Small 43 Dean v. McDoTvel 78 Dennis, Ee 165 Dent V. Bennett 44 De Visme, Ee 74 De Witte v. Palin 131, 133 Dimes v. Scott 184, 186 Dipple V. Corles 10, 21 Dix V. Burford 155 Dixon V. G-ayfere 81, 144 Dobson V. Land 82 Dooksey v. Dooksey 64 Dodds «. HiUs 197 Dodkin v. Brunt 150 Doe V. Biggs 90, 91 V. Bottom 90 V. Bottriell 54 t>. Da-ries 92, 98 V. Ewart 95 V. Harris 87, 88 V. Homfray 92 V. Hart 95 V. Manning 54 V. Moses 54 . . V. Nichols 92 V. Eusbam 55 V. Simpson 98 V. Webber 54 V. WiUan 95 Dolphin V. Aylward 54 PAOE Donaldson v. Donaldson . .23, 42 Doran v. "Wiltshire 138 Douglas V. Andrews 133 • ». Archbut 129 Dove V. Everard 89 Doyle V. Blake .... 87, 104, 112 Drayson v. Pooock 137 Drosier v. Brereton 108 Dubois, Ex parte 102 Dubosoq, Ex parte 26 Dumas, Ex parte 100, 101 Dunnage v. White 65 Dyer v. Dyer 71 Dyke v. EendaU 81 E. East Counties Eail. Co. v. Hawkes 108 Eastwood V. Kenyon 5 Eaves !;. Hickson ..111, 112, 192 Ebrand v. Dancer 71, 76 Ede v. Knowles 54 Edwards v. Fashion 72 ». Harben 50 V. Jones 26 ■ V. Merrick 128 Egbert V. Butter 118, 190 Egmont (Earl) -e. Smith 80, 110, 129 Eland v. Eland 198 Elcock V. Mapp 64 EUiot, Ee 167, 170 V. Merryman 197, 198 EUis, Ee 139 EUison, Ee 86 V. Ellison 20 Emmett v. Clarke 151 Ernest v. Croysdill 182 Evans v. Carringtou 47 V. Edmonds 47 ■ V. Jackson 132 V. John 89 Everett v. Prythergch .... 188 Everitt v. Everitt 45 Evroy v, Nicholas 85 Eyre v. Dolphin 78 V. Shaftesbury (Coun- tess) 145 Eyston, Ex parte 140 TABLE OP CASES CITED. F. PAQE Fanshaw v. Welsby 44, 46 Farhall v. Farhall 102 Farmer v. Dean 126, 129 Farrant v. Blanchford .... 138 Fawcett «. Wliitehouse .... 78 Featherstone v. West 174 Featherstonliaugh v. Fen- wick 78 Feistel v. St. John's Coll. . . 30 Fellows V. Mitcliell 117 Fenwick v. Clark 116 Ferris v. Mullins 81 Field v. Donouglmiore .... 18 Finney, Re 99 Fish V. Klien 85 Fisk». Att.-G-en 43 Flanagan ». G. W. E. Co. . . 78 Fletcher -v. Fletcher 186 ■ V. Green 158, 174, 186 Floyer v. Banks 30, 33 Foley ». Barry 13 V. Eurnell 186, 187 V. Wortner 145 Foligno, Ee 167, 170 Forbes v. Peacock 198 Forest V. Forest 72 Forshaw v. Higginson. . 105, 149 167 Fortescue v. Burnett 26 Foster V. Dauber 87 «. Hale 37 . and Lister, Re .... 5 Fowler v. Fowler 43 Fox V. Buckley 190, 191 . V. Fox 15 ». Maokreth 126 Francis ». Francis 127 Freeman v. Pope 48, 51 French ■». Hobson 157 Frith V. Cartland 100, 182 Fryer, Re 112, 117 Fuller V. Kniglit 190, 191 GafEee, Re 139, 143 Gale ». Gale 7 tr.T. PAGE Garland, Ex parte 102 Gamer ». Moore 137 Garrard «). Lauderdale .... 17 Garrett v. Wilkinson 74 Gascoigne v. Thwing 64 Gaskell ». Chambers 79 General Estates Co. , Re ... . 193 George, Re t3i V. Howard 66 V. Milbank 48 Gibbs V. Glamis 67 V. Rumsey 64, 69 Gibson V. Lord Montford . . 95 V. Jeyes 128 Gilbert v. Overton 22, 27, 42 Gisbome ti. Gisbome 133 Gladden v. Stonemau 188 Glenorchy v. BosvUle 4 Glover v. Monckton 98 Godolphin ». Godolphia .... 86 Goodson V. EUisou 167 Gough v. Butt 12 Gould V. Robertson 18 Grange v. Tiving 85 Grant v. Grant 24 Graves v. Dolphin 30, 33 Gray, Ex parte 102 Graybourne v. Clarkson .... 109 Great Luxembourg Rail. Co. V. Magnay 78 Greaves v. Simpson 58 Green, Ex parte ..102, 131, 133 r. Carlill 20 V. Spencer 33 V. Spicer 140 Greenwood v. Wakeford. . . . 149 Greetham v. Cotton 200 Gregg V. Coates 11 Gregory v. Gregory 112 ■ V. Henderson 91 GrenfeU c. Dean, &c., of Windsor 28 Gresley v. Mousley 102 Grey ■». Grey 75 Grieveson ». Kirsopp 10 Griffin, Ex parte 117 Griffith ». Buckle 58 f. Porter 111,164 ■ V. Ricketta 18 «>. Vere 30, 32 Gunnell a. Whitear 169 h XVIU TABLE OF CASES CITED. H. PAGE H , Ee 187 H V. W 30 Haigh V. Kaye 67 Hale V. Cox 56 V. Lambe 5 V. Saloon Omnibus Co. 51 Haley v. Bannister 32 Hall V. HaU 45 V. May 147 Hanbnry v. Kirkland 118 Harcourt v. Seymonr 144 Harden v. Parsons 117 Harding v. Glyn 11 Hardwicke «>. Mynd 112 Hardy v. Reeves 196 Harman v. Richards 48, 51 Harris v. Harris 108 HaiTison, Ee 149, 152 V. Forth 193 Hart V. Middlehurst 59 Harton v. Harton ... .91, 92, 95 Harwood v. Tooke 28 Hastie v. Hastie 20 Hawkins v. Gardiner 37 V. Luscombe .... 95 Haycock, Ee 166 Hayes v. Kingdome 65 Headington, Ee 168 Hemings, Ee 167 HenricLuez v. Bensusan .... 17 Hep-worth ». Hepworth .... 74 Herdson v. "Williamson , . 95, 98 Hibbert v. Hibbert 19 Hickley ■». Hickley 126 Higginbottom v. Holme .... 33 Highway v. Banner 59 Hill V. Bishop of London . . 63 Hindmarsh v. Southgate . . 85 Hinton v. Hinton 101 Hitchens v. Congreve 78 Hoare v. Osborne 4-1 Hobson «. BeU 107 Hodge ». Att. -Gen 86 Hodgson, Ex parte 33 Hoghton V. Hoghton 44 HoUand v. Holland 173 HoUoway v. EadcHile 144 Holmes v,. Dring 124 ff. Penny 48 Hood V. Oglander 33, 140 Hooper, Ee 165 PAdB Hopgood V. Parkin 113 Hopper V. Conyers 182 Hora V. Hora 16 Horlock V. Horloek 139 Horn 1). Barton 59 «j. Horn 198 Hoskins, Ee 167 Hotham, Ee 165 Houghton V. Coenen 100 Houston V. Hughes 91 Hovey «. Blakeman 118 Howarth, Ee 131, 133 Howe V. E. Dartmouth 121, 124 Howel p. Howel 59 Hughes, Ex parte 127 V. Empson 109 V. Hughes 21 ■ V. Kearney 80 r. Williams 81 ». Wills 157 Huguenin v. Baseley . . . .44, 46 Humberton v. Humberton 57, 62 Hume V. Eichardson 125 Hunt t>. Bateman 161 ■ «', Foulston 144 Hunter v. Bullock 43 Hutchins ». Lee 66 Hutchinson and Tenant, Ee 16 Huxtable, Ex parte 53 Hylton V. Hylton 44 I. Ingle t'. Partridge 107 Ingram, Ee 125 Inwood V. Twyne 131 Irby, Ee 168 Irvine v. Sullivan 64 Isaacson r. Harwood 173 ItheU V. Beane 7, 198 J. Jackson v. Welsh 78 Jacob, Ee 165 Jacobs V. Lucas 145 Jacubs v. Eylance 190 James, Ex parte 126, 153 V. Dean 78 TABLE OF CASES CITED. XIX PAGE James v. Frearson 87, 88 Jarratt ». Aldon 46 JefEries ii. Jeffries 5, 21 Jenki n s r. Kemish 5, 54 V. Vaughan 48 Jervoise v. Duke of North- tunberland . . 57, 58 ■ V. Silk ..; 133 Jodrell V. Jodrell 35 Johns «', James 17 Johnson v. Fesenmayre .... 128 V. Kennett 198 f . Legard 5, 6 ■ ■ V. Newton 116 ■ r. Rowlands .... 13 Jones V. Foxall 175, 176 ■ V. aoodchild 103 V. Higgins 158 V. Langton 58 V. Lewis 109 ■ r. Locke 23 r. Morgan 58 V. Powell 137 V. Thomas 193 Josselyn ». Josselyu 142 Joy «). CampbeU ..112,117,118 Joyce V. De Moleyns 196 K. Kaye r. Powell 139 Kekewich v. Manning .... 22, '42 Kellauey r. Johnson 158 Kendal v. Granger 65 Kenriok ». Lord Beauclerc . . 91 Kevan v. Crauford 48 Kidney v. Coussmaker .... 48 KUbees. Sneyd 112 Kilpin r. Kilpin 39 Kil worth, v. Mountcashel . . 190 Kimber v. Barber 79 King V. Bellord 84 V. Denison 63, 66 V.King 168 Kingdom p. Castleman 106 Kingham «. Lee 11 Kirwan v. Daniel 18 Knight, Ee 104, 167, 170 ». Brown 33 V. Knight 10, 11 V. Plymouth (Earl) . . 117 PAQE Knowles, Ee 165 Knox V. Gye 129 Kronheim v. Johnson 37 L. Laeey, Ex parte 126 Lake v. Gibson 72 Lamb f . Eames 16 Lambert f . Peyton 58 Lane, Ee 168 r. Debeniam .... 145, 146 P. Dighton 182 Langford r. Angel 99 V. Gascoigne. .112, 117 Langham v. Sandford .... 64 Langmead, Ee 198 Lavender v. Blackstone .... 54 V. Stanton 198 Law V. Law 67 Lawson v. Copeland. . . . 105, 167 Leiich V. Leach 71, 157, 182 Leake, Ee 167 Lee V. Brown 131, 134 r. Lee 19 V. Sankey 117 Leedham ». Chawner . . 120, 153, 164 Lees V. Sanderson 118 Le Hunt r. Webster 110 Leslie, Ee 133 V. Bailey 156 Le Touche v. Lucan (Earl). . 18 Lewis V. Maddocks 19, 20 Life Association of Scotland V. Siddal 157 Lingard v. Bromley 174 Linquate v. Ledger 47 Linyee, Ee 143 Lister v. Hodgson 46 Little V. Neil 12 Lockhart v. EeiUy .... 108, 174 Locking v. Parker 161 Longdon v. Simpson 32 Lonsdale (Lord) v. Beckett 161 Lord V. Brnrn 137 Lorentz, Ee 165 Loughly V. Loughly 65 Low 1!. Peers 30 Lowry v. Fulton 89 Loyd V. Baldwin 198 52 TABLE OF CASES CITED. PAGE Loyd r. Loyd. .30, 31, 35, 43, 65, 101 Lupton «•. White 181 Lush, Re 157 V. Villrinson 48 Lyddon v. Ellison 62 Lynn v. Beaver 64 Lysaght v. Edwards 99 Lyse V. Kingdome 173 Lyster r. Burroughs 19 M. Maberley r. Turton 131, 133 Maokreth «'. Syuraions ..80, 193, 194 Maenamara r. Carey 106 V. Jones 164 MoCormick i). G-rogau .. 37, 40, 82 McCuUock r. McCullock .... 13 McDonnell v. "White 160 McEadden v. Jenkins 37, 40 McGahan v. Dew 190 McKinnon v. Stewart IS McLean, Ee 169 Mequeen v. Earqiiliar 193 Maddocks r. "Wren 81 Magor i\ Lansley 20 Maguire ». Scully 59 Mahon v. Stanhope 120 Malcolm v. O'Callaghan . . 154 Mangles v. Dixon 193 Mansell v. Mansell 194 Mansfield v. Shaw 188 Marker v. Marker 157 Marlow v. Tomas 23 Marples ^. Cambridge .... 31 Marseilles Imp. Land Co. , Re 126 Marsh ». Att.-Gen 165 Ex parte 100 Marshall ». Holloway 31 ■ V. Sladdon 120 Marten v. Laverton 99 Martens ». JollifEe 193 Massey r. Banner 104 Mathison v. Clark 82 Matthews v. Brise 116 . !). Elaver 47 May V. Taylor' 101 PAGE Meiuertzhagan «'. Da-sds 181 Mennard v. "Welford 152 Meredith v. Heneage 13 Merryweather r. Jones .... 30 Metoalf i: Pulvei-toft 56 MetoaUe, Ee 169 Metham v. Duke of Devon . . 34 MicheU, Ee 19 MicheUs v. Corbett 132 Middleton V. Dodswell 186 V. Pollock .... 37, 184 V. Spicer 103 Mill V. Hill '8 Millar r. Priddon 151 Millard v. Eyre 148 MOIer V. Eace 101 Milligan v. Mitchell 188 MOner v. Harwood 46 Miboyj;. Lord 20, 21 Minors r. Battison 137 Mitoheson t\ Piper 137 Mockett, Ee 165 Moggridge r. ThaokweU . . 20 Montefiore v. Brown 18 V. GuedaUa 125 Montford r. Cadogan ..88, 157, 163 Moore v. Croften 5 V. Proud 129 Moravia Society, Ee 152 More V. Mahon 193 Morgan, Ex parte 99 V. Elford 192 r. Malleson 24 Morice v. Bishop of Durham 65 Morley, Ee 99 r. Morley 109 r. Eeynoldson 30 Morrett v. Baske 79 Morrison r. Morrison 153 Morse r. Eoyal 126 Mortuner v. Ireland 146 Mortlock r. Buller 120 Moseley, Ee 168 Moss, Ex parte 81 Motz V. Morreau 46 Mucklow V. Puller 88, loo Muggeridge, Ee 165 Mulin V. Blagrave 110 Mundel, Ee 1,50 Murch r. Eussel 157 Mutlow r. Bia-g 160 TABLE OF CASES CITED. XXI N. PAGE Nail «'. Punter 157 Nandick r. Wilkes 59 Nanney v. Williams 47 Nash V. Allen 91 V. Preston 101 Naylor v. Arnitt 132 Neale v. Davis 122, 123 Needliam, Ee 89 Neligan i). Eoclie 123 Nelson v. Bridport 26 New V. Jones 129 Newsome v. Mowers . . 121, 122 Newstead v. Searles 7 Newton v. Newton 196 Nicholson v. Tuttin 18 Noai'd V. Backhouse 187 Noble «!. Wilcock 42 Noel V. Jeavon 101 Norcutt v. Dodd 48 Norfolk (Duke's) case 30 Norris, Ex parte 173 V. Wright 108 North V. Crampton 64 Norton v. Pritchard 110 O. Occleston v. Fullalove 33, 34 Ogle, Ex parte 175, 180 Oldham v. Oldliam 140 OUver V. Court 107, 112 Onslow i>. WalHs 103 Ord r. Nowel 107 . V. White 193 Orrett v. Corser 106 O'Eorke v. BoHngbroke .... 47 Osgood v. Strode 5 Osmond v. Eitzroy 44 Owen V. Delamere 102 Packman and Moss, Ee .... 99 Paddon «. Eichardson ..87, 109 Paliaret v. Carew 110, 148 Palmer v. Simmons 15 v. Xoung 78 PapUlon V. Voice 61 Parker v. Brook 20, 196 PAGE Parker v. Calcraft 81 V. Carter 55 Parrett v. Sweetland 81 Patterson v. Murphy 26 Paul V. Compton 13 Pawlett V. Att.-Gen 30, 86 ■ V. Hood 165 Peard v. Kekewioh 62 Pearse v. Green 125 Pearson, Ee 33, 48, 51 ■ ».AmicableAss.Co. 26 V. James 57 Pease, Ex parte 100 Pechel V. Fowler 107, 188 Pennell v. DefeeH 181 Perry, Ee 88 Petrer. Petre 160 Peyton, Ee 165 Philhps V. Mulhngs 44 r. Phillips 193 Pickering v. Stamford 163 Pierce v. Scott 200 Piercy, Ex parte 18 V. Eoberts 33 PUcher v. Eawhns .... 193, 195 Pitt«>. Pelham 11, 20 Platamore v. Staple 67 Poad V. Watson 93, 96 Pocock r. Beddington 108 Pole V. Pole 74, 78 Pooley V. QuHter 127 Potts r. Britton 108 Powell V. Price 59 Pratt V. Sladden 04 Prevost p. Clarke 13 Price V. Blakemore 183 V. Jenkins 54, 56 Prime v. Savell 163 Pritchard v. Ames 20 Proctor v. Eobiuson 35 Prodgers v. Langham 53 Pryce f. Bury 81 Pybusr. Smith 139 Pye, Ex parte 21 E. Eaby r. Eidehalgh .... 121, 163 EandaE v. Errington 120 Eeade v. Okes 107 Eeddington v. Eeddington . . 74 TABLE OF CASES CITED. PAGE Eeece River Co. v. Atwell 48, 50 Reeves f. Baker 13 Reg. V. D^y 102 ■ .1). Stapleton 102 ' .«;. Sterry 102 Rehden », Wesley 116 Rey^ell v. Spry 67 Richards, Re 168 : ■ V. Pelbridg-e 21, 25 Richardson v. Jenkins 173 V. Richardson . . 2i V. Small wood . . 48 Rickards v. Rohson 43 Ridder v. Ridder 48, 71 Rigden v. Vallier 72 Rigley, Re 44 Riaghaui v. Lee 82 Ritson V. Stordy 43 Roberts, Re 168 Robinson, Re 159 r. Lowater 198 ■ K. Rett 86,129 V. Preston 72 V. Robinson 109 Robson V. Flight 136 Rodbard V. Cooke 118 Rogers v. Rogers 66 Rolfe V. Rudder 20 V. Gregoiy 192 Roper Curzon v. Roper Ciu-- zon 134 Rowbottom T. Dunnett .... 69 Rowland v. Morgan 167 Rowley r. Adams 105 Royds V. Royds 108 RudkiTi V. Dolman 37, 65 Rushworth's case 78 Russell V. Russell 81 Ryal V. Ryal 71, 101 Ryder r. Bickerstou 108 S, Sabin v. Heape 200 SackvilleWestr.Holmesdale 4, 57, 59 Salisbury v. Denton 12 Salloway v. Strawbridge . . 147 Salter v. Cavanagh 160 Sandford v. Keeoh 77, 127 Sarley v. Cloclnnakers' Co. 20 PAGE Saunders v. Dehew 54, 197 Saunderson, Re 33 Sayres v. Hughes '■' Scaife v. Soulsby 48 Scales V. Baker 182 Scott «'. Beecher 187 V. Surman 100 Sculthorpe v. Burgess 65, 66 ». Tipper 109 Seagram «>. Knight. .131, 132, 134 Seagrave i>. Seagrave 47 SeUack v. Harris 40 Shafto V. Adams 27 Shapland v. Smith 90 Sharp V. Roy 167, 160 Sharpe ». St. Saveur 43 Sharpies i). Adams 197 Shaw, Re 165 V. Lawless 19 V. Rhodes 32 ». Weigh 95 Shepherd, Re 187 Sherwood, Re 129 Shewin v. Vanderhorst .... 137 Sidmouth «>. Sidmouth 44, 74 Sigger V. Evans 18 Simpson, Re 165 Sisson ». Shaw 131, 133 Skingley, Re 11 Smallwood v. Rutter 167 Smith (). Cheiril 5, 6 v. Matthews 38 r. Smith 86 V. Ward 26 v. Wheeler 139 Snowdon v. Dales 30, 33, 140 Soar ('. Foster 72 Sowarsby v. Laoey 198 Spencer v. Topham 128 SpiUer, Re 165 Spink r. Lewis 65 Spirrett v. Willows 48, 50 Sporle ». Burnaby Ill Spring r. Pride 126 Springett v. Dashwood .... 125 r. Jennings 69 Spurgeon r. Collier 194 St. John V. St. John 67 Stacey v. Elph 86, 89, 128 Staclshouse r. Burnstou .... 158 Staclrpoole v. Stackpoole .... 5 Stafford v. Fiddon 175, 176 TABLE OF CASES CITED, PAGE Stafford p. StafEord 157 Stamford (Earl) v. Hobart. . 57 Standon v. Bullock 54 Stanley v. Lennard 4 ■ V. Stanley. . 142, 157, 159, 190 Stead V. MeUor 13, 15 Stickney !■. SeweU 108, 127 Stikeman v. Dawson 85 Stock v. McAvoy 26, 74 ■ I). Moyse 19 Stockeu V. Dawes 130 Stokes, Re 149, 167 Stokoe V. Cowan 48 Stone V. Lidderdale 30 Stoner v. Kirwan 58 Stones V. Rowton 151 Strange v. Fooks 157 Streatfield v. Streatfield .... 58 Stretton v. Ashmore 108 Strickland v. Aldridge 37, 40 Strong V. Strong 40 Stuart V. Norton 135 t: Stuart 121 Stubbs V. Sargou 64, 65 Styles V. Guy 118, 124 Sutton V. Jones 127 V. Wilder Ill Swan, Re 133, 168 Sweetapple v. Bindon 59 Swinnook v. De Crispe. .131, 133 Sykes v. Sykes 30,33 Symes ». Hughes .... 67, 68, 71 Synnot v. Simpson IS T. Talbot V. Earl Radnor. .110, 167, 170 ■ r. Scott 186 Tappenden v. "Walsh 20 Tarleton v. Hornby 174 Tarrant ». BlancMord . .158, 162 Tatam v. "WiUiams 163 Taylor v. Cartwright 168 . V. Chester 67 1!. Coeuen 48, 62 p. Hagarth 103 . V. Meades 45 . . V. Pluiner . . 100, 182, 183 PAGE Tebbs r. Carpenter 105 Teesdale v. Braithwaite .... 5 Tempest v. Camoys 20 Tennant r. Treuchard .... 126 Thompson ». Eastwood 160 • i'. Einch 118 • V. Shakespeare . . 43 r. Simpson 196 V. Webster 48 Thornboroilgh v. Baker .... 81 Tibbets r. Tibbets 13 Ticker v. Smith 105 Tidd V. Lister 139 Tiemey r. Wood 37 Titley v. Wolstenhohne 147 ToUer V. Atwood 95 Tooke V. HoUingworth .... 100 Topham v. Spencer 79 Townend v. Toker 66 ■ u. Townend 176 Townsend v. Barber 118 V. Westacott .... 48 Townley v. Sherborne .... 117 Townson v. Tickell 86 Trafford v. Boehm 163 Travel (Ladies) case 42 Tregonwell v. Sydenham 65, 66, 69 Trench v. Harrison 182 Trevor v. Trevor 58 Tucker v. Buron 72, 77 V. Horneman 167 TuHett ». Armstrong . .139, 143 Tunbridge v. Cane 72 Turner v. Collins 46 ». Corney 112 4'. Maule 152 Turpin, Ex parte 190 Turton r. Benson 193 Tweddle v. Atkinson 5 Tweedale v. Tweedale 10, 12 Twynne's case 49 U. Underwood ». Stevens .... 157 Ungless ». Tuff 125 TJniacke, Re 89 TJpfull, Ra 168 XXIV TABLE OF CASES CITED. V. PAOE Vanderberg i\ PaJmer 26 Vansittart v. Vansittart 35 Vaughan ». Tanderstegen . . 158 Vaughton v. Noble 190 Venables v. Eoyle 81 t>. Morris 92 Vernon v. Vaudrey 173 ViUiers v. Villiers 95 Vyse V. Foster .... 127, 133, 175, 179, 184 W. Waite v. Littlewood 125 Waldo r. Waldo . . 131, 132, 134 Walker v. SmaUwood 137 . V. Symonds 117, 118, 157 V. WethereU 134 Walstam v. Staiatou 163 Walters v. Woodbridge 153 Walton V. Walton 63, 64 Walwyn v. Coutts 17 Want t: StaUibrass 120 Warbuiton v. Sandys 145 Ward r. Butler 88 V. Ward 105, 131 Ware v. Cann 33 Warriner ». Rogers 25 Warwick t\ Warwick 196 Watldns r. Cheek 200 Watson r. Hayes 64, 66 ». Pearson 92, 95 Watts, Ee 152 V. G-irdlestone 120 Webb «. Lngan 78 V. Shaftesbury (Earl) 126, 127, 129, 188 V. Wools 13 Wedderbum i'. Wedderbum 130 Wellesley v. WeUesley .... 19 Wells V. Malbon 167, 171 Wesley t). Clark 117 Westmeath ». Westmeath . . 34 Westmoreland v. Tunnicliffe 173 Wetherby ». St. Giorgio . . 198 Wethered v. Wethered .... 27 Wheeler v. Smith 71 V. Warner 10 White r. Briggs 11 V. Parker 90 Whitefield v. Brand 100 PAGE Wichoote V. Lawi'enoe .... 126 Wightman v. Townroe .... 102 Wigg V. Wigg 11 Wiles V. Gre8ham..l05, 184, 185 Wilkins V. Hogg 155 Wilkinson v. Parry 148, 157 Wilhams, lie 167 ».AUen 190 ■ V. Corbet 19 V. Teale 62 V. Waters 91 ■ V.Williams ....72,73 WiUis V. Kibble 129 ■ v. Kymer 62 Wills V. Wms 64 Wilson V. Hoare 102 V. Moore 173 Winch r. Brutton 15 v. Keeley 100 Winslow V. Tighe 78 Wise r. Wise 89 Withers v. Withers 37 Withington u. Withington 152 WoUaston ». Tribe 5, 6, 45 Woods. Cox 13, 64 V. Hardisty 173 ■ r. Pattesou 131, 132 ». Weightman 112 Woodbum, Ee 167, 170 Woodhouse v. Woodhoiise. . 106 Woods V. Woods 16 Woodyatt v. Gresley 190 Worral v. Harford 18, 153 Worthington t\ M'Crear . . 134 Wright, Ee 164 V. Cadogan (Earl) . . 42 ■ ■ V. Pearson 57, 58 ■ V. Snowe 85 1'. WiHrin 10, 11 V. Wright 81, 143 V. Vanderplank 46 Wray «. Steele 71 Wren v. Kuton 117 Wyatt V. Sharratt 108 Wykham v. Wykham 92 Wylley, Ee 168 r. Tew V. Edwards 78 York, &c., Co. V. Hudson . . 79 Younghusbandi'. Gisbome 33, 141 A OF THE LAW EELATDfa TO PRIVATE TRUSTS. Art. 1. — Definitions. In this mamial, the following terms are used with the meanings assigned to them in the subsequent para- graphs, namely: — A trust means an obligation under which some person is bound, or has bound himself, to deal with the beneficial interest in real or personal property which is vested in him, in a particular manner and for a particular purpose, either wholly in favour of another or others, or partially in favour of another or others conjointly with himself {a). (a) I can cite no auttority for are,generallyspealnng,notmerely tHs definition. Mr. Lewin adopts collateral. The expression "some Lord Coke's definition of a use, other," is also apt to mislead, namely, "A confidence reposed and to convey the impression in some other, not issuing out of that the trustee must be some the land, hut as a thing col- other than either the settlor or lateral, annexed in privity to the the cestui que trust, whereas, as estate of the land, for which will be seen further on, such an cestui que trust has no remedy impression would be incorrect, but by subpoena in chancery." Then, so far as the remedy is Co. Lit. 272 b. This definition concerned, the definition is obso- would seem to be applicable to lete. The Court of Chancery no real estate only, and certainly longer exists, and all branches of not to trusts of choses in action, the High Court take cognizance the equities attaching to which of equitable rights, although the U.T. B 2 PEIVATE TEirSTS AOT5 TKUSTEES. The settlor means the person wlio, either actually or by construction of law, creates the trust. The trustee means the person upon whom the obliga- tion rests, either by declaration of the settlor or by construction of law. The cestui que trust means the person in whose favour the trustee is to deal with the beneficial iaterest in the trust property. The trust property means the real or personal property which is the subject of the trust. Legal estate means the estate or interest of any person which was originally the only estate or iaterest recognized by the courts of law, and which is even now, as between the owner of it and third parties, the estate prima facie recognized by the courts, and is held by virtue of the provisions of the general law, and not by virtue of any doctriue of judicial equity. EcLuitable estate means the beneficial iaterest unac- companied by the legal estate, which interest was ' originally recognized by courts of equity only, and enforced by attachment of the person of the owner of the legal estate, and which although now re- cognized by all courts, depends for its validity upon the doctrines of judicial equity, and not upon compliance with the provisions of the general law (5). Chancery Division is the proper (4) The above definitions of branch in which to enforce ex- legal and equitable estate are press trusts. Mr. Speuce's defi- probably open to criticism, but nition, Tvhich is adopted by Mr. now that courts of law and Snell and Mr. Josiah Smith, is, equity are united into one TTio-b with great respect for those three Court of Justice, it is no easy eminent writers, a definition of task to define the meaning of the the estate or interest of a cestui terms legal and equitable inas- que trust, and not a definition of much as the law is now extended a trust at all. Their definition is, by the addition of what was f or- that ' ' a trust is a beneficial inte- merly known as judicial equity, rest in, or a beneficial ownership Still, as was said by Lord Sel- of , real or personal property,unat- borne, ' ' If trusts are to contiaue, tendedwith the possessory or legal there must be a distinction be- ownership thereof." 2 Sp. 875. tween what we call a legal and DEFINITIONS. 3 In relation to the duties of the trustee, trusts are divisible iato two classes. a. A bare or simple trust means a trust reposed in a trustee to whose office no duties were originally attached, or who, although such duties were origi- nally attached to his office, would, on the requisition of his cestuis que trust, be compellable in equity to convey the estate to them or by their direction (c). ^. A special trust means a trust in which the machinery of a trustee id) is introduced for the execution of some purpose particularly pointed out by the settlor, and the trustee is not, as in the case of a simple trust, a mere passive depository of the estate, but is called upon to exert himself actively in the execution of the settlor's intention (e). A bare trustee is the trustee of a simple trust, with no an equitatle estate. Tlie legal estate is in the person wlio holds the property for another ; the equitahle estate is ia the person beneficially interested. The dis- tinction between law and equity is, "within certain limits, real and natural, and it would be a mis- take to suppose that what is real and natural ought to be disre- garded, although under our pre- sent system it is often pushed beyond these limits." Hans. N. S., vol. 214, p. 339. The legal estate, therefore, stUl subsists ; and although I have heard it doubted by oonveyauoers of abil- ity, whether it is necessary for a purchaser to get in a legal estate vested in a bare trustee, on the ground that the equitable estate is now recognized by all the branches of the High Court, and that therefore the equitable owner can never be harassed vexa- tiously by the mere dry legal owner, yet I conceive that this opinion cannot be supported, for, as Mr. Lewin says, "A trust is not part of the land, but an inci- dent made to accompany it ;" in short, it is not binding on the land, but is merely annexed in privity to the person ; and to entitle a cestui que trust to relief in equity, he must not only show the creation and continuance of the trust, but also that the pre- sent owner of the legal estate is personally privy to the equity. The protective efficacy of the legal estate is, therefore, it is appre- hended, stUl very considerable. And see sect. 48 of Land Trans- fer Act, 1876, repealing sect. 7 of Vendor and Purchaser Act, 1874. (c) This is taken from the de- finition of "a bare trustee," adopted by Hall, V.-C, in Chris- tie V. Ovington, L. E., 1 Ch. Div. 279. (d) The convenience of having some distiactive term by which to designate a trustee who has duties to perform must be my excuse for inventing this term. (e) Lewin, 18. 2 4 PSITATE THrSTS AITO TETJSTEES. duty to perform, except to convey to the cestuis que trust. An executive trustee is the trustee appointed to carry out a special trust. In relation to their inception, trusts are divisible into two classes (/). f a. A declared or express trust means a trust created by words either expressly or impKedly evincing an intention to create a trust in respect of certain property, for a particular purpose. /S. A constructive trust means a trust which is not created by any words either expressly or im- pliedly evincing a direct intention to create a trust, but by the construction of equity, in order to satisfy the demands of justice {g). In relation to their construction and enforcement, trusts are divisible into two classes. a. An executed trust means a trust in which the limitations of the estate of the trustee and the cestuis que trust are perfected and declared by the settlor {/?.) . ^. An executory trust means a trust in which the limitations of the estate of the trustee or of the cestui que trust are not perfected and declared by the settlor, but only certain instructions or heads of settlement declared by him, from which the trustee is subsequently to model, perfect and de- clare the trust (»). A trust based upon value means a trust created by (/) This classification seems by precatory words), are in real- to me to be preferable to that ity declared trusts, usually adopted of express, im- (g) Smith's Eq. Man. llth ed. plied, and constraetive trusts. 17S. independently of the fact that it (h) See Stanley v. Lennard, 1 is generally immaterial by what Eden, 95. name you call a trust, I have (t) See AuUen v. Taylor, 1 ventured to disregard the usual Eden, 366 ; Lord Glerm-chy v. classification, because implied Bosville, Eor. 3 ; and Stanley v. trusts, properly so called, are in leimard, sup.; and see per Cairns," reahty constructive trusts, and l,.G.,ixx Sackville JFest v. Solmes- implied trusts, loosely so called dale, L. R., 4 H. L. 543. (as, for instance, trusts created DEriNITIONS. 5 the settlor, upon such consideration as would sup- port a contract at law. Illtjst.-7-1. a trust of leasehold property to which lia- bilities are attached is always based upon value, inasmuch as the cestui que trust thereby takes upon himself the primary discharge of those Kabihties (k). 2. Where there are mutual promises, each is a valuable consideration for the other. Thus it is settled, that if husband and wife, each of them having interests, no matter how much, or of what degree or of what quality, come to an agreement which is afterwards embodied in a settle- ment, that is a bargain between husband and wife, which is not a transaction without valuable consideration {I). A voluntary trust means a trust created by the settlor either e.v meri motu or in consideration of a mere moral obligation or natural love and affec- tion {m), or a trust made to take effect by way of remainder, after satisfaction of a trust based upon value and not coming within the scope of the con- tract (■«) upon which the latter was founded. IimsT. — 1 . In general, in a marriage settlement by an intended husband, where there are the usual life estates to himself and wife with remainder to the issue and in default of issue to the settlor's next of kin, the latter limitation is voluntary, because it cannot be presumed that the benefit of the husband's next of kin out of his property was within the scope of the bargain for the settlement made between him and the wife (o). (7i;) Price v. Jenkins, L. E., 5 v. Crofton, 3 J. & Lat. 43. Ch. Dif. C19. i 2. t^t^i /\ ISy, (n) Osgood v. Strode, 2 P. W. {I) Teasdale v. Braithicaite, L. 245 (overrulmg J««4i«i v. -STemesA, K., 4 Ch. Div. 90 ; aff., L. R., 5 2 P. W. 252, and Hale v. Lamhe, Ch. Div. 630/^,^gg_a.tfe)- (t T.ister, 2 Ed. 292) ; Johnson v. Legard, 3 L. E., 6 Ch. Div. ?0i ^~~^ii^ Mad. 283, and T. & K. 66, 281 ; (m) See Eastwood^^Kenyon, H Staclcpoole v. Stmlcpoole, 4 Dr. & A. & E. 447; BeaumohtY. Meeve, War. 320; Smith v. Cherril, L. 8 Q. B. 483 ; Tweddle \. Atkin- E. , 4 Eq. 390 ; WoUaston t. Tribe, son, 1 B. & S. 393 ; Jeffry r. Jef- L. E,., 9 Eq. 44. fry, 1 Cr. & Ph. 138 ; and Moore (o) See Dart, V. & P. 894. b PBIVATE TRXTSTS AND TETJSTEES. 2. But -v^liere the presumption can naturally arise that the ultimate limitation was part of the marriage bargain, it is apprehended (in spite of some authorities to the contrary (p)) that it is not then voluntary. Thus, in Clarke v. Wright {q), Blackburn, J., said, "It seems to me, that though in general it may be supposed that on a marriage treaty, after the interest of the intended husband and wife and the issue of the marriage is provided for, the remainder of the estate is left to be disposed of as the party to whom that would revert pleases ; yet that when we find the interests of the husband, wife, and issue so much affected by the settlement, we must take it that it was agreed by all parties, as part of the marriage bargain, that the estate should be thus settled — that the wife agreed to marry the husband on the terms that this settlement should be thus made. If this be so, the question comes to be, if a limitation in favour of a third person, not merely inserted in the marriage settlement, but appearing from its nature to have been made one of the terms of the marriage bargain, is to be considered voluntary, or is to be considered as made for the valuable consideration of marriage ? In my opinion the case would have been the same if the plaintiff had been some distant relation of the wife's first hu.sband, or even a stranger in blood. The husband got the enjoyment of some part of the wife's property, which he could not have had if the marriage had not taken place. He may have got this on cheaper terms ; he may have been allowed to take a larger portion of her personal estate than he would have been permitted to take if this settlement had not been made; or he may have been allowed to keep free a greater portion of his own property 'than he would otherwise have done, and in consideration of these substantial benefits to himself he may have become a party to a contract for this limitation (p) WoUttston T. Tribe, L. R., L. E., 4 Eq. 390. 9 Eq. 44; Johnson v. Lei/ard, T. {q) 30 L. J., Ex. (Ex. Ch.) & E. 66, 281 ; Smith v. Cherril, 115, and 6 H. & N. 849. DErnnTiONs. 7 It seems to me, that as on every marriage settlement there are reciprocal considerations between husband and wife, we ought not to hold a limitation, which is not merely- included in the marriage settlement, but appears from its nature to have been really one of the terms of the marriage bargain, to be voluntary." 3. And so where a widow or widower on a second marriage makes provision for the children of a first marriage, as well as for those of the second marriage, it is presumed to be within the scope and object of the marriage bargain, and therefore based upon value (?■). 4. And so generally, it is laid down by Mr. Dart (s), in a passage approved of by the present Lord Blackburn and the late Mr. Justice Willes {t), that where the limitations over are in favour of the collateral relatives, not of the settlor but of the other party, the settlement may be considered prima facie evidence of such other party having stipulated for their insertion. And so where on a settle- ment of an intended wife's estate, the limitations over are in favour of her own collateral relatives, in derogation of the husband's marital rights. But where in other cases the limitations over are in favour of the collateral relatives of the settlor, such presumption cannot so readily arise; but it might be proved that the other parties stipulated for their insertion. If such a stipulation cannot be pre- sumed or proved, the limitations over must, it is conceived, be considered voluntary. A breach of trust means any act or neglect on the part of a trustee, wMch is not authorized or excused, either by the settlement or by the doctrines of judicial equity. (/) Newstead v. Searles, 1 Atlc. Div. Ui.% Z-^-^-r^K y/^: 265 ; ItUU V. Beane, 1 Ves. Sen. is] Dart's V. & P. 894. 216; Gale v. Gale, L. E., 6 Ch. (<) ClarU v. Wright, sup. Division I. DECLARED TRUSTS. SuB-DiT. I. — Introduction. Aet. 2. Analysis of a declared Trust. SuB-Div. II. — The creation of declared Teitsts. Aet. 3. language declaratory of a Trust, i. Illusory Trusts. 5. Formalities immaterial where Trust based on Value. 6. Formalities material witere Trust voluntary. 7. The Trust Fi-operty. 8. The expressed Object of the Trust. 9. Necessity of writing. SuB-Drv. HI. — Yaiiditt of declared Trusts. Aet. 10. WIio may be a Settlor. ,, 11. Who may be a Cestui que trust. „ 12. Validity as between Settlor and Cestui que trust. „ 13. Validity as against Creditors. „ 14. Validity as against Trustee in Bankruptcy. „ 15. Validity as against subseqtient Purchasers. Stjb-dit. IV. — Construction of declared Trusts. Aet. 16. Executed Trusts construed strictly, and Executory liberally. ( 9 ) SUB-DIYISION I. Introduction. Art. 2. — Analysis of a declared Trust. Where a person has used language from which it can be gathered that he intended to create a trust {a), and such intention is not negatived by the surrounding circumstances (6), and the settlor has done such things as are necessary in equity to bind himself not to recede from that intention (c), and the trust property is of such a nature as to be legally capable of being settled (d), and the object of the trust is lawful (e), and the settlor has complied with the provisions of the law as to evidence (/), a good and valid declaration of trust has (primS. facie) been made. But a trust prima facie vaHd, may yet be impeachable from incapacity of the settlor {g), or of the cestui que trust {/>), or from some mistake or fraud attendant upon its creation («') ; or again it may be valid as between the parties, and yet invalid as against the settlor's creditors (k), trustee in bankruptcy (l), or as against subsequent purchasers (tn) ; and lastly, the circumstances under which the trust was created, may be such as to necessitate a very liberal construction being given to the language in which it was declared, so as to give efEect to the manifest intentions of the settlor (n). In the following articles, these several matters will be treated of separately, and in the order in which they have been above referred to. («) Art. 3. (/) Ai-t. 9. (k) Art. 13. {b) Art. i. (g) Art. 10. (t) Art. 14. , (c) Arts. 5, 6. (h) Art. II. (m) Art. 16. {d) Art. 7. (i) Art. 12. («) Ai-t. 16. (e) Art. 8. 10 DECLAEED TEUSTS. SUB-DIVISION n. The Creation of declared Trusts. Art. 3. — Language declaratory of a Trust. No teolmical expressions are necessary in order to raise a trust (a) ; any will suffice, from ■which it is clear that the settlor intended to create a trust, or to confer a benefit best carried out by means of a trust, provided that the objects, the property, and the icay it shall go, are clearly pointed out (b). And subject to this proviso, the following prin- ciples are of importance in construing a settlor's intentions : — cc. Words of confidence, direction, subjection (c), or proviso {d), in general raise a trust ; j3. Where a settlor empowers a person to dis- pose of property in favour of another in a par- ticular event (e), or among a class, or some of a class, and there is no gift over in default af ap- pointment, a general iatention to benefit such individual or class wiU be presumed . and the power wlU. be construed as a trust (/). y. When property is given to one, who is by the donor recommended or requested to dispose of it in favour of another, these words create a trust. Subject to this, that if the donee was to have a (o) Sipple V. Corks, 11 Ha. (c) See Tweedale t. TweedaU, 184; Cox r. Tage, 10 Ha. 163. L. R., 7 Ch. Div. 633; Wheeler (i) Knight v. Knight, 3 B. U8. t. Warner, 1 S. & S. 30eG: &S. 552; Sigger v. Simpson, 5 H. L. C. 121. v. Evans, 5 EE. & B. 367 ; Gould [d) Per Sir John Leach in v. Soiertson, 4 De G. & S. 509. Acton v. Woodgate, sup. (/) Worral v. Barford, S Ves. (c) Per Lord St. Leonards in 4; see a\so Ex parte leiercu.'L.'R., Field T. Eonoughmore, 1 Dru. & 9 Ch. 33. g" i-^-^ /C 6/» TEUSTS BASED ON VALTJB. 19 3. But where there is a positive direction to the trustees to employ a particular person and to aHow him a salary, a trust is created in his favour (^); a mere recommendation or expression of desire is, however, not sufficient (A) for this purpose. Art. 5. — ForinaliUes immaterial where Trust s based on Value or declared hy Will. Where a trust is based upon value, or is created by ■will (ff), it is immaterial whether it is in its nature complete and executed, or merely rests in contract, and whether the settlor has declared himself or another a trustee, or has omitted to appoint any trustee ; for equity will never allow a trust to fail for want of a trustee, but will, if the settlor has used language sufficiently explicit to enable the coiirt to gather his intentions, fasten the trust upon the estate, and will hold the person in whom it becomes vested to be bound in conscience to per- form the trust, unless he be a purchaser for value and without notice {b). Illitst. — 1. Thus where a marriage settlement contains a covenant by the intended husband that he will duly vest in, and transfer to, the trustees, any property which may accrue to him in right of his wife diu-ing the marriage, upon any property so becoming vested in him, he imme- diately becomes a trustee of- it, in the first place, upon trust to transfer it to the trustees, and until that is done he himself holds it upon the trust declared in the settle- ment (c) ; so that, not only is there an action for breach of (g) Williams v. Corbett, 8 Sim. (b) See Art. 75. 349 ; JLibbert y. Hibbert, 3 Mer. (c) See Lewis v. Maddocks, 8 681. V. 150; and see Wellesleij v. Wel- (A) Slmw V. Lawless, 1 Dr. & lesley, 4 M. & C. 561; LtjsterY. Walsh, 512. Burroughs, 1 Dr. & W. 149 ; (ffi) See Lew. 60, 114, 678; Lee Stock v. Moyse, 12 Ir. Ch. Eep. V. Lee, L. R., 4 Ch. Div. 175- 246. Jte Michell, L. K., 6 Ch. Div. lilW\ 20 BECLAEED TETJSTS. covenant maintainable against him, but the actual property is burdened and charged -with the executoiy trust id ), and any volunteer taking it would take it burdened with that trust ; and so would a purchaser if he had notice of the trust, as will be seen hereafter. 2. And so if lands be devised (e), or money be- qtieathed(/), to a married woman for her separate use, the property vests at law in the husband; but in equity ho holds it upon trust for the separate use of the wife. 3. So if the trustee appointed, fails, either by death {) Sup. LEGALITY OF THE OBJECT. 35 thing contrary to public policy during a testator's lifetime, than it does for any other purpose." 11. A trust to take effect upon the future separation of a husband and wife is void, as being contrary to public morals (x) ; but a trust in reference to an immediate sepa- ration, already agreed upon, is good and enforceable (y). If, however, the separation does not in fact take place, the trust becomes wholly void (z). The reason of aU this is at •once obvious, when we consider that a provision for hus- band or wife, to take effect upon a future separation, is a direct encouragement to misconduct, which may eventuate in a separation ; whereas, when a separation is actually agreed on — when both parties have decided that they wiU no longer remain together — there can be no encouragement to marital misconduct in agreeing to the distribution of their income in a particular manner and for their mutual benefit and advantage. 12. Where property is settled in trust for a woman untU. she marry a man with an income of not less than 500^. a-year (a), or until she marry any person of a particular trade (5), and then over in trust for another, the latter trust is bad, as its object, as gathered from its probable result (c), is to restrain marriage altogether. 13. If, however, the trust over is to take effect only upon the first cestui que trust marrying a particular person, it would be good, as it would not be in general restraint of marriage (d). 14. So where (e) a person by her will gave her residuary ■estate to trustees, upon trust to pay the income to her (x) Westmeath v. Westmeath, 1 (a) Sm. E. & P. Prop. 80; Dow., N. S. 519; Proctor v. Story, 280—283. Robinson, 15 W. R. 138. lb) lb. («/) Wilson V. Wikon, 1 H. L. (c) lb.; and Story, 274—283; Cas. 538 ; 5 H. L. Cas. 40 ; Van- Lloyd v. Lloijd, 2 Sim. N. S. 255. sittart V. Vansittart, 2 D. & J. (d) Sm. R. & P. Prop. 81— 249; Jodrell v. Jodrell, 9 B. 45; 107. arid see 14 B. 397. (e) Mien v. Jackson, L. E., 1 (z) Bindley v. Mulkney, L. E., Cli. Div. 399. / S^ C^^i^ /? (P7 5^ 7 Eq. 343. ' D 2 36 DECLAEED TEtlSTS. nephew and Ms -wife (tlie testatrix's niece) for their joint lives and the. life of the survivor, with a gift over (in the event of the nephew surviving and marrying again) in trust for the children of her said niece, and in default of such children, for the children of the testatrix's sister, it was held that the gift over was good ; and Mellish, L. J., in delivering his judgment, said: "It has heen said with respect to this rule against restraint of marriage that it has no foundation on any principle ; that it has nothing to do with public policy, but that it is a positive rule of law, adopted nobody can tell why; and that, because it is a positive rule of law, adopted nobody can tell for what reason, and without any regard to public policy, therefore it is impossible to make an exception to it, and that the court can do nothing with it but carry it out. I cannot agree with that. It may be, no doubt, that in these modern times we should not for the first time establish such a rule of public policy, but of course if a rule has been established as a rule of law because it was thought agreeable to public policy and to the interests of the nation at the time it was established, it may be that the court cannot alter it because circumstances have altered. ... If then there was such a rule of public policy, we are to con- sider how does that rule apply to second marriages? It has never been decided that it applies to second marriages. ... It appears to me very obvious that, if it is regarded as a matter of policy, there may be very essential distinc- tions between a first and a second marriage ; at any rate there is this, that in the case of a second marriage, whether of a man or a woman, the person who makes the gift maj- have been influenced by his friendship towards the wife in the one case, and towards the husband in the other case ; that is to say, regarding the case of some member of the husband's family, he may make a gift to the husband for life, and then make a gift to the wife because she is the wife of that particular husband, and because he thinks it NECESSITY OF WBITISG. 37 is more for tlie benefit of tlie cMldren that the wife should have the money while the children are young rather than that the children should have it." Art. 9. — Necessity or otherwise of Writing and Signature. a. All declarations of trust of freehold, copyhold (ff) , or leasehold (6) lands, tenements, or hereditaments, must be manifested and proved by some ■writing, or by a last will, showing clearly what the intended trust is, or referring to some other document which shows clearly what the trust is ; and the declaration of trust (but not necessarily any other writing re- ferred to thereby) must be signed by the party who is by law enabled to declare the trust, or else it is wholly void (c) : Provided that the rule does not apply where it would operate so as to effectuate a fraud {d). Where the legal estate is vested in a trustee for an absolute beneficial owner, the latter is the proper party to declare the trust (e). ^. Declarations of trust of personalty, other than chattels real, may be made by word of mouth (/). Illtjst. — 1. In Foster v. Hale, a gentleman named Biu'don had a share in a colliery, and the suit was for the purpose of fixing a trust upon his share for the benefit of his part- ners in a bank, in which he was also concerned. Lord Alvanley, after commenting upon the conduct of the plaintiffs, said : " But it is insisted, that though their names do not appear upon the lease, nor that they pub- licly, even by inquiry, ever busied themselves about the [a) Withers v. Withers, Amb. (e) Kronhcimy. Johnson,!^. R., 152. 7 Ch. Div. 60^^J%erney v. Wood, {b) Foster v. Male, 3 Ves. 696. 19 B. 330; SudkmvrSvimfmy-^ {c) Statute of Frauds, 29 Car. 2, L. T. 791. u. 3, s. 7. (/) McFadden v. Jenkins, 1 Ph. (d) See per Lord Wesfbury in 157; Hawkins v. Gardner, 2 Sm. M'Cormick v. Grogan, L. E,., 4 • & G-. 451; Benbow v. Toionsend, H. L. 82 ; Strickland v. Aldridge, 1 M. & K. 506 ; Middleton v. Fol- 9 V. 219. lock, L. E., 4 Ch. Div. 49^/f fi, 38 DECLAEED TETJSTS. colliery ; yet in fact an agreement took place that lie, Burdon, should be a trustee as to his share for them (the plaintiffs) and himseK, in equal shares. They say they can make it out satisfactorily to the court and -within the Statute of Frauds, and that not by any formal declaration of trust, but by letters under his, Burdon's, hand, and signed hy him, in which they allege he admitted himself such trustee, and that, under the true meaning of the statute, it is sufficient if it appears in writing under the hand of a person having a right to declare himself a trustee, and that is a formal declaration of trust. It was contended for the defendants that there is great danger in taking a declaration of trust arising from letters loosely speaking of trusts, which might or might not be actually and definitely settled between the parties with such expres- sions as 'our,' 'your,' &c., intimating some intention of a trust ; that upon such grounds the court may be called upon to execute a trust in a manner very different from that intended, and that it is absolutely necessary that it should be clear from the declaration what the trust is. That I certainly admit. The question, therefore, is, whether sufficient appears to prove that Burdon did admit and ac- linoivledge himself a trustee, and whether the terms and con- ditions on which he loas a trustee sufficiently appear. I do not admit that it is absolutely necessary that he should have been a trustee from the first. It is not required hy the statute that a trust should he created hy a ivriting .... hut that it shall he manifested and proved hy writing ; plainly meaning that there should be evidence in writing, proving that there was such a trust. Therefore, unquestionably, it is not ne- cessarily to be created by writing, but it must be evidenced by writing, and then the statute is complied with. I admit that it must be proved in toto, not only that there was a gift, but what that gift was." 2. In Smith v. Matthews {g) the husband of one Mrs. (r?) 3 De a., F. & J. 139. NECESSITY OP ■WBITUfG. 39 Matthews, being a person of dissolute habits, got into diiiioixlties ; and thereupon, one Clark, the brother of Mrs. Matthews, entered into an arrangement with Matthews, whereby the latter conveyed to him certain real property, and a certain business, in consideration of his undertaking to pay off all his, Matthew's, debts. Clark entered into possession, and carried on the business for the benefit of his said sister and her children. There was no explicit and formal declaration of trust by Clark, but from several letters it appeared that Clark considered that he held the property "for the benefit of Mrs. Matthews and her family;" and by a memorandum given to the mortgagee, upon paying off the mortgage on the property, it was ex- pressly stated that the title deeds had been handed over to Clark "as the trustee of the real and personal estate of Mrs. Matthews." Clark having died intestate, the lands descended at law to Mrs. Matthews as his heir-at-law, and thereupon her husband tried to get possession of them jure mariti. In order to resist this attempt, it was contended that Clark had constituted himself a trustee for Mrs. Matthews and her children, and that the property there- fore devolved, burdened with the trust. Lord Justice Turner, however, held that the triist was not expressed with siifficient certainty in any of the documents, and said, " it must be manifested and proved by writing, signed as required, what the trust is ; . . . the main reliance was placed on the memorandum ; but I think it by no means improbable that, in speaking of himself as trustee in that memorandum, Clark may have meant no more than that he considered himself a trustee with reference to the duty which he had undertaken for the payment of Matthews' debts ; and at all events the memorandum does not show what was the trust to which it refers, and I think, therefore, that no trust in favour of Mrs. Matthews can be founded upon it." 3. In Kilpin v. Kilpin (Ji) a person transferred stock into (A) 1 M. & K. 521. 40 DECLAEED TEtrSTS. the name of an illegitimate daughter and her husband and their two eldest children, and by parol declaration, confirmed by an unsigned entry in a memorandum book, declared that such investments were to be for the benefit of all his daughter's children. Held a good declaration of trust, as the stock was mere personalty. 4. So in McFadden t. Jenkins (i) a creditor desired Ms debtor to hold the debt in trust for A. The debtor ac- quiesced, and paid over part of the money to A. ; and it was held that the creditor had made a valid declaration of trust, and had constituted the debtor a trustee of the debt for A. 5. But where a father is induced not to make a will by statements of his heir presumptive, that the latter would make suitable provision for his immediate relatives, the court considers that that is a fraud, and, notwithstanding the statute, will oblige the heir to make a provision in conformity with his implied obligation {h). For, as was said by Lord Westbury, in McCormich v. GroganiT), " the court has from a very early period decided that even an act of parliament shall not be used as an instrument of fraud ; and if in the machinery of efitectuating a fraud an act of parliament intervenes, a court of equity, it is true, does not set aside the act of parliament, but it fastens upon the individual who gets a title under that act, and imposes upon him a personal obligation, because he applies the act as an instrument for accomplishing a fraud. In this waj^ a court of equity has dealt with the Statute of Frauds, and in this manner also it deals with the Statute of WiUs ; and if an individual on his deathbed, or at any other time, is persuaded by his heir-at-law or next of kin to abstain from making a will, or if the same individual, having made a win, communicates the disposition to the person on the face of the wUl benefited by that disposition, but at the (t) 1 Ph. 153. 9 V. 219. \k) Sellach v. Marris, '5 Vin. [1) L. R., 4 H. L. 82. Ab. 521 ; Strickland v. Aldridffe, ITEOESSITY OF "WHITDSra. 41 same time says to tliat indiyidual tliat he has a purpose to answer which he has not expressed in the will, but which he depends upon the disponee to carry into effect, and the disponee assents to it, either expressly or by any mode of action which the disponee kaows must give to the testator the impression and belief that he fully assents to the re- quest, then undotibtedly the heir-at-law in one case, and the disponee in the other, will be converted into trustees, simply on the principle that an individual shall not be benefited by his own personal fraud." 42 declabed tetjsts. SUB-DIVISION in. Validity of Declared Teusts. Aet. 10. — Who may he a Settlor. Every person who can hold or dispose of any legal or equitable {a) estate or interest in property may create a trust in respect of such estate or interest. Illust. — 1. Practically speaking, an infant cannot now effectually dispose of property so as to bind himself ; and, therefore, cannot in general make an irrevocable settle- ment. However, males over the age of twenty and females over the age of seventeen years can now upon marriage, with the approbation of the Higli Court (acting in pur- suance of the power given to it by the statute 18 & 19 Yict. c. 43, explained by 23 & 24 Vict. c. 83), make biading settlements of real and personal estate belonging to them in possession, reversion, remainder, or expectancy. 2. A married woman cannot in general dispose of her property without the consent and joinder of her husband, and in accordance with the provisions of the Pines and Eecoveries Abolition Act. But with regard to property which is her separate property in equity, either under a settlement or the Married Women's Property Act, 1870, she is considered a feme sole, and may therefore either dis- pose of it or settle it (unless restrained from anticipating it) (5). So, again, she may dispose of property over which she has a general power of appointment, and her hus- band's concurrence is not necessary (c) ; and as she can (a) Gilbert v. Overton, 2 H. & (c) Burnet t. Mann, IVez. 156; M. 110; Kekewich v. Manning, 1 Wright v. Lord Cadogan, 2 Eden, Hare, 464; Donaldson v. Donald- 239; Doe d. Dlomfeld t. Hyre, 5 «o«, Kay, 711. 0. B. 713; Lady TraveVs case, (A) See judgment in Noble v. cit. 3 Atk. 711. Willock, L. E., 8 Ch. 787. /-C^uf/iJ. f. THE CESTUI QUH TEUST. 43- dispose of it, so also, in accordance ydth. the rule, she can create a trust in respect of it (y). 3. A convict "while such («'. e. until he has worked out his sentence or been pardoned) is incapable of disposing of his property ; and, consequently, cannot create a valid trust in respect of it (a). Aet. 11. — WTio may he a Cestui que trust. Every person who can hold property may lawfully be a cestui que trust of it («) ; but a cestui que trust must be a human being or beings (h). Illijst. — 1. A corporation cannot be cestui que trust of lands without licence under the Mortmain Acts (c), for without such hcence it cannot hold lands, and therefore cannot take through the medium of a trust. 2. Similarly, before the act 33 Vict. o. 14, an alien, as he could hold property against everyone except the crown, could also be cestui que trust of land as against everyone except the crown (c?); but as he could not take a legal estate by operation of law, so likewise he could not be a cestui que trust by act of law (e). As the above act is not retrospective, it would seem that aliens who acquired lands anterior to the passing of the act are not protected by it, and that the crown is entitled to all lands of which they are cestui que trust (/). 3. A trust for keeping up family tombs is void, because there would be no human cestui que trust (y). A trust, on the other hand, for keeping up a church might be valid as (j/) See judgTiient of Westbury, L. R., 14 Eq. 45; Dawson t. L. C, in Tmjlor v. Meads, 34 Small, L. B., 18 Eq. 104. /^U^ L. J., Ch. 203; 13 "W. R. 394. (c) Lew. 40. ^ / (z) 33 & 34 Vict. 0. 23. (d) Sarrow v. WadJcin, 24 B. 1; («) Lew. 39. Mitson t. Stordij, 3 Sm. & GifB. [b) Richard v. Rohson, 31 B. 230; Sharp v. St. Savmr, L. K., 244; LloydY. Lloyd, 2 Sim., N. S. 7 Ch. 351. 255 ; Tlwmpson v. Shakespeare, {e) Cal/viri's case, 7 Rep. 49. Johns. 612; Fowler t. Fowler, 33 (/) Sharp -v. St. Saveur, sup. B. 616; Fish-^. Att.-Oen.'L.'&., (g) Richard v. Robson, 31 B. 4 Eq. 521; Hunter v. Bullock, 244. 44 DECLAEKD TEtrSTS. a charity, as it would be in reality a trust for the 'beiiefi.t of the congregation (A). Akt. 12. — Validity/ as between Settlor and Cestui que trust. A settlor cannot revoke or vary a voluntary trust (a) (and, a fortiori, a trust based upon valuable con- sideration), unless there has been some fraud or undue influence exercised to induce him to create the trust (J), or unless he executed the settlement in ignorance of its legal efEect (c) ; and not even then, if he has acquiesced in or acted upon the settlement after the influence has ceased or after he has become aware of the legal effect of the set- tlement {d). And unless there is at least a meri- torious consideration, it will in general, and par- ticularly where the cestui que trust stood ia the relation of parent (e), guardian, counsel, solicitor, doctor, priest, or trustee (/) to the settlor, be in- cumbent upon the cestui que trust to prove that aU the provisions are proper and usual, or if there are any unusual provisions that they were brought to the knowledge of and were understood by the settlor {g) . No general rule can be laid down as to what are proper and usual provisions, but a power of revocation is not essential ((/) . Illust. — 1 . A father transferred a sum of stock into the Joint names of his son and of a banker, and told the latter (h) Soare v. Osborne, L. E., where a provision for daughters 1 Eq. 585; Se Sigley's Trusts, 1 was omitted by the engrossing W. R. 342. clerk, He Daniell, L. E., 1 Ch. {a) Crabbe v. Crabbe, 1 M. & K. Div. 375; and see Clarice v. Gird- 506; SidmoutliY. Sidmouth, 2 B. wood, liJu., 7 Cih. Div. 9^^^-^^3^ 455. (d) Jmvies v. Davies, L. R., 9 (i) Osmond v. Fitzroy, 3 P. "W. Eq. 468, and cases cited. 129; Buguenin v. Baseley, 14 V. [e) JJavies \. Davies, sup. 273; Dent v. Sennett, 4 M. & C. {f)byUon v. Bylton, 2 Vez. 277; Soghton v. Soghton, 15 B. 6iT ; BmiterY. Atkins, 3 M. &K. 299; Cooke Y. Zamotte, 16 B. 2U. US; Tate r. Williamson, Ij. R., (c) Fhillips v. Mullings, L. E., 2 Ch/. 55. 7 Ch. 244; FanshaiAie v. Welshy, (gh Fhillips v. Mullings, sup. 30 B. 343 ,'\and see as to mistake / VALIDITY AS AGAINST SETTLOE. 45 to cany the dividends to the son's account ; the father sub- sequently made a codicil to his will, attempting to qualify the trust thus declared. The Master of the EoUs, ho-wever, said : "If the transfer is not ambiguous, but a clear and imequivocal act, I must take it on the authorities, that for explanation there is plainly no place. If, then, it cannot be admitted to explain, stUl less can it be allowed to qualify the operation of the previous act, the transfer being held an advancement, nothing contained in the codicil, nor any other matter ex post facto, can ever be allowed to alter what has been already done " (i). 2. In Phillips v. MulUngsiJc) the facts were these: A young man of improvident habits, being entitled to a sum of money, was indu.ced by the trustee of the money and by a solicitor to execute a settlement, by which he assigned a part of the money to trustees upon trust to invest and to pay him during his life the income thereof as they should think fit, and after his death upon trust for his wife and children (if any), and in default thereof and subject thereto upon trust for certain of his cousins. There was no power of revocation or of appointment, nor a power to nominate new trustees ; the deed was, however, fully explained to him before its execution, and his attention called to the particular clauses. Some years afterwards he attempted to upset this deed, but the court held that it was irrevocable, Lord Hatherley saying : "It is clear that anyone taking any advantage under a voluntary deed and setting it up against the donor must show that he thoroughly understood what he was doing ; it cannot, however, be laid down that such a deed would be voidable unless it contained a power of revocation " {I). This case would seem to greatly modify the decisions in Coutts v. Acicorth (m), Wollaston v. Tribe {n), and Everitt v- EveriU{o), the latter of which (i) Crahhe v. Crabic, mp. L. E,., 8 Ch. 329. 6~Z^.^ f^ i>^S' \K) Sup. (m) L. E,., 8 Eq. 558. ' [1) See also Soghton v. Sogh- («) L. E., 9 Eq. 44. ton, 15 B. 278 ; and Mall v. Hall, (o) L. K., 10 Eq. 405. 46 DECLAEED TRITSTS. would seem to have been practically overruled, the circum- stances being the same as in Phillips v. Mullings (with the exception that the settlor was a young and inexperienced girl instead of a dissolute young man), and the decision exactly opposite. 3. On the other hand, in the leading case of Huguenin v. Baseley {p), where a widow lady, very much under the influence of a clergyman, made a voluntary settlement in his favour, it was held to be invalid. 4. So, where a father induced a young son, who was stni under his roof, and subject to his influence, to make a settlement in favour of his step-brothers and sisters, it was held, that if the son had applied promptly, the court would have set it aside ; but that as he had remained quiescent ior some years, and had made no objection to the course which he had been persuaded to follow, he was not en- titled to relief ; on the ground that by so doing, he had in his maturer years practically confirmed that which he had done in his early youth (j'). Nor will the court interfere where the settlor subsequently acts under the deed, or does something which shows that he recognizes its validity {r), unless indeed he was ignorant of the effect of the settle- ment at the date of such recognition {s). 5. Where a person, apparently at the point of death, signed a settlement of which he recollected nothing, which was never read to him, and in which a power of revocation was purposely omitted by the solicitor on the ground that he knew the variable character of the settlor, and there was also evidence that the settlor thought that he was executing the settlement in place of a wiU, it was held that the settlement was revocable {t). (p) 14 V. 273 ; and 2 L. C. 556. wood, 18 V. 259 ; Dmies v. Hams, [q) Turner v. Collins, L. K., 7 L. R., 9 Eq. 468. Ch. 329. ^^t^ r^ ^o (s) i^ist^ ^_ Sodgson, L. R., 4 ()•) Jarratt v. 'AWon, L. R., 9 Eq. 30. Eq. 463 ; Motz v. Moreau, 13 M. («) Fanshaw v. Wclsby, 30 B. 'S.G.ilQ; WrightM.Vanderplank, 243. 2 K. & J. 1 : Milner v. Lord Sare- TAMDITY AS AGAlNStT CEEDITOES. 47 6. Wliere a settlor has been induced by fraud to make a settlement, -whether voluntary or based upon value, it will not be enforced ; as, for instance, where a wife iuduces her husband to execute a deed of separation, in contempla- tion of a renewal of illicit intercourse (m). Where, how- ever, it is not in her contemplation at the time, but she does in fact subsequently commit adultery, then, as there was no original fraud, the subsecLuent adultery wiU not avoid the settlement {y). 1. Even where there is valuable consideration given, but the settlor is infirm and ignorant, and there is reason to suppose that he did not fully understand the transaction, it will be set aside, unless it be proved that full value was given {iv). 8. As an example of the action of the court where the settlor has mistaken the eflfect of the settlement, the case of Nanney v. Williams {x) may be referred to. There the settlor made an irrevocable voluntary settlement in favour of a relation who also acted as his solicitor. The court considered from the evidence, that the settlor had intended to reserve to himself a power of revocation, and held, that although the deed was otherwise unobjectionable, and would have been valid if the settlor had died intestate and without having revoked it, yet that he having devised the property by his will, had exercised the power of revocation which ought to have been inserted, and that the settlement was consequently avoided. Art. 13. — Validity as against Creditors. Every settlement of freehold, copyhold (a), or lease- hold lands or hereditaments, corporeal or incorpo- [u) Brown v. Brown, L. E., 7 Clarh v. Malpas, 31 B. 80; Zin- Eq. 185 ; and see Eiians v. Car- quale v. Ledger, 2 Griff. 137 ; and rington, 2 D. F. & J. 481 ; and see O^Rorke v. BoUngbrolce, L. K., Evans v. Edmonds, 13 C. B. 777. 2 Ap. Cas. 814. T-'i^^, /? i^ {») Seagrave v. Seagrave, 13 V. (x) 22 B. 452. ' 443. (a) Formerlynot included (Jfai- {w) Baker v. Moiik, 33 B. 419 ; thews v. Fcaver, 1 Cox, 272), but 48 BECIiAJBED TErSTS. real, or of such kinds of goods and chattels as are capable of being taken ia execution {b), is void as against existing and future creditors of the settlor, in the following cases : — a. If there is direct and positive evidence of an intention to defeat or delay such creditors, inde- pendently of the consequences which may have fol- lowed, or which might have been expected to follow the settlement (c). |3. If (although there is no direct proof of such iatention) the settlement is voluntary, and the circumstances are such that the settlement must necessarily have the effect of defeating or delaying such creditors, and whether some of the debts existing at the date of the settlement still remain unpaid {d) or not (e). The mere fact that such a settlement has in the event defeated or delayed creditors is not sufficient unless that was its pro- bable result (semMe). Such settlements are, however, valid in the hands of persons who are bona fide purchasers for valuable consideration (/), whether from the settlor or from the persons claiming under such settlements. now included by efEect of 1 & 2 (d) Freeman v. Tope, sup. ; Lush Vict. 0. 110, B. 11. V. Wilkinson, 5 V. 384 ; Holmes (5) nider v. Kidder, 10 V. 360. v. Fenney, 3 K. & J. 99 ; Scarf y. As to what goods come xmder tiiis Soulby, 1 M. & G. 375 ; Thompson description, see -Barrac/i; v. JlfcCwZ- v. Weister, 7 Jur., N. S. 531. lock, 3 K. & J. 110 : Stokoe v. (e) Taylor t. Coenen, L. K., 1 Cowan, 29 B. 637. And as to Ch. Div. 636; tut see Kidney v. ctoses in action, Norciit t. Dodd, Coitssmaker, 12Y. 1^6; Totmsendv. Cr. & Ph. 100 ; and 1 & 2 Vict. Westacott, 4 B. 58; Richardson v. c. 110. SmallwQod, Jao. 558 ; Jenkyn v. [c) Freeman v. Fope, L. E., 5 Vauyhan, 3 Dr. 419 ; Freeman v. Ch. 540 ; Spirett t. Willows, 11 Fope, sup. Jur., N. S. 70; Sarmany. Rich- (/) George v. Milbanke, 9 V. ards, 10 Ha. 89; Strongs. Strong, 189; Faulcney^. Cockbui-n, iMer. 18 B. 511; Columbine v. Fenhall, 63S'. And where the consideration 1 Sm. & G. 228; Bott v. Smith, was marriage, and the intended 21 B. 611; Feese Fiver Co. v. wife knew nothing of the fi-audu- Attwell, L. E., 7 Eq. 347; Bar- lent intention, the settlement was ling V. Bishop, 29 B. 417; Fe held goodqua her and her children Fearson, L. E., 3 Ch. Div. 807./fc {Kevan v. Craioford, L. E., 6 Ch. i^ Div. 29). 2;L'C^ /?6 3^6 VALIDITY AS AGAINST CEEDITORS. 49- Obs. — In the above rule I liave attempted to digest the decisions upon the construction of the statute 13 Eliz. c. 5, passed "for the avoiding of feigned, con vinous, and fraudu- lent feoifments, &c., contrived of malice, fraud, covin, collusion, or guUe, to delay, hinder, or defraud creditors or others," bywhich it was enacted, that "all and every feoff- ment, gift, grant, alienation, bargain, and conveyance of lands, tenements, hereditaments, goods, chattels, or any of them, by writing or otherwise, and all and every bond, suit, judgment, and execution to and for any intent or purpose before declared and expressed, shall be deemed and taken only as against that person or persons, his or their heirs, successors, executors, administrators and assigns whose action, suits, debts, accounts, damages, penalties, forfeitures, heriots, mortuaries and reliefs by such guile- ful, covinous or fraudulent devices and practices as is aforesaid are, shall, or might be in any ways disturbed, delayed or defrauded, to be clearly and utterly void, frus- trate and of none effect ; any pretence, colour, feigned consideration, or any other matter or thing to the contrary notwithstanding. By the fifth section it was provided that the act should not extend to any estate or interest in lands, &c., or goods, &c., assured upon good consideration and bona fide to any person not having at the time of such assurance any notice or knowledge of such covin, fraud or collusion. Illitst. — 1. In Twynne's case(^) one Pierce was indebted to Twynne in 40^. and to C. in 200^. 0. brought an action for his debt, and pending the result Pierce conveyed all his goods, to the value of 300Z., to Twynne in satisfaction of his debt ; but Pierce continued in possession of them. Here the court held that there was direct evidence of an intention on the part of Pierce to hinder and delay 0. And although Twynne had given valuable consideration for the goods, yet he was privy to the fraud, and consequently {<,) 1 Sm. L. 0. 1. ir.T. E 50 DECLAEED TRUSTS. could not avail liimself of the proviso in sec. 5. Stress was laid upon tlie fact that Pierce was allowed to remain in possession of the goods, although the conveyance purported to he not a mere mortgage, hut an absolute alienation. Had it been a mortgage, of course the mere fact of the mortgagor retaining possession would have been no badge of fraud, as it is one of the usual incidents of a mort- gage (A). The main and substantial point, however, which the court decided was, that it was obvious, for divers rea- sons, that the conveyance was a mere fraudulent arrange- ment between Twynne and Pierce to shelter the latter from the just demands of his creditors, and was therefore void under the statute. 2. So, again, where a director of a company was sued by the company, and fearing that a judgment would be given against him, made a voluntary assignment to his daughter of all his property, it was held that the fraudulent inten- tion was manifest, and that the settlement was void as against the company, although they were not creditors at the time, and it did not appear that there were any creditors at the time («'). Even though the daughter was no party to the fraud, yet she was not protected, because she had not given valuable consideration. 3. And so again, in Spirrett v. Willoios {J), the settlor being solvent at the time, but having contracted a con- siderable debt which would fall due in the course of a few weeks, made a voluntary settlement, by which he with- drew a large portion of his property from the payment of debts, after which he collected the rest of his assets and spent them in the most reckless way, thus depriving the expectant creditor of the means of being paid. In that case there was clear and plain evidence of an actual inten- tion to defeat creditors, and accordingly the settlement was set aside. (A) Mwards v. Earben, 2 T. E. (;) Reese Siver Co. y. AttwelL 687. L. B., 7 Eq. 347. (/) 3 D. J. & S. 293. TAIIDITY AS AGAINST CUEDITOES. 51 4. And again, wliere one made a voluntary settlement upon Mmself until bankruptcy, and tlien over, it was so clearly intended to defraud creditors tliat it was held void {k). 5. But wliere value is bond fide given by a person for an assignment, even although he may know that the effect of the assignment will be to hinder or defeat the assignor's creditors, or expectant creditors, yet if the transaction be a bona fide purchase, and not a mere collusive arrangement between the parties with the intention of causing such hindrance or delay, it wiU be upheld(Z). 6. In Freeman v. Pope (m) the circumstances, so far as they are m.aterial as illustrating the principle laid down in paragraph g of this article, were as follows: — The settlor was a clergyman, with a life income of about 1,000?. a year ; but at the date of the settlement in question his creditors were pressing him, and he had to borrow from his house- keeper a sum wherewith to pay pressing creditors ; and he handed over to her as security the only property he had in the world and a poUcy of insurance for 1,000Z. upon his own life. The security to the housekeeper exceeded in value her debt by about 200Z. ; but the settlor also owed a debt of 339?. to his bankers, which was subsequently increased at the date of the settlement to 489?. under an arrangement that he would allow his solicitor to re- ceive part of his income, and out of it pay lOOZ. a year towards liquidating the 489?., and would pay the residue into the banker's bank upon a current account. There was no bargain, however, that the bankers would not sue. Being in these circumstances, he executed a volun- tary settlement of the life policy in favour of a Mrs. Pope, and having done so, was consequently in this position, that he had nothing wherewithal to pay, or to give secu- (i-) ije Fcarson, L. R., 3 Ch. Div. Co., 4 Dr. 492 ; and see judgment 807. /P?t->_^ /C i^Y inSarmanv. Richards, 10 Ha. 89. (I) See Darville v. Terry, 6 H. (m) L. R., 5 Ch. 540. &N. 807; Sale v. Saloon Omnibus E 2 52 DECLARED TEUSTS. rity for tlie debt of 489Z., except the surplus value of the furniture, and he was clearly and completely insolvent the moment he executed the settlement. Upon these facts, a subsequent creditor instituted a suit to set aside the settlement, on the ground that although there was no .actual fraud, yet the effect of the settlement was to defraud creditors, and that as there were creditors antecedent to the settlement stlU unpaid («), he could ask for it to be set aside ; and the court held that this was so, Lord Hatherley saying : " The principle on which the statute of Elizabeth proceeds is this, that persons must be just before they are generous, and that debts must be paid before gifts can be made. The difficulty the Yice-ChanceHor seems to have felt in this case was, that if he, as a special juryman, had been asked whether there was actually any intention on the part of the settlor in this case to defeat, hinder or delay his creditors, he should have come to the conclusion that he had no such intention. It appears to me, that this does not put the question exactly on the right ground, for it would never be left to a special jury to find whether the settlor intended to hinder, delay or defeat his creditors, without a direction from the judge that if the necessary effect of the instrument was to defeat, hinder or delay creditors, that necessary effect was to be considered as evidencing an intention to do so Of course there may be cases (of which Spirett v. Willoivs is an example) in which there is direct and positive evidence to defraud ; .... but it is established by the authorities, that, in the absence of any such direct proof of intention, if a person owing debts makes a settlement which subtracts from the property which is the proper fund for the payment of those debts an amount without which the debts cannot be paid ; then, since it is the necessary consequence of the settle- {n) It has been since held that to the settlement is immaterial, the fact of the existence of un- Taylor \. Coe»««, L. E., ICh. Div. paid debts contracted antecedent 636. VAIIDITY ON SETILOE's BANKETEPTCT. 53 ment (supposing it effectual) that some creditors must remain unpaid, it would be the duty of the judge to direct the jury that they must infer the intent of the settlor to have been to defeat or delay his creditors, and that the case is within the statute." And Lord Justice Giffard said : " There is one class of cases, no doubt, in which an actual and express intent is necessary to be proved, that is in such cases as Holmes v. Penney and Lloyd v. Attwood, where the instriunents sought to be set aside were founded on' valuable consideration ; but where the settlement is voluntary, the intent may be inferred in a variety of ways. For instance, if, after deducting the property which is the subject of the voluntary settlement, sufficient available assets are not left for the payment of the settlor's debts, the law infers intent. Again, if at the date of the settlement the person maMng the settlement was not in a position actually to pay his creditors, the law would infer that he intended, by maMng the voluntary settlement, to defeat and delay them That being so, the appeal must be dismissed." Art. 14. — Validity as against Trustee in Bankruptcy of a Trader. a.. A voluntary settlement by a trader (unless the trust property has accrued to him since marriage in right of his wife, and the trust is in favour of his wife or Ms children) is void as against the settlor's trustee in bankruptcy, if he become bankrupt within two years after the date of such settlement ; and if the settlor become bankrupt within ten years it is void, unless it can be shown that he was solvent at the date of the settlement without the aid of the property comprised therein (a). /3. Any covenant or contract made by a trader in (a) Bankruptcy Act, 1869 (32 k 33 Vict. c. 71, ». 91); Ex parte SttxtaUe, L. E,., 2 Ch. Div. 54. 54 DECLAEED xarsTS. consideration of marriage, for tlie future settlement upon or for his wife or children, of any money or property wherein he had not at the date of his marriage any estate or interest, whether vested or contingent (s), in possession or remainder, a,nd not being money or property of or in right of his wife, is, upon his becoming bankrupt before such pro- perty or money has been actually transferred or paid pursuant to such contract or covenant, void against his trustee in bankruptcy. Obs. — It need scarcely be pointed out that these pro- visions are in addition to, and not in substitution for, those heretofore contained with regard to fraudulent settlements. Art. 15. — Validity as against subsequent Purchasers. Every settlement of freeholds, copyholds, or lease- holds («), made with intent to deceive purchasers, or made without any valuable consideration (6), or containing a power of revocation (c) at the will, or practically at the will id), of the settlor, is void as against subsequent bona fide purchasers for value from, or mortgagees (e) or lessees (/) of, the settlor, and it is immaterial that they have had notice of the settlement {g) ; but where there is no actual fraud, the settlement will be void so far only (/?) (::) See Re Andrews, L. H., 7 [d) Standon v. Bulloek, cit. 3 Ch. Div. 635. <2-1>'^^iZs /^-^y^ Eep. 82 b; Lavendfr^r.Blackstme, (a) As to copyholds, see Soe-v. 3 Keb. 526 ; Jenkins v. Kemiss, 1 Bottriell, 5 B. & Ad. 131 ; Currie Lev. 150. v. Mnd, 1 ar. & C. 17; and as (e) Doe v. Webber, 1 A. & E. to leaseholds, see last note to 733; Dolphin v. Aijltcard, L. E., DeMw, 2Ver. 272; 4 H. L. 486 ; Ede v. Knouies, 2 but remember that a settlement Y. & C. C. 172. of leaseholds oaimot in general be (/) Doe t. Moses, 2 W. Bl. voluntary. See " Definitions," 1019. andi")'!!!* v. Jenkins, L. R., o Ch. {g) Doe v. Mnnninq, sup. Div. 619. 'A ^'iix ,, /Z i5"7 {It) Croker v. Martin, 1 Bl., N. (A), Doe V. Slanniiijj, 9 East, 59. S. 573; Dolphin v. Aiihcard, sup. (e) 27 EUz. c'. 4, s. 5. TAimiTY AS AGArPrST PrECHASEES. 55 as may be necessary to give effect to such subsequent transaction. A voluntary cestui que trust has no equity to the purchase-money as against the settlor («). This article is, however, subject to the proviso, that every such settlement is valid in the hands of purchasers for value and bona fide (A-), whether claiming as cestuis que trust under the settlement, or as purchasers from voluntary cestuis que trust, and whether with or without notice of the voluntary character of the settle- ment (/). Obs. — In this article, I have attempted to digest the effect of the decisions upon the Act 27 Eliz. c. 4, whereby all conveyances, &c. of land, tenements or hereditaments, made with the intent to defraud purchasers, and also all conveyances with any clause of revocation at the grantor's pleasure, are made void against subsequent purchasers. The principle upon which voluntary settlements have been held void under this act seems to be, that by selling the property afterwards for a valuable consideration, the vendor so entirely repudiates the former voluntary settlement, and shows his intention to sell, as that it shall be taken con- clusively against him and the person to whom he conveyed that such intention existed when he made the voluntary conveyance, and consequently that it was made in order to defeat the purchaser {m). This being the principle, the statute can only apply to voluntary conveyances, when the settlor and the subsequent vendor are the same person, and does not apply where the latter is the heir, or a second voluntary grantee of the former («); unless indeed the settlement was actually fraudulent (o). It has been repeatedly held that a very smaU. consideration (j) Dakin v. Whijmper, 26 B. (»») Per Campbell, C. J., Doo 568. V. Jim/mm, 17 Q.B. 723; 2lL. J., Ik) 27 Eliz. c. 4, s. i. Q. B. 139. h) Frodgers v. Langham, Keb. («) Ibid. ; and see Tarker v. 486; Sid. 133. Carter, 4 Ha. 409. (o) BurrelVs case, 6 Rep. 72. 66 DECLARED TETJSTS. is sufficient to take tlie case out of tMs statute {p) ; and in a recent case it was held, that the mere onus of performing covenants, attaching to the voluntary assignee of a lease, was a sufficient consideration {q). Idltjst. — 1. As an illustration of the principle, that the settlement is void so far only as is necessary to give effect to the subsequent transaction, the case of property sub- sequently mortgaged may be instanced. In such a case, the voluntary cestuis que trust will be entitled, subject to the mortgage ; and if unsettled estates are included in the mortgage, the cestuis que trust are entitled to throw the mortgage on to the unsettled estates, if they are sufficient to answer it {r). 2. The subsequent purchase for value, must be bona fide. Thus where the consideration is grossly inadequate, the sale may be impeached by the voluntary cestui que trust, on the ground that the transaction is on the face of it a collusive arrangement between the settlor and the-so-called purchaser, for the purpose of relieving the former from the settlement (s). [p) BagspooU v. Collins, L. E., (c) Sales y. Cox, 32 B. 118. 6 Ch. 228; Townend y. Taker, {s) DoeTr.Boutledge,Cow^.1Q5; L. R., 1 Ch. 446. Metcalfe v. Fulvcrtoft, 1 V. & B. {(j) Price V. Jenlcins, L. R., 5 184. Ch. DiT. 619. EXECXTTED ASD EXECUTORY TEUSTS. 57 SUB-DIVISION IV. CONSTEUCTION OF DeCLAEED TkUSTS. Art. 16. — Executed Trusts construed strictly, and Executory liberally. a. In the construction of executed trusts, technical terms are construed in their legal and technical sense («). /3. In the construction of executory trusts, the court is not confined to the language of the settlement itself ; and where the words of the settlement are improper or informal (i), or would create an illegal trust (c), or would otherwise defeat the iutention of the settlor as gathered from the motives which led to the settlement, and from its general ohject and purpose, or from other instruments to which it refers, or from any circumstances which may have influenced the settlor's mind {d), the court will not direct a conveyance according to the strict words of the settlement, but will order it to be made ia a proper and legal manner so as best may answer to the intent of the parties (c). Illust. — 1. If an estate is vested in trustees and their heirs, in trust for A. for life without impeachment of waste, with remainder to trustees to preserve contingent remainders, with remainder in trust for the heirs of A.'s body, the trust being an executed trust, A., according to the rule in Shelley's case, which is a rule of law and not [a) Wright v. Fearson, 1 Ed. (c) Sumberston v. Humberston, 125; Austen v. Taylor, ibid. 367; 1 P. W. 332. Srydges v. Brydges, 3 Vee. jun. {d) See per Lord Chelmsford 125; Jervoise t. Sulce of North- in Saokmlle West v. Solmesdale, umberland, IJ. & W. 571. L. E., i H. L. 543. (b) See Earl Stamford v. Sir [o) Earl Stamford v. Sir John John Sobart, 3 Br. P. C. Tail. Ilobart, sup.; and see Cogan v. ed. 31—33. Buffmld, L. R., 2 Ch. Div. ii./&i 58 BECLAEED TETJSTS. merely of construction, will be held to take an estate tail (/). Of course, where the doctrine could not apply in law, owing to the life estate being equitable, and the re- mainder legal, or vice versa, the rule will not apply in equity (^); nor where the word "heir" is used in the sense of persona designata(A), as where the ultimate limitation is " to the person who may then be the heir of A." 2. But in the leading case of Lord Glenorchy v. Bos- ville {i), where the settlor devised real estate to trustees upon trust, upon the happening of the marriage of his grand-daughter, to convey the estate to the use of her for life, with remainder to the use of her husband for life, with remainder to the issue of her body, with remainders over, it was held, that though the grand-daughter would have taken an estate tail had it been an executed trust, yet the trust, being executory, was to be executed in a more careful and accurate manner ; and that as the testator's intention was to provide for the children of the marriage, that intention would be best carried out by a conveyance to the grand-daughter for life, with remainder to her hus- band for life, with remainder to her first and other sons in tail, with remainder to her daughters. 3. And so in marriage articles, a covenant to settle estates to the use of the husband for life, with remainder to wife for life, with remainder to their heirs male, and the heirs of such male, is always construed to mean that the settlement shall be so drawn as to give life estates only, to the husband and wife successively {k) ; for it is not to be (/) Wright V. Pearson, 1 Ed. [k] Trevor t. Trevor, 1 P. "W. 119; Austen \. Tmjlor, ibid. i6l; 622; Streatfield ^. StreatfieU, 1 Jmes T. Morgan, 1 Bro. G. C. W.&T.L.C. 333; Jones ^.Lang- 206; Jervoise v. Bahe of North- ton, 1 Eq. C. Ab. 392; C'usack v. tmherland, 1 J. & "W. 559. Ctisack, 5 Bro. P. C. Tom. ed. 116 (g) Collier v. M'Bean, 34 Beav. Griffith v. Buckle, 2 Vem. 13 426. Stoner y. Curwen, 5 Sim. 268 (A) Greaves y. Simpson, WSxix., Bavies v. Savies, 4 Beav. 54 N. S. 609. Lambert v. Fcijton, 8 H. L. Cas. 1. ' (i) 1 W. &T., L. C. 1. EXECUTED AND EXECUTOEY TfiUSTS. 59 presumed that tlie parties meant to put it in the power of the husband to defeat the very object of the settlement, which is to make a provision for the issue of the mar- riage (l). 4. So where in marriage articles the word "issue" is tised, it win not be confined to male issue, because that would be inconsistent with the object of the articles, but will be construed to mean sons successively in tail, with remainder to daughters in tail, with cross remainders over (to). 5. But where the articles show that the parties under- stood the distinction, as, for instance, where part of the property is hmited in strict settlement, and part not, the trust will be construed strictly (m). 6. In a will it is obvious that the same presumption will not arise as in the case of marriage articles; and, therefore, where a testator gave 300^. to trustees, upon trust to lay it out in the purchase of lands, and to settle such lands to the only use of M. and her children, and if M. died without issue, "the land to be divided between her brothers and sisters then Kving," it was held that this gave M. an estate tail(o). 7. There is, however, no difference between the con- struction to be put on an executory trust created by mar- riage articles, and on an executory trust created by will, except so far as the former by its very nature furnishes more emphatically the means of ascertaining the intention of those who created the trust (js). In Sackville West v. (I) SneU, 50. («) Sowel v. Howel, 2 Ves. 358; (m) Nandick v. Wilkes, Gil. Eq. Powel v. Price, 2 P. W. 535 ; Eep. 114; Burton v. Hastings, Chambers'^. Chambers, 2'E,(i.G.Ab. ibid. 113; Sart v. Middlehurst, 35, o. 4 ; Sighivay v. Banner, 1 3 Atk. 371; Maguire v. ScuUi/, 2 Bro. C. 0. 584. Hy. 113; Burnabg v. Griffin, 3 (o) Stveetapple y. Bindon, 2'VeT. Ves. 206; Some t. Barton, 19 536. Ves. 398; Phillips v. James, 2D. (p) Sackville West v. Solmes- & Sm. 404 ; Be Daniel, L. E., 1 dale, L. K., 4 H. L. 543. Cli. Div. S76./S%^Jt-/tfif 60 DECLAEED TETJSTS. Viscount Holmesdale, Lady A., by a codicil to her will, revoked certain uses declared therein, and declared hei intentions to be, to give certain real and personal property to trustees, in trust to settle it as near as might be, with the limitations of the barony of Buckhurst, in such manner as the trustees should consider proper, or as their counse] should advise. The barony was Hmited to Lady De la Warr for hfe, with remainder to E., her second son, and the heirs male of his body, with remainder to the third, fourth, and other sons in Hke manner. It was held, thai the property ought not to be settled upon E. in tail like the barony, but that it ought to be limited in a course oi strict settlement to E. and other yoimger sons of Lady De la Warr for their respective Uves, with remainder to theii sons successively in tail male, in the order mentioned in the patent whereby the barony was created ; and Lord Chelms- ford said : "The best illustration of the object and purpose of an instrument furnisMng an intention in the case of exe- cutory trusts, is to be found in the instance of marriage articles, where, the object of the settlement being to mak( a provision for the issue of the marriage, no words, how- ever strong, which in the case of an executed trust woidc place the issue in the power of the father, will be allowed to prevail against the implied intention. So, as Sir W Grant said, in Blackburn v. Stables (§■), 'in the case of a will if it can be clearly ascertained from anything in the wil that the testator did not mean to use the expressions whicl he has employed in their strict technical sense, the court in decreeing such settlement as he has directed, will depar from his words to execute his intention.' . . . There ar( cases of executory trusts in wills, where the words ' heiri of the body' have been made to bend to indications of in tention that the estate should be strictly settled; and f direction in a will, that a settlement ' shall be made a (j) 2 V. & B. 369. EXECUTED A2m EXECUTOET TEUSTS. 61 counsel shall advise,' has been held sufficient to show that the words were not intended to have their strict legal effect (>•). ... It appears to me that the words of the codicil express an intention that the barony and the estates should go together to the same person, but not that the limitations of the two should be identical. . . . The word 'correspond' does not mean that the limitations are to be exactly the same, but that they are to be adapted to each other so as to carry out the testatrix's intention that the estate and title should go together. ... If the settlement were framed with a limitation in the words of the letters patent, Lord Bucthurst would be able to defeat this inten- tion, and, by converting his estate taO. into a fee simple, to separate the estate and the title for ever." 8. So again, where a testator bequeathed money to trustees upon trust to purchase real estate, and settle it upon A. for life without impeachment of loaste, with remainder to trustees to preserve contingent remainders, with remainder to the heirs of A.'s body, and with a power to jointure, and also devised land to A. upon exactly Similar uses, it was held, that the testator manifested an intention to give A. a life estate only, and that conse- quently in the case of the executory trusts this intention should be carried out ; but that in the case of the devise, that being executed, must be construed according to the rule in Shelley's case (s). "Where there was a devise to a corporation in trust to convey to A. for life, and afterwards upon the death of A. to his first son for life, and so to the first son of that first son for life, with rematader in default of issue male of A. to B. for life, and to his sons and their sons in like manner. Lord Cowper said, that though the attempt to create a perpetuity was vain, yet, so far as was consistent with the rules of law, the devise ought to be complied with; and he directed, that Ir) Bastard v. Frohu, 2 Cox, 6. U) Fapillon v. Voice, 2 P. "W. 571. 62 DECLABED TBTJSTS. all the sons already born at the testator's death shouli take estates for life, -with limitations to their unborn son in tail {(). 9. As a last illustration may be quoted the recent casi of Willis V. Kymer (m). There a testatrix had by her will after requesting her sister Eliza to perform her -wishes ai therein expressed, bequeathed various legacies to he: brothers and sisters and their children, iacluding a legaci of 3,000;. to her brother John for life, "the principal to bi divided at his death between his children John, Sophia and Mary Ann." The testatrix subsequently made i codicil, whereby she bequeathed to Eliza, " all I possess,' requesting at her death she " will leave the sums as I havf directed heretofore." Eliza, by her will, appoiated th( shares of Sophia and Mary Ann to them to their separate use, and the question then arose whether she could do so and Sir George Jessel, M. E., said, "I am of opLoion thai EHza had power to attach a limitation to separate use . . . The original will and codicil say nothing aboui separate use. They merely direct her to leave the monej after her brother's death to his children, and nothing more. She is therefore bound not to make a diilerenl disposition. "Well, she has conformed to that direction, \ij leaving the money to the children; and in doing so has taken care to dispose of it in such a manner that the shares of the daughters shall, in case of their marriage, still remain for their own benefit, thus effectually carrying out her sister's intention." (t) Sumberston v. Snmherston, 15Beav. 173; hatseeBlagroveY. 1 P. W. 332 ; Williams v. Teale, SandcocJc, 18 Sim. 378. 6 Ha. 239; Lyddon t. Ellison, 17 (m) L. E., 7 Ch. Div. 181. Beav. 565; Peard v. Kelcewich, 'Xi'vi.^^ /< ^a-y^ ( 63 ) Division II. CONSTRUCTIVE TRUSTS. Abt. 17. Introductory Summary. 18. Mesulting Trusts of undisposed Sesidue. 19. Mesulting Trusts where declared Trust illegal. 20. Sesulting Trusts where Purchase in another^s Name. 21. Profits made by fiduciary Persons. 22. Equitable and legal Estates not wiited in one Person. Art. 17 .—Introductory Summari/. Constructive trusts arise, either (1) when the legal estate is given but the equitable interest is not, or is only partially disposed of; (2) when the equitable interest is disposed of in a manner which the law wiU not permit to be carried out ; (3) when a purchase has been made in the name of some other person than the real purchaser (in each of which three cases the equit- able interest may return, or, as it is technically called, " result " to the settlor or purchaser) ; (4) when some person holding a fiduciary position has made a profit out of the trust property; and (5) in aU other cases where there is no express trust, but the legal and equitable estates in property are nevertheless not co- equal and united in the same individual. Art. 18. — Resulting Trust ivhere Equitabk Interest not wholly disposed of. When property is given to a person, and it is either expressed on the face of the instrument by which it was given, or, in the absence of such expression, it appears to have been the probable intention of the donor, extracted from the general scope of the instrument {a), that the donee was {a) Per Lord Hardwicke, Bill Walton v. Walton, 14 V. 322; King ■ V. Bishop of London, 1 Atk. 620 ; v. Denison, 1 V. & B. 279. 64 CONSTETTCTIVE TEUSTS. not intended to take it beneficially, but the instru- ment is eitlier silent as to the way in which the beneficial interest is to be applied, or directs that it shall be applied for a particular purpose (as dis- tinguished from a mere subjection ^o such pur- pose (b) ), which purpose turns out to be insufficient to exhaust the property or cannot be carried into effect (c), there will be a resultiug trust in favour of the donor or his representatives {d). Where the non-benefioial character of the gift appears on the face of the instrument, no evidence to the contrary- is admissible {e) ; but where it is merely presumed from the general scope of the instrument, parol evidence is (at all events in the case of gifts inter vivos) admissible, both in aid and in contradiction of the presumption (/). Illttst. — 1. Thus, where real estate was devised to "my trustees," but no trusts were declared in relation to it, it was held that the trustees must hold it in trust for the testator's heir; for by the expression "trustees," unex- plained by anything else in the instrument {g), all notion of a beneficial interest in the gift to those individuals was excluded (A). 2. And so where a testator devised and bequeathed all (S) See 1 Jann. 533; Waism v. Bocksey, 2 Eq. C. A. 606 ; North Hayes, 5 M. & C. 125; WoocIy. Y.Oromptm,\Gh..Ga.\9&; Walton Cox, 2 M. & C. 684. T. Walton, 14 V. 322 ; Zangham (c) Stiibbs v. Sargou, 3 M. & C. v. Sandford, siip.; Lynn v. Heaver, 507 ; Ackmjd t. Smithson, IB. 1 T. & R. 66 ; and Le-wia, 52 C. C. 503. etseq., and 130; and see Siddulph (d) As to whether it results to v. Williams, L. E., 1 Ch. Div. Hs residuary deTisees, legatees, 203. IftJ^ /i ^f'/- or real or personal representa- (17) As, for instance, if the es- tives, see Le-win, 182 et seq. pression is used with reference to (e) See Langham v. Sandford, one only of two sepai-ate funds. 17 V. 442; Irvine v. Sullivan, Mateley v. Wiudle, 2 B. C. C. 31; L. B., 8 Eq. 673. Fratt v. Sladden, 14 V. 193; G'Ms (/) 29 Car. II. c. 3, s. 8. v. £umsey, ZV. k'B.iM. Gascoigne v. Timing, 1 Ver. 366 ; (/j) Dawson v. Chr/.; 18 V. Willis T. Willis, 2 Att. 71 ; Cook 254 ; Barrs v. JFewke, 2 H. & M. v. Hutchinson, 1 Ke. 60. As to 60; and see Elcock \. Mapp, 3 parol evidence explanatory of a H. L. Gas. 492. testator'' s intention, see Docksey y. TJOTDISPOSED OF EESIBUE. 65 Ms estate and effects to A. and B., tlieir heirs, executors, and administrators, upon trust to convert Ms personal estate, and to stand possessed of tlie proceeds and of the residue of his estate and effects, upon trusts only applicable to personalty, it was held that the real estate of the testator passed to the trustees by the use of the word " devise" in the gift, and the word "heirs" in the limitation; but that as the trusts were rigidly and exclusively applicable to personal property, and as the trustees had been designated by that name, and so could not take beneficially, there was a resulting trust of the real estate in favour of the settlor's heirs («"). 3. Where lands have been conveyed to a trustee, and the trusts have not been manifested and proved by a signed writing in accordance with the Statute of Frauds, there will be a resulting trust to the settlor (/). 4. So, if a declared trust is too uncertain or vague to be executed (/c), or fails by lapse (1) or otherwise, then as it is expressed on the face of the instrument, that the trustee was not intended to take beneficially, there will be a result- ing trust. 5. Where real property is granted to another, either without any consideration at aU, or for a merely nominal one (m), then if no trust is declared of any part of it, and the grant is to a stranger, and no intention of passing the beneficial interest appears, either by the instrument or by parol or other evidence (»), the law presumes that the prob- (i) loughley v. LoughUy, L. E., Granger, 5 B. 300. 13 Eq. 133; Dunnage t. White, 1 (I) Ackroyd v. Smithson, 1 B. J. & W. 583; Lloyd T. Lloyd, C. C. 503; Spink v. Lewis, 3 B. L. E., 7 Eg. 458; comp. JD'Al- C. C.-355; or becomes in the event maine v. Moseley, 1 Dr. 629; Coard too remote, Tregonwell v. Syden- T. Soldemess, 20 B. 147. ham, 3 Dow, 210. (/) Sudlcin T. Dolman, 35 L. T. (m) Mayes v. ICmgdome, 1 Ver. 791. 33; Sculthorpe v. Burgess, 1 V. (k) Stubhs V. Sargoti, 2 Ke. 255 ; jun. 92. MoriceY. Bishop of Durham, QY. in) Cook v. Hutchinson, 1 Ke. 399, and 10 V. 522; Kendal t. 60. 66 CONSTETJCXIVE TEUSTS. able intention of tlie grantor was not to confer a benefit [o] and accordingly looks upon tbe grantee as a trustee for th grantor or his representatives. 6. But wliere tlie gift is of chattels, it would seem tha an intention to confer beneficially would be presumed, oi the ground of the utter fatuity of the proceeding on anj other supposition (p). But this presumption is, of course rebuttable by evidence (q). 7. Where there is a devise to A. upon trust to pay debts or to answer an annuity, there is a resulting trust of whai remains, after payment of the debts or satisfaction of the annuity (>•). 8. But where (s) one made his will, and thereby gam 51. to his brother (who was also his heir-at-law), and made and constituted his "dearly beloved wife" his "sole heiress and executrix" of all his lands and real and personal estate, to sell and dispose thereof at her pleasure, and to pay Me debts and legacies, it was held, that the wife was entitled to the real estate for her own benefit, and that there was no resulting trust to the heir, on the ground that the direc- tion that the vnfe should be sole heiress, did in every respect place her in the stead of the heir-at-law and not as trustee for him, and that this was "rendered plainer by reason of the language of tenderness and afEection which m.ust intend to her something beneficial, and not what would be a trouble only;" in addition to which the heir was not forgotten, but had 51. left him. 9. And so under a devise to A., charged with the pay- ment of debts and legacies (<), or charged with the payment of a contingent legacy («) which does not take effect, there (o) Sculthorpe v. Burgess, sup.; B. 279; Watson -7. Hayes, sup. aiidseei&*cA«Ksv. Z«e, 1 At. 447. (s) Eogers v. Sogers, 3 P. W. (p) George v. Howard, 7 Pr. 193. ^51. (*) King v. Dennison, sup.}- (y) Custance v. Cunninghame, 13 Wood v. Cox, sup. B. 363. (m) Tregomcell v. Sydenham, 3 (r) King v. Dennison, 1 V. & Dow, 210. "WHEBE DECLAEED TRUST ILLEGAL. 67 will be no resulting trust, but the whole property will go to the devisee beneficially, subject only to the charge. Aet. 19. — Resulting Trusts where Trusts declared are Illegal. Wben a person has intentionally vested property in another for an illegal purpose, then if the trustee expressly relies {a) upon the maxim "In imri delicto potior est conditio ^Mssideiitis," the settlor cannot recover it back (b), except in the following cases, namely, — a. Where the illegal purpose is not carried into execution and nothing is done under it, there is a locus poenitentiee, and the mere intention to effect an illegal object will not deprive the settlor of the right to the beneficial ownership, to which the trustee has no honest claim; and there will conse- quently be a resulting trust in favour of the settlor (c). /3. "Where the effect of allowing the trustee to retain the property might be to effectuate an un- lawful object, or to defeat a legal prohibition, or to protect a fraud, equity will, on the ground of public policy, enforce a resulting trust in favour of the settlor, so as to prevent the illegal trust being carried into effect (d). (a) Saigk v. Kaye, L. R., 7 [d) See per Lord Seltorue in Ch. 469. * ^^ ^ ^^^- Ayerst v. Jenkins, L. K., 16 Eq. (i) Duke of Bedford v. Coke, 2 283 j.,aiid see per Knight Bruce,; V. sen. 116; Curtis v. Perry, 6 L. J., in SeyneU T7~Spry, where V. 739; Cottington v. Fletcher, 2 he said, "Where the parties are At. 156; Brackenbiiry Y. Bracken- not in pari delioto, and where bary, 2 J. & W. 391; Taylor v. public policy is considered as ad- Chester, L. E. , 4 Q. B. 309 ; Ayerst vanoed by allowing either party, V. Jenkins, L. R., 16 Eq. 27^1 or at least the more excusable of [e) Symes v. Sughes, L. Rl, 9 the two, to sue for relief, relief is Eq. 475; Childers v. ChilderA 1 given to him." And see also to D. & J. 482; Davies v. Otty,]S5 same effect, Zato v. Zaio, 3 P. W. B. 208; Birch v. Blagrave, Airib. 393, and St. John v. St. John, 11 264 ; Flatamone T. Staple, G-. Coot). V. 535. 250. 68 COMTKTJCTIVE TETTSTS. Illttst. — 1. Thus ia Symes v. Hughes {e), the plaintiff, being in pecuniary difficulties, assigned certain leasehold property to a trustee with the view of defeating Ms creditors, and two and a half years afterwards was adjudi- cated bankrupt, but obtained the sanction of his creditors, under sect. 110 of the Bankruptcy Act, 1861, to an arrange- ment, by which his estate and effects were re-vested in him, he covenanting to prosecute a suit for the recovery of the assigned property, and to pay a composition of two and sixpence in the pound to his creditors, in case his suit should prove successful. Lord EomiUy, M. E., in deliver- ing judgment, said : " The assignment was made for an illegal purpose, and it is said that, such being the case, the court will not interfere. I think the correct answer to this was given by Mr. Southgate, namely, that where the purpose for which the assignment was given is not carried into execution, and nothing is done under it, the mere in- tention to effect an illegal object when the assignment was executed, does not deprive the assignor of his right to recover the property from the assignee who has given no consideration for it." 2. So, again, the plaintiff, being apprehensive of an. indictment for bigamy (conviction for which involved for- feiture of property), conveyed his real estate to the defen- dant, on a parol agreement to retransf er when the difficulty should have passed over. It subsequently transpired that the plaintiff was not liable to be indicted, and thereupon he filed a biU. praying for a retransf er of his property; and it was held, that although there was no express trust, inasmuch as there was no written proof of it, yet there was a resulting trust to which the statute did not apply, and as there was no ilLegality in fact, but only in inten- tion, the coiu't ordered the transfer prayed for (_/). 3. And where a father conveyed the legal estate in pro- («) Supra. (/) BaviesY. Otti/, mp. ■WHERE DECIiABED TETJST ILLEGAL. 69 perty to his daughter, with the intention of thus escaping from serving as sheriff, but afterwards repented, and paid the fine, Lord Hardwicke said, "I am of opinion that the conveyance ought not to take effect against his intention unless he had actually taken the oath" that he had not the recLuisite qualification (y). 4. Where a settlor attempts to settle property so as to contravene the policy of the law with regard to per- petuities, such trusts will not only not be carried into effect, but the person nominated to carry them out is held to be a mere trustee for the settlor or his representatives. For the attempt was made either through ignorance or carelessness, or else with a direct intention to contravene the law. In the former case, as there would be no delictum, the usual maxim would not apply. In the latter, equity would not allow the trustee to retain the property and so put it in his power to carry out the illegal intentions of the testator, and to defeat the poHcy of the law (A). 5. And so again, where land or the proceeds of land is devised to charitable uses, or is devised to one who is under a secret agreement with the testator pledged to apply it to charitable purposes, then, notwithstanding the improper intentions of the testator, yet, as the object of allowing the gift to stand would probably be to effect an object prohibited by law, there will be a resulting trust in favour of the testator's heir-at-law or residuary devisee, as the case may be (2). 6. But where a father granted land to his son, in order to give him a colourable qualification to shoot game under the old game laws, and without any intention of conferring any beneficial interest upon him, the court would not enforce any resulting trust in favour of the father, on the [g) Birch TT. Blagrave, sup. {%) ArnoldY. Chapman, lY. sen. (A) CarrickY.Emngton,27.yT. 108; Addlitigton \. Cann, Bam. 361; Tregonwell \. Sydenham, 3 130; Springett-v. Jennings, li.'R., Dow, 194; Gibbs t. Sumsei/, 2 10 Eq. 488 ; but see Roicbotham V. & B. 294. T. Dimnett, L. R., 8 Ch. Div. 430.: 70 CONSTEUCTIVE TETTSTS. groimd probably, that he and the son were in pari delicto, and that there would be no detriment to the public in allowing the son to retain the estate (k). Of course, if there had been no illegality (if, for instance, a bare legal estate had been a sufficient qualification), there would have been a resulting trust (/). 7. So in Ayerst v. Jenkins (m), a widower, two days before going through the ceremony of marriage with his deceased wife's sister (which ceremony was known to both parties to be invalid), executed a deed, by which it was recited that he was desirous of making a settlement and provision for the lady, and had transferred certaia shares into the names of trustees, upon the trusts thereinafter declared, being for the separate and inalienable use of the lady during her life, and after her death as she should by deed or wiU appoint. They afterwards lived together as man and wife imtU the widower's death. Some time after- wards, his personal representative instituted a suit to set aside the settlement, on the ground that it was founded on an immoral consideration; but LordSelborne said, "Belief is sought by the representative, not merely of a particeps crimiois, but of a voluntary and sole donor, on the naked ground of the illegality of his own intention and purpose, and that, not against a bond or covenant or other obliga- tion resting in fieri, but against a completed transfer of specific chattels, by which the legal estate in those chattels was absolutely vested in trustees for the sole benefit of the defendant. I know of no doctrine of public policy which requires or authorizes a com-t of equity to give assistance to such a plaintiff under such circumstances. When the immediate and direct effect of an estoppel in equity against relief to a particular plaintiff might be to effectuate an un- lawful object, or to defeat a legal prohibition, or to protect a (k) Braclcenhuri/Y.Brackenhiry, 11) Childcrs v. CMlders, 1 D. & 2J. &W. 391. J. 482. [m) L. R., 16 Eq. 283.^^'"^ praacHASES IN anothbe's name. 71 fraud, such an estoppel may well be regarded as against public policy. But the voluntary gift of part of his own property by one particeps criminis to another, is in itseH neither fraudulent nor prohibited by law; and the present is not the case of a man repenting of an immoral purpose before it is too late, and seeking to recall, while the object is yet unaccomplished (ra), a gift intended as a bribe to iniquity. If pubUc poUcy is opposed, as it is, to vice and immorality, it is no less true, as was said by Lord Truro in Benyon v. Nettlefold{o), that the law ia sanctioning the defence of particeps criminis does so on the grounds of public policy, — namely, that those who violate the law must not apply to the law for protection." Art. 20. — Resulting Trusts upon Purchases in Another's Name. When real (a) or personal (5) property is taken in the names of the purchaser and others generally, or in the names of others without that of the purchaser, or in one name, or in several, and whether jointly or successively, there is a prima facie presumption of a resulting trust in favour of the man or men who, by parol (c) or other evidence, is or are proved to have advanced the purchase-money {d) in the character of purchaser (oy,'L. K., 15 Eq. 55. [o) SeeperLordLougtborougl (m) Reddington v. Seddington, 3 3 Ridge, 190. Eidge, 197. {p) Gan-ett v. ffilkinson, 21). > (n) Sidmoutli v. Sidmouth, 2 B. S. 244. 455; E:epworthT.Sepworth,'L.:R., (?) 2 De &., J. & S. 17. PTJUCHASES IN ANOTHEe's NAME. 75 great respect, it is submitted that the true ground for presuming that a parent intends to advance his child, is not duty, but natural love and affection. On this point, the judgment of Yice-ChanceUor Stuart in Sayre v. Hughes {r) is worthy of study. In that case, a "widowed mother, after making her will in favour of her two daughters, transferred East India Stock which had stood in her own name into the names of herself and the unmarried daughter, and died: and the Vice-Chancellor said, "If stock be found standing in the names of two persons, the presumption of law is that it is their pro- perty. But if there be evidence that one of them pur- chased the stock, and that the name of the other was used without any consideration proceeding from that person, the want of consideration induces the court to presume a resulting trust. The more simple case, and that generally referred to in the reported decisions, is the case of a purchase by one person in the name of another. As soon as you have the fact of the purchase in evidence, and show that the purchase-money was paid by a person other than the person to whom the conveyance was made, the fact of want of consideration almost necessarily creates the pre- sumption of a resulting trust. In the case, however, of a father purchasing property in the name of a son, and having the conveyance made to the son — the father paying the purchase-money — the circumstance of a relationship raises a presumption of benefit intended for the son, which rebuts the notion of a resulting trust. In the case of Grey v. Grey (s), before Lord Nottingham, there was, beyond the simple facts of the purchase and the convey- ance, the fact of the receipt of the profits by the father. Where the conveyance is to one person and the purchase- money paid by another, the receipt of the profits by the person who paid the purchase-money, in an ordinary case strengthens the presumption that he is the beneficial (r) L. R., 5 Eq. 376. {s) 2 Sw. 594. 76 cos-STEtrcirra tkusts. o-wner, but in the case of a father and a son this eireum.- stance was not enough to rebut the presumption of benefit to the son. The same doctrine extends to a purchase by a person in loco parentis. Lord Cottenham in Powys v. Mansfield {f), commenting upon the meaning of that ex- pression, said, 'It means a person in such a relation towards the individual in question as raises a presumption of an intention to benefit him..' It has been argued, that a mother is not a person bound to make an advancement to her child, and that a widowed mother is not a person standing in such a relation to her child as to raise a presumption that in a transaction of this kind a benefit was intended for the child. In the case of Re De Visme it was said, that a mother does not stand in such a relationship to a cluld as to raise a presumption of benefit for the child. The question in that case arose on a peti- tion in lunacy, and it seems to have been taken for granted that no presumption of benefit arises in the case of a mother. But maternal affection as a motive of bounty is perhaps the strongest of all, although the duty is not so strong as in the case of a father, inasmuch as it is the duty of a father to advance his child. That, however, is a moral obligation, and not a legal one." His honor then reviewed the circumstances of the case, in order to see whether they rebutted the presumption of advancement, and, finding that they did not, decided in favour of the daughter. 8. With regard to the presumption of advancement in favour of persons to whom the purchaser stands in loco parentis, it has been held that the presumption arose in the case of an illegitimate child (?«), a grandchild when the father was dead (v), and the nephew of a wife who had been practically adopted by the husband as liis child (jy). (t) 3 M. & C. 359. (v) EbrandY. Dancer, Ch. Ca. 26. (u) Beckford v. Heekford, Loft, («») Currant t. Jago, 1 Coil. Ch. 290. 261. PROFITS MADE BY PrDUCIABT PERSONS. 77 But it wotild seem that the person alleged to have been in loco parentis must have intended to put himself in the situation of the person described as the natural father of the child vdth reference to those parental offices and duties which consist in making provision for a child ; and the mere fact that a grandfather took care of his daughter's illegitimate child and sent it to school, has been held to be insufficient to raise the presumption; Vice-Chancellor Page Wood saying, "I cannot put the doctrine so high as to hold that if a person educate a child to -whom he is under no obligation either morally or legally, the child is there- fore to be provided for at his expense" {x). Aet. 21. — Profits made hy Persons in Fiduciary Positions. Where a person holds, or has the management o£ property, either as an express trustee, or as one of a succession of persons partially interested under a settlement, or as a guardian, agent, or other person clothed with a fiduciary character, he must not gain any personal profit by availing himself of his position ; and if he does so, he will be a mere trustee of such profit for the benefit of the persons equitably entitled to the property, in respect of which such profit was gained. Illust. — 1. Thus, in the leading case of Sandford v. Keecli {a), a lessee of the profits of a market had devised the lease to a trustee for an infant. On the expiration of the lease, the trustee applied for a renewal, but the lessor would not renew, on the ground that the infant could not enter into the usual covenants. Upon this, the trustee took a lease to himself for his own benefit; but it was decreed by Lord King, that he must hold it in trust for the infant, his lordship saying, " If a trustee, on the refusal (x) TucTcer v. Burron, 2 H. & [a) Sel. Ch. Ca. 61. M. 515; llJur., N. S. 525. 78 CONSTEUCTIVB TKIJSTS. to renew, miglit have a lease to himself, few trust estates would be renewed to cestuis que trust." 2. And so also a tenant for life of leaseholds (even though they be held under a mere yearly tenancy (5) ), who claims under a settlement, cannot renew them for his own sole benefit; for he cannot avail him self of his position, as the person in possession under the settlement, to get a more durable term, and so to defeat the probable intentions of the settlor, that the lease should be renewed for the benefit of all persons claiming under the settlement (c). And upon similar grounds, if a tenant for life accepts money in con- sideration of his allowing something to be done which is prejudicial to the trust property (as for instance the unopposed passage of an act of parliament sanctioning a railway), he will be a trustee of such money for aU. the persons interested under the settlement {cT). 3. The same principle applies to mortgagees (e), joint tenants (/), partners {g), and owners of land subject to a charge {h). 4. So directors of a company, cannot avaU themselves of their position to enter into beneficial contracts with the company {i)\ nor can they buy property, and then sell it to the company at an advanced price. So promoters of a company hold a fiduciary relation towards the company (/!;). Directors cannot receive commissions from other parties, (b) James v. Beatw, 15 V. 236 Ch. Dir. 3i5. •^ Sic^ A (c) Eyre v. Dolphin, 2 B. & B. (/») Jackson v. Welsh, L. & G. 290; Mill v. Hill, 3 H. L. C. t. Plunket, 346 ; Winslowy. Tighe, 828; Tew v. Edwards, 1 D. & J. 2 B. & B. 195; Webb v. Lvgar, 2 598; James -y. Deane, sup. Y. Sc C. 247. {d) Pole V. Fole, 2 Dr. & S. (i) Great Luxemiourg Sail. Co. 420. V. Magnaij, 25 B. 586; Aberdeen («) Rushworth's case, Free. 13. Sail. Co. t. Blackie, 1 Maeq. 461; (/) Palmer v. Young, 1 Ver. Flanagan v. G. W. Rail. Co., 19 276. L. T., N. S. 345. (^) FeatherstonhaughY.Fenwick, [k) Kitchens v. Congreve, 1 R. 17 V. 311; Clegg v. Fishwick, 1 AM. 150; Fawcett v. Whitelwme, M. cfe Gr. 294; Bell v. JSarnett, 21 ibid. 132; Beck v. Kantorowicz, 3 W. E,. 119; but ae to partners, K. & J. 230; Bagnall v. Carlton, , see Bean v. MacDowell, L. R., 8 L. R., 6 Ch. Div. 371.2.2 iu^ K-JoZ GENERAI, EQUITIES. 79 on the sale of any of the property of the company {l), and generally they cannot deal for their own advantage with any part of the property or shares of the company {m). 5. Agents come under the same ' principle («). Thus, where A., being aware that B. wished to obtain shares in a certain company, represented to B. that he. A., could procure a certain number of shares at SI. a share, and B. agreed to purchase at that price, and the agreement was carried out; but B; afterwards discovered that A. was in fact the owner of the shares, having just previously bought them for 21. a, share; it was held that A. was an agent for B., and must be ordered to repay to B. the difference between the price given by B., and that given by A. for the shares (o). 6. So a solicitor who purchases property from a client, must, if the sale be impeached, not only show that he .gave full value for it, but also that the client was actually benefited by the transaction. And persons who subse- quently purchase from the soHcitor with notice of the transaction are under a similar liability (p). Art. 22. — General Equitable Claims. In every case (not eoming within the scope of any of the preceding articles) where the person in whom real or personal property is vested, has not the whole equitable interest therein, he is pro tanto a trustee for the persons having such other equitable interest {a). [l) Gaskell v. Chambers, 26 B. {a) This article, doubtless, in- 350. eludes all those relatiag to oou- (m) TorJc, %c. Co. v. Hudson, structive trusts wMoli have pre- 16 B. 485. ceded it, but as it would be a in) Morrett v. Faske, 2 At. 54 ; quite endless task to enumerate Kimber v. Barber, L. E., 8 Oh. every kind of constructive trust, 66. 4^ ^^^-'i ^ 'JS'J^ for they are, as has been truly (o) Kimber v. Sarber, sup. said, conterminous -with equity (p) Topham v. Spencer, 2 Jur., Jurisprudence, I have thought N. S. 865. it better to call special attention 80 CONSTEIJOTIVE TETJSTS. Illust. — 1. Thus, wliere a binding contract is entered into between two persons for the sale of property by one to the other, then, in the words of Lord Cairns, in Shaw v. Foster {I), "There cannot be the slightest doubt of the relation subsisting in the eye of a court of ec[uity between the vendor and the purchaser. The vendor is a trustee of the property for the purchaser ; the purchaser is the real beneficial owner in the eye of a court of equity of the pro- perty, subject only to this observation, that the vendor (whom I have called a trustee) is not a mere dormant trustee ; he is a trustee having a personal and substantial interest in the property, a right to protect that interest, and an active right to assert that interest if anything should be done in derogation of it. The relation therefore of trustee and cestui que trust subsists, but subsists subject to the paramount right of the vendor and trustee to protect his own interest as vendor of the property." He is, how- ever, only trustee pro tanto, and his duties are strictly matter of contract (c). 2. In the converse case, where the vendor has actually conveyed the property, but the purchaser has not paid the purchase-money, or has only paid part of it, the vendor has a lien upon the property for the unpaid portion {d) ; and the purchaser will hold the estate as a trustee pro tanto, unless by his acts or declarations the vendor has plainly manifested his intention to rely, not upon the estate, but upon some other security, or upon the personal credit of the individual (e). A mere collateral security will not, however, suffice (/) ; but where it appears that a bond, covenant, mortgage or annuity was itself the actual con- to those classes which are most Knox v. Gije, L. E., 5 H. L. 656; important, and to bring all others hut see Smith v. JSarl Egmont, withia one sweepiag general L. E., 6 Ch. Div. 469.^Jti^/?/i- clan^e. {d) Mackreth v. Smnmons, 1 (5) L. K., 5 H. L. 338; Earl Lead. Ca. 295. of JEpnont v. Smith, L. B. , 6 Ch. le) Ibid. Div. 475. o2 3 £.^ /^ fg If) Collins v. Collins, 31 B. 346 ; («) See per Lord westhury in Sughes -^.Kearney, 1 Sch. & L. 134. GENEEAL EQUITIES. 81 sideration — the tHng bargained for — and not a mere col- lateral seouxity f or the purchase-money (y), there mU be no lien, and consequently no trust. 3. It need scarcely be pointed out that a mortgagor, in the case of an equitable mortgage, is pro tanto a trustee for the mortgagee ; for even -where there is no written memorandum, a deposit of title deeds is of itself evidence of an agreement for the mortgage of the property (Ji) ; and in accordance with the maxim, that equity regards that as done which ought to be done, the mortgagor holds the legal estate in trust to execute a legal mortgage to the mortgagee. 4. Upon the death of a mortgagee, the mortgaged property (if assured to him in fee) descended at law, previous to the Vendor and Purchaser Act 1874, to his heir ; but being in reality only a security for money, it equitably belonged to his personal representatives, and the heir was, therefore, held to be a trustee only for the administrators or executors of the mortgagee («'). 5. So a mortgagee in possession is constructively a trustee of the rents and profits, and bound to apply them in a due course of administration {h). But there has been considerable conflict of opinion as to the extent of his re- sponsibility. For instance, it has been held that he is liable, even after transferring the mortgage without the mortgagor's consent (^); but this decision has been ques- (g) 1 Lead. Ca. 317; Buoldand M parte Moss, 3 D. & S. 599. V. PoclcnelljlZ Sim. 499; Farrott («) Thornborough v. Baher, 2 v. Sweetland, 3 M. & K. 655; Lead. Ca. 1030. But see 37 & Dixon T. Gayfere, 21 B. 118; 38 Vict. .;. 78, ss. 4, 5. Dyke v. Zendali, 2 D. M. & Gr. (i) Lew. 169; CoppringY. Cooke, 209 ; and see lie Brentwood Brick 1 Ver. 270 ; Bentham v. Saincourt, and Coal Co., L. B., 4 Ct. Div. Pr. Ch. 30; Parker v. Calcraft, 6- 562. .2-^ ^1-^ ^7^^- Mad. 11; SughesY. Williams, 12 (A) iJ«ss(!Bv.iJ«ss«Z^, 1 Lead. Ca. V. 493; Maddocks v. Wren, 2. 674; Ex parte Wright, 19 V. 258; Ch. Hep. 109. Fryce v. Bury, 2 Dr. 42 ; Ferris (J) Venables v. Foyle, 1 Ch. Ca. T. Miillins, 2 Sm. & Gif. 378; 3. T7.T. G 82 CONSTETJCTIVE TRUSTS. tioned, and, it is respectfully appreliended, rightly so {m). In another case, it was said that a mortgagee in posses- sion who, after the mortgagor's death, bought up the widow's right to dower, was obliged to hold it in trust for the heir, upon his paying the purchase-money (w) ; and although this case has called forth much comment (o), it is difficult to distinguish it in principle from the class of cases treated of in the last article. 6. Upon similar principles, a court of equity converts a party who has obtained property by &aud "into a trustee for the party who is injured by that fraud ; but that, being a jurisdiction founded on personal fraud, it is incumbent on the court to see that a fraud, or malus animus, is proved by the clearest and most indisputable evidence; it is im- possible to supply presumption in the place of proof" (j>). ()«) Le"w. 169; and consider Arnold v. Garner, 2 Ph. 231; Mingham v. Lee, 15 Sim. 400. Mathison v. Clarice, 3 Dr. 3. (n) Baldwin v. Bannister, cited [p) Per Lord Westbury in in Sobinson v. Pett, 3 P. "W. 251. McCormick v. Grogan, L. R., 4 (o) Dobson V. Land, 8 Ha. 330; H. L. 88. ( 83 ) Division III. THE ADMINISTRATION OF A TRUST. SUB-DIV. I. PEELIMmABY. Aet. 23. Fit Persons to be appointed Trustees. ,, 24. Disclaimer of a Trust. ,, 25. Acceptance of a Trust. Stxb-div. II. — The Estate op the Teustee. Aet. 26. Where the Trustee takes any Estate. 27. The quantity of Estate taken by the Trustee. 28. Eevolution of the Trustee's Estate. 29. Devise of the Trustee's Estate. 30. Bankruptcy of the Trustee. 31. TJie incidents of the Trustee's Estate at Law. 32. Failure of Cestuis que trust. SiJB-Div. m. — The Tbustee's Duties. Abt. 33. Must exercise reasonable Care. 34. Must hand Trust Property to the right Person. 35. Must not in general depute his Duties. 36. Must obey the Settlement. 37. Must not favour particular Cestuis que trust. 38. Must not set up Jus tertii. 39. Investment of Trust Funds. 40. Should be ready with Accounts. 41. Must not make Personal Profit out of Trust Property. 42. Must in general aet gratuitously. SuB-DiT. rV. — The Tetjstee's Powees. Akt. 43. General Authority. , , 44. Implied Powers in recent Settlements. ,, 45. Delegation of Powers. „ 46. Suspension of Powers by Suit. Stjb-diy. V. — The Ahthoeity of the Cestuis que teust. Aet. 47. In a simple Trust. , ,, 48. The Authority of one oiit of several in a Special Trust. ,, 49. The Authority of all in a Special Trust. Su3-i>iv. YI. — The Death, Eetieement, oe Eemovai or A Trustee. Aet. 50. Stirvivorship of the Office. „ 61. Devolution of the Office on death of Survivor. „ 52. Devise of the Office. G 2 84 ABMINISTEATION OP A TEITST. Aet. 53. Retirement or Removal from the Office. „ 64. Appointment of new Trustees hy the Court. ,, 55. Express power to appoint neiv Trustees. SuB-Div. VII. — The Protection aito Belief accorded TO Trustees. Aet. 56. Eeimhirsement. ,, 57. Protection against acts of Co-trustees. ,, 58. Wot bound to pay to Persons claiming through Cestui que trust without notice. ,, 59. Conciirrence of or Release hy Cestuis que trust. ,, 60. Laches of Cestuis que trust. „ 61. Entitled to be indemnified by gainer hy breach of Trust. ,, 62. Right to Discharge. ,, 63. Advice of a Judge. „ 64. Instituting Administration Suit. Sub-division I. — Preliminaet. Aet. 23. — Who are Fit Persons to be appointed Trustees. EvEEY person who can hold property, may have pro- perty vested in him as trustee ; but where the trust is a special trust, he can only execute it, where he is, in the eye of the law, competent to exercise discre- tion {a). Illust. — 1. An infant maybe appointed a trustee, for lie is capable of holding property, but he cannot properly carry out a special trust during Ms minority. In King v. BellordiV), V.-C. Page Wood said: "The contest arises thus : a testator having chosen to devise estates upon trusts requiring discretion as to the expediency, as to the time, and as to the manner of a sale, to three persons, one of whom is an infant, the question is, whether a contract for sale entered into by those three trustees is a valid contract which the court can specificaUy perform. There can be no doubt that if a man by his will gives an infant a simple power of sale without an interest, the iufant may exercise it It is to be observed that aU the cases relied on with reference to powers, have gone upon the principle, («) King V. Sellord, 1 H. & M. (i) Sup. ; but consider Re Card- 343. ross, L. B., 7 Ch. Div. 728. -2 i FIT PEESONS ]?0E TRUSTEES. 85 that the infant in executing the power is a mere conduit pipe; so that when the estate is created, the infant is merely the instrument by whose hand the donor acts (c). This principle fails altogether to reach the case of a devise in trust to an infant. It is not in the power of a testator to confer upon an infant that discretion which the law does not give him, although he may make the infant his hand — his agent — to execute his purpose. He cannot give an estate to an infant, and say that he may sell it, when the law says that he cannot do so." An additional objection to making an infant a trustee consists in the fact that he cannot be made liable for a breach of trust arising from negHgence (d), although he would seem to be liable for actual fraud if it can be shown that he had sufficient ability to contrive a fraud (e). 2. An alien may, since the passing of the statute 33 & 34 Vict. c. 14, hold real estate, and may therefore (it is ap- prehended) be either a settlor or a trustee. Prior to that act he could purchase lands for an estate of freehold, but could not take them by operation of law, as, for instance, by descent or jure mariti (/) ; and even if he took them by purchase he was liable to be ousted by the crown on inqui- sition found, and could not make a good title. Thus, in Fish V. inei?i {ff), a testator devised and bequeathed the residue of his real and personal estate to his wife and one Klein (an alien) upon trust to sell the same. The estate was sold for 60,000Z., but doubts having arisen as to Klein's capacity to convey the estate to a purchaser, the matter came before the court ; and the then Master of the EoUs said : " The estate being out of Klein, it is impossible to consider his alienee in any better situation as to title than Klein himseU." No doubt, however, the crown could (c) Grangev.Tivinff,'Bndg. 107. son, 1 D. & S. 503; Wrii/ht v. (d) Sindmarsh v. Southgate, 2 Snowe, 2 ih. 321 ; Davies v. Sodg- Euss. 324. son, 25 B. 177. (e) Evroy v. Nicliolas, 2 Eq. (/) Lew. 25. Ca. Ab. 489; Stilceman v. Daw- {g) 2 Mer. 431. 86 ADMnnSTEATION or A TETJST. have made a good title, and cotdd have executed the trust {h), but there -would seem to be no means of forcing the crown to execute a trust (J) ; although, it is apprehended, that practically, by means of a petition of right, the crown ■would be as amenable to the court ia this matter as an individual. 3. A married woman may undoubtedly be a trustee {h), but she is not a desirable person for the oiEce. No doubt she can exercise powers collateral, or ia gross, or appen- dant (J) ; but she can only execute a trust to sell, unaccom- panied by a power of appointment, with her husband's consent and joinder; for not only is he the party liable (?ra), but as she takes a mere legal estate, she takes it subject to her legal disabilities and incidents (ra) ; and it is appre- hended, that even where there is a power vested in her to sell, she would not be capable of entering iato a binding contract to execute the power, as it is no question aiieetiag her separate estate (o). Art. 24. — Disclaimer of a Trust. No one is bound to accept the office of trustee (a). Both the office and the estate may be disclaimed before aceeptanoe, either by deed [h) or (save in the case of a married woman, who must disclaim by deed (c) ) by doing an act which is tantamount to a disclaimer (c?). 'The disclaimer should be made (A) Lew. 29. [a] Eohinson v. Pctt, 2 Lead. Ca. (i) PauUtt T. Att.-Gen. Hard. 238. 467; Eodge\. Att.-Gen. 3T. &C. (}) Stacey v. Slph, 1 M. & K. 342. 199. {Ic) Smith T. Smith, 21 B. 385. (c) 8 & 9 Vict. c. 106, s. 7. [T] Godolphin v. Godolphin, 1 V. \d) Staccij v. Elph, sup.; Toicii- sen. 21. sm v. Tickell, 3 B. & A. 31 ; Beg- (m) Smith v. Smith, 21 B. 385. bie\. Crook, 2 B. N. C. 70; Bimj- («) Lew. 33. ham v. Clanmon-ls, 2 Moll. 253; (o) Avery v. Grijiii, L. R., 6 but see Sc Ellison, 2 Jur., N. S. Eq. 607. 262. DISGLAIMEE. 87 ■within a reasonable period, having regard to the circumstances of the particular case (e). Illust. — 1. Thus, even though a person may have agreed in the lif etune of a testator to be his executor, he is still at liberty to recede from his promise at any time before proving the will (/). 2. A prudent man will of course always disclaim by deed, in order that there may be no question of the fact ; but a disclaimer by counsel at the bar is sufficient (y) ; and in Stacey v. Elph {h), where a person, named as executor and trustee under a wUl, did not formally renounce probate until after the death of the acting executor, nor formally disclaim the trusts of the will, but purchased a part of the real estate, and took a conveyance from the tenant for life and the heir-at-law to whom the estate mxist have descended on disclaimer of the trust, it was held that he had by his conduct disclaimed the office and estate of trustee imder the wiU; and Sir J. Leach, M.E., said: "In this ease there is no ambiguity in the conduct of the defendant ; he never interfered with the property, except as the friend or agent of the widow ; and it is plain from the confidence which the testator appears to have placed in him by his will that he was a particular friend of the family It is true he never executed a deed disclaiming the trust, but his con- duct disclaimed the trust; in the purchase of the small real estate made by him, he took by feoffment from the widow and eldest son of the testator, in whom the estates could only vest by the disclaimer of the trustee." In Re Ellison's Trusts (Ji), however. Sir W. Page "Wood, V.-C, expressed some doubt whether a freehold estate could be disclaimed by parol, or otherwise than by deed ; but his (e) See Doe v. Sarris, 16 M. & (/) Dmjlo v. BlaJ:c, 2 Sch. & L. W. 522; Paddon t. Richardson, 7 239. D. M. & G. 563; James y. Frear- [gf) Foster v. Dawher, 8 W. K. son, 1 Y. & C. C. C. 370. 646. (A) Supra. 88 ABMDriSTEATION OF A TETJST. honour's attention does not appear to have been called to Stacey v. Elph, and as the case was only an unopposed petition for the appointment of new trustees, it can hardly he taken as an authority against the rules above laid down. Art. 25. — Acceptance of the Trust. A person may accept the office of trustee expressly, or he may do so constructively, by doing such acts as are only referable to the character of trustee or executor (a), or by long acquiescence. Illttst. — 1 . A trustee expressly accepts the office, by exe- cuting the settlement (J), or by making an express declara- tion of his assent (e). 2. Permitting an action concerning the trust property to be brought in his name (d), or otherwise allowing the trust property to be dealt with in his name (e), is such an acquiescence as will be construed to be an acceptance of the office. 3. So, where the office of executor is clothed with cer- tain trusts, or where the executor is also nominated the trustee of real estate under a will, he is construed to have accepted the office of trustee if he takes out probate to the will (/) ; and acceptance of the trusts of a will is construc- tive acceptance of the office of trustee of estates, devised thereby, of which the testator was trustee (y). 4. In Conyngham v. Conyngham {h), one Coleman was appointed trustee of a will, but he never expressly ac- cepted the appointment. One of the trusts was in respect (a) Speuoe, 918. [e) James v. Frearson, IT. & C. (5) Buckeridge v. Glasse, 1 Cr. C. C. 370. & Ph. 134. if) MucUow V. Fuller, Jae. 198 ; (c) Doe T. Sarris, 16 M. & W. Ward v. ButUr, 2 Moll. 533. 517. {g) JJ) VilliersY.Villiers, 2 Afk. 72. V. 485. (?) Sarton v. Harton, sup. (n) lb. SawJiins v. Luscombe, 2 Sw. 391 (o) Doe d. Cadogan v. Reart, 7 Srown v. Whiteway, 8 Ha. 145 A. & E. 636; Watson v. Pearson, Toller ¥. Atwood, 15 Q. B. 929. sup.; Doe v. Wittan, 2 B. & Al. (r) Supra. 96 ADMINISTEATIOJT OE A TETTST. 5. In Collier v. Walters (s) a testator by will, dated in 1827, had devised his estate to trustees and their heirs upon trust that they and their heirs should stand seised of the same during the life of W. 0., and also until the whole of the testator's debts and the legacies thereinafter men- tioned were paid, upon trust to let the same and apply the rents in discharge of his debts, after payment of which, they were to apply the rents in payment of legacies, and finally hold the property upon trust to pay the rents to W. C. and his assigns during his life ; and after the de- cease of W. 0. and payment of the debts and legacies and all expenses, the testator devised the property to the heirs of the body of W. C, with remainders over. In 1830, the debts and legacies being paid, the trustees conveyed the estate to W. 0. for life, who shortly afterwards, relying on the rule in Shelley's case, sufEered a common recovery and barred the entail. Upon his right to do this coming in question Sir Greo. Jessel, M. E., said: "The first observa- tion to make upon this will is this, that there is a gift to trustees and their heirs, and that the trustees and their heirs are to stand seised (they get legal seisin of something, and it was not denied that they must get an estate of free- hold of some kind or other) ' for and during the term of the natural life of my brother WiUiam, and also until the whole of my just debts and all interest due thereon have been paid.' Now the rule is this, that trustees under a de- vise to them and their heirs prima facie take a fee Now this kind of case was again considered in Poad v. Watson {i), and, there Mr. Justice Coleridge puts the rule in this way, ' The paramount rule is to look to the in- tention as appearing on the whole will. But there are secondary rules, one of which is that the words of devise to trustees and their heirs are to have their natural effect to give a fee simple, unless something shows that it is cut down to an estate terminating at some time ascertained at (s) Supra. [t] Supra. THE QUAl^TITY OF THE TBUSTEEs' ESTATE.' 97 the time of the testator's deatli. If no precise period for the termination can be shown, it remains an estate in fee.' Then Mi: Justice Erie says: 'These are words clearly meaning that the testator gave the trustees a fee simple ; but if a less estate would certainly enable the trustees to fulfil all the trust, the fee simple would be cut down to that estate.' .... That rule is therefore a rule which I think is clearly and fairly settled by authority, and should govern me in construing this will. Now there is another rule which may be collected from all the authorities, that you cannot cut down the estate in fee simple unless you can point out on the face of the wiU what less estate the trustees take. Upon that there" is immense difficulty here." Com- menting upon the various suggestions of counsel, his lord- ship continued : " The first, that they took an estate for Kfe with a chattel interest superadded, clearly will not do. . . . If you are to Imply a chattel interest from a gift to the trustees upon ti'Ust to pay debts and legacies, the chattel interest will be implied from the moment of the testator's death ; and it is impossible, therefore, to hold that they took during the life of W. C, and then took a superadded estate by imphoation upon trust to pay debts and legacies. Then, as regards the concurrent chattel interest and life estate, did anyone ever hear of such a thing as taking a chattel interest and a freehold estate together ? These two being rejected, Mr. Badnall to-day suggested a third, that they took a freehold interest for the life of the tenant for life, and, if necessary, a further chattel interest until the debts were paid." His lordship here gave rea- sons whj', on the special wording of the will, this proposi- tion was untenable, and continued: "These suggestions being out of the way, I think I am at liberty to say that human ingenuity cannot suggest a fifth. Therefore we are reduced to this. The first rule being that those wlio say they do not take a fee shall point out what estate they take, they cannot suggest any estate which in my opinion ■CJ.T. H 98 ADIUKISTRATION OF A TBITST. can be fairly and properly implied from the words used in tMs will." His lordsliip therefore held, that the trustees took the legal fee, and that W. 0. consequently, under the rule in Shelley's case, took an equitable estate tail. Obs.' — The rule restricting the estate taken by trustees to the quantity necessary' for the performance of the trust gave rise to the doctrine of indefinite terms, and determinable fees. Thus, where property was devised to trustees upon trust out of the rents and profits to pay debts, &c., it was held that they took an indefinite term necessary to enable them to pay the debts (?«). And where the devise was to trustees and their heirs, in trust to raise and pay money, it was held that they took the fee, only until the money was raised (jj). The 30th and 31st sections of the WUls Act put an end to both these doctrines with regard to wiUs executed since that act ; but, apart from its provisions, it is considered improbable that either doctrine would now be adopted {tv), and indeed the doctrine of determinable fees has been expressly overruled (2:). Art. 28. — Berolufioii of the Legal Estate. a. WTiere there are two or more trustees, they take as joint tenants ; and upon the death of one of them, the estate survives to his co-trustees or trustee. /3. Upon the death of a sole or last surviving execu- tive trustee intestate, the trust property descends to his real or personal representatives, according to its nature. 7. Upon the death of a sole or last surviving bare trustee intestate, since the passing of the Vendors and Purchasers Act, 1874, the trust property de- (u) Doev. Simpson, 5'Ea.st, 162; (ic) Hawkins on Wills, 149. AcMandY. Zutkt/, 9 A. & E. 879; {x) Doe d. Demies v. Davies, 1 Seardson v. JFUKamson, 1 Ke. 33. Q. B. 430 ; Blagrave v. JBlagrave, {v) Glover t. MoncTcfoii, 3 Bing-. 4 Ex. 550. 13. DEVOLUTION" AJ^D DEYISE OP TEUSTEE's ESTATE. 99 scends to his personal representatives, whether it be real or personal property. Illust. — 1. On the decease of a sole or last surviving trustee of leaseholds, intestate as to trust estates, the legal estate devolves on his executor ; and if the executor dies similarly intestate as to trust estates, the legal estate vests in his executor ; for an executor of an executor represents the original testator ; but if the executor of the trustee had died wholly intestate, or without naming an executor, then an administrator de bonis non of the trustee would have to be appointed to convey the legal estate, as an administrator of an executor does not represent the original testator. Aet. 29. — Devise of the Trustee's Estate. A trustee can devise or bequeath the legal estate in the trust property (a), and it will pass under a general devise or bequest of his property, unless I the will contain expressions authorizing a narrower construction, or the disposition of the estate so devised or bequeathed is such as a testator would be unlikely to make of property not his own (5). IiLirsT. — 1. Thus, where a testator subjects the property, passing under a general devise, to the payment of debts or legacies (c), or directs them to be sold {d), or devises them to persons as tenants in conunon (e), or to a numerous and unascertained class (/), or Umits them in strict settle- (ff) "Wiether the devisee can {c) Re Morley, 10 Ha. 293 ; He ezemie the trust is a totally dif- Tacfcman J- Moss, L. E., 1 Ch. ferent question, as to which see Div. 214 ; hut see He JBrou-n ^■ Art. 52, infra. Constructive trust Sibleij, 24 W. B. 783. estates (as land agreed to he sold) {d) Be Morley, sup. passunderadeviseof trustestates. (e) Martin v. Zavei-ton, L. E., LysagU y. Edwards, L. B., 2 Ch. 9 Eq. 568. Div. 499. /7ft t-f /f ^¥. (/) Re Finneij, 3 Gif. 465; see (b) Braijbrooke v. Inskip, 8 V. also Re Packman ^- Moss, sup.; and 436 ; Bx parte Morgan, 10 V. 101 ; compare with Re Brown # Sibley, langford v. Angel, 4 Ha. 313. sup. H 2 100 ADMINISTEATION OF A TETJST. ment (y), or in any otlier way whicli makes it impossible to say the intention could be to give a dry trust estate (z), trust estates ■will not pass. Aet. 30. — Bankruptcy of the Trustee. The property of a bankrupt divisible among his creditors, does not comprise property which can be identified («) as property held by him as trustee for any other person (S), even though he may have converted it into property of a difEerent character (c), and although it is property in his order and dispo- sition at the commencement of the bankruptcy {d). Illust. — 1. If goods consigned to a factor be sold by him and reduced into money, yet if the money can be identi- fied — as, for instance, where it has been kept separate and apart from the factor's own monies, or kept in bags, or the like (e), or has been changed into bills or notes (_/), or any other form (y), — the employer, and not the creditors of the factor, will, upon his bankruptcy, be entitled to the pro- perty into which it has been converted ; for the creditors of a defaulting trustee can have no better right to the trust property than the trustee himself (/«), and it makes no difference in this respect that the trustee committed a breach of trust in converting the property, for an abuse of (li) Braytroolie fr . Inship, sup. [d) Ex parte Barry, L. E., 17 (z) lb.; and see Att.-Gen. v. Eq. 113; Ex parte Marsh, 1 Atk. Vigor, 8 v. 276. 158. As to constructive trua- (ffl) Toolce V. Hollingworth, 5 tees. Ex parte Fease, 19 V. 46 ; T. K. 277 ; Ex parte Eumas, 1 At. WhitefieU v. Brand, 16 M. & W. 234. 282. (5) 32 & 33 Vict. c. 71, s. 15 ; (e) TooU v. BoUingworth, sup. Houghton v. Komig, 18 C. B. (/) Ex parte Dumas, 2 V. sen. 236 ; Winch v. Keeleg, 1 T. R. 582. 619. {g) Frith v. Cartland, 2 H. & [c] Taylor v. Flumer, 3 M. & S. M. 417. 675 ; Scott v. Surman, 'Willes, (A) 16. 404. trustee's estate at latv. 101 trust can confer no right on the person abusing it, or those claiming through him (i). 2. But where the trust property has become so mixed up with the bankrupt's private property as to lose its identity (or earmark, as it is usually called), for instance, where it has been converted into money, which has been put in circulation (A), or has otherwise become indistinguishable, then, as the right of the cestui que trust is only to have the actual trust property, or that which stands in its place, and as the actual property is gone, and that which stands in its place cannot be identified, the cestui que trust can only prove against the bankrupt's estate as one of his general creditors (l). Art. 31. — T/ie Incidents of the Trustee's Estate at Laic. At law, the estate of the trustee is subject to the same incidents as if he were the beneficial owner, except where such incidents are modified by act of par- liament. Illtjst. — 1. Thus he is the proper person to bring ac- tions arising out of viTOngs formerly cognizable by common law courts, and which necessitated the possession of the legal estate in those bringing them (a) ; and it is appre- hended that the Judicature Acts have made no distinction as to this. 2. So at law, the estate of the trustee in real property is liable to curtesy (5), dower (c), and, if of copyhold tenure, to freebench {d) ; but of course the persons so taking could only take as trustees for those beneficially entitled (e). (») Tai;lor y. Flumer, sup. [h) Sennetf v. Davis, 2 P. W. {k) Miller Y. Eaoe, 1 Bixr. 457 ; 319. see per Lord Kenyou. (c) Nod v. Jevm, Pre. 43; Nash {I) Ex parte Dumas, 1 Atk. 234; v. Freston, Cro. Car. 190. Byall T. MoUe, ib. 172; Scott y. [d) HintonY. Sinton, 2V. sen. Surman, sup. 638. (a) May v. Taijlor, 6 M. & Gr. (e) Noel v. Jevon, sup. ; LloyA 261. V. Lloyd, i Dr. & War. 354. 102 ADMINISTRATION OF A TBtTST. Formerly it was also liable to forfeiture and esclieat, but tbere can no longer be forfeiture or esclieat of a trust estate (/). 3. So, again, trustees of copyholds who take an estate must be admitted by the lord of the manor on the cus- tomary terms (y). 4. Where a debtor to the trust estate becomes bankrupt, the trustee is the proper person to prove without the con- currence of the cestui que trust iji), unless in the case of a simple trust. Where it is as likely as not that the debtor has paid the cestui que trust direct, then it lies in the discretion of the judge to require the concurrence of the cestui que trust (i). 5. The trustee of a private trust is, as legal owner, liable to be rated in respect of the trust property iJi). 6. If the trustee, in pursuance of the trust, carry on a business for the benefit of the cestui que trust, he will yet be personally liable to the creditors of the business (;), and may be made a bankrupt (»i). 7. On the other hand, the ordinary legal incident of voting for members of parliament does not belong to the trustee in respect of the trust estate, as the act 6 & 7 Yict. c. 18, s. 74, confers that right on the cestui que trust. It would, however, seem that the trustee stOl retains the right of voting for coroners (ra). (/) 13 & li Vict. c. 60, s. 46. (/) FarliallY. Farliall, L. U., 7 (g) Wilson y. Soare, 2 Ji.& Ad. Ch.. \2i-A0wen\. Delamere^'L.'B,., 350. 15 Eg^34.i5X^ /i'yo^ (/() jEx parte Green, 2 Dea. & A/^ Wightman v. Townroe, 1 M. Ch. 116. A S. 412 ; Ex parte Garland, 10 (i) Ex parte Dubois, 1 Cox, 310; /V. 119; Farhally. Farhall, sup. Ex parte Gray, 4 Dea. & Ch. 778. / (m) Burgess v. Wlieate, 1 Ed. 251 ; {k) Reg. v. Sterry, 12 A. & E/ 58 Geo. 3, u. 95, s. 2, repealed by 84 ; Reg. v. Stapleton, 4 B. & ». 7 & 8 Vict. o. 92 ; Reg. v. Say, 3 629. E. & B. 859. (/J C^^ /Z^ PAILUEE QP CESTtnS QUE TBUST. 103 Art. 32. — Trustee's Estate on total Failure of Cestuis que trust. Wliere a trust does not exhaust tlie wliole of the trust property, and there is no one in whose favour the trust can result, then, if the trust property be real estate, the trustee takes absolutely (a), and if per- sonal estate, it goes to the crown as bona vacantia (6). Illtjst. — 1. In the leading case of Burgess v. Wheate (c), the settlor conveyed real estate unto and to the use of trustees, in trust for herself, her heirs and assigns, to the intent that she should appoint, and for no other use what- ever. She subseq^uently died without having appointed, and without heirs ; and it was held that (there being holders of the legal estate — namely, the trustees) the crown could not claim by escheat, and that the trustees (no person remaining who could sue them in equity) re- tained, as the legal proprietors, the beneficial interest also. 2. But if the settlor in the last case had appointed or devised her equitable interest to C, in trust for purposes which could not take effect, then, as between the original trustees and C, the latter would be entitled to the property as the nominee under the will. The court will, as between those parties, only carry out the testator's directions, and wUl not inquire how far the directions can be executed in their integrity {d). 3. The rule also applies to a constructive trustee. Thus a mortgagee in fee, whose mortgagor dies intestate and without heirs, takes the property absolutely, subject to the mortgagor's debts (e). Whether this would be the case if the mortgagee was a mere equitable mortgagee, seems to be more doubtful ; but it is submitted that, on the principle of Onslow V. JVallis, the result would be the same as if he were the legal mortgagee. (a) Burgess v. Wlimte, 1 Ed. (c) Supra. 177. {d) Onslou) v. WalUs, 1 M. & \b) Taylor v. Sat/garth, 14 Sim. G-. 506 ; and see Jones v. GoodchiU, 8 ; Mlddkton v. Sjiicer, 1 B. C. C. 3 P. "W. 33. 201. (e) Healer. Symonds, 16 B. 406. 104 ABJIDTISTEATION OF A TSTJST. SUB-DIVISION III. The Duties of a Trustee. Akt. 33. — A Trustee must exercise reasonable care. Except where courts of equity have imposed distinct and stringent diities upon trustees (which duties are mentioned in the' succeeding articles of this suh-diyision), they are only hound to exercise a reasonahle discretion, and to use such due diligence and care as men of ordinary prudence and vigilance would use in the management of their own affairs (a). But, nevertheless, the mere fact that a trustee who has done an act which is, ia fact, a breach of trust, did so under the advice of a pro- fessional man, will not excuse him [b). Yet it is apprehended that it would be strong evidence of dlligenoe where the alleged breach is alleged to have arisen from mere negligence, and not from the breach of some distinct duty. Illttst. — 1. Thus, it is their duty to realize debts owing to the trust estate with all conveiiieiit speed (c), but they are not bound to commence legal proceedings when, in the exercise of a reasonable discretion, they consider it inexpe- dient to do so. For instance, in a case where one cestui que trust would have been ruined by the immediate reali- zation of a debt due from him to the trust ' estate, and the other cestuis qtie trust (his children) would have been seriously prejudiced, the House of Lords held, that the («) Brice v. Stakes, 2 Lead. (c) Buxton v. Buxton, 1 M. & Cas. 865; MasseijY. Banner, 1 J. C. 93. As to its effect as eyi- »fe W. 247. dence of diligence, see and con- (b) Doyle v. Blahe, 2 Sch. & L. sider judgment of Jessel, M.B., 243 ; He Knight, 11 B. 49. in Me Cooper, infra, Illupt. 6, and also Illust. 9. TBUSTEE MUST EXEECISE CAEE. 105 trustee exercised a reasonable discretion in refraining from suing the debtor and in allowing him time, and that the trustee was consequently discharged from liability for any consequent losses (d). 2. So trustees may release or compound debts due to the trust estate, where they bona fide and reasonably believe that that course is for the benefit of their cestuis que trust (e). Yet they must not be negligent, nor must they fail to exert themselves to realize a debt (/). 3. Thus where trustees allowed rents to get in arrears which they might have recovered by proper diligence, it was held that they were' liable to make good the arrears, though without interest, the judge saying: "If there be crassa negligentia and a loss sustained by the estate, it falls upon the trustee " (y). 4. Where a trustee indebted to the trust becomes bank- rupt it is his duty to prove the debt, and if he neglect to do so he wiU be liable for the loss, notwithstanding that he may have obtained his certificate ; for, as was observed by Sir J. Eomilly, M.E. : " Suppose a person owing money to a trust estate becomes bankrupt, and the trustee is a distinct and separate person, knowing of the bankruptcy, he is bound to prove the debt ; if he does not, he commits a breach of trust, and would be held liable for all that he might have received under the commission if he had proved the debt as he ought to have done. Is the case altered because the trustee is himself the debtor ? I think not ; the original debt, no doubt, is barred, but the amount of the dividends which the trustee might have received under the commission is a liability subsequently attachiug to the (d) Ward v. Ward, 2 H. L. C. T. & C. 221 ; Tidcer v. Smith, 2 S. & G. i6 ; Cafrey v. Daley, 6 76 (e) Blue V. Marshall, 3 P. W. V. 488. 381 ; Forshato v. Higginson, 8 {g) Tells v. Carpenter, 1 Mad. D., M. & G-. 827. 291 ; and see as to interest, law- ('/) Wiles-v.Oresham,i'D.,'M.. son v. Copeland, sup.; Wiles v. & Gr. 770 ; Lawson v. Copeland, 2 Gresham, 2 Dr. 258 ; Eoxoley v. B. C. C. 156 ; Bailey v. Gould, i Adams, 2 H. L. 0. 725. 106 ABMnflSTEATION OP A TRUST. trustee in tliat cliaraeter, and is not affected by tlie bank- ruptcy or tbe certificate " {h). 5. So, agaia, wbere a settlor has, forvaluable consideration, covenanted to settle property, a trustee who neglects to en- force the covenant is liable forany loss occasioned thereby (2). 6. Or, again, if a trustee neglect to register the trust instrument ("where it requires to be registered), and the settlor is thereby enabled to effect a mortgage on the pro- perty, the trustee mU. be hable {k). 7. In the exercise of due diligence, trustees for sale will, of course, use their best endeavours to sell to the best ad- vantage. They should, therefore (in gerieral), abstain from joining with the owners of contiguous property in a sale of the whole together, unless, indeed, such a course would be clearly beneficial to their cestuis que trust, for by doing so they expose the trust property to deterioration on account of the fiaws or possible flaws in the title to the other property ; but "suppose there were a house belong- ing to trustees, and a garden and forecourt belonging to somebody else, it must be obvious that those two properties would fetch more if sold together than if sold sepa- rately; you might have a divided portion of a house belonging to trustees, and another divided portion be- longing to somebody else. It would be equally obvious if these two portions were sold together, that a m.ore bene- ficial result would thereby take place But in those oases where it is not manifest on a mere inspection of the properties that it is more beneficial to sell them to- gether, then you ought to have reasonable evidence that it is a prudent and right thing to do, and that evidence, as we know by experience, is obtained from surveyors and other persons who are competent judges " (Z). (A) Orrett v. Corser, 21 B. 52. W. N. (1877) 15. It) Woodhouse v. IFoodhoiise, L. [1) Per Jessel, M. R., Se Cooper E., 8 Eq. 514. ^- Allen's Contract, L. R., iCh. D. (k) Macnmiara v. Carey, 1 Ir. 817.^ /-^l^w^ fi. JZS^ R., Eq. 9; Kingdony. Castlcman, ' TBUSTEE MUST EXEECISE CABE, 107 8. " Wliere trustees for sale are joint owners with a third party, or are reversioners, it is obvious that they may in general join in a sale ; for everybody knows that as a general rule (of course there are exceptions to every rule) the entirety of a freehold estate fetches more than the sum total of the undivided parts, or the separate values of the particular estate and the reversion" (m). 9. Again, trustees for sale ought not to do any act which will depreciate the property, and so they ought not unnecessarily to limit the title (re), for no reasonable man would unnecessarily depreciate his own property by such means. 10. Again, if trustees for sale, or those who act under their authority, faU in reasonable diligence in inviting competition, or if they contract to sell under cii'ctimstances of great improvidence or waste, they will be personally responsible (o). It is therefore the duty of trustees for sale to inform themselves of the real value of the property, and for that purpose to employ, if necessary, some experienced person to value the same {p). 1 1 . The same principle holds good in the case of trustees for purchase, or for investing trust moneys on mortgage, who ought to clearly satisfy themselves of the value of the property, and for that purpose to employ a valuer of their own, and not trust to the valuer of the vendor or mortga- gor ; for a man may bona fide form his opinion, but he looks at the case in a totally different way when he knows on whose behaK he is acting; and if the trustees rely upon the vendor's valuer, and he, however bona fide, values the property at more than its true value, they will be liable (y). 12. Trustees for purchase, or for investment on mort- (ot) Xb. (p) Oliver v. Court, 8 Pr. 165 ; (») See Sohson v. Sell, 2 B. 17 ; Campbell v. Walker, 5 V. 680 ; and RedeY Oalces, 10 Jar., N. S. 1246. see per Jessel, M. E., Re Cooper (o) Orel Y. Mel, 5 Mad. 440; g- Allen, L. E., 4 Ch. D. 816. Z/ and Anon., 6 Mad. 11 ; Rechel v. ( -, / C^ ' is) Lew. 440. And as to ad- (w) Ih. vancing trust money on a cove- \x) Cock v. Goodfelhw, 10 Mod. nant to surrender copyholds, see 489. Wyatt V. Sharratt, 3 B. 498; and (y) San-is v. Sarris, 29 B. 107. as to equitable mortgages gene- (a) Stichietj v. Sewdl, 1 M. & rally, Norris v. Wright, U B. 308 ; C. 8 ; Drosier v. Brcreton, 15 B. LoclchaH v. Seillij, 1 D. & J. 476. 221. (*) See Fococlc v. Beddington, (a) Budge v. Gummoio, L. E., 5 V. 794 ; Potts T. Britton, L. E., 7 Cli. 719 : Stretton v. Ashmall, 3 II 'E^.iZZ; BethellY. Abraham, Dr. 12. /\ L. E., 17 Eq. 24/> and see Byder (b) lb.; iind Moyds v. Eoyds, 14 V. Bickerston, 3 Sw. 81, n. {a). B. 54. \ '/,, isf' TKUSTEE MUST EXERCISE CAEE. 109 But, nevertheless, if they exceeded these limits, yet if they acted bona fide and used reasonable care, they •would not be liable (c). 15. A trustee is not responsible for a mere error of judgment, if he has exercised a reasonable discretion, and has acted with diligence and good faith. Thus, where an executor omitted to sell some foreign bonds for a year after the testator's death, although pressed to do so by his co- executor, and although there was a direction in the will to convert with all reasonable speed, he was held irresponsible for a loss caused by the bonds falling in price ; for although the conclusion he came to was unfortunate, yet having exercised a bona fide discretion, the mere fact of the loss was not sufficient to charge him {d). As to what constitutes a reasonable delay, that depends on the particular circum- stances affecting each case, but, prima facie, a trustee ought not to delay realization beyond a year, even where he has apparently unlimited discretion (e); and if he procrastinates beyond that period, the onus wiU be cast upon him of proving that the delay was reasonable and proper (/). 16. A trustee will not be liable if the trust property be stolen, provided he has taken reasonable care of it (^). 17. A trustee is not bound to insure leasehold premises against loss by fire. In Bailey v. Gould (h), it was sought to charge an executor who had neglected to continue an insurance ; but Baron Alderson said : " It was a contingent claim, which the testator might by possibility himself have realized, but which he did ,not It was no claim {e) Lew. 287. 276; Bolinson v. Sohinson, 1 D., [d) Buxton V. Buxton, sup. ; and M. & G-. 252. seeFaddo?iY.Sichardson,TD.,'M.. (/) See per Wood, L. J., in & Gr. 563. Grayhourne v. Clarkson, L. R., -3 {e) Sculthorpe v. Tipper, L. E., Ch. 606, and Sughes v. JEmpson, 13 Eq. 232 ; and as to the pro- 22 B. 181. priety of an executor allowing (cf) Moyhy v. Morleij, 2 Ch. C. the testator's money invested on 2 ; Jones v. Lewis, 2 V. 240. mortgage to remain so until (A) 4 Y. & C, Ex. 221; and wanted, see OrrY. Newton, 2 Cox, Doison v. Land, 8 Ha. 216. 110 ADMINISTEATION OF A TKUST. existing at tlie time of the testator's decease. What then existed the executors did possess, that is, the leasehold premises. Being in their possession, a fire, for which they ■were not to blame, occurred. It was a mere misfortune which took place. Can the loss be said to have happened by their default in not keeping up a contingent claim? Was this property which, but for their default, they might have got ? It is very difficult to say that it was." 18. Trustees being liable for gross negligence, they are, k fortiori, liable where they combine reckless disregard of the interests of their cestuis que trust with mala fides. Thus, where one trustee retires from the trust _/or the pur- pose of enabling his co-trustee to commit a breach of trust, or in order, as he thinks, to relieve himself from the responsibility of the wrongful act meditated by his co-trus- tee, he will be held as fully responsible as if he had been partioeps criminis («'). 19. Even a quasi trustee, such as a vendor before com- pletion of the sale, is obliged to take due care of the pro- perty, and to see that it does not become unnecessarily depreciated by want of care iji). Art. 34. — Trustee must see that lie hands the Trust Property to the right Person. The whole responsibility of handing the trust property to the persons entitled falls upon the trustee ; and if he hands it to the wrong person, either through mistake on his part or in consequence of some fraud practised upon him, he will have to make the loss good, however carefid he may have been. In cases of doubt, therefore, the trustee should apply to the court for its direction [a). Illtjst. — 1. Thus where a trustee makes a payment to one who produces a forged authority from the cestui que (i) Norton v. Pritchard, Eeg. (k) See E. Egmont t. Bmitli, Lib. B. 1844, 771 ; Le Bunt v. L. E., 6 Cli. Div. 475. X y 7i • Webster, 9 W. K. 918 ; JPalairet [a) Talbot v. E. Radnor, 3 M. & T, Careu', 32 B. 567. K. 252; Mulin t. Blagrave, 25 B. TEUSTEE MUST PAT THE EIGHT PEESON-. Ill trust, the trustee, and not the cestui que trust, mil have to bear the loss ; for, as •was said by Lord Northington {b), " a trustee, whether he be a private person or a body cor- porate, must see to the reality of the authority empowering him to dispose of the trust money; for if the transfer is made without the authority of the owner, the act is a nullity, and in consideration of law and equity the right remains as before." 2. 80, again, trustees who paid over the trust fund to wrong persons upon the faith of a marriage certificate which turned out to be a forgery, were made responsible for so much of the trust fund as could not be recovered from those who had wrongfiilly received it (c). 3. A trustee who, by mistake, pays the capital to the tenant for life instead of investing it and paying him the income only, will have to make good the loss to the estate, although he will, as wiU. be seen hereafter ((;?), be entitled to be recouped out of the life estate (e). Obs.— It is difSicult to see how the law, as above stated, could have come into being, except upon the false analogy of a trustee, to a banker or creditor. As has been shown in the last article, a trustee is in the position of a gratui- tous bailee ; he must take reasonable care of the trust property, and if it is lost or stolen he is discharged from responsibility, provided that he was guiltless of negligence. If, then, a-carefiil trustee is not responsible for property stolen from his custody, upon what conceivable ground should he be held responsible for property obtained from him by false pretences or forgery, which are crimes far more subtle, and against which it is much more difficult to safeguard oneself. It is humbly suggested, therefore, that 137 ; Ashby v. Blaclcioell, 1 Ed. 1 Ch. 26 ; and Suttmi t. Wilder, 302 ; Eaves v. Bickson, 30 B. 136; L. R., 12 Eq. 373. Sporle T. Burnalij, 10 Jur., N. S. (d) Infra, Art. 61. 1142. {e) -Barratt v. Wyatt, 30 B. 442 ; {b) Ashhj V. Blackwell, sup. Davies v. Hodgson, 25 B. 177 ; (e) Eaves t. Sickson, sup.; and Griffiths v. Porter, ib. 236. see also Bostock v. Eloycr, L. R., 112 ADMINISTIlATIOlir OF A TRUST. in these instances the law migM be reconsidered with ad- vantage. Art. 35. — Trustees must not in general depute their Duties. A trustee may not depute his duties or authority (a), either to a stranger (J) or to his co-trustees or co- trustee (c), save only — a. Where he is obKged to do so from necessity (d); /S. Where by doing so he is acting conformably to the common usage of mankind, and as prudently as if acting for himself, and according to the usage of business (c ) ; or 7. Where the settlement has authorized his doing so (/). But even where he mat/ safely permit another to re- ceive trust property, he will not be justified in allowing it to remain in such other person's custody for a longer period than the circumstances of the case require (g). Illust. — 1. Thus a trustee for sale, who leaves the whole conduct of the sale to his co-trustee, cannot shield himself from responsibility for the latter's negligence by saying that he left the matter entirely in his hands (h). But, on the other hand, there is no objection to his em- ploying an agent where such a course is conformable to the common usage of mankind, and the trustee acts as pru- (a) See per Lord Laugdale, Sch. & L. 3il ; Ite Bird, L. E., Turner v. Corney, 6 B. 617. 16 Eq. 203. {b) Adams Y. Clifton, 1 Russ. {e) St. § 1269 ; Ex parte Selchier, 297 ; Turner v. Comet/, sup. ; Ami). 219 ; Glough v. Bond, sup. Chambers t. Minchin, 7 V. 196 ; (/) Kilbee v. Snei/d, 2 MoU. Wood T. Weightman, L. R., 13 199; Doyle y. Blake, 2 Sch. & L. Eq. 434. 245. (c) Langford v. Gascoigne, 1 1 V. [g) Briee v. Stokes, 2 Lead. Cas. 333; Cloiigh v. Bond, 3 M. & 0. 865; Gregory v. Gregory, 2 Y. & 497; Cowel v. Gatcombe, 27 B. C. 313; JJe JVj/cr, 3 K. & J. 317. 668 ; Eaves v. Siclcson, 30 B. 136. (A) Oliver v. Court, 8 Pr. 166 ; (d) Bennett v. Wyndham, 4 Le Ze Cliertsey Market, 6 Pr. 285 ; G-. k J. 259 ; Jay v. Campbell, 1 Hardwicke v. Mynd, 1 Anst. 109. TRUSTEES MUST NOT DEPUTE THEIE DUTIES. 113 dently as he would have done for himself (i). But he must not allow such agent to receive the purchaser's money, or he will be responsible for its loss (k) ; and, therefore, if ' "trustees for sale join with any other person in a joint sale of the trust property, and any other property, whether that person be a trustee himself or be a beneficial owner, they must take care that their share of the purchase-money is paid to them, and the purchaser must take care of that likewise, because he can only pay trust money to the trustees. Therefore, when they do join with other people the piu'chase-money must be apportioned before the com- pletion of the purchase, and must be paid by the pur- chaser, the apportioned part coming to the trustees to be paid to them" (l). 2. And so where a trustee handed money to a solicitor for the purpose of reinvestment, and the solicitor professed to have, but in reaUty had not, invested it, but had used it for his own purposes, and himself paid interest on it for some j'ears until his death, it was held that the trustee was liable (m), for he ought not to have entrusted the money to a solicitor when there was no necessity' ; and it is not in the eye of the law (although it is probably in point of fact) the usage of mankind to do so, as may be seen in the frequent case of a purchaser of propertj^, who makes him- self liable to the vendor if he pays the purchase-money to the vendor's solicitor without express authority (w). 3. In Hopffoocl V. Parkin (o), the late Lord EomOly carried the liability of trustees for the acts and defaults of their agents to a height which, it is with humility sug- gested, was by no means justified, either on principle or authority. In that case, trustees, having trust funds to- lend on mortgage, employed a solicitor to investigate the (i) Ex parte Belehier, sup. [m) Bostocjc v. Floijer, L. K., 1. (k) Lew. 383. Eq. 29; but see Ee Bird, L. E.,. (?) Per Jessel, M. K., Re Cooper 16 Eq. 203; and infra, lUust. 4. &■ Allen's Contract, L. R., 4 Ch. D. («) Dart, 6.56. 815. - " (") L- R-, 11 Eq. 70. U.T. I 114 ADMINISTEATION OF A TB.UST. mortgagor's title. Owing to tlie solicitor's negligence, in failing to make proper inquiries as to previous incum- brances, the trust moneys advanced on the mortgage were to a large extent lost, and his lordship held that the trustees must replace them. But it is difficult to under- stand upon what grounds the learned judge based his opinion. The trustees were right in investing on mort- gage ; they were right in employing a skilled person to investigate the real value of the security ; indeed, it is apprehended, from the remarks of Sir George Jessel, M. E., .in Re Cooper {p), which have been quoted in the 7th illus- tration to Article 33, that it was the duty of the trustees to employ a skilled person. In addition to which, there was a moral necessity for them to employ a skilled agent to investigate the title, and they were but acting conformably to the general " usage of mankind, and as prudently for the trust as for themselves, and according to the usage of business" {q). If, then, they were right in employing the solicitor to investigate the title for them, tipon what possible ground could they be holden responsible for their agent's default. As Lord Hardwicke said, in Ex parte Bel- chier (r), if the defendant " is chargeable in this case, no man in his senses would act This court has laid down a rule with regard to the transactions of assignees, and more so of trustees, so as not to strike a terror into mankind acting for the benefit of others, and not for their own;" and his lordship then proceeded to \q.j down the rule as above stated. It is with great respect submitted, that Lord Eomilly confused the case with those in which it has been held that a trustee is responsible for a breach of trust which he has committed bona fide and under skilled advice. The distinction is, however, clear. The trustees had not done anything vn-ong. They had not coimnitted any breach of trust at the instance of another. They had merely lent money through the medium of an agency, [p) Supra. [r) Supra, (ij) Per Lord Hal■d^7icke, Ex parte Belchicr, Amb. 219. TRUSTEES JITJST NOT DEPUTE THEIE DUTIES. 115 which they were entitled, and indeed bound, to employ, on the ground of moral necessity, and they ought therefore to have been discharged from the loss. Had there been a distinct breach of some duty which the settlor had cast upon the trustees, then, although they might have taken and followed the best advice procurable, they would no doubt have been properly held responsible ; but here, the only possible breach of duty was the negligence of an agent, and, as has been said above, a trustee is only responsible for his agent where he has improperly employed one. 4. In Re Bird (s), on the other hand, Vice-ChanceUor " Bacon seems (if I may say so, with great submission, ) to have gone to the opposite extreme. There, one of three executors employed the solicitor of the testatrix for the purpose of obtaining a settlement with a creditor of the testatrix. The solicitor subsequently informed the execu- tor that the compromise had been efEeoted, and requested a cheque for the amount, which the executor sent. No com- promise had ever been made, and the solicitor appropriated the money to his own use. Here it might have been antici- pated that the executor would have been held liable, as, in accordance with Bostock v. Floyei-{t), he ought to have paid the money to the creditor personally and not to the solicitor ; but the Yice-Chancellor decided that he was not liable, say- ing, " It seems to me that the executor has done just what any prudent man would think himself safe in doing. He finds thatthetestatrixhad in her lifetime employed Mr. Hunt as her solicitor. He had been employed as her solicitor on various matters ; his credit was not called in question, his ability was not doubted. He had arranged for her some other claims, and when, after her death, a claim is made by these two companies, naturally enough Mr. Hunt is employed to conduct the business, namely, the compromise of these claims. Having employed this attorney to nego- ' tiate for a compromise, and being told by him ' I have got (5) L. E., 16 Eq. 203. (*) L. E., 1 Eq. 29. I 2 116 ADMINISTEATION OF A TETJST. these terms for j'ou, and 310?. is payable/ the executor puts into his hands the 310Z. What negligence is there in that? What incautious trusting to some other person's representation? It is all in the ordinary course of the business then being transacted, and I cannot thiuk that the executor has neglected any caution which it was in- cumbent on him to exercise." Whether or not the present state of the law will permit of a trustee entrusting a soli- citor with money, it is suggested that his honor's decision is in accordance with that summa ratio which the simple- minded believe to be equivalent to the summiim jus. 5. A trustee will be liable where he has imnecessarihj left trust moneys in the hands of a banker or broker who fails, when he ought to have invested them, or where he has paid money to a banker or broker for investment and has neglected for some time to mate inquiries as to such in- vestment («() ; and the tisual cI&u&q indemnif jdng him against the acts or defaults of others will not protect him(j)). 6. On the other hand, where money has been deposited in a bank pending investment, and not for an unnecessary length of time, the trustee will not be liable for the failure of the bank (?o), for it is according to the common usage of mankind to make use of banks for the safe custody of their money. 7. So a trustee may appoint stewards, bailiffs, workmen, and other agents of the like kind, for there is a moral necessity for him to do so {x). 8. So where one executor lives at a distance from the testator's place of abode, he may remit money to his co- executor who lives in the immediate vicinity, for the pur- pose of paying the testator's debts, for "he is considered to do this of necessity. He could not transact business without trusting some person, and it would be impossible (if) Chalkn v. Shippmn, 4 Ha. (tv) JoJmsonv. Kcu-ton, H Ha. 655 ; IteMenY. Wesky, 29 B. 213; 160 ; Fenu-icl- v. Clarke, 31 L. J., Matthews v. Brise, 6 B. 239. Ch. 728 ; and per Lord Hard- (v) Rehdenx. Wesleij, svp. Vfiokn, JEx parte Bekhier, mp. {x) Ibid. TBXJSTEES MUST NOT DEPITTE THEIE. DUTIES. 117 for itim to discliarge liis duty if he is made responsible ■where lie remitted money to a person to -whom he would himself have given credit, and would in his own business have remitted money in the same way" (y). 9. Again, trustees may remit money through the medium •of a respectable bank, as being the most convenient and the safest mode (z) ; but they should pay the money into the bank as trustee eo nomine (a). 10. A trustee may safely permit his co-trustee to receive or collect trust moneys (S) ; and even though he join in the receipt for such moneys, and thereby acknowledge that he has received them, he will not be liable if he can prove (c) that he did not in fact receive them, and only joined in the receipt for the sake of conformity (c^). For one of several trustees cannot alone give a good receipt, unless expressly empowered to do so, and all must, there- fore, join (e) ; so that, although at law the signature of a trustee is (or rather was {/) ) conclusive evidence that the money came to his hands, " equity, which pursues truth, will decree according to the justice and verity of the fact"(--f/< Ji H Eq. 24. J • , ,... /- /, ,' ; {!)) Berry v. Gibbons, L. 'R., 8 (A) Siqira. 138 ABMIN'ISTEATIOJSr OF A TEIJST. had been made in a creditors' suit, for the administration of the personal estate of a testator, hut no receiver had been appointed, nor any injunction granted to restrain the executrix from dealing with the assets. More than two years after the decree, the executrix, who was also the sole legatee, opened an account with a bank as such executrix. The account becoming overdrawn, she deposited with the bank a picture, belonging to the testator's estate, by way of security. It was contended, that although the bank had no notice of the suit, yet that it being a lis pendens, they ought to have searched the register. But Lord Justice James said : "In my opinion, the executrix had the legal right to make such a deposit. In order to deprive them (the bank) of the benefit of it, there must be evidence to show that they had notice of there being some breach of trust in the transaction. Now it appears to me that the bankers did nothing but what was in the usual course of business, and that there is nothing to fix them with any notice of a breach of trust. The doctrine of lis pendens has no bearing on the case ; for a mere administration decree, no receiver having been appointed, nor any injujic- tion granted to prevent the executrix from dealing with the assets, would not take away her legal powers so as to invalidate the title of persons claiming under a disposition made by her in exercise of those powers." AUTHOEITY OF CESTTOS QTXE TErST. 139 8UB-diat:sion v. The AuTHOEiTY of the Cestuis que trust. Akt. 47. — The AuthorUy of the Cestui que trust in a Simjyie Trust. The cestui que trust in a simple trust is entitled to have tte legal estate vested in him or his as- signee (a). Akt. 48. — The Authority of One of several Cestuis que trust partiaUij interested in a Special Trust. The authority of one of several cestuis que trust in a special trust, who is only partially and not abso- lutely entitled to the trust property, ia general depends upon the terms of the trust as construed by the coiu't ; but if sui juris, the cestui que trust cannot be restrained from assigning his or her interest, save only in the case of a married woman, who may by apt words in the settlement be re- strained from doing so during her coverture, but not afterwards (&). Illtist. — 1. In Tidd v. Lister (c), real and personal pro- perty was devised and bequeathed to trustees, upon triist to pay debts and funeral expenses, to keep the buddings on the real estate insured, to satisfy the premiums upon certain policies effected on the lives of the testator's sons, to allow each of his sons an annuity, and, subject thereto, in trust for his daughter for life, with divers remainders over. The personal estate sufficed to ■paj all but the insurance premiums, and the daughter, who was a feme covert, filed '?-' ^/\' 6// {a) Smith v. Wheeler, 1 Mod. 409^iror7«(;,i v. Sbrfoc/.-, 2D., M. 17; Brown t. JIoio, Bam. 354; & G-. 644; Tullct v. Armstrong, Att.-Gcn. T. Gore, ii. 150; Xaye 4 M. & C. 392; Se Gaffce, 1 M. & V. Powell, 1 V. 408. G. 647 ; Suttanshmo t. Marten, [b) Fybus v. Smith, 3 B. C. C. Johns. 89. 340, n. ; He Bllis, L. E., 17 Eq., [e) 6 Mad. 429. 140 ABimflSTEATIOU- OF A TEUST. a bill praying to be let into possession, upon securing the amount of the premiums of the policies. Bat Sir John Leach refused her request, on the ground that the testator had placed the direction of the property in the hands of the trustees, ■which was for the advantage of those who were to take in succession, and that a court of equity ought not to disappoint the testator's intention by delivering over the possession to the tenant for life, unprotected against her natural tendency to favour herself at the expense of those in remainder. " There may be cases in which it is plain, from the expressions in the will, that the testator did not intend the property should remain under the personal management of the trustees : there may be cases in which it is plain from the nature of the property that the testator could not mean to exclude the cestui que trust for Hfe from the personal possession of the property ; as in the case of a family residence. There may be very special cases in which the court would deliver the possession of the pro- perty to the cestui que trust for life, although the testator's intention appeared to be that it should remain with the trustees ; as where the personal occupation of the trust property is beneficial to the cestui que trust, in which case the court, by taking means to secure the due protection of those in remainder, would, in substance, be performing the trust according to the intention of the testator." 2. The interest of a cestui que trust (save only in the case of a married woman during her coverture) cannot be made inalienable (d ), except by means of a shifting clause giving it over, or practically giving it over, to some other person upon alienation (e) ; in which case, the real interest of the cestui que trust is merely contingent. The contingency upon which it ceases being an attempt at {d) Snowdon v. Hales, 6 Sim. (e) See Oldham v. Oldham, L. 524 ; Green v. Spiccr, 1 B. & M. E., 3 Eq. 404 ; Billsm v. Crofts, 395 ; Brandon v. Robinson, 18 V. L. R., 15 Eq. 314 k J?e Ai/liciii, 429 ; Hood v. Offlander, 34 B. 513. L. B., 16 Eq. bS^ix parte Em- ton, L. B., TCh.'ijiv. 145. ^ AUTHORITY OF CESTUIS QUE TllUST. 141 alienation, it follows tliat he has nothing to alien. But ■where he has an interest, and there is a mere restraint on alienation, without any new trust being raised by an attempt at alienation, the restraint is wholly nugatory. For instance, a trust to apply income for another's mainte- nance entitles him to have the income paid to him or to his alienee; for no one in remainder is injured by it (/). 3. Even -where a married woman who is tenant in tail for her separate use is restrained from anticipation, she can bar the entail and turn her estate into a fee simple ; for she does not thereby anticipate her interest, but only enlarges it. As was said by Sir G. Jessel, M. E., in Cooper V. Macdonald{g), "What is the meaning of the fetter? The meaning is exactly that which was expressed by the old common form of conveyancers, ' so as in nowise to deprive herself of the benefit thereof by way of anticipa- tion.' The meaning was to give the actual enjoyment to the married woman for her own benefit, not for the benefit of anybody else ; and it is absurd, it appears to me, to extend such an equitable provision as this, so as to prevent a married woman enlarging the estate tail into an estate in fee simple for her own benefit. That is not an aliena- tion so as to deprive herself of anything. . . . Why should I construe that clause against anticipation — which was in- vented by a Lord Chancellor for the benefit of a married woman — ^to her damage and injury?" Akt. 49. — The Authority of the Cesfuis que trust collec- tively/ in a special Trust. If tliere is only one cestui que trust, or several cestuis que trust all of one mind, and he or they are sui juris, the specific performance of the trust may be arrested, and the trust modified, or turned Younr/htshand v. Gishorne, ■ [g) L. E., 7 Ch. Div. 292. 1 Ooli. 400. 142 ABlimiSTKAXIOJT OF A TEUST. into a simple trust; for the eestuis que trust are in equity the absolute owners (a), save only in the case of a married woman restrained from anticipa- tion, who is during her coverture iacapable of deal- ing with her interest (J). Illust. — 1. Thus ■where a testator gave his residuary personal estate to J. J., an infant, and directed his executors to place it out at interest to accumulate, and to pay the principal to the infant on his attaining twenty-four, and in the meantime to allow 60?. a year for his maintenance, and the testator gave the residue over on the infant's dying under twenty-one; the court held that the residue was absolutely given to the infant on his attaining twenty- one, and that, therefore, he was entitled to have the residue and accumulations at once transferred to him (c). 2. And so in Magrath v. Morehead {d), the settlor by his will directed his property to be divided into nine shares, and gave one and a half share to each of his two daughters, " to be settled on themselves at their marriage." The two daughters having attained twenty-one, and being un- married, it was held that they were entitled to their shares absolutely. 3. In Gosling v. Gosling (e), a testator by codicil, after devising an estate in Surrey to his trustees, upon trust for certain persons, concluded as follows : " It is my particular desire, that no one shall be put in possession of my estate, or shall enjoy the rent, dividends and profits of any part thereof, or of any property left by my wiE. or codicil, untU he shall attain the age of twenty-five years; and in the meantime the rents, dividends, and profits to accumulate." A devisee claimed to have the estate transferred to him before attaining twenty-five, and Vice-Chancellor Page "Wood said : " The principle of this court has always been [a) Lew. 569, and see oases Art. 48, n. (J), quoted as examples. (c) Josselyn v. Jbsseli/n, 9 Sim. 63. (i) Stanley v. Stanley, L. B., 7 (d) L. E., 12 Eq. 491. Ch. Div. 589; and cases cited «!/;;. (c) Johns. 265. AUTHOEITY OF CESTUIS QUE TllUST. 143 to recognize the right of all persons who attain the age of twenty-one to enter upon the absolute use and enjoyment of the property given to them by a will, notwithstanding any directions by the testator to the effect that they are not to enjoy it until a later age, unless, during the interval, the property is given for the benefit of another. If the property is once theirs, it is useless for the testator to attempt to impose any fetter upon their enjoyment of it in full, so soon as they attain twenty-one. And upon that principle, unless there is in the will, or in some codicil to it, a clear indication of ■ an intention on the part of the testator, not only that his devisees are not to have the en- joyment of the property he has devised to them, until they attain twenty-five, but that some other person is to have that enjoyment, or unless the property is so clearly taken away from the devisees up to the time of their attaining twenty-five, as to induce the court to hold that, as to the previous rents and profits, there has been an intestacy, the court does not hesitate to strike out of the will any direction that the devisees shall not enjoy it in full until they attain the age of twenty-five years." The learned Yice-Ohancellor therefore allowed the plaintiff's claim. 4. Again, in Re Broivn {/) there was a bequest of consols in trust to purchase a life annuity for a lady, to be held for her separate use without power of anticipation ; and in case of her illness or incapacity, the testator gave the trustees a discretionary power as to the application of the annuity for her maintenance. The legatee behiff immarried, and the restraint on anticipation being therefore nugatory, it was held that she was entitled to a transfer of the consols {g). 5. A similar result foUows where the legatee, restrained (/) 27 B. 324. T. Fulla; 26 B. 99 ; Sarton v. Iff) See also Tullett v. Arm- Briscoe, Jac. 603 ; Ro Gaffee, 1 strong, 4 M. & 0. 377; Suttan- M. & O. 547; Re Liny ee, 23 B. i/ifflw V. ifarfJM, Johns. 89 ; Wright 241. V. Wright, 2 J. & H. 655 ; Cooho 144 ADiimisTEATiON or a teust. from anticipating, becomes discovert afterwards (A), or is divorced, or about to be divorced («), or has a protection order under 20 & 21 Vict. c. 85 (/c), and a fortiori wbere she is judicially separated by a magistrate's order under 41 Vict. 0. 19, s. 4. 6. So where a testatrix gave a sum of 20,000Z. stock, to be laid out by the trustees of her will in the purchase of a government annuity, in the name and for the benefit of her godson for the term of his natural life, and directed that the annuitant should not be entitled to have the value of his annuity in Ueu thereof, and that if he should sell it, it should cease, and form part of her residuary estate, it was held that the annuitant was absolutely entitled to the annuity, and that he could make a good title to it to a purchaser (l). 7. On similar principles, where an estate is directed to be sold and the proceeds to be divided amongst several persons, no one singly can elect that his own share shall not be disposed of, but shall remain realty (to); for the other undivided shares would not sell so beneficially; but if aU. of them agree to take the land unconverted, they can insist upon their right to do so (»). (/j) Buttanshaw v. Martin, sup. {m) Lew. 784; BolhuiayY. Rad- ii) Se Linyec, sup. oliffe, 23 B. 163. (/c) Cooke T. Fuller, sup. («) Sarcourty. Seymour, 2 Sim., {1} Sunt v. Foulston, L. E., 3 N. S. 45 ; Cookson y. Eeay, 5 B. Ch. DiT. 285. 22 ; I)i.-con v. Gayfere, 17 B. 433. AUTHOEITY OF SimTITING TEUSTEES. 145 SUB-DIVISION VI. The Death, Eetieement, or Ebmoval of a Trustee, AND THE effect THEREOF IN RELATION TO THE Office of Trustee. Art. 50. — Survivorship of the Authority and Powers of the Trustees. Upon the death of a trustee, the office, as well as the estate, survives to the remaining trustees (a) ; and notwithstanding that there is a power for the appointment of new trustees (6), the survivors can carry out the trust and exercise all such powers as are necessary for the carrying out of the trust (c), unless there be something in the settlement which specially manifests an intention to the contrary (cl). Illtjst. — Thus where there was a devise and bequest of freehold and other property, and all other the testator's real and personal estate to two persons, their executors and administrators, upon trust, by sale or otherwise at theu' discretion, to raise and invest a certain sum of money and apply the interest as therein directed, and one of the trustees died, and the other proceeded to sell the estate; it was held, on an objection to the title, that the surviving trustee might exercise the option of selling and the power of sale; and the Vice-Chanoellor said: "The argument pro- eeeds, as it appears to me, on an entire disregard of the distinction between powers and trusts. No doubt where it (a) Wariurton v. Sandys, 14 bury, sup. ; Re Coolce's Contract, Sim. 622 ; Ei/re v. Countess of L. K., 4 Ch. Div. 454. -'i ;'- sC. ^ ^ . . Sliaftesburtj, 2 P. W. 121—124. (d) Foley v. Wortner, 2 J. & W. {b) WarburtoH v. Sandys, sup. 245 ; and see Jacob t. Lucas, 1 B. {c) lane v. Debenham, 11 Ha. 436. 188; Eyre v. Countess of Shaftes- 146 ADSirfTISTEATION OF A TKUST. is a naked power given to two persons, tliat will not survive to one of tliem unless tliere be express words or a necessary implication. . . . When, on the other hand, a testator gives his property, not to one party subject to a power in others, but to trustees upon special trusts, with a direction to carry his purposes into effect, it is the duty of the trus- tee to execute the triist. If an estate be devised to A. and B. upon trust to seU., and thereby raise such a sum, it is, I think, a novel argument, that after A.'s death B. cannot sell the estate and execute the trust" (e). Art. 51. — Devolution of the Office of Executive Trustee on Death of the last Survivor. Upon the death of a last surviving trustee, intestate as to the trust estate, it depends upon the language of the settlement whether his heir or personal representative, as the case may be, can execute a special trust. If it is to be collected from the settlement that the office was intended to be a personal one, it does not devolve on the heir or personal representative. If, on the other hand, the trust is directed to be performed by the trustee, his heirs, executors, S^c, it will devolve on those per- sons. Illtist. — 1. .Thus where the settlor gives personal pro- perty to A. B. upon certain trusts, then upon the death of A. B., although the estate vests in his executor, the latter wiU be unable to execute the trusts; for, as was said by Lord Cottenham in llortimer v. Ireland {a), "whether the property is real or personal is no matter; for suppose a man appoints a trustee of real and personal estate simpli- citer, adding nothing more, this cannot make his repre- sentative a trustee. . . . The property may vest in the (e) Zane y. Dehmham, sup.; and (o) H Jur. 721. Sc Coolco's Contract, svp. DEVISE OE THE TRUST. 147 representative, but tliat is quite another question from his being trustee." 2. But where leaseholds were assigned to two trustees, their executors and administrators, then upon the death of the survivor, his executors or administrators can carry out the trust, unless (it is said) he has himseH expressly or impliedly forbidden the doing so, as by bequeathing the leaseholds to another, and so going out of his way to X^revent them devolving upon the executors or administra- tors {z). AsT. 52. — Devise of the Office of Trustee. When a last surviving executive trustee devises the trust property, the devisee can only execute the trust if it was by the settlement confided to the trustees and their assigns (a). In the absence of these words, new trustees must be appointed (b) . Illust. — 1 . Thus if the settlor vest the trust property in A. and his heirs, upon trust that A. and his heirs shall sell, and A. dies and devises the trust property to B., new trus- tees must be appointed to carry out the sale; for B. cannot sell, inasmuch as there was no power given by the settle- ment to A.'s assigns to carry out the trust; and A.'s heir cannot sell, because by devising the estate to B., A. de- prived him of the character of heir (c). 2. And so again, where {d) personalty was assigned to trustees, their executors and administrators, in trust, and the surviving trustee bequeathed it to A. and B., and appointed A., B. and 0. his executors, it was held that A. and B. could not execute the trust, for the trustee had no power to bequeath it; nor could A., B. and 0. as executors (z) See per Kindersley, V.-C, 425 ; Salowayy. Strawhridge, 1 K. Re Burtt, 1 Dr. 319. & J. 371. («) Mall V. May, 3 K. & J. (5) See Ue Burtt, 1 Dr. 319. 585; Titley Y. Wolstenholme,1 'B. {c) Cook y .Craioford, \Z Bvm.. ^1. [d) Se Burtt, sup. L 2 148 ABMINISTEATION OP A TBTJST. execute it, for by beqiieatlimg the property to A. and B. alone, tlie trustee had deprived his executors of the trust. It is suggested that where real property is vested in one and his heirs, upon trust that he and his executors carry out certain directions, and the trustee devises it to another, such devise, although nugatory, would not deprive the exe- cutors of the trust; for it would not deprive them of the estate, which would, in the absence of the devise, have descended to the heir and not devolved upon them. 3. "Where the trust property was confided to a trustee, his heirs and assigns, it was held, that although the settle- ment contained a power to appoint new trustees, the word assigns might reasonably be construed to give the trustee a discretionary power of preventing the inconvenience which might attend the devolution of the trust upon his heir {z). Art. 53. — JRetiretnent and Removal of a Trustee. Where the settlement contains no power to appoint new trustees, and it is dated before the 28th day of August, 1860 (ff), a trustee can only be dis- charged from his office — a. With the consent of himself and all his cestuis que trust, who must, in order to give a valid con- sent, be sui juris ih) ; or /3. By the court, which wOl act at the instance of the trustee, or at the instance of any of the cestuis que trust where the trustee has behaved improperly (c) , or is incapable of acting properly {d) , or is a felon (e), or a bankrupt (/), or is residing [z) Hall v. May, sup. ; see Mr. (i) Wilkinson v. Farry, 4 Euss. Lewiu's observations on this case, 276. Trusts, 204. («) Millard v. Eyre, 2 V. 94 ; («) Lord Cranworth's Act, 23 Faliaret v. Careir, 32 B. 567. & 24 Vict. c. 145, s. 37, which (d) Bitchanan v. Samilton, 5 V. implies a power to appoint new 722. trustees in settlements executed (e) 15 cfe 10 Vict. u. 65, s. 32. after the 28th August, 1860. (/) 32 & 33 Vict. c. 71, s. 32; Me Barker, L. K., 1 Ch. Div. 43. EETIEEMEM'T ANB EEMOVAL OF TETJSTEES. 149 abroad {g), or cannot be beard of {h). And tbe court can discharge an old trustee without neces- sarily appelating a new one in his place, if it be difficult or impossible to do so («). The costs of the application wUl come out of the estate if the trustee is justified in retiring {k), or where the removal is not caused by impropriety on his part. Illust. — The only points in this article which need illustration are the circumstances which wiU justify a trustee in retiring. In Forshaw v. Iligginson (J), the late Master of the Eolls said : " It is quite settled that a trustee cannot from mere caprice retire from the performance of his trust without paying the costs occasioned by that act ; it is also quite clear, that any circumstances arising in the administration of the trust which have altered the nature of his duties justify him in leaving it, and entitle him to receive his costs; hut I think that to justify him in that course the circumstances must be such as arise out of the administration of the trust, and not those relating to himself individually. Here the circumstances which in my opinion justify his saying, ' I cannot proceed with the administra- tion of the trust with my co-trustee,' arose out of his private circumstances, not out of the administration of the trust. If, therefore, on the application of the trustee to be discharged, the cestuis que trust had 'said, ' You must pay the cost of the appointment of new trustees,' which would have been the mere cost of an indorsement on a deed, and he had refused to do this, I should not have supported him in instituting a suit by giving him the costs thereby occasioned. But that is not the present case No person can he compelled to remain a trustee and act in the {g) Buchanan v. Hamilton, sup.; (i) Coventry v. Coventry, 1 Kee. Me BiffnoM, L. K., 7 Ch. 223.4h, 758 ; Greenwood ^.Vakeford, 1 B. (A) Re Harrison, 22 L. J., Ch.j 581; Forshaw t. Higginson, 20 B. 69. / 485 ; Be Stokes, stip. ; and see (() Me Stokes, L. E., 13 Eq. 33^ Barker v. Feile, 2 Dr. & S. 340. [1) Supra. 150 ADMINISTEATION OF A TKrST. execution of the trust. As already stated, if the circum- stances preventing his continuing to perform his duties arose from any act of his own, or anything relating to himself, I think he ought to pay the costs of the appoint- ment of a new trustee; hut if the persons upon whom the appointment of a new trustee depends absolutely refuse to take steps for that purpose, what is he to do ? In my opinion, the only course he could take was to say what every trustee may say, ' I will apply to, and have the trust executed by the court, and I will ask to be discharged from the trusts as incidental to that relief.' " Aet. 54. — Appointment ofneio Trustees hy the Court. Whenever it is expedient to appoint a trustee or trustees, whether of a settlement of "which, no trustees were originally appointed {a), or the ori- ginal trustees of which have died, retired, or been removed, and it is found inexpedient, difficult, or impracticable to do so without the assistance of the court, the court may appoint such a trustee or trus- tees (6), and may, by order, vest in such new trus- tees or trustee any lands (c) subject to the trust {d), and the right to call for the transfer of any stock, or to receive the dividends thereof, and the right to sue for and recover any chose in action, or any interest in respect thereof {e). Aet. 55. — Express Power to ajijwint new Trustees. Where there is an express power to appoint new trustees contained in the settlement (and such a («) Sodldn Y. Bmnt, L. E., 6 (c) Qusere, leaseholds; see He Eq. 580; ICAdhcmarY.Bertrand, Mundcl, 6 Jur., N. S. 8S0, and 35 B. 19 ; and see 15 & 16 Vict. Re Robiiison, 9 Jur., N. S. 885. c. 55, s. 9. {d) 13 & 14 Vict. c. 60, s. 34. (b) 13 & 14 Vict. c. 60, ss. 32, (e) lb., s. 35. 33. APPOINTMENT OF NETT TRUSTEES. 151 power is implied in every settlement executed since the 28th August, 1860 [a), such a power must be executed strictly (b). But unless there clearly appears to be an intention to the contrary (c), the original number of tmstees may be increased or diminished (f?). Illtjst. — 1. Thus, where the power was vested in "the surviving or continuing trustees or trustee, or the heirs, executors, or administrators of the last surviving and con- tinuing trustee," and the two trustees were desirous of retiring, it was held that they could not do so by appoint- ing two new trustees in their place by one deed, but that one mxist appoint a new trustee in the place of the first retiring trustee, and then the new trustee must appoint one in the place of the second retiring trustee («). This case is a singular instance of that verbal suhtlety which makes men of the world so distrustful of legal interpreta- tion. It all turned upon the idea, that trustees who were about to retire could not be said to be continuing, but that if one retired first, the other would be a continuing trustee, although he might intend to retu-e the next day. If, in addition to the words "surviving and continuing," the words " or other trustee or trustees" had been added, the two retiring trustees might have appointed two new ones by the same deed (/). 2. So again, the words "unfit and incapable" are very strictly construed. Thus, where a new trustee was to be appointed if a trustee became incapable of acting, it was held that the bankruptcy of one of the trustees did not fulfil the condition, as it only rendered him unjit but not (a) 23 & 24 Vict. c. 145, a. 27. CoU. 335 ; Millar v. Priddm, 1 ib) See Stones t. Rowton, 17 B. D., M. & a. 335 ; Re Bathurst, 2 30. S. & G. 169. (o) See Bmmett v. Clarke, 3 Gif. {e) Stones t. Rowton, sup.; but 32 ; Lord Lonsdale v. Beclcett, 4 D. comp. Cafe v. Bent, 5 Ha. 24. & J. 255. (/) Lord Camoys v. Best, 19 B. (d) Meinertzhagen v. Davis, 1 414. 152 ABMIITISTEATION OP A TEtTST. incapable (g). And so Trliere the ■n'ords -were "unable to act," it was held that absence in China or Australia did not disable (A), although it clearly unfitted (?) a trustee for the oifiee. (ff) Turner \. Maule, 15 Jur. («) Mennard v. Welford, 1 Sm. 761 ; see Se Watts, 9 Ha. 106. & a. 426. A mere temporary (h) Withington t. Wiihington, absence atroad would not unfit a 16 Sim. 104; Re Sarrism, 22 L. trustee for the office. Ee Moravia J., Ch. 69 ; but see Re Bifjnold, Society, 4 Jur., N. S. 703. L. E., 7 Ch. 223. EEIMBUESEMENT OF TRUSTEES. 153 SUB-DIVISION VII. The Protection and Relief accorded to Trustees. Art. 56. — Reimbursement of Exixiises. "Whether the settlement provides for the reimbui'se- ment of the trustee's expenses or not, he is entitled to he reimhiirsed all expenses which he has properly paid or incurred in the execution of the trust (fl) ; and until they are paid he has a lien for them on the trust property (J). The question as to what expenses are, and what are not, properly incurred, depends upon the circumstances of each particular case (o). Illitst. — 1. Thus, in Bennett v. Wyndham{d), a trustee in the due execution of his trust directed a bailiff employed on the trust property to have certain trees felled. The bailiff ordered the ■wood-cutters usually employed on the property to fell the trees, in doing which they negligently allowed a bough to fall on to a passer-by, who, being injured, recovered heavy damag^es from the trustee in a court of law. These damages were, however, allowed to the trustee out of the trust property, the Lord Justice Knight Bruce saying : " The trustee in this case seems to have meant well, to have acted with due dihgenoe, and to have employed a proper agent to do an act, the directing which to be done was within the due discharge of his duty. The agent makes a mistake, the consequences of which subject the trustee to legal liability to a third party. I am [a) Worral v. Barford, 8 V. 8; M. & Gr. 19 ; and see Walters v. Morrison T. Morrison, 4 K. & J. Woodhridge,Jj.'R., 7Ch. Div. 504. 458. (c) Leedham v. Chawner, 4 K. [b) Sx parte Jams, 1 D. & C. & J. 458. 272; Ex parte Chippendale, 4 D., {d) 4 D., F. & J. 259. 154 ADMINISTRATION OF A TRUST. of opimon that tliis liability ougM, as between the trustee and tbe estate, to be borne by the estate." 2. So again, a trustee or executor -will be allowed the amount of a solicitor's bill of costs which he has paid for services rendered in the matter of the trust (e). 3. But where a receiver (who is, of course, a constructive trustee) made several journeys to Paris, in order that he might be present at the hearing of a suit brought in the French courts in relation to the trust property, and it ap- peared that his presence was wholly needless, the whole question being one of Prench law, and not of fact, his travelling expenses were disallowed, on the ground that they were under the circumstances improperly incurred (y). 4. And so where trustees attempted, at the solicitation of their cestuis que trust, some of whom were married ivomen without power of anticipation, to sell the trust property before the date named in the settlement, it was held that they were not entitled to be indemnified against the costs of an action for specific performance brought against them by the purchaser {g). Art. 57. — Protection against the Acts of Co-trustee. A trustee is not answerable for the receipts, acts, or defaults of his co-trustee {a) , save only : — a. Where he has handed the trust property to him without seeing to its proper application. /S. Where he allows Mm to receive the trust property without making due inquiry as to his dealing with it. y. Where he becomes aware of a breach of trust, either committed or meditated, and abstains from taking the needful steps to obtain restitution and redress, or to prevent the meditated wrong. [e] Macnamara v. Jones, Dick. (ff) Lccdham v. Chawncr, stip. 587. {a) Dawson v. Clctrh; 18 V. (/) Malcolm v. O'Callaffhan, 3 254; and as to settlements made M. & C. 62. since, see 22 & 23 Vict. o. 35, 8. 31. LIABILITY rOE. CO-TRtrSTEE. 155 And even in tHese three cases he may, by express declaration in the settlement, be made irrespon- sible (5). • Illttst. — Thus in the case of Wilhins v. Hogg (c), -wliich now governs the subject, a testatrix, after appointing three trustees, declared that each of them should be answerable only for losses arising from his own default and not for involuntary acts or for the acts or defaults of his co-trustees, and particularly that any trustee who shpuld pay over to his co-trustees, or should do or concur in any act enabling his co-trustees to receive any monies for the general purposes of her will, shoidd not be obliged to see to the due application thereof, nor should such trustee be subsequently rendered liable by any express notice or inti- mation of the actual misapplication of the same monies. The three trustees joined in signing and giving receipts to two insurance companies for two sums of money paid by them, but two of the trustees permitted their co-trustee to obtain the money without ascertaining whether he had invested it. This trustee having misapplied it, it was sought to make his co-trustees responsible, but Lord Westbury held that they were not; saying, "There are three modes in which a trustee would become liable according to the ordinary rules of law — first, where, being the recipient, he hands over the money without securing its due apphcation ; secondly, where he allows a co-trustee to receive money without making due inquiry as to his dealing with it; and thirdly, where he becomes aware of a breach of trust, either committed or meditated, and abstains from taking the needful steps to obtain restitution or redress. The framer of the clause under examination knew these thi-ee rules, and used words sufficient to meet all these cases. (i) As to the wliole of the ar- also Diz v. Burford, 19 B. 409; ticle, see judgment of Westbury, Miicldow\. Fuller, 32iC.WS; Brum- L.' C, in Wilkins v. ITot/i^, 3 Gift. ridge v. Brumridgc, 27 B. 5. 116; 8 Jut., N. S. 25; and see (c) Supra. 156 ADMINISTEATION OF A TETJST. There remained therefore only personal misconduct, in respect of which a trustee acting under this ■^'01 would be responsible. He would stiE. be answerable for collusion if he handed over trust money to his co-trustee with reasonable ground for believing or suspicion that that trustee would commit a breach of trust ; but no such case as this was made by the bill." Akt. 58. — Trustee uithout Notice not hound to pay to Persons claiming through Cestui que trust. If the person who is really entitled to trust property is not the cestui que trust who appears on the face of the settlement, but some one who claims through him, and the trustees, having neither express nor constructive notice of such derivative title, pay upon the footing of the original title, they cannot be made to pay over again (a). Illust. — Thus, in Leslie v. Baillie (5), a testator, who died and whose will was proved in England, bequeathed a legacy to a married woman, whose domicile, as well as that of her husband, was in Scotland. The husband died a few months after the testator, without having received the legacy. After his decease the executors of the testator, with knowledge of the before-mentioned circumstances of domicile, paid the legacy to the widow. It was proved that, according to the Scotch law, the payment should have been made to the hiisband's personal representatives. It was however held, that in the absence of proof that the executors of the settlor knew the Scotch law on the subject, the payment to the widow was a good payment. (a) Lew. 579; Cothay v. Syden- Baillie, 2 T. & C. C. 91. ham, 2 B. C. 0. 391; Leslie y. (b) Supra. CONCUESENCE OF CESTUIS QUE TRUST. 157 Art. 59. — Concurrence of or Release hy the Cestuis que trust. A cestui que trust who has assented to or concurred in a breach of trust (a), or who has subsequently- released or confirmed it(6), cannot afterwards charge the trustees with it : Provided — a. That the cestui que trust was sui juris at the date of such assent or release (c) ; /3. That he had full knowledge of the facts and knew what he was doing {d), and the legal effect thereof (e) ; y. That no undue influence was brought to bear upon him in order to extort the assent or re- lease (/). A cestui que trust, however, who is not sui juris, and who concurs in a breach of trust, may bind himself from afterwards charging the trustees if he employ fraud (•). A settle- (o) StanUij V. Stanley, L. E., 7 (?) 3 B. 563. Ch. Div. 589. .? ' (?■) Stanley v. Stanley, sup. (^) Supra. 160 ADMINISTEATIOK- OF A TEUST. ment -was made on the marriage of a female infant, whereby the husband covenanted to induce her to settle her real estate upon attaining twenty-one, and to concur in such settlement himself. He neglected to do so how- ever, and they subsequently mortgaged the real estate, but the mortgagee had no notice of the covenant until just before the deed was acknowledged. It was held, that the wife's fraud in not disclosing the existence of the settle- ment bound her estate, and bound her not to consent to the settlement which the husband had covenanted that he would induce her to settle (s). Art. 60. — Laches of the Cestuis que trust when a bar to Relief. The Statutes of Limitation do not apply to declared trusts («) (except where they are created by way of a charge on real estate, unconnected with a duty {b) ), nor to trusts which on the face of a written instrument are resultiag trusts (c), although they are applicable to other constructive trusts {d) ; but in taking an account for the purpose of charging a trustee with personal liability, every fair allowance ought to be made ia his favour if it can be shown that he acted bona fide, and that the claim sought to be enforced is one which arose many years ago, and one of the nature and particulars of which the cestuis que trust was, at the time when it arose, perfectly cognizant {e). Illust. — 1. If land be devised to a person upon trust to receive the rents and thereout to pay certain amniities, the surplus rents result to the heir-at-law upon the face of (s) Sharp v. Foy, L. E., 4 Ch. [d) Beckfordv. Wade, 17 V. 97; 85; and see Ee Lush, ibid. 591. Fetre v. Fetre, 1 Dr. 371. (a) 3 & 4 WiU. i, 0. 27, ». 25. («) See per Westbury, L. C, (b) lb. B. 40. mMeSonneUv. White, 11 H. L. C. (c) Lew. 719; Salter v. Cara- 670; ThompsoiiY. I!astu'ood,Jj.H., iiai/h, 1 Br. &W.66S; Mutl-owv. 2 Ap. Ca. 215. '"■"-,'■■-",',-.• i?W, L. R., 18 Eq. 246. '^ -/, , >, , LACHES OF CESTUIS QUE TEUST. 161 the instrmnent, and the heir-at-law is therefore not statute barred by any length of possession of the trustee {/)■ 2. But a resulting or other constructive trust, depending upon evidence dehors the -written instrument, is within the statute {g) ; and so a tenant for life of leaseholds who renews in his own. name (A), or a mortgagee in possession (even though the mortgage is in the form of a trust) («' ), is en- titled to the benefit of the statute. 3. Simple charges are, however, expressly provided for by the statutes (/;). Where, however, a charge is so coupled with a trust as to be in reality a trust itself, the statutes do not apply. For instance, where a testator charges his property with payment of his debts, and im- poses an obligation on the devisee to exert himself actively in paying the debts, the case will not fall within the statutes (Z). 4. An estate is devised to A. and his heirs, charged with the payment of 500^. to B. and 0. upon certain trusts. Here, as between A. and the two trustees, there is a mere charge; but as between the trustees and their cestuis que trust there is a trust (»i). 5. As has been stated, even a cestui que trust of a de- clared trust may disentitle himself to relief by great laches. Thus A., being greatly in debt, executed a deed of trust for the benefit of his creditors, and among the property was the benefit of a lease for lives, renewable for ever, on which the rent reserved was a high rack rent. The tenant under this lease complained, and the trustee, with the knowledge, but without the consent, of A. (but with the consent and approbation of A.'s brother, who had the management of A.'s affairs), accepted a reduced rent. A. complained of the abatement, but took no steps to put an {/) Salter v. Cavmagh, sup. [Ic) 3 & 4 "Will. 4, c. 27, u. 40. (g) See note {d), p. 160. (I) Sunt-v. Bateman, 10 Ir. Rep. {/») Fetre v. IFetre, sup. 360. (j) Locking v. Farker, L. B., [m) Lew. 721. 6 Ch. 30. U.T. M 162 ADMINISTRATION OF A TEUST. end to it for some years. It -was held tliat after the ex- piration of the trust, the trustee could not be called upon to make up the deficiency (n). It would, however, seem that a mere knowledge, without suing for a few years, as for ten years, will not destroy the right (o), particularly where the trustee has not acted bona fide. 6. So again, in Jones v. Higgins (^j), it was declared in a marriage settlement that a sum of money, then in the hands of the lady's brother, should be held by three trustees, one of whom was the brother, upon trust at the request in writing of the lady to pay to her the whole or any part absolutely, and until such request upon trust, when and as the same should come into their hands, to invest the same and pay the interest to the wife for ILEe for her separate use, and after her decease as she should by will appoint, and in default of appointment to her hus- band. The money was allowed to remain for thirteen years in the hands of the brother, who paid the interest to the husband, and also paid him part of the principal, with the wife's hioivledge. The husband died, the brother became insolvent, and the wife filed a bOl against the trustees ; but it was held, that although the trustees had been guilty of a breach of trust, the wife was debarred from relief on aocoimt of her long acquiescence. 7. So, wherever it is for the general convenience that a. suit in respect of a long dormant grievance shoidd be dis- allowed, the court will refuse relief on the ground that " Expedit reipubhcas ut sit finis litium" (j). For instance, where a plaintiff seeks to set aside a purchase from him by his solicitor, a delay of less than twenty years may bar the right to relief, if it would be inconvenient to grant it (r) ; or where, in an action for an account, the plaintiff by lying by has rendered it impossible or gTeatly incou- (n) McJDonncl v. White, sup. (g) Lew. 715. (o) L. E., 2 Eq. 538. (»■) Gresleij v. Mouslcy, 4 D. & (p) Tarrant t. Mlancliford, 11 J. 78. W. B. 178. GArCTEE, BY BREACH MUST EECOTJP TBtTSTEE. 163 venient for the defendant to render the account he calls for, he will get no relief (s). Aet. 61. — The Gainer hy a Breach of Trust must pro tanto indemnifu Trustee. As between tlie trustees and a third person who has reaped the benefit of a breach of trust, the latter must indemnify the former to the extent of the property actually received by him under the breach of trust (a) ; and where he is a cestui que trust the trustees will have a lien on his share for such amount (6). iLLtrsT. 1. — Thus, xjersonalty was bequeathed upon trust for tenants for life, with executory trusts in remainder, but without directions as to investment. The trustees, at the instance of the tenants for life, invested on mortgage of a precarious nature, in consequence of which the tenants for life received a far larger income ; but the corpus of the estate was in the result greatly depreciated. The trustees having been ordered to refund the loss to the trust pro- perty, claimed to be generally indemnified by the tenants for life who had reaped the benefit of the breach; and their claim was allowed, but only to the extent of the property actually received by the trustees in consequence of the im- proper investment (c). 2. And so, if the trustees by mistake pay capital to the tenant for life, instead of income, they must of course make the loss good to the trust property ; but they will, never- (s). See per Lord Alvanley, in Montford v. lord Cadogan, 19 V. jPickering v. Stamford, 2 V. 272 ; 639 ; Browne. Maunsell, 5 Ir. Ch. and see also Olegg v. Edmonston, 3 E. 351 ; Walsham v. Stainton, 1 Jur., N. S. 299; Tatam v. TFil- H. & M. 337. Hams, 3 Ha. 347. (J) Frime v. Savell, W. N. (a) Lew. 744 ; Ealii/ v. Side' 1867, p. 227 ; Lew. 746. halgh, 7 D. M. & G. 108 ; Traf- (c) Maly y. Hidehalgh, sup. ford Y. Boehm, 3 Atk. 440 ; Lord M 2 164 ADSriNISTEATIOH- OF A TEITST. theless, he entitled to be recouped out of tlie life in- terest {x). Art. 62. — Trustee has a Right to Discharge on Completion of his Duties. Upon the completion of the trust a trustee is en- titled to have his accounts examined and settled by the cestuis que trust, and either to have a formal discharge given to him or to have the accounts taken in court. He cannot, however, demand a release imder seal {y). Illtjst. — Thus, a trustee on finally transferring stock to a cestui qtie trust demanded from the latter a deed of release. The cestui que trust, hoivever, refused to give him anything except a simple receipt for the amount of stock actually transferred, which, of course, left it open to him. to say that that amount was not the amount to which he was entitled. The court held, that no deed was de- mandable; the Vice- Chancellor saying: "But though it may not have been the right of the trustee to require a deed, I think that it was his right to require that his account should be settled; that is to say, that he and his family should be delivered irom the anxiety and misery attending unsettled accounts, and the possible ruin, which they who are acquainted with the affairs daily litigated in the Court of Chancery well know to be a frequent result of neglect in such a matter. . . . He was boiand to give an account if demanded, but giving the accounts he was entitled (to use a familiar phrase) to have them wound up. It is true that the accounts, though settled, might be liable to be surcharged and falsified. That might or might not be, but still the trustee had a right to have his accounts gone through, executed, and settled If the plaintiff was satisfied upon the accounts as sent in [x] See Barratt v. Wyatt, 30 (y) Chatley v. Seatkij, 2 Coll. B. 442 ; Dmks v. Hodgson, 25 B. 137 ; Se Wright, 3 K. & J. 421. 177 ; Griffiths V. Forter, ib. 236. ADVICE OP A JUDGE. 165 that notHng more was coming to Mm, lie sIlouM have ex- pressed Ms ■willingness to close the account. On the other hand, if he was dissatisfied with it, he should have asked to have the account taken " (~). Aet. 63. — Advice of a Judge. A trustee may apply, by petition («), to any judge of the Chancery Division of the High Court of Justice, for his opinion, advice, or direction on any such present (b) questions respecting the exercise of his discretion and the management of the trust pro- perty as are of minor importance (c) and do not include questions of detail, difficulty (d), or con- struction (e) . The petition must be served on all such parties interested (or all such parties must attend the hearing) ^ as the judge shall deem expe- dient. A trustee, bona fide stating the facts in such a petition, is indemnified against any loss which may occur from following the advice or direction givenby the judge (/). Illust. — 1. The court will, upon su.ch a petition, give advico as to investments {(/), payment of debts (/*), the propriety of the trustees consenting to a sale («'), the ad- vancement of money for maintenance or repairs (/o), as to leasing the trust property {I), and other matters of a like character. (z) ChadwiclcY. BcatUy, Slip. 3Iarshx.Atf.-Gen.,2 3.k'B..Q\. (a) The aet gave the alterna- (c) Re Evans, 30 B. 232 ; Es tive of summons, but the court Muggcndge, sup.; He Sooper, 29 has decided that the application B. 657 ; but see Se Teyton, 10 ought to be made on petition, Tie W. E. 515. Dennis, 5 Jur., N. S. 1383. (/) 22 & 23 Vict. c. 35, s. 30. ill) 11 & 23 Vict. c. 35, s. 30 ; {;/) Be Lorentz, 1 Dr. & S. 401; Jie Box, 1 H. & M. 552 ; 11 W. E. Me Kmwles, 18 L. T., N. S. 809. 945. (A) Ee Box, sup. (c) Lew. 443; jRe Muggeridge, (J) Earl Pauletty. Hood, Jj.lR,., Johns. 15 ; Ee Mockett, id. 628 ; 5 Eq. 115. Ee Spiller, 8 W. E. 333 ; Ee (i) Ee Sotham, L. E., 12 Eq. Jacob, 9 W. E. 474. 76; Cuthbertsonv. Wood, 19W.E. id) Ee Barrington, 1 J. & H. 265. 142; but see Ee Mockett, sup.; [I) Es Shaw, ib. 125. 1G6 ADMINISTEATION OF A TRUST. 2. But where trustees were authorized to invest trust monies in the purchase of lands, and they presented a petition asking the court for its advice as to the application of a further portion of the trust monies to the permanent improvement of the lands, the court, not having the requi- site machinery for investigating the details, refused to give any advice (in). 3. Where the case is hypothetical, and not present, — as, for instance, where the question asked was as to the inci- dence of future calls which might be made on account of shares bequeathed — the court will give no advice, and wHL order the petition to stand over until the event happens (n). Art. 64. — Craving the administrative Assistance of the Court. Trustees (o) may relieve themselves of responsibility in the following cases, and to the following extent : a. Where the trust property consists of money, or annuities, or stocks standing in their names at the Bank of England, or in the East India Company, or the South Sea Company, or in any government or parliamentary securities, the trustees, or the majority («) of them, may, on filing an affidavit shortly describing the settlement according to the best of their know- ledge and belief, and with the privity of the joaymaster-general of the Chancery Division of the High Court, pay such money into the said bank to the account of the said paymaster- general, in the matter of the particular trust, or transfer or deposit such stocks or secxmties into or in the name of such paymaster-general, [m) Me Barrington, 1 J. & H. of the Judicature Act, 1873, ttese 142; JRe Simson, 1 J. & H. 89 ; provisions are extended to all con- Marsh v. Att.-Gen., sup. structive trustees, such as insur- (n) lie Box, sup, ance companies, &c. ; see Se Hay- (o) It would seem that by the cock, L. E,., 1 Ch. Div. 611. operationof sub-sect. 6 of sect. 25 («) 12 & 13 Viet. c. 74, PAYMENT INTO COTJET AND SUIT. 167 to attend the orders of the court. The receipt of one of the cashiers of the said bank for money, or, in the case of stocks or securities, the certificate of the proper officer, that they have been transferred or deposited, is a suffi- cient discharge to the trustees (5), who are thereby released from seeing to the future ap- plication of that particular fund, but are not released from the office of trustee (c) ; l3. Where the trust property is not of the kind aforesaid, or where the trustee wishes to be discharged from the office of trustee, he may institute a suit for the administration of the trust by the com't (d). Provided that where the equities are perfectly clear and unambiguous (e), or he merely craves to be released from caprice or laziness, or is otherwise not justified in the course he has pursued (/), he will have to pay all the costs ; and even where he acts bona fide, but without any real cause, he will not be allowed his own costs {g) . And where he brings a suit, when the same object might have been ob- tained by payment into the bank, ho will not be allowed the extra costs occasioned thereby (A) ; and he will always appeal from an order of the court at his own risk («'). Illust. — 1 . The only part of the article wMch requires iUustratiug is the proviso. A trustee is justified in paying (A) Trustee Relief Act, 10 & U L. E., 7 Eq. 194; He Hoskins, Viot. c. 96, s. 1. L. E., 5 Ch. Div. 229. 2 '■ : ---^^ . (c) Barker v. I'eile, 2 Dr. & S. (/) Forshaw v. Hiffffinson, 20 340 ; JRe Coo's Trusts, i K. & J. B. 485 ; Se Stokes, L. E,., 13 Eq; 199 ; Se Williams's Trusts, ib. 87; 333. Be Bailey's Trusts, 3 W. R. 31. [g] Be Lcakc, 32 B. 135; Eo {d) Talbot V. Jiarl Radnor, 3 Seming, 3 K. & J. 40 ; Morgan's M. & 0. 252 ; Goodson v. Ellison, Ch. Acts, 68. 3 Russ. 583. (A) Wells v. Malion, 31 B. 48 ; (e) Ee Knight, 1TB. 145 ; Law- but see Smalltoood v. Eutter, 9 Ha. son V. Copeland, 2 B. C. C. 156 ; 24. Ee Elliot, L. R., 15 Eq. 194 ; Ee (i) Eowland y. Morgan, 13 Jur. Foligno, 32 B. 131 ; Be Woodburn, 23 ; Tucker v. Sorneman, 4 D. M. 1 D. & J. 333 ; Beattie v. Gurzon, & G. 395. 168 , ADMINISTEATION OP A TEUST. money into court -where lie cannot get a valid diseliarge ; as, for instance, wliere the cestuis que trust are infants (c) or lunatics {/)■ 2. So, -where under a creditor's deed money -was claimed both by the settlor and the creditors, the trustee -was held to have been justified in paying the money into court (y). 3. So, a trustee may properly pay money into court where it is claimed by the representative of a cestui que trust ; for non constat, but that the cestui que trust may have disposed of it (A). On the other hand, it has been said («') that a trustee ought not to hesitate to pay the money to a cestui que trust "who claims in default of ap- pointment, if he has good reason to believe that the po-wer has never been exercised; Jessel, M.E.., saying : "If there had been no such case as He Wylly's Trusts {7c), and no such opinion as that referred to, I should probably have made the trustees pay the costs of the transfer of the fund into court. They had no notice of any appointment by the lady, and no ground for belie-nng that any appoiatment had been made. The solicitor, -who had acted for Mrs. Cull from the time of her marriage, -wrote to say that there -was not the slightest ground for supposing that she had made any appointment. The trustees had, therefore, fullj' discharged their duty, and I am of opinion that they could not have been made liable if they had then paid over the fund to the petitioner, even if an appointment had been subsequently discovered. In the case of Se Wylly's Trusts the late Master of the EoUs said : ' The trustees had a if) lie Cmotliorne, 12 B. 56 ; Jle King v. King, 1 D. & J. 663. Beauclerlc, 11 W. E. 203; Se (i) J?e (7««, L. E., 20 Eq. 561: Cotilson, i Jut., N. S. 6 ; Ee but see and consider Re H'l/Heif, SicJiards, L. R., 8 Eq. 119. 28 B. 458. (/) He Upfidl, 3 M. & G. 281 ; {/.-) He Swan, 2 H. & M. 34 ; Me Irby, 17 B. 334. but see Re RobeHs, 17 W. E. 639 ; ig) Me Headington, 6 "W. E. 7 ; Re Bcmhjshe, 5 W. E. 816 ; Ri but see Re Moscley, 18 W. E. 126. Wi/llcti, 28 B. 458 ; Re Williams, {h) Re Lane, 24 L. T. 181 ; 4 K. & J. 87. PAYMENT INTO OOXTET AND SUIT. 169 right to satisfactory evidence that Mrs. "Wylly had made no appointment of the funds, by which I understand him to mean such evidence as a conveyancer would require : a letter from the solicitor would in such a case be quite suificient. ' " 4. Where the cestui que trust is a married woman, it has been held that the trustee may pay into court, in order that she may assert her equity to a settlement {I). 5. Again, where the trustee has a bona fide doubt as to the law (to), or has received a bona fide claim sanctioned by respectable solicitors (ra), he may properly pay the fund into coiu't. 6. But where a cestui que trust in reversion had gone to Australia, and had not been heard of for some years, sud- denly reappeared, and there was no reasonable doubt as to his identity, it was held that the trustee was not entitled to pay the trust fund into court instead of paying it over to him; Malins, V.-C, saying: "At the time when the trustees were uncertain whether he was living or dead they might with propriety have paid the money into court, but they did not do so then ; on the contrary, they retained it in their possession until they were informed that a letter had been written by him from Australia, stating that he should return home immediately, and then they insisted upon paying the money into court, notwithstanding the re- presentation made to them that they should wait until the •petitioner's arrival in England. The petitioner left Eng- land when he was twenty-six years of age, and a man does not often change so much after that age that he cannot be easily recognized, and there was every reason to suppose that his identity would be at once proved, and that would have .settled the question without expense. ... I think these proceedings were perfectly unjustifiable ; and although it (l) Ante, note {Ic), p. 168. Gunnell^. TF/iitear, 18 W. E. 883. {m) King v. King, 1 D. & J. («) Ee Maclean, L. R., 10 Eq. 663; iJe J!f«to//«,D. J. &S. 122; 282. ' /(} , 170 ABMINISTRATIOH' OP A TRUST. is clear tliat the court •will incline towards the payment of the costs of trustees when they act in a bona fide way, yet, onthe other hand, it is most important that trustees should not incur unnecessary expenses for the purpose of relieving themselves of all liability, and particularly so when there is no reasonable doubt in their way." His honor, there- fore, ordered the trustees to pay the costs of all parties (n). 7. Trustees may properly institute a suit where there is a dispute as to the interests of the cestuis que trust in real property ; as, for instance, where the settlor was tenant in tail of the property, and disentailed it by an assurance, the validity of which is disputed (o). 8. And so it was said in Goodson v. Ellison {p), that a trustee under an old trust creating successive limitations of equitable interests, some of which had failed, was entitled, before he could be required to convey, to have the equit- able title of those who called for a conveyance ascertained by inquiry, and to have the deed of conveyance settled by the proper oiHcer of the court. 9. And again, where there was a voluntary settlement, and the trust property was an ascertained and undisputed fund which might have been paid into the bank without suit, but there were divers disputes as to the proper cestuis que trust, and out of such disputes several suits had sprung, to all of which the trustee was a necessary defendant ; it was held that he was entitled to institute a suit to be relieved of the trouble and annoyance {q), V.-O. MaHns saying : " It has been contended that it can signify nothing to a trustee whether he is discharged or not, for under the Trustee Relief Act, if he paid the money into court, he would be discharged from liabihty. But, in fact, the trustee is not in that way discharged from being a trustee. (n) Se mUott, L. E., 15 Eq. (o) Talbot y. Earl Radnor, ZM. 194 ; Re Foligm, 32 B. 131 ; Ee & K. 252. Knight, 27 B. 45; S.e Woodburn, (p) 3 Rubs. 583. 1 D. & J. 333. (y) barker v. Fcile, 2 Dr. & S. 340. PATHENT INTO COITRT AND SUIT. I7l If he brings the money into court under the act, he still remains a trustee, and though he -would be under no liability quoad the fund brought in, he would not be discharged from liability quoad the past income, and, moreover, he must be served frith notice of aU proceed- ings under the act in relation to the fund, and this of necessity would compel him to incur some expense in em- ploying a solicitor ; and, moreover, it is 'within the range of possibility that the court might, under the powers given by the act, direct a suit to be instituted to determine the rights of the parties claiming the fund at some future time, to which he would be a necessary party, not having been discharged from being a trustee. I am of opinion that the Trustee Relief Act does not deprive the trustee of the right to come here and ask to be discharged, if the circumstances justify him in so doing, as they do here, and that he is, therefore, entitled to costs as between solicitor and client." 10. But where there is no dispute respecting the amount of a trust fund, and no justifiable ground for the trustee retiring from his oiRoe, the only doubt being as to the proper persons entitled ; and the trustee, instead of paying the money into court under the Trustee Relief Act, insti- tutes a suit for the purpose of having the rights of the cestuis que trust declared, he will be allowed such costs only as he would have been entitled to if he had paid the fund into court under the act (r). [r) Wells v. Mcdhon, 31 B. 48. Division IV. THE CONSEQUENCES OF A BREACH OF TRUST. SuB-Div. I. — The Llvbility op the Teusteb. Aet. 65. Loss by Breach of Trust generaJly a simple Contract Debt. ,, 66. TJie Liability where joint qua Cestuis que trust may he dis- tributable qua Trustees. 67. The Measure of the Trustees^ Responsibility. 68. Charge upon Property of the Trustee with which he has mixed the trust Property. 69. Property acquired by a Trustee out of Trust Funds becomes Trust Property. 70. No Set-off allowed to the Trustee where Breaches are distinct. 71. Cestui que trust may compel performance of Duty, or prevent commission of Breach of Trust. 72. Fraudulent Breach of Trust a Crime. SuB-Div. II. — Liability of Paeties otheb, than the Teustees. Aet. 73. Liability of Cestuis que trust icho isjiarty to a Breach of Trust. „ "li. Liability of third Parties privy to a fraudulent Breach of Trust. „ 75. Following Trust Property into the hands of third Parties. ,, 76. Liability of Persons paying Money burdened icith a Trust to see to its application. ( 1'3 ) SUB-DIVISION I. The Liability of the Trustee. Art. 65. — Loss by Breach of Trust generally a simple Contract Belt. A LOSS occasioned by a breach of trust is a simple contract equitable debt only (a), unless the settle- ment is so worded as to imply a coyenant in law on the part of the trustee to perform the trust (fi). IiiLTJST. — 1. A mere recital in a deed of the aceeptanee of the trusteeship is not sufficient to raise a covenant on the part of the trustee, and therefore will not render a loss incurred hy a subsequent breach of trust a specialty debt(c). 2. But where it is "declared and agreed," or "declared" alone, that the property shall be held upon such and such trusts, and the trustee executes the deed, and subsequently commits a breach of trust, the loss will be considered as a specialty debt due from him to the estate (cl). Art. 66. — The Liahility where joint qua Cestuis que trust may he distributable qua, Trustees. Each trustee is in general liable to the cestuis que trust for the whole loss when caused by the joint default of all ttie trustees (a). A decree against (a) Vernon v. Vaudrey, 2 Atk. [d) Westmoreland v. Tunnicliffe, 119; Mx parte JBUncowe, L. R., 1 W. N. 1869, 182; Richardson v. Ch. 393. Jenkins, 1 Dr. 477 ; and see (b) Benson v. Benson, 1 P. W. generally, Isaacson v. Sarwood, 131 ; Wood T. Sardisty, 2 Coll. mp. 542 ; Holland v. Holland, L. E., (a) Wilson v. Moore, 1 M. & K. 4 Ch. 449. 126 ; Lyse v. Kingdom, 1 Coll. Ic) Isaacsm Y. Harwood, L. E., 184 ; Ex parte Mrris, L. E., 4 3 Ch. 225. Ch. 280. 174 CONSEaUENCES OF A BREACH OP TRUST. all may lie enforced against one or more only (S). But as between tliemselves, where all are equally guilty of a breach of trust not amounting to actual fraud (c), those who have had to refund the loss to the trust will be entitled to contribution from the others {d) ; and where one is more guilty than the other or others, the whole loss may be thrown upon him (e) . The claim to contribution is a specialty debt(/). Illtjst. — 1. A loss was suffered by the creditors of a bankrupt through the joint default of the assignees in bankruptcy. A decree was made against them, and one of them had to make the loss good. Contribution was, however, enforced against his co-assignees, and the objec- tion that these ' latter acted only for conformity was dis- allowed. Sir W. Grant, M. E., said: "Where entu-e damages are recovered against several defendants guilty of a tort, a court of justice will not interfere to enforce con- tribution amongst wrongdoers ; but here there is nothing but the non-performance of a civil obligation. The ha- bhity is not ex delicto unless every refusal to comply with a legal obligation makes a party guilty of a dehctum" (g). 2. So where a large balance was found to be due jointly from a trustee and the representatives of a deceased co- trustee, but costs were given to both out of the trust estate, it being admitted that no part of the loss could be re- covered from the estate of the deceased trustee, it was held that the surviving trustee, upon paying the whole of the loss, was entitled to a lien for half of it on the costs awarded to the representatives of his deceased co-trustee (A). (5) Att.-Gen. v. Wilson, Cr. & Aft. -Gen. v. Dangars, ib. 624. Ph. 28 ; Fletcher v. Green, 33 B. (e) Featlierstone v. West, & Ir. 426. Eep. Eq. 86 ; Lew. 744. {c) Att.-Gen. v. Wilson, sup.; (/) So made by 19 & 20 Vict, see Lingard v. Bromlcij, 1 V. & B. c. 97 ; Lockhart v. Meillg, 1 D. & 114; larkton v. Hornby, 1 Y. & J. 464. C. 336. (g) Lingard v. Bromley, sup. (d) Lingard v. Bromley, sup.; (A) Fletcher y. Green, 33 B. 615. Birhs V. Mi'chlethwaite, 33 B. 409; MEAsuEE OF tritstee's eesponsibility. 175 3. H. W., as trustee of a marriage settlement, held a bond to secure 1,200^. J. "W., Ms brother, who was a specialty creditor of the obligor, obtained possession of the obligor's assets and appKed them in payment of his own debt and of simple contract debts before administration, which was afterwards granted to the obligor's widow (the sister of J. W.), who was entirely guided by his advice. Subsequently, J. W. represented to H. W. that only 6001. was forthcoming and available for the bond. H. W., acting on this statement, retired from the trust; and a memorandum was endorsed on the trust deed, signed by the administratrix and by the tenant for life of the trust fund, statLug that 600Z. only were available to pay the bond, and J. "VV. was appointed trustee of the marriage settlement in place of H. W. The assets of the obligor wovdd have been, if properly administered, sufficient to pay the bond in full. Under these circumstances it was held that J. W. and H. "W. were both liable to the full amount of the bond; but that J. "W.'s assets (he having died) were primarily answerable, as he had received the trust fund (i). Aet. 67. — The Measure of the Trustee's ResponsihilUij. The general measure of a trustee's responsibility for a breach of trust is the amount by vrhich the trust property has been depreciated withont interest {a) : Provided that — a. Where he has actually received interest, or ought to have received interest, he will be liable to account for what he has received in the one case (h), and for what he ought to have received in the (i) Featherstone v. West, 6 Ir. L. E., 8 Ch. SSSxSx parte Ogle, Bep. Eq. 86. ii. 716; BurdicJc\v. Qarrard, (a) See Att.-Gen. v. Alford, i L. R., 5 Oh. 233.y D. M. & G. 851 ; Staffm-d v. Fid- [b) lb., and see Jones v. Foseall, don, 23 B. 386 ; Vyse v. Foster, 15 B. 392. ' 176 CONSEQUENCES OF A BEEACH OP TRUST. other, wliich is, in tlie absence of express direction, 4 per cent, (c) ; /3. "Wtere it is so fairly to be presumed that he did receive interest, that he ought to be estopped from denying that he did actually receive it, he will be liable to pay simple interest at 4 or 5 per cent, according to the circumstances. But where he has employed the trust property' in trade or speculation, he will be liable to pay iaterest at 5 per cent, with yearly, or even half-yearly, rests, if he may reasonably be presumed to have made that amount, or (where he has actively employed it in trade or speculation), at the option of the cestuis que trust, to account for all the profits made by him (d). The circumstances which will raise such a presumption admit of no rule, but, in general, misconduct, which has had his own benefit as the end in view, wiU raise it (e) . Illust. — 1. A trustee -wlio is guilty of unreasonable delay in investing trust funds will be answerable to the cestuis que trust for simple interest at 4 per cent, during the continuance of such delay (/). 2. A trustee who without proper authority calls in trust property invested on mortgage at 5 per cent., would be liable for that rate of interest, for although he may not actually have received that rate, he ought to have done so (5-). 3. A trustee retained trust funds uninvested for several years, and mi^^ed them with his own private monies. The Vice-Chancellor held that 5 per cent, compound interest was chargeable ; but on appeal this decision was reversed, Lord (c) Att.-Gen. v. Alford, sup.; nick v. Mtirray, 7 D. M. & Gr. Stafford Y. jFiddonj sup. 519 ; Townend \. Townend^ 1 Gif. (d) See Jones v. Foxall, sup.; 212; Burdick v. Garrard, sup,; Vyse T. Foster, sup. ; JBurdlck v. Vyse v. Foster, stip. Garrard, sup. (/) Stafford v. Fiddon, sup. (e) See and consider judgments, (17) See judgment in Jones v. Att.-Gen. v. Alford, sup.; Ex Foxall, sup. parte Ogle, sup.; Mayor of Her- MEAStTKB OF TRUSTEES' EESPOKSIBIIITY. 177 Cranworth saying : " Generally speaking, eveiy executor and trustee who holds money in his hands is hound to have that money forthcoming ; he is, therefore, chargeable with interest, and is almost always to be charged with interest at 4 per cent. It is presumed that he must have made interest, and 4 per cent, is that rate of interest which this court has usually treated it as right to charge In the present instance, I observe that one of the grounds of misconduct relied upon by the Vice- Chancellor is, that the defendant did not conimunicate the matter to the rector and churchwardens (the cestuis que trust). This was ex- tremely improper conduct, no doubt, but not in itself such conduct as enables me to make any alteration in the mode in which he is to be dealt with in point of interest. It is not misconduct that has henefited him,, unless indeed it can be taken as evidence that he kept the money fraudulently m his hands, meaning to appropriate it. In such a ease, I think the court would be justified in dealing, in point of interest, very hardly with an executor, because it might fairly infer that he used the m,oney in speculation, hy which he either did m.ahe b per cent., or ought to lie estopped from saying that he did not. The court would not inquire what had been the actual proceeds, but in appHeation of the principle, in odium spoliatoris omnia preesumuntur, would assume that he did make the higher rate, that is, if that were a reasonable presumption'''' (Ji). 4. In Burdick v. Garrard (i), a solicitor, as the agent of the plaintiff, held a power of attorney from him, under the authority of which he received divers sums of money, and paid them into the bank to the credit of his (the solicitor's) firm. On a bill being filed by the client for an account, the Viee-Chancellor made a decree for payment of the principal with compound interest ; but the Court of Appeal reversed this decision. Lord Hatherley saying : " The Vice- Chancellor has directed interest to be charged at the rate (A) Att.-Gen. v. Alford, sup. ii) L. R., 5 Ch. 233. r.T. N 178 coif SEQUENCES OF A BEEA.CH OF TRUST. of 5 per cent., which, appears to me to be perfectly right, and for this reason, that the money was retained in the de- fendants' own hands, and was made use of by them. That being so, the court presumes the rate of interest made upon money to be the ordinary rate of interest, viz. 5 per cent. I cannot, however, think the decree correct in directing half-yearly rests, because the principle laid down in the case of The Attorney-General v. Alford appears to be the sound principle, namely, that the court does not proceed against an accounting party by way of punishing him for making use of the plaintiff's money, by directing rests, or payment of compound interest, but proceeds upon this principle, that either he has made, or has put himself into such a position that he is to be presumed to have made, 5 per cent., or compound interest, as the case may be. If the court finds it is stated in the bUl, and proved, or pos- sibly (and I guard myself on this point of the case) if it is not stated, but is admitted on the face of the answer without any statement in the biU, that the money received has been invested in an ordinary trade, the whole course of decision has tended to this, that the court presumes that the party against whom relief is sought has made that amount of profit which persons ordinarily do make in trade ; and in those cases the court directs rests to be made. But how does the case stand here ? .... It must not be forgotten that a solicitor's business is not such a business as I have described ; it is not one in which half- yearly or yearly rests, as the case may be, would be made in making up the account. There is nothing like com- pound interest obtained upon the money employed by a solicitor. On the contrary, he is ovA of pocket for a con- siderable period by those moneys which he expends, and upon which he receives no interest for possibly three or four yeai's. It appears to me, therefore, that no case arises here in which you could say that such a profit has been made, or necessarily is to be inferred." MEASURE OF TETJSTEES' EESPOKSIBILITT. 179 5. In order to charge a trustee witli compound interest, or with actual profits for employing the trust funds in trade, there must be an active calling in of the trust moneys for the purpose of embarking them in the trade or speculation. In Vyse v. Foster (Jc) the facts were as fol- lows : — ^A testator was partner in a well-established and prosperous business, under articles, by which, on the death of any partner, his share was to be taken by the surviving partners, at a price to be ascertained from the last stock- taking, and to be paid by instalments extending over two years, with interest at 51. per cent, per annum from his death. He appointed three executors, one of ivhom was one of the partners in his-business, and another some years after his death became a partner ; the third never was concerned in the business. The value of the testator's share was ascertained but not paid, the amount being allowed for some years to remain in the hands of the firm, who treated it in their books as a debt, and allowed interest on it at bl. per cent, per annum, with yearly rests. One of the testator's residuary legatees, upon becoming entitled to payment of her share, refused to accept payment on the above footing, and filed her bill against the executors, claiming to be entitled to a share in the profits of the business arising from the use of the testator's capital. Upon these facts, it was held that the plaintifi: was not entitled to any account of profits, the mere delay by exe- cutors in calling in a debt due to the testator from a firm of which some of the executors were members, not giving his estate any right to share in the profits. Lord Justice James said: "If an executor or trustee makes a profit by an improper dealing with the assets or the trust fund, that profit he must give up to the trust. If that improper deahng consists in embarking or investing the trust monej^ in business, he must account for the profits made by him by such employment in such business, or at the option of {k) L. R., 8 Ch. 309. ' N 2 180 CONSEQUENCES OF A BKEACH OE TEUST. the cestuis que trust, or if it does not appear, or cannot be made to appear, what profits are attributable to such em- ployment he must account for trade interest — that is to say, interest at 5 per cent. In this case the successive partner- ships have charged themselves in their own accounts with interest at 5 per cent, and with annual rests, and the sum due on that footing has been paid. And the questions, therefore, are, whether the plaintiff is entitled to anything; and if any- thing, to what and from whom in respect of the surplus profits due to capital, and how are such surplus profits to be ascertained. In the first place, there is a clear breach of trust in not calling in the money. . . . But it is neces- sary to consider another asjjeet of the matter. . . . This court is not a court of penal jimsdiotion. It compels restitution of property unconscientiously withheld; it gives full compensation for any loss or damage through failure of some equitable duty ; but it has no power of punishing anyone. In fact, it is not by way of punishment that the court ever charges a trustee with more than he actually received or ought to have received and the appropriate in- terest thereon. It is simply on the ground that the court finds that he actually made more, constituting monies in his hands had and received to the use of the cestuis que trust (^). A trustee, for instance, lending money to his firm, is answerable for such money, with full interest, to the uttermost farthing ; but to make him answerable for aU the profits made of such money hy all the firm would be simply a punishment. ... Is the mere fact of the union of the three characters — debtor, executor, and trader — in the same person, sufficient to entitle the estate to an investigation into the trader's own business, because there has been some delay, or great delay, in paying ofic the debt? We have found no case in which this has been laid down, oven in the case of a sole executor, sole debtor, sole trader. {V) But see per the same learned judge in Ex parte Oak, L. E., S Ch. 717. TRUSTEE MIXING TEUST PUNDS. 181 There have been hundreds, probably thousands, of oases in TFhich traders have been executors, and in which, on taking their accounts, balances, and large balances, have been found due from them ; but in no case, so far as •we are aware, has it ever been held, that (where there has been no active breach of trust in the getting in or selling out trust assets, but where there has been a mere balance on the account of receipts — legitimate receipts — and payments) the omission to invest the balance has made the executor liable to account for the profits of his own trade. But this case is far stronger than the case we have suggested ; and if the rule as to profits were to apply to it, it would be difficult, if not impossible, to exclude from its application, cases where it would shock the common feelings of mankind." Art. 68. — Charge upon Property of the Trustee with which he has mixed the Trust Property. Where a trustee mixes the trust property with his own, so that the two cannot be separated witli per- fect accuracy, the equity of the cestuis que trust will attach on the entire fund for the whole of what is due to them («). Illust. — In Coolc v. Addison (J), A. was one of the trustees under a settlement, and he was also, in his own right, the lessee of a house. This house he sublet to 8., who covenanted to repair it. 8. afterwards borrowed (legitimately) a sum of money from the trustees, and therewith purchased from A. the furniture in the house, and executed a mortgage of his underlease, and a bill of sale of the furniture to the trustees. 8. getting into diffi- culties, A. put an end to the underlease and re-entered and took possession. He subsequently assigned the premises to P. at a rent of 310^., and a premium of 100/. The [a) Liipton V.White, lb \.iZ2\ 372. FMiiell V. Deffell, i D., M. & G. (4) L. E., 7 Ec[. 471. 182 CONSEQUENCES OF A BEEACH OE TEUST. furniture was purchased by F. for 5501., and lie also paid 2501. towards repairs. A. invested a sum to make good the principal trust fund, but refused to pay the interest which had accrued due from S. It was held, however, that he had, by his conduct, mixed the trust funds with his own, and that the interest must be paid out of the sum received by him from P. for repairs; the Vice-Chancollor Stuart saying, "It is a well-established doctrine in this court, that if a trustee or agent mixes and confuses the property which he holds in a fiduciary character with his own propert}', so as that they cannot be separated with perfect accuracy, he is liable for the whole. In this case, it is impossible to say how much of the 2501. received by the defendant Addison from Fowler for repairs consisted of what was due under the covenant to repair in the under- lease. The consequence is, that the whole 250/. is liable to the demands of the cestuis que trust, so far as necessary to make up, with the other sums admitted to be part of the trust property, the full amount of the trust fund of 520/., with interest at five per cent, per annum." Akt. 69. — Property acquired ly a Trustee out of Trust Funds becomes Trust Pro2)erti/. . If a trustee has disposed of the trust property, and the money or other property which he has received, or acquired out of the proceeds can be traced in his hands, or in those of his representatives, such pro- perty will be liable to the cestuis que trust, and will be burdened with the same trusts as the origi- nal trust property (a). Illtjst. — 1. Thus where money is handed to a broker (a) Taylor v. Flumcr, 3 M. & Sim. Ill; lane v. Dighton, Arab. S. 562 ; Clicdworth v. Edtcanls, 409 ; Scales v. Baker, 28 B. 91 ; 8 v. 46; Frith v. Gartland, 2 H. Cook v. Addison, L. E,., 7 Eq. & M. 417; Lench v. Lencli, 10 V. 466; Fmcst v. Croysdill, 2 D., F. 617; Hopper v. Conyers, L. E., 2 & J. 175. Eq. 549 ; Trench t. Harrison, 17 PEOPEETY PTJEOHASED 'WITH TEUST MONEYS. 183 for tlie purpose of pureliasing stoct, and he invests it in unauthorized stock, and absconds, the stock which he has purchased mil belong to the principal, and not to the broker's assignee in bankruptcy. Por a broker is a con- structive trustee for his principal, and, as was said by Lord EUenborough, "the property of a principal entrusted by him. to his factor for any special purpose, belongs to the principal notwithstanding any change which that property may have undergone in form, so long as such property is capable of being identified and distinguished from aU. other property" (b). 2. Trustees had power, with the consent of the tenant for life, to sell the trust property, and they were directed to invest the purchase-money in the purchase of other real estate, to be settled on the like trusts. The trust property was sold under this power for 8,440^., and the tenant for life was allowed (wrongly) to keep the purchase-money. About the same time he purchased another estate for 17,400Z, of which sum 8,1241. was part of the above-men- tioned trust money. This estate was conveyed to him in fee simple. The tenant for life eventually became bank- rupt, and it was held, that as against his assignees in bankruptcy, the original trustees of the settlement had a lien on the estate which he had purchased, to the extent of the moneys invested in its purchase (c). 3. So, in Hopper v. Conyers {d), a solicitor having in his possession the title deeds of an estate mortgaged to his client, deposited them with his own banker to secure an advance, which he appKed in the purchase of an estate on his own behalf. When the mortgage to his client was paid off, he applied the money in repaying the loan from Ms banker, and informed his client that he had re-invested the mortgage money upon other good security, and his (I) Taylor v. Plumer, sup.; and (c) Price v. Blal-emore, 6 B. 507. see also Ex parte Cooke, L. K., 4 \d) L. K., 2 Eq. 549. Ch. Div. 123. '-r; ,_ - ..^ -^,, , 184 CONSEQUENCES OF A BREACH OF TaTJST. client thereupoii executed a re-assignment of the mortgaged property. In fact the solicitor never re-invested the money upon other good security, although he continued to pay interest upon it until his death. Upon the true state of the transaction being discovered, the court held, that the client -was entitled to a lien upon the estate purchased by the solicitor. 4. W. having entrusted P., his solicitor, with a sum of 7,700/. for investment on mortgage on his behalf, was in- formed by P.'s clerk, in conversation, that P. proposed to invest the money on mortgage of leasehold property at Camden Town at 5 per cent.; and subsec[uently received a letter from P., stating that "the money was put on 5 per cent, mortgage, as arranged by my clerk with you." On P.'s death, it was found that no mortgage existed in favour of W., but that P. had advanced 100,000Z. to a firm of builders, on a mortgage of their leasehold property at Camden Town. It was held that P., and those claiming under him, were bound by the representation made by him, and were estopped from denjdng that the 7,700?. formed part of the 100,000?. so invested (s). Akt. 70. — No Set-off alloiced to the Trmtee lohere Breaches are distinct. A trustee is only liable for the actual loss in each distinct and complete transaction which amounts to a breach of trust, and not for the loss in each particular item of it (a) ; but a loss in one trans- action or fund is not compensated by a gain in another and distinct one (b). IiiLUST. — 1 . In Vyse v. Foster (c) a testator devised his real and personal estates upon cpmmon trusts for sale, making («) Middleton v. FoUoch; L. R., (b) Wiles v. Gresham, 2 Drew. 4 Ch. Div. 49. '■^-T'. -■ '-■ '. 258; Dines v. Scott, i Euss. 195. (a) Tijse V. Foster, L. E., 8 Gh. [c) Supra. 336. / / r , ;•' J NO SET-OFF GElfEBALLT ALLOWED. 185 them a mixed fund. His trustees were advised, tliat a few acres of freehold land which belonged to him might be advantageously sold in lots for building pui-poses, and that to develop their value, it was desirable to build a villa upon part of them. They accordingly built one at a cost of 1,600/. out of the testator's personal estate. The evidence showed that the outlay had benefited the estate, but Vice- OhanceUor Bacon disallowed the 1,600/. to the trustees in passing their accounts. The court of appeal, however, reversed the Vice-Chancellor's decision, the Lord Justice James saying, "As the real and personal estate constituted one fund, we think it neither reasonable nor just to fix the trustees with a sum, part of the estate, bona fide laid out on other part of the estate, in the exercise of their judg- ment as the best means of increasing the value of the whole. If they were mistaken in this, which does by no means appear, the utmost they could be fairly chargeable with would be the loss (if any) occasioned by the mistake in judgment." 2. In Wiles v. Gresham {d), on the other hand, by the negligence of the trustees of a marriage settlement a bond debt for 2,000Z. due from the husband was not got in, and was totally lost. Certain other of the trust funds were without proper authority invested in the purchase of land upon the trusts of the settlement. The husband, out of his own money, greatly added to the value of this land ; and upon a claim being made against the trustee for the 2,000Z., they endeavoured to set off against that loss the gain which had accrued to the trust by the increased value of the land, but their contention was disallowed, the two transactions being separate and distinct. 3. Again: Trustees had kept invested on unauthorized security a sum of money which they ought to have invested in consols, and which was in conseq[uence depreciated. [d) Supra. 186 CONSEQUENCES OF A BREACH OF TRUST. Eventually part of tlie money was invested in consols, at a far lower rate than it would have been if invested according to the directions in the will. The trustees claimed to set- off the gain against the loss, but were not allowed to do so; because "at whatever period the unauthorized security was realized, the estate was entitled to the whole of the consols that were then bought, and if it was sold at a later period than it ought to have been, the executor was not en- titled to any accidental advantage thence accruing (e). This case is at first sight difficult to be distinguished from Vyse v. Foster, but it wiU be perceived that the loss and gain resulted from two distinct transactions. The loss resulted from a breach of trust in not realizing the securities ; the gain arose from a particular kind of stock being at a lower market value than usual at the date at which the trustees bought it. 4. "Where, however, trustees committed a breach of trust in lending trust moneys on mortgage, and upon a suit by them the mortgaged property was sold and the money paid into court and invested in consols pending the suit, and the consols rose in value, the trustees were allowed to set-off the gain in the value of the consols against the loss under the mortgage, for the gain and loss arose out of one trans- action (/). It is, however, very difficult to reconcile this case with the last one, but it seems to be reasonable and in accordance with common sense. Art. 71. — Cestuis que trust may compel Performance of Duty or prevent Commission of Breach of Trust. Where the court is satisfied that trust property is in danger, either through the supineness (a) of, or a contemplated or probable active breach of duty [b) (e) Limes v. Scott, i Russ. 195. (i) Taliot v. Scolt, 4 K. & J. {/) Fletcher v. Green, 33 B. 139; Middleton v. Dodsicell, 13 Y. 426. 266; Dance y. Goldingham,'L.'B,., {a) Foley-v. Burnell, 1 B. C. C. 8 Ch. 902. " '^../^ /< i^^/. 277; Fletchw v. Fletcher, 4 Ha. 78. ' INJUfrCTIOX AND EECEIVEE. 187 hy, the trustees, or where the latter are residing out of the jurisdiction of the court (c), an injunction will be granted at the instance of any person with an existing, vested or contingent interest (rf), either compelling the trustees to do their duty (e), or re- straining them from interfering with the trust pro- perty (/), as the case may require; and if expedient a receiver will he appointed (g). Illust. — 1. Thus, if one commits some trespass upon lands in the possession of the trustee, and the latter refuses to sue him, the court wiU oblige him to lend his name for that purpose, on receiving a proper indemnity from the cestuis que trust {h). 2. And so if a tenant for life refuses to renew lease- holds, the court will compel him to do so, and a receiver of the income of the trust property will be appointed to collect sufficient to pay the renewal fine (e). 3. In JUarl Talbot v. Scott (k), lands were vested in triistees by act of parliament, upon trust for sale, and subject thereto, upon trusts inalienably annexing the rents to the Earldom of Shrewsbury. The Earl of Shrewsbury attempted to disentail (which of course he could not do effectually), and devised the lands to the same trustees, upon trust for a particidar claimant of the title. The trustees accepted this trust, and claimed to receive the rents in that character, pending proceedings by the plaintiff to estabhsh his claim to the earldom. A receiver of the rents was however appointed on his application', upon the ground that the trusts of the will were in conflict with the prior trusts tipon which they held the estate. (c) Noadr.Baclclwuse,'iY.C.G. (/) See cases in note (i). 529. (g) See cases in note (4) ; and {d) Lew. 697; Scott v. Becker, Bennett v. Collcy, 5 Sim. 192. 4 Pr. 346; and compare Davis v. (h) Foley v. Burncll, sup. Angel, 10 W. R. 723, -with lie (s) See Bennett v. Colley, sup.; Shepherd, 4 D., F. & J. 423. and Lew. 696. {e) See cases in note {a). {h) Supra. 183 COIfSEQITEIsrCES OF A EEEACH OF TRUST. 4. So In Evans v. Coventry {!), a bill was filed by a plaintifE insured in a society whose funds were liable to pay the insurance money, on behalf of himself and other persons so insured, charging a loss of the funds through the negligence of the directors. The answers and affi- davits showed that the secretary had absconded with part of the funds, and that some of the directors were in needy circumstances, and the court granted an injunction re- straining the directors from touching the funds, and ap- pointed a receiver of them. Lord Justice Knight Bruce saying, "The application before the court is founded on the common right of persons who are interested in property which is in danger to apply for its protection In my judgment the objections which have been urged against this application might be urged with as much reason, as much force, and as much effect, if this were an appli- cation to restrain the felling of timber in a case of waste, partly perpetrated and partly imminent." 5. On similar grounds the court will appoint a receiver and grant an injunction where from the character or con- dition of the trustee he is not a fit person to have the control of the trust property; as, for instance, where he is insolvent (to), or about to become a bankrupt (n), or is a person of dissolute habits, or dishonest (o). 6. Again, the court wiU grant an injunction to restrain a sale by trustees at an under value {p), although this was at one time doubted (§■). (I) 5 D., M. & G. 911. [p) Anon., 6 Mad. 10; and see (»i) Mansfield t. Shaiv, 3 Mad. TFelili v. JSarl of Shaftesbury, 7 100; GladdonY. Stoneman,'\.'iil&i. V. 488; IllUigan v. Mitchell, 1 143, n. M. & K. 446 ; Dance y. GoUing- (n) Jte S.'s Estate, Jj.'R.,lCh. /mot, L. E., 8 Ch. 902. 7 1^1,^;'^ Div. 276. {q) rochel v. Fowler,' 2 Anst. (0) See Everett v. Prythergch, 549. 12 Sim. 365. CEIMIXAL PIlOCEEDI^'^GS. 189 Art. 72. — Fraudulent Breach of Tntst a Crime. A trustee wlio fraudulently appropriates or disposes of the trust property, in any manner iaconsistent with the trust, is guilty of a misdemeanor, and is liable to be kept in penal servitude for not more than seven and not less than five years, or to be imprisoned, with or without hard labour, for not more than two years : Provided, that no criminal proceedings can be instituted without the sanction of the Attomey-Greneral, or of the Solicitor-Greneral, or (if civil proceedings have been commenced) of the judge of the court wherein they have been commenced («). The fact, that a breach of trust is a crime, does not afEect the validity of any civil proceeding, nor any agreement for restoration of the trust property {b). [a] 24 & 25 Vict. u. 96, s. 80. (5) Md., s. 86. 190 CONSEaUENCES OE A BEEACH OE TRUST. SUB-DIVISION n. Liability of Parties other than the Trustees. Art. 73. — Liability of Cestui que trust who is Party to a Breach of Trust. Where one of several oestuis que trust has joined in a breach of trust, his whole equitable interest under the settlement (a) (except where he also has the legal estate (b) ) may be stopped by his eo- cestuis que trust as against him and all persons claiming under him, except purchasers for value ■without notice (c), until the whole loss has been so compensated : IProvided that this article does not apply where the guilty cestui que trust is a feme covert loithoitt poicer of anticipation [d). Illust. — 1. A trustee in breach of trust lent the trust fund to A. B., the tenant for life. The trustee afterwards concurred in a creditors' deed, by which A. B.'s life inte- rest was to be applied in payment of his debts, and the trustee received thereunder a debt due to him from A. B. Before the other creditors had been paid, the trustee re- tained the life income to make good the breach of trust. It was held, upon a bill filed by those claiming under the creditors' deed, that the court would not restrain the trustee from making good the breach of trust out of the («) Woochjatt V. Greslcy, 8 Sim. (c) TVilUams v. Allen JVo. 2, 32 180; Fuller t. Kniglit, 6B. 205; B. 650; Kibvorth y. MounteasM, W-GaoUn v. Dew, 15 B. 84 ; 15 Ir. Ch. E,. 565 ; Jaaibs v. Vaughton v. Noble, 30 B. 34 ; Rylance, sup.; Ex parte Ttirpin, Jacuis T. Sijlance, L. R., 17 Eq. 1 D. & 0. 120; TVoodtjatt v. Gres- 341. ley, sup.; Cole v. MtiMle, 10 Ha. (*) Hgiert v. Butter, 21 B. 560; 186. Fox V. Suckley, L. E,., 3 Ch. Div. (d) Liew. 744 ; and see Stanley 508; but see Woodyatt t. Greslcy, v. Stanley, L. R., 7 Cli. Div. SUpl\ _ ' 7 - OESXtri QUE TEtrST PRIVY TO BREACH. 191 life income, for althougli the trustee, being a creditor and party to the deed, had, qufi, himself, no right to retain the life interest, yet, as representing the cestuis que trust, he was justified in doing so. And the Master of the EoUs said: "This bill, proposing to leave nothing but the per- sonal liability of Knight (the trustee) for the reparation of the breach of trust, seeks to mthdraw the liability of the life estate, and thus materially diminish the security of the cestuis que trust. ... I cannot reconcile myself to the notion, that this is a course ivhich this court could pursue" (e). 2. In Woodyatt v. Gresley {/), the facts were as follows. On the marriage of Sir N. and Lady Gresley two settle- ments were executed : by one, a sum of stock and estates in "W. (the lady's property) were conveyed to trustees in trust for her for life, with remainder in trust for the chil- dren of the marriage; and by the other. Sir N. granted out of his estates a rent-charge to Lady G. for life. She, after her husband's death, fraudulently obtained a transfer of the stock, and sold it out ; and afterwards she assigned her Ufe interest in the estates in W. and the rent-charge to A. for valuable consideration, but ivith notice of the fraud. It was held, that the rents of the estates in W. and the rent- charge were liable to be applied to replace the stock, and a receiver of them was appointed for that purpose. 3. But where a testator devised certain real estate for life to one of his executors and trustees, and the devisee afterwards committed a breach of trust and filed his peti- tion for liquidation, it was held, that as against the trustee in liquidation the other cestuis que trust had no lien on the interest of the trustee, the Lord Justice James saying, "The estate of a leyal devisee is, under no circumstances, under the control of the court" (jr). (e) Fuller v. Knight, sup. (ff) Fox r. Buckley, L. E., 3 (/) 8 Sim. 180. Ch. Div. 511. 192 coirsEauBjrcEs op a breach of teust. Aet. 74. — Liability of Third Parties privy to a fraudulent Breach of Trust. All persons who are parties to a fraudulent breach of trust render themselves equally liable with the trustees, and the Statute of Limitations will not run in their farour until the fraud is known to the persons afEected by it (a) . Illust. — 1. A testator bequeathed a sum of 600^., wMch he described as being in the hands of one Gregory (to whom he had lent the same on the security of his note of hand), to his son-in-law EoLfe, upon trust to invest the same and pay the dividends and interest to his daughter, the wife of EoLf e, for life, for her separate use ; and after her death, upon trust for Rolf e for life, with remainder to their children. On the death of the testator, Eolfe the trustee became indebted to Gregory, and in order to dis- charge part of that debt he delivered to Gregory the note of hand for 6001. It was held that as Gregory had infor- mation of the manner of the bequest he was a party to the fraudulent abstraction of the trust property, and Uable to refund the amount, and that being founded on fraud the Statute of Limitations did not apply (5). 2. So where a fund was standing to the account of two trustees in the books of some bankers, who had notice that it was a trust fund, and by the' direction of the tenant for life only they transferred it to his account, and thereby obtained payment of a debt due from him to them. It was held that the trustees might sue the bankers to have the trust fund replaced, and that the Statute of Limitations was not applicable (c). 3. In Eaves v. Hickson {d), trustees had paid over trust [a) Eolfe V. Gregory, 11 Jur., Div. 352. N. S. 98 ; Bridgeman v. Gill, 2i (5) Rolfe v. Gregory, sup. B. 302; Eaves r. Mekson, 30 B. le) Sridgeman y. Gill, 2iB. 302. 136 ; and see per Malias, V.-C, [d) 30 B. 136. Morgan v. Mford, L. B., 4 Cli. FOLLOWINa TllUST PEOPEKTT. 193 funds bequeathed to the children of one William Knibb, upon the faith of a forged marriage certificate, which William Knibb produced to them, from which it appeared that certain illegitimate children of his were legitimate. It was held that William Knibb, who had produced the certificate, must be made responsible for the money as well as the trustees. Art. 75. — Following Trust Properly into the Hands of Third Parties. If trust property comes into the hands of any person inconsistently with the trust, then — a. If such person has got the legal estate, he will be a mere trustee for the persons entitled under the trust ; unless he, or some person through whom he claims («), has bona fide purchased the property for valuable consideration, and without receiving notice of the existence of the trust before completion of the purchase, and before payment of the purchase- money ih) ; /3. If he has not got the legal estate (c), or if the property is a mere chose in action [d), he will be a mere trustee, notwithstanding that he purchased it bon^ fide for value and without notice; unless (being a chose in action) the property consists of a negotiable instrument (c) , or an instrument which was intended by the parties to it to be transferable free from all equities attaching to it (/). Illtjst. — 1. Thus in Boursot v. Savage {g), A., one of («) Sarrison t. Forth, Pr. Ch. More v. Mahow, 1 Ch. Ca. 34. 51; Martins T. Joliffe, Amt. 313; {e) SeeperLordWestbury-jPAi/- M'Queen v. Farquhar, 11 V. 478. lips v. Phillips, 4 D., P. & J. 208. (b) SasseitY.Nbsu'ortht/,2Jj.G. (d) Turto?i v. Benson, 1 P. W. 1; Boursot y. Savage, 'L.U.,1'E,<1. 496; Ord t. White, 3 B. 357; 134; Mackreth\.Symmons, 15 V. Mangles \.I)ixon,Z'3..'L.Ga,&.102. 349; FilcherY. EawUns, L. E., 7 («) Anon., Com. Kep. 43. Ch. 259; and as to the time at [f) Be Blakeley Co., L. E., 3 which /the notice is efBectual, Ch. 154; Be General Estates Co., Lady Bodmin v. Vanderbendz, 1 ibid. 758 ; Crouch v. Credit Fonder, Ver. 179\; Jones v. Thomas, 3 L. R., 8 Q. B. 374^ and see P. W. 243; Attorney-General v. Judicature Act, 1873; s; 25. Gower, 2 Bfl. Ca. Ab. 685, pi. 11; {g) L. R., 2 Eq. 134. U.T. ' 194 CONSEQUENCES OE. A BREACH OE TKITST. three trustees, executed an assignment of leasehold pro- perty, held by them jointly, to a purchaser, and forged the signatures of his two co-trustees, and also the requisite assent of his cestui que trust to the sale. A. was a solicitor, and acted as such for the purchaser. It was held, that in accordance with the maxim Qui facit per alium, facit per se, the purchaser had constructive notice by his solicitor of the existence of the trust, and that although the execution by one of three joint tenants was a valid assignment of the legal interest in one-third of the property tff the purchaser, yet the constructive notice of the trust disentitled him from taking any beneficial interest. 2. So where there is a lien for unpaid purchase-money (which, as we have seen, burdens the estate with a trust pro tanto), a subsequent purchaser, with notice of the lien (such, for instance, as that which is constructively afforded by the absence of an indorsed receipt on the convey- ance (h) ), will take the estate subject to it («'). 3. If an alienee is a volunteer, then the estate will re- main burdened with the trust, whether he had notice of the trust (^) or not (Z); for a volunteer has no equity as against a true owner. 4. But where one purchased lands from a devisee of them bona fide, and without notice of any defect in the will, and afterwards the heir of the testator filed a bni, alleging that the testator had revoked his will, it was held that the purchaser was entitled, whether the will was re- voked or not (ot). 5. In Thorndike v. Hunt («), a trustee of two different settlements having applied to his own use funds subject to one of the settlements, replaced them by funds which, (/j) 2 Prest. Conv. 429. Ed. 55. (i) Mackreth v. Symmons, 15 V. (m) Bassett v. Nbsworthy, 2 L. 349. C. 1. {k) Mansell v. Mansell, 2 P. W. («) 3 D. & J. 56; and see Case 678. T. James, 3 D., F. & J. 266; and {I) Hid.; Spurgcon v. Collier, 1 Dawscm v. Frince, 2 D. & J. 41. FOLLOTVllTG TRUST PEOPEETY. 195 under a power of attorney from Ms co-trustee under the other, he transferred into the names of himself and his co- trustee in the former. In a suit in respect of breaches of trust of the former settlement, the trustees of it transferred the fund thus replaced into coiirt, and it was held by the Court of Appeal, that the transfer into court was equiva- lent to an alienation for value without notice, and that the cestuis que trust under the other settlement could not follow the trust fund. 6. The trustees of a settlement advanced the trust money on the security of real property which was conveyed to them by the mortgagor, the mortgage deed noticing the ■trust. The surviving trustee of the settlement afterwards reconveyed part of the property to the mortgagor on pay- ment of part of the mortgage money, which he forthwith appropriated. The mortgagor then conveyed that part of the property to new mortgagees, concealing, with the con- nivance of the trustee, both the prior mortgage and the reconveyance. When the fraud was discovered the cestui que trust under the settlement filed a bill against the new .mortgagees, claiming priority; but the court refused to interfere. Lord Justice James saying, "I propose to apply myself to the case of a purchaser for valuable consideration without notice, obtaining on the occasion of his purchase, and by means of his purchase deed, some legal estate, some legal right, some legal advantage ; and according to my view of the established law of this court, such a pur- chaser's plea of a purchase for valuable consideration with- .out notice, is an absolute, unqualified, unanswerable plea to the jurisdiction of this court. ... In such a case a purchaser is entitled to hold that which, without breach of duty, he has had conveyed to him"(o). 7. It would seem that a bona fide purchaser for value would not be bound by notice of a very doubtful equity; (o) Fikher v. Mawlins, L. E., 7 Cli. 259. • - - > , ■ 2 196 CONSEQUENCES OF A EEEACH OF TRUST. for instance, wliere the construction of a trust is ambiguous or equivocal (jo) ; but where he is ignorant of any well- understood doctrine of equity, such, for instance, as that relating to the separate estate of married women (§■), he will not be excused. 8. A purchaser with notice from a purchaser without notice is safe ; for if not, an innocent purchaser for value would be incapable of ever alienating the property which he had acquired without breach of duty, and such a restraint on alienation would necessarily create that stag- nation against which the law has always set its face (r). 9. Where a trustee, holding a mortgage, deposits the deeds with another to secure an advance to himself, the lender will have no equity against the cestuis que trust, however bona fide he may have acted, and however free he may have been of notice of the trustee's fraud, for he has not got the legal estate, and therefore his equity, being no stronger than that of the cestuis que trust, the maxim Qui prior in tempore, potior injure est applies (s). 10. It is upon this principle that choses in action are generally taken, subject to all equities affecting them. Thus in Turton v. Benson {t), a son on his marriage was to have from his mother, as a portion, a sum equal to that with which his intended father-in-law should endow the intended wife. The son, in order to induce the mother to give him a larger portion, entered into a collusive arrange- ment with the father-in-law, whereby, in consideration of the latter nominally endowing his daughter with 3,000/., the son gave him a bond to repay him 1,000/., part of it. This bond, being made upon a fraudulent consideration, was void in the hands of the father-in-law, and it was held, (p) Hardy v. Ueeves, 5 V. 426; in) Parker v. Brooke, 9 V. 583. Cordwell v. Mackrill, Arab. 516; (;■) See cases cited note (a), aiip. Warwiek v. Warwick, 3 At. 291 ; (s) Newton \. Newton, L. R., i but see and consider per Lord St. Ch. 143 ; and Joyee v. Se Moleyns, Leonards, Thompson t. Simpson, 2 J. & L. 374. 1 Dr. & "War. 491. {t) 1 P. "W. 496. SEEING TO APPLICATION OF PtTECHASE-irONET. 197 that being a chose in action, he could not confer a better title upon his assignee. 11. The bona fide purchaser of an equitable interest without notice of an express trust, cannot defend his position by subsequently, and after notice, getting in an outstanding legal estate /roTO the trustee; for by so doing he -would be guilty of taking part in a new breach of trust (ti). But it would seem that if he can perfect his legal title without being a party to a new breach of trust (as, for instance, by registering a transfer of shares which have been actually transferred before notice), he may legitimately do so («). Art. 76. — Liability of Persons paying Money burdened with a Trust to see to its ApjiUcation. "WTiere a person purchases trust property under a trust for sale with notice of the trust, or pays money owing to the trust estate with like notice, he is bound to see to the application of money paid by him (a), except in the following cases, namely : — a. Where the settlement expressly exempts him from doing so ; /3. Where the settlement is dated subsequently to the 28th August, 1860, and the duty is not expressly cast upon him by the settlement {b) ; 7. Where the trusts of the money are not simple {a) Saunders v. Behcw, 1 Ver. have begged the question, inas- 271; CoKiej-v. JIfc-B««n, 34:B. 42G; much, as it states that the pur- Sharples v. Adams, 32 B. 213; chaser shall be discharged by Carter V. Carter, 3 K. & J. 617. "the receipt of any person to {v) Dodds T. lI'Ms, 2 H. & M. -whom any purchase or mortgage 424. money shall he payable upon any (a) Dart, 596, 5th ed. ; Elliott express or implied tnist," whereas V. Merry man, 1 L. C. 64. the whole question is, whether the (4) 23 & 24 Vict. 0. 145, ». 12. purchase-money is payable to the This statute is the only one trustee or to the eestuis que trust, which can be relied on. Lord In addition to which it only ap- St. Leonards' Act, 22 & 23 Vict. plies to purchasers and mortga- c. 35, s. 23, which was intended gees, to have the same efEect, seems to 198 CONSEQUENCES OE A BEEACH OF TRUST. trusts (c), or being simple trusts it is gatliered from the settlement that the settlor contemplated the pos- sibility of any of the oestuis que trust being under disability at the date of the sale or payment (li), or in any other case where an intention to impose the duty on the purchaser or person paying cannot reasonably be inferred (e) . Illust. — 1. Sub-article t is the only part of the fore- going article which requires illustration. Where the trust is for payment of general debts either alone or in priority to specified debts or legacies, the purchaser is discharged from seeing to the application of the purchase-money; because the trustee has to ascertain and test the validity of all debts which may be alleged to be due, and there- fore the trusts of the purchase-money are not simple trusts (/); and a simple exemption holds where the pur- chase-money is to be applied in the purchase of other lands ( g), or on other special trusts. But where the trusts of the purchase-money are to pay certain specified debts or specified legacies, so that the parties entitled are clearly ascertained by the settlement, and if there is no other evi- dence of the intention of the settlor to exempt the purchaser from seeing to the application of the purchase-money, he will be bound to do so. For in equity the cestuis que trust are the absolute owners, and the trustee is a mere instrument or agent, and therefore the cestuis que trust are the persons to receive the purchase-money, and to give a valid receipt for it (A). It is, however, humbly conceived (c) See Story, ^ 1134, and oases 420; Forbes v. PeacocJc, 1 Ph. 717; cited as iUustrations, infra. liobitison v. Lowater^ 5 D., M. & {d) Dart, 597, othed. ; Soivarsly G. 372 ; Re Langmead, 1 D., M. & V. Lacetj, 4 Mad. 142 ; Zarcnder Gr. 353. T. Stanton, 6 ibid. 40 ; Balfour v. (g) Doran y. Wiltshire, 3 Sw. Wetland, 16 V. 151; Hreedon v. 699. Breedon, 1 E,. & M. 413. (/() Wethtrbij v. St. Giorgio, 2 {e) Dart, 596, 5th ed. ; and see Ha. 624 ; Johnson v. Kcnnetl, sup. ; gcaexaWy JSUiottv.Mcmjman, sup. Horn v. Horn, 2 Sim. & St. 448; (/) lilUott V. Merryman, sup.; Lloyd v. Baldwin, 1 V. sen. 173; Johnson v. Kennett, 3 M. & K. Ithell v. Beane, ibid. 215; Sinks 624 ; Sand v. Fland, 4 M. & C. v. lord Bokeby, 2 Mad. 238. SEEDSra TO APPLICATION OF PHECHASE-MOIfET. 199 that if the doctrine that a power to give valid discharges is to be implied where the trustee has some unascertained duty to perform mth the purchase-money before paying it over to the cestuis que trust were carried to its logical con- clusion, it would apply to cases in which the purchase- money is to be distributed among specified persons ; but the trustee is directed to first pay thereout all' expenses of the sale. For it does not seem reasonable to suppose that the settlor intended to impose on the purchaser the duty of ascertaining that the costs deducted were properly in- curred at all, or if properly incurred were properly taxed before payment. It is difficult to see wherein such a case differs from a general charge of debts, inasmuch as the ascertainment of the expenses of the sale would require quite as much circumspection and trouble on the part of the purchaser as an investigation into the settlor's general debts. However, I am not aware that the doctrine has ever been pushed to this extent; and it is not considered very probable that the court would do so now. 2. Where the trust was to pay certain specified sums and then to invest the residue, it was held that the purchaser was bound to see to the payment of the specified sums. 3. But where a testator devised certain land unto Ms children, "the same to be sold when the executors and trustees of this my last wiU shall see proper to dispose of it, and the money arising out of my said lands and tene- ments to be equally and severally divided among my above named children," some of whom were infants, it was held that the trustees could give valid receipts, the Vice-Chan- ceUor saying : " It is plain the testator intended that the trustees should have an immediate power of sale. Some of the children were infants, and not capable of signing receipts. I must, therefore, infer that the testator meant to give to the trustees the power to sign receipts, being an authority necessary for the execution of his declared pur- pose" («). ('■) Soicarsh-j v. Lrccu, siqi. 200 CONSEQUENCES OF A BEEACH OE TEITST. 4. On the otlier hand, where the intention on the part of the testator cannot be implied, as for instance, where he contemplates that all the cestuis que trust wOl be sui juris at the date of sale, but in fact one or more of them labour under some disability (as, for instance, if one dies and his representative is an infant) at that date, the purchaser will have to see to the application of the purchase-money; for the rule of law depends upon construction or intention, and not convenience (/c). 6. As the rule depends upon implied intention, an im- plied power to give valid discharges is not taken away by the fact that, at the actual date of sale, the status of the parties interested is such as would have rebutted the pre- sumption had the settlor had such status in his contempla- tion at the date of the settlement (I). For instance, where a testator devises property to trustees upon trust to sell and pay debts generally, and subject thereto upon trust for A. B., the non-existence of debts at the time of sale is, in general, immaterial; for the testator contemplated that there would be some, and therefore intended to give the trustees power to give valid discharges (to). But if the sole object of the trust was to pay debts, and the purchaser knew that there were none, or that they had been paid, he will of course not be justified in paying the purchase-money to the trustee, for the sale would in such case be itself a breach of trust, and the purchaser taking with notice would of course be responsible under Article 75 (re). 6. It may here be mentioned that on similar principles where there is a charge of debts and a power of sale in the event of the personal estate proving deficient, the purchaser need not concern himself to ascertain whether there is a deficiency in the personal estate (o). (7c) Dart, 597 and 599, h'Ciy ed. («) Watlcins v. Chcelc, 2 S. & S. {l) Ibid. 600. 199 ; Eland v. Eland, sup. (m) Tories v. Peacock, 1 Ph. (o) Greetham v. Cotton, 13 "VV. 721; Saiin Y. Seape,^' 'B. bbZ; E. 1009 ; 5ic(? v. -Fo-r, 11 Ha. 40; Balfour v. Welland, 16 V. 151. but see Pierce v. Scott, 1 Y. & C. Ex. 257. INDEX. ABROAD, trustee residing, may be removed, 149. ACCELERATION of a trust for sale, breaoli of trust, 119. ACCEPTANCE OP A TRUST, 88 et seq. prior agreement not equivalent to, 87. taking- out probate equivalent to, 88. interfering with trust property generally equivalent to, 88, 89. ACOOUNTS, trustee should be ready with, 125. trustee entitled to have his, gone through and settled or im- peached, 164. ACCUMXTLATION. See Peepetuitees. direction for, until a given age generally futile, 142. ACQUIESCENCE. See Concttbeence and Laches. in voluntary trust after learning its true nature, 45. ACTIONS, trustee the proper plaintiff in, regarding the trust pro- perty, 101. ACTS of the settlor, when admissible to rebut presumption of trust, 26, 74. ADVANCEMENT of infants, 134. And see Resultinq Tetjbi (3). ADVANTAG-E, trustee must not gain any, from trust, 127 et seq. ADVERSE TITLE. See Jus Teeth. ADVICE, trustee committing breach of trust in pursuance of legal, not indemnified,- 104. of judge, trustee may get, 165. under what circumstances given, ih. AGE, attempt to restrain enjoyment of property untU a given, gene- raUy futile, 142. AGENT is a constructive trustee, 79. when trustee may employ an, 112 et seq. how far trustee Uable for defaults of, ib. ALIEN may be a cestui que trust, 43. may be a trustee, 85. 202 IJTDES. ALIENATION. See Anticipation. ALLOWANCE. See Saiabt and IIbimbub3ement. ANNXJITT, person for whom an, is directed to be purchased may claim money, 143. even though anticipation be restrained on pain of forfeiture, si. ANTICIPATION, restraint on, generaUy void, 33—140. aliter, in case of pay, pensions or property inalienable by statute, 28, 29. aliter, in case of married woman during coverture, ib. maiTied woman restrained from, cannot release a breach of trust, 157. not liable for fraud, 190. may nevertheless bar estate tail, 141. APPEAL by trustee is at his own risk, 167. APPOETIONMENT of purchase-money on a Joint sale, 113. ARTICLES, marriage, construed liberally. See Executoky Teusts. ATTORNEY. See Solioitoe. AUTHORITY of trustee. See Powees. of cestui que trust. See Cestui que teust. BANK ANNUITIES. See Investment. BAI^KER, when trustee, liable for failure of, 116. trustees may remit money through, 117. BANKRUPT TRUSTEE may be removed, 148. BANKRUPTCY, trust for personal enjoyment notwithstanding, is iUegal,-32. trust until, and then over, good, 33. a voluntary settlor cannot settle upon himself until, and then over, ib. what settlements are void against the settlor's creditors in, 53. of trustee, 100. trust property not divisible amongst Ms creditors, if recog- nizable, ih. ahter, where it cannot be identified, 101. of agent or factor, money of principal not divisible among creditors, 100. BARRING- ENTAIL, manied woman restrained from anticipation is capable of, 141. BILL IN PARLIAMENT, trustee may oppose, 132. INDEX. 203 BEEACH OP TRUST. See Cohoueeenoe ; Eelease ; Tenant foe Life ; Maeeied 'WoMAif ; Infant ; "Waivee ; Laches. trustee retiring to enable co-trustee to commit, is liable, 110, 154. gaiuer by, must, pro tanto, indemnify the trustee, 163. loss by, generally a simple contract debt, 173. loss by, a joint debt from tbe trustees, ib. measure of trustee's responsibility for, 175. ■where interest payable by trustee, ib. where trust money actively used in trade, 176 — 179. unreasonable delay in investing trust moneys, ib. improperly calling in investments, ib. mixing' trust moneys "with private moneys, ib. property acquired by trustee out of trust funds is liable for, 182. "where set-ofl of gain against loss allo-n'cd, 184. injunction to prevent, ISO. appointment of receiver to prevent, ib. fraudiilent, is a crime, 188. cestui que trust party to, is liable to extent of his interest, 190. ahter, if legal o-wner, 191. third persons parties to, are liable for, 192. ho"w far trust property may be f ollo'wed into hands of third parties claiming under a, 193. BEOKEE, -when trustee liable for default of, 116. CESTUI QUE TEUST, definition of a, 2. an apparent, is not al"ways one in reality, 17- "who may be a, 43. corporation, ib. alien, ib. must be a h"uman being, ib. infant. See Advancement ; Concueeenoe ; Maintenance ; and Eeiease. authoiity of, 139 et seq. in simple trusts, ib. of one out of many in a special trust, ib. may freely assign his interest, 140. alitor, "where married "woman restrained from atticipation, ib. "where all concur in a special trust, 141. are collectively the absolute 0"wners, 142. no restraint can be put upon their absolute enjoyment "where they are the only people interested, ib. married "women may be restrained, ib. concurrence of, in breach of trust. See Conctteeenoe. release by. See. Eelease. laches of. See Laches. CHAEGrE, raises a trust, 11. no resulting trust of residue after payment of, 66. Statute of Limitations applies to a, 161. CHATTELS, trust of, may be declared by parol, 37. CHILD, fe Advancement ; Maintenance; Eesultino TEtrsi (3) . 204 INDEX. CHOSE in action, purchaser of, takes subject to all equities, 193. CLASS, power of disposal among a, raises a trust, 12. CLEEGTMAN, undue influence of, 46. COMMISSION. See Salary. COMPANY. See Intestment and Dieeotoes. COMPOUND INTEREST. See Interest. CONCUKRENCE of cestui que trust in breaoli of trust, 157. CONDITIONS of sale. See Sale. trustees must fulfil all, 119. CONFIDENCE, the root of a trust, 1. CONFIRMATION. See Waivee and Release. CONFLICT of duty in trustee, 187. CONFORMITY. See Receipts. CONSENT where required must he obtained, 119. CONSIDERATION. See Valuable CousrozEATioN. CONSTRUCTION. See Executed and Execotoey Teusts. CONSTRUCTIVE TRUSTS AND TRUSTEES, 63 et seq. And see RESULima Tetists. summary of, 63. profits made by persons holding fiduciary positions, 77. by tenants for life, ib. by joint tenants, ib. by mortgagees, ib. by partners, directors, or promoters, 78. by agents and solicitors, 79. vendors and purchasers are, for each other, 80. equitable mortgagors are, 81. mortgagee's heirs were formerly, ib. mortgagee in possession is a, ib. may purchase from cestui que trust, 128. CONTINGENCY. See Tetjst Peopeett. CONTRACT. See Covenant. CONTRIBUTION among trustees, 173. CONVERSION. See Followino Teust Peopeett. COPYHOLDS, voluntary covenant to surrender, not enforceable, _21. trustee can demand admission to, 102. INDEX. 205 COSTS. See Retieeiient ; Eesioval ; and Couet. direction for payment of, does not make employes cestuis que trust, 18. CO -TRUSTEE, trustee cannot reKeve himself of responsibility by deputing his duties to, 112. may be safely permitted to receive, but not to retain trust moneys, 117, 118. ■when trustee answerable for defaults, acts, or receipts of, 154. opinion of Lord "Westbury as to responsibility for, 155. COURT, when trustee may pay into, 166. effect of paying trust money into, %b. ■what sufficient justification for paying into, 167 et seq. trustee instituting a suit in, 167. ■what ■will justify a trustee in instituting a suit in, ih. appointment of ne-w trustees by. See New Trustee. retirement of trustee under sanction of. See Retieement. COVENANT to settle raises a trust ■when based on value, 19. aliter, ■where voluntary, 21. duty of trustee to enforce against settlor, 106. CREATION OF TRUST. See Deolabed Tbust. CREDITORS, trustee personally liable to, of business carried on by him, 102. ■where trust is for payment of debts, are not generally cestuis que trust, 17. settlement intended to defeat. See Vallditt (2) . of settlor on bankruptcy. See Bajteeuptct. CROWN. See Failtjee oe Cestuis otje teust. DAMAGES recovered from the trustee may be recovered out of the trust estate, 153. DEATH of trustee. See Estate. powers survive to co-trustees, 145. devolution of office on,. of last surviving trustee, 146. DEBTS, trust for payment of, when illusory, 17. may be the subject of a trust, 40. trustee may release or compound, 105. should exercise reasonable discretion as to realization of, 104. should prove, on bankruptcy of debtor, ih. should generally realize within a year, 109. DECLARATION of trust, what is a prima facie valid, 9. when writing necessary. See 'WEiTrNQ. DECLARED TRUST, analysis of, 9. creation of, W et seq. language. See Laugttage. T^hen illusory. See Illtjsoet Tbust. 206 IJTDEX. DECLARED TRUST— continued. creation of — continued. formalities immaterial where based on value, 19. covenant sufficient, ii. no trustee appointed immaterial, 20. formalities material when trust voluntary. See Volttntabt Teust. object of the trust. See Illeoai, Tetjsts. necessity of writing. See WEimfG. validity of. See Validity. construction of. See Consteitction. DELAY. See Inteeest and Laches. DELEGrATION of trustee's duties, generally not permitted, 112 etseq. of trustee's powers, 135 et scq. • ' DESIRES. ' ' See LAuauAQE. DEVISE of trust estates, 99. pass under a general devise, ii. of the office of trustee, 147. DEVISEE. See RES-oxTiira Teusts. of trustee, when he can execute a special trust, 147. DEVOLUTION of trustee's estate, 98. of the office of trustee, 146. DIRECTION, words of, raise a trust, 11. trustees should obey the, of the settlement, 119. DIRECTORS are constructive trustees, 78. DISCHARGE, trustee entitled to, on completion of trust, 164. not entitled to a, under seal, ip. DISCLAIMER, 85 et seq. DISCRETION, powers involving, cannot be delegated, 136. trustee should exercise a reasonable, 104. DISTRIBUTION, power of, can only be exercised by the donee, 137. of trust fund, trustee must pay to right cestuis que trust, 110. alitor, if - cestui que trust dead, 156. DOUBT, in cases of, trustee may apply to the court, 122. may pay money into court, 167. may institute a suit, ib. DOUBTFUL EQUITY, notice of, does not bind a purchaser, 195. DOWER attaches to estate of trustee, 101. DUTIES OE A TRUSTEE. See Saie; Pueohase; and Invebiment. must exercise reasonable care, 104 et seq. not excused by acting under skilled advice, ih. should realize debts with reasonable speed,' ib. may allow time where expedient, ib. may release or compound debts, ii. should enforce covenants agaiast settlor, 106. ESTDEX. 207 DUTIES OP A TRUSTEE— ««««(«<;. should register trust instrument where necessary, 106. duties of trustees for sale. See Saxe. duties of trustees for purchase. See Pueohase. duties of trustees for investment. Sod Investment. not g-euerally liable for pure error of judgment, 109. not liable if trust property stolen without their fault, ib. aliter, if obtained by fraud or forgery, 110, 111. need not iusm-e premises, 109. delegation of duties, 112. ^«£? s«« Deleqation. must obey the terms of the settlement, 119. must not favour particular oestuis que trust, 120. must not administer trust property so as to throw an undue bur- then on tenant for life or remaindermen, ib. must not set up jus tertii, 121. should be ready with accounts, 125. must not profit by trust, 126. must not purchase the trust property, ib. must generally act gratuitously, 129. EARMARK, when trust property has an, it can be followed, 182- ELECT, person may, to take money bequeathed upon trust to pur- chase an annuity for him, 143. can elect, even though forbidden to sell or alienate annuity, ib. person cannot, to take his share of real estate directed to be sold, unless the other cestuis que trust concur, 144. ENJOYMENT, attempt to fetter generaUy futile, 142. ' ' ENTREAT. ' ' See LAuatrAaE. EQUITABLE ESTATE, definition of , 2. EQUITABLE MORTGAaE, mortgagor a constructive trustee, 81. is subject to all prior equities, 196. EQUITIES, where there are any, the legal owner is a constructive trustee unless he is a purchaser without notice, 79. ESTATE OE TRUSTEE, 90 et seq. where he takes any estate, ib. the quantity of his estate, 92. prima facie takes a fee, ib. and 96. indefinite chattel iaterests abolished, 93, 98. devolution of. See Devolution. devise of, 99. passes under a general devise, ib. aliter, if inconsistent, ib. incidents of, at law, 101. absolute on failure of cestui que trust, 103. ESTATE TAIL. See BAUEiNa. EVIDENCE, when parol, admissible to prove an express trust, 37 e< seq. when parol evidence admissible to prove a resulting trust. See Resiji.iin(} Trust. 208 INDEX. EXECUTED TRUSTS construed strictly, 57 et seq. EXECUTOR, one may remit money to another, 116. of last surviving trustee, when he may execute a special trust, 146. EXECUTORY TRUST, construed liberally, 57 et seq. marriage articles, "issue," hoTv construed in, 59. construed strictly where parties understood' the terms they used, ib. wills, ib. intention of the testator is to prevail, ib. separate use of married woman may be implied, 62. EXPECTATION, mere words of, will not raise a trust, 14. EXPECTATIONS, agreement to share, valid, 28. EXPENSES, reimbursement of trustees, 153 et seq. direction to pay, does not make employes cestuis que trust, 18. EXPLANATION, words of. See Lauqtjaoe. EXPRESS TRUST. See Declabed Teust. FACTOR, money of principal in the hands of insolvent, can be claimed by principal if capable of identification, 100. FAILURE of trust by lapse, &c. See Resttlthig Teitst. of cestuis que trust, 103. trustee takes realty absolutely, ih. crown takes personalty, ib. where trustees are for other trustees, the latter take, ib. mortgagee upon failure of mortgagor's heirs takes absolutely, ib. FATHER. See RESUMiNa Tbtjst (3) : and as to undue influence of, 46. FAVOUR, trustees must not unduly, one cestui que trust, 120. FEE SIMPLE, when the trustee takes, 92. FELON trustee, the court wiU remove a, 148. whether he may be a settlor, 43. FEME CONVERT. See Maeeied 'Woman. FIDUCIARY PERSONS are constructive trustees, 77. FOLLOWING TRUST PROPERTY in the hands of the trustee, 100. into the hands of third parties, 193. or into that into which it has been converted, 182. FORaED AUTHORITY, trustee Hable if he pays money under, to wrong person, 110. INDEX. 209 FORMALITIES unneeeasaiy trhere trast based on value, 19. necessary -where trust is voluntary, 20. PEAUD of settlor. See IlESirLTiN& Teust (2) and Validity. whereby a settlor is induced not to make a will or not to comply with Statute of Frauds, 40. converts a wrongdoer into a trustee, 82. a secret agreement to share expectant legacies is not a, 28. of trustee's solicitor, whether trustee liable for, 113, 115. infants and married women are liable for, 85, 157, 159. ^ alitor, where married woman is restrained from anticipation, 157, 159. FRAUDS, STATUTE OF. See ■Weitihg. FRAUDULENT breach of trust a crime, 188. intention of settlor does not estop him claiming a resulting trust. See Resulting Tetjst (2) . GAINER by breach of trust must pro tanto indemnify the trustee, 163. G-IFT, imperfect voluntary, is not equivalent to a declaration of trust, 21 et seq. voluntary when it raises a resulting trust. See RESULTrtro Teust (1) and (3). GUARDIAN, undue influence of, 44. HEIR. See Resulting Teust. of last surviving trustee, when he may execute a special trust, 146. "HOPES." jSeeLANOUAaE. HUSBAND of woman to whom property is given for her separate use is a trustee, 19. IGNORANCE. See Validity. ILLEGAL TRUST, ZOetseq; and seeVERVETUiTiES; Thellusson Act ; Bankeuptct; Anticipation; Illegitimate Chiliieen ; ««. TENANT FOR LIFE a constructive trustee, 77. must not avail himself of his position to profit at the expense of remaindermen, ii. trustee must not unduly favour, 120. when allowed possession of trust property, 140. if o-ainer by breach of trust, must recoup the trustee, 163. if party to breach of trust, the other cestuis que trust have a lien on his interest, 192. vfTongfuUy converting trust property, 183. THELLUSSON ACT, 32. TJ.T. 218' INDEX. THIRD PARTIES, trustee must not set up adverse rights of, 121. where trustee believes in honS, fide claims by, he may take direc- tion of the court, 122. See also Peopeety; Ptjbchasebs ; and Followino Tetist Peo- TIMBER, trustees should not buy an estate with large proportion of, 120. should not sell, to pay debts, ib. may cut down, when arrived at maturity, 131. alitor, where legal rights would be interfered with, 134. TRADE, trustees employing trust property in their own, liable to account for profits or to pay compound interest, 177 — 179. trustees may not charge for managing a, 130. TRUST, definition of a, 1. TRUSTEE. See Consteuotive Teust ; REStrLiiNO Teust ; Aooept- AKCE ; DisoLAiMEE ; Estate of Teitstee ; Duties of Teustee ; PowEES OF Teustee ; Beeaoh of Teust ; and Peotection. definition of a, 2. executive, definition of a, 4. bare deiinition of a, 3. where none appointed, 19, 21. who is a fit person to lie a, 83. infant, ib. married woman, 85. alien, 84. bankrupt, 184. voluntary settlement upon a, 44. TRUSTEE RELIEF ACT. See Cotjet. TRUST PROPERTY, definition of, 2. what it may legally consist of, 26 et seq. equitable property, 27. reversionary property, ib. possibility, 28. expectant legacy, ib. salary, ib. pension, ib. pay, 29. property inalienable by statute, ib. following, in the hands of third parties, 193. does not pass to the creditors of bankrupt trustee, 100. inSrCERTAINTT. See Lanouaoe and RESniTiNO Teust (1). UNDISPOSED of equitable estate, results. &c RESUMma Teust (1). UNDUE preference of one cestui que trust. See Favoub. influence. See Validity. UNFIT AND INCAPABLE, meaning of, 151. INDEX. 219 VALIDITY or A TEUST, as to object. See Illeqai, Teitst (i; As against the settlor, 44 et seq. fraud, 44, 47. undue influenoe, 44. of clergyman, 46. of father, ib. of guardian, 44. of legal adviser, il. of doctor, ih. of trustee, ih. ignorance of the effect of the settlement, ih. illness, 46. inexperience, 45. old age and infirmity, 47. mistake, ih. even where value given, ih. subsequent acquiescence validates, 45. onus of proving validity of a voluntary settlement, ih. power of revocation in voluntary settlements not essential to, ih. (2) As against creditors, 47 et seq. direct intention to defraud, 49, 50. settlement to avoid execution, 50. settlement on self vmtil bankruptcy, 51. where no direct intention to defraud, but the necessary con- sequence of settlement would be to do so, ih. assignee for value, how far bound by notice of the effect of his purchase, ih. (3) As against creditors in bankruptcy, 53. (4) As against suhseqwnt purchasers, 54 et seq. direct intention to defraud, ih. voluntary settlements always bad in the hands of cestuis que trust against, ib. YSTj smaU consideration sufficient to protect cestuis que trust, 55. power of revocation always makes settlement bad as against, 54. notice to purchaser immaterial, ih. collusion between settlor and purchaser, 56. cestuis que trust have no equity to the purchase-money, ih. purchasers from the cestuis que trust are protected, 55. such settlements are only void pro tanto, 56. VALUABLE CONSIDERATION, what trusts are based on, 4. where there is, formalities are im m aterial, 19. where there is not. See Voiuntaby TEtrsT. marriage is a, 5. what limitations ia a marriage settlement are not based on, ib. limitations in favour of children of a former marriage are based on, 7. VENDOR, constructive trustee for purchaser, 80. must take reasonable care of estate before completion, 110. 220 INDEX. VESTINGr property in new trustees, 160. VOLXJNTART TRUST. See Vaiuablb Consideeation. when prima facie valid, 20 et seq. must be. an executed trust, 20. imperfect gift not enforceable, 23, 24, 25. mere covenant to settle not enforceable, 21. when settlor has done aU in his power to create an executed trust, 22. conflict of authorities, 24. when invalid from something attending its inception. See Yali- DITT (1). when invalid as against creditors. See Vaijdity (2). when invalid as against creditors in bankruptcy, 53. when invalid as against subsequent purchasers. See VALrornr (4). VOLUNTEER, 20 et seq. assignee of a lease cannot be a, 5. donee of trust property under a iDreach of trust cannot retain it, 1 94 . See also Voltintaet Teust and Vai,tjaele Consideeation. WAIVER of breach of trust, what amounts to, 168. "WELL KNOWS." See liUsavKas. WORDS. See Lanoitaoe. WRITINGr, necessity of, in declarations of trust of real estate and leaseholds, 37. aliter, in personal property, ih. what the writing must show, 38, 39. where fraud handwriting unnecessary, 40. resulting trust, where declared trust was not reduced into, 66. London : Printed by C. F. Rowortli, Breani*s Buildings, Chancery Lane. /^M ^^ 7 LAW "WORKS FOE, STUDENTS. Mozley and Whiteley's Concise Law Dictionary. 8vo. 20s. cloth. *' Law students desirous of cramming -will find it acceptable." — Law Times. Mr. Serjeant Stephen's Commentaries on the JjO/ws of England. Seventh Edition. By James Stephen, Esq., LL.D., Judge of County Courts, &c. 4 vols. 8vo. il. is. cloth. 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