Div. I. CHAPTER III. Notice before actual payment of all the purchase-money, (although PART III. it be secured (a), and the conveyance actually executed (b),) or before the execution of the conveyance, (notwithstanding that the money be paid (c),) is equivalent to notice before the contract. Notice when given. How to be The plea of a purchase for valuable consideration without notice, when pleaded in bar to a suit, should state the conveyance (d); and pleaded. it must contain an averment, that the vendor was seised or pretended to be seised at the time of the conveyance (e), and also that he was then in possession (ƒ) (unless the estate be reversionary, in which case the state of the title must be shewn by the plea (g)). There must also be an averment, that the consideration money was bonâ fide and truly paid (h). However a valuable consideration, such as that of marriage, will be sufficient to support a plea of purchase without notice, if it be properly stated (i). Moreover the plea must deny notice of the plaintiff's title or claim before the execution of the conveyance and payment of the consideration; for till then the transaction is not complete (k); and this denial must be made, whether the notice is charged in the bill or not (). And if there are particular charges of notice, they must be specially denied (m); although if there are no such particular charges, the denial of notice may be general (n). However the denial must be positive (o), and it must not be confined to personal notice, for that would raise an inference, that notice had been given to the defendant's agent, which is a fact equally material (p). If the notice be proved by only one witness, and it is positively and Notice, how proved. expressly denied by the answer, there will be no decree against the defendant (9), unless the evidence of the witness be corroborated by (a) Moore v. Mayhew, 1 Ch. Ca. 34; Tourville v. Naish, 3 P. Wms. 307; Story v. Lord Windsor, 2 Atk. 630; Hardingham v. Nicholls, 3 Atk. 304. (b) Jones v. Stanley, 2 Eq. Ca. Abr. 685. (c) Wigg v. Wigg, 1 Atk. 384; 2 Sugd. V. & P. 274, 9th edit. (d) Aston v. Aston, 3 Atk. 302; Harrison v. Southcote, 2 Ves. 396; 2 Sugd. V. & P. 304, 9th edit. (e) Story v. Lord Windsor, 2 Atk 630; Head v. Egerton, 3 P. Wms. 279; Walwyn v. Lee, 9 Ves. 32; Jackson v. Rowe, 4 Russ. 514. (f) Walwyn v. Lee, 9 Ves. 32; Jackson v. Rowe, 4 Russ. 523; Trevanian v. Mosse, 1 Vern. 246. (g) Hughes v. Garth, 2 Ed. 168; Ambl. 421. (h) Moore v. Mayhew, 1 Ch. Ca. 34; Maitland v. Wilson, 3 Atk. 814; Molony v. Kerwan, 2 Dr. & W. 31; see 2 Atk. 241. (i) Jackson v. Rowe, 2 S. & St. 475. (k) Lady Bodmin v. Vandebendy, 1 Vern. 179; Moore v. Mayhew, 1 Ch. Ca. 34; (1) Aston v. Curzon, Weston v. Berkely, (m) Meder v. Birt, Gilb. Eq. Rep. 185; Radford v. Wilson, 3 Atk. 815; Jerrard v. Saunders, 2 Ves. jun. 187; 4 Bro. C. C. 322; 6 Dow. 230. (n) Pennington v. Beechey, 2 S. & St. (0) Cason v. Round, Prec. Ch. 226. (q) Alam v. Jourdon, 1 Vern. 161; King- PART III. CHAPTER III. Div. I. Mere suspicion not sufficient proof. Parol proof sufficient. Notice of voluntary settlement, how far material. other circumstances (r). But the denial must be positive, and an answer as to belief only will not be sufficient, in contradiction to what has been positively sworn (s). If the evidence of notice be not sufficiently clear for the court to make a decree, it will be sent to law to be tried (t). The counsel, attorney, or agent, of the purchaser cannot be admitted to prove the notice against him, upon the general principle of law, that parties in that confidential situation ought not to be allowed to disclose the secrets of their clients, where the knowledge of them has been acquired in their professional capacity only, and not independently of that character (u); and this is the privilege of the client, which the attorney, &c. will not be suffered to violate by making a voluntary deposition as to the fact to be proved (x); although Lord Hardwicke, and also Sir J. Strange, appear to have maintained a contrary doctrine on this last point (y). We have already seen that possession of a deed is primâ facie evidence of notice of its contents (z); and it lies upon the purchaser to rebut that presumptive evidence by showing that t came into his possession after the purchase (a). The evidence must distinctly show, that notice was actually received; for the court will not act upon what amounts to mere suspicion (b): and a purchaser is not obliged to enter into the interpretation of doubtful facts or expressions (c). But it is obviously very difficult to lay down any general rule as to what will amount to sufficient proof of actual or constructive notice. The gradation between mere rumour or suspicion and positive information is so indefinite, that each case must necessarily depend on its own peculiar circumstances (d). It has been already observed, that notice by parol declarations is sufficient for all purposes (e). A purchaser for valuable consideration will not be affected by notice of a prior voluntary conveyance: and therefore where the owner of an estate has voluntarily constituted himself a trustee for other parties, he may notwithstanding make a good subsequent conveyance of it to a purchaser, who has been made acquainted with the voluntary settle (r) Walton v. Hobbs, 2 Atk. 19; Anon. 3 Atk. 270; Only v. Walker, 3 Atk. 407; Pember v. Mathers, 1 Bro. C. C. 52; East India Company v. M'Donald, 9 Ves. 275; Biddulph v. St. John, 2 Sch. & Lef. 521. (s) Arnott v. Biscoe, 1 Ves. 97; Pilling v. Armitage, 12 Ves. 78. (t) 1 Ves. 95; 2 Sugd. V. & P. 301, 9th (u) 2 Sugd. V. & P. 298, 9th edit. (y) Maddox v. Maddox, 1 Ves. 62; Bishop of Winton v. Fournier, 2 Ves. 445. (z) Whitfield v. Fausset, 1 Ves. 392; Mertins v. Joliffe, Ambl. 313. (a) Earl of Pomfret v. Ld. Windsor, 2 Ves. 486. (b) Hine v. Dodd, 2 Atk. 276; Howarth v. Deane, 1 Ed. 351. (c) Kenney v. Brown, 3 Ridg. P. C. 512; Warwick v. Warwick, 3 Atk. 291; Senhouse v. Earle, Ambl. 285; 2 Ves. 450; Att.-Gen. v. Backhouse, 17 Ves. 293. (d) 1 Story, Eq. Jur. 322. (e) Weymouth v. Boyer, 1 Ves. jun. 425. ment (f). However a purchaser, who has notice of a voluntary settlement, could seldom be advised to complete without inquiring into all the circumstances connected with it; for if it should turn out that the settlement, though apparently voluntary, was founded on any valuable consideration, the trusts would undoubtedly be enforced against him, although the settlement itself contained no actual recital or notice of that fact (g). And parol evidence is admissible to prove the consideration in support of the settlement (h). PART III. Div. I. CHAPTER III. trustees without taking from Second pur chaser without notice, taking from purchaser with notice, not bound by the trust. It has been already seen, that a trustee, who takes by a voluntary Volunteer conveyance from a trustee, will be bound by the trust, although he may have had no notice (i). And this equity would doubtless be enforced to the same extent, where the consideration is merely nominal or collusive, or so inadequate as to amount to evidence of some fraudulent dealing (k). But if the consideration be valuable, the court will not in general enter into the question of its adequacy, unless the disproportion be so gross as in itself to suggest fraud (1). If the conveyance by the trustee be not only voluntary, but also with notice, the party taking under it will à fortiori be bound to execute the trust (m). Where a purchaser with notice from a trustee conveys for valuable consideration to another person, who has no notice of the trust, the estate will not be affected with the trust in the hands of the second purchaser (n). However in such a case the first purchaser will not be discharged from his liability, but will be compelled to account with the cestui que trust for the purchase-money, which he has received (0). Where an estate has once been purchased for valuable consideration without notice of any trust, a subsequent purchaser will hold discharged from the trust, though he purchased with notice; for he will have the benefit of the want of notice by the intermediate vendor. The reason is to prevent the stagnation of property, and the injury, which might otherwise be occasioned to an innocent purchaser (p). But this rule will not be applied, where the property is re-purchased by the original trustee or by a previous purchaser with notice; for the consciences of such persons would remain affected with the original trust, which would re-attach on the property, whenever and by whatever title it should return into their possession (g). (f) Taylor v. Stile, 2 Sugd. V. & P. 159, 9th edit. ; Evelyn v. Templar, 2 Bro. C. C. 148; Buckle v. Mitchell, 18 Ves. 112; Pulvertoft v. Pulvertoft, ib. 84; Powell v. Pleydell, 1 Bro. P. C. 124. (g) Ferrars v. Cherry, 2 Vern. 384. (h) Chapman v. Emery, Coop. 278; 2 Sugd. & V. & P. 170, 9th edit. (i) Pye v. George, 1 P. Wms. 128; Mansell v. Mansell, 2 P. Wms. 681; 1 Cruis. Dig. Tit. 12, Ch. 4, s. 16; ante, Pt. I. Div. II. Ch. II. Sect. 2. k) Bullock v. Sadlier, Ambl. 776. (1) Bullock v. Sadlier, Ambl. 763; see Gwynne v. Heaton, 1 Bro. C. C. 8; Gibson v. Heyes, 6 Ves. 273. (m) Mansell v. Mansell, 2 P. Wms. 681 (n) Ferrars v. Cherry, 2 Vern. 383; Mertins v. Joliffe, Ambl. 313. (0) Ferrars v. Cherry, 2 Vern. 383. Harrison v. Forth, Prec. Ch. 51; Mertins v. Joliffe, Ambl. 313; M'Queen v. Farquhar, 11 Ves. 478; Lowther v. Carlton, 2 Atk. 242; Brandlyn v. Ord, 1 Atk. 571. (g) Kennedy v. Daly, 1 Sch. & Lef. 379. or second purchaser with notice taking from purchaser without notice.. Secus, where second pur chaser is the original trustee. PART III. CHAPTER III. Purchase with out notice is no defence unless the purchaser has obtained the legal estate. Not compellable to discover his title. Favoured in equity. Who considered a purchaser. Where he answers must answer fully. A purchase for valuable consideration without notice will not be a complete defence in a court of equity, unless the purchaser has clothed himself with the legal estate (r). For it has been at length settled, (although not until after much fluctuation of opinion,) that a plea of such a purchase is no defence in equity to a claim under a legal title (s). But although the purchaser has not secured the perfect legal title, the court will not compel him to make any discovery, which may hazard his possession, even on the suit of a person, who claims by an alleged legal title, for the defendant has in conscience an equal right with the plaintiff (t).* And as a general rule a purchaser for valuable consideration without notice is regarded with favour in a court of equity, which will not take the least step against him (u). A mortgagee (x) and for some purposes a lessee (y) will be considered a purchaser for valuable consideration. For although a lessee will be held to have notice of his lessor's title, so as to know, that he was only a trustee; yet if the lease were within the scope of the trustee's powers, the lessee will not be supposed to have known that it was actually a breach of trust, unless it be proved that he was aware of that fact (z). We have already seen that marriage is a sufficient consideration to support a purchase for valuable consideration within the principles that have just been discussed (a). (r) See Branlyn v. Ord, 1 Atk. 571. (t) Gait v. Osbaldeston, 1 Russ. 158; Saunders, 2 Ves. jun. 458; see Wilkes v. (u) Jerrard v. Saunders, 2 Ves. jun. 458. (x) Brotherton v. Hutt, 2 Vern. 574. (a) Jackson v. Rowe, 2 S. & St. 475. * However if a defendant put in his answer raising the defence of purchase for valuable consideration without notice instead of protecting himself by plea, it is the settled practice of the court, that he may be compelled to answer all the allegations in the bill fully. Bovey v. Leighton, 2 S. & St. 234. Potarlington v. Soulby, 7 Sim. 28. DIVISION II. OF THE LIABILITIES AND PRIVILEGES OF TRUSTEES. CHAPTER I. OF A BREACH OF TRUST, AND ITS CONSEQUENCES. THE nature of a breach of trust is sufficiently obvious from what has gone before in the preceding pages, nor is it necessary to add anything here on that point. But we will now proceed to consider-1st. The nature of the remedies for a breach of trust; and 2nd. What will amount to a discharge of a breach of trust. And 1st. Of the remedies for a breach of trust. PART III. Extent of re medy at law. A suit in equity is the usual and most effectual remedy for a breach By suit in of trust. Indeed unless some legal debt has been created between the equity. parties, or some engagement, the non-performance of which may be the subject of damages at law, a court of equity is the only tribunal, to which the cestui que trust can have recourse for redress.* And in any case the jurisdiction and machinery of those courts is so much better adapted to meet the exigencies of every case by enforcing the restitution of the trust property, and compelling an account against the guilty parties, that any other remedy is rarely resorted to. contract debt. A breach of trust in general creates only a simple contract debt, for Breach of trust which (previously to the statute 3 & 4 Will. IV. c. 104) the trustee's creates a simple personal estate only was liable, and the cestui que trust had in general no remedy against the real estate (a). The same rule also prevailed at law in those cases where the breach of trust created a legal debt (b): and it was immaterial that the trust was created by a deed, executed by the trustee, and that the trust deed contained a provision, that the trustees should be liable for the monies actually received by them (c). However the assets of the trustee would be marshalled in equity in favour of the claim of the cestui que trust (d). And there are autho- When a debt by (a) Kirk v. Webb, Prec. Ch. 84; Heron v. Heron, ib. 163; Vernon v. Vawdry, 2 Atk. 119; Cox v. Bateman, 2 Ves. 19; Perry v. Phillips, 4 Ves. 108; Lyse v. Kingdom, 1 Coll. 184, 188. (b) Bartlett v. Hodgson, 1 T. R. 42. (d) Cox v. Bateman, 2 Ves. 19. specialty. and received * An action at law for money had and received will not lie against a Action at law trustee, while the trust is still open, although where a final account has been for money had stated between the parties, and the trust is closed, it seems, that such an action may be maintained. Case v. Roberts, Holt, N. P. C. 501; Edwards lies against a v. Bates, C. P., June, 1844; 13 Law Journ. N. S. 156. trustee. When? |