on the making thereof; and the deed contained no power of revocation, reservation, trust condition, limitation clause or agreement whatsoever for the benefit of the grantor, or any person or persons claiming under him. The grantor lived many years afterwards and kept the deed, and its terms were never enforced. There was evidence to show the intention of the grantor and one of the trustees, that the deed was not to take effect till after the grantor's death, though there was no evidence of any specific agreement. Held by Sir R. T. Kindersley, V. C., that as there was an agreement or understanding or design among the parties to the deed, that payment of the annuity was not to be enforced during the life of the grantor, the grant ought to be declared void. "I have no hesitation," said his Honour, "in declaring my opinion, that if such an agreement or understanding existed among the parties when the deed was executed, or if such was the design of the grantor in executing the deed, and that design was acquiesced in and acted upon by all parties, it is not necessary that such design should be expressed on the face of the deed, in order to bring the case within the Statute of Mortmain; but this Court would regard the transaction as a fraud on the Statute, and declare it void. But the onus of proving such an agreement or understanding or design rests, of course, on the plaintiffs who allege it." 12. EGERTON V. BROWNLOW. 4 House of Lords Cases, 1. Public Policy- Peerage Estate - Condition. John William Earl of Bridgewater devised his freehold estates to trustees in trust to convey them to the use of Lord Alford, his great nephew, for ninety-nine years if he should so long live; remainder to trustees to preserve contingent remainders, remainder to the use of the heirs male of the body of Lord Alford, with divers remainders over. Provided that, if Lord Alford should die not having acquired the title of Duke or Marquis of Bridgewater, the estate directed to be limited to the heirs male of his body should cease, and the estates should thereupon go over and be enjoyed according to the subsequent uses and limitations directed by his will. Lord Alford died, leaving a son, but without having acquired the title. Held, by the House of Lords, overruling the decision of Lord Cranworth, V. C., that the estate thus created in favour of Lord Alford's heirs male was not affected by the proviso, which was a condition subsequent, and which was void, as being against public policy; and that therefore the eldest son of Lord Alford was entitled to the estates as heir male under the limitation.1 Settlement― Jointure chargeable primarily upon Settlor's real Estate. By a settlement made on his marriage, a husband secured an annuity, by way of jointure, to his wife, in the event of her surviving him, by a demise of real estate to trustees for a long term of years, and then covenanted that his heirs, executors, administrators, or assigns, should pay the jointure. Held, by Sir W.P. Wood, V. C., that the estate comprised in the term, and not the general personal estate of the testator, was the primary fund for payment of the annuity. "Lord Hardwicke," said his Honour, "in Lanoy v. The Duke of Athol (2 Atk. 44.), the leading case on the subject, says in effect, that although where there is a covenant for payment the personal assets are first charged, this is not extended to provisions in a settlement; and the ground must be that which is pointed out in the argument in Lechmere v. Charlton (15 Ves. 193.), that, in a security of this description, there is not any benefit accruing to the personal estate of the party who is the debtor; but the whole arrangement is merely for the purpose of securing a jointure or portion, and the personalty not having received any benefit, the true intent is, that the real and not the personal estate should be the primary fund." 14. EXPARTE JOHN DANKES, IN THE MATTER OF JOHN FARLEY. 2 De Gex, Mac. & Gord. 936. Tender. A trader who, under a trade debtor summons, had signed an admission of a debt, went to his creditor with the amount of it in his pocket, in money, and told the creditor that he had come for the purpose of paying that amount. The creditor said it was of no use, as it was too late, and that the debtor must see the creditor's attorney. Held by the Lords Justices that the production of the money was dispensed with, and that there was a good tender. 1 For an elaborate examination of this important decision the learned reader is referred to 19 Law Review, 1. There is no rule better established or more invariably acted upon by Courts of Equity than this, - "That a trustee shall not either directly or indirectly derive any profit from the execution of his trust." The above case is a good illustration of the application of the rule. An administration suit was instituted by one trustee against B., his co-trustee, a solicitor, and the cestui que trusts, some of whom were infants. B. conducted his defence by his partner. Held by Sir J. Parker, V. C., that he was only entitled to costs out of pocket, and declined to direct an inquiry whether B., having employed his partner in the suit, had not been for the advantage of all parties to the suit. "It is," said his Honour, "the established rule (whether it be a good one or not is not now the question), that a solicitor trustee, acting for himself as solicitor in the trust, can be allowed costs out of pocket only. An exception has been made in the case of two or more trustees, where one of them, being a solicitor, acts for himself and his co-trustees in a suit; but, if ordinary costs were allowed in any case where a solicitor acts in a suit for himself alone, or, what is the same in effect, acts for himself alone by his partner, it would be to destroy the rule altogether. I must decline to make the reference asked: to make it in this case would be a precedent, on which the Court would have to make it in every case." 16. JONES V. FoxALL. 15 Beav. 388. Trust, Breach of — Trust Funds employed in Trade- Compound Interest. A trustee from the year 1834 to 1850 having neglected to withdraw a trust fund from a trading firm of which he was a member, Held by Sir J. Romilly, M. R., that he ought to be charged with compound interest at 5 per cent., and with costs. His Honour, in giving judgment, made the following important observations: "The rules which apply to the cases in which executors are charged with interest on the balances retained by them, are subject to a good deal of difficulty, arising, not so much from any doubt as to the principles themselves, as from the practical application of them to particular cases. Generally, it may be stated, that if an executor has retained balances in his hands which he ought to have invested, the Court will charge him with simple interest at 4 per cent. on these balances; if, in addition to such retention, he has committed a direct breach of trust, or if the fund had been taken by him from a proper state of investment, in which it was producing 5 per cent., he will be charged with interest after the rate of 5 per cent. per annum. If, in addition to this, he has employed the money so obtained by him in trade or speculation, for his own benefit and advantage, he will be charged either with the profits actually so obtained by him from the use of the money, or with interest at 5 per cent. per annum, and also with yearly rests, —that is, with compound interest. "The principle on which the Court charges the executor with the profits which have actually arisen from the property of his cestuis que trust employed by him, is obvious, and of general application where such profits are proved to have been made. It was the money of the cestuis que trust, and they are entitled to receive the profits it has earned. The principle upon which executors charged with interest on balances are made to account with yearly or halfyearly rests, is not so clearly defined, nor are the decided cases by any means free from obscurity or contradiction. In some cases, the Court has charged the trustee with annual rests, because the trust, under which he acted, in distinct terms required him to accumulate the fund at compound interest. In other cases, the principle seems to have been, that the Court visits the executor or trustee with an account, in the nature of a penalty for his misconduct, where he has not merely committed a breach of trust, but where he has himself endeavoured to derive, or has actually obtained, some pecuniary advantage from the use of the money, of which he has thus obtained possession. In all these cases, however, a large discretion seems to have been exercised by the Court with regard to the facts and circumstances attending each particular case; and it is to the exercise of this discretion that the obscurity in discovering the principle, in some of the reported cases, is to be attributed; and it is only on this principle that the later cases, in which the rule has been drawn more stringently against the trustee, can be reconciled with some of the earlier authorities." 17. MANT v. LEITH. 15 Beav. 524. Trust Funds. Power to invest on real Securities Loan to a Railway Company on Assignment of Undertaking, Tolls, &c. improper. 66 on real A settlement contained a power to invest trust money securities." A trustee lent it (with the consent of the tenant for life) to a railway company, on the usual assignment of the under taking, calls, rates, tolls, and all the estate &c. of the company; but the principal was not to be made payable for seven years. Held, by Sir J. Romilly, M. R., that, assuming it to be a real security, it was not a proper investment for the trustee to make; as, under the powers in the Act of Parliament, the security could not be enforced, in the ordinary way, by ejectment or foreclosure; payment could not be demanded for seven years, and could only be made available by a sale; and the parties in remainder might happen to become entitled to receive the money before the expiration of that time, and yet might be unable to realise it, except by a forced sale, and possibly at great disadvantage. 18. EXPARTE WARRINGTON, IN THE MATTER OF LEAKE, A BANKRUPT. 3 De Gex, Mac. & Gord. 159. Advances were made to a person, afterwards bankrupt, upon promissory notes, some having twelve, and others having only three, months to run, at a rate of interest above 5l. per cent., and which were further secured upon leaseholds by a contemporaneous agreement. Held by the Lords Justices that the proof of the notes against the estate of the bankrupt ought to be admitted, such notes having, by recent legislation, been exempted from the operation of 12 Anne, c. 16. "The question," said Lord Justice Knight Bruce, "is one of proof merely, and the single ground on which it was or could have been contended that the bills or notes sought to be proved were not provable was that of usury. But, as this objection was met by the statute 3 & 4 Will. 4. c. 98. s. 7., and the statute 2 & 3 Vict. c. 37., the respondents were under the necessity of maintaining that the securities taken by the petitioner for the payment of the bills or notes (securities wholly or in part upon lands, tenements, or hereditaments, or "some" estate or interest therein,') had the effect of depriving the petitioner of the statutory protection, which, accordingly, has been the point of the controversy. The petitioner, however, claims nothing under any one of these securities. Asserting no mortgage charge or lien, he desires to prove his alleged debt in full as an unsecured debt. Whether the securities, therefore, are or were wholly good, or wholly bad, or partly good and partly bad, is not to be decided. The question is of the validity or invalidity of the bills or notes, as bills or notes merely; and I am of opinion that they are not, and that not one of them is, invalidated or impeached by the se 6 |