Saltmarsh v. Beene

4 Port. 283
Supreme Court of Alabama·Decided January 15, 1837·Published·Cited by 17 cases

Opinion

COLLIER, J.

— This cause comes up by appeal from the Equity .side of the Circuit Court cf Dallas County.

From the record we learn that the plaintiff here,together with two other individuals, were appointed commissioners, by the judge of tho County Court of that County, to sell at public auction the real estate of Thomas Ewing, deceased. That both the plaintiff and defendant being desirous to purchase, the one the west and the other the east half of a quarter section of land, belonging to the estate, on the day of, and imm'ediately preceding the sale they agreed in writing to purchase the quarter section, and divide it by assigning each to the other, the part respectively stipulated for in their agreement. At the commissioners’ sale,"Beene became the purchaser, complied with the terms of sale, and received a deed, executed by all the commissioners. After-wards, being called upon to execute his contract, by making a deed for the west half, to the plaintiff, he refused to do so, but with a reservation of a right of way through the same. The plaintiff declining to yield to this requisition, the defendant brought an ac-' tion at law, to eject him from the possession, which he had before acquired. And (hereupon the plaintiff filed his bill to enjoin a trial at law, and to compel the defendant to perform his contract by executing a deed.

The argument of this cause has taken a wide [291] range, and many questions have been discussed, the consideration of which is rendered unnecessary by the view we .shall take of it. The first question which naturally presents itself, is this — has the plaintiff acquired a right, by his contract with'the defendant, which a Court of equity will regard and protect 1 This must depend upon his right to purchase at the commissioners’ sale. By the civil law, the same person cannot be both buyer and seller; because, if he were permitted to be the purchaser, his duty and his interest would stand in direct opposition : for, as the representative of the owner, it would be his duty to bargain for the highest price, while, as purchaser, it would he his interest to give the lowest.” For these reasons, and to guard against frauds, which, in many instances would be beyond human detection, that law inhibited purchases by persons thus circumstanced.

This rule of the civil law is practised upon in our Courts of Equity, and applied to trustees, agents, and generally to all persons who have been employed in a confidential character in relation to property. Whichcote vs Lawrence;* Campbell vs Walker ; Lister vs Lister, Green vs Winter;§ Crow vs Ballard;|| Lord Hardwick vs Vernon; Ex parte Reynolds;** Ex parte Lacey;†† Owen vs Foulkes;‡‡ Ex parte James;§§ Pankist vs Alexander.||||

And it is immaterial, whether the sale be made privately or at public auction, the reason of the rule is as strong in the one case as the other; though the chances for detection would be more favorable in the latter, than the former, if any unfairness were [292] practiced by the purchaser. See the case of the York Buildings Company vs M’Kenzic* ° M ^

Nor does it make any difference though there be a plurality of trustees. — -A sale by one trustee to his co-trustee, is illegal. — Ringold et al. vs Ringold et al. Each owes to his situation the same duty that ail do., and is, therefore not permitted to do any acs which may tempt him from its honest performance, or give him an interest adverse to his constituent.

It is a well established rule of law, that a man can not do, indirectly, ¡hot which it is unlawful to do, directly. If, then, the plaintiff could not have purchased at the commissioners’ sale, (of which we have no doubt,) it was certainly incompetent for him to have purchased through the agency of the defendant. Such a purchase is obnoxious to every objection that could be urged against a purchase by the plaintiff, directly, with a force increased, by the increased difficulty of detecting any unfairness in the sale. While a trustee is restrained from purchasing at a sale made by himself, in that character, either personally, or through the intervention of an agent, he can not, at. such sale, become the agent of a purchaser. Ex ' parte n ,. c* Bennett.§

The doctrine as to purchases by agents or persons exercising a confidential character, is founded rather upon general principles, than upon a state of facts as applicable to any particular case. In ex parte James,|| it was decided that the purchase was not permitted in any case, however honest the circumstances; the general interests of justice requiring it to be destroyed in every instance — no Court being equal to the investigation and ascertainment of [293] the truth in mwh the greater number of cases .HkLord Rosslyn was of an opinion, that to authorise'the sale to be set aside, it should be shewn that the agent or trustee had gained an advantage by the purchase-# Whichcote vs. Lawrence.*' But the correctness o,f Lord Rosslyn’s opinion is denied by Lord Eldon, in the cases of ex parte James and ex parte Bennett, already cited. And the true rule now recognised in the Courts of Chancery, both in England and this country, is that laid down in Lord Ahanley, in Campbell vs Walker, that a trustee purchasing the trust property, is liable to have the purchase set aside, if in any reasonable time thereafter, the cestui que trust makes known his dissatisfaction.

If the general interests of justice inhibit the purchase of the trust property by the trustee, eitber by himself or an agent, it follows necessarily that he cannot purchase jointly with another. The plaintiff, by whatever name he may be technically designated, must be regarded in equity, as a trustee, subject to all the 'rules of law that, are applicable to purchases made by individuals standing in that character. And a purchase made by the defendant for the joint benefit of himself and the plaintiff, may be considered as if made by the plaintiff himself, if it were necessary. If a trustee purchases the trust property, and receives the proper evidences of title, his title will prevail against all strangers, and he may re-claim the property if dispossessed, or may maintain an action for any injury it sustains. But he cannot enforce a contract entered into, in contemplation of a purchase which is subsequently made. The policy of the law forbids the [294] trustee from speculating upon the confidence reposed in him; and by removing temptation makes him incapable of doing so ; and equity can never enforce a contract, denounced by the policy of the law, the more especially when the public interest does not demand relief.

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