100 So. 809 | Ala. | 1924
The cause was submitted on the call of the equity docket for final decree on the bill and decree pro confesso, and a final decree was entered on August 2, 1923. Assignments of error challenge the jurisdiction of the court to render said decree.
The amendment of section 3164 of the Code of 1907, by Acts 1911, p. 565, was further amended by Acts 1915, p. 606. Gilliland Merc. Co. v. Sinclair,
The conveyance by the husband and trustee of trust property to the wife was sought to be annulled for fraud in Davoue v. Fanning, 2 Johns. Ch. (N.Y.) 252, 261. Chancellor Kent there declared that if a trustee sells the trust estate and becomes himself interested in the purchase, the cestuis que trustent are entitled to have the purchase set aside and the property resold by direction of the court. It was declared that it makes no difference in the application of the rule that a sale was at public auction, bona fide, and for a fair price, and that the executor did not purchase himself, but a third person by previous arrangement became the purchaser, to hold in trust for the separate use and benefit of the wife of the executor, who was one of the cestuis que trustent and had an interest in the land under the will of the testator. The chancellor said:
"However innocent the purchaser may be in the given case, it is poisonous in its consequence. The cestui que trust is not bound to prove, nor is the court bound to judge, that the trustee has made a bargain advantageous to himself. *424 The fact may be so, and yet the party not have it in his power, distinctly and clearly, to show it. There may be fraud, as Lord Hardwicke observed, and the party not able to prove it. It is to guard against this uncertainty and hazard of abuse, and to remove the trustee from temptation, that the rule does and will permit the cestui que trust to come, at his own option, and without showing actual injury, and insist upon having the experiment of another sale. This is a remedy which goes deep, and touches the very root of the evil."
In Bassett v. Shoemaker,
"The incapacity of the trustee to become a purchaser at his own sale rests upon the ground of public policy. It is wholly immaterial whether the property brings its full value. Culver v. Culver, 3 Stock. 215; Mulford v. Bowen, 1 Stock. 797.
"The exclusion of the wife as a purchaser, where the husband sells as a trustee, is not so much for the reason that he may subsequently become entitled to some interest in her lands, as on account of the unity which exists between them in the marriage relation. The case falls clearly within the spirit of the principle which excludes the husband himself.
"In Romaine v. Hendrickson, 12 C. E. Gr. 162, affirmed 1 Stew. Eq. 275, Vice Chancellor Van Fleet says:
" 'So jealous is the law of the interest of the cestui que trust that it will not tolerate the slightest antagonism on the part of the trustee. The object of the rule is to prevent the trustee from using his information and power to the prejudice of the cestui que trust.' "
In Chapman v. Hughes,
There was no misjoinder of parties or nonjoinder of necessary parties. It was the primary duty of the corporation to take this action to protect its properties and its creditors, as well as to safeguard the interest of its stockholders. It sought to discharge this duty by prosecuting the instant suit, having for its object the uncovering of the fraud, the cancellation of the conveyance, etc. The cestui que trust is the real party in interest in a court of equity. Town of Carbon Hill v. Marks,
The bill states the facts authorizing relief — that is, states a cause of action — and to which no demurrer was filed. There is a distinction between a bill that is merely insufficient in form and one that does not state a cause of action. The former will support a decree; the latter will not. Code 1907, §§ 2837, 4143; Johnson v. Kelly,
The decree of the circuit court, in equity, is affirmed.
Affirmed.
ANDERSON, C. J., and SOMERVILLE and BOULDIN, JJ., concur.