15 Utah 280 | Utah | 1897
alter making a statement of the pleadings and facts as above, delivered the opinion of the court:
It is contended for the respondent at the outset that the statement on motion for a new trial is not properly a part of the record on which the appeal was taken, because, as is insisted, notice of intention to move for a new trial was not served in time, as required by section 3402, Comp. Laws Utah 1888, and was defective. The statute requires the moving party to serve such notice within 10 days after notice of the decision of the court when the cause is tried without a jury. The question, therefore, is, when ought the notice to have been served? The first decision of the cause was announced on the 22d of August, 1891, and it was in favor of the plaintiffs. In line with that decision, which, in effect and in reality, was merely an interlocutory decree, the same
It is further insisted on behalf of the respondent that the plaintiffs were guilty of such laches in the prosecution of- their suit as to justify the court in dismissing the complaint. No doubt it is the duty of every person who institutes legal proceedings against another to prosecute his suit with reasonable diligence, and he may forfeit his rights by a failure to so prosecute it. Bouvier defines laches as “negligence”; Anderson, as “neglect, negligence, default; inexcusable delay in asserting a right.” It is such negligence as results in the omission to do what one is by law required to do to save a right, and which warrants a presumption that the claimant of it has abandoned it and declines to assert it. When the assertion of a right is neglected or omitted for a period of time more or less great, and under such circumstances as to cause prejudice to an adverse party, it may operate as a bar in equity. Although an important ingredient in the law of laches, the instances seem to be rare where courts have declared that mere lapse of time might effect a positive bar, even in cases of purely equitable
Viewing the case at bar, as disclosed by the record, in the light of these principles, were the plaintiffs guilty of such negligence in the prosecution of the action as to preclude their recovery on the ground of laches? Without stating the facts and examining the history of the case in detail, it is clear that this question must be answered in the negative. It is true the cause was tried, and the interlocutory decree entered, in 1891, and the findings were not filed until 1894; but what is there to show that the plaintiffs caused the delay? There is no proof of facts or circumstances which impute negligence to them in this regard, and we cannot presume negligence where no facts appear which warrant us in so doing. In fact, the presumption growing out of the principles of human nature as developed in experience is that men will use reasonable diligence to obtain their rights. Observation teaches us that persons are more likely, in their haste, to assert a groundless, and consequently false, claim, than to retard proceedings to enforce a just and lawful one. Considering the crowded condition of the docket during the proceedings of this case in the territorial district court, the record of which we may take judicial notice, it could hardly do violence to any principle of justness and fairness to presume, in the absence of proof to the contrary, that the delay was
The most important question in the case is whether the defendant, Dooly, having become the purchaser at the foreclosure sale of two-thirds of the Dickens mining property, purchased and had the right to hold it discharged of any trust. It is admitted that Norton conveyed the property to him in trust to convert the same into money, pay the debts of the grantor, a reasonable compensation to the trustee, and the balance to his •devisees, and that, after Norton’s death, Dooly became
The disqualification embraces also all such persons as are employed and concerned in the affairs of another, and who, because of position, possess means of information which might be used in a manner hostile to the interests which it is their duty to promote. Where a trustee, however, purchases trust property at a sale, the purchase is not absolutely void, but voidable merely, at the option of those who are beneficially interested, and he takes the property subject to the equities of the cestuis que trust, who, within a reasonable time, may call upon him to account for the proceeds or profits, or have a resale, or may avoid the sale. Fisk v. Sarber, 6 Watts & S. 18; Whichcote v. Lawrence, 3 Ves. 740. If it were
The case of Bennett v. Austin, 81 N. Y. 308, was an action to have a quitclaim deed declared to be a mortgage, and for an accounting and redemption. From the facts it appears that as security for advances made to the firm of Bennett & Avery the members thereof executed to Stephen G-. Austin a quitclaim deed to their interests in certain premises, upon which were two elevators. Previously, the firm and other owners of elevators had entered into an agreement with the Western Elevating-Company, and nominally leased to it their elevators; they, however, to retain possession and operate them, and the profits to be divided among the owners. The firm had also assigned their share in the profits to the holders of a prior mortgage, to be applied in liquidation of the debt secured by the mortgage and other prior incumbrances. Austin, although aware of this arrangement, afterwards, by setting up his apparent title, without the consent of the firm or of the mortgagees, induced the company to cancel the former agreement, and substitute a new one with him as the owner of the elevators, and thereafter received and retained the dividends. Thereupon the mortgagees, making Austin a defendant, foreclosed, and by an arrangement with them Austin, at the sale, pur
The transaction, in legal effect, is the same, and the ■general rule applies, whether the purchase is made by the trustee himself, for his benefit, or through the intervention of a third party, as trustee or agent for him, or whether he makes the purchase as agent for some other person, because one who is incapacitated to purchase for himself cannot buy as agent for another. Ex parte Bennett, supra; Hawley v. Cramer, 4 Cow. 717.
Having thus considered the principles which apply to trustees, or those holding fiduciary relations to others, it now becomes important to determine whether, under the facts and circumstances disclosed by the record, the case at bar falls within the prohibition of the general rule, or whether defendant, Dooly, had shaken off his relation as trustee, and made the purchase discharged from the trust. In the firsft instance he took upon himself the duties of a trustee by accepting the deed from Norton. These duties required him to sell the property to the best possible advantage, and out of the proceeds to pay Norton’s creditors, including the defendant as mortgagee, and, after paying the expenses, and paying the trustee a reasonable compensation for services, turn the balance over to the devisees. After conferring this trust, Norton died, and then Dooly became executor of the estate. He immediately assumed control of the property, and was placed in a position to obtain, through his
Further reference to the evidence would not be profitable, because it is evident that the defendant made the purchase in his character as trustee, for the benefit of the cestuis que trust, and must be held to account for the profits made by the subsequent sale. It is true that he was a mortgagee, and was not instrumental, in the first instance, in bringing about the foreclosure sale; but this gave him no such interest in the property as to alter his position as trustee or permit him, without the consent of the cestuis que trust, to assume an attitude whereby his own interests might be opposed to the interests of those for whom he had undertaken to act. Equity wall not open the door to any such clashing of interests. A mortgagee who is also a trustee is bound to fulfill his trust with the same fidelity as if he were not a creditor. Nor could the defendant act as trustee up to the time of the sale, then disrobe himself of his fiduciary character,' and, with the information obtained while in the trust relation, gain an advantage to himself. Nor could the court of Idaho confer upon him any power to so gain such advantage by dismissing the suits against him as executor. As mortgagee his rights were in no way impaired by the sale. His situation was just the same after as before. He still had the right to payment out of the property, but he had no right to speculate with the trust fund, and therefore it was his duty to account to the cestuis que trust for the profits of the sale to the syndi
Counsel for the respondent also rely on the provision in the decree of foreclosure which authorizes any party to bid at the sale. A provision of this character is common in such decrees, but it was never intended for the purpose of permitting a trustee, who is a party to the suit, to bid in the trust property for his own benefit. It is usually inserted to avoid the -supposed technical rule that a party to a suit cannot become a purchaser, under the decree therein, without special permission. In Fulton v. Whitney, 66 N. Y. 548, Mr. Justice Rapallo said: “ Such a provision, in foreclosure cases, is usually inserted for the purpose of removing any doubt as to the right of the complainant who conducts the suit and the sale to become the purchaser: If the purchaser, though a party to the action, is acting in a fiduciary capacity arising outside of the relation of mortgagor and mortgagee, his liability to his cestuis que trust cannot be affected by such a provision, nor by the order confirming the sale.” Bennett v. Austin, supra; Torrey v. Bank, 9 Paige 649.
Doubtless a trustee may, when the circumstances of the ease warrant it, make special application to a court of equity, stating why it would promote the interests of
Counsel for the appellants insist that the defendant was guilty of actual fraud. However this may be, it is unimportant to consider this question, because it is not a necessary ground for relief. However innocent and fair the purchase, it was vicious in its consequences, and the eestuis que trust were neither bound to allege nor prove, nor was the court bound to determine, that the trustee was guilty of fraud, or made a bargain advantageous to himself. For the purposes of this suit it may be assumed that the purchase was not tainted with fraud, and still the plaintiffs are not bound by it. Fraud may exist, and yet not be susceptible of proof. To guard against this hazard and the violation of duty, and to remove the trustee from temptation, equity imposes upon him the disqualification of becoming a purchaser of the trust property for himself, without the consent of his eestuis que trust, and thus the rule destroys the very root of the evil. Whelpdale v. Cookson, 1 Ves. Sr. 9; Case v. Carrol, 35 N. Y. 385; Davoue v. Fanning, supra; Fulton v. Whitney, supra.
It is not deemed necessary to make a special analysis of the cases cited by counsel for the respondent, because a careful examination of them satisfies us that they cannot be regarded as controlling authority in the case at bar. In none of them do the essential and decisive facts, appear to be the same as, or even similar to, those herein.