This section is from the book "A Compendium Of The Law And Practice Of Vendors And Purchasers Of Real Estate", by J. Henry Dart. Also available from Amazon: A compendium of the law and practice of vendors and purchasers of real estate.
The remarks which we have already made (k), as to undue personal influence, seem to be as applicable to purchasers as to vendors.
It is also a general rule in equity, that no person "who by being employed or concerned in the affairs of another has acquired a knowledge of his property" (I), or who, in respect of the property to be sold, has a duty to perform which is inconsistent with the duty or interest of a purchaser (m), shall himself purchase such property; nor shall he purchase for himself in another's name; nor shall he himself purchase as agent for another (n); nor, perhaps, even employ a third person to buy as agent for another (o); the rule, however, is subject to particular qualifications hereinafter mentioned.
Nor is such a purchase rendered valid by the fact of the sale having been by auction, or before the Master under a Decree of the Court (p); nor, in the case of a person who by filling a confidential situation has acquired a knowledge of the property, is his capacity to purchase restored by his previous retirement from such situation (q); for his knowledge remains.
The rule has been held to apply to the several cases of
An agent for sale (r):
An agent for the management of property; who can only purchase subject to the onus of proving that he afforded his principal all the knowledge respecting its value which he derived as agent (s):
As to who are relatively incompetent to purchase.
Persons filing a fiduciary-character.
Purchase by, invalid, although by auction, or before the Master.
Rule affects purchases by
Agents:
(k) Page 7.
(l) Sug. 887; Ahearne v. Hogan, 1 Dru. 310.
(m) Greenlaw v. King, 3 Beav. 49.
(n) 9 Ves. 248.
(o) Sug. 890.
(p) Sug. 891.
(q) Carter v. Palmer, 8 Cl. & Fin. 657.
(r) York Buildings Company v. Mackenzie, 8 Bro. P. C. 42; Wood-house v. Meredith, 1 Jac. & W. 204; Barker v. Harrison, 2 Coll. 546; Charter v. Trevelyan, 11 Cl. & Fin. 714; In re Bloyes' Trust, 1 Mac. & G. 488; et vide infra, as to Solicitors and Agents.
An arbitrator, contracting for unascertained claims of parties to the reference (t):
An assignee of a bankrupt; against whom the rule is more than ordinarily stringent (u); and it extends to a purchase by his partner on behalf of the firm (v); the Court has, however, on the petition of a purchasing assignee, directed a reference to the Commissioners to inquire whether the purchase would be for the benefit of the estate, he paying all the costs (w); and, on the report being favourable, has confirmed the sale (x): it has also, under special circumstances, allowed an assignee to be removed, at his own request, in order that he might bid at the sale of the bankrupt's estate (y): where, however, an assignee, who was also second mortgagee of the property, applied for leave to bid, (remaining assignee,) the Court refused the application; but allowed him to name a price at which he might take the property if not sold at the auction (z):
An auctioneer employed to sell the property (a):
A Bishop purchasing an annuity to be charged upon a rectory; he being the person whose consent was required to the sale; although giving a better price than could have been elsewhere obtained (b):
Arbitrators:
Assignees:
Auctioneers:
Bishop whose consent was required to sale.
(s) Cane v. Lord Allen, 2 Dow. 289; Molony v. Kernan, 2 Dm. & W. 31; and see Rossiter v. Walsh, 4 Dru. & W. 485; Murphy v. O'Shea, 2 Jo. & L. 422.
(t) Blennerhassett v. Day, 2 Ball & B. 116.
(u) Ex parte Lacey, 6 Ves. 630; Ex parte Bennett, 10 Ves. 395; Ex parte Alexander, 2 Mon. & Ay. 492;
Turner v. Trelawny, 12 Sim. 49.
(v) Ex parte Burnett, 7 Jur. 116.
(w) Ex parte Gore, 6 Jur. 1118; 3 Mon. D. & De G. 77.
(x) S. C, 7 Jur. 136.
(y) Ex parte Perkes, 3 Mon. D. & De G. 385.
(z) Ex parte Holyman, 8 Jur. 156.
(a) Sug. 887.
(h) Greenlaw v. King, 3 Beav. 49.
A Commissioner of bankrupts (c), although he had ceased to act in the prosecution of the fiat (d):
Commissioners for Inclosure under the general Inclo-sure Act; who cannot purchase any land in a parish in which an Inclosure is made, until five years from the date and execution of their award (e): and a similar disability for the term of seven years affects valuers acting under the Commons Inclosure Act (f):
The Committee of a lunatic's estate; the Court has even refused to confirm a lease to the Committee though approved by the Master as advantageous to the estate (g):
Counsel, who purchased, below their nominal value, charges upon his late client's estate (h), upon the validity of which he had advised:
A creditor of a bankrupt, who had been consulted by the assignees as to the best mode of selling the estate (i):
Executors and administrators, in respect of the personal estate of the deceased (j):
A guardian, purchasing from his ward, immediately on his coming of age; although the price was adequate (k):
A governor of a charity, taking a lease of the charity lands (l):
A mortgagee with a power of sale; who cannot purchase, under the power, either in his own name or through an agent: nor can his agent, who has acted in surveying the property and receiving the interest, purchase on his own account from the mortgagee (m); but the rule does not apply to a purchase of the equity of redemption by the mortgagee from the mortgagor (n); it is, however, usual, although perhaps not strictly necessary, upon a sale under the general order in Bankruptcy, for a mortgagee intending to bid, to apply for leave so to do (o); in the case of a legal mortgage, it appears to have been a common, although improper, practice, for the mortgagee to conduct the sale (p); in such a case, of course, he could not purchase without the permission of the Court:
Commissioners is Bankruptcy.
Commissioners for Inclosure; and Valuers.
 
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