This section is from the book "Dart's Treatise On The Law And Practice Relating To Vendors And Purchasers Of Real Estate", by J. Henry Dart . Also available from Amazon: A treatise on the law and practice relating to vendors and purchasers of real estate.
No fiduciary relationship between tenants in common; when one receives entire rents.
And, where purchasers stand in the relation of partners, any advantage secured by one (q) by means of any dealings which are within the scope of the partnership business (r)- e.g., the renewal of a lease (s), or an abatement of incumbrances charged on the property (t), or a secret bonus from the vendor for effecting the sale (u) - enures to the benefit of the others (x).
Any advantage secured by purchasing partner, enures to benefit of co-partners.
(l) Kennedy v. De Trafford, 1897, A. C. 180; 66 L. J. Ch. 413.
(n) lb.; Henderson v. Eason, (1851) 17 Q. B. 701; 21 L. J. Q. B. 82; and see M'Mahon v. Burchell, (1846) 2 Ph. 127 ; Bewley v. Hancock, (1855) 6D. M. &G.391.
(o) Clegg v. C, (1862) 8 Jur. N. S. 92.
(p) Doe v. King, (1851) 6 Ex. 791; 20 L. J. Ex. 301.
(q) Somerville v. Mackay, (1810) 16 Ves. 382. .
(r) Dean v. MacDowell, (1878) 8
Ch. D. 345, 351 ; 47 L. J. Ch. 537 ; Aas v. Benham, 1891, 2 Ch. 244 ; 65 L. T. 25.
(s) Featherstonhaugh v. Fenwick, (1811) 17 Ves. 298 ; Clegg v. Fishwick, (1849) 1 M. & G. 294 ; 19 L. J. Ch. 49.
(t) Carter v. Home, (1728) 1 Eq. Ca. Abr. 7, which, according to the report, was a mere case of a joint-purchase ; and see 1 M. & G. 300.
(u) Beck v. Kantorowicz, (1857) 3 K. & J. 230.
(x) See Partnership Act, 1890, s. 29.
If the land is bought as a speculation - e.g., under an agreement between the partners that it shall be laid out, allotted, and sold for building purposes - no partner can enforce a partition or sale in contravention of the terms of such agreement (y). If, however, the management of the concern is entrusted to certain partners, who refuse to execute the duty they have undertaken, the Court will, upon a suit being instituted by another partner, take on itself, so far as it can, to put him in the situation in which he would have been had the trusts been properly performed (2).
On joint purchase by way of speculation, partner must conform to agreement.
By s. 22 of the Partnership Act, 1890, land or any heritable interest therein which has become partnership property is to be treated, in the absence of a contrary intention appearing, as converted into personalty. This section embodies the rule formerly existing in Equity, and which was held to prevail in the case of land bought as a joint speculation for the purpose of selling it again in smaller parcels (a).
Partnership Act, 1890, s. 22 ; land bought for partnership purposes, or by way of joint speculation, is personal estate.
Where land, with a quarry on it, was vested in co-owners, who worked the quarry and let the remainder of the land for agricultural purposes, and the yearly rents and profits, though generally divided amongst them, were occasionally invested in the purchase of other lands which were conveyed to the managing owner, and partly used in connection with the quarry, it was held that the share in the purchased lands of one of the co-owners who died intestate, descended on his heir, though in the books of account the purchases were treated as if they had been purchases of stock in trade, on the ground that, in spite of appearances to the contrary, the land had always been treated as real estate held in co-ownership, and that no one of the so-called partners could have insisted on a sale (b). Whether the land is or is not converted is in every case a question of intention to be gathered from the surrounding circumstances (c).
(y) Peck v. Cardwell, (1839) 2 Beav. 137 ; see Dale v. Hamilton, (1817) 2 Ph. 266 ; 16 L. J. Ch. 397.
(a) See (1847) 2 Ph. 276.
(a) Darby v. D., (1856) 3 Dr. 495 ;
25 L. J. Ch. 371; Essex v. P., (1855) 20 Beav. 442, 450; Waterer v. W., (1873) 15 Eq. 402; Re Hulton, (1890) 62 L. T. 200; ef. Re Wilson, 1893, 2 Ch. 340; 62 L. J. Ch. 781 ; and see Lindley, 6th ed. 352 el seq.
It appears that the land of a surviving partner does not remain personal estate, as between his real and personal representatives, after the determination of the partnership by-death, for the discontinuing the business has been held to create a reconversion (d).
Land of surviving partner -when reconverted into realty.
Where, upon an agreement for a joint-purchase, the conveyance is taken in the names of some, but not all, of the intended purchasers, the interests of the others may be established by any subsequent writing, signed by the fiduciary partners, and which acknowledges or proves the existence of the trust (e) ; and this, though the agreement is that one purchaser shall find the money, and the other contribute his skill in purchasing and subsequently allotting and selling the land (/). Lord St. Leonards, however, considered (g) that the mere fact of one of two parties in treaty for an estate desisting therefrom under a parol agreement that the other shall complete for their joint benefit, is not such a part performance as takes the case out of the Statute of Frauds; and that, in the absence of any subsequent written admission of the trust, the aggrieved party, unless he can establish a resulting trust, by proof of his having paid or contributed to the purchase-money, has no remedy. "Where there is an actual declaration of trust, of course it is not necessary that the party seeking to enforce it should himself have been a party to it (h). But if a nominal purchaser assumes to act as sole owner, the other party must be prompt in coming to the Court (i).
If conveyance be not taken in names of all the purchasers, trust may be proved by any subsequent writing signed by nominal purchasers.
(b) Steward v. Blakeway, (1869) 4 Ch. 603 ; and see Randall v. R., (1835) 7 Si. 271.
(c) Smith v. S. (1800) 5 Ves. 193 ; Re Hulton, (1890) 62 L. T. 200; Re Wilson, 1893, 2 Ch. 340 ; 62 L. J. Ch. 781 ; Davis v. D., 1894, 1 Ch. 393; 63 L. J. Ch. 219.
(d) Myers v. M., (1889) 34 Sol. J. 47; 61 L. T. 757.
(e) Forster v. Hale, (1798) 3 Ves. 696 ; S.C., (1800) 5 Ves. 308; Randall v. Morgan, (1806) 12 Ves. at p. 74 ; and ef. Barkworth v. Young, (1856) 4 Dr. 1; 26 L. J. Ch. 153 ; Lindley on Partnership, 6th ed. 333.
(f) Bale v. Hamilton, (1847) 2 Ph. 266 ; 16 L. J. Ch. 397 ; but see and consider Caddick v. Skidmore, (1857)
2 De G. & J. 52 ; 27 L. J. Ch. 153 ; a case of alleged partnership in a mine ; Smith v. Matthews, (1861) 3 D. F. & J. 139, 151; 30 L. J. Ch. 445; Gray v. Smith, (1889) 43 Ch. D. p. 211 ; Be Be Nichols, 1900, 2 Ch. 410 ; 82 L. T. 410, judgment of Kekewich, J., referring to cases cited above ; and see Liudley on Partnership, 6th ed. 89 et seq.
(g) Sug. 14th ed. 700; Atkins v. Rowe, (1728) Mos. 39 ; Lamas v. Bayley, (1708) 2 Vern. 627 ; see Donohoe v. Conrahy, (1845) 2 J. & L. 688, 695; Caddick v. Skidmore, sup. But may not such a case be treated as one merely of fraud on the part of an agent ? see sup. p. 210 ; Cowell v. Watts, (1850) 2 H. & Tw. at p. 230.
Where land is held in trust, the declaration must, under the Statute of Frauds, "be manifested and proved by some writing, signed by the party who is by law enabled to declare such trust" (k) ; by which is meant the beneficial owner (/), not the trustee having the legal estate ; and the declaration may be sufficient, though the trusts are not to take effect until after the settlor's death, and the declaration itself cannot operate as a testamentary instrument. Lord Cran-worth is reported to have said that a mere declaration of trust in favour of a volunteer is inoperative (m) ; but, in a later case, he repudiated this dictum as a general statement of the law (n).
Declaration of trust should be signed by beneficial owner.