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.
Purchase not rendered valid by being by auction, etc.
(r) See Oldin v. Samborne, (1737) 2 Atk. 15; Mulhallen v. Marum,, (1843) 3 D. & War. 317; Archer v. Hudson, (1844) 7 Beav. 551; 13 L. J. Ch. 380; Powell v. P., 1900, 1 Ch. 243; Re Coomber, 1911, 1 Ch. p. 727.
(s) Cane v. Lord Allen, (1814) 2 Dow. 289; Molony v. Kernan, (1842) 2 D. & War. 31; Chambers v. Betty, (1815) Beat. 488; and see Rossiter v. Walsh, (1843) 4 D. & War. 485; Murphy v. O'shea, (1845) 2 J. & L. 422.
(t) Eyre v. Mcdonnell, (1864) 15 Ir. Ch. R. 534; Alven v. Bond, (1841) Fl. & K. 196.
(u) Lord Selsey v. Rhoades, (1824) 2 S. & S. at p. 49; (1827) 1 Bli. N. S. 1.
(x) Carter v. Palmer, (1842) 8 Cl. & F. 657.
(y) Ex p. Hughes, (1802) 6 Ves. 617.
(z) Sug. 14th ed. 691; Ex p. James, (1803) 8 Ves. at p. 348; Randall v. Errington, (1805) 10 Ves. 423; Ingle v. Richards, (1860) 28 Beav. 361.
(a) Price v. Byrn, cited 5 Ves. 681; and see Cary v. C, (1804) 2 Sch. k L. 173.
(b) Campbell v. Walker, (1800) 5 Ves. 678; and see Tennant v. Trenchard, (1869) 4 Ch. at p. 547.
On the other hand: An execution creditor may buy the property sold under the execution (d).
Execution creditor may buy.
A solicitor generally is under no positive disability to purchase from his client (e); provided that he does not conceal material facts, but makes full disclosure (f). Yet where the confidential relation subsists, and the transaction is impeached, he must prove its fairness; and that either the circumstances were such as not to impose upon him the duty of advising the client, or that he gave the client all the information respecting the subject of the purchase which he himself possessed, and advised him as diligently as he would or ought to have done, had the transaction been between the client and a stranger (g); and that the sale was as advantageous to the client as it would have been if the solicitor had used his utmost endeavours to sell the property to a stranger (h); but he need not have pointed out a merely speculative advantage (such as the possibility of an unplanned, though contemplated, railroad running near the property), which might be reasonably supposed to be equally in the knowledge of both parties (i); nor does the fact of the consideration having in part consisted of costs already incurred (k), or of a judgment vested in the solicitor (l), necessarily invalidate the transaction; though the mere fact of the client being indebted to the solicitor is an unfavourable feature, on account of the additional influence it must necessarily have created.
As to purchases by solicitors.
(c) Ex p. James, (1803) 8 Ves. at p. 352; Carter v. Palmer, (1842)
8 Cl. 4; F. 667; Spring v. Pride, (1864) 4 De G. J. & S. 395; 12 W. R. 892; but see as to agents, Scott v. Dunbar, (1828) 1 Moll. 442.
(d) Stratford v. Twynam, (1822) Jac. 418; Ex p. Villars, (1874)
9 Ch. 432; 43 L. J. Bky. 76.
(e) Johnson v. Fesemeyer, (1858) 3 D. & J. 13, 22, where the solicitor was an urgent creditor. See Gibson v. J eyes, (1801) 6 Ves. 266; Cane v. Lord Allen, (1814) 2 Dow. 289, 299; Pisani v. A.-g. of Gibraltar, (1874) L. R. 5 P. C. 516; Davies v. London and Provincial Insurance Co., (1878) 8 Ch. D. 469; 47 L. J. Ch. 511.
(f) Davies v. London and Provincial Insurance Co., sup.
(g) See Holman v. Loynes, (1854) 4 D. M. & G. 270; 23 L. J. Ch. 529; Barnard v. Hunter, (1856) 5 W. R. 92; and Barron v. Willi*, 1900, 2 Ch. 121; 69 L. J. Ch. 532.
(h) Spencer v. Topham, (1856) 22 Beav. 573; Denton v. Donner, (1856) 23 Beav. 285; and see Wright v. Carter, 1903, 1 Ch. 27.
In Wright v. Carter, Stirling, L. J., in his judgment said - " It" (a deed under which a solicitor claimed), "has been treated in argument as a transaction of sale, and I am prepared so to regard it. . . . Here, again, an onus, but of a different kind, is cast upon Mr. Carter. The rules of the Court require this to be proved in a transaction of sale in which the solicitor is a purchaser - first, the client must be fully informed; secondly, he must have competent independent advice; and thirdly, the price given must be a fair one. The onus of proving all this lies on the solicitor" (m). Where a solicitor and mortgagee took a conveyance of the equity of redemption from the mortgagor, a day labourer, who had no independent advice, the deed was set aside many years afterwards, the burden of showing that all the circumstances had been explained to the mortgagor not having been discharged (n). But provided that there is no concealment (o), the rule does not extend to prevent a purchase, by a solicitor, of his client's property in respect of which he has not been professionally employed (p); or to prevent his purchasing by auction his client's property if he has not acted for him professionally in respect to the sale (q). But when a solicitor has once advised upon an intended sale of his client's property, there is a difficulty in holding that any mere lapse of time can get rid of the fiduciary relation (r). The mere employment of another solicitor to peruse the draft conveyance on behalf of the client, will not be sufficient proof of the fairness of the transaction (s); and where a purchase by a solicitor from his late client is defended on the ground that the client had other professional assistance, it must be shown that the solicitor, who intervened, was fully informed as to the state of the vendor's affairs, and the value of the property (t).
(i) See Edwards v. Meyrick, (1842) 2 Ha. 60; 12 L. J. Ch. 49; and Holman v. Loynes, (1864) 4 D. M. & G. 270; 23 L. J. Ch. 529; Ward v. Hartpole, (1776) 3 Bli. 470; Bellamy v. Sabine, (1835) 2 Ph. 425; 17 L. J. Ch. 105; Salmon v. Cutts, (1850) 4 De G. & S. 125; 21 L. J. Ch. 750; aff. 16 Jur. 623; King v. Savery, (1853) 1 S. & G. 271; Savery v. King, (1856) 5 H. L. C. 627; 25 L. J. Ch. 482; Cookson v. Lee, (1854) 23 L. J. Ch. 473.
(k) Edwards v. Meyrick, sup.; aliter as regards future costs: Upping-ton v. Bullen, (1842) 2 D. & War. 184.