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.
(i) See Ex p. James, (1803) 8 Ves. at p. 353; Benton v. Donner, (1856) 23 Beav. 285; Hickley v. E., (1876) 2 Ch. D. 190; 45 L. J. Ch. 401; Plowright v. Lambert, sup.; Dougan v. Macpherson, 1902, A. C. 197; 71 L. J. P. C. 62.
(k) Williams v. Scott, 1900, A. C. 499; 69 L. J. P. C. 77; and see the notes to Fox v. Mackreth, 2 Wh. & T. L. C. 9th ed. pp. 684 - 687.
(l) See Coles v. Trecothick, (1804) 9 Ves. 234; and cf. Ingle v. Richards, (1860) 28 Beav. 361.
(m) Lownes v. Grazebrook, (1817) 3 Mer. at p. 209.
(n) Ex p. James, (1803) 8 Ves. 352; and see Carter v. Palmer, (1841) 8 C. & F. 657. Cf. Allison v. Clayhills, (1907) 97 L. T. 709.
(o) Lord Hardwicke v. Vernon, (1798) 4 Ve9. 411; Lewis v. Hillman, (1852) 3 H. L. C. 607, 630; Ingle v. Richards, (1860) 28 Beav. 361;
Where the beneficiaries or any of them are not of full age, a purchase by a trustee, who comes within the restrictive rule, can be safely effected only under an order of the Court; which order will not be made unless to the evident advantage of the trust (p). A purchase by a trustee, made without this precaution, cannot be supported even by evidence of the best possible terms having been secured for the beneficiaries (q).
Purchase under decree when beneficiaries are not of full age.
The trustee or other person purchasing while under any incapacity of the second description may, on the requisition of any of his beneficiaries - including all persons interested in the estate before the sale (r) and their representatives - be compelled to (1), reconvey the estate, if he has not resold it (s): (2), let it be put up for sale, and reconvey to another purchaser, if a better can be found; but if not, to keep it (t): or (3), if he has resold it at a profit, to account for such profit (u).
Risk incurred by disqualified purchaser.
He may be forced to reconvey; or let estate be resold; or to account for profit if he has sold.
And a sub-purchaser or mortgagee, buying or lending with notice of the circumstances creating the incapacity in the original purchaser, is in the same predicament, if the original sale be impeached (x); though it has been suggested that, if the case be merely that of an avowed purchase by a trustee from his beneficiaries, a sub-purchaser or mortgagee would not be liable unless he had notice of circumstances rendering it voidable (y). In many doubtful cases, his security would practically depend upon his having the legal estate.
Sub-purchaser with notice is similarly liable.
Dunne v. English, (1874) 18 Eq. 524; Mcpherson v. Watt, (1877) 3 A. C. 254.
(p) See Campbell v. Walker, (1800) 5 Ves. 681; Farmer v. Dean, (1863) 32 Beav. 327.
(q) Aberdeen R. Co. v. Blaikie, (1854) 1 Macq. at p. 472; Fox v. Mackreth, 2 Wh. & T. L. C. 9th ed. p. 683.
(r) Ex p. Morgan, (1806) 12 Ves. 6.
(s) Ex p. Lacey, (1802) 6 Ves. 627; and see Hamilton v. Wright, (1842) 9 C. & F. 111.
(t) Ex p. Reynolds, (1800) 5 Ves. 707; Lister v. L., (1802) 6 Ves. 631; Ex p. Hughes, (1802) 6 Ves. 617; Randall v. Errington, (1805) 10 Ves. 423.
(u) Fox v. Mackreth, 2 Wh. & T. L. C. 9th ed. p. 668 and notes thereto. Where an agent for purchase has sold his own property to his principal, the latter's only remedy is probably rescission: Re Cape Breton Co., (1885) 29 Ch. D. 795; 54 L. J. Oh. 217, 822; Ladywell Mining Co. v. Brookes, (1887) 35 Ch. D. 400; 56 L. J. Ch. 25, 684; Re\lady Forrest Gold Mine, 1901, 1 Ch. 582; 70 L. J. Ch. 275; Burland v. Earle, '1902, A. C. 83; 71 L. J. P. C. 1. For forms of the orders made where a transaction is set aside for fraud or concealment or by reason of a fiduciary relation, see Seton, 7th ed. pp. 2250 - 2255.
Where a sale is set aside, the purchaser, in ordinary cases, will be credited with his original purchase-money and interest at 4l. per cent., and all sums expended by him in substantial improvements (unless ,he have been guilty of actual fraud) (z), e.g., upon buildings erected and inclosures made (a), or in repairs (b), and interest from the time of the advances; and will be debited with rents received by him, an occupation rent for any part occupied by himself (c), his receipts for the sale of timber, etc, and also with the estimated amount of deteriorations (if any) (d); but he will not be charged with interest on rents and profits (e).
Terms upon which reconveyance is decreed:
In making the above estimates, buildings pulled down will, if incapable of repair, be valued as old materials, but otherwise as buildings standing (f).
Where the decree directs a reconveyance, and an account, and payment of the balance to the purchaser, but does not in terms give him a lien for such balance upon the estate, the reconveyance must be made at once, without waiting for the accounts (g). A solicitor purchasing from his clients, who were trustees for sale, has been compelled to produce the title deeds before payment, though he alleged that the early title was defective, and on that ground resisted production (h).
Must recon-vey at once unless decree gives him a lien for balance due.
(x) Cookson v. Lee, (1853) 23 L. J. Ch. 473.
(y) See Sug. 14th ed. 695.
(z) Baugh v. Price, (1752) 1 Wils. 320; see Howell v. H., (1837) 2 My. & C. 478; and Turner v. Trelawny, (1841) 12 Si. 49; 10 L. J. Ch. 249.
(a) York Buildings Co. v. Mackenzie, (1795) 8 Bro. P. C. 56, 71.
(b) Ex p. Hughes, (1802) 6 Ves. 617. Necessary repairs are allowed for, even in cases of fraud: Baugh v. Price, sup.
(c) Ex p. James, (1803) 8 Ves. 337.
(d) Ex p. Bennett, (1805) 10 Ves. at p. 401.
(e) Silkstone and Haigh Moor, etc. v. Edey, 1900, 1 Ch. 167; 69 L. J. Ch. 73.
(f) Bobinson v. Ridley, (1821) 6 Mad. 2.
To buy or sell real estate. 45
Must produce deeds.
The estate, if put up for resale, will be put up at the amount due to the purchaser, ascertained as just mentioned (i), and, if there is no advance, he must keep the estate; in one case, where permanent improvements had been made, it was put up at its improved value, subject to the question whether he should be allowed the amount of such improvements (k).