"Where one invested with an authority to sell or purchase in effect sells to or buys from himself, the persons by or on whose behalf the authority was conferred have the option of affirming or avoiding the transaction; and if they elect to affirm it, the person authorised is firmly bound and cannot maintain, as against them, that the purported exercise of his authority was void (2). As in the case of a conveyance induced by fraud or undue influence (a), affirmation of the transaction may be either express, or implied from the acts of the parties (b); as from long inaction (c), or in the case of a purchase from using the land as their own, after they have become aware of the facts entitling them to set the sale aside (d). But no inaction or user can be evidence of an intention to affirm the transaction, so long as the injured parties had no knowledge of the facts giving rise to the right to rescind (e). When the sale has been once affirmed, either expressly or impliedly, it cannot afterwards be set aside (f). If the injured parties choose to avoid the transaction, their rights vary according as the person, to whom the authority was given, did or did not stand in a fiduciary relation to them, and according as the authority were for sale or purchase. In the case of an authority given to a person in a fiduciary position to sell land, the injured parties may claim to have either a reconveyance to them or a resale for their benefit of the property in question, or if the trustee for sale have disposed of the land or any part thereof to a purchaser, from whom it cannot be recovered, they may claim to make the trustee accountable with interest at four per cent, (g) for any profit realised by him on such re-sale or else for the true value of the land over and above the price paid on the attempted sale to himself (h). And where the land has been so resold, the injured parties are entitled to an inquiry as to the true value of the land when sold by the trustee to himself and as to the profits realised on the resale, and may make the trustee account with interest for the profits realised by him or for the difference between the true value and the price at which he affected to take over the estate, as may be most beneficial to them (h). Where a reconveyance is claimed, the trustee for sale must account on the footing of wilful default, but without interest, for all rents and profits received or receivable by him since the sale, and he will be charged with an occupation rent for any part of the property, of which he has been himself in possession: but he may claim the return of his purchase money with interest at four per cent. and an allowance for necessary outgoings and substantial improvements and repairs (k). If a resale be desired, it will be ordered conditionally on the trustee for sale being obliged to adhere to his purchase in case the price obtained on the resale be less than what he gave for the land (/). If the land fetch a higher price on the resale, the trustee may claim to be recouped thereout all sums expended by him in necessary outgoings and substantial improvements or repairs: but he must account, as in the case of reconveyance, for all rents and profits received or receivable by him prior to the resale (l). Where there is no fiduciary relation between the person on whom the authority was conferred and those by whom or on whose behalf it was given, it does not appear that the latter can insist on resale if they elect to set the transaction aside; their rights appear to be confined to claiming a reconveyance on such terms as they would be entitled to demand it, if the transaction had never taken place. Thus, if they be mortgagors and the mortgagee has sold to himself in attempted exercise of his power of sale, their right is to redeem, that is, to demand a reconveyance on payment of principal and interest due on the mortgage debt, and costs (m). And the mortgagee, having in fact taken possession under colour of a sale to himself, is liable to account as a mortgagee in possession and on the footing of wilful default for all rents and profits actually received or possibly receivable by him in respect of the mortgaged property: but he does not incur the same liability exactly as a trustee for sale. Thus, where the mortgagee being in possession under a colourable sale has resold the whole or a part of the property to a purchaser, from whom it cannot be recovered, he is of course chargeable with the actual price received on the resale: but if he resold at a loss, or at an undervalue, he is not chargeable (as a trustee would be (n)) with the difference between the actual price obtained on the resale and the true value of the property at the time when he purchased it for himself, but can only be made to account for the difference between the price at which he actually resold and that for which he might, but for his wilful default or negligence, have sold the property to the sub-purchaser (o).

Eights of the persons injured by the improper exercise of an authority to sell or purchase.

Affirmation may be express or implied.

Where the person authorised is in a fiduciary-position, and the authority-is to sell.

(x) Above, p. 878, and n. (p). (y) Lewin on Trusts, 439, 6th ed.; 583, 11th ed.

(2) Expte. Hughes, 6 Ves. 617, 623 - 625.

{a) Above, pp. 744, 745, 767.

(b) Morse v. Royal, 12 Ves. 355.

(c) Gregory v. Gregory, G. Coop. 201, Jac. 631; Baker v. Read, 18 Beav. 398, 3 W. R. 118; and see Harcourt v. White, 28 Beav. 303, 309 - 311.

(d) Re Cape Breton Co., 29 Ch.

D. 795; Ladywell Mining Co. v. Brookes, 35 Ch. D. 400; Re Lady Forrest Mine, 1901, 1 Ch. 582.

(e) Randall v. Errington, 10 Ves. 423; Chalmer v. Bradley, 1 J. & W. 51, 67, 68; Charter v. Trevelyan, 11 Cl. & Fin. 714, 738, 739, 740; Life Association of Scotland v. Siddal, 3 De G. F. & J. 58, 74, 77; De Bussche v. Alt, 8 Ch. D. 286, 314; above, p. 767, and n. (t).

(/) See last note but one; above, p. 745.