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114 IMPLIED TRUSTS. the authority of A. or B., D. draws a cheque on the trust account for the amount, X. and Y. apply the cheque in discharge of the bill. They know that the 7701. is trust money. X. and T. must repay the 750/. to the trust account. Bridgman v. Gill (1857), 24 Beav. 302. 3. A. and B., trustees, employ X., a solicitor, to receive the proceeds of part of the trust estate from a purchaser. X. pays the money to A. alone, without B.'s authority or receipt. A. misappropriates it and dies insolvent. X. is a constructive trustee, and must make good the loss to the trust estate. Lee v. Sankey (1872), L. E. 15 Eq. 204. B.— Cases in which Agent held not liable as Trustee. 1. A. and B., trustees, employ X. and Y., bankers, to collect assets forming part of the trust fund. X. and Y. receive the assets and apply them in payment of bills drawn on them by A. and B. In drawing the bills A. and B. in fact commit a breach of trust, but X. and Y. are unaware of this. X. and Y. are not liable as constructive trustees. Ream v. Robarts (1819), 4 Madd. 332. 2. A., a sole surviving trustee, desires to retire and appoint B. in his place. He instructs X., a solicitor, to prepare the necessary documents. X. advises A. against appointing B. as sole trustee, but A. insists, and X. prepares a deed of appointment of B. as sole trustee and a deed of indemnity. Y., another solicitor, approves the deeds on behalf of C., the ccstni que trust, after having pointed out to 0. the risk of loss of the trust fund, and obtained C.'s express instructions to carry out the arrangement. B. misappropriates the trust fund. Neither X. nor Y. ever has control of the trust fund, nor have they any apprehension of any fraudulent design on the part of A. or B. Neither X. nor Y. is liable as a constructive trustee. Barnes v. Addy (1874), L. E. 9 Ch. 244. 3. A. is a sole trustee. It is arranged that A. shall not be entitled to draw on the trust account at the bank without the concurrence of B. and 0., who are to initial her cheques. A. draws and B. and 0. initial cheques on the account, for purposes which, as B. and C. are aware, are a breach of the trust. B. and 0. do not thereby become constructive trustees. In re Barney, (1892) 2 Ch. 265.
CONSTRUCTIVE TRUSTS. 115 4. A. and B. are trustees, B. being the active trustee. It is suspected that B. has invested part of the trust funds on worthless securities, and it is consequently arranged that A. shall retire and X. shall be appointed trustee in his place. A solicitor prepares a deed for the purpose, which, however, is not executed. The solicitor also induces B. to take over the worthless securities himself, and eventually B. pays the whole of the trust funds in cash into a bank in the joint names of himself and X. X. and the beneficiaries ask the solicitor to find other investments for the trust moneys, and at the solicitor's suggestion they are invested on mortgages, X. and B. drawing cheques on the account at the bank, which are handed to the solicitor, who pays the proceeds to the various mortgagors. The mortgages are an improper investment, and the trust moneys are lost. The solicitor is not liable as a constructive trustee. Mara v. Brotcne, (1896) 1 Ch. 199. Constructive trustees, who are such under the rule stated in this chapter, are not entitled to plead the statute of limitations against the beneficiaries, except under s. 8. of the Trustee Act, 1888. (See Soar v. Ashwell, (1893) 2 Q. B. 390, especially the judgment of Kay, L. J., at p. 405.)
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UNIVERSITY OF LONDON INSTITUTE OF A
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A THESIS UPON THE DEFINITION, CLASS
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TABLE OF CONTENTS. PAOK INTRODUCTOR
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INTRODUCTORY. THE term "trust" has
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Part L—TBUSTS IN GENEBAL. CHAPTEE
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DEFINITION OF A TRUST. 3 active or
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DEFINITION OF A TEUST. 5 owner. Thi
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DEFINITION OF A TEUST. 7 Mr. Justic
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DEFINITION OF A TRUST. 9 courts the
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DEFINITION OF A TRUST. 11 since the
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CLASSIFICATION OF TRUSTS. 13 constr
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CAPACITY OF PARTIES. 15 CHAPTEE III
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CAPACITY OF PARTIES. 17 The sanctio
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CAPACITY OF PARTIES. 19 party to it
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CAPACITY OF PARTIES. 21 Lunacy also
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THE TRUST PROPERTY. 23 CHAPTER IV.
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THE TRUST PROPERTY. 25 expectancy o
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CREATION OF EXPRESS TRUSTS OF LAND.
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CREATION OF OTHER EXPRESS TRUSTS. 2
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RULES DETERMINING INTENTION TO CREA
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ENFORCEABILITY OF EXPRESS TRUSTS. 5
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ENFOECEABILITY OF EXPRESS TRUSTS. 5
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DISCLAIMER OF EXPRESS TRUST, 61 CHA
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Page 83 and 84: CONSTRUCTION OF EXPEESS TRUSTS. 71
Page 87 and 88: INVALIDATING CAUSES. 75 CHAPTER XI.
Page 89 and 90: INVALIDATING CAUSES. 77 Guardian an
Page 91 and 92: INVALIDATING CAUSES. 79 upon good (
Page 93 and 94: INVALIDATING CAUSES. 81 ment is not
Page 95 and 96: INVALIDATING CAUSES. 83 UNLAWFUL PU
Page 97 and 98: INVALIDATING CAUSES. 85 7. Testator
Page 99 and 100: INVALIDATING CAUSES. 87 Immoral Tru
Page 101 and 102: RESULTING TRUSTS. 89 Part IIL—IMP
Page 103 and 104: RESULTING TRUSTS. 91 to give the tr
Page 105 and 106: RESULTING TRUSTS. 93 satisfied with
Page 107 and 108: RESULTING TRUSTS. 95 tion of A.'s e
Page 109 and 110: RESULTING TRUSTS. 97 or successive,
Page 111 and 112: RESULTING TRUSTS. 99 4. Copyhold la
Page 113 and 114: RESULTING TRUSTS. 101 Lastly, if A.
Page 115 and 116: RESULTING TRUSTS. 103 It does not s
Page 117 and 118: RESULTING TRUSTS. 105 CHAPTER XV.
Page 119 and 120: CONSTRUCTIVE TRUSTS. 107 B.—Const
Page 121 and 122: CONSTRUCTIVE TRUSTS. 109 quences of
Page 123 and 124: CONSTRUCTIVE TRUSTS. Ill (1857), 8
Page 125: CONSTRUCTIVE TRUSTS. 113 40 Ch. D.
Page 129 and 130: CONSTRUCTIVE TRUSTS. 117 The follow
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