The Sun.
London, England, 1839-11-15 00:00:00

ROLLS' COURT-(THIS

_. war..

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This case was opened yesterday by Mr. PEMBER
TOE, who, with Messrs. KINDERSLEY and KEN VON
PARKER, appeared for the plaintiff.
From the Learned Counsel's statement it appeared
that the bill was filed by the plaintiff, Joseph Culling-
worth, against Messrs. Jones, Lloyd, end Co., the
bankers, and Lord Howden ; and the object of it was to
set aside a security which Messrs. Lloyds had obtained
from Mr. Cullingworth, and to charge them with the
value of the estate included in that security, they having
sold it to Lord Howden, as the plaintiff contended, at
a very great undervalue. Lord Howden had since died,
but the plaintiff being satisfied with the responsibility
of Messrs. Lloyds, had not brought his Lordship's re-
presentatives before the Court. The plaintiff, in the
year 1830, carried on business as a calico printer at
Manchester, in partnership with a Michael Addy. They
employed the Messrs. Lloyds, at Manchester, as their
bankers, and to secure the amount of their account,
Mr. Cullingworth deposited with Messrs. Lloyds the title
(feeds of an estate in Durham, belonging to himself,
called the West Moor-house Estate, which consisted of
a farm-house with 65 acres of land, and under which
there were coal mines of great value. The partnership
not being attended with success, Messrs. Cullingworth
and Addy, in the course of the year 1830, determined
to wind up their affairs, and for that purpose they de-
ployed a Mr. Edmund Grundy, to whom they executed
a general power of attorney, dated December 31 in that
year, for the purpose of winding up the affairs of the
partnership, realising the assets, selling the goods, and
making such purchases as might be necessary for com-
pleting the orders on hand. Messrs. Lloyd and Co.
then thought it desirable that their deposit should be
converted into a legal mcrtgage, and accordingly, deeds
of lease and release, dated:the 10th and 11th of March,
1831, were executed between Cullingworth, of the first
part, the plaintiff, and Addy, as copartners, of the
second part, and Lloyd and Co., of the third part ;
and after reciting that there was a balance
of 2,024/. 15s. 2d. due from the partnership to Messrs.
Lloyds, it stipulated that that sum was to be paid on
the 11th of September following, but there was a pro-
viso for redemption on payment of the debt with inte-
rest at 5 per cent. ; and then there was a proviso that
if default should he made by Addy and the plaintiff in
the payment of that sum, it should be lawful for
Messrs. Lloyds, after the default, to sell or dispose
of the premises with or without the concurrence
of the plaintiff, either by public auction or private
contract as they should think fit. The plain-
tiff represented that at the time that transac-
tion took place he was in ill health, and incompetent
to understand what he was about, and that he was
taken in a hackney coach in a state of great debility to
execute the deed ; but Mr. Pemberton stated that in-
asmuch as the point on which the whole case turned
was totally independent of any grounds of that sort, he
did not mean to trouble the Court with going into
the evidence, which was very voluminous, re-
lative to the state of health of the plaintiff at the time.
In the latter end of the year 1831, and after that deed
was executed, Mr. Grundy found the property of the
partnership would not be sufficient to pay the creditors
in full, and he therefore proposed an arrangement, by
which 10s. in the pound was to be paid to the creditors
in discharge of their debts. Accordingly on the 26th of
October, 1831, a deed was prepared and executed,
containing a general release of the debts and a
4-eneral release of all securities which the cre-
ditors might have from the partners, or either of the
partners, for the payment of those debts, but reserving
to the creditors the right of retaining any securities
which they might have from other persons. On the
13th December, 1831, Messrs. Lloyds and Co. received
1,0121., being 10s. in the pound, and thereby, as the
)laintiff contended, by the very terms of the deed dis-
charged the security which they had on his estate.
Having received that dividend, Messrs. Lloyd and Co.
proceeded in the February following to put up the pro-
perty to sale. On the 3d of February, 1832, an
idvertisement, bearing date the Ist February, appeared
in the Durham newspapers, stating that this property
would be put up for sale, and reference was directed to
he made to Messrs. Duckworth, Denison, and Hum-
phries, the defendants' solicitors ; but on the said Ist
February the following letter was sent to Mr. Col-
lingworth, by Messrs. Duckworth and Denison :
" Sir,—We beg to inform you that, in pursuance of the
.trustsof the conveyance to them of the West Moor-house
farm, in the county of Durham, our clients, Messrs. Jones
Lloyd and Co. have this day contracted to sell the
estate to Lord Howden for 8001., being the full amount
of Mr. Robert Grundy's valuation. You will be grati-
fied to hear that Mr. Lloyd is well satisfied with having
effected this sale." In March, 1832, the estate was con-
veyed by Messrs. Lloydand Co. to Lord Howden (whose
lands, according to the advertisement, bounded it on the
North and West) for 800/. Mr. Cullingworth refused
to be a party to the sale. The estate thus sold for 800/.
was computed by some witnesses to be worth 20,000/.
The land, independent of the coal mines, was worth
about 1,5001. The bill, therefore, prayed that this
transaction might be set aside ; or, if the Court should
be of opinion it could not be set aside, that the defend-
Ants might be charged with the full value of the estate.
Mr. PEMBERTON contended, first, that the transaac-
tion was invalid because the acceptance of the composi-
tion of 10s. in the pound, discharged the security in
equity, and having received the composition and exe-
cuted that deed, by which all the creditors were put on
an &ILI footing the defendants had no right to sell ;
and, secondly, that even if the the power of sale re•
mained, it made them trustees that they were bound to
execute that trust like all other trustees, with a due re-
. and to the interests of their cestuique trusts ; and that
therefore they must be answerable for their imprudence.
Mr. RICHARDS, who appeared for the defendants,
wished to know whether Mr. Pemberton intended to
abandon that portion of the bill which related to the
fraudulent conduct of Messrs. Lloyd and Co. Two.
thirds of the bill consisted in imputing a gross fraud to
the defendants?
Mr. PEMBERTON replied that he did not intend to
abandon any thing. There certainly was an allegation
made in the bill, and, in his opinion, sustained,
but which, as he had stated, he did not
hink necessary to trouble the Court with, as the case
might be decided on two other points. He therefore
,rep seci to enter the whole of the evidence as read,
tru.l conesel for the defendants could comment on any
part of it they chose, but at present he thought it was
ffily necessary to read those portions of the evidence
chich bore on the two points he had stated to the
Court.
Mr. Kindersley and Mr. Kenyon Parker having been
heard on the same side,
Mr. RICHARDS then proceeded to address the Court,
an bellall of the defendants Jones, Lloyd, and Co , and
commented very strongly on the course which the plain-
tiff had pursued, in having introduced charges of fraud
an the record against a respectable firm, and attempted
;,o support those charges by evidence which they were
.ishamed to read to the Court. Whatever view, there-
fore, the Court might take upon the other points of
the case, he apprehended, with respect to so
much of the bill as related to the charge of

fraud, it most be dismissed with costs. There
had been no fraud on the creditors of Cullingworth
and Addy, no secret arangement with, and con-
cealment on the part orMaessrs Lloyd ; and if they
had committed any fraud, it was a fraud for the benefit
of Lord Howden, and not for themselves. The evi-
dence in the cause showed that the property in ques-
tion was represented to Messrs. Lloyd as not worth
7001., and it was not yet ascertained that there was
coal under the land. Lord Howden had offered to give
up the property to the plaintiff on his paying him the
sum he gave for it, and the expences he had incurred.
But the plaintiff could, if he had thought proper, have
prevented the sale being perfected, and prevented Lord
Howden purchasing the property ; but instead of doing
so, although he knew on the Ist February 1832 that
the defendants were about to sell the property, he had
never interfered to prevent the contract being carried
into effect, nor had he made any complaint of
that which he now alleged to be a gross
fraud. Was it therefore tolbe endured, that after
the time that had elapsed, the plaintiff should be at
liberty to unravel those transactions which were com-
pleted and perfected with his knowledge in June 1832,
and seek to charge the defendants with the enormous
sum of 20,0001. At the time Lord Howden pur-
chased the property there was a tenant in posses-
sion of it, at a rent of 251. per annum, and who
actually quitted it because his Lordship would not
reduce the rent. The Learned Counsel, in conclusion,
submitted that the case of the plaintiff had entirely
failed, and that the bill must be dismissed with costs.
Mr. SUTTON SHARPE waseehaedninwgethweeenvtidto esenpereis.n
support of the defendant's case w