Court Opinion

ID: 6413686
Source: CourtListenerOpinion
Date Created: 2022-06-25 11:54:33.533828+00
Date Added: 2024-06-11T15:51:27.752240
License: Public Domain

Chapman, J.
The indenture referred to in the bill and answer „ recites that the defendant and the other persons named, at the request and for the benefit of the plaintiffs, had taken a conveyance of the land in question, and made their notes and a mortgage of the land to secure the sum of fourteen thousand dollars. Then follows a stipulation that the plaintiffs shall pay the notes *186at maturity, take them up, and indemnify the makers. To secure the performance of this agreement, they appoint the defendant and Butler their agents to take possession of the property and manage and rent it, except so far as it may be used by the plaintiffs, with certain powers of investment and sale, and with the proceeds to pay the debt, and account with the plaintiffs for any balance that may remain in their hands. It is to continue in force till the liabilities of the mortgagors shall.be discharged.
1. It is objected that this instrument amounts to nothing more than a power of attorney, and does not create a trust, and therefore that the plaintiffs have no remedy in equity, but must resort to their action at law.
2. It is objected that if the instrument creates a trust, it still remains in force, though it is admitted that the plaintiffs have paid the debt and taken up the notes, and offered to give them up to the defendant, and have procured a discharge of the mortgage. It is alleged that though this debt is paid, it has been paid by borrowing money of the East Boston Savings Bank, upon a new mortgage of the property, and that the defendant has a right under the indenture to act as trustee of the plaintiffs until that debt also is paid. He contends that this right is created by the stipulation that he may reinvest the surplus funds received by him till a sufficient amount shall have accrued to discharge the mortgage debt and interest.
As to the first point, it is true that the indenture creates an agency. But it is a power to hold, manage and rent property, and invest and reinvest funds, and render an account to the plaintiffs. These things are in their nature a trust; and a trustee is always an agent acting for others, and not for himself. If the defendant violates the trust by refusing to account or to deliver up leases or securities, or by continuing to exercise his authority after it has ceased by the terms of the indenture, a suit in equity is the only plain, adequate and complete remedy which the plaintiffs can have.
As to the second point, the declared object of the indenture was to furnish security to the defendant and the other makers of the note, and the agreement is to continue in force only till *187that note is paid and discharged. There is no stipulation in respect to other debts. And the only fact that could make the defendant’s power irrevocable at any time was that it wt coupled with an interest to have his note discharged. Thai object having been accomplished, he has no further interest in the matter.
The injunction prayed for should be made perpetual, and an account should be taken.