Court Opinion

ID: 3618956
Source: CourtListenerOpinion
Date Created: 2016-07-06 00:01:17.600426+00
Date Added: 2024-06-11T12:47:03.713358
License: Public Domain

[EDITORS' NOTE:  THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] *Page 570 
[EDITORS' NOTE:  THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] *Page 571 
(After discussing various exceptions taken on the trial to the reception of evidence.) If a new trial should be granted, it will save expense to the parties if the court should now dispose of the question whether it was competent for the parties to prove a trust in this case by parol, and if so, whether a trust has been established by the evidence.
The facts found are, that Mrs. Swinburne, after the death of her husband, took in her own name, for the benefit of the family, a contract for the 60 acres, and paid money upon it. That at her request, without the knowledge or consent of the other heirs, the defendant took a new contract for the same premises, in his own name, either for the benefit of the family or in fraud of their rights; that he thereafter took a deed to himself, sold the land and received and applied the avails to his own use and refuses to account.
It seems to me the case of Lounsbury v. Purdy, (18 N Y Rep. 515,) is decisive of this case. In that case Duncan purchased the premises of Merrill in trust for the plaintiff, a married woman, but the trust was not created or declared by writing. The plaintiff paid $100 of the purchase money down. Duncan and one Purdy gave a note for $423, which was to be and was afterwards paid out of the plaintiff's means, and the balance was paid by assuming a prior mortgage on the premises. The plaintiff did not consent to Q. taking the deed in his own name without declaring the trust. She knew and consented that the deed be taken in the name of either Q. or one Purdy. It was held that there was a valid resulting trust in favor of the plaintiff, and that the giving the note was to be regarded as equivalent to a payment by her.
The distinctions between the two cases are, that in that case, there was no interest in the plaintiff until the purchase *Page 572 
by the trustee; in this, the heirs of Peter Swinburne had an interest prior to either the defendant's contract or deed. In that case the plaintiff knew that her brother or Purdy was to take the title in his name; in this, the heirs did not know of any such intention. In this case, therefore, these important considerations are clearly proved, and establish in connection with the other facts found, a resulting trust.
The consideration in the case cited was paid by the cestui quetrust; in this case in part only by the cestuis que trust. But the only effect of such payment by the trustee is to give him a lien on the trust property till he is repaid. A trustee can not appropriate the trust property to his own use because he may pay out of his own pocket a part of the price, and thereby deprive the cestui que trust of his interest in the property, or limit that interest to the amount actually paid. This would be in violation of a well settled equitable rule that the trustee can not deal with the property for his own benefit. All profit made from it belongs to the cestui que trust.
The vendor, before the deed to the defendant, held the title in trust for the heirs of Peter. The defendant purchased of him with full knowledge of these rights, and thus the trust which bound the property in the hands of the vendor followed it into the hands of the defendant. (Story's Eq. § 1256.)
It was held in Van Horne v. Fonda, (5 John. Ch. 388,) that one tenant in common could not buy in an outstanding title for his own benefit and exclude his co-tenants from an interest therein. If he may not buy in an outstanding title, much less may he buy in a title that cuts off altogether the title under which he and his co-tenants hold.
In Burrel v. Bull, (3 Sandf. Ch. 16,) three joint owners of a lease deputed one of their number to obtain a renewal for their joint benefit, and in violation of the rights of his co-owners he took the new lease in his own name; it was *Page 573 
held that he could not exclude the others from participating in the benefits of the new lease.
The same principle was applied in Featherstonhaugh v.Fenwick, (17 Ves. 298,) where one partner clandestinely renewed a lease of the premises on which the partnership business was carried on, in his own name, he was held to account for it as joint property.
I entertain no doubt but that it was competent for the plaintiffs to establish a trust in this case by parol; nor but that on the evidence a valid resulting trust is established, and that the plaintiffs are entitled to relief. But competent evidence was excluded, and for that reason the judgment should be reversed and a new trial ordered.
The dower of the widow seems to be recoverable in this case by the plaintiffs without any assignment or transfer from her to the plaintiffs. The former judgment in this case was reversed because the plaintiffs recovered for the dower interest. The judgment should be reversed for this reason.
All the judges concurred on the point respecting the establishing of a trust by parol; and upon the point that dower was improperly allowed the plaintiffs; though the widow was entitled to dower.
Judgment reversed. *Page 574