Court Opinion

ID: 8315916
Source: CourtListenerOpinion
Date Created: 2022-10-17 20:01:13.94777+00
Date Added: 2024-06-11T16:44:55.852513
License: Public Domain

Cranch, C. J.,
to be considered in the vacation, who, on the 9th of July, 1835, filed the following opinion.
The answers having denied all restraint and undue influence, and having averred that the deed was made with a full knowledge of the nature and extent of the rights of the grantor; and these averments, being responsive to the allegations of the bill, are evidence for the defendants; and as there is no contradictory evidence, it is conclusive on that point.
The case of the complainants, therefore, rests wholly upon the invalidity of the deed by reason of the relative situation and circumstances of the parties at the time of the transaction.
It is the simple case of a deed of gift from a young daughter to a wealthy father, conveying all her property and leaving herself entirely destitute. Her estate was a reversion expectant upon the *545death of her father, who was tenant by the curtesy. She was, therefore, not only in a situation to be operated upon by parental influence, but in that of an expectant heir dealing for a reversion and parting with it for an inadequate consideration.
There are many cases decided upon the principle that the party contracting was not perfectly free to act, and the other party has availed himself of his power or influence; and in such cases it has not been deemed necessary that there should have been actual fraud or imposition ; but, from the relative situation of the parties, a court of equity will suppose that the party was not free to act, and will set aside the contract, as not having been made with his full and free assent. Among the relations, which a court of equity looks upon with a suspicious eye, are those of guardian and ward; parent and child; trustee and cesíui que trust; tutor and pupil; attorney and client; master and servant; and the cases of expectant heirs and reversioners. In all these eases, the court requires the party seeking to avail himself of the contract, to show that it -was fairly made, for full and valuable consideration, and with full knowledge, by the party sought to be bound by it, of all the circumstances, and of all his rights; and in some of these cases, the mere relation of the parties is sufficient to vacate the contract.
In Morse v. Royal, 12 Ves. 371, the Lord Chancellor said, “ The authorities connected with this case are not many, and the principles are perfectly clear. One class of cases is that of contracts that may be avoided, as being contrary to the policy of the law, which are interdicted for the wisest reasons. Of that kind are a deed of gift obtained by an attorney while engaged in the business of the author of that gift; a deed by an heir, when of age, to his guardian ; purchases of reversions from young heirs when of age.” “ To that class of cases I shall add the case of a trustee selling to himself. Without any consideration of fraud, or looking beyond the relation of the parties, that contract is void.” “ In all these instances there is no necessity for evidence; the contract is interdicted by the policy of the law.” “ I have no difficulty in saying I should not have regretted to have found that the rule extended even to such a case as this. Finding that there is so much difficulty in supporting a purchase by a trustee from the cestui que trust, that the transaction ought to be guarded with that-necessary degree of jealousy running so near the verge, it might better be embraced under the policy of the law.”
In Wright v. Proud, 13 Ves. 137, the principle of “ the rule of guardian and ward,” say the plaintiff’s counsel “ has been carried so far that a conveyance to a brother by an orphan living with him as one of his family, though no particular fraud appeared, *546was set aside upon the ground of the relation enabling him to exert an undue influence ; ” and they cited the case of Griffin v. De Venille, 3 Wood, App. 16; S. C. 1 Gwillim’s Bac. Ab. 109; 3 P. Williams, 131, Mr. Cox’s note.
In Osmond v. Fitzroy, 3 P. Williams, 131, the court said, “ young heirs, even when of age, are under the care of a court of equity.” In that case a voluntary bond by an heir twenty-seven years old, was set aside.
In the case of the Duke of Hamilton et ux. v. Lord Mohun, 1 P. Williams, 118, the Lord Chancellor said, that “ this was within the common case of equity’s relieving an heir against any private agreement with his father, upon the marriage of the heir ; as where the father covenants to settle an estate on the marriage, and the heir privately agrees to pay back so much out of it to the father ; the heir is under the awe of his parent, in such case and not supposed to act freely; for which reason courts of equity relieve against such private agreements.”
In Hatch v. Hatch, 9 Ves. 292, 297, the Lord Chancellor said, “ If the court does not watch these transactions with a jealousy almost invincible, in a great majority of cases it will lend its assistance to fraud.”
In Cray v. Mansfield, 1 Vez. 381, the Master of the Bolls says, “ But there is another proper head of equity for the consideration of this court which will always hold a very strict hand over all deeds, purchases, and conveyances, obtained from young gentlemen soon after coming of age, by persons presuming too much on the confidence reposed in them, and drawing them in to execute the deeds.”
In Hylton v. Hylton, 2 Vez. 548, the Lord Chancellor said, “ Where a man acts as guardian, or trustee in the nature of guardian, for an infant, the court is extremely watchful to prevent that person’s taking any advantage immediately upon his ward or cestui que trust coming of age, and at the time of settling accounts, or delivering up the trust, because an undue advantage may be taken. It would give an opportunity, either by flattery or force, by good usage unfairly meant, or by bad usage imposed, to take such advantage ; and therefore the principle of the court is of the same nature with relief in this court on the head of public utility, as in bonds obtained from young heirs, and rewards given to an attorney pending a cause; and marriage brocage bonds. All depends on public utility; and therefore the court will not suffer it, though perhaps in a particular instance there may not be actual unfairness. Upon that ground I went in the case cited; in which I have added at the end of my note taken at .the hearing of the cause ‘ to be absolutely set aside; being *547between a guardian and his ward just come of age, and on reason of public utility.’ ”
.. In Waller v. Armistead’s Administrator, 2 Leigh, 14, the deed was by a ward of full age to his guardian.
The Court of Appeals in Virginia, said, “ So many undue advantages may be taken in such cases, by means of the influence which may in various ways be exercised by the guardian, that the law, on a principle of public policy, vacates all such conveyances without proof of any actual fraud whatever.”
In Kerby v. Taylor, 6 Johns. Ch. Rep. 249, the ward had given a release to her guardian, six months after she came of age. Chancellor Kent says, “ It,” (the release,) “ is not necessarily to have been presumed to have been obtained by undue influence, like bonds from young heirs, or gifts and conveyances, and lucrative bargains from wards.”
In Revett v. Harvey, 1 Simons fk Stuart, 502, the solicitor acted as guardian. The ward gave a 'release two months after he came of age. The Vice-Chancellor set it aside, saying, “ this case must be governed by the principles which apply to a guardian and his ward.”
In Butler v. Haskell, 4 Desaussure, 702, the court says, “ There seem to be two classes of decided cases on this subject; one where the relation of the parties is such that no contract can be permitted on any terms if sought tobe relieved against; as the case of attorneys dealing with clients ; or trustees selling to themselves ; the other where the relation of the parties does not interdict all contracts on the subject of the trust; but where a confidence being reposed, the court looks with a jealous eye at the. conduct of the agent, and will set aside the contract if there be any considerable inadequacy of price in the transaction; and more especially if there be any weakness or necessity in the vendor.”
In Carpenter v. Heriot, 1 Eden’s Rep. 342, the Lord Keeper said, ‘‘ It appears to me that the bond was obtained by paternal influence; I am, therefore, of opinion, that it ought to be can-celled.”
In Huguenin v. Basely, 14 Ves. 273, a deed by a widow to a clergyman and his family, obtained by religious influence and confidence, was set aside. See also Norton v. Relly, 2 Eden, Rep. 286, where an annuity was set aside, because obtained by spiritual ascendency and religious delusion.
■ In Grubbins v. Creed, 2 Sch. & Lefr. 217, the Lord Chancellor said, “ In the simple case of a mortgagor giving a lease to the mortgagee, there would not perhaps, be ground sufficient to impeach the lease ; but if there be any thing more, the court will *548look into the transaction with the greatest possible jealousy; and if it prove to be a contract for a lease in consideration of forbearance, it is a contract for more than the law allows for forbearance, and is then usurious. I do not think that this case comes precisely within that description ; but it is manifest that Creed took advantage of his situation as mortgagee; and if he did, the court cannot permit him to hold that advantage.”
In Evans v. Llewellyen, 1 Cox, Ch. Ca. 333, 339; S. C. 2 Bro. C. C. 150, the deed was set aside as improvidently obtained, for an inadequate consideration, from persons in low circumstances, and unapprised of their right until the time of the transaction, though no misrepresentation or actual fraud, whatever, appeared to have been used.
The Master of Nolls, Sir Lloyd Kenyon, (March 5th, 1787,) in p. 339, &c., said, “ The eases of infants dealing with guardians, and of sons with fathers, all proceed upon the same general principle, and establish this; that if the party is in a situation in which he is not a free agent, and is not equal to protecting himself, this court will protect him. I do not know that the court has drawn any line in this case, or said, thus far we will go but no farther ; it is sufficient for me to see that the party had not the protection which he ought to have bad, and therefore the court will harrow up the agreement. I am of opinion, in this case, the party was not competent to protect himself, and therefore this court is bound to afford him such protection ; and therefore these deeds ought to be set aside as being improvidently obtained.”
In Jeremy’s Eq. Jurisdiction, p. 399, it is said, “There are many cases in which this court will interfere to prevent improvident persons, or those claiming under them, from the consequences of their acts, where there is no express fraud, nor any peculiar relation between the parties; nor that injury to the interests of third persons, which would, separately, invalidate the transaction ; but in which there exists such a combination of circumstances, partaking, in a slight degree, of some or all of the grounds of suspicion hitherto noticed, as to induce this court to exert a control; and in respect to which it is held advisable not to give too particular reasons for its determinations.
In Gwynne v. Heaton, 1 Bro. C. C. 9, the Lord Chancellor (Thurlow) said, “ The heir of a family, dealing for an expectancy in that family, shall be distinguished from ordinary cases; and an unconscionable bargain, made with him, shall not only be looked upon as oppressive in the particular instance, and therefore avoided, but as pernicious in principle, and therefore repressed. This must be taken to be the established principle.” “ In those cases, fraud is not the ground of relief; it is the example and *549pernicious consequences. It is contended that this case is not within the view. I think no man’s case can be more so than an heir expectant of an estate tail, and the father in possession of another estate, so that he stood fully in the situation which has served as an example of unequal dealing, in former times.”
In Young v. Peachy, 2 Atk. 258, a conveyance, by a daughter to her father, obtained for one purpose, was attempted to be used by the father for another purpose. This was set aside.
Lord Chancellor Hardwicke says, (in p. 258,) “ In the present case the recovery was suffered for one purpose, and is attempted to be made use of for another ; and though it has been objected, the allowing the evidence of this sort is against the statute of frauds and perjuries, yet, if that objection should be allowed, the statute would tend to promote frauds, rather than prevent them; for these reasons, therefore, I declare, though there had been no other circumstances in the case, I should have been of opinion that the recovery ought to be set aside; but the case is greatly strengthened when 'it comes to be considered that this was a recovery obtained by a father from his child; and when that is the case, it affords another strong circumstance in order to relieve the plaintiffs.”
“ In the case of Glisson v. Ogden, before Lord Chancellor King, that circumstance was strongly relied upon; but his lordship refused to give relief; for he said it was a fair bargain between a father and his child, and he would not weigh in golden scales, whether the consideration was exactly even or not. In March, 1731, there was an appeal to the House of Lords from that decree: upon the appeal the lords laid great weight upon that circumstance, that the conveyance was obtained by'the father from his daughter in distress, and the decree of Lord Chancellor King was reversed.”
From these authorities, it seems to be perfectly clear, that the deed from Eleanor Jenkins to her father, George Jenkins, ought to be set aside, both on the ground of the relation of the parties, and the conveyance being of a reversion to the party who had the life estate, for an inadequate, or rather for no valuable consideration.
The interlocutory decree, suggested by the plaintiff’s counsel, may be drawn up.
The March term was then adjourned to the 27th of May; the Alexandria May term being held in the intermediate time.
A final decree, in favor of the complainants, was rendered in 1837, which was reversed, upon appeal to the Supreme Court, in 1838. 12 Peters, 241.