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vided that upon the decease of all of said children the trustees were to "select and appoint three or more gentlemen, who shall be informed of the facts by the trustees, and shall determine how, by the payments to permanently established and incorporated charitable institutions, my wish to benefit the poor shall be carried into effect.” One of the trustees having died, held, that the power to appoint remained in survivor, being coupled with an interest, and not a mere naked power. Loring v. Marsh, 2 Cliff., 469.
$ 428. In case of covenant to three trustees jointly, if two of such trustees die the survivor may sue alone. Crocker v. Beal, 1 Low., 416.
$ 429. A. conveyed certain property to B. and C. jointly in trust to pay certain debts due to the trustees and others, and pay the proceeds to himself, with a joint power to the two trustees to sell at public or private sale. Held, that if at the death of A, they had no interest in the property their power did not survive; that the trust was joint and could not be executed by one; that on the death of one the trust failed, and that a conveyance by one was absolately void. Boove v. Clarke, * 3 Cr. C. C., 389.
$ 430. Removal.- If trustees abandon their trust or are guilty of neglect and misconduct, the parties aggrieved may have them removed and new ones appointed. Sevens v. Eldridge, 4 Cliff., 348.
$ 431. A. bequeathed one-half his estate to B. in trust for C. during his natural life, to be invested in securities, and the income to be paid to C. semi-annually. B., as executor, turned over to himself, as trustee, the amount bequeathed to himself as trustee, and executed a receipt therefor from himself as trustee to himself as executor, and gave bond and security for the faithful administration of said trust fund. B. neglected for two years to invest the sum so receipted for, and to pay C. any portion of his share of the income from the estate of A., and became insolvent. Held, that (1) it was the duty of the court to remove B. from his trusteeship and appoint some suitable person, whose duty will be to proceed to collect from him and his sureties the principal sum received by B., with interest from the time it came into his hands, the interest, when collected, to be payable to C., the principal to be invested by the trustee as provided by the will, and the semi-annual interest to be paid by such trustee to C.; (2) it will be the duty of the trustee to proceed to collect from B. and his sureties one-half of any income he may have received from said real estate since it came into the hands of B., and also to take measures to recover in the future the portion of the income from said real estate which belongs to C. and pay the same over to him. Cavender v. Cavender, * 8 Fed. R., 641; 3 McC., 158.
$ 432. becanse of ill-feeling between trustee and cestui que trust.- Where a trustee is charged with an active trust which gives him some discretionary power over the rights of the cestui que trust and brings him into constant personal intercourse with the latter, strong mutual ill-feeling between the two may justify the removal of the trustee; but where the duties of the trustee are inerely ministerial, are clearly defined and require no personal intercourse with the cestui que trust, no change by the court is justified. This is especially so where there is another trustee with equal power, without whom nothing can be done. McPherson v. Cox, 6 Otto, 404.
§ 433. of absent trustee - His acquiescence in effect of.- Where a trustee has been removed by a decree of a court of chancery during his absence in time of war, in the enemy's country, and at the close of hostilities learns of his removal and the appointment of his successor, and remains quiescent for ten years, making no efforts to perform any of the duties of the trustee, and setting up no claim to the office during that time, such conduct must be considered as an abandonment of any title he may have had to the office of trustee and an acquiescence in the order of things established by the decree of the court ordering his removal. Ketchum v. Mobile & Ohio Railroad Co., 2 Woods, 532.
$ 434. Where application is made to a court of chancery by the settler of a trust, alleging neglect of duty on the part of the trustee, and praying that he, being a naked trustee, might be removed and a new one appointed, it was competent for the court to do so, ex parte, in the conservation of the trust property lying within its jurisdiction, although no service was possible on the absent trustee except by publication. Ibid.
$ 435. The fact that a naked trustee is absent in the enemy's country in time of war is amplo ground for his removal and the appointment of another trustee. Ibid. S 436.
of trustce of passive trust.- Where, by a contract between several parties, a trust was created and trustees were appointed, the trust not to take effect, however, till the happening of a certain event, held, that until the happening of the event the trust was passive, and that before that time the court would not, at the instance of one of the parties, interfere to remove the trustees for alleged misfeasance. Sloo v. Law, 1 Blatch., 512.
$ 437. Substitution of new trustees — Their powers.— The trustee of a family settlement, in which infants are interested, may be changed by consent of the parties upon a bill filed for that purpose only. Young v. Young, 4 Cr. C. C., 499.
§ 438. Where, upon the resignation of a trustee appointed by will, another is substituted, such substituted trustee does not acquire a discretionary power, vested in the former trustee by the terms of the will, to sell the trust property. Partee v. Thomas, 11 Fed. R., 769.
$ 439. An act of a state legislature in substituting trustees for those named in a will is not void as impairing the obligation of a contract, as no element of contract is involved in the matter. Williamson v. Suydam, * 6 Wall., 723.
$ 440. by legislature - Powers of chancellor.- Where the trustees in a trust deed made to secure bondholders of a certain railroad foreclosed the mortgage and leased the road to third parties, after which a majority of the bondholders of the defunct corporation converted their bonds into stock, and formed a new corporation, which by state statute was substituted as trustee for the other bondholders in place of the original trustees, held, that it was beyond the power of the legislature, without the consent of the cestuis que trust, to substitute a new trustee in place of the persons named in the mortgage. Knapp v. Railroad Co., 20 Wall., 117.
$ 441, Land was devised to trustees for the use of I. for life, remainder to I.'s children. On petition the state legislature discharged the trustees and authorized the chancellor to appoint trustees to divide the land as soon as they conveniently could into two moieties, one to be held on the terms of the trust, the remainder to be sold and the interest on the invested proceeds to be paid to I. The chancellor thereupon ordered that the eastern moiety be sold. Subsequently the legislature authorized the trustee under the order heretofore granted by the chancellor, or under any subsequent order, either to mortgage or sell the premises which the chancellor had permitted or might thereafter permit bim to sell as trustee. Held, that the authority of the chancellor to make partition was not exhausted, but that he had authority to divide the land by an east and west line and order the sale of the southern moiety instead of the eastern. Williamson v. Suydam, * 6 Wall., 723.
$ 442. M. devised certain land to three trustees and their heirs in trust to collect and pay rents to I. during his life, and on his death to convey the same to his children then living, and, in default of children living, to C. and his heirs. C. having conveyed his interest to I., the latter petitioned the legislature for relief, and was by special act substituted as trustee and authorized to sell a moiety of the land as trustee, with the assent of the chancellor; and it was provided that so much of the proceeds should be invested by the trustee as the chancellor should direct, and the income applied to the support af the family of I. Next year a further act was passed by the legislature authorizing I. to sell or mortgage the premises which the chancellor had permitted or might permit him to sell, and apply the proceeds to the purposes required, or that might be required, by the chancellor under previous acts. On application to him by I. it was ordered that I. be authorized to sell or mortgage the moiety of the estate as provided in the several acts, and also to convey any part of it in payment of any debt owing by him upon a valuation to be made, provided that every such sale, mortgage or satisfaction be approved by a master in chancery and his certificate of approval indorsed on each such conveyance, and that I, apply the proceeds to the payment of his debts and invest the remainder as he may deem proper to yield an income for the support of his family. I. sold part of the lands to G., the consideration being a debt due from I. to him, and certain wild land. The master refused to approve the transaction. Held, that the acts of the legislature divested the estate of the testamentary trustees, but did not vest the fee in I., and that his interest was that of trustee simply, to sell or mortgage with the assent of the chancellor; that the jurisdiction of the chancellor in the matter was strictly limited to that conferred by the acts, and that he could not in connection therewith exercise his ordinary jurisdiction; that the act contein plated a sale for cash only, and an exchange for indebtedness and wild land, though permitted by the order of the chancellor, was void and conferred no title, especially as the provisions of the order required the approval of a master, which had been refused and never given or waived; that the power to sell or mortgage was not exhausted by the fact that I. bad mortgaged the lands and subsequently paid the mortgage, but that he might again mortgage or sell, and also that the grantee of G. obtained no title, claim ing as he did under the void acts of the chancellor and I. Williamson v. Berry,* 8 How., 495 Williamson v. Irish Presbyterian Congregation,* 8 How., 565; Williamson v. Ball,* 8 How., 566.
$ 443. Miscellaneous.- Where a trustee refuses to perform a trust a court of equity wil. intervene and appoint a receiver, whether there is danger of ultimate loss or not. Wilmer v. Atlanta & Richmond Air Line R’y Co., 2 Woods, 409.
S 441. Under the trustee process of Massachusetts, by statute of 1794, if the trustee swears he has no goods, effects or credits of the debtor in his hands, he is entitled to be discharged, unless, from other parts of his disclosure, that averment is overthrown, United States v. Langton, 5 Mason, 280. $ 445. Where the purposes of the trust have been satisfied, equity in a proper case will
compel a conveyance from the trustee to the cestui que trust, as he has the sole beneficial interest. James v. Atlantic Delaine Co., 3 Cliff., 614.
$ 446. Property held in trust by a bankrupt passes into the control of the assignee till another trustee is appointed. Carr v. Gale, 3 Woodb. & M., 38.
$ 447. The visitatorial power is a hereditament founded in property, and valuable in the intendment of law; and where it is invested in trustees, there can be no amotion of them from their corporate capacity, and no interference with the just exercise of their authority, unless it is reserved by the statutes of the foundation or the charter. The trustees are subject to the general superintendency of a court of chancery for any abuse of their trust. Allen v. McKeen, 1 Sumn., 276.
IX. CONSTRUCTIVE AND RESULTING TRUSTS.
SUMMARY — Furnishing money to purchase land, S 448.— Express trusts; statute of frauds,
$ 448. Where a person furnishes money towards the purchase of land to which the title is taken in the name of another, no resulting trust arises unless the amount furnished is some definite proportion of the whole, and is paid for some aliquot part of the property. Such trust must also arise, if at all, when the purchase is made, and cannot be created by liabilities afterwards assumed or subsequent advances. Olcott v. Bynum, S450-453.
$ 449. In the statutes of North Carolina there is no provision similar to the seventh section of the statute of frauds (29 Car. II., ch. 3), and express trusts “manifested and proved,” as required by that section, are left in that state as at common law. Ibid.
[NOTES.- See SS 454-509.)
OLCOTT v. BYNUM.
(17 Wallace, 44-64. 1872.)
ERROR to U. S. Circuit Court, District of North Carolina.
STATEMENT OF Facts.— The object and prayer of the bill in this case are to redeem certain premises therein described, consisting of upwards of fourteen thousand acres of land, sold by the defendants Bynum and Grier to the defendant Sloan, under a mortgage containing a power of sale. The mortgage was executed by the defendant Hovey, and bears date the 1st day of January, 1859. Bynum and Grier, as trustees for the High Shoals Manufacturing Company, were the mortgagees. The mortgage recites that Hovey had executed to Bynum and Grier a penal bond in the sum of $80,000 to secure the payment of $40,000 in three instalments of $13,333.33 each, the first payable on the 1st day of January, 1860, the second on the 1st of July, 1860, and the third on the 1st of January, 1861, all with interest from the 1st of January, 1859. It was conditioned that in default of payment of either of the instalments or the interest thereon, or of any part of either when due, it should be lawful for the mortgagees to sell at public auction all the mortgaged premises, and to make and deliver to the purchaser a deed in fee-simple, and out of the moneys arising from the sale to retain the amount of the principal and interest which should then be due on the bond, together with the costs and charges of advertising and selling, rendering the overplus, if any, to the mortgagor, his heirs or assigns; "which sale so to be made," it was provided,
“ “shall forever be a perpetual bar, both in law and equity, against the mortgagor, his heirs and assigns, and all other persons claiming or to claim the premises, or any part thereof, by, from, or under him, them, or either of them.”
Default having been made in the payment of the first instalment, due Jan'uary 1, 1860, the mortgagees advertised the premises to be sold on the ensuing
28th of April, and then sold them for the sum of $43,500 to Sloan, to be held by him in trust for the High Shoals Manufacturing Company, the cestui que trust of the mortgagees.
At the time of the sale and conveyance to Hovey a down payment was made consisting of $6,157 in cash, and a receipt to Bynum by Eben S. Stephenson for certain dividends to which Stephenson was entitled, which, added to the cash, made an aggregate of $7,853.33. The bond and mortgage were given to secure the residue of the purchase money. The bill charges that this payment was made by Olcott and Stephenson jointly; that Hovey was a man of no means, and that he bought and took the title as the agent of the complainant and Stephenson, wholly in trust for them, and that on the 8th day of January, 1860, eight days after the title was conveyed to him, he conveyed to them all his interest in the property, and that, on the 18th day of December, 1867, Stephenson conveyed all his interest to the complainant. These allegations, so far as they relate to the agency of Hovey, are clearly proved by the testimony of Hovey himself and of the complainant, and there is nothing in the record which tends in any degree to contradict them. Sufficient evidence was produced in the court below of the execution of the deed from Stephenson to the complainant. The evidence offered as to the deed from Hovey to the complainant and Stephenson consisted of proof of the loss of the original and a certified copy from the proper register's office in North Carolina of a copy which had been registered there.
$ 450. The laws of North Carolina do not authorize the registration of a copy of a deed, and a certified copy of a registered copy is not evidence.
It was held by the court below that this evidence was incompetent to establish the existence of the lost deed, and that the complainant had therefore failed to show any connection with the property in question. Upon the ground of this objection the bill was dismissed. Whether this ruling was correct is an inquiry which meets us at the threshold of our examination of the
It is one to be determined by the lex loci rei sitæ. It is to be considered solely in the light of the statutes and adjudications of North Carolina. This court must hold and administer the law upon the subject as if it were sitting as a local court of that state. In the revised code of 1854 we find the following language. It is a re-enactment of the provision of the act of 1715 on the same subject: “No conveyance for land shall be good and available in law unless the same shall be acknowledged by the grantor, or proved on oath by one or more witnesses in the manner hereinafter directed, and registered in the county where the land shall be, within two years after the date of said deed, and all deeds so executed and registered shall be valid and pass estates in land without livery of seizin, attornment, or other ceremony whatever.” Ch. 37, § 1. Sections 3, 4 and 5 of chapter 37, and section 2 of chapter 21, provide for the execution in other states of deeds for lands in North Carolina and their registration in the proper county; but we have found no provision authorizing the registration of a copy. In Patton and Erwin's Lessee v. Reily, 1 Cooke, 125, in the supreme court of Tennessee, an original unregistered deed was offered in evidence. It was objected to upon the ground of the want of registration. The court said: “Registration was intended to stand in the place of livery of scizin. By the common law no estate could pass without livery of seizin, and the same may be said of its substitute. Lands as conveyed by this deed would not pass the estate at common law, and if it will pass,
it must be by act of assembly. The act of 1715 required the deed to be regis
tered before a legal estate is vested in the grantee. To create a title under this act of assembly, the party claiming the benefit of it must have complied with its requisitions. One of them is that the deed shall be registered. This deed cannot be read in evidence.” The plaintiffs were nonsuited. Patton and Erwin's Lessee v. Brown, id., 126, is to the same effect. Such is the settled law of North Carolina upon the subject. Hogan v. Strayhorn, 65 N. C., 279; Ivey v. Granberry, 66 id., 223; Hodges v. Hodges, 2 Dev. & Batt. Eq, 72. The original deed from Hovey to Olcott and Stephenson never having been registered, and the registration of the copy being unauthorized, it follows that the certified copy of the registered copy was a nullity, and could give no legal right to the grantees which the circuit court could recognize. We hold, therefore, that the ruling upon this subject was correct. Obviously, a proceeding in equity had specially for that purpose, and bringing the proper parties before court, is the appropriate remedy for the complainant to establish the lost deed and give it efficacy, and in no other way can this be done. Hodges v. Hodges, supra.
It has been insisted, in behalf of the complainant, that there was a resulting trust in favor of the complainant and Stephenson, arising from the circumstances of the transaction at the time of the conveyance to Hovey.
$ 451. A resulting trust can only arise as to the amount actually paid, and cannot originate in payments made after the purchase.
Where the purchase money is all paid by one, and the property is conveyed to another, there is a resulting trust in favor of the party paying, unless there be something which takes the case out of the operation of the general rule. But where he furnishes only a part of the amount paid no trust arises unless his part is some definite portion of the whole, and is paid for some aliquot part of the property, as a fourth, a third, or a moiety. White v. Carpenter, 2 Paige, 241; Sayre v. Townsend, 15 Wend., 650. There must be no uncertainty as to the proportion of the property to which the trust extends. Baker v. Vining, 30 Me., 127. Here the amount paid was $7,853.33, and it was paid without reference to any specific part of the property. Hence the principle in question does not apply. But if it did, it could do so only to the extent of the actual payment. It could certainly have no application in respect to the $40,000 for which Hovey gave his obligation, and for which Olcott and Stephenson assumed no liability to the grantors of the estate.
Such a trust must arise, if at all, at the time the purchase is made. The funds must then be advanced and invested. It cannot be created by after-advances or funds subsequently furnished. It does not arise upon subsequent payments under a contract by another to purchase. Buck v. Swazey, 35 Me., 51; Conner v. Lewis, 4 Shep., 274. A trust to the extent of the payment made, if it existed, would not support the case made in the bill. The complainant claims to have owned the entire estate.
$ 452. Statute of frauds.
But the bill sets out clearly and fully a case of express trust, and if the seventh section of the statute of frauds applied, the trust would be sufficiently “manifested and proved” by the deposition of Hovey to give it effect. Browne on the Statute of Frauds, 94; Tiffany on Trusts and Trustees, 191; Pinney v. Fellows, 15 Vt., 525; Seaman v. Cook, 14 Ill., 503. But there is no such statutory provision in North Carolina, and the case stands in this aspect as it would at the common law before the enactment of the 29th Car. II., ch. 3. Foy v. Foy, 2 Hay w., 131.