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Argument for Appellees.

It is a principle of law, as well as of natural justice, that greater consideration and care are due to persons known to be unable to take care of themselves, than to those who are fully able to do so. Graffam v. Burgess, 117 U. S. 180.

The office of trustee is important to the community at large, and frequently most so to those least able to take care of themselves. It is one of confidence. The law regards the incumbent with jealous scrutiny, and frowns sternly at the slightest attempt to pervert his powers and duties for his own benefit. Railroad Company v. Durant, 95 U. S. 576.

These trustees knew the value of subdivision in securing good prices at the sale, and nevertheless sold square 111 as a whole. Such conduct between trustee and cestui que trust reaches far beyond what was necessary to be proved in this case in order to set the sales aside. When this relation subsists, the slightest obliquity, the slightest indirection is adequate, on grounds of public policy. Villa v. Rodriguez, 12 Wall. 323; Shaw v. Railroad Co., 100 U. S. 605. Reasonable certainty is all that is necessary in case of fraud. Kempner v. Churchill, 8 Wall. 362; Neale v. Neales, 9 Wall. 1; Rea v. Missouri, 17 Wall. 532; Graffam v. Burgess, 117 U. S. 180.

It was the duty of the trustees in making the sale to exercise that diligence and caution which a careful and prudent owner would observe in the sale of his own property. If the sale be made under circumstances of haste and imprudence, or if the trustees fail in reasonable diligence in inviting competition, or adopt an injudicious and disadvantageous mode of selling the property, a court of equity ought not to ratify the sale. Gould v. Chappell, 42 Maryland, 466; Ord v. Noel, 5 Madd. 438; Harper v. Hayes, 2 Gif. 210; Turner v. Harvey, 1 Jacob, 169; Bridger v. Rice, 1 Jac. & Walk. 73; Mortlock v. Buller, 10 Ves. 292; White v. Cuddon, 8 Cl. & Fin. 766.

Although the rule of law, as now firmly settled, is that a trustee may buy of his cestui que trust, provided there is a distinct and clear contract to that effect, made under such circumstances as indicate that the cestui que trust was aware of the correct value of the property, that the trustee had no

Argument for Appellees.

special knowledge of the value of the thing bought, which was not also possessed by the beneficiary, and that no unduc influence arising out of the trusteeship was brought to bear on the mind of the cestui que trust in a word, that they stood at such length to each other as amicable buyer and seller sustain ordinarily one to the other; yet it has been as distinctly decided that the relaxation does not extend to a purchase by a trustee at his own sale. Such a sale is ipso facto voidable by the cestui que trust, on ground of public policy. Lewin on Trusts, 438; Michoud v. Girod, 4 How.

503.

Fullness of price, absence of fraud, and fairness of sale are not sufficient to countervail this rule of policy. Armstrong v. Huston, 8 Ohio, 552; Ricketts v. Whittington, 15 Maryland, 46; Jamison v. Glascock, 29 Missouri, 191; Woodruff v. Cook, 2 Edw. Ch. 259; Spindler v. Atkinson, 3 Maryland, 409; S. C. 56 Am. Dec. 755.

The theory of the defence is that these cestuis que trustent are guilty of laches in not investigating and discovering these frauds. They assert in their answers and attempt to prove in their evidence there was no fraud, and although asserting this innocency, they claim negligence for not finding out what they say did not exist. But the law is that the office of trustee is an important one-an office of trust and confidence; one in which the weak and incompetent may find shelter and protection. It is the duty of the trustee to execute the trust, and it is not the duty of the cestui que trust to make any inquiries. Taylor v. Taylor, 8 How. 183, 200; Dresser v. Missouri & Iowa Railway Construction Co., 93 U. S. 92; Graffam v. Burgess, ubi sup.; Dorsey v. Packwood, 12 How. 126, 131; Villa v. Rodriguez, ubi sup.; Allore v. Jewell, 94 U. S. 506, 512; Zeller v. Eckert, 4 How. 288, 295.

It is sought to prove a consent by the cestuis que trustent to the purchaser by the trustees. But the alleged consent was not such a consent as the law contemplates. The cestuis que trustent were merely passive, and such an action is not consent, as expressly decided by the Supreme Court of Pennsylvania in the case of Paul v. Squibb, 12 Penn. St. 296. Confirma

Opinion of the Court.

tion must be a solemn and deliberate act, Lewin on Trusts, 450; no suggestio falsi, no suppressio veri: and not fished out from loose expressions. Carpenter v. Heriot, 1 Eden, 338.

No laches can be claimed by reason of the relationship between the parties: no acquiescence or ratification of illegal or unlawful acts, spelt out by the most equivocal and uncertain testimony of more equivocal and uncertain acts testified to. Kennedy v. Kennedy, 2 Alabama, 571; Boney v. Hollingsworth, 23 Alabama, 690; Sears v. Shafer, 2 Selden, (6 N. Y.) 268; Michoud v. Girod, ubi sup.; Brooks v. Martin, 2 Wall. 70.

The settlement in the orphans' court was no estoppel. That court had no jurisdiction over the distribution of equitable assets or real estate. Robertson v. Pickrell, 109 U. S. 608. The interest of John Hopkins in these squares was real estate.

Nor was the receipt of the distributive share allowed in the settlement an estoppel. Embry v. Palmer, 107 U. S. 3; Michoud v. Girod, ubi sup.

The plaintiff, Sarah E. Hopkins, being a married woman, no laches can be charged against her. House v. Mullen, 22 Wall. 42.

These sales being fraudulent, a court of equity will not allow the trustees or their heirs to reap any advantage from their scheme, but will set the sales aside ab initio, and hold them to an account for the profits which they have made - doing equity, however, to them, which they refused to others, in allowing them credit for their lawful expenditures, as improvements, taxes and payments to the appellees with interest thereon. Oliver v. Piatt, 3 How. 333, 401.

MR. CHIEF JUSTICE FULLER delivered the opinion of the court.

This bill was filed April 8, 1884, and attacked the purchases through Chapman at the sale of May 10, 1864, and the account stated and settled in the orphans' court March 28, 1865; the settlement made in 1873 of the proceeds of the sales of lots 3, 4 and 5 in square 67; and also the deed from William M. S. Hopkins and wife to John S. Hopkins of June 20, 1860. The

Opinion of the Court.

executors and trustees of John Hopkins; James Chapman, who purchased at the sale; Isaac and George Washington Hopkins, two of the sons and devisees of John Hopkins, and who were present at the sale, were all dead; the affidavits and vouchers filed in the orphans' court at the executors' settlement could not be found; partition had been had by judicial proceedings between one of the trustees and the heirs at law of the other, and also between the latter; and great changes had taken place in the quarter of the city where the lots and squares were located, coupled with an enormous increase in their value, in the lapse of twenty years, and because of the improvements which had in the meantime been made in their vicinity.

No rule of law is better settled than that a court of equity will not aid a party whose application is destitute of conscience, good faith and reasonable diligence, but will discourage stale demands, for the peace of society, by refusing to interfere where there have been gross laches in prosecuting rights, or where long acquiescence in the assertion of adverse rights has occurred. The rule is peculiarly applicable where the difficulty of doing entire justice arises through the death of the principal participants in the transactions complained of, or of the witness or witnesses, or by reason of the original transactions having become so obscured by time as to render the ascertainment of the exact facts impossible. Each case must necessarily be governed by its own circumstances, since, though the lapse of a few years may be sufficient to defeat the action in one case, a longer period may be held requisite in another, dependent upon the situation of the parties, the extent of their knowledge or means of information, great changes in values, the want of probable grounds for the imputation of intentional fraud, the destruction of specific testimony, the absence of any reasonable impediment or hindrance to the assertion of the alleged rights, and the like. Marsh v. Whitmore, 21 Wall. 178; Landsdale v. Smith, 106 U. S. 391; Norris v. Haggin, 136 U. S. 386; Mackall v. Casilear, 137 U. S. 556; Hanner v. Moulton, 138 U. S. 486.

The main contention here is that the sale of May 10, 1864, should be set aside as to the purchases by the trustees through

Opinion of the Court.

Chapman, on the ground of constructive, coupled with actual, fraud.

Undoubtedly the doctrine is established that a trustee cannot purchase or deal in the trust property for his own benefit or on his own behalf, directly or indirectly. But such a purchase is not absolutely void. It is only voidable, and as it may be confirmed by the parties interested, directly, so it may be by long acquiescence or the absence of an election to avoid the conveyance within a reasonable time after the facts come to the knowledge of the cestui que trust.

The often cited case of Michoud v. Girod, 4 How. 503, laid down the general rule that a person cannot purchase legally on his own account that which his duty or trust requires him to sell for another, nor purchase on account of another that which he sells on his own account, and that a purchase, per interpositam personam, by a trustee or agent of the particular property of which he has the sale, or in which he represents another, whether he has an interest in it or not, carries fraud on the face of it; but there was actual fraud in that case, and the rule that within what time a constructive trust will be barred must depend upon the circumstances was recognized. In Stearns v. Page, 7 How. 819, 829, Mr. Justice Grier, speaking for the court, said that a complainant, seeking the aid of a court of chancery under such circumstances of lapse of time as there existed, "must state in his bill distinctly the particular act of fraud, misrepresentation, or concealment must specify how, when, and in what manner it was perpetrated. The charges must be definite and reasonably certain, capable of proof,,and clearly proved. If a mistake is alleged, it must be stated with precision, and made apparent, so that the court may rectify it with a feeling of certainty that they are not committing another, and perhaps greater, mistake. And especially must there be distinct averments as to the time when the fraud, mistake, concealment or misrepresentation was discovered, and what the discovery is, so that the court may clearly see, whether, by the exercise of ordinary diligence, the discovery might not have been before made. Every case must, of course, depend on its own peculiar circumstances, and there

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