C.A.

1900-1. BROWN

V.

BROWN.

Powell(1).

They are liable for fraudulent collusion: Kaye v.
They were bound to see that the plaintiff's interests were not
sacrificed. They not only permitted the state of things to
exist, they did the acts which actually deprived the plaintiff.
Where trustees have notice of circumstances from which the
Court will infer undue influence, and thereafter join in and
effect the gift, they are responsible for the consequences.
The trustees and Crisp were aware of all the facts from
which the dominion of the defendant Brown over his mother
will be inferred. They were also aware that she had no inde-
pendent advice, and that her son was present when the trans-
action took place: Bainbrigge v. Browne (2); De Witte v. Addi-
son(3). Their liability is analogous to the liability of trustees
to replace a fund which they have handed over in pursuance
of an appointment which, to their knowledge, has been made
in fraud of the power: Mackechnie v. Marjoribanks(4); Harri-
son v. Randall(5); Farwell on Powers (6). A solicitor is at
least liable to pay costs where he upholds an improper trans-
action: Kerr on Frauds(7). As to what is fraud, to take a
breach of trust out of the limitation provided by "The
Trustee Act, 1891": Darby and Bosanquet on Statutes of
Limitations(8); Moxon v. Payne(9).

Harper, for the defendant Brown:

The presumption of undue influence in the case of a gift from a child to a parent does not exist where the gift is from parent to child: Pollock on Contracts(10); May on Fraudulent Dispositions of Property(11); Garrett v. Wilkinson(12). In such a case the onus is on the side of the party wishing to impeach the gift to show actual undue influence: Beanland v. Bradley(13); May v. May(14); Cowee v. Cornell(15). The onus of supporting a voluntary deed does

(1) 1 Ves. Jun. 408.

(2) 18 Ch.D. 188.

(3) 80 L.T. 207.

(4) 39 L.J. Ch. 604.

(5) 9 Hare, 397, 407.
(6) 2nd ed. 414.
(7) 2nd ed. 443, 444.
(8) 2nd ed. 261.

(9) L.R. 8 Ch. 881, 887. (10) 6th ed. 590.

(11) 2nd ed. 491.

(12) 2 DeG. & Sm. 244.

(13) 2 Sm. & G. 339, 342.
(14) 33 Beav. 81, 87.

(15) 31 Amer. Rep. 428, 434.

not necessarily rest on those who set it up: Henry v. Arm-
strong(1). In the absence of any of the well-known special
relations the onus lies on the person impeaching the trans-
action: Pollock on Contracts(2); Whalley v. Whalley(3).
The plaintiff, though illiterate in one sense, was an intelli-
gent person, and not liable to misunderstand what was going
on. The transaction of 1894 was nothing more than a gift
which a mother might rightly make to her son. This is an
ordinary voluntary gift, and to impeach it active undue in-
fluence must be proved: May on Fraudulent Dispositions of
Property(4); Toker v. Toker(5); Archer v. Hudson (6); All-
card v. Skinner(7); Cooke v. Lamotte(8). There is no abso-
lute rule that father and child should have different soli-
citors: Bainbrigge v. Browne(9). That there was no power of
revocation does not affect the matter: Hall v. Hall(10); Dut-
ton v. Thompson (11). The dictum of Farwell, J., in Powell
v. Powell(12) goes too far.
no protection unless it were
by Barron v. Willis(13).
proved by the evidence. The plaintiff thoroughly understood
what she was doing, and did it voluntarily. She had com-
petent advice, though not independent. She could not get
equally competent advice in a small place like Ashburton.
There is no evidence of any scheming on the part of the
defendant Brown.

The independent advice would be
acted upon. It is not supported

Actual undue influence is not

Wilding, for the other defendants;

The trustees were bound to hand over the trust property when asked by the beneficiary. The transaction was necessary to save the property. If they had refused, the home would have been broken up by a sale by the first mortgagees. If the trustees had refused to discharge the mortgage, and the plaintiff had sued them to compel them to do so, they would have

C.A.

1900-1.

BROWN

v.

BROWN.

C.A. 1900-1.

BROWN

v.

BROWN.

been liable to pay costs: Godefroi on Trusts(1); Lewin on Trusts(2); Jones v. Lewis(3); Goodson v. Ellisson(4). The trustees were mere depositaries of the plaintiff's mortgage, and could have been compelled to transfer to her at any time. They were bound, therefore, to deal with it as she directed. As to the solicitor's liability to pay costs where he is joined as defendant: Morgan and Wurtzburg's Law of Costs(5); Burstall v. Beyfus(6); Barnes v. Addy(7); Mathias v. Yetts(8).

.

Joynt in reply.

STOUT, C.J.:

Cur. adv. vult.

John Brown, a farmer in Wakanui, Ashburton, was the owner of two-thirds of a farm-viz., of Section 14706, containing 296 acres, and Section 4921, containing 20 acres. He and his sons had bought the 296 acres early in 1876 for' £2,812. The other section was valued in 1885, at the time of his death, at £9 per acre (£180). The owner of the remaining third of the farm was his son George Brown. His son Samuel Brown had been the owner of a third, but he had sold his third in 1882 to his father. The 296 acres were mortgaged to Thomas Benent to secure £1,000, and the 20 acres to the Union Bank to secure £136 1s. 8d. On the 23rd of September, 1885, John Brown died. At the time of his death he had two-thirds of the farm, subject to the encumbrances mentioned, and the 296 acres were also mortgaged as collateral security to secure £1,500 due by his son Samuel to Leonard Harper and Thomas William Maude. The £1,500 was secured on 20 acres, Section 7187, and on 130 acres, Section 7796, that belonged to Samuel. He left a will by which he appointed the two defendants David Thomas and Joseph Sealey trustees and executors, and bequeathed his personal property to his wife, the plaintiff, and devised his real property to the trustees in trust for his wife and his son Samuel in equal shares. His other children besides Samuel were settled in life or had land. Samuel had only the 150 acres mortgaged to Harper and

(1) 2nd ed. 469.
(2) 10th ed. 836.

(3) 1 Cox, 199.

(4) 3 Russ. 583.

(5) 2nd ed. 385, 386.

(6) 53 L.J. Ch. 565.

(7) L.R. 9 Ch. 244, 255, 256.

(8) 46 L.T. 497, 502.

Maude, and he had originally held one-third of the 296 acres. I presume he meant to restore to Samuel this third he originally possessed, and to give to his wife sufficient to maintain her during life, leaving her to dispose of the property as she should think fit.

It was attempted by the trustees and by Samuel Brown to set up that only one-third of the farm belonged to the testator. That seems to be an afterthought, and it does not appear very creditable to the trustees to have pleaded it. The trustees both made a statutory declaration on the 28th of November, 1885, that the testator was possessed of two-thirds of the land at his death, and again made another declaration to the same. effect on the 28th of July, 1887. Further, Samuel Brown carried out transactions with the trustees on the footing that his father was, at his death, entitled to two-thirds of the farm. And on the 20th of November, 1885, Samuel Brown made a statutory declaration that his father was owner of the twothirds, for he declared that the 14th schedule of the accounts was correct. Either the trustees and Samuel Brown made false declarations in 1885, or their theory now is untrue. position, according to the accounts, was that the deceased's real and personal estate was valued, deducting mortgages and debts, at £1,120 10s., or £1,114 real estate and £6 10s. personal estate.

The

For about two years nothing was done. It is said some wheat had been shipped to England. in 1885, and money drawn against it; but in this respect, and as regards the true indebtedness, no information has been given to the Court. The trustees seem to have taken no means or trouble to ascertain how it stood. They produced no accounts, and they did not call the manager of the bank or other evidence to show what the real state of the accounts was. The whole question of the position of wheat-shipments and accounts has been left uncleared-up. The only detail given of accounts is that £100 was spent in funeral expenses and a tombstone, that the probate cost £24 6s. 4d., and that there was a debt to the bank of £140.

In 1887 Samuel Brown was in financial difficulties, and he

C.A. 1900-1.

BROWN

v.

BROWN.

C.A. 1900-1.

BROWN

V.

BROWN.

wanted to raise more money on his land.. A flood had injured the land left by the testator, and it was difficult to obtain any loan on the land. The trustees were afraid that the land would be more injured by floods, and that if some fresh mortgage arrangements were not made the mortgagees would sell, and the home would be lost to Samuel Brown. Mr. Thomas says, "There was great trouble in raising money, and Sam was on the merest chance of being thrust out of the farm. I I tried to obtain money for him. He tried himself, and was prepared to pay any rate of interest, but owing to the encroachment of the river no money-lender would tackle it, "nor could it have been sold." The trustees then arranged

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to transfer the whole of the real estate that belonged to the testator to Samuel Brown. The suggestion of danger did not come from the plaintiff. That is not alleged. Samuel Brown says, I remember trustees transferring to me. It was done through me to raise the money. I went to Ashburton about "it. Mother knew that I was having the land transferred to me. She knew all about it. She understood everything thoroughly. I believe it was necessary to save the property to transfer the land to me, and raise the money in this way. "At that time we talked over the matter of mother's interest." Mr. Sealey says, "I remember loan by Stark in 1887. I 66 was familiar with all that went on. We divested ourselves "of two-thirds and handed it to Sam. If we had not done "that for the purpose of raising money the home would have

66

undoubtedly been broken up." Dealing, then, with this transaction, in 1887 we have the trustees doing what the will did not allow them to do, and committing a breach of trust. They say they did it to save the farm from the mortgagees. The plaintiff was then sixty-nine years of age, was illiterate, and had no advice of any sort. She was living with her son, and was under his influence. She is said to have been a shrewd woman; but it is not proved that all the financial complications of mortgages were understood by her.

No

The question here arises, were the trustees guilty of fraud in thus parting with her property to Samuel Brown? consideration passed. The consideration mentioned in the