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8 T. R. Eq. 1.

Where an action is brought by the settlqr against the trustees to
set aside a voluntary settlement, it seems that the Court will not
consider the propriety of the insertion or the omission of clauses
except as evidence that the settlor did not understand what he was
doing, the only question being whether the settlor understood what
he was doing, and its effect on his position with regard to the pro-
perty {Button V. Thompson, 23 Ch. D. 278). But where the con-
test is not between the settlor and the trustees, but between the
settlor and persons claiming adversely to him, different considera-
tions apply, and it may be right to consider whether the clauses
were or not proper: Button v. Thompson, 23 Ch. D. 283, per Cotton
L. J.

It may be laid down, that even in the absence of any special re-
lation between the parties, where a person gains a great advantage
over another by a voluntary instrument, the burden of proof is un-
doubtedly thrown upon the person receiving the benefit, and he is
under the necessity of showing that the transaction Avas fair and
honest; for although the Court never prevents one person from be-
ing the voluntary object of the bounty of another, yet it must be
shown that the bounty was purely voluntary, and not produced by
any undue influence or misrepresentation (Hoghton v. Hoghton, 15
Beav. 299; Blackie v. Clark, 15 Beav. 600; Cooke v. Lamotte, 15
Beav. 243; distance v. Cunningham, 13 Beav. 363; Billage v.
Sothee, 9 Hare, 534; Allen v. Bavis, 4 De G. & Sm. 133; Price v.
Price, 1 De G. Mac. & G. 308; Phillips v. Mullings, 7 L. R. Ch"
App. 244); and also that the donor, especially when of weak mind,
fully understood the effect of the transaction, otherwise it will be
set aside (Anderson v. Elsivorth, 3 Giff. 154); even after the death
of the donor and donee: PhilUpson v. Kerry, 32 Beav. 628.

Where, moreover, a man induces a person of weak intellect and
improvident habits, to execute a settlement without independent
legal advice and without understanding it, or knowing the amount
of _ the property settled, or the effect of the settlement, it will be set
aside, even although the execution of the settlement was not pro-
cured by any unworthy motives, but with the object of protecting

43 WHITE ON EQUITY. — VOL. 2. 673



* 63G IIUGUENIN 7}. BASELEY.

the settlor against his owu improvidence: Button v. Thompson, 23
Ch. D. 278.

In judging of the validity of transactions between persons stand-
ing in a conlidential relation to each other, a material point
[ * 636 ] to be considered is whether the person ■^- conferring a l^ene-
fit on the other had competent and independent advice.
The age or capacity of the person conferring the benetit, and the
nature of the benetit, are of little importance in such cases; they
are important only when no such confidential relation exists: .Rhodes
V. Bate, 1 L. R. Ch. App. 252.

And it seems that where a confidential relation is established the
Court will presume its continuance, unless there is distinct evidence
of its termination: Rhodes v. Bate, 1 L. R. Ch. App. 252. [A sale
of stock by a stockholder to a director is not uithin the rale appli-
cable to confidential relations between parties in confident relations:
Carpenter v. Banforth, 52 Barb. 581; and see Weelt'. Winston, 115
U. S. 228; Watt's Appeal, 28 P. F. Smith, 392.]

But Avhero the relation has come to an end, and the donor has
during his life shown a determination to abide by his act, whether
he knew or not that he had power to retract his gift, his executor
after his decease will not be able to set it aside: Mitchell v. Horn-
fray, 8 Q. B. D. 587.

In the absence of any fiduciary relation, such as that of guardian
and ward, between the donor and donee, and also of any undue in-
fluence on the part of the latter, an infant may make a donation of
any chattels or personal property in his actual possession: Taylor
v. Johnston, 19 Ch. D. 603, 608.

Where one party has acquired undue influence over another by
operating on his fears, as for instance by threatening to bring rain
and disgrace upon his son by indicting loim for forgery, any agree-
ment executed by the father while under such influence jvill be set
aside with costs; and it seems that even the intervention of other
circumstances or collateral advantages to the father will not be suf-
ficient to sustain such an agreement: Bayley \. Williams, 4 Giff;
638, affirmed nom. Williams v. Bayley, 1 L. E. Ho. Lo. 200; and
see Davies v. London and Provincial Marine Insurance Comjoany,
8 Ch. D. 469; and see Evans v. Lleivellyn, 1 Cox. 333, 340.

But the principle upon which Williams v. Bayley was decided
has been held not to apply in the case of an agreement to compro-
mise a prosecution for misdemeanour; which might have been the
subject of a civil remedy: Fisher & Co. v. Apjwllinaris Co., 10 L.
R. Ch. App. 297.

An appointment made in exercise of a power by a wife in favour
of her husband will be considered good, unless the wife or other
persons impeaching the instrument show that it was executed un-
der circumstances sufficient to invalidate it, and the evidence of one
of the witnesses that the wife was agitated and distressed and sign-
fi74



HUGUENIN V. BASELEY. '- G37

ed the deed in a reluctant manner, has been held to be insufficient:
Neclbj/ V. Nedbij, 5 De G. & Sm. 377, 384.

Where a person executes a vohmtary deed in the ex-
pectation of his immediate death, but not * with the in- [ *637]
tention that it should be operative in case he recovers,
such deed will be set aside, even in the absence of undue influence,
if no power of revocation has been introduced into the deed: For-
shoiv V. Welsby, 30 Beav. 243.

But a voluntary settlement made by a settlor about to enter into
trade, of nearly the whole of his property, in favour of his wife
and family, and, with a view to their protection, will not in the ab-
sence of undue pressure be set aside, at the instance of the settlor,
especially if he comes long after the execution of the settlement,
and although there may be no power of revocation therein: Henry
V. Armstrong, 18 Ch. D. 668.

Although, as a general rule, if a voluntary deed does not express
the intention of the parties, it cannot be rectified so as to carry oufc
their intentions, and if it be impeached it must wholly starid or
wholly fall: Phillipson v. Kerry, 32 Beav. 628; Brown v. Kennedy,
33 Beav. 133. See ante, vol. I., p. 44; nevertheless, when the plain-
tiff agrees that the deed ought to stand, and takes objection only
to part thereof, the Court has jurisdiction to reform the deed, by
striking out such part as it it may deem objectionable: Turner y,
Collins, 7 L. R. Ch. App. 342. And in a recent case where a set-
•tlor's attention was not called to the fact that he might have had a
power of disposition over the property in default of issue, it was
held that the settlement which was voluntary ought to be rectified
by giving such a power to the settlor: James v. Couchman, 29 Ch.
D. 212.

III. Hoiv far the Court will interfere as against third part ies.l —
An inteiest obtained by undue influence, as Lord Eldon deeid'-^d in
the principal case, cannot be. held by third parties, althongh inno-
cent of fraud. "Whoever," to use the expressive language uf Chief
Justice Wilmot, "receives the gift, must take it tainted and infected
with the undue influence and imposition of the person procuring
the gift; his partitioning and cantoning it out amongst his relationa
and friends will not purify the gift and protect it against the equity
of the person imposed upon. Let the hand receiving it be ever so
chaste, yet, if it comes through a polluted cbaimel, the obligation
of restitution will follow it:" Bridgman v. Green, WiJm. 5S. 64;
S.C.,2 Ves. 627. And see Godard v. Carlisle, Price, 169; Scheie-
field V. Templer, Johns. 155; Smith v. Kay, 7 Ho. L. Ca. 750.

It is in effect clear that a person taking as a volunteer, property
obtained by undue influence, stands in the same position as the party
from whom he took, and he will be compelled to restore it to tho
party imposed upon: Bainbrigge \. Browne, 18 L. D. 197.

And where persons, having notice of the undue influence which

675



*639 IIUGUENIN V. BASELEY.

one party has power to exercise over another, combine with the
former party in order to obtain an advantage for themselves, the
transaction will be set aside. Thus, where a creditor obtains a
security from a person likely to be under the influence of
[ * 638 ] * his debtor, as, for instance, in the case of a son or younger
brother of the debtor's just come of age, the onus will lie
upon the creditor of showing that such person understood the trans-
action, and that he did not act under any undue influence, other-
wise the transaction will be set aside: Berdoe v. Dawson, 34 Beav.
608; Baker v. Bradley, 1 De G. Mac. & G. 597, 2 Sm. & G. 531;
Sercombe v. Sanders, 34 Beav. 382.

Upon the same principle in Maitland v. Irving, 15 Sim. 437,
Irving and Brown, who were partners as coal-merchants, consented
to postpone the payment of 5000/. due to them from Maclean, in
consideration of his • procuring and giving the guarantee of the
plaintiff, Miss Maitland, for that sum; and Maclean, at the same
time informed Irving and Brown that Miss Maitland was his niece,
and was possessed of considerable property; that she had resided
with him for some time, that he had been her guardian, and that
she had been of age about. a year and a half. Afterwards, another
arrangement was made between Irving and Brown and Maclean, in
pursuance of which Irving and Brown delivered up the guarantee,
and Maclean procured and gave them the plaintiff's cheque for
3000Z. and her promissory note for 1200Z., as securities for his pay-
ing them those sums. Sir L. Shadirell, V.-C, granted, and after-
wards continued, an injunction, restraining Irving and Brown from
prosecuting an action against the plaintiff to recover the 3000Z.;
and notwithstanding they had obtained a verdict, he refused to
order the money to be paid into Court. "The case," said his Honor,
"has been argued for the defendants as if it were a case in which
they had some ground to resist the rule in equity, because of their
not being volunteers. But no consideration whatever was given to
the young lady; on the contrary, she was induced to do the act upon
an application made to her by a person, who, if he had performed
his duty, would have advised her not to do that which he applied
to her to do. She was influenced by him, or, at least, allowed by
him, to give this very guarantee, which was a direct benefit to all
the defenders (Maclean was a defendant), in the situation in which
they then stood with respect to each other. The facts of the case
seem to me to amount to this: that Irving and Brown, knowing the
defenceless situation of the young lady, combined with Maclean,
who disclosed it to them, in order that advantage might be taken
of her defenceless situation, for the benefit of all the three. And
my opinion is, that they must all three be considered as standing
in the same situation. It is most necessary to consider the trans-.

action in this view, because it is the foundation of the
[*639] whole case; for, what subsequently *took place was

nothing more than a substitution of the note and the

670



UUGUENIN V. BASELEY. * 640

cheque for the guarantee." And see Maitland v. Backhouse, 16
Sim. 58; Archer v. Hudson, 7 Beav. 551; Es2Jey v. Lake, 10 Hare,
261; Dettmar v. Metropolitan and Provincial Bank (Limited), 1 H.
& M. Ml;' Rhodes v. Bate, 1 L. R. Eq. App. 252j IF. v. 5., 32
Beav. 574; ICempson v. Ashbee, 10 L. K. Ch. App. 15.

Where, moreover, a gift of property has been obtained by the.
exercise of undue influence, a purchaser for value subsequently
taking with notice of the equity thereby created, or with notice of
the cTrcumstances from which the Court confers the ^quity, will
be bound thereby: Bainbrigge v. Browne, 18 Ch. D. 197.

The principles, however, laid down in the cases before men-
tioned are not applicable to the case of a bona fide purchase with-,
out notice. Thus in Blackie v. Clark, 15 Beav. 595, a married
women having separate estate, joined with her trustee, who was her
confidential medical adviser, in granting annuities secured on her
separate estate for his benefit. Upon her filing a bill to set them,
aside as against the grantees, it was held by Sir J. Romilly, M.R.,
tbat the burden of proving their invalidity was on her, and as it
appeared that she understood the transaction, and that no undue
persuasion or coercion had been proved, the annuities could not be .
impeached; and his Honor, without absolutely determining that the
Court would not act in the same way in both cases, thought there
was a manifest difference between such a case and the cases of
Archer v. Hudson, and Maitland v. Irving, for the latter were
neither of them cases of a purchase for valuable consideration.
"They were cases," he added, "in which money had been already
lent, and the creditor finding his security very imperfect, obtained
from the volunteer, icho gained no benefit at all, a distinct and
manifest advantage. The same observations do not apply to the
case of a bona fide purchase, in the first instance, for valuable con-
sideration, because, if the purchase be a fair one, the purchaser
gains no advantage, for he would simply abstain from purchasing
if the volunteer did not think fit to join in the transaction." See
also Bainbrigge v. Broivne, 18 Ch. D'. 188.

In Corbett v. Brock, 20 Beav. 524, a debtor induced a lady, to
whom he was engaged to be married, to become security for a debt
After the marriage she insisted that she had been imposed upon.
It was held by Sir John Romilly, M.R., that the only duty of a
creditor (who was aware of the relation between the parties)
towards the lady was to see that she had proper professional assist-
ance, and that any fraud or misrepresentation of the debtor
the transaction, of which the creditQr had no * notice, did [ * 640 ]
not affect his security. " I fully adhere," said his Honor,
" to what I expressed in the cases of Cooke v. Lamotte (15 Beav.
284), and Hoghton v. Hoghton (15 Beav. 278), and if this were a
case between the husband and wife I should require him to prove
all the requisites I pointed out in those cases as necessary to give
validity to the transaction; but when the security gets into the

677



* 641 HUGUENIN V. BASELEY.

hands of a purchaser for valuable consideration, the case is very-
different, unless the person obtaining the benefit of it has been
guilty of, or pri 'y to, the fraud. The fact of the intended husband
saying, ' I am about to marry a lady who will give you security,'
does not amount to notice to them that this security could only be
obtained by undue influence."

And it seems that although a deed may be valid in respect to
purchases without notice of undue influence, as for instance, that of
the father over his child as plaintiff in an action, it may at the
same time be declared that so far as the father is concerned the
deed is not binding in any way on the plaintiff : Bainbrigge v.
Broioiie, 18 Ch. D. 188, 199.

It will be observed that in the principal case, the solicitor who
prepared the deeds which were set aside as obtained by undue in-
fluence having been made a party to the suit, Lord Eldon observed
that it deserved serious consideration "whether he should not pay
the costs if the other defendant could not." This observation of
Lord Eldoii's was acted upon by Sir J2. il/aZms, V.-C, in the recent
case of Baker v. Loader, 16 L. R. Eq. 49. See also Beadles v.
Burcli, 10 Sim. 332; Harvey v. Mount, 8 Beav. 439. Sed vide Clark
v. Girdwood, 7 Ch. D. 9.

As to acquiescence and confirmation, see Wright \. Vanderplank,
2 K. & J. 1 ; 8 De G. Mac. & G. 133 ; Stump v. Gaby, 2 De G. Mac &
G. 623; Wallasfon v. Tribe, 9 L. R Eq. 44; Jarratt v. Aldam, 9 L.
R. Eq. 463; Turner v. Collins, 7 L. E. Ch. App. 342; Moxon v.
Payne, 8 L. R. Ch. App. 88; Kempson v. Asbee, 10 L. R. Ch. App.
15; Mitchell v. Homfray, 8 Q. B. D. 587; and ante, vol. i. pp.
211—214.

IV. As to gifts by unll.'\ — The rules of equity in relation to gifts
inter vivos, by which fraud is presumed when they are obtained
from persons standing in certain relations to the donors, have
been held not applicable to gifts by wills. See Parfitt v. Lawless,
2 L. R. P. Si D. 462: Aslnvell v. Lomi, 2 L. R. P. & D. 477.

It has also been held that an attorney, although he himself has

prepared it, may take a gift under the %inll of a client, for his own

benefit as devisee or legatee, if the will was not made under any

mistake or misapprehension caused bv the attorney: Hind-

[ *041 ] Sony. Weather ill, 5De G. Mac. & G. 301; reversing *,S. C,

1 S. & Giff. 604; Walker v. Smith, 29 Beav. 394.

Formerly it seems to have been supposed to be an unyielding
rule of law (especially where the ingredient of fraud enters into the
case) that where it has been proved that a testator, competent in
mind, has had a will read over to him, and has thereupon executed
it, all further inquiry is shut out. This rule has been disapproved
of by the House of Lords in the important case of Fulton v. Andreiv,
7 L. R. Ho. Lo. 449, [It is now thoroughly settled that equity has
no jurisdiction in cases of firaud used in obtaining a will: Adams v.
678



i



HUGUENIN V. BASELEY. * 641

Adams, 22 Vt. 50; Hunt v. Hamilton, 9 Dana, 90; Trexler v. Miller.
6 lad. 248; Ewell v. Tidwell, 20 Ark. 130.]. where it was decided
that those who take a benefit under a will, and have been instru-
msutal in preparing or obtaining it, have thrown upon them the
that any person propounding a will prepared by himself without
V. Butliii, 2 Moo. P. C. 480, 482; Baker v. Batt, 2 Moo. P. O. 317.

In the recent case of Hegarty v. King, 7 L. K. Ii-. 18, it was held
•onus of shewing the righteousness of the transaction. See also Barry
assistance of a third person, and under which he takes a benetil,
is bound to give clear and convincing evidence that the testator
knew and approved of the clause under which he took a benefit, and
that this principle applied even in the case of a near relative of the
testator, and in the absence of such evidence, probate of that portion
of the will may be refused, and granted of the remainder.

There does not seem to be any sound reason why the rules of
equity, as to the presumption of undue influence should not be ap-
plicable to wills, precisely in the same manner as in the case of deeds,
and if they are not made so by sect. 25, sub-sect. 11, of the Judica-
ture Act, 1873 (36 & 37 Vict. c. 66), there is certainly still room for
further legislation upon a very important subject.

[^Doctrine of Gifts or Contracts Obtained by undue Inftiience Re-
stated. — The same principle which vitiates a contract with an in-
capacitated person is extended in equity to avoid benefits obtained
by trustees from their cestuis que trustent, or by other persons sus-
taining a fiduciary character from those in I'egard to whom that
character exists.

This rule is constantly acted upon in the United States. It is
applied to executors, administrators, guardians, assignees in bank-
ruptry, attorney, trustees, and in general to all j^ersons standing in
any fiduciary position. And where even any person stands in rela-
tion of special confidence towards another, so as to acquire an habitual
influence over him, he cannot accept from hira a personal benefit
without exposing himself to the risk, proportioned in a degree to
the nature of their connection, of having it set aside as unduly ob-
tained.

Equity not only views gifts and contracts which are made or take
place between parties occupying a confidential, with a jealous eve,
but it goes further and forbids any person standing in a fiduciary
position, from making any profit in any way at the expense of the
party whose interest he is bound to protect, without the fullest and
most complete disclosure.]



679



* 643 EARL OF oxford's CASE.



[*642] -^EARL OF OXFOED'S CASE.



13 Jac. 1.

[reported 1 CH. EEP. 1. (a)

Jurisdiction of Equity as to Proceedings at Law.] — Principles on
which equity restrains proceedings under a judgment obtained
at laiv.

Magdalen College, 39 Hen. 8, seised in fee of the Rectory of Christ's
Church, and the Covent Garden, without Aldgate, London, contain-
ing seven acres, demised them for seventy-two years rendering 40Z.
per annum for the rectory, and ^l. for the garden. And 17 Eliz.
(fifty years of the said lease being expired), the Queen, at the suit
of the said College, licensed them to alien, which they did, and then
received for the rectory 25Z. per annum, and lol. for the garden. It
being her Majesty's intent that the College should be advanced
greatly in profit, by having the Rectory to them and their successors,
discharged of the lease for years, which in present was worth to
them but 50Z. per annum, the utmost rent; the same was accord-
ingly performed by a conveyance to her Majesty, and by her Ma-
jesty to Spiuola and the Rectory, from Spinola to the College; after
which, Spinola and the Earl of Oxford, his assignee, and his under
tenants have built upon the Garden one hundred and thirty houses,
and therein bestowed 10,000?., which assignee and his undertenants
have bonds and security given for the enjoyment thereof, to the
sum of 20,000?.

Note. — The College is hereby advanced 1700Z. more than they
should have been if the former lease had continued, which is not yet
expired.

This conveyance having been in peace forty years, and thus

advanced by the purchasers from a thing of little

[*643] * value to a great and considerable one; and it being a

(a) S. a, Toth. 126 (edit. 1823), nom. Comes Oxon v. Neeth.

680



EARL OF oxford's CASE. '" 644

general case wherein persons of ail degrees and callings have made
purchases, they resting secure on its passing through the Crown,
the greatest protection.

The present Master of the College having by undue means ob-
tained possession of one of the one hundred and thirty houses,
whereof one Castillion was lessee, who being secure of his title, both
in law and equity, sealed a lease thereof for three years to one
Warren, who thereupon brought an ejectment against one John
Smith, for trial of the title in B. R. Wherein a special verdict was
had; and while that depended in argument the lease ended, and so
no possession could be awarded for the plaintiff, nor fruit had of
his suit.

Yet he proceeded to have the opinion of the Judges to know the
law (which was a voluntary act of his), to the intent, if the law were
with him, he might begin a new suit at law, and spare to proceed in
equity, and if the law were against him, that then he might proceed
in Chancery. And the Judges of that Court having delivered their
opinions against his title, before any judgment entered upon the
roll, the Earl and Mr. Wood, for themselves and their lessees, pre-
ferred their bill in Chancery; and then judgment was entered,
quod querens nil capiat per billam (a).

To which bill in Chancery the defendant put in a i^lea and de-
murrer, alleging the conveyance to be void by the statute of 13
Eliz., and that they evicted one house, parcel of the premises, by
judgment at law; which plea and demurrer were referred by order
* to Sir John Tyndal and Mr. Woolridge, who reported that they
thought it fit the cause should proceed to hearing, notwithstanding
the plea and demurrer; and afterwards, in default of an answer, an
attachment was awarded against the defendants, whereupon they
were attached, and a cepi corpus returned, and by order of the 22nd
of October, 13 Jac. 1, they were coaimitted to the Fleet for their
contempts in refusing to answer; and do now stand bound over to
answer their contempts, they still refusing to answer.

* And now this term it was argued, that the defendants [ * 644 ]
thus standing in contempt, &c., may be sequestered Until
answer.

Lord Chancellor Ellesmere. — 1. The law of God speaks for the
plaintiff, Deut. xxviii.

(a) See Magdalen College Case, 11 Co. 66.

681



* 645 EARL OF oxford's CASE.

2. And equity and good conscience speak wholly for him.

3. Nor does the law of the land speak against him. Bat that
and equity ought to join hand in hand in moderating and restrain-
ing all extremities and hardships.

By the law of God, he that builds a house ought to dwell in it;
aad he that plants a vineyard ought to gather the grapes thereof;



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