(107 A.) was accepted, a contract executed by the parties, a decree authorizing the sale issued by the probate court, and a conveyance ultimately made. This sale the plaintiffs seek to have set aside. The offer, counter offer, and final offer purported to be based on the appraisal. The plaintiffs claimed they were induced to make the sale for the sum finally agreed upon by the fraudulent representations of the defendant to the effect that the business was running down, and that there were no profits. It is found that the defendant desired to purchase the Cotton interest for the lowest possible figure, and treated his sister on a strictly business basis. In all his dealings with her there was a lamentable absence of brotherly regard. She knew this, and knew he was not treating her frankly and fairly. His policy for the most part seems to have been one of silence rather than assertion, and was pursued with ulterior designs. Mrs. Cotton before the settlement expressed her conviction that the appraisers were influenced by the defendant. The court found that the plaintiffs were not misled by any of the defendant's alleged misrepresentations, and ordered the bill dismissed. To this order the plaintiffs excepted. After the case was submitted, the plaintiffs moved for a further hearing upon the ground that they had discovered new evidence which would show that the defendant had stated in writing that he allowed the appraisers to make a very low appraisal, which was 40 per cent. below the true value, and that he did this because he wished to buy the interest of the estate. Subsequently the plaintiffs filed another motion for a further hearing upon substantially the same ground. The court denied both motions as immaterial, and the plaintiffs excepted. The plaintiffs' bill of exceptions was allowed. Albert Terrien, Doyle & Lucier, Charles J. Hamblett, and A. J. Lucier, all of Nashua, for plaintiffs. Charles W. Hoitt, of Nashua, and Streeter, Demond, Woodworth & Sulloway, of Concord, and Fred C. Demond, of Concord, for defendant. WALKER, J. [1, 2] The court's order dismissing the bill was in part based upon the finding that the executrix was not deceived in making the compromise agreement by the representations of the defendant that the firm business had not been prosperous since the death of Mr. Cotton. The fact that Mrs. Cotton did not have entire confidence in the defendant and believed he would not treat her fairly 'n settling the firm affairs, and the fact that she employed counsel to assist her in that respect, were deemed to be important evidence in support of the conclusion that she was not in fact deceived by the alleged fraudulent representations or concealments of the defendant. Her lack of confidence in him acting as a trustee did not relieve him from the performance of the duties of a trustee, one of which is entire good faith and honesty; nor did it leave them in the position of independent parties having no special fiduciary rights and obligations. His representations as to the character of the business were material, and, if he knew they were false, constituted a breach of the trust assumed by him as surviving partner. He is not entitled to enrich himself from the trust property, because she did not trust him. It was incumbent on him to make a full and fair disclosure of the value of the firm property; if he did not and in conse-. quence he obtained more than his share of the property, it is plainly inequitable that he should retain what he was not entitled to upon the ground that she was not deceived by his representations or did not believe what he said. She did not discharge him as her trustee. See cases hereinafter cited. After the case was submitted the plaintiffs moved for a further hearing upon the ground that new evidence had been discovered which would show that the defendant knew at the time of the settlement that the appraisal of the property, in view of which the settlement was made, was 40 per cent. less than the true value. This fact was not disclosed by him to the executrix; nor does it appear that he made any direct representation to her as to the value of the property. The court declined to receive the proffered evidence upon the ground that it is immaterial, since Mrs. Cotton did not rely on the misrepresentations of the defendant, and was not deceived thereby. [3] In this situation the question is whether the fact that the defendant knew the inventory greatly undervalued the property is a material fact to be considered in this case. It is to be noted that there is no finding that before the settlement was made the execu trix had released the defendant from any of his duties or obligations to her as a surviving partner. As she was acting in her ca pacity as executrix of her husband's estate and was therefore a trustee herself, her authority to waive his performance of his duties as a trustee is questionable. If she did not rely on what he said in regard to the partnership affairs, and if the effect of her disposition in this respect might preclude her from insisting that she was misled by his false statement of material facts, it did not justify him in willfully concealing from her matters of great importance to a fair and just compromise. Even if she was not misled by his previous misstatements of facts relating to the firm business, it does not follow that she was not misled by the inventory which, as the defendant knew, was far below the true value of the property, and which, [self. Having generally a superior knowledge presumably, he also knew she regarded as a tentative basis of the compromise. The finding that the final offer "purported to be based" on the inventory is inconsistent with the theory, now insisted upon by the defendant, that she was not misled or deceived by the unfair appraisal contained in the inventory. It is difficult to understand why the evidence of the undervaluation and the defendant's failure to disclose to her the fact as he believed it to be was not material on the issue of fraud in fact, or upon the issue of constructive fraud arising from the trust relations of the parties. of the assets and their value, it is his bounden duty, in purchasing the interest of the deceased partner, to acquaint his representative with full information as to the assets, and the facts from which their value may be estimated or inferred. It is not sufficient that he does not withhold or conceal such information, but it is incumbent on him to disclose voluntarily all within his possession or knowledge from which a sound judgment as to the value of the interest may be formed. He cannot remain passive, but must make a frank and honest disclosure." In Farnam v. Brooks, 9 Pick. (Mass.) 212, [4] That a surviving partner is a trustee it was held that trustees in bargains with and the personal representative of the de- the owner relating to the trust fund are obceased partner a cestui que trust, with refer- liged, not only not to misrepresent and not to ence to the partnership property, is a well- conceal, but also to disclose everything established principle in equity jurisprudence. known to them, which in the mind of a pruPars. Part. § 345; 3 Pom. Eq. Jur. (4th Ed.) dent man would be likely to affect the bar§ 1088. It is also universally held that again; and if this is not done, though there trustee is bound to show upon a settlement may be no design to cheat, yet there is a or accounting with the beneficiary that he constructive fraud. The cases of Pearson has managed the trust for the benefit of the v. Railroad, 62 N. H. 537, 13 Am. St. Rep. latter, and to make a full and fair disclosure 590; Lovett v. Morey, 66 N. H. 273, 20 Atl. of all facts within his knowledge, or which | 283, and Sparhawk v. Allen, 21 N. H. 9, suphe ought as a prudent man to know, which port this view. See, also, 1 Perry, Trusts, are material to a full and adequate under- § 195; 2 Pom. Eq. Juris. § 956; 1 Beach, standing by the beneficiary of the condition Trusts, § 196; Ludington v. Patton, 111 Wis. of the trust estate. In some cases it has 208, 239, 86 N. W. 571; Welbourn v. Kleinle, been held that a trustee could not purchase 92 Md. 114, 128, 48 Atl. 81; Byrne v. Jones, the trust property, but in Perry, Trusts, 159 Fed. 321, 323, 90 C. C. A. 101; Brown v. § 428, it is said: Cowell, 116 Mass. 461, 465; Heath v. Waters, 40 Mich. 465. [5] The fact that the defendant failed in his duty to the executrix in not disclosing to her the fair value of the firm property as he understood it is made more convincing by the finding that he dealt with her on a "strictly business basis," that he pursued a "The better opinion, however, is that a trustee may purchase of the cestui que trust, or accept a benefit from him, but the transaction must be beyond suspicion; and the burden is on the trustee to vindicate the bargain or gift from any shadow of suspicion, and to show that it was perfectly fair and reasonable in every respect, and courts will scrutinize the transac-policy of silence rather than assertion, havtion with great severity." See 2 Beach, Trusts, § 697. In the case of a settlement between a trustee and the beneficiary by which the latter attempted to release and discharge the former without an accounting, in consideration of his agreement to support her during the remainder of her life, the court in Re Hodges Estate, 63 Vt. 661, 666, 22 Atl. 725, 727, say: "It is only when it is made to appear to the entire satisfaction of the court that the beneficiary had full knowledge of all the facts bearing upon the settlement, and acted therein advisedly and without undue influence, that a contract of this character between trustee and beneficiary will be sustained." This principle of equity is well stated in Tennant v. Dunlop, 97 Va. 234, 244, 33 S. E. 620, 623, where it is said that the surviving partner “cannot place the representative of the deceased partner at arm's length, and ing ulterior designs, and desired to purchase the property at the lowest possible figure. He was influenced by purely selfish motives, which it is the policy of the equitable principles above stated to prevent in cases of trusts. Whatever effect his positive assertions may have had upon his sister's mind, it cannot be doubted that his nondisclosure of the fact that the inventory was much too low was a clear breach of trust. If he had made the requisite disclosure it could not be said that as a prudent woman she would not have believed it and would not have been influenced by it in deciding upon the value of her interest in the firm. She was not influenced by it because he failed to inform her of it. It is said that she thought the appraisers undervalued the property. But it does not appear that she had any definite idea upon that subject. She certainly did not have the very definite knowledge, possessed by him, that the appraisal was some 40 per cent. too low. The inference is (107 A.) she would not have settled for the sum she | not understand and appreciate the effect of received. He allowed her to act under a mis- what he did when he signed the deed, it could apprehension of the value of the property, be found that it was procured by undue inwhen it was his manifest duty to protect fluence, or that it was the defendant's mind her from such an error of judgment. His which dominated the making of the deed. nondisclosure resulted in a settlement which Edgerly v. Edgerly, 73 N. H. 407, 62 Atl. 716. was greatly to his advantage and equally The question, therefore, of whether the court disadvantageous to her. This conclusion is erred resolves itself into the question of based upon the assumption that the evi- whether there is any evidence tending to dence, if received, would prove the facts al- prove that the grantor's mind was so far leged in the motion. The evidence, there- gone, at that time, that he was incapable of fore, was material, and should have been re-transacting ordinary business. The evidence ceived. The fact that she employed counsel to assist her in the negotiations, who so far as appears was not informed of the undervaluation of the appraisers, is unimportant; it does not relieve the defendant from the duty of disclosing the truth. Exceptions sustained; new trial granted. (79 N. H. 524) PEVEAR et al. v. PEVEAR. relevant to that issue tended to prove that the grantor had been failing physically and mentally for several years, and that his mind was so far gone a month or more before the deed was made that he could not carry on connected conversation or comprehend what was said to him in respect to matters with which he had been perfectly familiar. In other words, the evidence warranted a finding that the grantor had so far lost his mind as to render him incapable of transacting any business; consequently there was evidence for the jury on both issues. Dennett v. Den (Supreme Court of New Hampshire. Rocking- nett, 44 N. H. 531, 537, 538, 84 Am. Dec. 97. ham. April 1, 1919.) In suit to cancel a deed, evidence that the grantee took the grantor to the scriveners and did most of the talking, that the grantor was failing physically and mentally, and was unable to transact ordinary business, etc., held to make grantor's mental capacity and grantee's exertion of undue influence jury questions. Transferred from Superior Court, Rockingham County; Allen, Judge. Bill by Morris B. Pevear and others against Lydia M. T. Pevear. Trial by jury. Verdict for plaintiffs, and to a denial of her motion for a directed verdict, defendant excepts. Exceptions overruled. Two issues were submitted to the jury: (1) Was the grantor of sound mind; and (2) was the deed procured by undue influence. Transferred from the May term superior court. Scammon & Gardner, of Exeter, for plain tiffs. Sleeper & Brown, of Exeter, for defendant. Defendant's exception overruled. (79 N. H. 213) SCAMMON et al. v. PEARSON. (Supreme Court of New Hampshire. Rockingham. May 6, 1919.) 1. JUDGMENT 475-COLLATERAL ATTACKPROBATE COURTS. Decrees of the probate court regularly made are not subject to collateral attack, and can be reopened only by the court of probate. 2. TRUSTS 161-TRUSTEES-BONDS. A trustee cannot take an estate under a will until he has given the bond required by Pub. St. 1901, c. 198, § 1. 3. TRUSTS 161-BONDS. Until a trustee under a will has qualified by giving the bond required by Pub. St. 1901, c. 198, § 1, it is the duty of the executor to hold the estate in that capacity, and where the executor and the trustee are the same person, he continues to hold the property as an executor. 4. WILLS 697(3) — CONSTRUCTION - RIGHT OF ACTION BY EXECUTOR'S PERSONAL REPRESENTATIVE. Where an executor holding property in trust the will by giving bond as required by Pub. St. as such dies before qualifying as trustee under 1901, c. 198, § 1, the trust relation is terminated and does not pass to his personal representative, and the latter cannot maintain a bill for advice as to distribution, where the executor's successor objects. YOUNG, J. Two questions are raised by the defendant's exception whether there is any evidence tending to prove-not whether it is more probable than otherwise that (1) the grantor was of sound mind when he executed the deed in question; and (2) whether the deed was procured by undue influence. There was evidence that the defendant took the grantor to the scriveners, was present when the deed was made, and did most of the talking. If, therefore, there was any evidence from which it could be found that the The ground on which a trustee under a will grantor's mind was so far gone that he could is permitted to maintain a bill for advice is 5. WILLS 697(3)-BILL FOR ADVICE BY TRUSTEE. For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes that otherwise he must act at his peril, or else the probate court. There is no suggestion wait until a claimant brings suit. that the decrees were not regularly made, 6. COURTS 200-JURISDICTION OF SUPERIOR and by well-established law they are not COURT-PROBATE MATTER. Superior court has not jurisdiction in action by an executor, whose testator at the time of his death was an executor holding property in trust, so far as it involves charging or discharging the executor on account of his testator's official acts; such acts not having been passed on by the probate court. 7. WILLS 695-BILL FOR ADVICE. An executor who makes claim to property upon the ground that his decedent had an interest under the will of another is not entitled to the advice of the court as to the validity of such claim, as he can proceed directly for the recovery of his claim. subject to collateral attack. If for any reason they ought to be reopened, so that the proceedings leading up to them can be reviewed, the desired relief can be had only in some direct proceeding. They can be reopened only by a court of probate, and proceedings looking to that end must be begun by an appropriate motion or petition addressed to the judge of probate. Reed v. Prescott, 70 N. H. 88, 46 Atl. 457, and cases cited; Barrett v. Cady, 78 N. H. 60, 64, 96 Atl. 325. The bill further seeks for an advisory opinion as to whether certain property of Elizabeth Jacques should be treated as inThe defendant ob Transferred from Superior Court, Rock- come or as principal. ingham County; Allen, Judge. Bill by John Scammon and another, executors of the will of William H. Jaques, against Edward N. Pearson, administrator d. b. n. c. t. a. of the estate of Elizabeth H. Jacques. Transferred on plaintiffs' exception to the action of the court in sustaining defendant's demurrer to the bill. Exception overruled. Bill in equity, alleging that the plaintiffs' testator, who was one of the executors of the will of his wife, Elizabeth H. Jacques, filed and settled an account of said trust in the probate court in 1906, and another in 1916; that the 1916 account was reopened in 1917, after his death, and a modified decree was made, from which the plaintiffs appealed, and which appeal is now pending. It is further alleged that both of said accounts are erroneous and should be corrected, and that certain distributions of stock and bonds to the estate should be treated as income. The prayer of the bill is: "That all of said accounts and all the accounts of the executors of the will of Elizabeth H. Jacques may be re-examined. That all the mistakes therein may be corrected. That it may be determined what cash and securities as income said Jacques in his lifetime failed to receive. That a general accounting be had," and for other relief. In the superior court, Allen, J., sustained the defendant's demurrer to the bill and transferred the case on the plaintiffs' exception from the May term, 1918, of the supe rior court. Scammon & Gardner, of Exeter, for plain tiffs. William W. Thayer, of Concord, Harry W. Peyser, of Portsmouth, and Harry J. Brown, of Concord, for defendant. PEASLEE, J. [1] The plaintiffs seek in this bill for relief from certain decrees of jects to this proceeding, and does not wish to be advised. In this situation a bill for advice cannot be maintained. Ross V. Church, 77 N. H. 592, 90 Atl. 174, and cases cited. [2-4] The plaintiffs further contend that in effect their testator had in his lifetime ceased to be executor and had become a trustee under the will of his wife, that as such trustee he could have maintained a bill asking for advice and direction, and that since he had such right it has passed from him to his executors. But a trustee cannot take an estate under a will until he has given the bond required by the statute. P. S. c. 198, § 1. Until the trustee has so qualified, it is the duty of the executor to hold the estate in that capacity. Fernald v. Church, 77 N. H. 108, 88 Atl. 705. He therefore held the estate as executor until his decease. His trust as executor then terminated. It did not pass to his executors. P. S. c. 188, § 8. Their right and duty in the premises was to file and settle an account of his official acts. A successor to his trust has been appointed and has entered upon the duties of his office. Whatever distribution of the estate is to be made hereafter must be made by him. So far as the plaintiffs represent their testator in his official capacity, their only duty is to account for the estate as it stood when his trusteeship was terminated by his death. Judge of Probate v. Heydock, 8 N. H. 491, 498; Judge of Probate v. Claggett, 36 N. H. 381, 386, 72 Am. Dec. 314; Prescott v. er, 59 N. H. 90. All future fiduciary action is to be taken by the defendant. Farm [5, 6] The ground upon which a trustee is permitted to maintain a bill for advice is that otherwise he must act at his peril, or else wait until a claimant brings suit. Greeley v. Nashua, 62 N. H. 166. This process enables him to speedily and safely execute his trust. These plaintiffs are not so situated as to need the aid of equity in this respect. (107 A.) So far as the controversy involves a further distribution of the estate, the duty to act is upon the defendant. So far as it involves charging or discharging the plaintiffs on account of their testator's official acts, it is to be passed upon by the probate court when they settle an account. In that matter this court has no jurisdiction to direct in advance the action of that tribunal. Barrett v. Cady, supra. [7] So far as the plaintiffs represent the claim of their testator's estate as a beneficiary under his wife's will, they stand no differently than the beneficiary who appears in person. An executor who makes claim to property upon. the ground that his decedent had an interest under the will of another is not entitled to the advice of the court as to the validity of such claim. He can proceed for the recovery of what he claims, and does not need this remedy. Exception overruled. Case for negligently causing the death of the plaintiff's intestate William Wallace. Tried by jury, and verdict for the plaintiff. The intestate was injured by being thrown from an automobile in which he was riding and which was driven by one Freeman, who was at the time engaged in his employment for the defendant as the general sales agent in this state for the defendant's motor sales agency. The defendant owned the automobile, and there was no evidence that Freeman was not a skillful driver. The day before the accident Wallace had completed a bargain for a car through Freeman's agency. He and a local agent had signed a contract, which had been sent to Boston to be validated by an executive officer of the defendant's organization. He was to be in Boston the next day, and Freeman suggested that as he was to be there with a car Wallace could ride back with him as far as WALKER and YOUNG, JJ., did not sit. Manchester. It was arranged that if WalThe others concurred. (79 N. H. 217) DEARBORN v. FULLER. (Supreme Court of New Hampshire. Belknap. May 6, 1919.) 1. MASTER AND SERVANT ~302(1)—INJURIES TO THIRD PERSONS. An employer is not liable for an injury caused by his servant, not acting within the scope of his employment. 2. MASTER AND SERVANT 302(6)—INJURIES TO THIRD PERSONS-LIABILITY OF MASTER. Where a motor company's sales agent, engaged in driving a car between certain points for the company, invited one who had contracted to buy a car to ride as a guest, contrary to the company's rule that no driver should take any one into a car other than a customer who is being demonstrated a car, the company was not chargeable with the agent's knowledge of the presence of his guest, and so was not liable for the guest's injuries due to the agent's negligent driving, in the absence of proof of a custom to permit persons not intending to buy to ride. 3. MASTER AND SERVANT 300-LIABILITY OF MASTER TO THIRD PERSONS. The law of agency, as respects liability of a master for acts of his servant, rests upon the theory of a reasonable responsibility. lace decided to do so he would telephone to Freeman at the defendant's Boston office. This was done, the parties met at an agreed place, and the accident occurred while Wallace was being transported under these conditions. The defendant had a rule that "No driver or employé of the company is permitted to take any one in a car of the company other than a customer who is being demonstrated a car, or some one connected with himmeaning the customer." Wallace did not go to the defendant's place of business, or transact any business with him on the day of the accident. The defendant's motions for a nonsuit and a directed verdict were denied, subject to exception, by Allen J., who transferred the case from the March term, 1918, of the superior court. Jewett & Jewett, of Laconia, for plaintiff. Foster & Lake, of Concord, and Owen & Veazey, of Laconia, for defendant. PEASLEE, J. [1, 2] If at the time Freeman caused the injury he was not acting within the scope of his employment, the defendant is not liable. Danforth v. Fisher, 75 N. H. 111, 71 Atl. 535, 21 L. R. A. (N. S.) 93, 139 Am. St. Rep. 670. The evidence is conclusive to the effect that Freeman had This excess of his no authority from the defendant to carry authority continued as long as Freeman pursued the unauthorized course of conduct. He not only exceeded his authority in asking Wallace to ride, but also in receiving him into the car and in thereafter transporting him therein. In all that Freeman did touch Transferred from Superior Court, Belknap Wallace as a passenger. County; Allen, Judge. Action by Burt S. Dearborn, administrator of William Wallace, deceased, against Alvan T. Fuller. Verdict for plaintiff. Transferred on defendant's exception to the action of the court in denying motions for a nonsuit and a For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes |