
    *Bailey’s Adm’x &c. v. Robinsons.
    April, 1844,
    Ricbmond.
    
      [ 42 Am. Dec. 540.]
    (Absent Cabell and Stanard, J.)
    i. Executor—Purchase of Land at His Own Sale—Effect.—A purchase of land by an executor, at a sale made by himself as such, is a violation of his duty as trustee; and an invasion of the rights of his cestuis que trust; who are entitled to relief in a court of equity.
    2. Same—Same — Mode of Relief—Upset Price.—The general rule in such cases is, that though the sale may have been irregularly and fraudulently conducted, and the property sold for less than its value; the proper mode of relief, is not to subject the trustee to the payment of the actual value of the land at the time of the sale, upon the conjectural estimate of witnesses; but at the election of the cestuis que trust, to direct a resale at a proper upset price.
    3. Same—Same -Same.—a mere depreciation since the trustee’s purchase, in the market value of the property, arising from a change in prices, does not warrant an exception to this general rule.
    
      4. Decrees.—Error to decree in favour of a person not a party in the cause.
    Dixon Robinson of the county of Fauquier, died in 1816, having' first made his will, by which he gave his whole estate to his wife for life, or until she married; and then, (after a specific legacy of a slave to each of his eleven children,) he directs that after the death or marriage of his wife, the whole of the property devised to her, be sold (the land on a credit of twelve months) to the highest bidder; and the money to be equally divided among his children then living: a.nd he appointed Carr Bailey ,and Samuel Weaver his executors; who qualified as such, in the county court of Fauquier.
    The land consisted of a tract’ of about one hundred and fifty-five acres: and the personal estate, after taking out the specific bequests, consisted of four slaves, and some perishable property.
    In 1817, the widow having died, the executors proceeded to sell the property, when the perishable part of it was purchased for the benefit of the children, *eight of whom ' were then infants: one of the slaves was brought by the executor BaiLey, at the price of 516 dollars 50 cents. The land was also purchased by Bailey at 8 dollars 50 cents per acre.
    In 1822, the children of Dixon Robinson filed their bill in the late superior court of chancery for the Fredericksburg district, against the executors Bailey and Weaver; in which they charge, that after the death of their mother, the executors possessed themselves of the whole estate real and personal, for which they had never accounted. That in May 1817, they proceeded to sell the land; and sold it upon the terms of not delivering possession thereof, for twelve months from the day of sate. That Bailey repeatedly declared at the sale, that he wished to purchase the land for the benefit of the daughters of Dixon Robinson; whereby many who would have given 10 or 12 dollars an acre for it, were induced not to bid; so that Bailej' became the purchaser at 8 dollars 50 cents per acre: and that the other executor- Weaver had since executed to Bailey a deed for the land. That Bailey still retains the title, and possession of the land, which is worth considerably more than the price for which it was sold. They therefore pray that the sale of the land may be set aside; and that the same may be resold; and that the executors may be compelled to settle their executorial accounts.
    Before the executors had answered the bill, the plaintiffs, and a certain Samuel Mooney, who claimed to be assignee of Jackin Robinson, one of the children and devisees of Dixon Robinson, filed an amended and supplemental bill; in which they charge that in December 1816, at the sale of the slaves and personal effects of his testator, Bailey declared in the presence of divers persons who attended the sale for the purpose of bidding thereat, that he desired to purchase in the slaves and personal effects for the benefit of the daughters of Dixon *Robinson; whereby many persons from kindness to the daughters, declined bidding; so that Bailey became the purchaser of the slaves and other personal effects at a price much below their value; and having thus obtained them, claims and uses them as his own. The plaintiffs therefore pray that Bailey may be held responsible to them for the price at which the land and slaves would have then sold at a fair sale.
    Bailey and Weaver answered separately. Bailey says, that the perishable property was purchased by Polly Robinson for herself and the other legatees; and has ever since remained in their possession, or has been consumed by them. That the land was sold on the terms stated in the bill; that it was a fair sale, and brought a full price. That after the sale, the children of Dixon Robinson lived upon the land, and enjoyed the profits of it; and have never paid him any rent; but are still his debtors for this, and other advances to them and the widow. That he purchased one slave for 516 dollars 50 cents—more than his value: that one of the slaves was a subject of expense, and entirely unfit for service; that another was also old, and could not be sold at public auction; and that she was ultimately disposed of for 25 dollars, in a bond of William Robinson, who married the plaintiff Polly: and that the other slave was sold to a certain John Brown for 510 dollars. That he purchased none of the personal effects, except a wheat fan; and that was permitted to remain in the service of the family.
    Weaver answered to the same effect.
    The accounts were referred to a commissioner, before whom depositions were taken ; and the evidence satisfied the commissioner, and the court below, that the allegations of the bill as to the conduct of Bailey at the sale were sustained by the proofs, and that but for this conduct the land would have brought 11 dollars per acre; and the commissioner in his report, charged Bailey with the land at that price.
    *Whilst the cause was before the commissioner, a certain William Lawler appeared before him, claiming two shares of the estate, as the assignee of William Robinson, who claimed to hold one share in right of his wife Polly, and one as the assignee of Henry Robinson ; though he was in no way made a party in the cause.
    The defendant Bailey died whilst the cause was before the commissioner, and it was revived against his administratrix.
    The cause came on for final hearing before the circuit superior court of law and chancery for the county of Prince William, (to which it had been removed), in October 1834, on the report and exceptions thereto; when the court made a decree, fixing the liability of Bailey for the land at 11 dollars per acre; sustaining Lawler’s claim as assignee; and referring the cause to a commissioner, to enquire into, and report upon other matters connected with the accounts.
    Prom this decree Bailey’s administratrix appealed.
    Lyons and Stanard for the appellants,
    contended that there was no actual fraud on the part of Bailey, in the purchase of the land: and they went into a minute examination of the testimony, to prove that he in fact acted with a single purpose to benefit the infant children ; who had been permitted to live upon the land, from the time of the purchase, until the institution of this suit, without paying rent. That the deviation from the terms of sate directed in the will of Dixon Robinson was necessary under the circumstances of the family; and that in fact, Bailey had given as much, or more than the land was ever worth.
    They farther insisted, that the court could not undertake to inflict a penalty upon the purchaser, upon any speculative enquiry as to what the land might have been sold for. That the utmost that courts of equity have ever done in the case of a purchase of trust property *by a trustee, is to give the cestuis que trust, the option of claiming the property themselves, or affirming the sale and claiming the purchase money. They referred to 2 Tuck. Com. 460, and Buckles v. Lafferty, 2 Robinson’s R. 292, and distinguished the case from Moore v. Hylton and others, 12 Leigh 1.
    They also objected, that it was improper to make a decree in favour of Lawler, who was no party to the cause.
    C. & G. N. Johnson for the appellees,
    
      went into an examination of the evidence, to prove that Bailey was guilty of actual fraud, in the sale and purchase of the land. That the pretence of buying for the benefit of the children, was a mere pretence; he claiming in his answer, that they were indebted to him for the rents: and not having paid the purchase money, he' obviottsly intended to pay it off, by the application of the rents to it.
    Taking Bailey to have acted fraudulently, they referred to Williams on Ex’ors 1105; 3 Bac. Abr. Ex’ors, § 1, p. 77; Carter’s ex’or v. Cutting and wife, 5 Munf. 223, and Moore v. Hylton, as establishing the measure of his liability. They distinguished the case of Moore v. Hylton from Buckles v. Lafferty; and insisted, that these authorities sustained them in claiming that Bailey should be compelled to take the land at the fair market valued when it ought to have been sold. That this is no more speculative or penal, than every recovery in trover and conversion against a man who has taken the personal property of another, though under the belief that it was in law his own; the recovery being of the value at the time of conversion. And so of every agent who violates the instructions of his principal; he is held to account for the value of-the subject in the market, if he had sold it at the time the principal directed him to sell. They cited Bell v. Morrison, 1 Peters’s R. 351.
    
      
      Fiduciaries — Purchase of Trust Subject by. —A purchase by a trustee, or party holding any fiduciary relation, of a trustproperty or sublect, although he may have given an adequate price therefor and gain no advantage whatsoever, is voidable at the pleasure of the cestui que trust, or party to whom such confidential relation is borne by the purchaser, and if, at the time of the purchase, the vendee occupied such confidential relation, this sale can be set aside by the cestui que trust, or party occupying his position, at his pleasure, whether the purchase was one made directly from them or was made by the trustee from himself. Newcomb v. Brooks, 16 W. Va. 59, 62, citing, among others, the principal case; Buckles v. Lafferty, 2 Rob. 299; Segar v. Edwards, 11 Leigh 213. See also, Lane v. Black, 21 W. Va. 623.
      Green, P., who delivered the opinion of the court in Newcomb v. Brooks, 16 W. Va. 32, observed (p. 63) that, in some of the states, the courts have hesitated about applying the strict rule above stated to executors and administrators; and that, in some, they have refused to apply it to the purchase by an executor or administrator, especially to the purchase of personal property. Continuing he said: “ But in other states the strict rule we have laid down is applied to executors and administrators, as it is to other fiduciaries. In Virginia the court of appeals in Anderson & Starke v. Fox et al., 2 H. & M. 245, refused to apply the strict rule we have stated to an executor, who bought personal property at a public sale, apparently on the ground that the practice was so common in Virginia, that to so hold would operate to render voidable the title to a great amount of personal property. Chancellor Taylor of the superior court of chancery of the Richmond District in McKey executor of Fuqua v. Young, 4 H. & M. 430, held that a purchase by an executor of land at a public sale made by himself was not voidable, when the sale was fair and correct. But this decision has been overruled by the Virginia Court of Appeals in Moore v. Hilton, 12 Leigh 2-28, and Bailey’s Adm’x v. Robinsons, 1 Gratt. 4-9; and in Michoud et al. v. Girod et al., 4 How. 557, the Supreme Court of the United States decided, that no distinction could properly be made between executors and administrators and other fiduciaries, and the strict rule should be applied to them also, and that any purchase by them of themselves must be held voidable at the option of those interested in the estate.”
      To the point that fiduciaries are disqualified'from purchasing the trustsubiect; and that, insuch case, the sale is voidable at the option of the cestui que trust, or party occupying his position, and, when attacked, must be set aside, although the price was fair and the motive pure, the principal case was also cited in Howery v. Helms, 20 Gratt. 1, 7, and footnote; Davies v. Hughes, 86 Va. 913, 11 S. E. Rep. 488; Tennant v. Dunlop, 97 Va. 241, 33 S. E. Rep. 620; Smith v. Miller, 98 Va. 541, 37 S. E. Rep. 10; Lewis v. Broun, 36 W. Va. 7, 14 S. E. Rep. 446.
    
    
      
      Same—Same—Relief,—In Christian v. Worsham, 78 Va. 107, it is said: “ The principle adopted by courts of equity in cases where trustees have, even improperly and illegally, purchased for their own benefit trustproperty held-toy them, and pay for and improve it, is that relief will be granted to the beneficiaries, asking the aid of the court, only on such terms as will fully reimburse and secure to the .trustee all that he has expended. For the English rule On this subject,'refer to the note to Fox v. Mackreth, and to Pitt v. Mackreth, 1 Leading C. Eq., top pages 234, 235, 259, 260, and authorities there cited. The rule is the same in this state. Buckles v. Lafferty, etc., 2 Rob. R. 293; Bailey's Adm'x v. Robinsons, 1 Gratt. 4.”
      
    
    
      
      Decrees,—See monographic note on “ Decrees ” appended to Evans v. Spurgin, 11 Gratt. 615.
    
   *BALDWIN, J.,

delivered the opinion of the court.

The courtis of opinion, that the purchase by the executor Bailey of the land in the proceedings mentioned, at the sale thereof made by him and his coexecutor, was in itself a violation of his duty as trustee; and an invasion of the rights of his cestuis que trust; who are entitled to redress in a court of equity. According to the general rule in such cases, though the sale may have been irregularly and fraudulently conducted, and the property sold for less than its value, the proper mode of relief is not to subject the trustee to payment of the actual value of the land, at the time of the sale, upon the conjectural estimate of witnesses; but, at the election of the cestuis que trust, to direct a resale at a proper upset price. A mere depreciation since the trustee’s purchase, in the market value of the property, arising from a change in prices, does not warrant an exception to this general rule; the more especially in a case like this, in which no depreciation whatever is charged by the complainants, in either their original or amended bill. The court is therefore of opinion, that the said decree of the circuit court is erroneous, in requiring the appellants the representatives of said Bailey to retain the said land at the price fixed by the court; instead of directing a resale thereof at a proper upset price; to be ascertained by an account, debiting the price at which the land was purchased by said Bailey, with interest thereon, and with any substantial and permanent improvements made by said Bailey on the lánd since his purchase; and crediting the rents or profits of the land since his purchase, except during the enjoyment thereof by the testator’s family. The balance of such account, with the addition thereto of a reasonable allowance, for the commission and charges of resale, is the sum at which the'land on a resale should be set up, on a credit of 12, 18 and 24 months, for equal instalments of the purchase money, with interest on those instalments from the day of sale. If the land should *not sell for more than the upset price, the purchase heretofore made by said Bailey should in all respects stand confirmed; and the purchase money and interest thereon remaining due, after crediting, at the proper dates, any payments made oh account thereof; and after also crediting the rents or profits of the land since said Bailey’s purchase, during the period of the enjoyment thereof by his testator’s family, paid into court for distribution amongst the appellees, and those claiming under them, according to their respective rights. If the land should sell beyond the upset price, then the former sale should be vacated; and the case further proceeded in, by causing the purchase money on such resale to be paid; and a proper conveyance to be made to the purchaser; and the proceeds of sale applied, first to pay the charges of sale, and secondly to the administrators of ’ said Bailey the amount of his permanent improvements aforesaid; and thirdly any payments made by him on account of the original purchase money, with interest thereon; and the residue to be distributed amongst the appellees, and those claiming under them, according to their respective rights. And the court is further of opinion that the said decree is also erroneous in prematurely deciding upon the claim of Lawler to the shares of Mary and Henry Robinson in the estate of" the decedent Dixon Robinson; the said Lawler not being a party in the cause, and that he ought to be made a party by the proper proceedings. It is therefore ordered and decreed that so much of the said decree of the circuit court as is in conflict with the principles above declared, be reversed and annulled, with costs to the appellant; and the cause is remanded to the said circuit court, to be further proceeded in according to the principles of this decree, and of so much of said decree of the circuit court as is not in conflict therewith, and for the further enquiries before a commissioner directed by that decree; and for the decision of such questions in the cause as have not yet been adjudicated, and for a final decree.  