Two brothers A and B acquired on their mother’s death vested rights each to an equal share in the trust-estates under the marriage-contract of their parents and the will of their father. After their mother’s death B, being in embarrassed circumstances, approached A with a view to a sale of his interest. B ultimately assigned his share in the trust-estates to A in consideration of A undertaking to pay certain debts due by B and to pay pounds 450 to B in cash. When the negotiations for this bargain were proceeding A had before him a valuation of his own share of the trust-estate which he had obtained for his own purposes, and which showed the value of each share to be such that if the valuation was correct A would make a profit of pounds 600 upon his transaction with B. This valuation was not disclosed by A to B. A admitted that he expected when carrying out the transaction to make a profit of a few hundred pounds; and in his cross-examination said he did not see that ‘fairness had anything to do with it.’ After receiving the pounds 450 B left the country, and thereafter his estates were sequestrated.
In an action brought by B’s trustee in bankruptcy against A, held ( aff. judgment of the Second Division) that, on payment of pounds 450 to A, the trustee in bankruptcy was entitled to reduction of the assignation.
Judges:
Lord Chancellor (Halsbury), Lord Ashbourne, Lord Macnaghten, Lord Shand, Lord Brampton, and Lord Lindley
Citations:
[1902] UKHL 383, 39 SLR 383
Links:
Jurisdiction:
England and Wales
Trusts, Insolvency
Updated: 14 July 2022; Ref: scu.630786