Ex Parte Lacey: 5 Feb 1802

Trustee Not To purchase Property of Trust

Lord Eldon held that equity imposed stringent duties on persons who were appointed trustees of trusts and that these duties were imposed with ‘relentless jealousy’ in order to ensure that trustees fulfilled their duties, and that trustees had to be ‘watched with infinite and the most guarded jealousy’
No trustee shall buy the trust property, until he strips himself of that character. Or by universal consent has acquired a ground for becoming the purchaser: ‘I say, whether he makes advantage or not, if the connection does not satisfactorily appear to have been dissolved, it is the choice of the cestui que trusts, whether they will take back the property, or not; if the trustee has made no advantage. It is founded upon this; that though you may say in a particular case that he has not made advantage, it is utterly impossible to examine upon satisfactory evidence and the power of the court, by which I mean, in the power of the parties, in 99 cases out of 100 whether he made advantage or not’
The beneficiaries of a trust can, by giving their fully informed consent, agree to authorise or permit their fiduciary to act notwithstanding a conflict of interest or to receive certain profits

Lord Eldon LC
[1802] EngR 75, (1802) 6 Ves Jun 625, (1802) 31 ER 1228
England and Wales
See AlsoEx Parte Lacey 1789
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Cited by:
CitedLehtimaki and Others v Cooper SC 29-Jul-2020
Charitable Company- Directors’ Status and Duties
A married couple set up a charitable foundation to assist children in developing countries. When the marriage failed an attempt was made to establish a second foundation with funds from the first, as part of W leaving the Trust. Court approval was . .

Lists of cited by and citing cases may be incomplete.

Equity, Trusts

Leading Case

Updated: 11 November 2021; Ref: scu.344892