Williams v Scott: PC 1900

(New South Wales) The Board was asked whether an abstract of title was good because it appeared from the abstract that there had been a purchase by a trustee without full consent or release from the beneficiaries.
Held: The purchase of trust property by a trustee is not permitted except with the consent of the court or pursuant to an express power: ‘It is important to remember upon whom the onus of proof falls. It ought not to be assumed, in the absence of evidence to the contrary, that the transaction was a proper one, and that the cestui que trusts were informed of all necessary matters. The burthen of proof that the transaction was a righteous one rests upon the trustee, who is bound to produce clear affirmative proof that the parties were at arm’s length; that the cestui que trusts had full information upon all material facts; and that, having this information, they agreed to and adopted what was done.’ and ‘It is clear undisputed law that a trustee for the sale of property cannot himself be the purchaser of it – no person can at the same time fill the two opposite characters of vendor and purchaser.’
Sir Ford North
[1900] AC 499
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Updated: 05 December 2020; Ref: scu.223775