Whenever title to land is procured through | he asks a chancellor to assist him, do equity, by the abuse of such a confidential relation, the law reimbursing the outlay and costs of the trustee,

raises a constructive trust in favor of the party
injured thereby.

Rankin v. Porter, 7 W. 387.
Duff v. Wilson, 22 Sm. 442.
Dickey's Appeal, 23 Id. 218.

In such cases it is not necessary to show actual
fraud. The rule is founded on public policy.
Webb v. Dietrich, 7 W. & S. 401.
Chorpenning's Appeal, 8 Cas. 315.
Pierce Archer, for defendant.

So much of the bill as prays an avoidance of the loan advanced after the relation of counsel and client, is bad.

Smith v. Brotherline, 12 P. F. S. 469.
Henry v. Raiman, I Casey, 359.

unless it may be in a case of manifest fraud intended and attempted to be perpetrated. The sufficiency of the ground of demurrer turns on the question as to what constitutes a fraud perpetrated by an attorney on his client. Is it of necessity actual and intentional fraud only? Or may it consist of acts which, though wanting in candor, or in such a disclosure as good faith and fair dealing requires in a transaction between counsel and client, although free from wrongful the interests of the client, to the gain or advanpurpose, are yet of necessity such as to prejudice tage of the counsel. In Story's Equity, section 187, the principle is stated to be: Fraud in the

No case decides that a lawyer is bound to dis-judgment of a Court of Equity properly includes close to his clients his private transactions with their debtors, who owed him before he knew the clients.

GIBSON, C. J., in Dobbins v. Stevens, 17 S. & R. 15. The plaintiff can at best make defendant his trustee; that is, take his place on re-paying his loan. This we have always tendered, and now tender.

"There is nothing in his being defendant's attorney in the suit to prevent his being a bidder, if he took no undue step to the prejudice of his client."

Per SERGEANT, J., Deviney v. Norris, 8 W. 315.
C. A. V.

July 3, 1880. THE COURT (after reciting the facts). It is a well settled principle that an attorney cannot make a profit out of his office to the prejudice of the rights and interests of a client. But where investments are made by counsel bona fide, before the client has a lien or interest which is thereby prejudiced, he, cannot be said to be guilty of actual fraud. In support of this doctrine Smith v. Brotherline (12 P. F. S. 469), and Henry v. Raiman (1 Casey, 359), are cited. The first of these cases asserts the doctrine with great distinctness, Mr. Justice SHARSWOOD holding, that, the relation between attorney and client being one of confidence, whether he acts on information derived from the client or from any other source, he is affected with a trust. The rule is asserted to be an unbending one, and without exception, that when an attorney buys a title outstanding or adverse to the land, as to which he has been consulted or employed, he buys for the client, if the client should elect to take it. The cestui que trust must, of course, if

all acts, omissions, and concealments which involve a breach of legal or equitable duty or confidence, justly reposed, which are injurious to another, or by which an undue and unconscientious advantage is taken. In Galbraith v. Elder (8 Watts, 87), the Supreme Court decided that an attorney who has been consulted respecting title to lands, cannot become a purchaser thereof and set up such title against his client. He will be deemed a trustee by construction of law.

There are times and circumstances when a nondisclosure of material facts will amount to a fraudulent concealment. This general principle is too well established to require the citation of elementary authority or decided cases to support it. It is a rule founded not only in sound morals, but is recognized, as between principal and agent or client and attorney, as a rule of policy, to which parties will be strictly held. But when the case is one in which there is not merely the intentional concealment of material facts, but some acts purposely done, founded on knowledge which ought to have been disclosed, and by which the client is prejudiced and the attorney derives a benefit, the case stands clearly within the definition of constructive fraud at least; and whether the fraud be actual or constructive, the principle on which the demurrer is based has no application to a case like the one raised by these pleadings. We do not see on what principle the subsequent advance of the defendant can be sustained. It may be admitted, for the sake of the argument, that the defendant was not bound to make known the fact to the plaintiff that he had made a first loan to McCloskey, which was secured by a mortgage on the property, but no one will, we think, question that it would have been better if he had done so, that the client might have had that the fact before him before employing the defendant to collect his claim. If it had been communicated, he could have decided whether an attorney holding a prior incumbrance was the most suitable person to be intrusted

with the performance of that duty. But the | sent, buy the opposing title without holding it in trust for more advanced proposition is to us clear that those then having the title he was employed to sustain. after the professional relation was once established Mr. McKinley could secretly acquire no interest in the land which would hinder or delay or prevent the plaintiff collecting his full demand against McCloskey. This conclusion requires that the demurrer be overruled, and it is so or

dered.

Opinion by ALLISON, J.

(Henry v. Raiman, 25 Pa. St. 354.). Without expressing
any opinion as to the soundness of this case with respect to
the extent to which the principle of trusteeship is asserted,
it may be laid down as a rule that an attorney can in no
case, without the client's consent, buy and hold otherwise
than in trust, any adverse title or interest touching the
such a way put himself in an adversary position without
thing to which his employment relates.
this result. The cases to this effect are very numerous,
and they are all in harmony. We refer to a few of them.
(Smith v. Brotherline, 62 Pa. St. 461; Davis v. Smith, 43
Vt. 269; Wheeler v. Willard, 44 Id. 641; Giddings &

He cannot in

[SUPREME COURT OF UNITED STATES.-Oct. T. 1879. Coleman v. Eastman, 5 Paige, 561; Moore v. Bracken, 27

(See 11 Central Law Journ. 126, Aug. 13, 1880.)

Baker v. Humphrey.

Attorney and client-Attorney acting for adverse

interest-Fraud-Equity.

Ill. 23; Harper v. Perry, 28 Iowa, 57; Hockenbury v. Carlisle, 5 Watts & S. 349: Hobday v. Peters, 6 Jur. N. S., pt. 1, 794; Jett v. Hempstead, 25 Ark. 462; Case v. Carrol, 35 N. Y. 385; Lewis v. Hillman, 3 House of Lords, 607.)

The case in hand is peculiarly a fit one for the application of the principle we have been considering. It is

An attorney cannot in any case, without the client's consent, always dangerous for counsel to undertake to act, in regard

buy and hold otherwise than in trust, any adverse tile or interto the same thing, for parties whose interests are diverse. est touching the thing to which his employment relates. Such a case requires care and circumspection on his part. B., who had agreed to sell lands to which he claimed title, to Here there could be no objection, there being no appaH. & S. for $-000, employed W., an attorney, who had long been rent conflict of interests; but upon discovering that the title employed by him to do legal business, to draw the contract of sale, which W. did, and witnessed its execution. H. & S. then was imperfect, it was the duty of the attorney promptly to employed W. to examine the title. In doing tuis W. found that report the result to Baker, as well as to Hurd & Smith, and the title was apparently in C., though C. had never asserted it. to advise with the former, if it were desired, as to the best W., for a consideration of $25, represented that he wished it to mode of curing the defect. Instead of doing this, he careprotect the title of clients, procured a conveyance of the lands to his brother from C. The brother was not cognizant of this fully concealed the facts from Baker, gave Hurd & Smith transaction. Thereafter W. instituted an action of ejectment in the choice of buying, and, upon their declining, bought his brother's name to recover the lands. In an action by B. to the property for himself, and has since been engaged in a have the deed to the brother of W. declared fraudulent, etc. bitter litigation to wrest it from Baker. For his lapse at Held, that the relation of client and counsel subsisted between B. and W., and the conveyance from C. to the brother inured to the outset there might be some excuse, but for his conduct subsequently there can be none. Both are condemned alike by sound ethics and the law. They are the same upon the subject. Actual fraud in such cases is not necessary to give the client a right to redress. A breach of duty is "constructive fraud," and is sufficient. (Story's Eq. secs. 258, 311.)

the benefit of B.

Appeal in equity from the Circuit Court of the United
States for the Eastern District of Michigan.
Mr. Justice SWAYNE delivered the opinion of the Court,
of which the following is an extract:-

But there is another and a higher ground upon which our judgment may be rested. The relation of client and counsel subsisted between the attorney and Baker. Whether the relation subsisted previously, or was created only for the purpose of the particular transaction in question, it carried with it the same consequences. (Williamson v. Moriarty, 19 W. R. Irish Law and Eq. 818.)

It is the duty of an attorney to advise the client promptly whenever he has any information to give which it is important the client should receive. (Hoopes v. Burnett, 26 Miss. 428; Jett v. Hempstead, 25 Ark. 462; Foy v. Cooper, 2 Q. B. N. S. 937.) In Taylor v. Blacklow, (3 Bing. N. C. 235), an attorney, employed to raise money on a mortgage, learned the existence of certain defects in his client's title, and disclosed them to another person. As a Consequence, his client was subjected to litigation, and otherwise injured. It was held that an action would lie against the attorney, and that the client was entitled to recover. In Com. Dig., tit. "Action on the case for deceit, A. 5," it is said that such an action lies "if a man, being entrusted in his profession, deceive him who entrusted him, or if a man retained of counsel became afterwards of counsel with the other party in the same cause, or discover evidence or secrets of the cause. So, if an attorney act deceptive to the prejudice of his client, as if by collusion with the demandant, he make default in a real action whereby the land is lost." It has been held that if counsel be retained to defend a particular title to real estate, he can never thereafter, unless his client con

The legal profession is found wherever Christian civilization exists. Without it society could not well go on. But, alike all other great instrumentalities, it may be potent for evil as well as for good. Hence the importance of keeping it on the high plane it ought to occupy. Its character depends upon the conduct of its members. They are officers of the law, as well as the agents of those by whom they are employed. Their fidelity is guaranteed by the highest considerations of honor and good faith, and to these is susperadded the sanction of an oath. The slightest divergence from rectitude involves the breach of all these obligations. None are more honored or more deserving than those of the brotherhood who, uniting ability with integrity, prove faithful to their trusts and worthy of the confidence reposed in them. Courts of justice can best serve both the public and the profession by applying firmly, upon all proper occasions, the salutary rules which have been established for their government in doing the business of their clients.

We shall discharge that duty in this instance by reversing the decree of the Circuit Court, and remanding the case, with directions to enter a decree whereby it shall be required that the complainant, Baker, deposit in the clerk's office for the use of the defendant, George P. Humphrey, the sum of $25, and that Humphrey thereupon convey to Baker the premises described in the bill, and that the deed contain a covenant against the grantor's own acts, and against the demands of all other persons claiming under him.

And it is so ordered.]

ginia Aimée Bouillou, and that on its becoming | creditor from the State, and his not being heard due he was desirous of paying the same, but in of for many years. DUNCAN, J., in ruling that the mean time Virginia A. Bouillou had died case, said, "If the principle be true that absence domiciled in France, and owing to a dispute as is an answer to a demand of interest, because to who was entitled to administer on her estate, there is no one to whom the principal can be he had been notified to make no payment. The tendered, then this consequence would follow, interest had been paid up to November, 1877. as death would more effectually preclude a In August, 1878, Hart, on payment of the prin- tender, interest could never be recoverable cipal and $135 interest into Court, subject to the mesne between the death of the creditor, and opinion of the Court as to his liability for said taking out letters of administration." interest, obtained a decree for satisfaction. In April, 1880, John W. Burch having obtained let ters of administration on Bouillou's estate from the Register of Wills of Philadelphia, made the present application. Hart resisted the payment of interest from November, 1877, to August, 1878. V. Guillou, for the petitioner. Chas. Hart, contra.

May 8, 1880. THE COURT. The petitioner paid into Court the sum of three thousand dollars principal, and one hundred and thirty-five dollars interest, of a mortgage made by him to Virginia Aimée Bouillou in her lifetime, and had the mortgage satisfied of record under the Act of 3 April, 1851.

His reason for paying the money into Court was that Virginia Aimée Bouillou having died in France, where she was there domiciled, a contest had arisen as to the right of administration to her estate, and that no legal representative had been appointed to whom he could safely pay the money; and being desirous of having the said mortgage satisfied of record, he obtained leave to pay the money into Court subject to the decision of the Court as to his liability to pay the interest that was due on said mortgage and paid by him into Court.

The petitioner rests his objection to pay interest on the fact that he was ready and desirous of paying off the mortgage, and that there was no person to whom he could legally pay it by reason of the contest over the said estate.

In Shaeffer's Estate (9 S. & R. 263), it was held that a debtor is not exempted from the payment of interest, by the continued absence of the

Some suggestion having been made in that case that there was a distinction between a person absent from the State and one beyond the sea, the learned Judge said "The absent creditor, I mean absent beyond sea, is a privileged creditor. The Act of Limitations does not run against him. If he is within the United States after the debt becomes payable, it then first runs, and continues to run, notwithstanding subsequent absence beyond sea. It would seem equally reasonable, that his interest would be as much protected by his absence, as the principal." Defendants being indebted to equitable plaintiffs as a firm, each member of the latter firm gave notice to the defendants not to pay any of the indebtedness to the other: Held, that

such notice did not relieve the defendants from liability for interest on their indebtedness. (King v. Kelley, 1 P. F. Smith, 36; see also Hummel v. Brown, 12 Har. 310, and cases there cited.)

If then the running of interest be not stopped, except in occasional instances, by absence from the State; or beyond sea; or by death of the creditor until administration be granted; or by notice from adverse claimants not to pay; à fortiori it would not be stopped in a case like this where under the law the debtor could protect himself by paying the money into Court. The remedy was in his own hands, and as soon as the money was paid into Court the interest ceased. Rule absolute.

Opinion by PEIRCE, J.

C. P. No. 2.

June 17, 1880.
Roan.

Kingsessing Building Association v. Building association-Married woman-Administration-Usury-Jurisdiction.

Motion to reduce assessment of damages. This was an action of scire facias upon a building association mortgage given by Susan L. Roan, a married woman. Mrs. Roan died, leaving no lineal descendants. Administration was granted to her husband, against whom the writ in the present case was issued, and who made no defence. The next of kin, entitled to the realty of the decedent in remainder, filed an affidavit of defence. After the cause was at is

sue as to the next of kin, the plaintiff entered course of administration to exonerate the realty, judgment against John T. Roan as administrator this Court will administer equity under common and in his own right. law forms, and so, having all parties before it, it will not turn the remainder-men out of Court, and force them to go to the Orphans' Court to ask for a surcharge.

Wolbach v. Lehigh Building Association, 4 WEEKLY the rule.
NOTES, 157.

[HARE, P. J. Have the remainder-men any status here, as the administrator makes no defence?]

The fact that the administrator does not ask for the application of the stock is not of moment. Since the personalty is bound in the