THE EFFECT OF THE STATUTE OF LIMITATIONS ON ACTIONS TO ENFORCE TRUSTS.

A trust is defined to be an equitable right in or title to property distinct from the legal ownership of such property. The legal title is vested in the trustee not for his own use, benefit or profit, but for the use, benefit or profit of the cestui que trust. If the trust is created in express terms by some writing, such as a deed or a will, it is called an express or direct trust. Being created by writing, it must be proven by the production of the writing, and parol evidence is not admissible in the first instance to establish its existence. From the two presumptions of law that "possession of property is prima facie evidence of ownership," and that " every man is to be deemed innocent until the contrary is shown," we deduce another presumption which is that "where an individual is in possession of property to which he has title, the law will presume that he is holding in subordination to such title." If his title is evidenced by a deed, the law presumes that he is holding under such deed, and claims just that interest and estate in the property conferred by the deed. There is no presumption that he is a wrongdoer or trespasser invading the rights of others, or that he will assert a claim adverse to the title which he may lawfully exercise.

As express or direct trusts are only created and proved by some instrument in writing, that instrument constitutes the title of the parties and measures their respective rights. Hence, if the trustee be in possession of the trust property, the law presumes that his possession is in accord with the title vested in him, and that he claims just such estate as he might claim under the instrument without becoming a trespasser. His title in such case would be consistent with that of his cestui que trust, and his possession that of the cestui que trust. His possession being consistent with the rights of the cestui que trust, is a continuing acknowledgement of his rights.

A failure of the trustee to execute the trust, which does not amount to a denial of the cestui que trust rights, will not cause the statute of limitations to run in favor of the trustee. It would be unjust to hold, because the beneficiary did not see fit to insist upon the prompt performance of all the conditions

and terms of the trust as rigidly as he might have done, that he should lose not only the past benefits aud profits, but those which were to accrue in the future, without notice that the trustee was holding otherwise than as trustee. So long, therefore, as the trustee does no act inconsistent with the rights of the beneficiary and amounting to a repudiation of the relation between them, the trust will continue and be in force as a subsisting trust, even though the trustee may have failed to perform his entire duty as trustee. Story's Equity, §§ 1028a, 1520a; Angell on Limitations, § 468; Jackson v. Davis, 5 Cowen, 123; McNich v. Trego, 73 Pa. St. 52.

Acts done by the trustee are not to be deemed adverse so long as they are reconcilable with the existence of the trust; and acts which if done by a stranger would be deemed to be adverse, are not necessarily construed as adverse when done by the trustee. Any act which his title authorizes him to perform is not adverse. If, however, the trustee of an express trust repudiates the trust, and denies to the beneficiary all rights in the trust property, or in the income and profits thereof, and the beneficiary has notice of such facts, the possession of the trustee becomes adverse, and the statute of limitations will commence to run in his favor. The beneficiary would then have a cause of action against the trustee to enforce the trust, and there is no reason for placing him in a better situation than other suitors who sleep on their rights. He must assert his rights within the period limited for the recovery of the legal estate at law, or he will be as effectually barred as if his estate was a legal, instead of an equitable Angell on Lim., § 472; Story's Equity, § 1520 a; Crook v. Glenn, 30 Md. 55; New Market v. Smart, 45 N. H. 87; McNair v. Lot., 34 Mo. 285; Ricords v. Watkins, 56 Mo. 553; Clarke v. Boorman, 18 Wall. 493.

one.

The notice to the beneficiary that the trustee is holding adversly ought to be so definite and positive, or the possession of the trustee must be so open and notoriously hostile, as to distinctly inform the beneficiary that the trustee is no longer holding as trustee, but had repudiated that relation and was asserting rights over the trust property inconsistent with his equitable title. If the notice be equivocal, or if it be insufficient to dispel the presumption that the trustee will hold in ac

cordance with his title, the doubt should be resolved in favor of the beneficiary. Love v. Watkins, 40 Cal. 547; Jones v. McDermott, 114 Mass. 400; Nease v. Capeheart, 8 W. Va. 95.

While the general rule or presumption in cases involving express or direct trusts is that lapse of time, however long continued, is no bar to the enforcement in a court of equity of a trust as between the trustee and beneficiary; in cases of implied, resulting and constructive trusts, the general rule is directly contrary, and in all such cases, courts of equity hold that an action to declare or enforce the trust must be brought within that period of time which would constitute a bar to an action at law, unless there be about the case some feature to take it out of the general rule. In other words, in all cases of implied trusts, courts of equity adopt the statute to the same extent as the law courts, and will not afford a remedy to a party who has slept on his rights after an action at law would be barred. The reason for this rule is the absence of any agreement giving the person to be charged as trustee a right to hold or control the property. The trustee, from the commencement, stands in the attitude of a trespasser or wrongdoer. Whatever control he has obtained over the trust property has been acquired. at the expense of the beneficiary and by depriving him of some legal right in the property. If the trustee assumes any control, the beneficiary must understand that he is an intermeddler, and that the assertion of such dominion is inconsistent with his own title. trustee has not been made the repository of confidence, and the beneficiary has no ground to suppose that the trustee is holding for his benefit. The trustee's title is adverse to the beneficiary's from its inception. Story's Equity, § 1519; Perry on Trusts, § 865; Johnson v. Smith, 27 Mo. 591; Smith v. Ricords, 52 Mo. 581; Wells v. Perry, 62 Mo. 573; Wilhelm v. Caylor, 32 Md. 151.

The

The exception to the general rule in cases of implied trusts, is where the party to be declared a trustee has practiced some fraud or deception, by which the beneficiary has been prevented from discovering that he had a cause of action against him. The fraud must be secret or concealed, as distinguished from that which is open, visible and known. Martin v. Smith,

1 Dillon, 85; Angell on Lim. §§ 183-191. It must be a concealment of the cause of action; for if the party knows that he has a cause of action, the statute will run against him, even though he may be ignorant of the evidence by which it may be established. Parham v. McCravy, 6 Rich. Eq. Rep. 140; Hunter v. Hunter, 50 Mo. 445. So, whenever he has information sufficient to reasonably create the belief that a fraud has been perpetrated, the statute will commence to run. Angell on Lim, § 187; Story's Equity, § 1521 a. He must use reasonable diligence in his efforts to ferret out and discover the fraud. Martin v. Smith, supra.

The statute runs before the discovery of the cause of action, unless defendant conceals his liability. Pilcher v. Flinn, 30 Ind. 202; Foot v. Farrington, 41 N. Y. 164; 6 W. Va. 168. False testimony as to his liability will suspend the statute. Gerry v. Dunham, 57 Me. 334. But mere ignorance of the facts constituting the cause of action is insufficient. Smith v. Newby, 13 Mo. 159; Badger v. Badger, 2 Cliff. 137. The concealment, which suspends the statute, must be of an affirmative character. Mere silence will not have that effect. Wynne v. Cornelison, 52 Ind. 312; State v. Giles, Ib. 356. Concealment of facts which occurred prior to the time when the cause of action accrued, will not prevent it running. Stanley v. Stanton, 36 Ind. 445. The concealment must be by the defendant. ment by a person other than the defendant will not suspend the statute. Wells v. Halpin, 59 Mo. 92.

Conceal

The burden of proof is on the party seeking to avoid the statute to show that the facts were fraudulently concealed. Blethen v. Lovering, 58 Me. 437. The law presumes that fraud will be discovered as soon as committed; and if the evidence fails to show when it was first discovered, it will be treated as known at once. Hunter v. Hunter, 50 Mo. 445.

SIR FITZROY KELLY, Chief Baron of the English Court of Exchequer, and an octogenarian of some years standing, is at last about to retire. Years ago he was known as apple-pip Kelly, the nickname having been obtained from his ingenious defense of a man who had poisoned his victim with prussic acid. The postmortem had shown the presence of a large quantity of the poison in the stomach of the deceased, and among other matter was found some undigested apple. The learned counsel made the physician admit that there was prussic acid in apple-pips, and also that it would be possible for a man to eat enough apple-pips to kill himself.

EVIDENCE-ENTRIES MADE IN COURSE OF BUSINESS.

DILLON V. TOBIN.

Irish Court of Probate—December, 1877.

1. TO RENDER AN ENTRY MADE BY A PERSON in the course of business or duty admissible in evidence after his death, it is not necessary that the duty should be one imposed by law.

2. AN ENTRY OF THE BAPTISM of T. D., contained in the Baptism Book of a Roman Catholic Parish Church, in the handwriting of the clergyman who performed the ceremony, was received in evidence after his death, it being proved that, by the rules of the church, it was his duty to make the entry, and that neglect of such duty would render him liable to ecclesiastical penalties. Davis v. Lloyd, 1 C. & K. 275, disapproved. Malone v. Lestrange, 2 I. E. R. 16, approved and followed. Farrell v. Maguire, 3 I. L. R. 187, distinguished.

Issue directed by the court-whether the plaintiff, Thomas Dillon, was the legitimate son of Alexander Dillon and Catherine Dillon, otherwise Keelahan. The defendant, Mrs. Maria Tobin, claimed as sole next of kin; and the case turned up the question whether the plaintiff, Thomas Dillon, was born after or before the marriage of his father and mother.

On behalf of the defendant an entry in the Baptism Book, kept in the Roman Catholic Church of Francis street, Dublin, purporting to be a record of the baptism of Thomas Dillon, on 14th November, 1834, was tendered in evidence. Edward Sherwood, the clerk of church, deposed that the entry was in the handwriting of the Rev. Richard Murray, who was, at the time, one of the clergymen of the parish, and was since dead. The Very Rev. Canon Pope proved that it was the practice to make such entries either at the time the ceremony took place or immediately afterwards; that it was obligatory on the priest to do so under ecclesiastical penalties. The entry appeared to have been made at the time.

Elrington, Q.C., and Samuels, for the plaintiff, objected to the entry being received. Taylor on Evidence, section 1577. [Warren, J.-Does not this case come within the principle of Price v. Torrington, 1 Sm. L. C. 290?] We submit not. It is not an entry made in the course of any duty recognized by law. Smith v. Backey, L. R., 2 Q. B. 326; 36 L. J. Q. B. 160. The rules of the Roman Catholic Church are of no legal validity; Davis v. Lloyd, 1 C. & K. 275; Farrell v. Maguire, 3 I. L. R. 187.

There must be corroborative circumstances. Doe v. Turford, 3 B. & Ad. 890.

Murphy Q.C.. and Webb, Q.C., for the defendant, contra. The evidence comes directly within the authority of Price v. Torrington, 1 Salk. 289; 1 Sm. L. C. 290. It would be monstrous if any entry in a drayman's book were admissible and the record kept by a clergyman in the performance of his duty not. In Malone v. Lestrange, 2 I. E. R. 16, a similar entry was received by Lord Plunket. In Murphy v. Smart, at hearing a few days ago, before Chatterton, V.C., evidence of this character was, after argument, received.

Rynd, amicus curiæ. In Rothery v. Rothery, a case in this court in 1876, this question was considered, and an entry of a similar character was received.

WARREN, J.:

In

In Rothery v. Rothery there was no question raised as to the admissibility of the entry-except as to one word in it—the word "conjugum." this case, the evidence is that the entry was made by a Roman Catholic clergyman, either at the time of the occurrence or immediately after, and that the clergyman is dead. It is proved by Canon Pope that it was the duty of the clergyman to make the entry. This appears to me to bring the matter distinctly within the principle of Price v. Torrington, supra, that entries made by a deceased person in the course of his business, contemporaneous with the occurrence, are admissible in evidence. It was the Rev. Mr. Murray's duty to obey the rules of his church just as much as it was the drayman's business to obey the master's orders. This principle was acted on by Lord Plunket in Malone v. Lestrange. In Farrell v. Maguire there was no evidence that it was the duty of the clergyman to make or give the certificate, nor was it contemporaneous. The case of the entry made by the Jewish Rabbi (Davis v. Lloyd) appears more in point; but in the edition of Mr. Taylor's Book on Evidence, which I have before me, he says it seems difficult to reconcile that case either with sound principle or with previous decisions. I shall follow the authority of Lord Plunket in Malone v. Lestrange and admit the evidence. The evidence was admitted accordingly.

NOTE. That the doctrine laid down in Price v. Torrington, supra, ought not to be extended, see per Lord Abinger, Brain v. Price, 11 M. & W. 773. See Ennis v. Carroll, 17 W. R. 344, holding entries in registers kept in R. C. Chapels inadmissible; but in that case there was no evidence of death, that the entry was contemporaneous, or of duty to make the entry. See, also, In re. Grimes, 11 I. R. Eq. 472, where an entry in the Registry of Baptisms, in a R. C. Church, was admitted, but without discussion. Irish Law Times Reports.

NEGOTIABLE INSTRUMENTS-" DUE

DILIGENCE."

PIER v. HEINRICHSHOFEN.

Supreme Court of Missouri-October Term, 1877.

1. WHERE A BANKER MAKES USE OF THE PUBLIC MAIL in forwarding a note for collection, and, through its interference or neglect, the letter containing the note is not delivered to the receiving bank, it does not excuse the endorser, even though the interference was caused by the postmaster's knowledge that the receiving bank had failed, and the postmaster believed he was doing the forwarding bank a favor by returning the letter. Although a bank fails pending the forwarding of a letter containing a note, it is fair to presume that its business, in the way of presenting notes for payment, will continue, and the failure of such bank, although causing some fifteen days' delay in the presenting of a note, does not release the endorser.

2. CERTIFICATE OF NOTARY-MEANING OF "MAILED."-It is not necessary to prove that the postage was

prepaid on a notice sent by mail of the dishonor of a note. When the notary swears that a notice was "mailed," it covers all the requisites of notice.

3. IT SEEMS THAT THE SUPREME COURT will review the evidence on the question as to what constitutes due diligence under the law merchant.

From the St. Louis Circuit Court:

Botsford & Williams and Fisher & Powell, for plaintiffs in error; Slayback & Heussler, for defendants in error.

HOUGH, J., delivered the opinion of the court: This was an action brought by the plaintiffs, as holders of a negotiable promissory note, against the defendants, as indorsers thereof. The questions presented for determination are, whether the plaintiffs used due diligence in making demand of payment, and gave the requisite notice of nonpayment to the defendants.

The facts are as follows: The note in question matured on the 4th day of July, 1861, and was payable at the banking house of F. & G. Willins, in the city of St. Paul, Minnesota. Some time in April, 1861, the plaintiffs delivered the same to the Bank of Cooperstown, at Cooperstown, New York, for collection. At that time a letter, in due course of mail, would reach St. Paul, from Cooperstown, in about six days. The cashier of the Bank of Cooperstown sent the note by mail to its regular correspondent, the Bank of St. Paul, in the city of St. Paul, for collection. in ample time, as the cashier stated, for it to reach its destination by ordinary course of mail, before the maturity of the note. When the letter reached St. Paul, the Bank of St. Paul had made an assignment, and the envelope having printed on it the words 'From the Bank of Cooperstown,' the post master at once returned it to the Bank of Cooperstown, with the indorsement 'Bank failed.' The letter was received by the Cooperstown Bank in the original envelope, unopened, on the 9th day of July, 1861, and on the same day the note was returned by mail to St. Paul, in a letter directed to F. & G. Willins, who caused it to be presented and protested on the 15th day of July, 1861, the day on which it was received. The defendants contend that there was a want of diligence in not sending the note in time to guard against such contingencies as the evidence discloses, and that the action of the post master in the premises is no sufficient excuse for the failure to present for payment on the day of the maturity of the note.

Professor Parsons, in his treatise on Notes and Bills, says: "Ordinarily any failure to present a note at the proper time, by reason of the negligence of an agent, would discharge an indorser, but where the holder makes use of the public mail for the purpose of transmitting the note to the proper place in season to have a legal demand made, and without any negligence on his part, we should say that he would not lose his remedy on an indorser, if through any accident or disorder, or the negligence or mistake of the post office clerks, the note does not reach the destined place in season to make demand on the very day of maturity." Vol. I, p. 461. In support of his text he cites the case of

Windham Bank v. Norton, Converse & Co., 22 Conn. 213, the leading features of which bear such a striking resemblance to the case at bar, that we think it proper to present them.

The

The draft in that case was drawn upon and accepted by Mansfield, Hall & Stone, of Philadelphia, payable at the Farmers' and Mechanics' Bank, in said city, on the 2d day of June, 1849, and was indorsed by the defendants to the plaintiffs in the month of February, 1849. During the same month the bill was indorsed and delivered to the Ohio Life and Trust Co., a banking corporation, in the city of New York, for collection. At that time there were two mails per day from New York to Philadelphia: one leaving at 9 A. M. and one at 4 P. M., both of which were due at Philadelphia five hours after their departure. The Farmers' and Mechanics' Bank was the Philadel-. phia correspondent of the Ohio Life and Trust Co. On the morning of June 1st, the cashier of the Ohio Life and Trust Co. inclosed this draft, with others, properly addressed to the Farmers' and Mechanics' Bank, and deposited said letter in the post office at the city of New York, in time for the afternoon mail, of that day, for Philadelphia. This mail arrived at Philadelphia in due time, but the mail bags containing the letters for Philadelphia were by the post office clerks in New York marked to be forwarded to Washington, and were therefore carried to the latter place. mistake was discovered at Washington, and the mail returned to Philadelphia, reaching there on the 3d of June, and on the next day, June 4th, payment was demanded and refused, protest made and notice given. In discussing the question of negligence, or reasonable diligence, the court said: "The only remaining inquiry is, whether the plaintiffs are chargeable with negligence for not forwarding the draft in question, by an earlier mail from New York to Philadelphia. It was sent by the usual legal and proper mode. It was deposited in the post office in season to reach the place where it was payable, before it fell due, by the regular course of the next mail, and there was no reason to believe that it would not be there duly delivered. It was actually sent by that mail, and, but for the mistake of the postmaster where it was mailed, in misdirecting the package containing it, would have reached its proper destination, and been received there in season for its presentment when due. It in fact reached that place, when it should have done, but was carried beyond it, in consequence of that mistake. As that mistake could not have been foreseen or apprehended by the plaintiffs, it is not reasonable to require them to take any steps to guard against it. Indeed they could not have done so, as they had no control or supervision over the postmaster. They had a right to presume that the latter had done his duty. They could not know that he had misdirected the package, until it was too late to remedy the consequences. The occurrence of the draft being sent beyond its place of destination, was, therefore, so far as the plaintiffs were concerned, an unavoidable accident."

We have been referred by defendants' counsel

to the case of Schofield v. Bayard, 3 Wend. 488, as being in direct conflict with the case just cited from Connecticut; but a careful examination of the facts in Schofield v. Bayard will show that there is no conflict whatever between the two cases. The latter case contains an element of negligence on the part of the holder, which was absent from the case of Bank v. Norton, and which is wanting in the case at bar. The facts were, that a bill drawn by a firm in New York on a house in Liverpool was accepted supra protest, by a house in London. The bill was sent by the holder, who resided in Birmingham, to Liverpool for payment, instead of London, where it was payable. The holder's correspondent at Liverpool returned the bill in a letter to the holder with advice that the presentation should be made in London, and the letter was put in the post office, but by some oversight of the clerks in the post office it did not get to Birmingham in time for the holder to forward it to London and have a regular demand made. It was held that the drawers were discharged. The court said: " This case presents no impossibility, if due diligence had been used. The plaintiff should not have sent the bill to Liverpool at all. It is true that after the letter containing it had been left at Liverpool, on the 10th of November, it could not have reached London in season; but it was the fault of the plaintiffs to have parted with the bill in the manner they did. Instead of sending it to Liverpool, they should have sent it to London, and then it would have been in season, and probably would have been paid. I am of the opinion that, by the law merchant, payment should have been demanded in London on the 12th of November; and that not having been done, and there being no impossibility to prevent it but what is attributable to the want of due diligence on the part of the holders, the defendants are legally discharged, and are entitled to judgment."

It will be seen that the court places its judgment expressly upon the ground that the holder was guilty of negligence in sending the bill to Liverpool, and this fault of his produced the impossibility by virtue of which he claimed to be discharged.

In the present case the letter containing the note was not misdirected; it was properly directed; it actually reached St. Paul in time, and but for its unauthorized return by the postmaster, the probabilities are that some agent or representative of the suspended bank would have received it in time to make due presentment, as the testimony tends to show that the representatives of the bank continued to receive letters addressed to it, after its suspension. The holders therefore exercised due diligence in sending the note where they did; its arrival in time demonstrates that fact; and they were not required to make provision in advance for a possible, but unanticipated suspension of the Bank of St. Paul before arrival of their letter, or for an unwarrantable interference with the same by the public officer in charge of the mails, after its arrival. We are of the opinion, therefore, that under the circumstances of this case, the demand was reasonably made.

Objection is also made to the notice which was given by the notary. The certificate of protest is as follows:

"Due notice of the foregoing presentment, demand, refusal, and protest were put into the postoffice at St. Paul, as aforesaid, and directed as follows:

"Notice for Katharina Ambs, directed St. Louis,

Mo.

Notice for W. & R. Heinrichshofen, directed St. Louis, Mo."

And the notary testified: "I personally mailed such notices in the post-office on the 15th day of July, A. D. 1861."

The objection is that he did not say that he had prepaid the postage; and the court instructed the jury that this was necessary. This objection is rather hypercritical. The word mailed, as applied to a letter, means that the letter was properly prepared for the transmission by the servants of the postal department, and that it was put in the custody of the officer charged with the duty of forwarding the mail. Indeed, the words put into the post-office, as used by the rotary, have a technical significance which is well defined; and they are commonly employed to designate the duty of the holder in giving notice. Since the enactment of the laws requiring all mail matter to be prepaid, these words have been used by this court in the sense of mailed. Renshaw v. Triplett, 23 Mo. 220; Sanderson v. Reinstedler, 31 Mo. 485.

In Story on Promissory Notes, § 328, ed. 1859, it is said: "All that the law requires of the holder is due diligence to send the notice within the proper time; and he has done his whole duty when he puts it into the proper post-office in due season, and it is properly directed. The holder has no control over the acts, or operations, or conduct of the officers of the post-office, and is not responsible for the accident or neglect which may prevent a due delivery of the notice to the party entitled to notice."

It sufficiently appears in the present case that the notice was properly directed. The evident and only meaning of the notary's certificate is that the notice was mailed to the defendants at St. Louis, Mo. The judgment will be reversed, and the cause remanded. All concur.

COMMON CARRIERS-CONTRACT-ULTRA

VIRES-ESTOPPEL.

OHIO & MISSISSIPPI R. R. v. MCCARTY.

Supreme Court of the United States-October Term, 1877.

1. RAILWAY COMPANY-CONTRACT FOR TRANSPORTATION OVER CONNECTING LINES. -Where a railroad company contracted to carry certain cattle from East St. Louis to Philadelphia, in which contract no other company was named, nor was anything said concerning a change to the cars of any other company: Held, that, not being forbidden by its charter, the company had power to contract for shipments over other lines, and would be liable in all respects upon the other lines as upon its own line.