The involvements of the contract are accentuated by the frequent use of the baffling symbol "and/or " — a disingenuous modernistic hybrid, inept and irritating.
Whether there was default by the glass companies in fulfillment of the contract of June 5, 1929, and whether, if there was such default, they are liable in damages to the gas company, and, if so, in what amount, are undoubtedly matters which should be determined in this cause upon remand to the trial court.
But without regard to the result of that inquiry, I am of opinion that the questions in respect of the first mortgage bonds of the gas company which have been purchased by the glass companies should be disposed of in conformity with the position urged on behalf of the gas company or its receivers. I am impressed that the contract and dealings between the gas company and the glass companies were such as to constitute a fiduciary relation. Confidence was reciprocal. The gas company spent large sums of money on the basis of that confidence, and when default on its bonds seemed imminent, June 1, 1932, full disclosure of that situation was made to the glass companies. Immediately after that disclosure the glass companies began secretly to purchase outstanding bonds of the gas company at far less than face value. Here is basis for a constructive trust. "A constructive trust arises not from *Page 299 agreement of parties, express or implied, but from the construction and operation of equity in order to satisfy the demands of justice." Power Co. v. Railroad Co., 113 W. Va. 20,166 S.E. 536. Consult 3 Pomeroy's Eq. Jur. (4th Ed.), secs. 1044, 1053.
Because of the general economic and industrial depression the glass companies did not need the full amount of gas contemplated by the contract of June 5, 1929. The contract had therefore become burdensome. With these facts noted, it is not to be presumed that the purchase of the bonds was unrelated to the bearing which their ownership would have on the contractual situation. But, whatever the purpose and motive, the glass companies did purchase about ninety-two per centum of the first mortgage bonds of the gas company. By purchasing these bonds, the glass companies presumably placed themselves in position to control the sale of the gas company's properties, and, incidentally, to get rid of the troublesome gas contract. Authority need not be cited for the basic equitable principle that a party to a fiduciary relationship may not acquire for his own benefit outstanding rights in the subject matter, antagonistic to another party associated in the trust relationship. Where such outstanding interests are thus acquired, equity requires that they be held for the benefit of all who are concerned in the confidential association.
Therefore, I am of opinion that the gas company or its receivers should be granted leave, in accordance with the prayer of the petition of the intervenors, to redeem the bonds by paying to the glass companies the amount paid by them for the bonds. Such amount should, of course, be credited with the amount of damages, if any, which shall be ascertained to be owing by the glass companies to the gas company on account of the alleged breach of the aforesaid contract of June, 1929. Upon such payment, less said credit, if any, the glass companies should be required to turn over the bonds to the gas company or its receivers, to the end that the gas company's properties may be relieved of forced sale under the mortgage securing the bonds.
So far as these observations are at variance with the decision, I dissent therefrom.
Judge Woods authorizes me to say that he concurs herein. *Page 300