Olcott v.Tioga Rail Road

J. C. Smith, J.

I concur in the result expressed in the opinion delivered by Justice Johnson in this case, while I dissent from a portion of his reasoning in respect to the question whether the mortgagee should account for the value of the mortgaged property instead of the sum bid by him therefor. As the mortgagee took a conveyance with a power of sale, I think he is to be regarded as a trustee for sale, (Jickling’s Anal. 67, note; Downes v. Grazebrook, 3 Mer. 200,) and as such he would be disabled from purchasing, were it not for the fact that being interested to the amount of his mortgage, he is also a cestun que trust, and should be permitted to purchase in order to avoid a loss to himself by a sale to another at a less price. It may well be doubted whether the rule of equity against a trustee’s purchasing the subject matter of his trust, can ever apply where the trustee stands in the relation of cestui que trust also.

Judgment affirmed, (a)

Johnson, Welles and J. C. Smith, Justices.]

Decision affirmed by the Court of Appeals, September, 1863.