dissenting. From my examination of the transcript I am of the opinion that the trial justice was clearly wrong in finding “that the trustees did not perform their -duties during the .twenty day period after the execution of the contract with Stevens, resulting in a probable failure to obtain a higher price for the Outlet stock.” No *474useful .purpose would foe served by a lengthy discussion here of the significant portions of the evidence upon which I base my opinion. Suffice it to- say that I have carefully perused the entire transcript and have found the evidence overwhelming to the effect that the trustees performed their duties with skill and prudence and with utmost good faith. That the special interest and desires of complainant Joseph Samuels Sinclair will not foe served by the proposed sale in no way detracts from the essential correctness of the conduct of the trustees in exercising the ample and virtually uncontrolled powers vested in them by the trust instruments.
It is clear from the record that Sinclair is claiming an interest which the trustees were not bound to serve. And while the sale of The Outlet Company stock at the higher price which he negotiated may possibly be more advantageous to him it is not clear that it would be equally advantageous to the trusts which the trustees are in duty bound to safeguard before catering to' the special desires of any particular beneficiary. Therefore I would hold that the trial justice erred in basing his decision upon the above-mentioned finding.
In compliance with that view, strict adherence to long-established principles of equity pleading in this state would normally result in the denial and dismssal of the bill of complaint, since the only grounds for relief alleged therein were those comprehended within that particular finding. However, the trial justice based his decision on a further ground dehors the bill. He states such ground in his re-script as follows: “* * * that the bank has 'brought about such a conflict of interests,, between itself individually and as trustee, of so substantial a nature as to prevent the exercise of its independent judgment as a trustee of the Sinclair trusts in determining upon a sale, and that the complainant Sinclair and his children as contingent beneficiaries will suffer some detriment * * There are in *475the decree no specific findings of facts upon which that conclusion is predicated. And there are no allegations of facts in the bill which would serve to point up. supposed breaches of loyalty on the part of all the trustees or of the bank alone. Indeed complainants’ brief is likewise not free from obscurity in this matter. Nor is the majority of this court in harmony as to' whence arises this conflict of interests 'and divided loyalty.
Ordinarily the absence from the bill of complaint of any allegations of such conflict and divided loyalty would preclude the introduction of evidence along that line. Evidence on matters not alleged in the bill is useless. And a decree in equity must rest ultimately on allegations therein. Dolan v. Dolan, 78 R. I. 12; Flynn v. Byrne, 82 R. I. 48; Dimond v. Barlow, 82 R. I. 399.
This is not a mere technical requirement but goes to the very heart of the matter of fair equity pleading. “We should contradict, in the most flagrant manner,” said Ames, C. J., “the just principle of equity practice which requires, for the purposes both of answer and proof, a fair conformity between the 'allegata’ and the 'probata,’ upon a bill for relief, if we should allow the complainants, because their proof fails them upon the ground alleged, to obtain relief upon any other ground, and especially upon any ground inconsistent with that.” Atlantic Fire & Marine Inc. Co. v. Wilson, Gall & Co., 5 R. I. 479, 488. It is generally held that material facts must be alleged to put them in issue, or relief cannot be granted even though the facts be proved. Harding v. Handy, 24 U. S. *103. And the examination of the case by the court is confined to the issues made by the pleadings. Rubber Co. v. Goodyear, 76 U. S. 788.
In the case at bar complainants did not allege in their bill any facts which if proved would raise the question of divided loyalty of the trustees in entering into the contract with Stevens for the sale of The Outlet Company stock. Nor did they, in presenting their case in chief, intro*476duce any evidence tending to prove such, issue. Apparently the idea of invoking the undivided loyalty rule did not occur to them until the trial justice suggested it by his interrogation of one of respondents’ witnesses. Thereafter in rebuttal complainants seized the opportunity to1 develop the idea by further inquiry but they did not move to amend their bill.
In this state of the pleadings evidence on the issue of divided loyalty was inadmissible and should have been disregarded at least until the complainants amended their bill by alleging certain facts which if proved would clearly show in what respect the trustees had involved themselves in a conflict of interests. As it is we 'are left in dou'bt concerning the precise nature of such conflict and the time when it arose. Even the above-quoted finding of the trial justice does not make those points clear.
However, the majority here apparently assume that it arose, as they state in the court’s opinion: “When the bank became pledgee of the stock it assumed a position with the beneficiaries of the Joseph Samuels trusts in which its interest as a bank was potentially antagonistic to its interest as a trustee.” In my opinion this is an untenable assumption. At the time Clare S. Quinn pledged her stock as partial security for her loan from the bank such stock was her absolute property which she could sell, pledge or otherwise dispose of as she pleased. It was not then part of the Leon Samuels trust and was not subject to any of the restrictions contained in the agreements of Joseph Samuels with Leon Samuels and later with Leon’s widow and Clare S. Quinn. By virtue of the consents previously obtained by Clare S. Quinn from the trustees, which consents they had the undoubted authority- to* give under the ample powers granted to them by the trust instruments, her stock became free of such restrictions. Of course it is urged in the briefs and argument of complainants that the giving of such consents by the trustees was in itself a breach of the *477undivided loyalty rule in that such consents favored Clare S. Quinn, one of the beneficiaries of the Leon Samuels trust, over the beneficiaries of the Joseph Samuels trusts. I think there is no merit in that contention.
If there was a conflict of interests because the bank was a trustee under both trusts it was one created by the settlors themselves. It is generally held that in such a situation the undivided loyalty rule does not apply. “By the terms of the trust, the trustee may be permitted to do what, in the absence of such provision in the trust instrument, would be a violation of his duty of loyalty; and within limitations, the trustee may be authorized by the trust instrument to act in matters involving a divided interest.” 90 C.J.S. Trusts §248(e), p. 269. Idem at page 270: “Also, where the trustee’s dual relationship with respect to trust property was created not by the trustee, but by the act of the settlor in appointing such person as trustee with knowledge of his other interest in the property, transactions engaged in by the trustee, acting with prudence and diligence, are not invalid.” For illustrations of this principle see In re Farrell’s Will, 91 N.Y.S.2d 89; Matter of Balfe, 245 App. Div. (N.Y.) 22; Rosencrans v. Fry, 12 N. J. 88; Flagg Estate, 365 Pa. 82; Steele Estate, 377 Pa. 250. Some of the facts in the last two cases bear a marked similarity to those in the case at bar.
In a situation such as exists here, while the court may not apply the undivided loyalty rule it should scrutinize the transaction complained of with extreme care in order to satisfy itself that the trustees in exercising the plenary power conferred upon them have acted in the utmost good faith toward all the beneficiaries. From my examination of the evidence I am fully satisfied that the trustees have not violated that standard. On the contrary I am convinced that in so far as its taking a pledge of the 5,250 shares as security for the loan to Clare S. Quinn is concerned the bank performed an important service for the *478benefit of all the beneficiaries. The uncontradicted testimony is to- the effect that the primary purpose of obtaining such pledge was to assure the continued control of The Outlet Company in the Joseph and Leon Samuels trusts thereby enabling the trustees to be in a commanding position to obtain the most advantageous terms in the event it was deemed advisable to sell the stock as a block in accordance with the provisions of the trust instruments.
Bruce O. Sundlun, John H. Chafee, Philip W. Amram, ■of Washington, D. C., Amram, Hahn & Sundlun, Washington, D. C., for complainant Joseph Samuels Sinclair. John H. Chafee, for complainant Bertha Samuels Sinclair. Ernest A. Jenckes, guardian ad litem. Hinckley, Allen, Salisbury & Parsons, for respondents Industrial National Bank of Providence and Walter F. Farrell, Trustees. Higgins, Cavanagh & Williamson, Joseph V. Cavanagh, amicus curiae.I have been constrained to' express at this length my reasons for dissenting from the majority because I am profoundly concerned, not to say disturbed, over the possibility that their opinion upholding the trial justice in his application of the undivided loyalty rule to the facts of this case will create confusion and doubt as to the proper administration by a trustee of multiple trusts. Under the view of the law that I have undertaken to expound here we would avoid that possibility and at the same time do justice and equity to all concerned in this litigation.
For the reasons above given I would reverse the decree appealed from .and dissolve the injunction as improvidently issued.