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it to his use; and generally, " when there is no trust to execute except that of paying over money to the cestui que trust, the trustee by his conduct, as for instance by admission that he has money to be paid over, or by settling accounts on that footing, may, and often does, make himself liable to an action at law at the suit of the cestui que trust, for money had and received, or for money due on account stated. Such was the case of Roper v. Holland (m), and there are many others to the same

effect. But so long as there is no liability except as the trustee, the cestui que trust has no legal remedy” (n).

In these cases the trustee is sued law, if at all, not as a trustee but as a debtor (o).

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SUBORDINATE RULE.

Subordi. Where one person has a legal and another an equitable nate rule.

Person interest in the same property, any action in respect must bring of such property must be brought by the person who action who

has legal has the legal interest.

interest,

and not It often happens that one person is legally and another person who

has equiequitably interested in the same property, as where table inA. has assigned his interest in a contract to B. (p). Actions with regard to such property must be brought by or rather in the name of A., and not of B. (9).

Moreover, the courts of law look in strict theory only to the parties on the record, i.e., to the parties whose names appear on the pleadings, and “a

"a cause must always be decided as if the parties on the record were

terest.

66

(m) 3 d. & E. 99.
(n) Pardoe v. Price, 16 M. & W. 458, 459, per Rolfe, B.
(0) Broom, Parties, 2nd ed., 109; Bullen, Pleadings, 3rd ed., 46, 47.

(p) Castelli v. Boddington, 1 E. & B. 66, ; 22 L. J. 5 Q. B. ; 1 E. & B.
879 ; 23 L. J. 31, Q. B. (Ex. Ch.).

(q) When a mortgagor is in possession, he may indeed bring actions of trespass for interference with his right to possession ; but he then sues, not in virtue of owning the land, but simply in virtue of being in possession, on which ground a tenant may always bring trespass. Conf. as to Ejectment, Chapter XXXIII.

cause.

the persons really interested ” (r). Hence, where A. sues as trustee for B., or in other words B. brings an action in A.'s name, though the action be in reality wholly for the benefit of B., A. being the party on the record cannot be looked upon as a mere cipher, and B: will be bound by A.'s acts and admissions, and liable to defences good as against A. (s). For “the plaintiff, though he says that he is a trustee of another, must, in a court of law, be treated in all respects as the party in the

If there is a defence against him, there is a defence against the cestui que trust who uses his name (t). The following instance shows the strictness with which the party on the record is in some cases treated as the real party to the suit.

The Statute of Frauds requires that a contract for the sale of goods should be signed by the party to be charged or his agent. It is also settled on this statute that one contracting party cannot sign as agent for the other. An auctioneer signed as agent for the party to be charged, i.e., the purchaser of the goods. His signature was in itself sufficient, but the purchaser was sued for the price, not in the name of the vendor but in that of the auctioneer (u), who of course sued for the benefit of the vendor. It was held that in such an action the contract could not be considered signed by an agent of the defendant's, since it was signed by the plaintiff, who must be treated as a party to the contract.

The general principle of the courts of law is to disregard equitable interests. A defendant may have an answer to a plaintiff's claim, which is perfectly good in a court of equity, and yet cannot be made in a court of law, and a plaintiff who could completely dispose of a

(r) Com. Dig., Action, B. 38; Bauerman v. Radenius, 2 Smith L. C., 6th ed., 362.

(s) The admission of equitable replications makes it now often possible for B. to dispose of such defences.

(1) Gibson v. Winter, 5 B. & Ad. 102.
(u) Farebrother v. Simmons, 5 B. & Ald. 33, and see Chapter V.

common law courts

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interests.

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defendant's answer to his case in a court of equity, may
not be able to reply to it in an action at law; but the
application of this principle has by degrees been modified.

Independently of statute the common law courts are Where often compelled to recognise the rules of equity.

Thus, if an action be brought by a vendee for the recognise dleposit, the Court will inquire whether the vendor's title equitable Iwould be good in equity. So, as the right of a person who has insured a ship and then sold it before loss, to sue upon the policy, depends upon the question whether or not he sues as a trustee for the vendee, such a person would not be allowed to recover in an action unless he is suing as a trustee (x). In cases turning on the bankcuptcy laws it frequently becomes necessary to take equitable as well as legal rights into consideration. If, for example, the bankruptcy of the plaintiff is pleaded, it is a good reply, independently of the statute allowing iequitable replications, that the plaintiff is suing merely as a trustee (y), since those things only pass to a trustee in bankruptcy in which the bankrupt is beneficially interested (2). Statutes have still further extended the recognition of equitable interests, and in so far have broken in upon the rule that the courts look only to the parties on the record.

The Common Law Procedure Act, 1854, enacts that (a) 17 & 18 V. “it shall be lawful for the defendant or plaintiff in re

c. 125,

s. 83, 85. plevin in any cause in any of the superior courts in which, if judgment were obtained, he would be entitled to relief against such judgment on equitable grounds, to plead the facts which entitle him to such relief by way of defence, and the said courts are hereby empowered to receive such defence by way of plea ” (b), and that “the

(2) Powles v. Innes, 11 M. & W. 10.

(y) Sims v. Thomas, 12 A. & E. 535 ; Boyd v. Mangles, 16 M. & W. 337 ; Parnham v. Hurst, 8 M. & W. 743 ; D'Arnay v. Chesncau, 13 M. & W. 796.

(z) See Chapter IX.

(a) C. L. P. A., 1854, ss. 83, 85. See, also, Policies of Assurance Act, 1867 (30 & 31 Vict. c. 144).

(6) C. L. P. A., 1854, s. 83.

plaintiff may reply, in answer to any plea of the defendant, facts which avoid such plea upon equitable grounds ” (c).

Many defences may now be pleaded which could not, before the statute, have been raised at common law. Thus, where a defendant has been made liable only by the occurrence of some mistake (d); where & person who is a surety does not appear to be so on the face of the instrument (e), and in other cases, defences, can be raised which would not formerly have been available in an action. The rights, again, and liabilities of assignees of debts who must sue in the name of their assignors, can now often be made to appear on the pleadings, and hence the rule, that each case must be decided as if the parties on the record were the only persons interested, often fails to hold good. This effect of the admission of equitable pleas, &c., is most clearly seen in the rules as to

Set-off.--A defendant sued for a "debt" due to the plaintiff may set off debts due from the plaintiff to a trustee for the defendant (f); and a debt due to the defendant from the person on whose behalf the plaintiff is suing as trustee (g). But the defendant cannot set off debts due from the plaintiff where the latter is suing as trustee for a person to whom he has assigned the debt for which he is suing, and the set-off has accrued due subsequently to notice of the assignment, and in respect of an independent transaction. Such a set-off may be met by a replication that the plaintiff is suing on behalf of the assignee of the debt (h).

The effect, therefore, on the right of set-off of admit

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Effect on set-off.

(c) Common Law Procedure Act, 1854, s. 85.

(d) Wake v. Harrop, 1 H. & C. 202; 30 L. J. 273, Ex. ; Steele v. Haddock, 10 Ex. 643 ; 24 L. J. 78, Ex.

(e) Pooley v. Harradine, 7 E. & B. 431 ; 26 L. J. 156, Q. B.
(f) Cochrane v. Green, 9 C. B., N. S., 448; 30 L. J. 97, C. P.

(9) Agra and Masterman's Bank v. Leighton, L. R. 2 Ex. 56 ; 36 L. J. 33, Ex.

(h) Watson v. Mid-Wales Rail. Co., L. R. 2 C. P. 593; 36 L. J. 285, C. P.

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ting equitable pleas is in an action by A. against X. for
a debt as follows:

X. may set off against the claim of A. a debt due from
A., not to X., but to M., a trustee for X.

X. may set off against the claim of A. a debt due to
X., not from A., but from M. (the real plaintiff) on
whose behalf A. is suing.

X. may not set off a debt due to him from A. if A.

really suing on behalf of M. when the set-off ail- has become due subsequently to notice given to X. of

of the assignment, and in respect of an independent trans-
eir action.
ht But X. may set off against the claim of A. (even
be though A. is suing as trustee for M.) debts due from A.
fo

X. which have become due before notice of an **

assignment to M. of the debt for which the action is s brought (i).

From the words of the Common Law Procedure Act, Limitations 1854, it might be inferred that any defence or answer

on right

to raise which is available in a court of equity could be pleaded equitable in an action. But this is not so; for the right to

defences. use equitable pleas, replications, &c., is subject to the following restrictions :

First. Courts of law will allow pleadings upon equitable grounds only where by the judgment at law they can do complete and final justice, and settle all the equities between the parties; they have no jurisdiction to pronounce a temporary or conditional judgment, and no process by which terms or conditions can be enforced. Accordingly, they will allow a pleading on equitable grounds only where a court of equity under similar circumstances would decree an absolute unconditional and perpetual injunction (k); that is, where a judgment in

(i) Cavendish v. Geaves, 24 Beav. 163; 27 L. J. 314, Ch.

(k) Bullen, Pleadings, 3rd ed., 568; Wodehouse v. Parebrother, 5 E. & B. 277 ; 25 L. J. 18, Q. B. ; Mines Royal Society v. Magnay, 10 Ex. 489 ; 24 L. J. 7, Ex. ; Jeff's v. Day, L. R. 1 Q. B. 372 ; 35 L. J. 99, Q. B.

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