McKee v. Griggs. velt, county clerk, for his fees, "searching title Mrs. McKee." On January 20th, 1881, the deed from the sheriff to Shaw and the mortgage from Shaw to the Mutual Life Insurance Company were put upon record. Mr. Shaw placed the property in the hands of Mr. Eckings, as his real estate agent, but Mrs. McKee continued to reside in one of the houses up to the time of her death without the payment of rent. Mr. Shaw went to Europe somewhere about August 22d, 1881, and died there in November following. He was a widower with several children. He left a last will and testament, which was duly admitted to probate in Passaic county, containing the following provision : "I give, devise and bequeath unto J. W. Griggs and Henry L. Butler of Paterson, New Jersey, and to their heirs and assigns forever, all my real and personal estate of whatsoever description and wheresoever situated to be by them or the survivor of them, held upon the following trusts," specifying the particular trusts, the same being for the benefit of his children. Mrs. McKee died at her residence in Paterson, in December of the same year, leaving her surviving, her husband and her children, the complainants, Annie McKee, Minnie, who has intermarried with Edward W. Champion, James McKee, Jr., and Joseph McKee, the two latter being infants. James McKee, the father, by deed dated November 24th, 1890, released to the complainants all his interest in the said lands. The defendants, soon after the death of Mr. Shaw, took possession of the property and continue in possession thereof. The bill, which is filed by the complainants, as heirs-at-law of Mary Ann McKee, and as assignees of James McKee, alleges that when Robert Adams purchased the Harbeck mortgage and entered into the agreement named, his sole object was the befriending of James and Mary Ann McKee, without the design or intention to make any profit therefrom, and that he only required to be secured, and agreed, if James or Mary Ann McKee would pay the $3,000 and interest, for which he was obligated to Harbeck, and save him harmless on his bond, he McKee v. Griggs. would deliver up the mortgage for $5,700, on which there was, under the settlement, only $3,000 due. It further alleges that for a long time prior to June 9th, 1879, and up to his death, John Shaw and Mary Ann McKee were on terms of very great intimacy, and had maintained most friendly relations for years; that she looked to him for advice on all matters of business and placed implicit confidence in him. That when she was notified by Adams that she must pay the money or he would commence suit, she applied to her friend and confidential adviser, John Shaw, to assist her in her difficulty, and to aid her and devise ways and means for the redemption of the mortgaged premises, or some part thereof; that finally an agreement was made between her and Mr. Shaw with reference to the property by which he was to take the title, a part of it in his own name, and raise money on the security thereof, advancing what might be necessary to pay off the encumbrances, and should hold the said lands in his own name and enjoy the rents and profits until such time as the rents and profits should, with the interest thereon, equal the sum advanced by Shaw with interest, or until Mrs. McKee, her heirs or assigns, should redeem. That it was distinctly understood between Mrs. McKee and Adams that she should have time to redeem Plots Nos. 2 and 3, after applying the proceeds of the sale of No. 1 to the payment of the amount advanced by him to Harbeck, and that, relying on this, they did not attend the sale nor secure the attendance of others, but permitted Adams to buy at grossly inadequate prices ; that it was not intended by the McKees, or by Shaw, or by Adams that the sheriff's sale should be an absolute one, but that it was expressly agreed that Mrs. McKee should be at liberty to redeem the property, and that in this way the title was obtained at a grossly inadequate price; claiming that the conveyance should be held to be only a mortgage to secure the amount advanced, and charging that Shaw held the land subject to the right of redemption which he always recognized in his lifetime; that Shaw held the title subject to the $7,000 mortgage, having advanced only $1,046.46; that the agreement was intended to be reduced to writing, but that was never done, and it prays that the deed McKee v. Griggs. from the sheriff to Shaw may be declared to be a mortgage, to secure the money advanced by him in respect to the premises, and redeemable according to the agreement, and for an account, and that the complainants may redeem, offering to pay what may be due, or that the property should be sold and the equities adjusted. It is quite clear that no recovery can be based upon the parol agreement alleged to have been made by Mary Ann McKee with the testator of defendants. It admittedly rests in parol, and the answer denies that such agreement was made. There is no fraud alleged in the case, and in this aspect the act of the defendants would simply amount to a refusal on their part to carry out the oral agreement of the testator, John Shaw. Judge Dodd, in Wakeman v. Dodd, 12 C. E. Gr. 564, says: "Where the case is free from fraud, and the wrong on the part of the defendant consists solely in refusal to do what he agreed, an answer denying the agreement is a good answer to the bill. The bar to the complainant's suit is then complete, because no proof of the parol agreement can then be admitted, such proof being illegal by the statute." In Walker v. Hill's Exrs., 7 C. E. Gr. 513, Judge Depue (at p. 519) says: "The defendants having denied the existence of any agreement whatever with respect to the purchase of the land, are entitled to the benefit of the statute of frauds without pleading it as a defence. The effect of a total denial of any contract is to put the complainant to proof of the trust by legal and competent evidence, which by the statute is required to be in writing. * * * The jurisdiction over transactions of this nature rests on the ground of fraud and oppression on the part of the purchaser, by means of which he has obtained the property of the debtor at an inadequate price, under the assurance of a contract to reconvey the property to him, or to hold the same subject to future redemption." Recovery must therefore be had, if at all, upon the other aspect of the case which is presented, namely, that John Shaw stood in a fiduciary relation to Mary Ann McKee, and in such McKee v. Griggs. relation acquired the title to the premises under such circumstances that it would be inequitable for him to retain it. In the case of Wakeman v. Dodd, above cited, the same learned judge before quoted from says (at p. 567): "While the imputation of intentional fraud may in this view be avoided, it is manifest from the evidence that the defendant was, at the time of the purchase, the complainant's confidential adviser. Standing in this fiduciary relation, the beneficial results of the purchase must be hers instead of his. The elementary principle of equity, by which a trustee is disabled to purchase for his own benefit the, property of his cestui que trust, is too plainly applicable to the facts of this case to leave room for controversy or doubt. Without reference to fraudulent intent, and irrespective of the parol contract alleged in the bill, the facts, as they are pleaded and proved, conclusively evince that, as to the property in question, the defendant was the complainant's adviser, and consequently, trustee. As such he must be held to account." Referring to the case of Fox v. Mackreth, and the accompanying notes in 1 White & T. Lead. Cas. 92–209. In Tate v. Williamson, L. R., 2 Ch. 55, Lord Chancellor Chelmsford (at p. 61) says: "The jurisdiction exercised by courts of equity over the dealings of persons standing in certain fiduciary relations has always been regarded as one of a most salutary description. The principles applicable to the more familiar relations of this character, have been long settled by many well-known decisions, but the courts have always been careful not to fetter this useful jurisdiction by defining the exact limits of its exercise. Whenever two persons stand in such a relation that, while it continues, confidence is necessarily reposed by one, and the influence which naturally grows out of that confidence is possessed by the other, and this confidence is abused, or the influence is exerted to obtain an advantage at the expense of the confiding party, the person so availing himself of his position will not be permitted to retain the advantage, although the transaction could not have been impeached if no such confidential relation had existed." In Billage v. Southee, 9 Hare 534, Vice-Chancellor Sir George McKee v. Griggs. James Turner (at p. 540) says: "No part of the jurisdiction of the court is more useful than that which it exercises in watching and controlling transactions between persons standing in a relation of confidence to each other; and in my opinion, this part of the jurisdiction of the court cannot be too freely applied, either as to the persons between whom, or the circumstances in which it is applied. The jurisdiction is founded on the principle of correcting abuses of confidence, and I shall have no hesitation in saying it ought to be applied, whatever may be the nature of the confidence reposed, or the relation of the parties between whom it has subsisted. I take the principle to be one of universal application, and the cases in which the jurisdiction has been exercised-those of trustee and cestui que trust, guardian and ward, attorney and client, surgeon and patient-to be merely instances of the application of the principle." John Shaw was an Englishman, and Mary Ann McKee was of the same nationality. He was acquainted with her before her marriage to James McKee; their acquaintance was so intimate that they addressed one another by their Christian names; he was a frequent visitor at her residence, both before and after her marriage, and took great interest in her welfare, and expressed the same on several occasions. To understand the exact nature of the transaction now attacked it is necessary to examine the condition of Mrs. McKee's affairs from the date when Adams intervened in her behalf. There is no uncertainty with reference to the latter gentleman's positionhe came in as the friend of the McKees, to save, as he says, their property from foreclosure. The Harbeck mortgage was due and he was urgent for payment. James McKee, the husband of Mary Ann McKee, seems to have been an unthrifty person, engaged in horse transactions, following the trotting circuit, and, from all accounts, spending all the money he could obtain. His relations with his wife would seem to have been anything but pleasant, and resulted at last in their separation and the determination on her part to procure a divorce from him. These strained relations existed during the time of the transactions under review, and up to the serious illness of one of their chil |