Opinion.

one-half of this lot of ground, unless the grantee therein had actual notice of the deed of January 7th, 1860.

And it is important to consider the evidence concerning the connection of Arthur Baugh with the deed of January, 1860, in which he was grantee and trustee.

In the first place, the said grantee was the father of the grantor in the said deed, living in the same town, and the objects of the trust were meritorious.

The same attorney wrote the deed from John Baugh to Arthur Baugh, as trustee; and the deed from said grantor to the said grantee for one-half the same property.

Arthur Baugh seems to have taken possession of the property before the execution of the deed of August 22d, 1863, and to have held it continually until his death. In the year 1862, before the execution of the deed to him for one-half, he proclaimed to the witness again that in his dealing with this property he was acting under the sanction of a trust for his granddaughter, the only child of John Baugh, and that he felt under strong obligations therefore to do the best with the property. In September, 1860, he informed his tenant of this very property that he was acting as trustee for his grandchild, and felt obliged to rent out the property at public auction, to do the best for her, and to save himself harmless, in the view of future responsibility, and actually advertised the property at public auction, as trustee for this grandchild. He had occasion to bring suit for the possession of this property against his tenant in 1862, and the summons is by Austin Baugh, trustee for D. W. Baugh (the granddaughter). In addition, while Arthur Baugh made no delay to record the deed from his son, John Baugh, to him for one-half of the lot, he held possession of the deed from Wilson, conveying the legal title to said John Baugh in this lot, from April 3d, 1861, and withheld the same from record as long as he lived. Why did he withhold this deed for so many years? He must have had some motive. We have seen his expressions of devo

Opinion.

tion to his granddaughter's interests, and his desire to save himself harmless at the same time. To put this deed to record may have appeared against interest, to him, as he, perhaps, knew that when it was put to record, if during his life, or his son's life, knowledge of and actual notice of the deed of January 7th, 1860, might, and would be proved, and thus the benefit of the deed of April 3d, 1861, would accrue solely to his granddaughter. And so this deed of April 3d, 1861, was withheld from record by him during his lifetime, and was by his executor, and son, W. A. Baugh, withheld from record after his death, until the 29th day of July, 1879, eighteen years after its execution, and when we come to look for the exciting cause which brought about this recordation at this late day, we see that on the twenty-third day of July, 1879, the same month, and just six days before, another deed had been put to record by the original grantor, Nathaniel Wilson, conveying this property to the beneficiary in the first deed of January 7th, 1860, the granddaughter, who had grown to womanhood and had married, and who came of full age July 23, 1879.

This deed of July 23d, 1879, from Nathaniel Wilson, was ineffectual to pass any estate, as the grantor had already parted with the legal title to John Baugh, but the deed of April 3d, 1861, having been now recorded, the grant therein accrued for the benefit of the beneficiaries under the deed of January 7th, 1860; and the deed of August 22d, 1863, was ineffectual to pass any estate to the grantee therein, the grantor in the same, having previously, with full notice to grantee therein, parted with his interest in said property. On the first day of August, 1879, a few days after the recordation of the last mentioned deed, D. W. Flynn, who was D. W. Baugh, and her husband, W. S. Flynn, made a deed to one James M. Walker, and Walker, finding the appellant in possession of the property, as the lessee of Arthur Baugh, sued said appellant in ejectment, and recovered the said property; the court having, by argument of all the VOL. LXXVII-13

Opinion.

parties, tried the case, and judgment was given in favor of said Walker, the appellee. Upon the facts of this case, and for the reasons already stated, we are of opinion that there was no error in the said judgment of the said hustings court of Danville, and the same is affirmed.

JUDGMENT AFFIRMED.

Syllabus.

Bichmond.

BAUGH'S EX'OR V. WALKER.

February 1st, 1883.

1. FIDUCIARIES.—Under no circumstances will a fiduciary be allowed to derive any personal benefit from his transaction of the trust business or management of the trust assets. And if a trustee purchase claims or encumbrances against the trust estate at a discount, the purchase shall enure to the benefit of the interest which it is his duty to protect.

2. IDEM.-Reimbursement.—But though the profit belongs to the cestui que trust, yet the fiduciary is entitled to be reimbursed the amount he has expended, with interest.

3. CASE AT BAR.-In 1859, of N. W., a lot was bought by J. B., who paid all the price except $900.87, but received then no conveyance. In 1860, J. B. conveyed it to A. B. in trust for himself and wife and survivor during life, remainder to their child. The deed was not acknowledged or certified according to law, though recorded, and A. B. knew of it and held possession under it. In 1861, N. W. conveyed the lot to J. B. but retained a lien. By deed dated 1862, but not signed until 1863, J. B. conveyed absolutely to A. B. one-half the lot, in consideration of A. B.'s paying off the lien. J. B. and wife died, leaving one child, D. F., wife of W. F.; A. B. also died and his executor rented the lot to R. In 1879, N. W. conveyed the same lot to D. F., who, with her husband, conveyed it, together with all moneys due her from A. B.'s estate by reason of his trusteeship, or by reason of the rents and profits received by said trustee on account of said lot, to J. M. W., who, having already brought ejectment against R. for the lot, brought his bill in chancery to settle the accounts of A. B. as said trustee. Accounts of receipts and disbursements having been taken and reported, the trustee was charged with the rents received after the death of J. B., and credited with the amounts paid out by him on the trust account, including the amount paid by him in purchasing the said vendor's lien of $900.87, which, having been paid

Syllabus-Statement—Opinion.

in Confederate money, was scaled as of its value at the time it was paid. The report being excepted to by the executor;

HELD:

1. Though the trust deed from J. B. to A. B., trustee, was not duly recorded, yet between the parties thereto, it was valid; and A. B. having actual knowledge of it, the deed of J. B. conveying to him one-half of said lot, was inoperative, except as to J. B.'s life interest therein. A. B. having acted as trustee under the trust deed, is bound for his receipts, and is entitled to be reimbursed for his outlays as such trustee; and having paid out Confederate money to relieve the trust estate of the vendor's lien, is entitled to have the same reimbursed at its value at the time when paid, with its interest.

2. D. F, being entitled to the trust corpus and the profits arising therefrom, J. M. W., the grantee of herself and husband, is also entitled thereto.

Appeal from decree of corporation court of the town of Danville, rendered November 1st, 1880, in the suit of James M. Walker, plaintiff, against William A. Baugh, executor of Arthur Baugh, deceased. The only question involved in this case, which is not involved in the case of Raines v. Walker (supra, p. 92), is the settlement of the rents of the property, the title to which is litigated in that case. The decree having been adverse to the executor, he appealed to this court. The opinion states the facts.

Guy & Gilliam, for the appellant.

W. W. Henry, for the appellee.

LACY, J., delivered the opinion of the court.

James M. Walker filed his bill in chancery in the corporation court of Danville, September, 1879, against William S. Flynn and D. W. Flynn, his wife, and William A. Baugh, executor of Arthur Baugh, deceased, setting forth that in August,