Horton v. Maine ( 1900 )

The exceptions which are in part the basis of the petition for a new trial raise the question whether the guardian of a person can exercise the power of sale contained in a mortgage to the guardian, executed by the ward prior to the guardianship, and purchase the mortgaged property at the sale. We think the question must be answered in the negative. The interests of a mortgagee are adverse to those of the mortgagor, and hence when the mortgagee is appointed guardian to that the mortgagor his relation as guardian is adverse to that as mortgagee. His duty as guardian is to see that the power of sale in the mortgage is fairly exercised and that the mortgaged estate is not sacrificed. To permit a mortgagee to exercise the power of sale in a mortgage given by the ward before the guardianship would deprive the estate of the ward of the very protection which it is the purpose of the guardianship to afford, while at the same time a temptation might be presented to the mortgagee to conduct the sale in his own interest rather than in the interest of the ward and to purchase the property at a sacrifice, directly or indirectly, for his own benefit. Such a liability the law will not tolerate, and therefore it does not permit the same person to occupy two antagonistic relations from which a possible conflict of duty may arise, and will not stop to consider whether or not a sale in Shell circumstances in a particular instance is fair or otherwise. Perkins v. Se Ipsam, 11 R.I. 270; Spelman v.Terry, 8 Hun. 205; Rogers v. Rogers, 3 Wend. 503;Froneberger v. Lewis, 79 N.C. 426; Jamison v. Glascock, 29 Mo. 191; Tennant v. Trenchard, L.R. 4 Ch. App. 537.

The statute, Pub. Laws R.I. cap. 1011, in force when the sale was made, relaxed the rule that a trustee cannot purchase at his own sale so far as to permit a mortgagee to bid on and purchase the mortgaged property in a sale thereof in good faith under the power in a mortgage by giving to the mortgagor due notice of his intention, so that the mortgagor may be prepared to protect his interests under the sale. The modification of the rule ought not to be extended to a case like the present, in which the mortgagor is under guardianship and his guardian is the mortgagee. Galvin v. Newton, 19 R.I. 176, 178, 179.

New trial granted, and case remitted to the Common Pleas Division for further proceedings.