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against imputing knowledge previous- the rule that notice to the solicitor is ly acquired contain indications that notice to the client had been restrictthe rule rests upon a presumption of ed to the same transaction." And in the attorney having forgotten the another case 78 there is stated to be knowledge.75 The English cases are "no inflexible rule that the knowledge not agreed upon the question. As must, of necessity, have been acquired just shown, some of the English deci- in the same transaction.” Continuing, sions in which the rule is stated abso- the court states that "knowledge aclutely against imputing prior acquired quired by the agent in one transaction knowledge contain suggestions that it may, under certain circumstances, be might be otherwise if the attorney had held binding on the principal in a secremembered the previously acquired ond transaction.

If the notice knowledge, or if it was acquired so be so clearly proved that no one can shortly before the employment that he doubt that it was fraud in the agent must be presumed to have remembered to conceal it from his principal, it is it.76 It is expressly stated in one ground for holding it notice to the case 77 "that where one transaction principal.” The fraud mentioned here, was closely followed by and connected

being constructive, merely arising with another, or where it was clear, from nondisclosure of facts, should as in the case before the court, that a not be confused with the actual fraud previous transaction was present to discussed infra.79 Previously acquired the mind of the solicitor when engaged knowledge has been imputed to the in another transaction, there was no client in some of the English cases.80 ground for the distinction by which Where knowledge acquired by the at

75 In Warrick v. Warrick (1745) 3 itself, a sound one, but it must not be Atk. 291, 26 Eng. Reprint, 970, the carried too far.” court, after referring to the fact that Hargreaves v. Rothwell (1836) 1 the transaction with the client whom Keen, 154, 48 Eng. Reprint, 265, 5 L. J. it was sought to affect with notice oc- Ch. N. S. 118. curred a year and six months after the 78 Nixon v. Hamilton (1838) 1 Ir. attorney obtained knowledge sought Eq. Rep. 46, holding a mortgagee to be imputed, states that it is very chargeable with the knowledge of his probable that the attorney had forgot- solicitor of a prior unrecorded deed of ten it in this length of time.

settlement to the mortgaged land. See Edgecumbe v. Stranger (1837) Twycross v. Moore (1850) 13 Ir. Eq. 1 Jur. (Eng.) 400, supra.

Rep. 250, holding the cestui que trust 76 Thus, in Mountford v. Scott under a marriage settlement charge(1823) Turn. & R. 274, 37 Eng. Re- able with knowledge of the solicitor print, 1105, although the decision who prepared the settlement, of a priturned upon another ground, it is stat- or mortgage upon the property settled ed that it might be necessary to con- in trust, and this notwithstanding the sider "whether one transaction might solicitor was, as a trustee, the mortnot follow so close upon the other as gagee. It is proved in this case that to render it impossible to give a man the existence of the prior mortgage credit for having forgotten it. I was perfectly in the recollection of the should be unwilling to go so far as solicitor, because he had a conversato say that, if an attorney has notice tion in regard thereto, but it is stated of a transaction in the morning, he that, independent of this evidence, the shall be held in a court of equity to solicitor to whom the mortgage was have forgotten it in the evening; it made would be held to have notice of inust, in all cases, depend upon the the mortgage, and of the trust upon circumstances.”

it, being matters to which he was himIn Gerrard v. O'Reilly (1843) 3 Drury self a party, just as he would be held & War. (Ir.) 414, the court refers to to have had notice of any deed exthe rule that if a solicitor has notice ecuted by himself as a grantor; and, in the same transaction, or so recently consequently, through him the cestui that it is impossible to suppose he que trust would be affected with such could have forgotten it, then the client notice. will be chargeable with notice, and 79 See infra, VI. states: “The rule or principle is, in 80 Dalland v. Hart (1871) L. R. 6

4 A.L.R.–102.

torney previous to his employment is itors as accepted the benefit of the sought to be imputed to a client, it securities, knowledge of the attorney of has been stated that "the knowledge a prior unrecorded mortgage given by or notice must be of a matter so mate- the debtor, states that the attorney, rial to the transaction as to make it although retained by the debtor, was the agent's duty to communicate the employed in the interest of and acted fact to his principal.” 81 And it has for the creditors. Continuing, the been held that there must be clear court stated : "He performed not proof that the knowledge was present merely ministerial duties, but used to the mind of the attorney at the his professional skill and discretion in time of the second transaction; other- their behalf. To allow them the full wise, the client is not chargeable.82 benefit of his services, and at the same

Where an attorney who in fact has time relieve them from the legal effect no authority to act for a person as- of notice to him of the existence of the sumes such authority and takes a se- instrument he was seeking, in their incurity to such person, which the person terests to defeat, would be unjust, and afterwards accepts, it has been held in our opinion contrary to authority." that the act of the attorney in representing such person is ratified, and that VI. Attorney acting in his own interest, knowledge acquired by the attorney

or in fraud of his client. in the transaction is imputable to the An exception that is ingrafted upon client.83 In one case,84 in which an at- the general rule that knowledge of torney for a failing debtor took the an attorney is imputable to his client necessary legal steps to have judg- is that, where the attorney is acting in ments confessed and mortgages ex- his own interest, his knowledge will ecuted in favor of certain creditors, not be imputed to the client.85 Where the court, in imputing to such cred- knowledge acquired previous to the Ch. (Eng.) 678, 40 L. J. Ch. N. S. 701, accepted the benefits of such mort25 L. T. N. S. 191, 19 Week. Rep. 962. gages and securities.

And see preceding notes. And see 84 Haas V. Sternbach (Ill.) supra. generally, the cases supra, imputing 85 Scotch Lumber Co. v. Sage (1901) to a mortgagee knowledge of his so- 132 Ala, 598, 90 Am. St. Rep. 932, 32 licitor.

So. 607, holding notice not imputable, 81 Fairfield Sav. Bank Chase where the attorney was acting for (1881) 72 Me, 226, 39 Am. Rep. 319. both parties in a sale of land. The

82 Constant v. University of Roch- court states that he was personally ester (1889) 111 N. Y. 604, 2 L.R.A.

interested in the sale. 734, 7 Am. St. Rep. 769, 19 N. E. 631,

Hope F. Ins. Co. v. Cambreleng 2d appeal (1892) 133 N. Y. 640, 31 N. (1874) 3 Thomp. & C. (N. Y.) 495, E. 26, supra; Mathews v. Damainville holding the knowledge of a solicitor (1905) 100 App. Div. 311, 91 N. Y.

representing two clients, who borSupp. 524, supra.

rowed money from each of the clients, See Kirklin v. Atlas Sav. & L. Asso.

giving a mortgage upon his property, Tenn. (1900) 60 S. W. 149, in

of the mortgage given first, not to be

imputable to the client to whom he fra, 99. 83 Lampkin

gave the second mortgage, which was First Nat. Bank

first recorded. (1895) 96 Ga. 487, 23 S. E. 390, hold

Goodell v. Taylor (1916) N. J. ing knowledge of an attorney acquired

Eq. 97 Atl. 569, holding that noin taking mortgages from a failing

tice of a defect in title will not be debtor to be knowledge of the mort

imputed to a mortgagee, where the gagees who afterwards accepted the

attorney was the mortgagor. But see mortgages.

Mutual Bldg. & L. Asso.'s Case (1896) Haas v. Sternbach (1895) 156 Ill. 19 Pa. Co. Ct. 504, supra, note 69. 44, 41 N. E. 51, holding notice to an FLORENCE v. DE BEAUMONT (reportattorney for a failing debtor, of an un- ed herewith), ante, 1565. recorded mortgage given by the debt- Thompson v. Cartwright (1863) 2 or, imputable to creditors in whose De G. J. & S. 10, 46 Eng. Reprint, 277, favor mortgages were given and judg- 33 L. J. Ch. N. S. 234, 3 New Reports, ments confessed, and who afterwards 144, 9 Jur. N. S. 1215, 9 L. T. N. S.

v.

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employment is sought to be imputed of a previous lien upon the mortgaged to a client, it has been stated that "the premises. It was urged that the solicagent must himself have no personal itor had an interest not to commuinterest in the matter, which would nicate the fact of the previous lien. lead him to conceal the knowledge In answer to this, the court states: from his principal." 86 In another “But I will not lay down as a rule that case87 it is stated that “just as soon where a solicitor owes a duty on the as the agent forms the purpose of one side, and has an interest on the dealing with his principal's property other side, the presumption arises that for his own benefit and advantage, or he follows his interest and not his for the benefit and advantage of other duty. I shall, on the contrary, prepersons who are opposed in interest, sume that in this case he performed he ceases, in fact, to be an agent act- his duty, even although it was against ing in good faith for the interest of his interest." The court then states his principal, and his action there- that the mortgage would have be acafter, based upon such purpose, is cepted by the mortgagee even though deemed to be in fraud of the rights of he had known of the previous lien, but his principal, and the presumption adds: “I desire to put my decision that he has disclosed all the facts that mainly upon this, that, where there have come to his knowledge no longer is an interest and a duty, I shall not prevails." The application of this ex- presume that the solicitor will follow ception has been denied to a case in his interest and neglect his duty." which attorneys, acting for an insolv- It is the doctrine of some English ent debtor and several creditors, ob- cases that where the solicitor intendtained a mortgage to secure the cred- ed a fraud in the transaction, which itors, and included therein an amount would require the suppression of the estimated as the value of future serv- knowledge of the material fact from ices which they (the attorneys) might the person upon whom he is commitrender the insolvent.88 And this view ting the fraud, such person is not to has been doubted by an English be charged with the knowledge.90 It court, 89 where it was sought to charge is difficult to determine from the Enga mortgagee with knowledge of his lish decisions when a case is brought solicitor, who was also the mortgagor within this rule. It is stated by Lord 431, 12 Week. Rep. 116, holding the N. E. 1117, where the attorney degrantee of an annuity not chargeable signed to advance and further the inwith the knowledge of his solicitor of terests of the borrower. the existence of a mortgage upon the 88 Shideler v. Fisher (1899) 13 Colo. property charged with the payments App. 106, 57 Pac. 864. The court of the annuity, where the solicitor was states that the attorneys were not enthe mortgagee.

gaged in any scheme with the debtor See Hewitt v. Loosemore (1851) 9 to defraud or wrong the principals Hare, 449, 68 Eng. Reprint, 586, 21 L. whom they represented, but were enJ. Ch. N. S. 69, 15 Jur. 1097, supra, gaged in an entirely reasonable effort note 64.

to secure the debts due their clients. 86Fairfield Sav. Bank V. Chase 89 Bradley v. Riches (1878) L. R. 9 (1881) 72 Me. 226, 39 Am. Rep. 319. Ch. Div. (Eng.) 189, 38 L. T. N. S. 810, 87 Benedict v. Arnoux (1898) 154

47 L. J. Ch. N. S. 811, 26 Week. Rep. N. Y. 715, 49 N. E. 326, refusing to 910. impute to a client knowledge of an at- 0 Kennedy v. Green (1834) 3 Myl. torney intrusted by the client with & K. 699, 40 Eng. Reprint, 266, 21 Eng. money to loan, acquired in a transac- Rul. Cas. 820, holding a mortgagee who tion in which the money was loaned to had employed the mortgagor as his a judgment debtor of the attorney, solicitor not chargeable with knowlwho received payment of his judgment edge that the mortgagor had fraudfrom the proceeds of the loan.

ulently obtained a conveyance to himA similar decision appears in Oly- self of the mortgaged property. It is phant v. Phyfe (1900) 48 App. Div. 1, further held in this case, however, that 62 N. Y. Supp. 688, affirmed without the circumstances under which the opinion in (1901) 166 N. Y. 630, 60 mortgage was taken were so suspi

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Hatherley, L. C.,91 "that the question, client in order to defraud him." In how far you are justified in assum- another case, 92 this qualification is ing that the agent does not commu- stated as follows: "If the disclosure nicate to his client information which of that fact of which knowledge is he has received, and ought to have sought to be fixed upon the client communicated, may be affected by would have imputed fraud to the solicvery delicate shades of difference. It itor, it is not to be presumed that the might be said that the very fact of solicitor did make disclosure of that the solicitor not having communicated fact.” And in a third case,93 here the an important circumstance is of it- assignee of a leasehold interest from self evidence of fraud. But Lord Jus- one of three trustees was held chargetice Turner, in the case of Atterbury able with knowledge of the trust bev. Wallis (1856) 8 De G. M. & G. 454, cause of the knowledge of his solic44 Eng. Reprint, 465, 25 L. J. Ch. N. itor, who was the trustee who made S. 792, 2 Jur. N. S. 1177, 4 Week. Rep. the conveyance, it was insisted that 734, exactly meets that difficulty, and the doctrine of imputed notice could says that such a rule cannot prevail. not apply, because the solicitor was It must be made out that distinct fraud committing a fraud. In answer to was intended in the very transaction, this, the court states: “But if the so as to make it necessary for the client would be affected with construcsolicitor to conceal the fact from his tive notice of a trust, the existence of cious that a solicitor ignorant of the In Re Barker (1875) 44 L. J. Ch. N. fraud would have been put upon no- S. (Eng.) 487, 23 Week. Rep. 944, holdtice; accordingly, the mortgagee was ing that a mortgagee to whom his soheld chargeable.

licitor had given a mortgage, and subRolland v. Hart (1871) L. R. 6 Ch.

sequently, in fraud of the mortgage, (Eng.) 678, 40 L. J. Ch. N. S. 701, 25

had deposited the title deed with othL. T. N. S. 191, 19 Week. Rep. 962. Cave v. Cave (1880) L. Ř. 15 Ch.

er mortgagees, did not have construc

tive notice of a subsequent voluntary Div. (Eng.) 639, 49 L. J. Ch. N. S. 505, 42 L. T. N. S. 730, 28 Week. Rep. 793,

deed of other property executed by

the solicitor. holding a mortgagee not chargeable with the knowledge of his solicitor,

MacArthur v. Hastings (1905) 15 who was also acting for the mort

Manitoba L. Rep. 500, holding the gagor, that the mortgaged property grantee of trust property from her had been fraudulently purchased with solicitor not chargeable with his trust money belonging to a trust of knowledge of the trust. which the mortgagor and the solicitor Sankey v. Alexander (1874) Ir. Rep. were the trustees.

9 Eq. 259, holding a lender not chargeRe Southampton (1880) L. R. 16 Ch. able with knowledge of the solicitor, Div. (Eng.) 178, 50 L. J. Ch. N. S. 218, who represented both the lender and 43 L. T. N. S. 687, 29 Week. Rep. 231, the borrower. holding a mortgagor who had paid the Cameron v. Hutchison (1869) 16 mortgage debt to his solicitor not

Grant, Ch. (U. C.) 526, holding the aschargeable with knowledge of such

signee of a mortgage not chargeable solicitor, of an interest in the mort

with knowledge of the assignor, his gage debt of another client of the so

solicitor, of a fraudulent intent in the licitor.

assignment. Waldy v. Gray (1875) L. R. 20 Eq. (Eng.) 238, 44 L. J. Ch. N. S. 394, 32

See Fordtran v. Cunningham (1915) L. T. N. S. 531, 23 Week. Rep. 676,

Tex. Civ. App. — 177 S. W. 212, holding that a mortgagee who had em

supra. ployed the mortgagor's solicitor to

1 Rolland v. Hart (1871) L. R. 6 pass upon the title to the mortgaged

Ch. (Eng.) 678, 40 L. J. Ch. N. S, 701, premises was not chargeable with the 25 L. T. N. S. 191, 19 Week. Rep. 962 solicitor's knowledge of a prior lien, 92 Waldy v. Gray (1875) L. R. 20 where the solicitor, as a trustee, was Eq. (Eng.) 238, 44 L. J. Ch. N. S. 394. the holder of the prior lien, and had 32 L. T. N. S. 531, 23 Week. Rep. 676. fraudulently delivered up to the mort- 93 Boursot v. Savage (1866) L. R. 2 gagor the title papers evidencing the Eq. (Eng.) 134, 35 L. J. Ch. N. S. 627. prior lien.

14 L. T. N. S. 299, 14 Week. Rep. 565.

which is known to his solicitor, in a able man, imparted to or acquired by case where there is no fraud, the fact the attorney.95 How far the knowlthat the solicitor is committing a edge of a clerk will be imputed to the fraud in relation to that trust cannot client of an attorney is a question upafford any reason why the client on which there is little authority. It should not be affected with construc- has been stated that where a solicitor, tive notice of the existence of the with the consent of his client, puts his trust. It is the existence of the trust, managing clerk to conduct the manand not the fraud, of which he is held agement of the matter which the solicto have constructive notice; and the itor was retained to conduct, he thus constructive notice of the existence of puts his clerk into a position which the trust must be imputed to him makes the notice of the clerk to be nowhether there is a fraud relating to tice to the solicitor, and so to the it or not."

ultimate client; but where the solic

itor does not delegate the whole of VII. Knowledge of partner or clerk of

his authority to his clerk, but, on the attorney.

contrary, retains a part of the busiIt seems clear that notice in regard

ness in his own hands, notice to the to the subject-matter of the employ

clerk is not notice to the client. The ment, to one of a number of attorneys

court states: "I am not prepared to employed by a client, is notice to the

hold that, apart from the question of client.94 While it is true that notice

substitution for the principal, the posito one of a firm of attorneys is notice

tion of managing clerk is one that to all members of the firm, it is only

makes notice to the clerk to be the constructive notice to those who have

notice of his principal.” 96 no actual knowledge of the facts. This constructive notice, it has been VIII. Knowledge of general attorney. held, is not sufficient to charge a cli- Knowledge of an attorney retained ent of a member of the firm in another generally by a client to render such and subsequent transaction; construc- legal services as the client may from tive notice to the client springs from time to time require is not, in all inactual knowledge, or such information stances, imputable to the client.97 as should awaken inquiry in a reason- Thus, it has been held that knowledge

94 Brown v. Oattis (1875) 55 Ga. a firm knowledge of a suit conducted 416; see supra, note 16.

by another member of the firm, it is See Smith v. Wilson & B. Sav. Bank stated simply that it was not shown (1892) 1 Tex. Civ. App. 115, 20 S. W. that the first-mentioned member had 1119, supra, note 13.

actual knowledge of the suit, and un95 Wittenbrock v. Parker (1894) 102 less there was actual knowledge such Cal. 93, 24 L.R.A. 197, 41 Am. St. Rep. knowledge could not be imputed to his 172, 36 Pac. 374, holding that a mort- client. gagee who employed one of a firm of That constructive knowledge of an attorneys to pass upon the title to the attorney may be imputed to a client, mortgaged premises before the mort- see Presstman v. Mason (1887) 68 Md. gage was taken is not chargeable with 78, 11 Atl. 764; Shartzer v. Mountain notice of a mistake made by another Lake Park Asso. (1897) 86 Md. 335, member of the firm in a release of a 37 Atl. 786, supra, note 16. See Butler prior mortgage, the release covering v. Morse (1891) 66 N. H. 429, 23 Atl. all the property, when it was intended 90, supra, note 16. to release only a part.

96 Re Ashton (1891) 64 L. T. N. S. That constructive notice to an at- (Eng.) 28, 39 Week. Rep. 320, 8 Mortorney will not be imputed to his cli- rell, 72. ent is held in Central Trust Co. v. West As to dealings with a clerk, see India Improv. Co. (1900) 48 App. Div. Northwest Constr. Co. v. Valle (1906) 147, 63 N. Y. Supp. 853, reversed with- 16 Manitoba L. Rep. 201, supra, note out reference to this point in (1901) 6. 169 N. Y. 314, 62 N. E. 387.

97 In Hooper v. Cooke (1856) 2 Jur. In Brown v. Sweet (1880) 7 Ont. N. S. (Eng.) 527, 25 L. J. Ch, N. S. App. Rep. 725, where it was sought to 467, it is stated that communications impute to the client of one member of through a solicitor, to make them ng

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