The Accountants' Magazine (Volume 12) (Paperback)

This historic book may have numerous typos and missing text. Purchasers can download a free scanned copy of the original book (without typos) from the publisher. Not indexed. Not illustrated. 1908. Excerpt: ... fying that the statement is a correct copy or summary of the audited balance-sheet. The case of Sleigh (which is reported on Factor's 2) is one of considerable interest and im Chargesas v 8' Law Agent, portance to professional men acting as trustees. It involves the application of a fundamental principle of our trust law--that a trustee must not make a profit out of the execution of his office, unless and to the extent authorised by the terms of his appointment. The rule is clear and stringent. It covers fees for professional services rendered to the trust, even though the services are essential and moderately charged. And for the purposes of the rule a trustee's firm is himself. It may be that our law treats trustees in a harsh and inequitable manner, but with that question it is not proposed to deal. Another matter arises in this case which must also be put aside--viz., the propriety of the not uncommon practice of an agent acting both for lender and borrower in a loan transaction. But, standing the law and practice as it does, is the judgment of the Second Division sound? The real difficulty in the case arises under the second objection. The first objection was not opposed by the factor, and the third, fourth, and fifth raise no question of principle, but depend on the facts. Taking, then, the second objection, there were two transactions to which it applied. (1) In the one the factor lent part of the trust funds to a client of another firm. Here, according to the ordinary rule, the factor qua agent of the lender received a fee for drawing the deed, and the borrower's agent a fee for revising. (2) In the other the factor lent trust funds to a client of his own firm, and as agent of both parties received, according to the ordinary rule, both drawing fee...