THE DANGERS OF TRUSTEESHIP.

Manawatu Standard, Volume IX, Issue 78, 5 March 1885, Page 2

THE DANGERS OF TRUSTEESHIP.

♦ A case m which judgment was given m the High Court of Justice recently, shows how real and numerous are the dangers attaching to trusteeship. The judgment was on a motion to make the respondent, Mr Henry Mitchell, liable, as truatee, for sums amounting to j £8564 entrusted to him by a solicitor for payment into Court. Mr Mitchell was, by the sanction of the Court, acting as salaiied manager of a colliery, a moiety ot which was the property of his late father, under whose will he was one of the trustees of the estate. He was accustomed to employ a solicitor named Tattershall, both before and after that i

person's bankruptcy m 1879, and had entire confidence m his integrity. In January, 1882, and on other subsequent occasions, ho paid Taxtbrshall £8564 — the moiety of the profits of the colliery — directing him to pay it into Court to the credit of the administration account. Instead of paying the money into Court, Tattershall embezzled it and was sent to gaol m June. Under these circumstances the beneficiaires under the will of Mr Mitchell's father (with the exception of himself and son, who, as beueficiaires were each entitled to one-sixth of the amount) asked for an order of the Couit to compell him to refund the money. Mr Justice Chitty, m giving judgment, said the question was whether the respondent had, as paid agent, acted with a " proper amount of care." The learned Judge considered that he was justified m employing Tattershall as a solicitor, for, although a bankrupt, the latter had not beeu struck off the tolls, and since his bankruptcy had been entrusted by other persons with largo sums of money. But he held that the respondent was liable, because hehad made no enquiries as to what had become of the sums from time to time transmitted to Tattershall He appeared, said Mr Justice Chitty, to hay enlaced a blind confidence m Tattershall, and the result was that he must hold the respondent responsible for the sums lost. This judgment will create uneasiness m the breasts of not a few trustees. One would bavH thought, thai if MiMitchell was justified m employing Tatteshall us a medium between himself and the Court), ihat, holding Tattershall's receipt, he was justified m placing enliie confidence m him, and could not have been held liable. But it appears not, and m future, a trustee, who wishes to place himself beyod an action of this kind, will have to dog every footstep of the solicitor that he employs. For Mr Mitchell one cannot but feel profound sympathy, because there was certainly no wilful negligence on his part; m fact, he took as much care as ninety-nine men out of a hundred would have done, viz., he took the solicitor's receipts, for the various sums. The term " proper amount of care " is capable, however, of a very wide application, and trustees who read this case will feel very uncomfortable when they reflect on their own responsibilities.