Re the Somerset Case in Appeal.

Kay L.J. said—"Mr Somerset consented in writing to the mortgage, ft was made at his instigation and request. It is the essence of the section that the breach of trust, nothing more nor less, was committed at the request and instigation of the beneficiary. Somerset was a party to all that occurred. He conducted the negotiations to some extent himself.

Davey L.J, said—"Somerset was in reality the cause of the breach of Trust, or at all events, privy to it."

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known to Mr. Somerset as to the Trustees themselves."

In Appeal Davey L. J. said—"It Is not of course necessary that the beneficiary should know the investment to be in law a breach of Trust, but he must, I think, know the facts which constitute the breach of Trust. Mr. Somerset was informed by letter of the 20th July that the loan was afterwards increased to £35,000."

Smith L. J. said:—"It was proved that Mr. Vere Somerset was anxious from the year 1876 that his trust funds, which amounted to about £35,000 should be shifted out of the securities they then were in, and invested on Lord Hill's Hawkstone Estate. He was desirous this should be done so as to have a better security for the Trust Funds. He knew that the acreage of this estate was 722 acres. He knew the farms, their names, and the locality in which they were situated. He consulted his father-in-law, Colonel Hill, upon the matter. He was a Trustee of the Hawkestone Estate and be, according to the Plaintiff's own evidence, undertook the negotiations with Lord Hill and Mr. Haste (Lord Hill's ajent) as regards the proposed advances. Colonel Hill, presumably, was well acquainted with the farms. It was proved that Mr. Vere Somerset pressed the Defendants to make the advances against the Hawkestone property and sign a written consent in that behalf. The above facts in my judgemnt were established."

"The only cases quoted and relied on in the judgment to sustain the dictum that Mrs. Isaac must be deprived of interest on amounts now by it restored to the Residue Funds are Thorne v. Heard, and Somer set Powlett. In the former the Lord Justices in Appeal emphasised strongly the fact that as the Trustees knew nothing of or were "party or privy" to the wrong they ought not to suffer. Can this be said of Mills, Mrs Isaac's Trustee, who did the wrong and that quitc unknowu to her? In the latter case in the judgment it is said Somerset "pressed the defendant Trustees to make the advance complained of and signed a written consent on that behalf." Did Mrs. Isaac do this or bad she knowledge of the way her funds were disposed of ? The reverse is the fact; her Trustee, Mills, without her knowledge or approval, himself committed the wrongs complained of, and misapplied her residue Funds which the judgment now restores, supplied her with accounts that were inaccurate and misleading, himself thus creating false impressions on her mind, and then forced her into Court I ascertain what the Residue Balances should be. Upon these facts brought out in evidence the Court rules that there is nothing inequitable in the Trustee pleading the Statute of Limitations, and in Mrs. lsaac being thus deprived of interest on these thus ascertained Residue balances."