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must in equity bear the burdens incidental to its ownership and not throw such burdens on their
trustees.
The short report of Balsh v. Hyham as given in 2 Eq. Ca. Al. 741 fol. 8 shows that this general rule was well recognised and that the decision was only an illustration of its application to the facts then before the Court.
It is impossible to read the judgment of Vice- Chancellor Wigram in Phené v. Gillan 5 Ha. 1 without coming to the conclusion that he also regarded the general rule as well established.
The principle acted upon in Balsh v. Hyham was reconsidered and most strikingly illustrated in the well-known case of the German Mining Company Ex parte Chippendale 4 De G. Mc and G. p.
19 where the shareholders of a mining com- pany were held liable personally to indemnify the directors against payments made by them in discharge of debts contracted by them but which payments created no legal obligation on
the company enforceable at law and could not
be recovered by the directors from the company by any action at common law. The shareholders in vain contended in that case that the directors had only a right to indemnity out of the assets of the company. See page 54.
Where as in Balsh v. Hyham a trustee seeks indemnity in respect of transactions in which he
need not have engaged and which were not within the scope of his trust he must prove that his cestui que trust either authorised or ratified such trans- actions. But if he has incurred liability within the scope of his trust and for the benefit of his cestui que trust Ex parte Chippendale shows that nothing more is required.
When a trustee seeks indemnity from his cestui que trust against liabilities arising from the mere fact of ownership there is neither principle nor authority for saying that the trustee need prove any request from his cestui
que trust to incur such liability. In the case supposed the trust involves such liabilities and the trustee whilst he remains such cannot get rid of them. He is subject to them as legal owner; but in equity they fall on the equitable owner unless there are good reasons why they should not.
As regards shares this right of a trustee to be indemnified by his cestui que trust against calls has been repeatedly recognised and enforced on the principles applicable to the equitable owner- ship of property, and without reference to the principles applicable to contracts or specific performance or any other legal or equitable doctrine. Nothing can be plainer or sounder than the language of Vice Chancellor James in Castellam v. Hobson L.R. 10 Eq. 47; and of Chitty, J. in Loring v. Davis 32 Ch. D. 634. James v. Way L.R. 6 Ho. Lo. 328 proceeded on the same principle. Other cases to the same effect might be cited but it is unnecessary to refer to them. No case has been found, nor as their Lordships believe can be found, which is opposed to these authorities.
The principle was recognised by Mr. Justice Fry in Hughes Hallett v. The Indian Mammoth Gold Mines Company L.R. 22 Ch. D. 561 although be there held that the application for indemnity was premature.
It is true that the facts of this case are not in all respects like those in the cases above alluded
to. But although the facts are different the result of them is the same; i.e., the facts were such that the relation of trustee and cestni que trust was created. In this case the Defen- dant did not create the trust on which the Plaintiff originally held the shares. The Defen- dant had nothing to do with procuring their registration in the Plaintiff's name as trustee for Benjamin and Kelly and their assigns. This
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