Report No. 17

Section 62.- For section 62 of the principal Act, the following section shall be substituted, namely:-

"62. Wrongful purchase of trust-property by trustee.-(1) Where a trustee has wrongfully purchased trust-property, the beneficiary has a right to have the property declared subject to the trust or re-transferred by the trustee, if it remains in his hands unsold, or, if it has been purchased from him by any person with notice of the trust or acquired from him by any person without consideration, by such person but in such case the beneficiary must repay the purchase-money paid by the trustee, with interest, an such other expenses (if any) as have been properly incurred in the preservation of the property by the trustee or purchaser or such person; and the trustee or purchaser or such person must-

(a) account for the net profits of the property,

(b) be charged with an occupation rent, if he has been in actual possession of the property, and

(c) allow the beneficiary to deduct a proportionate part of the purchase-money if the property has deteriorated by reason of any act or omission of the trustee or purchaser or such person.

(2) Nothing in this section shall-

(a) impair the rights of lessees and others who, before the institution of a suit to have the property declared subject to the trust or re-transferred, have contracted in good faith with the trustee or purchaser or such person; or

(b) entitle the beneficiary to have the property declared subject to the trust or re-transferred where he, being competent to contract, has himself, without coercion or undue influence having been brought to bear on him, ratified the sale to the trustee with full knowledge of the facts of the case and of his rights as against the trustee; or

(c) be construed as impairing any right of the beneficiary to obtain any other relief to which he may be entitled in respect of the property".