DICKINSON, APPELLANT
25 N.E. 99 (Mass. 1890)

PROCEDURE: Appeal from a decree of the Probate Court, disallowing in part the account of William A. Dickinson as trustee under a deed of trust. Hearing before C. Allen, J., who reported the case for the determination of the full court, in substance as follows.

FACTS: Dickinson, trustee held in trust $16,260 05 On May 9, 1881, he bought 30 shares of Union Pacific Railroad stock at $119 per share, which with commissions amounted to $3,573 75 On August 16, 1881, he purchased 20 shares more at $123 per share, amounting with commissions to $2,475 When accounting before the court it was not allowed and Dickinson appealed

ISSUE: Is an investment of 37% of a trust's assets in speculative stock the act of a trustee in good faith and sound discretion, and how men of prudence, discretion, and intelligence manage their own affairs in regard to the permanent disposition of their funds, considering the probable income, as well as the probable safety, of the capital to be invested1?

RULE: An investment of 37% of a trust's assets in speculative stock is not the act of a trustee in good faith and sound discretion, and how men of prudence, discretion, and intelligence manage their own affairs in regard to the permanent disposition of their funds, considering the probable income, as well as the probable safety, of the capital to be invested

HOLDING: Where trustee's investment in stock of newly formed railroad company, and for which he paid premium, was attended with considerable risk because of heavy indebtedness of company, and he shortly thereafter made second investment therein, paying higher premium than before, held that notwithstanding his good faith second investment should be charged against him.