44 Ky. 492 | Ky. Ct. App. | 1845
delivered the opinion of the Court.
Jeffries, as the beneficial owner of sundry small judgments against P. N. Thomas and others, on which executions had been returned “no property found,” filed his bill to-subject to these demands, 200 acres of land which Thomas had mortgaged to Shirley for a debt of about $113, and making Shirley a party, prayed that he might proceed upon his mortgage, and that so much of the land as remained after satisfying Shirley, might be subjected to his demands. Shirley, by cross bill, set up his mortgage and debt, and prayed for a sale, &c. A decree was subsequently rendered upon the cross bill alone, for the sale of the land to satisfy Shirley’s debt, and Shirley having become the purchaser at the sale, for about $137, the amount of his debt, interest, and costs, Dale, upon the return of the Commissioners report, objected to its confirmation, and moved to set aside the sale and to have a re-sale, offering to pay the amount of Shirley’s decree, with ten per centum thereon, or to pay Shirley’s debt for one half of the land. He farther showed, by his affidavit, in support of his motion, that during the pendency of the suit, an execution for about $170 had issued against Thomas and himself as his surety, under which he had purchased the equity of redemption in this land, and that having paid the residue of the execution, he had taken a mortgage on the same land from Thomas, who was otherwise insolvent; that to save himself, he had also acquired the interest of Jeffries in the suit; that his interest being thus deeply involved in the sale of the land, which furnished the only means of reimbursement, he had intended to attend it and bid for his. safety, and was in the town of Glasgow where the sale w'as to be made,
We take the fact then to be, that a party deeply interested, was misled with regard to the time of the sale, and prevented from attending it, by reason of an impression taken up from the conversation of the mortgagee, who purchased. And conceding that this impression was not intended to be produced, the question is, whether the mortgagee, who by reason of this mistake, has under a decretal sale, purchased a tract of land for about one sixth of its value, should, in a Court of Equity, and upon objection to the sale, made in due time, with an offer of a large advance upon his bid, be permitted thus to engross the debtor’s whole property, greatly exceeding the value of his debt, and to throw an entire loss upon that creditor, who has been deceived by his conduct.
This Court has in several cases maintained the doctrine, that in sales by Commissioner under a decree, the accepted bidder has no independent right to have his purchase confirmed, but that the confirmation of the sale, depends upon the sound equitable discretion of the Chancellor, by whom, through the Commissioner, as his agent, it is made, Busey vs Hardin, (2 B. Monroe, 411;) Forman, &c. vs Hunt, (3 Dana, 614,) &c. Chancellor Hanson, of Maryland, is reported to have said, that “reasons which would induce him as proprietor or trustee, to set aside a sale made by his agent, should determine him as Chancellor to refuse his approbation to a sale made by a trustee,” (2 Harris, and Gill, 365,) that is, by the Court’s Commissioner. And in Anderson vs Foulke, (2 Harris and Gill, 257,) Chancellor Blanding, in stating the practice in the State of Maryland, says if there should be made to appear, either before or after the sale has been ratified, any injurious mistake, misrepresentation or fraud, the biddings will be opened.
In New York, where the practice in selling under decrees for foreclosure and sale of mortgaged property, is substantially the same as in this State, and the question
In the case of Greele vs Emory, referred to in Barbour’s Chancery Practice, vol. 1, page 539, the party objecting to the sale which had been made at a great sacrifice, had been unintentionally misled with regard to the time of the sale by the solicitor of the complainant, who was the purchaser. And in Wharton vs Thatcher, referred to in the same place, the property was purchased by the complainant ata great sacrifice, in consequence of the horse of the defendant’s agent, who was sent to bid for it, having given out, from the heat of the day. And in both cases a re-sale is said to have been ordered.
In Dale vs Williamson, the executor of the mortgagee had been innocently misled as to the time of the sale, and the purchase seems to have been made by a stranger. In McPherson vs Lansing, the objector seems to have recently discovered that he was liable to a decree for the deficiency of the mortgage sale, and on this ground, and his offer of a large advance, a re-sale was ordered, the mortgagee having been the purchaser. In Collier vs Whipple, the mortgagee or his solicitor, having been the purchaser, a re-sale was ordered, because judgment creditors were prevented from attending the sale, in consequence of an impression received from the master, (tho’ without fraud on his part,) that the sale would not take place on the day, &c. And in Tripp vs Cook, the party standing in the place of the mortgagor, as having assign
In the most of these cases, the sale was set aside, on the-ground of surprise or mistake, innocently induced by the conduct of some one concerned in conducting or controlling the proceeding, whereby an interested party was prevented from attending -the sale. And although the general principle of policy which requires that judicial sales fairly made shall be sustained, is acknowledged and regaided, it is evident that the Courts have been disposed, and especially where the mortgagee is himself the purchaser, to require that all parties interested should have a fair opportunity of being present at the sale, and to regard slight circumstances in the mortgagee’s conduct, or that of his agents, tending to produce a mistaken impression as to the time of the sale, and thus to deprive them of the opportunify of attending it, as sufficient, when taken in connection with great inadequacy of price, to authorize a re-sale upon equitable terms.
Upon the principle and authority of these cases, we are of opinion, that the Chancellor should not have approved the Commissioner’s report, but should have reject ed it, and set aside the sale, upon Dale’s tender of the amount of Shirley’s debt, with ten per centum thereon. And as upon the payment of the debt of Shirley, there will be no necessity for an immediate re-sale, and as Dale having a junior mortgage, is entitled to redeem the first mortgage, it will be equitable and proper, upon his paying into Court, for Shirley, the amount of Shirley’s bid, with interest, and the ten per centum on the bid, which in this case will be a reasonable allowance for trouble and extraordinary costs of Shirley, that he should have the benefit of Shirley’s mortgage and decree, to be under his control, and to be enforced separately or together with other equities to which Dale is entitled, upon proper proceedings, to be instituted for litigating his right to do so, with all parties concerned.
Wherefore, the decree overruling Dale’s motion, and confirming the report and sale, is reversed, and the cause is remanded, with directions to quash said report and sale, upon the terms above mentioned, and for further proceedings.