180 Ky. 724 | Ky. Ct. App. | 1918
Opinion of the Court by
Reversing.
In the suit of Peoples Deposit Bank against him, J. A. Young became the purchaser of seventy acres of land and, in payment therefor, executed two purchase money bonds for $375.00 each, due in six and twelve months, with appellees, D. B. and W. B. Elliott, as sureties thereon. Three days after the first of these bonds became due, Young, by written assignment, transferred his purchase of the land to appellant. C. O. Durham, in consideration of the latter’s agreement to satisfy the purchase money bonds “and other valuable considerations,” which assignment was filed in that action and an order entered directing the court’s commissioner to convey the land to Durham when he had paid the purchase money bonds. Durham paid the first bond, then due, and took possession of the land, but he failed to pay the second bond, due April 25,1916, and appellees, being sureties thereon, were required to pay same, which they did September 9, 1916.
As a part of the consideration of the assignment of the purchase of the land to Durham, he executed three notes to Young for $202.86 2-3 each, due January 1, 1917, January 1,1918, and January 1,1919, respectively. The first two of these notes Young assigned to D. B. Elliott. In each of the notes is a provision that all shall become due and payable upon the failure to pay any one when due.
On September 15, 1916, appellees instituted this action against Durham, in which the above facts are recited and the two notes owned by D. B. Elliott are filed and made part of the petition, and it is further alleged all of the notes executed by Durham were, by his agreement with Young, to become due and payable at once, if he failed or refused ‘ ‘ to pay any of the unpaid purchase
J. A. Young was-made a defendant and required to set up his lien note, the third of the series executed to him by Durham, and this he did by answer and cross-petition filed November 3, 1916, in open court. Upon the same day the defendant, Durham, having been summoned and having failed to answer the petition, a default judgment was entered ag’ainst him as prayed in the petition. The note of cross-petitioner was adjudged a lien upon the land of equal rank with the notes owned by plaintiffs but inferior to their lien for the $405.80 they paid in satisfaction of the purchase money bond in the bank case, and the land was ordered sold in satisfaction of plaintiffs ’ judgment. In pursuance thereof the master, as directed, after appraisment at $1,300.00, sold the land as a whole on November 27, 1916, to the plaintiffs for $916.00. Defendant filed exceptions to the report of sale, upon the trial of which the sale was confirmed; and he has appealed from that judgment and the one entered' against him on November 3,1916.
1. The only ground relied upon for a reversal of the judgment of Nov. 3, 1916, and in fact the only ground upon which he could have relied, as that was a default judgment, is that the petition did not state a cause of action, in that the two notes of $202.86 each are shown by the petition not to have been due when the petition was filed and the judgment was entered. In this he is correct, because, by the terms of the notes filed with and made a part of the petition, none of them was due until January 1, 1917, while the petition was filed September 15,1916^ and the judgment entered on November 3,1916. It is true that there is a charge in the petition that it was agreed between defendant and J. A. Young, to whom the notes were executed, that they were to become due and payable upon the failure of the defendant to pay any part of the purchase price of the land when due, and that the purchase money bond, due April 25, 1916, was a part of
By reason of the failure of the defendant to demur to the defective petition he is liable for all costs incurred. Moore v. Moxey, 19 Ky. L. R. 160, 39 S. W. 420; Combs v. Pridmore, 19 Ky. L. R. 1934, 43 S. W. 681; Bush v. Louisville Trust Co., 24 Ky. L. R. 2182, 73 S. W. 775; Civil Code, section 93, sub-section 2.
The petition, however, does state a cause of action with reference to the $405.80, which plaintiffs, as his surety, paid in satisfaction of the purchase money bond executed by Young in the bank case and which Durham, in the purchase of the land from Young, had obligated himself to pay, and as to this item the judgment is not erroneous. As this sum was a prior lien upon the land, it was not error to order a sale of sufficiency of the land to pay this item before the notes secured by an inferior lien became due. Civil Code, section 694, as amended, Acts 1916, p. 656.
2. Among the exceptions to the report of sale we need notice hut two, viz.: that the price at which the land sold was grossly inadequate, and that the commissioner, in advertising the amount of debt and costs to be made, named an amount greatly in excess of that to be realized' under the judgment.
Hpon the first proposition, the defendant introduced proof to show that the land, which was appraised at $1,300.00 before the sale and sold for $916.00, was upon that day of the market value of $1,500.00; and tendered
The land was advertised and sold as a whole for the purpose, as stated in the' advertisement, of raising $897.00, whereas, at that time, a sale was authorized for only a sufficiency of the land to raise about half of that sum, and it was sold to plaintiffs for an amount barely sufficient to satisfy their lien debts against it, to the exclusion of the lien held by Young. At another sale, it is made certain that not only plaintiffs, but Young as well, will realize the full amount of their indebtedness, with something over for the defendant. These are circumstances which, we think, added to the gross inadequacy of the price at which the land was sold, imposed upon the chancellor the duty to have set aside the sale.
Wherefore, the judgment confirming the sale is set aside and that part of the judgment of November 3, 1916, based upon the notes not then due, is reversed, and the cause is remanded for proceedings consistent herewith.