Newman v. Meek, 1 Free. Ch. 441

1 Free. Ch. 441 | Miss. Chanc. Ct. | 1844

The Chancellor.

Although the facts in this case are somewhat voluminous, very few of them seem to have any direct connection with its merits. The complainants became the purchasers from one Warner M. Yeats, of a plantation and a number' of slaves, situated in the county of Madison. Prior to their purchase, the same land and slaves had been conveyed in trust to the defendant, Montgomery, for the purpose, in part, of securing the payment of a large sum of money, owing by said Yeats to Joseph Meek. The deed of trust contains a provision that the trustee should, when Yeats made default in the payment of the money, advertise and sell all or so much of the property as might be necessary to meet such default. The complainants show that they had full notice of the deed of trust, and I infer, although it is not expressly so stated, that they purchased from Yeats with the understanding and agreement that they were to discharge the debt due from him to Meek under the deed of trust.

It is charged that Joseph Meek is dead, and that the complainants entered into an agreement with his administrator, Jesse Meek, by which it was stipulated that the payments under the deed of .trust should be delayed until the debt could be discharged by the annual crops of cotton to be made on said plantation. It is also charged .that said administrator, in violation of this agreement, procured the trustee to advertise and sell under said deed of trust, at a time of great pecuniary pressure; that this step was the result of a fraudulent combination between the trustee and said Meek, for the purpose of enabling Meek to become the purchaser of the property at a sacrifice; that, at the sale of the property, there were but few persons present, and that Meek became the purchaser of the whole of it; at about one-fourth of its value. Upon these grounds a rescission of the sale is asked for.

The questions to be examined are': 1. What is the effect of the alleged agreement for delay on the payments due under the deed of trust? 2. Does the testimony establish any fraud or oppression on the part of Meek and Montgomery, with reference to the sale? 3. Was the price at which the property sold so grossly inadequate as to vitiate the sale?

1. The agreement for delay, which the complainants have attempted to establish by evidence, is -liable to the objection that it rests entirely in parol, and cannot be admitted, therefore, for the purpose of contradicting or altering the terms of the written agreement as embodied in the deed of trust. But a more insurmountable objection to such agreement is, that it appears to be wholly without consideration, and was therefore a mere gratuitous agreement for indulgence, which Meek was at any time at liberty to disregard, without violating any legal or equitable obligation, or subjecting himself to any legal liability or restraint. It is useless to refer to authorities to establish these plain and familiar principles of law.

2. The second ground urged for the complainants is, that the sale was brought about under such circumstances as render it fraudulent in the eyes of a court of equity. I can have no doubt, upon general principles applicable to all contracts, that if a purchaser at such sale, by fraudulent management or misrepresentation, prevented the attendance of others, or used any influence to put down fair competition in bidding, a court of equity would interpose and set aside such sale on the ground of fraud. But I have looked closely to the testimony in this case, and find nothing to cast the slightest suspicion upon the conduct of either the trustee or the purchaser.

I can see nothing in the time, manner or place of sale, inconsistent with the requirements of the deed, or incompatible with the strictest notions of fairness and honesty. The testimony shows that there were present from twelve to twenty persons: that Meek had been active in giving extensive circulation to the notice of sale, by having it inserted- in the Gazette, published in the neighborhood, and posted in public places in printed handbills, and that on the day of sale he was urgent in endeavoring to get others to bid, saying he wanted the money due him, not the property. I see nothing in the allegations of the bill that money was scarce, and that the complainants urged a postponement of the sale, to warrant the imputation of fraud. The defendant’s money had then been due for more than a year, and I can see no obligation on his part to await a more favorable condition of the money market.

3. The last ground taken for the complainants is, that the sale should be set aside for gross inadequacy of price. The application of the rule, with reference to inadequacy of price, has been generally made to private contracts between vendor and purchaser, and has been held not to extend to sales by auction, unless connected with some other circumstances going to establish fraud. Shelly v. Nash, 3 Madd. Rep. 232; White v. Damon, 7 Vesey, 30; Jenkins v. Hogg, 2 Cons. Rep. S. C. One of the reasons given why the rule is not applicable in sales at auction, is, that there can be no treaty between vendor and purchaser, and therefore no opportunity is afforded for fraud or imposition on the part of the purchaser.

Another and more satisfactory reason is,'that'sales of that description, where they are openly and fairly conducted, furnish the best evidence of the market price of the thing sold. But even if the rule applied to sales at auction, there is nothing in the facts of this case which calls for its application. All the witnesses concur in saying that the slaves sold for their value, but that the land did not, having brought only five dollars per acre. One of the witnesses says the land was worth fifteen dollars per acre, whilst the others do not attempt to fix its value.

It is to be observed in this case, that the terms of the deed of trust call for a sale at auction for cash; if, therefore, it brought the usual market price at such sales, it is not liable to the objection of inadequacy, although it may fall short of the sum at which it might have been estimated in a private sale between vendor and purchaser. The deputy marshal proves that he sold land in the same county about the same time, and of equal value at the sum of five dollars per acre, and the sheriff of the county testifies that he sold land under like circumstances at from two to four dollars per acre. I can see nothing, therefore, in the testimony showing that the land did not bring its market value, much less to warrant me in setting aside the sale upon the ground of inadequacy of price. The inquiry in this case is not whether the property brought Its market value; but the question is, whether the deficiency is so great as to amount to evidence of fraud and unfairness in the sale.

Mere inadequacy of price is not sufficient to set aside a contract, unless it is so gross as to furnish evidence of fraud, in the language of Lord. Thurlow in the case of Gwynne v. Heaton, 1 Bro. Ch. Rep. 9, “there must be an inequality so strong, gross and manifest, that it must be impossible to state it to a man of common sense without producing an exclamation at the inequality of it.” The cases of Butler v. Haskell, 4 Dess. 652, and Udall v. Kinney, 3 Cow. 590, are authorities to the same effect. Applying these authorities to the case before me, I am unable to see any thing in it that will justify me in disturbing the sale.

I shall accordingly direct the complainants’ bill to be dismissed at their costs.