4 Cow. 717 | Court for the Trial of Impeachments and Correction of Errors | 1825
“ The facts in this case, as they appeal from the pleadings and proofs, are substantially these: John M. Berry of Moreau, in the county of Saratoga, was indebted to the complainants, S. & A. Hawley, in the sum of $1300, and to Marvin in the sum of $500. He was also indebted to the defendants, House & Myers, $1820, Stewart & ICnickcrbacker, $520, and to De Wolf, $950. One Isaac B. Payne was also supposed to be holden as endorser and surety for Berry in the sum of $2450, including a small debt actually due to him from Berry.
On the 6th day of August, 1816, Berry being in failing circumstances, to secure the payment of these several sums, he gave to all those creditors a joint bond, in the penalty of $15,000, conditioned to pay $7540 with interest; and also gave a warrant of attorney to confess judgment on the bond.
The defendant, Cramer, witnessed the bond; on the back of which was a memorandum of the amount due to the obligees respectively. A judgment was entered in the Supreme Court, on the bond and warrant, the 9th day of the
The debt, to Knickerbacker & Stewart, was reduced to $301, by payments from Berry. ' The amount actually due to Payne, including all the Berry debts for which he was made responsible as his surety, was ascertained to be only $890; and for that sum he afterwards assigned to De Wolf, all his interest in the $15,000 judgment. In March, 1817, Cramer & Given, as attorneys for the plaintiffs, and at the request of House, Knickerbacker, and De Wolf, issued an execution on the judgment, with a direction to levy $7557, 75 and interest, &c. By virtue of this execution the sheriff levied on all the real property of Berry, a farm in Moreau worth $5000 ; and on the 8th of August it was advertised to be sold at Waterford, on the 23d of September, 1817.
Shortly before, or at the sale, the Waterford creditors, who with Cramer are the defendants in this suit, without the knowledge of the complainants, mutually agreed that Cramer, the attorney, should attend the sale as their agent, and bid upon the farm, at his discretion, for their separate benefit. He did accordingly attend the sale as the agent of the Waterford creditors, in the absence and without the knowledge of the other persons interested in the judgment, and bid off the farm for $625. On the 26th of December,
A preliminary question has been raised by the counsel for the defendants, of which I will first dispose. It is alleged, in the answer of House and Myers, that one Reynolds was jointly interested with them in their debt, as a partner. And it is now insisted that he should have been made a party to the suit.
It might perhaps be considered a sufficient answer to this objection, that Reynolds was not a party to the judgment against Berry, and has never been known in the transactions connected therewith; and therefore, as to the parties in this suit, he must be considered a dormant partner. But what is cdhclusive against the defendants, on this point, is the fact, that the statement of the interest of Reynolds, in the answer, is not responsive to any thing contained in the bill, and therefore is not evidence for the defendants. And they have produced no proof whatever to show that he was, in fact, a partner, or a party in interest.
On the part of the Hawleys, it is insisted, that the Given debt, with the two bills of cost thereon, being covered by
So far as it respects the principal debt, and the costs of the suit against the drawer of the note, the Hawleys can have no pretence of claim on the fund raised by the sale oí the real estate of Berry. The evidence is'conclusive that the whole amount of the judgment against the drawer of the note was raised by the sale of his personal property which was bid off by Alpheus Hawley ; who also gave a receipt in full of the execution. As to the cost of the suit against the endorser, (about $35) under all the circumstances connected with that transaction, I think it may be fairly presumed to have been an advance of that amount, by the Hawleys, for the benefit of Berry, without any intention on their part of holding Payne responsible therefor; and without any expectation of being reimbursed out of the property secured by the $15,000 judgment. They have therefore no claim to be substituted in the place of Payne for the amount of that cost.
Neither can the claim of the defendant De Wolf, for the whole $2450, under the assignment from Payne be sustained in a Court of Equity. In his answer, De Wolf denies all knowledge of the actual amount due from Berry to Payne, at the time of the assignment. But this is not, sufficient to entitle him to the whole amount, as a bona fide purchaser without notice. He was the purchaser of a mere chose in action ; and took the right of Payne subject to all the equities which existed against that right, in the hands of Payne. (Coles v. Jones, 2 Vernon’s Rep. 692, Turton v. Benson, 2 id. 764, Tourville v. Naish, 3 Peer Wms. Rep. 307, Livingston v. Hubbs, 2 John. Ch. Rep. 512.) But on the principles which are applicable to purchasers of the legal estate, De Wolf, cannot be considered a bona fide purchaser for this whole amount. Being a party to the bond and warrant, he is constructively chargeable with notice of the real situation of Payne’s dent. Besides he had actual information of that which was sufficient to put him on in quiry; and whatever is sufficient to put a party on inquiry
In Taylor v. Stibert, (2 Ves. Jun. 440,) Ld. Rosslyn says, “ It has been determined that a purchaser being told particular parts of an estate were in possession of a tenant, without any information as to his interest, and taking it for granted it was a lease from year to year, was bound by a lease the tenant had which was a surprise upon him. That was rightly determined ; for it was sufficient to put the purchaser upon inquiry that he ivas informed the estate was not in the actual possession of the person with whom he contracted.” And these remarks of Lord Rosslyn, are quoted with approbation by Lord Redesdale, as containing a doctrine which had never been doubted. (Crofton v. Ormsby, 2 Sch. & Lef. 599.)
De Wolf, in his answer, admits, that at or about the time of executing the bond and warrant, which was many months previous to his purchase of Payne’s right, he was informed that the $2450 was not all due to Payne, but was intended to cover endorsements and responsibilities for Berry, and which he might thereafter be compelled to pay. And with this knowledge, if De Wolf did in fact, as he alleges in his answer, purchase of Payne without ascertaining how much was actually due, it was crassa negligentia. Payne sold to him his right in the judgment for $890, the exact sum due ; and if De Wolf was not informed that was the real amount due, he must have remained intentionally and wilfully ignorant of that fact, for the purpose of obtaining more than his fair proportion of the proceeds of the judgment. And it appears by his answer that he has in truth, obtained more than his fail proportion ; even as between him and his co-defendants in this cause. Under such circumstances, he has no reason to complain of any hardship in the application of the maxim, caveat emptor, to his purchase of Payne’s interest in
It follows, from the reduction of De Wolf’s claim, under the assignment, to the real amount which was due to Payne, that the amount left in the hands of Cramer for the complainants’ shares of the purchase money bid at the sheriff’s sale, is less than they were actually entitled to, even if they are to be concluded by that sale. And if they are limited to their proportions of the $625, bid at that sale, there can be no propriety in permitting Cramer to retain out of that amount the $20 alleged to be due him on an older judgment. If the purchase by him, as the agent of the Waterford creditors, was a bona fide and legal purchase, it was a purchase subject to all prior incumbrances; and if any such existed the Waterford creditors should have paid them without deducting the amount from the purchase money in which other persons had an interest. As well might they claim to deduct from that purchase money the whole amount of the mortgage to Peebles, which was also an older incumbrance on the premises sold. The costs and sheriff’s fees, only, being deducted from the amount bid would leave $586 88, to be distributed ; and the whole amount due on the judgment, exclusive of interest, was $5761. Considering these as the basis of distribution, the proportionate share of the Hawleys, would exceed $130, and that of Marvin would be something more than $50. But the amount left in Cramer’s hands for the Hawleys, was only $107 16, and for Marvin $41 22; of which the latter has received nothing ; and the foimer, for some cause which is unexplained, have been paid only $94 19. Admitting, therefore, that the complainants have no claim beyond this amount,
But the defendants insist, that this part of the claim is barred by the act of limitations. The sheriff’s sale, was in September, 1817; the bill of the complainants was filed in November, 1823, and the appearance of all the defendants was entered on the 8th day of December, thereafter; and within six years after the sale to Peebles. The sheriff’s deed is not among the exhibits in the cause, and has not been read in evidence. It does not, therefore, certainly appear at what time the sale was consummated by the execution of a deed. But I think it may be fairly inferred, from the facts in the case, that the deed was not actually executed until about the time of the sale of the farm to Peebles. In ordinary cases, the execution of the sheriff’s deed will have relation back to the time when the sale actually took place; and it is the usual practice to date them at that time, though executed afterwards. But this relation, which is a fiction of law, is never to be adopted when third persons, who are not parties or privies, will be prejudiced thereby. (Heath v. Ross, 12 John. Rep. 141.) The statute of limi.tations could not begin to run until the purchasers became legally liable for the purchase money, which was not until the actual execution of the deed by the sheriff. It has been frequently decided by the Supreme Court, that a sheriff’s sale is within the statute of frauds; and that the execution of the deed is necessary to divest the title of the defendant in the execution. These decisions have been sanctioned by the highest judicial tribunal in the state. (Catlin v. Jackson, in Error, 8 John. Rep. 520.) The execution, on which the farm was sold, is in evidence, but there is no return thereon, neither is there any receipt or memorandum to show that any money was ever received by the sheriff or by any other person, on the execution. The necessary inference from these facts, taken in connection with the answers of the defendants, is, that no money was paid or received on account of the farm until the sale to Peebles. And the attempt by the defendants, at that time, to appor
Another objection, which has been urged by the defendants’ counsel, is, that there is no evidence to support the averment, in the complainants’ bill, that Berry was indebted to them in the sums therein stated; the defendants in theil answers, having denied all knowledge of such indebtedness.
The defendants, all admit, by their answers, that in the bond and warrant given by Berry, there was included the sum of $1300, as and for a debt of that amount due from him to the Hawleys; and $500 as and for a debt of that amount due to Marvin. The bond executed by Berry has been proved, and is an exhibit in the cause ; and that taken in connection with this admission in the answers of the defendants, is prima facie evidence of the debts due to the complainants, as stated in their bill. The defendants, by their answers, do not even pretend that they have any reason to believe these sums were fraudulently inserted in the bond and warrant, when no such debts were really due. If the defendants had any reason to suspect that the sums thus included in the bond and warrant, were not real and bona fide debts, due from Berry to the complainants, or that any part of the same had been paid to them by Berry, they might have set up that defence in their answer. In which case the defendants would have been permitted to establish the fact by proof at the hearing, or by a cross bill they might have called on the complainants to disclose the consideration and grounds of such indebtedness, and the payments, if any, which had been made thereon. The bond, as against Berry, is conclusive evidence of the debts, unless some fraud or mistake in the transaction could be shown. And it must, at least, be prima facie evidence of the indebtedness, as against third persons; especially where such third persons are parties to the same instrument.
Another objection has been made by the defendants’ counsel which goes to the jurisdiction of the Court. It is urged that if the complainants have any subsisting claim, against any of the defendants, they have a complete and ample remedy at law.
If the defendants were not too late with this objection, it would still be somewhat doubtful whether the complainants had a remedy at law, against their co-plaintiffs in the judgment, to recover their equitable proportions of the amount raised by the sale. Though I am inclined to the opinion, that they might have recovered against them, respectively, in actions for money had and received, within the principles which by modern decisions have been applied to that action. But the remedy at law was doubtful, and would have required a multiplicity of actions; either of which grounds would be sufficient to authorize the interference of a Court of Equity. Neither does it follow of course that this Court is ousted of jurisdiction in all cases where the party has a perfect remedy at law. The proposition is undoubtedly correct, as a general principle; but the rule is subject to many exceptions. There is a great variety of cases where Courts of Equity have concurrent. jurisdiction with Courts of Law; and such is the case in all matters of account. (Per Thompson, J. in Ludlow v. Simonds, 2 Caines’ Ca. in Error, 37, and per Kent, C. J. in Post v. Kimberly, 9 John. Rep. 505.) The extension of the equitable principles upon which actions for money had and received, may be sustained in Courts of Law, has not divested the Courts of Equity of their ancient jurisdiction in all matters of account. It is an established principle, that where a Court of Equity once had ju
Again ; the complainants had a right to come into this Court for a discovery of the amount paid to the defendants, by Berry; to ascertain the proceeds of the judgment, which had been received by them respectively; to ascertain the amount which was actually due to De Wolf, under the assignment from Payne ; and to settle the rights and proportions of the respective parties in the distribution of the fund. And it is a settled rule in equity, that when the Court has gained jurisdiction of the cause, for one purpose it may retain it generally. (Per Spencer, J. in Rathbone v. Warren, 10 John. Rep. 596.)
Another objection contained in the written points of the defendants, but which was not mentioned on the argument, is, that the complainants are improperly joined.
This objection could not have been intended to be seriously urged; for there is no rule in equity, which is better settled than the one, that all persons having an interest in the distribution of the fund or in the subject matter of the suit, must be made parties, either as complainants or defendants, if within the jurisdiction of the Court. And although there are exceptions to this rule, those exceptions are only by way of excuse for not bringing all the parties in interest before the Court. In Cockburn v. Thompson, (16 Vez. Rep. 324,) Lord Eldon mentions a variety of cases of this description. The objection that there is a misjoinder of complainants, can only be sustained, where several persons file a joint bill, for separate and distinct causes of action having no connection with each other ; neither as it respects the lights of the complainants, or the rights of the defendants.
Having disposed of these preliminary questions, I proceed to the examination of the one of more importance, the principal one in the cause, and which has probably produced this suit. Have the complainants any claim beyond their proportionate shares of the amount of the bid at the sheriff’s sale?
■ I have examined this question with much care and attention, not so much on account of the effect which my decision may have upon the interests of the parties to the suit, which should always be a subject of secondary consideration with the Court, as on account of the important principles which are involved in that decision. After a full investigation of the subject I have arrived at the conclusion that the validity of the purchase at the sheriff’s sale cannot be sustained. And consequently that the complainants are entitled to their proportionate shares of the amount which was received by the defendants on the subsequent sale of the farm to Peebles.
But though, under all the circumstances of this case, I am compelled to pronounce the purchase, at the sheriff’s sale, fraudulent and void as against the complainants, upon the principles of equity, there is nothing in this decision which necessarily implicates the characters of the defendants. The transaction was a contest by creditors to obtain a preference in the collection of their just demands which were due from a debtor who was insolvent. And though these defendants for the purpose of securing such preference, acting under a mistaken impression as to their legal rights, have made a purchase which is deemed constructively fraudulent, as being contrary to public policy and inconsistent with the equitable rights of the complainants, it is
complainants allege that the purchase at the sherpgps sai0j was fraudulent and void as against them;
. i. Because the execution was issued without their knowledge or consent.
2. Because they were not informed of the time and place of sale; and
3. Because John Cramer, one of the attorneys for the plaintiffs, and whose name' appeared on the execution as such attorney, became the purchaser, by collusion with the other defendants, at a sum far below the real value of the property; and this in the absence, and without the knowledge or the consent of the complainants. And in connection with this, is the point arising out of the facts stated in the answers, as to the agreement made by the defendants with each other, previous to and at the sale.
Before I proceed to the examination of these points, I will barely remark, that as it satisfactorily appears that no money was paid to the sheriff by the defendants, or by Cramer the agent of the Waterford creditors, on the sale upon the execution; and the purchase being made with the moneys due on the judgment, a part of which purchase money belonged to the complainants, it might be questionable, whether a trust in their favor, pro tanto, was not created by such purchase. But as this has neither been made a point in the cause, nor discussed at the hearing, I shall not go into the examination of that question.
1. It is admitted in the answers of some of the defendants, that the execution was issued at the request of House, Knickerbacker and De Wolf in the absence of the complainants ; and probably, at the time, it was without their knowledge. But the defendants all deny any fraudulent intent in taking out the execution ; and the complainants have produced no evidence whatever, to contradict this point of the answers. And all suspicion of fraud, or of any improper object in issuing the execution, is rebutted by the fact, that it remained nearly five months in the sheriff’s hands, before the farm was advertised for sale thereon.
2. It appears that the farm was advertised for sale in the manner prescribed by law, in a public newspaper of the county. And whether that paper was published at Waterford, as both parties have supposed in their pleadings in this cause, or at Ballston-Spa, as the proofs would seem to indicate, is wholly immaterial. In the absence of all evidence to the contrary, I am also bound to presume that the officer complied with the other requisites of the statute, by affixing up notices, of the time and place of sale, at three of the most public places in the town where the land was to be sold. This was legal notice to all persons interested in the sale. But in addition to this legal notice, the answer of De Wolf is positive, that, before the sale, he gave actual notice to Marvin of the time and place when it was to be made, and requested him to attend, or to make some arrangement in relation to the property. This part of the answer is responsive to the bill, and being uncontradicted, is conclusive evidence of the fact. The testimony of Given is nearly as positive, as to the information which he communicated to Alpheus Hawley. And though it is probable Hawley may have mistaken the day, or even possible that Given unintentionally misinformed him as to the time, yet neither of those circumstances could form any sufficient ground for impeaching the validity, of the sale.
3. The defendants have expressly denied the existence of any fraud, or fraudulent intentions, in the employment of Cramer to purchase in the property for them on the execution. But this general denial is not sufficient, in this case; though it mav be sufficient to rebut the presumption of any corrupt intention on the part of the defendants. If a party, in his answer, admit the existence of facts which render the transaction, in which he has been engaged, legally or constructively fraudulent as against the complainants, his general denial of all fraud will not counteract or alter the legal
In this case, from the admission of the defendants, there can be no doubt of the fact that the Waterford creditors agreed not to bid against each other at the sheriff’s sale; and-that they also agreed to employ Cramer, one of the attorneys for all the parties on the record, as their separate agent to bid in the property for their joint benefit in the proportion to their respective interests in the judgment; and to exclude the complainants from any participation in the benefits arising from the purchase, beyond their proportions of the amount actually bid at the sale. ■
If the plaintiffs in the judgment, are to be considered as having distinct and separate interests therein, and as respecting different rights, their agreement, not to bid against each other, but to unite in the purchase, was of itself against public policy; and was constructively fraudulent, not only as against their co-plaintiffs, but also as against Berry, the defendant in the execution.
In Doolin v. Ward, (6 John. R. 194,) the Supreme Court of this state decided, that an agreement by two persons that they would not bid against each other at an auction, that one should buy in the articles, and they would after-wards divide the same equally between them, was against public policy; and was void, as tending injuriously to affect the character and the value of sales at auction. In Jones v. Caswell, (3 John. Ca. 32,) Radcliff, J. observes, “ The law has regulated sales on execution with a jealous care, and enjoined such proceedings as are likely to promote a fair competition. A combination to prevent such competition is contrary to morality and sound policy. It operates as a fraud upon the debtor and remaining creditors, by depriving the former of the opportunity which he ought to possess of obtaining a full equivalent for the property which is devoted for the payment of his debts, and opens a door for oppressive speculations.” And these principles are expressly recognized and fully sanctioned by the late Chancellor, in Troup v. Wood &
But this is not the only objection which the complainants urge against the validity of the purchase. They also complain that the Waterford creditors employed the attorney on record to make the purchase ; that they seduced him from the allegiance which he owed to all the plaintiffs in the execution as their common agent for the collection of the amount due on the judgment; and that they engaged him to become the separate agent of a part of his clients, in a speculation not only inconsistent with but directly opposed to the interests of the rest, and contrary to the duty which he owed to the whole collectively. And here the important question arises, which I will now consider.
Can the attorney on record, who issues an execution, become a purchaser at the sheriff’s sale on such execution, either for his own benefit, or as the agent of others, against the interest and without the consent of those for whose benefit the execution issued ?
I consider the fact that the purchase was made by the attorney, without the consent and against the interest of some of his clients, or those for whose benefit he is supposed to act as attorney, as important in this case. For notwithstanding the Court, in Howell v. Baker, (4 John. Ch. Rep. 121,) said, that the rule disqualifying solicitors and attorneys from purchasing at sales brought about by their agency, had strong pretensions to be applied to the case, of an application by the defendant in an execution to set aside a purchase made by the plaintiff’s attorney, the late Chancellor,
All the cases, on 'the subject of 'purchases by persons standing in the situation of actual trustees for the sale, were ably and elaborately reviewed by Chancellor Kent, in Davoue v. Fanning, (2 John. Ch. Rep. 252;) it would therefore be considered presumption in me to go over that ground, and I shall not attempt it; but shall content myself with observing that the principles there settled, by" him, have been sanctioned by the highest Court in the Union. (Wormley v. Wormley, 8 Wheat. Rep. 441.)- In all such" cases, the rule appears now to be fully settled, that the purchase however
So far as I have been able to discover, the question whether an attorney can become a purchaser without the consent of his client, for whose benefit the sale is made ; or whether he stands in the same situation as regards his client, as the trustee or other agent does in relation to his cestuy que trust or principal, has not been judicially settled in any of the Courts of this country. In the English Courts the rule is frequently referred to by counsel, as being perfectly settled, and well understood. But even there I have been able to find but few reported cases, except in bankruptcy, where a purchase by the attorney has been set aside, notwithstanding it was perfectly fair in all its circumstances. The fact that lands are not there sold under judgments in the Common Law Courts, and that sales made by order of the Courts of Equity are examined and passed upon by the Court, on the coming in of the master’s report of the sale, will probably account for the small number of cases that appear in the English reports. The case of Owen v. Foullces, mentioned in a note to Lacy's case, (6 Ves. Jun. 631,) was a purchase by the solicitor in the cause; a bill filed by creditors; the purchase perfectly fair ; the solicitor bidding openly in the presence of very respectable persons concerned for mortgagees and creditors, and declaring that he was bidding for himself; the sale, at that time being also necessary. The reporter says “ but the general rule prevailed.” And the sale was set aside ; as had been done in a number of cases, there mentioned, where the purchase had been made by the soheitor to the commission in bankruptcy.
The principles of the French code, so far as it relates to attorneys, are sustained by Lord Thurlow, in Hall v. Hallet, (1Cox. Ca. 140.) In speaking of an assignment of certain debts, made by an administrator to an attorney who had been employed generally in the management of the legal business of the estate, he declared that if the decision rested upon the simple fact of the assignment only, the assignee should not be entitled to any advantage from the purchase of the debts; for no attorney could be permitted to buy things'in a course of litigation, of which litigation he has the management. And in the case of the petition of Frances James, in bankruptcy, (8 Ves. 352,) Lord Eldon set
But it is supposed, by the counsel for the defendants, that the case of Beardsley v. Root, in the Supreme Court of this state, (11 John. Rep. 464,) and Nelthorp v. Pennyman, in the English Court of Chancery, (14 Ves. Jun. 517,) have established the doctrine, that attorneys may become purchasers without the consent and against the interests of their clients. In the first case, the Supreme Court decided that the attorney for the plaintiff, as such, without other authority, had no right to make a purchase for the client ; especially under the circumstances of that case; where the. client would have to pay the amount due upon an older judgment. And the attorney having made such purchase when it was not- absolutely necessary for the protection of his client’s interests, and having taken a deed in his own name, the Court held him liable to -his client for the amount bid oh his execution. In the other case, Lord Eldon refused to discharge the solicitor in the cause from a purchase of the property, which had been made by him to prevent the sale at an undervalue. And he declared that the solicitor purchasing under such circumstances must keep the property, if the Court thought he ought to keep it. This last case was not a contest between the attorney and client, but it was an application to be relieved from the purchase that there might be a re-sale; and other parties in the cause, besides his own client, had an interest in the ques
But in this case, although Cramer had no authority to purchase for the complainants, he had in virtue of his character of attorney in the execution, the power to direct and control the proceedings thereon. When he found that the interests of a part of his clients were about to be sacrificed, in their absence, in consequence of the combination among the other plaintiffs in the execution, he could have apprized the officer thereof, and requested him to postpone the sale. And if the sheriff had refused to adjourn the sale, under such circumstances, and had proceeded to sacrifice the property, the Court would have set aside the proceedings as fraudu
He could not anticipate that there xvould be a combination among the other creditors, to prevent a fair competition ; or which would have the effect to destroy all competition among themselves, and thus reduce the amount of the bids. Much less could he anticipate that one of those attorneys, with the knowledge that such an arrangement had been entered into, would not only suffer the property to be thus sacrificed, but that he would also become the agent of the purchasers to bid in the property for them. And certainly that attorney mistook the duty which was imposed upon him by the relation in xvhich he stood to the complainants, when he consented, under such circumstances, to make the purchase as the agent of the Waterford creditors, without first letting the complainants know that he would no longer attend to their rights, in the collection of the judgment. It is true Cramer, in his answer, says he was only employed to enter judgment and issue execution. But I do not understand him to mean that there was any special agreement or understanding that he should do that and nothing more; but only as intending to say, there was nothing said about any further services. This would leave him the full control of the execution, on a retainer to enter the judgment and to issue execution, as in ordinary cases.
There are stronsr reasons, on the ground of public policy, against permitting the attorney to become the purchaser, either for himself or as agent of another, in any case
It is true, that, in Wendell v. Van Rensselaer, (1 John. Ch. Rep. 344,) Chancellor Kent refused to set aside a deed given to an attorney, although there was great inadequacy of consideration. But it, will be seen, by a reference to, that case, that the attorney had not been employed as such in relation to the property in question. In the language of an English Chancellor he was not attorney in hac re ;■ neither was he the general agent of Wendell, in relation to his property. Under the circumstances of that case, Yan Rensselaer, not being the attorney of Wendell in relation to this matter, might become the purchaser, as he was under no obligations of duty to advise in relation to that transaction. But even in that case, the Chancellor declared that if he had been able to discover the least scintilla of fraud or imposition, on the part of Van Rensselaer, in procuring the deeds, he should annul the transac? tion.
But it has been urged, in this case, that the complainants have lost their remedy, by lapse of time. In cases of implied trusts, in relation to personal property, or the rents and profits, of real estate, where persons claiming in their own right are turned into trustees by implication, or by operation of law, it is a general rule, that the right of action, in equity, will be considered as barred in six years, in analogy to the limitation at law. And probably if the commencement of this suit had been delayed a few days longer, the complainants would have lost all reniedyl by the operation of the statute of limitations. In cases of this description, independent of the statutes of ,limitation, if the person entitled to relief against an improper purchase, acquiesce for a long time, without making any objection, or bringing a suit, equity will not grant relief. But in this case there has not been any acquiescence of either of the complainants ; neither is the length of time sufficient to bar their claim. The statute of limitations cannot apply to this case, because the suit was commenced, and the appearance of the
But in cases of this kind, Courts of Equity have frequently refused relief where the suit was commenced within the twenty years : not however on the ground of any analogy to the limitation of actions, of the like nature, at law, but on the principle that acquiescence, for a great length of time, alter the party was in a situation to enforce his right, and with a full knowledge of the facts, was evidence of a waiver, or abandonment of the right. In all cases, like the present, the application to set aside the sale, or for other relief, must be made within a reasonable time ; but what is a reasonable time, cannot well be defined, so as to establish any general rule; and must in a great measure depend upon the exercise of the sound discretion of the Court, under all the circumstances of each particular case. In Gregory v. Gregory, (Cooper’s Ch. Ca. 201,) the Master of the Rolls refused to set aside a purchase, by a trustee, after a lapse of eighteen years. In Bergen v. Bennet, (1 Caines’ Ca. in Error 1,) the Court of Errors refused the application after sixteen years acquiescence. In Butler v. Haskell, the Court of Chancery of South Carolina did not consider eleven years an unreasonable delay; and in many cases relief has been granted after a much longer period. (Purcell v. M’Namara, 14 Ves. 91. Pickett v. Loggon, 14 Ves. 214. Hatch v. Hatch, 9 Ves. 292. Murray v. Palmer, 2 Sch. & Lef. 474.)
Having arrived at the conclusion, that the validity of Cramer’s purchase for the Waterford creditors, cannot be sustained; and that the remedy has not been lost by lapse of time; I now come to the last question in the cause;— To what relief are the complainants in this case entitled ? It is urged by the defendant’s counsel that, if the purchase by the attorney was illegal, it was a fraud upon the whole
The premises having been purchased, by Peebles, bona without notice of any fraud or illegality in the sheriff’s sale, the purchase made by him must be sustained; and of course there can be no resale upon the execution. (Per Brakenridge, J. 3 Binney, 64.) The remedy in cases like the present goes to the persons who had an interest in the property before the sale, and no other person can apply to set aside the sale. (2 Hen. & Munford, 245. 5 JohnRep. 47.) In this case the whole valué of the property, being insufficient, to satisfy the judgment on which it was sold, no person, except the complainants, could have any interest in the remedy, unless it might be Berry, the defendant in the execution. He has no interest in the distribution of the fund raised by the sale to Peebles, and therefore is not a necessary party to this suit. And it may not yet be too late for him to compel the plaintiffs in the judgment, to allow the whole amount of the purchase money paid by Peebles, towards satisfying the judgment, if the purchase at the sheriff’s sale should be considered illegal, as against him.
In cases of purchases by trustees, or others who are not authorized to purchase without the consent of their principal or cestuy que trust, the rule of Equity is, that if the purchaser has not divested himself of the property, it is to be put up again, at the amount of the former bid, together with the value of beneficial and lasting improvements, made thereon after the sale, and if it brings nothing more, he is to be holden to his purchase. But, if he has parted with the estate he may be compelled to account for all the profit which has been made by him on the resale. (Per James, Ch. 4 Des. Ch. Rep. 503. Davoue v. Fanning, 2 John. Ch. Rep. 271. Randall v. Erington, 10 Ves. 423. Lester v. Lester, 6 Ves. 631. Per Tilghman, C. J. 4 Binney, 44. Ex parte Reynolds, 5 Ves. 707. Fox v. Macreath, 2 Bro. Ch. Ca. 400. Ex parte Lacey, 6 Ves. 625. Butler v. Haskell, 4 Des. Ch. R. 716. Lord Hardwicke v. Vernon, 4 Ves. 417.) And according to the decision in Fox v. Macreath, .he must pay interest, upon the profits which he has made upon the sale.
The following decree was entered in the cause:
“ This cause having been heard on the pleadings and proofs, at the stated term of this Court, in March last, and
’
And it is further ordered and decreed, that if any of the said five last mentioned defendants shall, under this decree, be compelled to pay more than his or their equitable proportion of the said sums, so adjudged to. the said complainants, or of the costs of this suit, such defendant or defendants may apply to a Master in Chancery, or to the Clerk of this Court, on the foot of this decree, and obtain a report of what has been received and paid out by the said last named defendants, respectively, and a statement of the account thereof between them, on the principles of this decree, to the end, that, on the coming in of the said report, such further order and decree may be made for an equitable contribution among the said defendants, as shall be just. And the usual liberty is given, to the said Master, or Clerk, to examine the parties, and all other persons, on oath, as witnesses, and to compel the production of books and papers, upon taking such account, as he shall deem proper and necessary.”