15 N.Y.S. 852 | N.Y. Sup. Ct. | 1891
The motion for an order directing a resale of the premises to foreclose a mortgage on which the above action was brought has already been disposed of, leaving still for determination the question whether the plaintiff is entitled to an order adjudging the purchaser at the sale liable for any defi
The cases on this subject are ably and exhaustively collated and discussed in the case of Metropolitan El. R. Co. v. Manhattan Ry. Co., 14 Abb. N. C. 252, wherein the principle is thus stated: “It will not be denied, I imagine, that as between natural persons, where an agent or trustee has a personal interest opposed to that of the principal, or where one acts as agent of both parties to the contract, although he may have no per
The principle underlying these decisions is equally as applicable to an auctioneer as to any other kind of agent. Strictly speaking, the auctioneer, as before stated, is the agent of the seller in making the sale; but when the property is struck off he becomes also the agent of the purchaser, to the extent of binding both parties by his memorandum of sale. It has therefore been suggested that, whether interested or not in the property, his duty was to obtain the highest price that could be had for the property. A distinction, however, is to be observed between a case where the auctioneer is and where he is not interested in the property itself. In the former, the temptation may be present to impose on bona fide bidders by increasing the price beyond the actual bids received. The fact that the auctioneer’s fees are fixed bylaw, and are the same whether the parcel sold brings a large or small price, may be urged to support the view that this was intended to put the auctioneer in a position of entire indifference, so that lie might perform his legal function of acting honestly between buyer and seller, thus removing any inducement to get more than the price honestly bid. As said in Ex parte James, 8 Ves. 837: “This doctrine as to purchases by trustees, assignees, or persons having a confidential character stands much more upon general principles than upon the.circumstances of any individual case. It rests upon this: that the purchase is not permitted in any case, however honest the circumstances, the general interests of justice requiring it to be destroyed in every instance, as no court is equal to the examination and ascertainment of the truth in much
This, and many other cases that might be cited, would be authority for the position that it is the principle that one is interested in the property, and not the extent of his interest, or that one has a confidential relation towards others, be that relation greater or less, that should determine the conclusion to be arrived at. As already stated, the doctrine stands much more upon general principle than upon the circumstances of any individual case. My conclusion, therefore, is that, the auctioneer having been a party to the' foreclosure suit, and his entire family, including himself, having an interest in the property sold, his failure to disclose this fact to the bidders at the sale rendered the same voidable, and subject to be set aside at the instance of the purchaser thereat. The motion to hold such purchaser liable for any deficiency that may arise on a resale, by reason of his refusal to complete his purchase, should therefore be denied.