State Bank v. Brown

128 Iowa 665 | Iowa | 1905

Deemer, J.

The issue in.the case is a narrow one. It-appears from the testimony that while the action was pending, and before the issues between plaintiff and defendant Cooper were settled, tbe case went to decree against tbe original mortgagors Brown. Thereupon a special execution was issued, and the land covered by the mortgage was advertised for sale. At the appointed time it was offered for sale by the sheriff, and plaintiff in execution, by its attorney, through mistake or a claimed mistake, and without authority, as is claimed, bid therefor the sum of $13,000, which was very much more than the amount due, with costs.

On the following day the attorney, as he says, discovered his mistake, and immediately informed the sheriff of his miscalculation and want of authority in the premises; that his client would not make the bid good, and he asked the sheriff to declare the sale a nullity and to resell the property. This the sheriff did, and the property was again put up and resold to the plaintiff in execution for something like $635. Defendant Cooper learned of the bid of $3,000 the next day after it was made, and he insisted that the sheriff carry out the sale, and compel plaintiff to make its bid good; but this the sheriff refused to do.

This proceeding is in effect an attempt to hold plaintiff to the first bid, and .to recover the difference between it and the amount of plaintiff’s foreclosure judgment, on the theory that this bid was irrevocable, or if not, that the sheriff had no just grounds for setting the first sale 'aside and for refusing to hold plaintiff thereto.

1- S^VTI0N o?fbid?ment Code, section 4033, provides: “ When the purchaser fails to pay the money when demanded, the judgment holder or- his attorney may elect to proceed against him for the amount; otherwise the sheriff shall treat the sale as a nullity, and may sell the property on the same day, or after postponement as above authorized.”

Bnder this statute it is quite clear we think that no one but the judgment holder or his attorney, which practically means the same thing, may proceed against a bidder - at the execution sale, who fails to pay the amount of his bid, when demanded. If neither of these persons do so, then it is the duty of the sheriff to resell the property. This is a wise provision, for the judgment creditor should not be held liable for the results of a lawsuit which he does not authorize or care to undertake. Moreover, the sheriff should not be required to employ counsel to enforce any bid which may be made and afterwards withdrawn.' Again, he should not be made liable for a mistake in judgment as to the responsibility of bidders. Wisely, we think, this matter was left with the holder of the judgment.

2. Refusal or WITHDRAWAL of bid. But, if wrong in this, the sheriff undoubtedly has some discretion in the matter. For reasons which appear good and satisfactory to him, he may refuse a bid, or, having accepted it, may before the transaction is X . ^ closed repudiate the same or authorize its withdrawal and resell the property. That our construction of this statute is correct, see Reese v. Robbins, 51 Iowa, 282; Fuson v. Ins. Co., 53 Iowa, 609; Harpham v. Worthington, 100 Iowa, 313; Bradley v. Geo. Challoner’s Sons Co., 103 Ill. App. 618; Bisbee’s Lessee v. Hall, 3 Ohio, 449.

Appellant’s counsel seem to think that the casé is ruled by Downard v. Crenshaw, 49 Iowa, 299. But a reading of that decision will show that it is distinguishable. In that case the officer did nothing, except to make a return of the facts into court. He did not consent to the withdrawal of the bid, nor did he resell the property. Under 'such a record we held that a second execution and sale was unau~ thorized and invalid. This distinction is pointed out. in the Beese Case, supra, and also in the Harpham Case. Some language used in the opinion in the Downard Case seems to support appellant’s contention; but it is pure dictum, and •was in no way essential to the conclusion reached.

„ d[sposiSonEE: of surplus. Aside from this, there are several reasons defendant Cooper is not entitled to the relief prayed for by him. He was not entitled to any overplus until other liens against the property were paid. That there were 'such liens is clearly shown and practically undisputed.

i. sale in vacation. Again, the land consisted of 100 acres, and it was sold in bulls, without first being subdivided and offered in separate tracts. Such a sale was subject to be set aside on proper application, and the bidder was entitiled to a certificate which would be free from such an attach. Boyd v. Ellis, 11 Iowa, 98.

- s. Enforcement privity. Cooper was not in privity to the bid made by plaintiff’s agent and attorney, and is in no position under the facts disclosed by this record to insist upon the acceptance thereof. This was primarily for the sheriff. If he negligently or purposely failed to perform his-duty, he may be held liable to the defendant Cooper in a proper action, but there is no sale here to_ be enforced, except the last one which was fully consummated before this action was commenced.

It may be, as counsel contends, that equity treats that as done which ought to have been done; but, as something else was in fact done in the instant case, pursuant to a statute authorizing it, there is no' room for the application of this maxim. We do not say that an execution debtor or his assignee may not in a proper case bring action to enforce a sale on execution; but this is not one of the cases where he may do so.

6 agency of sheriff. The sheriff was an agent for the defendant Cooper, as well as for the other parties, and he in virtue of statutory authority treated the bid and sale as a nullity, and so re-P01”^ to the court. As he could not have enforced the bid, neither may the defendant Cooper. A number of respectable authorities hold that in no event may an execution defendant bring action to enforce a bid at sheriff’s sale. See People v. Stelle, 103 Ill. 467; Adams v. Adams, 4 Watts, 160; Galpin v. Lamb, 29 Ohio St. 529; Armstrong v. Vroman, 11 Minn. 220 (Gil. 142), 83 Am. Dec. 81; Laverty v. Chamberlain, 7 Blackf. (Ind.) 556; Freeman v. Husband, 77 Pa. 389; Roberts v. Westbrook, 1 Cold. (Tenn.) 115; Burbank v. Dodd (Or.) 4 Pac. Rep. 303. To the contrary vide, Meherin v. Ambrose, 131 Cal. 681, 63 Pac. Rep. 1084, 54 L. R. A. 272; Howison v. Oakley, 118 Ala. 215, 23 South. 810. A few of the cases, holding to the affirmative are in States having the reformed procedure, while some of them are not. We need not at this time decide which is the proper rule for this State, as the sheriff under our statute had the undoubted right under the showing here made to treat the first bid as a nullity and to resell the property. When he did' this, there was no other bid to enforce.

Defendant did nothing in reliance upon the first bid, and there are no elements of estoppel in the case. He is seeking a mere technical advantage, and we are disposed to agree with the trial court in its finding that the sheriff had authority under the circumstances shown to accept the withdrawal of Hie first bid as having been made through mistake and without authority, and to resell the property. If the statute heretofore quoted is to be given any effect, and it must certainly be regarded as controlling, for the entire matter is statutory, it follows that -the sheriff had authority to disregard the first bid and to resell as he did.

7. withdrawal of bid: costs. It is contended, however, that, as plaintiff did not pay the costs of the first sale, it is in no position to rescind. As the property was resold under the first execution, and there was no readvertisement, we do not know what ' costs there could have been which were made unavailing. True, in some of 'the cases cited in support of this opinion the costs were paid, but this was not regarded as controlling. And we may say that there may be cases where the costs should be paid as a condition to the annulment of a bid; as, for example, where the first sale is set aside and a new bill of costs is made in order to effectuate a sale. But in this case, plaintiff»being a purchaser at its own sale under a judgment in its favor, it was not bound to pay the costs in order to get rid of its bid.

Defendant Cooper might easily have protected himself 'by bidding at the second sale. His counsel, as we understand it, was present at that sale, but he made no bid. Moreover, defendant Cooper, as the holder of the equity of redemption, could easily have protected himself by redeeming. He is, as it appears to us, seeking to take advantage of a mere technicality. There are no equities in his favor, 'and the decree must be, and it is, affirmed.