84 Va. 586 | Va. | 1888
delivered the opinion of the court.
This suit was a creditors’ bill to subject the property of the Gal
The question for us to consider and decide, then, is whether the chancery court erred in refusing to confirm the sale to Todd, and directing a resale on the basis of the upset bid; the said upset bid being a substantial advance of 10 per cent., or $12,000, on the real property alone. That the course pursued by the chancellor was the usual course, and was in accordance with the unbroken line of authorities in this State, is or must be conceded.. There is no ease to be found, in this State certainly, where this practice has been overruled by this court. The English practice, before the act known as “ The sale of Land by Auction Act,” passed in 1867, (30 & 31 Viet. c. 48, § 7,) in making judicial sales, was to open the biddings, and to allow a person to offer a larger price than the reported highest bid, and upon such offer being made, and a proportionate deposit paid in, to direct a' resale of the property; and this was allowed upon an advance of price, even after confirmation of the sale reported. Ten per cent, upon small sums, and less upon large sums, was considered a sufficient advance to open
The foregoing principles are well settled, and I do not consider that they are at all denied or controverted here. While the English practice has not been so far adopted in some of the. other States, it has been substantially so adopted here. The court selling to satisfy debts has always proceeded upon the principle that it was just to cause the property to bring as much as possible for the benefit of all concerned—the creditor, to the extent of his claim; the debtor, to the extinguishment of his liability so far as the property would go. A fair and just price alone could justify a court in disposing of property within its jurisdiction,—a fair and just price, all things considered; that is all the attendant circumstances having been duly regarded. It may be said that after full notice, an open sale fairly conducted, in the face of such competition as can be attracted, the highest bid which is made is a fair and just criterion of the value of the property at that time; and so, after-stated opinions, affidavits of undervalue, etc., are regarded with but little favor, and estimated as of light weight, in the presence of the fact established by the auction and its results. And if, in this ease, the persons in attendance at the sale on the 20th of April, 1887, had presented no better evidence of undervalue than such opinions and affidavits, it is quite likely that the sale would have been confirmed to Todd at his bid of $120,000, and the matter would have ended there. But before the court had an opportunity to act, before the sale was reported to the court, another person offered a substantial advance of $12,000, which was satisfactorily secured. There was then before the court no question as to the inadequacy of price to be determined. One hundred and thirty-two thousand dollars was offered for the same property, under the same circumstances, and so far as the court was concerned, at the same time, for property which the purchaser claimed the right to buy and have conveyed to him at $120,000.
“Richmond, Va., April 23, 1887.
“Dear Sir:
“I inclose a paper which Mr. Todd desires us to sign, in accordance with our promise. I have left a blank space for your bank. Ho upset bid has been made as yet. If*594 any is made, the court will consider it, and this paper then would be of no service. Please return to me, so that I can hand to Mr. Todd.”
Two numerously signed petitions in the record show that the third-class creditors, and the creditors holding the floating or unsecured debts, asked for confirmation to Mr. Todd at $120,000. These are dated May 6, 1887. On the 9th of May General Anderson perfected and filed his bid of $132,000, with security. Mr. Potts testifies in the cause, having been called as a witness by Mr. Todd, aud claims that liis agreement with Mr. Todd was as Mr. Todd says, “The first mortgage bondholders would agree to let it go at $120,000, unless there was a higher bid from some other quarter, and would not bid beyond that sum, he agreeing to that limit.” Mr. Stokes testified that he agreed, for himself only, that he would not be connected in any way with a combination formed by the creditors to bid against him (Todd) beyond $120,000; that he considers the price inadequate, and that he certainly does not recommend a confirmation, since $132,000 has been offered from another quarter; that he did not understand on the day of sale that he agreed to ask confirmation of the sale if more should be offered by some one else; that when he signed the paper, on the 23d of April, asking confirmation to Todd, he read the letter of Potts to the cashier of the 3sTew Bedford Bank, set out above, and signed it with that understanding—that is, that, if an upset bid should be offered, the paper should go for nothing.
The testimony of Mr. Todd, as well as that of Potts & Stokes, shows that while nothing was said about an upset bid on the 20th of April at the auction of the property, that the agreement, in substance and fact, was that the first mortgage bondholders would let the property go at $120,000 to Mr. Todd, unless there was a higher bid from some other quarter—that is, that they would not combine together, nor with others, to bid more; and, unless there was a higher bid from some other quarter, they would ask for the confirmation of the sale. An
Suppose it be conceded that the property can never bring more than enough to pay off the first and second liens, and that the scores of creditors of the third class and fourth class, who petition so earnestly for a confirmation at the lowest bid before the court, can never have any interest in the matter. "We must remember that the first and second liens aggregate $248,610 78. If Charles P. Stokes represented only his own individual interest in his character as bidder or other transactions at this auction sale—and this he himself distinctly proves, and he is not contradicted—then the debt represented by them aggregated only $109,970 60, or about that sum; and this was less than half of the preferred liens. Upon what principle could the chancery court have refused a bid, made according to the established forms of law, of $132,000, and accept one of $120,000 ? If the court had done this, and the credi
The error assigned as to the action of the court below in refusing a suspension of the decree, in order to allow the appellant to apply for an appeal, will be briefly considered. This
The decree of the chancery court appealed from, will therefore he affirmed.
Hinton, J., dissented.
Decree affirmed.