Cohen v. Wagner

Dorsey, J., delivered the opinion of this court. Had the proof sustained that part of the exceptant’s first exception, which alleges that the said Mendez I. Cohen, being a stockholder, and interested in the proceeds of said property, after the sale was advertised by the said trustee, and about two or three weeks before the sale, applied to the said J. H. B. Latrobe to know at what sum he intended limiting the price of the sale of the said Theatre and property, and was informed $20,000-, that a few minutes before the sale, the said Latrobe informed the said Cohen that his limit was $12,500, and that in consequence thereof his interests in the sale had been prejudiced, such an objection to the ratification of the sale could not have been successfully resisted. But the allegations thus made, being wholly disproved by the testimony in the cause, the validity of the sale stands unaffected by it. The second ground assigned in the first exception against the ratification of the sale is, “ that the day of sale was Saturday, ■ the Sabbath of the said Cohen, who was thereby prevented from making arrangements to purchase said property,” as he could not make the purchase on his Sabbath day, or so endeavor as to prevent a sacrifice of said property. Conceding (for the mere purpose of considering it) the sufficiency of this objection, if made in the proper time and manner, let us en-quire whether, under the circumstances in proof in this case, [251] it ought to avail the exceptant. It can derive no support from the allegation preceding it, that two or three weeks before the sale, the trustee informed the exceptant that the limit at which he would sell the property at the approaching sale was $20,000, because the fact of such information has, as above stated, been disproved. Was it made at the proper time?—is then the first inquiry. The exceptant knew the day fixed for the sale for weeks before it took place, and also, that the trustee would fix no limitation as to the price, until the day of sale. If then, the day of sale being his Sabbath, subjected him to the consequences he in his exception ascribes to it, he ought, with all convenient speed, after the day of sale became known to him, to have applied to the trustee to change the day, and apprised him of the grounds of his application. His failure to do this must be regarded as a waiver of all objection to the day of sale, as being a Jewish Sabbath; and he must abide the consequences of his own omission. Under the first exception, a third ground is relied on for withholding the ratification of the sale for $13,000, of property alleged to be “well worth $15,000 or $20,000, or more.” From the views entertained of the effect which would result from the asserted inadequacy of the price, if it, in truth, existed, it is deemed unnecessary to enquire whether the assertion be sustained by proof? The practice of opening the biddings in chancery sales, upon the mere offering of an advance upon the purchaser’s bid, has not been adopted in Maryland ; and its non-adoption is founded on cogent reasons of justice and policy. The doctrine that mere inadequacy of price in a chancery sale, where the sale has been made conformably to the powers and directions specified in the decree, is not of itself sufficient ground for vacating the sale, has been so frequently announced by the judicial tribunals of this State, that a special reference to authorities to sustain it is deemed unnecessary. A sale thus made will not be set aside, or its ratification refused for inadequacy of price, unless the court believe that such inadequacy was the result of fraud, surprise, mistake, or unfairness in the sale. And the inadequacy of [252] price is for the most part regarded as the inducement to the action of the court, after the establishment of a cause deemed sufficient to warrant its nullifying interposition. The case of Tyson vs. Mickle et al. 2 Gilt, 384, which has been referred to as an authority in the case before us, cannot have the slightest weight on the question now to be determined. The cases are wholly dissimilar; differing as widely in their facts as in the principles of law, by which they must be decided. In the case before us, the trustee made the sale in strict conformity to the powers and directions given to him by the decree of the Chancery Court; and, therefore, the purchaser having entered into the contract with a duly authorized agent, at a bona fide sale, fairly conducted, had a right to insist upon its validity—although at the time it was made, it operated prejudicially to those whose interests it was designed to pass. But, in the case of Tyson vs. Mickle et al., the purchaser knew, or is presumed to have known, at the time of his purchase, that he entered into a contract with an unauthorized agent,—and that its affirmance, unless assented to by the parties concerned, depended upon the equitable circumstances, with which it appealed to the justice and conscience of the Chancellor; and that if any of the parties interested objected to the sale, and showed that the property was sold at less than its fair market value at the time of sale, or at less than it would have brought’ had the sale been made at public auction, according to the terms of the decree, that the sale would not be ratified. In the making of such an unauthorized sale, the trustee is the agent of the Chancery Court, and not of the parties to the suit,—and, therefore, it is not to be set aside as a matter of course, if objected to by one of the parties. But it is to be vacated by the Chancellor, if it appear to him that the objectant was damnified by the sale; that its vacation is required as an act of justice to him. It was the absence of all proof of such damnification or injustice to the objectant, that induced this court to ratify the sale made in the case of Tyson vs. Mickle et al. That the inadequacy of price alleged as existing in the sale [253] before us would not, in the State of New York, be regarded as a sufficient ground for refusing to ratify or nullify such a sale, is abundantly shown by the cases of Williamson vs. Dale and others, 3 Johns. Chan. R. 290. Woodhull vs. Osborne, 2 Edwards’ Ch. R. 614. American Insurance Company vs. Oakley, 9 Paige, 259; and Tripp vs. Cook, 26 Wendell, 143. The second exception states that the exceptant was surprised and prejudiced in his rights by the sale. If it be true that he was surprised by the sale, it should, according to the proof in the cause, be attributed to his own want of foresight and caution. If he has been prejudiced in his rights, it is attributable to the same causes. He has nobody to complain of but himself. The trustee appears in all things faithfully to have discharged the duties of his trust. The third exception is, that the sale was made by the said trustee through an auctioneer, who, by his crier, put up said property at $13,000; that said bid was by the auctioneer, and there was no bid in fact made at the sale above, or at that sum by any person. The proof in ‘ the cause clearly shows that there was a real bid of $13,000 made for Wagner, the purchaser, and that on that bid the property was struck off to him. Whether the bid was made by Wagner, or by some other person acting in his behalf, is wholly immaterial. Neither in practice, nor in principle, is it necessary or usual to announce at the time the bid is received the name of the bidder; nor is it at all necessary that it should be known to the bidders, or persons attending the sale, before the property is struck off. The third exception, therefore, cannot avail the exceptant. The fourth exception is, that the said trustee, before the sale, told the auctioneer that the limit was $13,000, and if he got no bid above that, to strike it, off to Mr. Wagner. How this communication from the trustee to the auctioneer can form an objection to the sale, it is difficult to divine. It is not pretended that it prevented any other person from bidding a larger amount; nor does it appear how it could have had any such tendency. Such a communication was the natural, legitimate result of the circumstances under which the sale was about to [254] take place. It forms not the shadow of an objection to the validity of the sale. The fifth exception is, that in substance it was not a public sale, though so in form. There is nothing in the proof taken in the cause to sustain this exception. Both in form and substance, it was a valid public sale,—and the Chancellor’s final order for the ratification thereof should be affirmed by this court, with costs. From what has been stated in this opinion, we are not to be understood as deciding, that the inadequacy of price may not be so gross and inordinate as to furnish evidence of such misconduct or fraud in the trustee as would vitiate his sale. order, affirmed.