Patterson v. Latrobe

Miller, J., delivered the opinion of the Court. We éntertain no doubt as to the power of a Court of equity, upon a proper case being made by the alleged [195] purchasers, to rescind an order ratifying a sale reported by its trustee. Whether the appellants are entitled to that relief in the present case, depends first upon the question whether they ever became purchasers, in fact or not, and that question must be determined by the evidence in the record. The record as supplemented by agreement of counsel, shows, that upon a bill filed in the Circuit Court of Baltimore City in 1866, for the sale, for purpose of partition, of certain land in Queen Anne’s County, a decree for a sale was passed, and J. A. Preston, Esq., was appointed trustee to make the same. The parties who were entitled to the land by descent, and to the proceeds of sale, were three brothers, John H. Patterson, Frederick E. Patterson and James Orville Patterson, and the children of a deceased brother, Alfred Patterson, all of whom were parties to the proceedings which resulted in the decree. The trustee advertised the property on two or more occasions without effect, and finally offered it at the Exchange on the 10th of November, J 868, and on the 13th of that month he reported to the Court, that he had sold the property at public action at the Exchange “to Frederick E. Patterson, James Orville Patterson and John H. Patterson, for the sum of $5000, the said parties being the highest bidders therefor.” The sale thus reported was duly ratified by an order of Court, and an account was stated by the auditor distributing the net proceeds to the parties interested, which was also finally ratified on the 26th of December, 1868, and the trustee was directed to apply the proceeds of sale accordingly. The alleged purchasers, however, never paid any part of the purchase money, and no effort was made by the trustee to collect it from them. As soon as they learned they had been reported as purchasers, they at once disavowed the purchase, insisted they never became and never intended to become the purchasers of the property, and on the 7th of August, 1876, [196] filed their petition praying that the order of ratification be rescinded and the reported sale rejected. The testimony taken under this petition and the answers thereto is quite voluminous, and we have examined it with care. It has convinced us that the appellants never did purchase this property, and that the trustee reported them as purchasers under a mistaken or erroneous impression upon the subject. In his own testimony he is not positive, but says he understood the property was purchased by them, and when the bid of $5000, at which it was struck off was made, he is not certain whether it was made by Mr. Harris or Mr. Frederick Patterson, but when it was made he understood the property was purchased by these three parties, and he believed he had authority to report them as purchasers, and would not have done so unless he had so believed. But the decided weight of evidence, and the circumstances of the case, show that this bid was made by Mr. Harris at the instance and instruction of Mr. Frederick Patterson, and with the consent of the trustee, to prevent the property from being sold at a less sum, (the expectation being that more would be bid) and not for the purpose of binding these parties or any one thereto, and that if more was not offered the property should be withdrawn. That seems to have been the understanding of the transaction on the part of Frederick E. Patterson, James Orville Patterson, as well as of Mr. Harris himself who made the bid. John H. Patterson one of the parties reported as purchaser was not present at the time, and knew nothing of what took place at the sale. The delay in filing the petition is also clearly and satisfactorily explained, and there is no possible reason why the relief asked should not be granted, unless the appellees, Messrs. Latrobe and Fisher, have acquired some equitable rights which ought to prevent it. It appears that these gentlemen loaned money to James Orville Patterson, and took orders upon the Clerk signed [197] by him, of which the following is a sample. “ Mr. Brewer: enter my interest in this case to the use of F. O. Latrobe, to the extent of $375.” These loans were effected through the agency of the trustee, and the orders were filed in the case. It further appears that these advances were made, and the orders given after the sale had been reported and ratified, and also after the auditor’s account, distributing the proceeds had been stated and ratified. Now if these orders operate as assignments pro tanto of Orville Patterson’s distributive share of the proceeds of sale, (and we by no means intimate an opinion that such is not their true construction and effect,) the assignees have no interest in holding him to this purchase, for it is clear that what he would receive as distributee, is less than what he would have to pay as one of the three purchasers. Upon that construction of the orders, therefore, it is plain these appellees would be benefited instead of being injured, by setting the sale aside, and having the property sold to some other party. But suppose the effect of the orders is to assign the equitable interest in the land which he acquired as purchaser, what was that interest ? Simply a right to an undivided third of the land, upon payment of one-third of the purchase money. But he has never paid anything, and the record shows he had assigned all his property for the benefit of his creditors after this sale had been reported and ratified. In that state of case we can hardly suppose the appellees would contend that it was the duty of the Court to direct the trustee to collect the whole purchase money from the other two purchasers, and then make a conveyance to the three, so that their assignments would fasten upon the interest of Orville thus acquired. Such a proceeding would be most inequitable, for it is nothing less in effect than compelling Frederick and John to pay the debts of Orville. Nor can the Court hold on to Orville as purchaser and release the others, even if that would be of any possible benefit to the appel [198] lees. The sale is to the three, and it must be ratified or rejected as an entirety. Whatever view therefore maybe taken of the case, we are of opinion the appellees have by virtue of these assignments acquired no equities against the relief prayed by the appellants. (Decided 25th March, 1879.) The order dismissing the appellants’ petition will therefore be reversed, and the cause remanded, to the end that the sale be vacated and the property resold under the decree. Order reversed, and cause remanded.