Koontz v. Northern Bank

Mr. Justice FIELD delivered the opinion of the court. There is only one question in this case which we deem it important to consider, and that is, whether the deed of the receiver, in the suit of Bacon and others v. Robertson, passed to Calhoun a good title to the property mortgaged by him; and upon this question we have no doubt. The suit of Bacon and others v. Robertson related- to the effects of the Commercial Bank of Natchez in .the bands of the defendant, who had been appointed trustee under a proceeding for the forfeiture of the charter of the bank, and presented a case in which it was eminently proper that a receiver should be appointed of the effects. No question' was made as. to the legality or propriety of the appointment. The premises in question, consisting of a house and lot in Natchez, constituted a portion of these effects. The order of the court, entered at its November Term in 1857, empowered the receiver to sell the lands, or any part of them, belonging to the bank, upon such terms as he riiight deem best for the interest of all parties, provided he should not sell any of the lánds on a longer credit than one, two, or three years; and in all cases should retain a lien or take a-deed of trust on the lands. Under the authority thus conferred, the receiver sold the property in controversy in March, 1860, to Calhoun, for the sum of nine thousand and nine hundred *201 dollars, and executed and delivered to him a deed of the premises, reciting that it was'made by the grantor, as receiver, and in consideration' of the sum specified, the receipt of which it acknowledged. Soon afterwards the deed was placed on the records of the county. In May, following, the receiver reported to the court that he had sold the' premises for the consideration stated, and prayed that the sale might be confirmed. The court referred the report to a master to exámine into its sufficiency and correctness. The master reported that it was correct, and recommended its confirmation, The court thereupon, ordered that the master’s report be in all things confirmed. This confirmation carried with it the confirmation of the sale into which the master was required to examine. Soon afterwards Calhoun went into possession of the premises purchased under the deed from the receiver, and remained in possession in person, of ..by his tenants, up to .the period when the mortgage in suit was executed, in January,. 1867, and until his surrender to Koontz, the present receiver. There was undoubtedly-an irregularity committed by the receiver in executing his conveyance before the sale was confirmed by the court, and until then the contract of purchase was not binding upon that officer. But his conveyance was not on that account void; it was only voidable. If the deed had been executed after the confirmation, it would' have' taken effect by relation as of the day of the sale. * ’ If the confirmation had been denied, the deed,'resting upon the sale, would have become inoperative. But the confirmation having been made, all objection to the time at which .the deed was executed is removed. . The authority conferred by the court upon the receiver to sell, carried-with it authority to give to the purchaser évidepce of a transfer of title. And that the court intended he snould exercise this implied authority, bj^ executing deeds' where land was sold, is evident from -the requirement that *202 he should, iu case of sale on credit, retain a lien or take a deed of trust on the lands from the purchaser. The report of the receiver does not state in terms that the sale to Calhoun was made in cash; it only discloses the fact that a sale was' made, and specifies the amount of the purchase-money. But the only inference which the court could reasonably draw from the language, in absence of any-statemeut that the sale was on credit, was undoubtedly that it was a cash sale. It is clear that the court so understood the transaction. The receiver so treated it by the immediate execution and delivery of a deed reciting the payment of the stipulated consideration, and omitting to take iu return any trust-deed from the purchaser. If the fact were otherwise, and the court was deceived by. the report of the receiver or master, and the purchaser participated iu creating the deception, it could, undoubtedly, at any time before the rights of innocent purchasers had intervened, have set the whole proceedings, including the deed, aside. But after the rights of such third parties had intervened, its authority in that, respect could only be exercised consistently with protection to those rights. . A purchaser under a deed from a receiver is not bound to examine all the proceedings in the case in which the receiver is appointed. It- is sufficient for him to see that there is a suit in equity,- or;was one, in which the court appointed a receiver of property; that such receiver was authorized by the court to sell the property; that a sale was made under such authority; that the sale was confirmed by the court, and that the deéd accurately recites the property or interest thus sold. If the title of the property was vested in the receiver by order of the court, it would in that case pass to the purchaser.’ He is not bound to inquire whether auy errors intervened in the action of the court, or irregularities were committed by the receiver iu the sale, any more than a purchaser under execution upon a judgment is bound to look into the errors and irregularities of a court on the trial of thd case, or of the officer'in enforcing its process. If the receiver.in the one case, or the sheriff in the other, *203 omit to perform his whole doty, by which, the parties are injured, or commit any fraud upon the court, and the rights of third parties have so far intervened as to prevent the court from setting the proceedings aside, the injured parties must seek their remedy personally against those officers, or on their official bonds. The interest of parties in the controversy will generally induce such attention to the proceedings as to prevent great irregularities from occurring, without being brought to the notice of the court. The decree of the court is Affirmed. Footnotes [*] Fuller v. Van Geesen, 4 Hill, 171, and cases there cited.