Harvey v. Kinston Knitting Co.

• Decision Date: 21 December 1927
• Docket Number: 220.
• Citation: 140 S.E. 746,194 N.C. 734
• Parties: HARVEY v. KINSTON KNITTING CO. et al.
• Court: North Carolina Supreme Court

140 S.E. 746

194 N.C. 734

HARVEY v. KINSTON KNITTING CO. et al.

No. 220.

Supreme Court of North Carolina

December 21, 1927

Appeal from Superior Court, Lenoir County; Cranmer, Judge.

Action by C. Felix Harvey against the Kinston Knitting Company and others, wherein the Virginia Trust Company on its own motion was made a party. From an order confirming the sale of the property of the Kinston Knitting Company, over objections of H. E. Moseley and others, they appeal. Affirmed.

Confirmation of sale, ordered by court, of property of insolvent corporation held conclusive where purchaser's bid was reasonable and sale fair.

Civil action to dissolve an insolvent corporation and to wind up its affairs by the aid of receivers, who duly qualified, sold the property of the corporation under order of court, and submitted their report for confirmation:

The plaintiff alleges in his complaint:

"That further, if the property could be sold (as plaintiff believes it can be sold) subject to the lien of the Virginia Trust Company, so that any purchaser could assume such indebtedness under the terms of same, the property, as plaintiff is advised, informed, and believes, would bring more, and such purchaser would be relieved of raising so large an amount in cash or otherwise as directed by the court."

Later the Virginia Trust Company, by petition duly filed in the cause, comes in and sets up:

"That in accordance with the seventh paragraph of the complaint in this receivership action, the said Virginia Trust Company, in making itself a party, does hereby agree and authorize the court, wherein this cause is pending, to enter order accordingly, that a sale of the properties of the Kinston Knitting Company may be had subject to the said Virginia Trust Company's lien herein set forth, and that any purchaser under and by virtue of such sale may have the privilege of assuming the said payment of the Virginia Trust Company's indebtedness herein set up under the terms thereof, but that such sale shall in no wise affect the validity of said indebtedness in said lien and that the said lien shall be as binding under the purchase of the properties as outlined herein as if the same remained in the hands of the original debtor, the purpose hereof being to enable any purchaser to make bid and as a part of said bid to assume the indebtedness set out in this petition, which indebtedness shall remain protected under the said lien herein set forth."

The order of sale provides:

"(1) The said real and personal property shall first be offered for sale freed and cleared from all liens, including the liens held by the Virginia Trust Company, trustee.

(2) Immediately after the sale free from liens, the same said property shall be offered subject to the lien held by the Virginia Trust Company, trustee, aforesaid, so that the purchaser thereof shall take the said property burdened with and subject to the said lien aforementioned to the said Virginia Trust Company, trustee. The said receivers shall report to the court both bids hereunder, together with their recommendation as to the bidder or best bid."

The...