Central Trust And Savings Company v. Chester County Electric Company
| Decision Date | 04 October 1910 |
| Citation | 77 A. 771,9 Del.Ch. 123 |
| Court | Court of Chancery of Delaware |
| Parties | CENTRAL TRUST AND SAVINGS COMPANY, Trustee, v. CHESTER COUNTY ELECTRIC COMPANY and WILLIAM M. HOPE, Receiver of said Chester County Electric Company |
OBJECTIONS TO CONFIRMATION OF SALE MADE IN A SUIT TO FORECLOSE A MORTGAGE. Pursuant to an order of the Chancellor William M. Hope, receiver of Chester County Electric Company one of the defendants in this suit, sold the mortgaged property and made return thereof, and notice was given by newspaper advertisement that objections to the confirmation of the sale should be filed on or before Monday, September 26th, 1910, and be heard on October 3rd, 1910. Confirmation of the sale was objected to by Elisha W. Meloney, on the ground of inadequacy of price, and the matter was heard on said objection and answer thereto by the purchaser, the substance of which appear in the opinion.
Petition of Elisha W. Meloney dismissed.
Arley B. Magee, for the objector.
James W. Ponder and J. Hector McNeal, (the latter of the Philadelphia Bar) for the purchaser.
William M. Hope, the receiver, who, as one of the defendants, was appointed to make the sale under the decree of foreclosure of the mortgage, accepted from the Central Trust and Savings Company, trustee, a bid of $ 10,000; it being the only qualified bidder at the sale. Objection to the confirmation of the sale is taken by a holder of bonds of the company upon the ground of gross inadequacy of price; he alleging that the property sold is worth upwards of $ 30,000, and that there was probably an unnamed purchaser who would bid $ 20,000 at a resale. In answer to this the purchaser filed a sworn answer, alleging itself to be the trustee for the bondholders, who had deposited with it bonds aggregating $ 165,000, a part of the $ 190,000 of bonds issued and outstanding, and that it bid in the property for the committee of the depositing bondholders; and, further, that Elisha W. Meloney, the objecting bondholder, and all the bondholders, had equal opportunity to join with the majority of the bondholders, but he had refused to do so.
Evidence of witnesses was heard as to the value of the property, and their estimates varied from $ 30,000 to $ 50,000, and the objecting bondholder does not expect a bid of more than $ 20,000 at a re-sale. The possibility or probability of a higher bid mentioned in this indefinite way will not be considered as of weight upon the question of the confirmation of the sale. It has been held that a definite offer of a higher bid at a re-sale, obtained subsequent to the sale will not justify the refusal of confirmation. Rogers v. Rogers Locomotive Co., 62 N.J.Eq. 111, 50 A. 10. Nor the guarantee of an advanced price at a re-sale. Harris v. Gunnell, 9 S.W. 376, 10 Ky. L. Rep. 419. Nor an opinion that a higher price can be obtained at a re-sale. Fidelity, etc., Co. v. Mobile, etc., Ry. Co. (C. C.), 54 F. 26. The courts have also held that mere inadequacy of price will not be sufficient, in the absence of fraud or irregularity in the manner of conducting a sale. Booth's Ex'r v. Webster, 5 Del. 129, 5 Harr. 129; Cowen v....
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