Detroit & Sec. Trust Co. v. Tuller Hotel Co.

• Decision Date: 27 February 1931
• Docket Number: No. 168.,168.
• Citation: 235 N.W. 203,253 Mich. 415
• Court: Michigan Supreme Court
• Parties: DETROIT & SECURITY TRUST CO. v. TULLER HOTEL CO. et al.

253 Mich. 415

235 N.W. 203

DETROIT & SECURITY TRUST CO.

v.TULLER HOTEL CO. et al.

No. 168.

Supreme Court of Michigan.

Feb. 27, 1931.

Appeal from Circuit Court, Wayne County, in Chancery; Arthur Webster, Judge.

Suit by Detroit & Security Trust Company against Tuller Hotel Company and others. From an order confirming a sale of the Tuller Hotel Company property on mortgage foreclosure, defendants appeal.

Affirmed.

Argued before the Entire Bench, except BUTZEL, C. J.Abram W. Sempliner and Edward N. Barnard, both of Detroit, for appellants.

Wiley, Streeter, Smith & Ford, of Detroit, for appellee.

POTTER, J.

This is an appeal by the receiver of the Tuller Hotel Company, a Michigan corporation, from an order of the trial court confirming the sale, on mortgage foreclosure, of the Tuller Hotel Company property, in Detroit, September 3, 1930, for $3,015,194.15. At the time of the sale there was due on the mortgage, principal and interest and costs of foreclosure and sale, $3,781,262.30, leaving a deficiency, resulting from the foreclosure sale, of $766,068.13. Before the general creditors can receive anything, if this sale is set aside and a resale ordered, the property would have to bring an amount sufficient to cover the deficiency of $766,068.13, taxes and accumulated penalties of approximately $400,000 and the additional bond interest and costs of approximately $10,000, or more than $1,000,000, in addition to the price realized at the sale under consideration. The bondholders who, if this sale is confirmed, stand to lose the amount of the deficiency, $766,068.13, are asking confirmation of the present sale. There are appraisals indicating the property is worth more than the sale price, but these were made by experts in the heyday of material prosperity and paper profits, when it was claimed we had reached a new era of prosperity and all things were valued on a new and permanently higher plateau of prices; before the late price deflation and comparative cessation of speculative mania. If made now, such estimates of value would have to be made in the light of the present more settled value of property. No one has guaranteed the property will bring more than it was sold for at the sale under consideration if ordered resold. We cannot, on the record, hold this property was sold for a grossly inadequate price. The sale was public. No one was prevented from raising the mortgagee's bid. The mortgage was foreclosed in equity. Everyone interested...