Horsey v. Hough

• Decision Date: 05 June 1873
• Citation: 38 Md. 130
• Parties: SAMUEL H. HORSEY v. AMELIA M. HOUGH, by her next friend, LEWIS S. HOUGH.
• Court: Maryland Court of Appeals

38 Md. 130

SAMUEL H. HORSEY v. AMELIA M. HOUGH, by her next friend, LEWIS S. HOUGH.

Court of Appeals of Maryland

June 5, 1873

APPEAL from the Circuit Court for Caroline County, in Equity.

Pending the appeal which was taken by the appellee in this case, and which was disposed of by this Court on the 22nd May, 1872, ( Vide Hough vs. Horsey, 36 Md., 181;) affirming the order appealed from and dismissing the bill, the present appellant advertised the mortgaged property referred to in this case, for sale, and returned himself as the purchaser. The appellee to whom the mortgaged property had been conveyed, filed numerous exceptions to the ratification of the sale--some of these were afterward withdrawn--the following only were considered by this Court:

10th. Robert Schuyler having become the highest bidder and purchaser of said land, tendered to Samuel H. Horsey, $1,200 in money, and promised to pay the balance of the purchase money, to wit: $1,175; on the ratification of the sale to him by this Court, and offered to secure said balance by bond with good security; which tender and offer the said Samuel H Horsey refused.

11th. The sale made and reported was not fairly made, but was made fraudulently.

12th. The prices at which the lands were struck off to Samuel H Horsey, were greatly below the value thereof.

A commission was issued and testimony taken and returned, which will be found, for the purposes of this case, sufficiently stated in the opinion of the Court. By agreement of counsel the Court passed a pro forma order annulling and setting aside the sale. From this order the present appeal was taken.

The cause was argued before BARTOL, C.J., STEWART, BOWIE, BRENT and MILLER, J.

Alex. B. Hagner, for the appellant.

Schuyler's "offer to pay $1200 cash, and the balance when the sale should be ratified," " to secure the property," was not a compliance with the terms of sale. Every person who bids at an auction sale, does so with reference to the published terms. Each bid is an offer to pay for the property on the published terms, and the fall of the hammer signifies nothing more than that the vendor accepts the offer, provided the terms are complied with. Story on Sales, sec. 463, (2 d. ed.)

The published terms in this case, which were read in the presence and hearing of Schuyler, and constituted the contract, were cash. "Cash" means ready money--not part on the day of sale, and the residue at a future time.

The mortgagee was entitled by law, on the day of sale, to the debt, interest and costs. Code, Art. 16, sec. 125.

The aggregate of Schuyler's bids scarcely covered the debt and interest, and the costs which had accrued to that day; the debt, interest and costs on the day of sale amounted to $2,361.40; Schuyler's bid to $2,375.00, being an excess of only $13.60 over the amount then due.

So the mortgagee's demand for the whole sum in cash, was neither illegal, harsh nor oppressive.

Mr. Schuyler was simply aiding the next friend of the objectant to "pay off the mortgage," and failing to raise the funds, this plan was adopted to prevent a sale--in the language of Lewis S. Hough, "to secure the property."

If such a bid, under such circumstances, is to be allowed, there will be no end to bidders in bad faith, and the trustee (or mortgagee) compelled to accept them, although they frustrate "the very object and purpose of the sale." Gray vs. Veirs, 33 Md., 22.

There is nothing in the record from which fraud or unfairness in the sale can, in the slightest degree, be inferred. The testimony shows that the mortgagee had but one desire--the recovery of his debt--and that everything which the law or reason required of him was done. The property was fairly advertised, as to name and location; the authority under which it was offered, and the value and condition of the property fully set forth. If there was any unfairness or fraud, it was on the part of Mr. Schuyler, the agent or friend of "the delinquent purchaser, for whose default the property was to be sold," in making bids in bad faith, "designed and intended to delay the appellant in the recovery of his debt." This bad faith can be seen in his offer of $1200, for all the parcels, and when he could not get all, refusing any. Had he been a bona fide bidder there was nothing to prevent him from complying as to one parcel. Yet he never offered to do so.

The price at which this property was struck off to the mortgagee is not so far below the value as to justify this Court in setting aside the sale. The property was subject to a judgment in favor of the State, which amounted on the day of sale to $2,648.42; add this to the amount at which the property was purchased by Horsey, and we have $4,248.42, as the total of purchase money. And while some of the witnesses fix the value of the property higher, none have expressed a willingness to buy at that price, nor has any one informed the Court that a purchaser could be had who would give more, if the property was again offered for sale.

Besides, the mortgagee bought under the threats of a law suit, made by the attorney for the objectant, before the property was offered the second time. To appreciate this objection it is only necessary to remember that the objectant was the purchaser of Kugler's equity of redemption, under an express agreement to pay this mortgage debt; that she failed to perform the covenants in the mortgage; that she endeavored to set up an illegal claim to a reduction of $707, and sought an injunction to restrain the mortgagee from selling the premises; Vide Hough vs. Horsey, 36 Md., 181; that failing in this, she endeavored, through Schuyler, to raise the money "to pay the mortgage;" that, being unsuccessful, it was determined that Schuyler should bid in the property, "offer to pay $1200 in cash, and the balance when the sale should be ratified, to secure the property;" that the mortgagee refused this offer; that the solicitor for the objectant then gave notice that the purchaser would buy a law suit; and that failing under these circumstances, to bring within $775 of the objectant's bid, through Schuyler, which was satisfactory, she comes in and asks that the sale be not ratified, because no one would give more under the inspiration of her threats. She commits the wrong of attempting to "frustrate the very object and purpose of the sale," and, having failed, seeks the aid of this Court to take advantage of it. If there is any inadequacy in the price, it is owing to the acts of the exceptant, through her next friend, and not to any want of judgment, discretion or fairness in the mortgagee; nor is there any other cause which, when viewed in connection with the alleged inadequacy of price, is sufficient to justify setting aside this sale. Glenn vs. Clapp, 11 G. & J., 1; Cohen vs. Wagner, 6 Gill, 251; Johnson vs. Dorsey, 7 Gill, 269.

Thomas J. Keating and J. W. Bryant, for the appellee.

If the appellant had at the time when Mr. Schuyler offered him the $1200, doubted the propriety of accepting less than the entire purchase money, he could have postponed the sale to some future time, and have stated expressly that less than the entire purchase-money would not be deemed a compliance with the terms of sale, and thus have shielded himself from the imputation we now unhesitatingly make, "that he conducted the sale so as to become himself the purchaser at a sacrifice to the appellee, and in disregard of the right of others;" and did more--consummated a sale, which, under the confused circumstances, prevented a fair price being obtained for the property.

For a trustee to refuse a tender of $1200.00 out of a purchase-money of $2375.00, with a promise of full payment on ratification of sale, is certainly in no sense, according to the practice in the Courts of Equity, a non-compliance that will justify a re-sale at a mere nominal price. Mr Horsey should have given Mr. Schuyler a full and fair opportunity to have complied with the terms of sale before again offering, especially as this was the first time the property had been exposed to public sale, and the bid made by Mr. Schuyler for Mrs....