In re Spokane Sav. Bank

• Decision Date: 27 April 1939
• Docket Number: 27352.
• Citation: 89 P.2d 802,198 Wash. 665
• Parties: In re SPOKANE SAVINGS BANK.
• Court: Washington Supreme Court

89 P.2d 802

198 Wash. 665

In re SPOKANE SAVINGS BANK.

No. 27352.

Supreme Court of Washington

April 27, 1939

Department 2.

Proceeding in the matter of the liquidation of the Spokane Savings Bank. On petition of Harry S. Wilson, as liquidator, certain property was ordered to be sold and sale confirmed in Maurice J. McHugh and wife. The Eagle Investment Company thereafter filed petition to set aside the order confirming the sale and to order the liquidator from negotiating further to transfer the property to the purchaser. From an order setting aside the confirmation of the sale, Maurice J. McHugh appeals.

Reversed with directions.

Appeal from Superior Court, Spokane County; Chas. W. Greenough judge.

D R. Glasgow, of Spokane, for relator-appellant.

Robertson & Smith and Hart Snyder, all of Spokane, for respondent Wilson.

Joseph J. Lavin and Robert Weinstein, both of Spokane, for respondent Eagle Inv. Co.

SIMPSON Justice.

July 29, 1938, Geo. H. Jackson, supervisor of banking, through his deputy supervisor, H. S. Wilson, in charge of the liquidation of the Spokane Savings Bank, petitioned the superior court of Spokane county asking for instructions concerning the sale of real estate owned by the bank situated in the city of Spokane. In his petition the supervisor reported two bids for the property. One bid was made by Maurice J. McHugh and wife in the sum of $73,000, payable $10,000 in cash and the balance at the rate of $500 or more per month to include interest at the rate of five per cent per annum, balance to be paid in full at the end of five years, and the seller to pay the first half of the 1938 real estate taxes. It is not necessary to mention the terms of the other bid for the reason that it was not germane to the subsequent litigation.

The court received the petition, and set August 5, 1938, as the date for hearing. Upon the day set the supervisor reported another bid made by the Eagle Investment Company in the sum of $73,075. During the same day the Eagle Investment Company submitted an additional bid which provided for the payment of $73,075 and the assumption by the buyer of the 1938 taxes both on personal property and on the real property in question. On that day a hearing was had and an order entered as follows:

'On this 5th day of August, 1938, this cause came regularly on for hearing by the court on report of supervisor on call for bids re Kingston Apartments and after hearing said report and further report and further bids and the court being fully advised in the premises, it is by the court----

'Ordered, the bid of Maurice J. McHugh and Irene M. McHugh, the same having been increased to $75,000, and the down payment to $11,000, be approved, and the sale authorized, possession to be taken Sept. 1, 1938, and interest to run from said date.'

August 8, 1938, the Eagle Investment Company filed a petition asking the court to revoke and set aside the order confirming the sale, giving as reasons therefor that on August 5 an agent of the corporation was called by telephone and arrived at the court house about the time the hearing was to be held and by reason of the necessity of the computation of figures for the purchase price of the property, there being an amount of the taxes due which could not be accurately computed in the limited time, the agent of the company made a higher and better bid than McHugh, but due to inadvertence and mistake the court accepted the McHugh bid, and that the bid of the Eagle Investment Company, after computing the figures, exceeded the bid of the McHughs by approximately $40. The petitioner then asked that the liquidator of the Spokane Savings Bank be restrained and enjoined from any negotiation until the further order of the court.

The court signed an order restraining the liquidator from negotiating further to transfer the property to McHugh, and set the date of August 12, 1938, as the time for the liquidator to show cause why the restraining order should not be made permanent.

McHugh filed an answer in which he took issue with the Eagle Investment Company's petition.

August 12, 1938, a hearing was had upon the petition of the Eagle Investment Company as the result of which the court vacated and set aside the court order confirming the sale to McHugh, and provided for another sale to be held August 18, 1938. Upon the date last mentioned, the court by order approved a sale to the Eagle Investment Company after it had raised its bid $1000. McHugh has appealed from the order setting aside the confirmation of the sale to him, and urges that the court erred in setting aside the order entered August 5, 1938, in directing the liquidator of the bank to receive further bids for the purchase of the property, in directing the liquidator to accept the bid of the Eagle Investment Company made August 18, 1938, and in holding that there was an inequality between the opportunities of the bidders for the purchase of the property.

At the threshold we are met with a motion to dismiss the appeal upon the ground that the appeal is from an intermediate and not a final order.

In speaking of the right of appeal from an order confirming the sale, we find the following in 35 C.J. 50, § 68: 'Right of Appeal. Since the order may be considered as a final adjudication, an appeal may lie from an order of confirmation or from an order refusing confirmation thereof.' Additional authorities to the same effect are: Wood v. Seattle, 23 Wash. 1, 62 P. 135, 52 L.R.A. 369; Brady v. Ford, 184 Wash. 467, 52 P.2d 319; State ex rel. Sorensen v. Denton State Bank, 126 Neb. 486, 253 N.W. 670; Magann v. Segal, 6 Cir., 92 F. 252; 8 Bancroft's Code Practice and Remedies (1928), 8435,§ 6376; 16 R.C.L. 80, § 59; p. 113, § 81.

The following facts are presented in the record: August 5, 1938, appellant and his attorney appeared Before Judge Huneke and raised his original bid $1,000. The court feeling that appellant had been afforded an opportunity to raise his bid caused respondent Eagle Investment Company to be notified of that fact by telephone, and a Mr. Cooper, representing respondent, presented himself Before the court and was told by appellant's attorney, Mr. Glasgow: 'The bid was $73,000.00, they to pay the last half of the 1938 taxes and your bid was $73,075.00. Now the increase of $1000.00 would make the McHugh bid the high bid.' Mr. Cooper said 'By about __,' and Mr. Glasgow answered 'Ten Dollars.' Besides the $1000 increase in appellant's bid, in addition, both parties raised the amounts of their bids an additional $1000 each. Mr. Cooper said: 'That is all right. They can have it,' and the court stated to Mr. Glasgow: 'That makes your bid $75,000 even.'

At the hearing of August 12, each of the bidders attempted to show that his bid was the better. The difference arose out of the fact that appellant's bid recited that the seller would assume one-half of the 1938 tax, while respondent's bid provided that the buyer would assume all of the 1938 tax.

Computing the net amount of the bids, we find that deducting the one-half of the real property taxes which appellant did not agree to assume in the sum of $909.05, appellant's total net bid is in the sum of $74,090.95, whereas respondent's net bid is in the sum of $74,075.

Notwithstanding the contention of respondent that appellant did not offer to assume the personal property taxes, a consideration of the bid itself, together with the record, convinces us that the respondent's position is not well taken, and that appellant did agree to assume the 1938 personal property taxes.

It is also true that respondent agreed to pay $14,000 in cash, whereas appellant only agreed to pay $11,000 in cash, and the respective bidders were to pay the balance in installments of $500 per month, with interest at five per cent per annum thereon until the balance was paid. Even though respondent agreed to assume all of the real property taxes for 1938, and the appellant agreed to assume only one-half of the same, it is clear that appellant's bid was $15.95 higher than that of the respondent. The mere fact that respondent agreed to pay a larger initial cash sum did not preclude a finding that appellant's bid was higher than that of respondent.

The order from which this appeal is taken does not disclose the grounds for the vacation of the order confirming the sale. However, the trial court gave his reasons as follows: 'As I understand a public auction, the terms must be the same to all of the parties. It isn't one thing to one party and another thing to another party. The conditions are the same to all and the terms are the same. That situation didn't prevail here. Even the terms of the bids by one party were not known to the other. Consequently, I don't believe that the sale was conducted under such circumstances that the best results were obtained for the benefit of the liquidation. By reason of that fact, and particularly in view of the fact that one of the parties has stated under all circumstances here this party would be willing to offer an additional $1,000 for the property.'

In the liquidation of the assets of a bank, it is the duty both of the liquidator and the court to...