Krabbe's Estate, In re
| Decision Date | 12 August 1957 |
| Citation | 7 Misc.2d 823,165 N.Y.S.2d 541 |
| Parties | In re KRABBE'S ESTATE. Application of Martin C. NELSON for relief from a bid in a judicial sale held in the Estate of Christian Krabbe, Deceased. Surrogate's Court, Suffolk County |
| Court | New York Surrogate Court |
Wells R. Ritch, Port Jefferson, for bidder, Martin C. Nelson.
Henry G. Wenzel, III, Bay Shore, for Public Administrator.
John White, Patchogue, Sp. Guardian for Infants.
HAZLETON, Surrogate.
The successful bidder at a judicial sale of real property in the above estate seeks, by petition dated May 23, 1957, to be relieved from his bid because of alleged legal and equitable considerations hereinafter mentioned.
By order dated September 26, 1956, this court entered an order authorizing the sale at public auction of certain real estate owned by the above estate, including the parcel of property which is the subject of this application. The petition of the Public Administrator, verified March 23, 1956, seeking said order of sale, was served on counsel for the distributees of the decedent who died intestate. In accordance with the order directing the sale, the auctioneer published the prescribed notice of sale in designated newspapers and the sale was duly held on November 14, 1956. Petitioner was the successful bidder for parcel designated as No. 2 with a bid of $19,000. The map submitted on this application indicates that petitioner is the owner of other real estate in the vicinity of the auctioned real estate of the decedent. At the conclusion of the bidding petitioner, as such successful bidder, signed a memorandum containing the terms of sale and paid 10 percent of the gross bid. Of the eleven terms of sale set forth in said memorandum, items 3, 6, 7, 8 and 11 are pertinent to the within application by petitioner. These provide as follows:
'3. That said property is sold subject to any state of facts an accurate survey would disclose.
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'6. That the balance of the purchase money will be required to be paid to the Administrator within sixty (60) days after the date of sale.
'7. That the bidding will be kept open if the property is struck down and, in case any purchaser fails to comply with any of the conditions of sale, the property so struck down to him will again be put up for sale and such purchaser will be held liable for any deficiency there may be between the sum for which the property shall be struck down upon the sale and that for which it shall be struck down upon the resale, and also for any costs or expense of such resale.
'8. That the sale is made subject to the approval of the Surrogate of the County of Suffolk, under whose authorization it is being held. If the Surrogate shall not approve the sale, the money paid by the purchaser will be returned to him without interest, and neither party will be further liable to the other under the provisions of the terms of sale.
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Petitioner apparently failed to comply with the above item 11 of the conditions of sale and did not deliver any objections to title on or before December 14, 1956. The auctioneer's sale was confirmed by order of the court dated December 3, 1956.
Attached to the memorandum of sale was a full legal description of parcel 2, together with a survey of the affected land. The concluding paragraphs of the legal description state:
'Said boundaries including land under the water of Artist Lake and describing the fullest extent of the possible interest of Christian Krabbe.
'Said parcel comprising approximately 10.076 acres.'
The survey indicates the area of the property to be sold as 10.076 acres. One side of the survey also contains the following legend, explanatory of the boundary lines showing the extent of land under the lake:
'Possible extent of the interest or rights of the Estate of Christian Krabbe.'
The southerly, easterly and westerly lines of these premises lie, as indicated by this survey, in the bed of Artist Lake and indicate that approximately 7 1/2 of the possible 10.076 acreage offered for sale were under water.
In his petition for relief, petitioner summarizes the bases of his grievances by the following allegations:--Sometime after the sale petitioner ordered a title policy covering the auctioned premises but the title company refused to insure any land under the water of the lake or to insure the exact location of the boundaries of the auctioned premises lying in the bed of the lake. He also ascertained that the surveyor who prepared the survey which was attached to the copy of the memorandum of sale would not guarantee the survey of this parcel as to boundaries. Petitioner also then allegedly discovered that an adjacent property owner claimed title to at least a substantial portion of the land under water included in the 10.076 acres and had obtained title insurance thereto. Petitioner also claims that slightly more than two and one-half acres of the approximately 10 acres sold comprise land not under water and that, as to this upland acreage, the Department of Public Works of the State of New York might condemn a substantial portion of such property in connection with proposed road widening.
The foregoing allegations, however, are set forth in petitioner's petition of May 23, 1957 in general language with no precise dates alleged as to the time of various alleged facts and, where pertinent, the actual dates when petitioner first acquired knowledge of facts he now complains of. Notice of petitioner's application was given only to the Public Administrator.
The court has the power under Sections 20, subd. 6, 215 and 240 of the Surrogate's Court Act to vacate, upon a proper showing and upon proper notice to interested parties, a prior order confirming a judicial sale. As a court of equity, this court has the general equitable power to relieve a successful bidder from his bid, if after balancing the equities involved and upon a consideration of all the relevant facts, it is persuaded that it would be inequitable to direct the successful bidder to specifically perform and complete his bid or to forfeit his deposit, although such facts might be insufficient to avoid an ordinary commercial sale of property. 15 Carmody-Wait 439.
In Lane v. Chantilly Corp., 251 N.Y. 435, at page 438, 167 N.E. 578, at page 579, 68 A.L.R. 653, our Court of Appeals indicated that the historic rule of caveat emptor '* * * does not apply in all strictness to a purchaser at a judicial sale.' There a purchaser at a judicial foreclosure sale of improved property located at 640 Broadway, New York City, had executed with a referee a contract dated April 20, 1928, whereunder the purchaser agreed to accept title to the auctioned premises 'subject to any state of facts' that a survey might show. Immediately after the sale the...
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Mandelino v. Levy
... ... , have failed to establish that they were themselves free of inequitable conduct and that they seek the relief with clean hands (In re Krabbe's Estate, 7 Misc.2d 823, 165 N.Y.S.2d 541). They knew or had reason to know of the infirmities in the proposed sale and such knowledge must preclude the ... ...