Maynard v. Maynard

• Decision Date: 12 January 1943
• Citation: Maynard v. Maynard, 292 Ky. 638, 167 S.W.2d 853 (Ky. Ct. App. 1943)
• Parties: MAYNARD v. MAYNARD et al.
• Court: Kentucky Court of Appeals

167 S.W.2d 853

292 Ky. 638

MAYNARD v. MAYNARD et al.

Court of Appeals of Kentucky

January 12, 1943

Appeal from Circuit Court, Pike County; R. Monroe Fields, Judge.

Consolidated suits by Talmage Maynard against J. Ned Maynard and others to set aside a sale of realty under a default judgment in mortgage foreclosure suit and to restrain execution of a writ of possession.From a judgment of dismissal, plaintiff appeals.

Reversed with directions.

Willis Staton and E. J. Picklesimer, both of Pikeville, for appellant.

A. F Childers and J. J. Moore, both of Pikeville, for appellees.

MORRIS Commissioner.

Appellant prior to December, 1939, executed his note to the Pikeville National Bank and Trust Company, and to secure payment a mortgage on his home tract comprising about 300 acres.He was in default as to principal and interest when the bank sought to enforce its lien, the debt and interest at the time being around $1,380, and in November, 1939, default judgment was entered with directions to sell.On December 4th the land was sold under decree, and on December 20th appellant filed his petition in equity seeking to have the sale set aside because of inadequacy of sale price, and irregularities in the appraisement and sale, which appellant charges constituted fraud against his rights.

A second petition sought to enjoin the sheriff from executing writ of possession.Partiesdefendant were the bank, J. M Maynard and the sheriff, and basic allegations of the petitions are similar, and substantially as follows: The master commissioner appointed two deputy sheriffs to and they did appraise the tract of land at the value of $2,000; it is charged that being interested in preventing redemption they fixed the value at low figures so that the tract would sell at more than two-thirds of the fixed value; that the land was appraised on the same day as the judgment was rendered and the appraisers did not view or know its boundaries, improvements or the character of the land.

It was asserted that the land with improvements was worth in excess of $5,000.Appellant says that on the day of sale he was the only bidder, his bid being the amount of the debt, interest and court costs; that the commissioner accepted his bid and told him that he would have time to execute the necessary purchase bonds, and that he undertook to comply, and was within a reasonable time able and willing to pay the amount bid.He was later advised that the commissioners had reported the sale as having been made to the creditor bank upon a similar bid.He had been advised by the bank that it did not desire to purchase the land, but only wanted its money; that he had a promise from his brotherJ. N. Maynard that he would become surety on the bond, but that after sale the brother failed to carry out his agreement.Court was about to adjourn, according to his belief, on Saturday the day fixed by statute for the ending of the term, and relying on the alleged statement of officers of the bank, he came in ready to make payment, when officers of the bank informed him that another party had been promised the land if he failed to make payment; that they delayed letting him know otherwise until late in the afternoon, then deed had been made to the bank, and in turn to the brother, who had paid the debt and costs.

The petition charged that when his bid was accepted the commissioner said, "Now if you fail to give bond by two o'clock this property will be sold again," which was misleading to him in view of other statements made by the officers of the bank, and that the bank was not a bona fide purchaser.Maynard said that he was uneducated and did not know his legal rights, that had he so known he would have employed counsel to look after his interests and filed exceptions, but relied on the representations of the creditor and the commissioner, and that their actions, in connections with his brother's part in the transaction, resulted in his being deprived of his right to purchase or redemption.

The bank and J. N. Maynard filed separate answers, in the main denying the allegations of both petitions; the bank, which is apparently only interested to the extent of securing payment of its debt, plead affirmatively that the judgment in its favor was rendered on November 15, 1939; that the property was sold by the commissioner on December 4th; the sale was approved on December 8th, on which day the commissioner made, and the court approved the deed to it, but it was not lodged for record until the 12th; that at all times during the proceedings officers of the bank had told plaintiff, after it bid the property, it would willingly executed a deed to him if he could make final arrangements to pay the debt, but that in the event J. N. Maynard made arrangements to pay it it would carry out the obligation to him.

The brother's pleading undertook to plead the facts insofar as he was concerned, and both defendants relying on the plea of estoppel, and that the brother was a bona fide purchaser at fair value, and since plaintiff stood by and allowed the report to be confirmed and deed made without exception, he is now estopped to question the sale on the grounds alleged.Allegations of undenied pleadings were controverted of record.

The record shows that on March 12, 1940, the appellant tendered the sum of $1,388.33 in full settlement of what he conceived to be the amount of the bank's judgment against him, same to be paid to the bank or to J. N. Maynard in the event the two deeds be cancelled.This tender was withdrawn after the court had rendered judgment.At the May term 1941, the cases having been consolidated were submitted on pleadings and proof, and the chancellor denied plaintiff's relief, and dismissed the petitions.

On behalf of appellant it is insisted that the disparity between the appraised value and the real value of the land was so great as to create a presumption of fraud, relying upon the case of Morton v. Wade et al.,175 Ky. 564, 194 S.W. 802, in which is laid down the general rule that while inadequacy of price, standing alone, is not a sufficient ground to void sale, unless the inadequacy is so great as in itself raises the presumption of fraud or to shock the conscience of the court; but when in connection with inadequacy of price there are other circumstances having a tendency to cause such inadequacy or any apparent unfairness or impropriety, the sale may be set aside although such additional circumstances are slight, and if unaccompanied by inadequacy would not furnish sufficient grounds for voiding the sale.This rule has been referred to both in former and recent cases, the latter being Smith v. Halowell,201 Ky. 271, 272, 256 S.W. 408, andKentucky Joint Land Bank v. Fitzpatrick,237 Ky. 624, 36 S.W.2d 25.

It is here charged that there were such irregularities in the sale as to void it, even in the absence of the element of inadequacy, the general charge being that by the actions of the brother, the creditor and the court officers, he was disarmed, and did not have opportunity to protect his legal rights.He claimed, and there is no proof otherwise, that he did not know the property had been appraised at $2,000 until announcement was so made by the commissioner, and under all the circumstances he was under the belief that he would be allowed to bid the amount of the judgment debt and redeem his property.

When the sale was first made he was the sole bidder.He was surprised at the statement of the master commissioner, who made the sale at one o'clock, that unless he executed purchase bond by two o'clock he would resell, as he was by his brother's refusal to become surety on the bond.This the brother in a way indirectly denies, saying that "just a few minutes before the sale he said something about me going on his bond; the best I remember I told him that I didn't know whether they would take me on a bond like that or not," though he says, after the sale he was not approached by plaintiff.Appellant says that "he talked like he did not want to go on the bond."

There are undisputed record facts.The property was advertised to be sold on December 4, 1940.We gather from the record that appraisement and report of sale was made on the same day and confirmed on the 8th day of December, when deed was executed to the bank by the commissioner and approved by the court, and on the same day the bank conveyed the land to J. N. Maynard apparently for amount of judgment debt.

We take up first the proof as to the value of the land, as was developed by testimony of appellant.He testified that there were 300 acres; 20 were good bottom land, reasonably worth $100 per acre.He described the buildings and his orchard and their values.While the gas rights had been sold, the land was underlaid with coal, and that such land was reasonably worth $10 per acre.Without going into details his summation would place the value of his land at more than $10,000.He introduced eight or more witnesses who were familiar with the land; their estimates of the fair value were in all instances above $6,000, all agreeing that the bottom land alone was worth the appraised value.

Appellant had listed his land at $4,000, and his brother, acting as appraiser when appellant was seeking the loan had appraised the same land at $3,000, but says due to removal of timber and lack of care it...