Patterson v. Fidelity & Deposit Co.

• Decision Date: 12 September 1935
• Docket Number: 10583.
• Citation: 181 S.E. 776,181 Ga. 61
• Parties: PATTERSON v. FIDELITY & DEPOSIT CO. et al.
• Court: Georgia Supreme Court

181 S.E. 776

181 Ga. 61

PATTERSON v. FIDELITY & DEPOSIT CO. et al.

No. 10583.

Supreme Court of Georgia

September 12, 1935

Syllabus by the Court.

1. The plaintiff failing to allege in her petition any duty imposed by law on the administrators to sell the real property at the expiration of one year from the date of their qualification and failing to disclose that any of the heirs or distributees demanded of the administrators that the property be sold at the expiration of one year of their appointment as administrators or that they had applied to the court of ordinary for the sale, the fact that the real property in question was not sold by the administrators until more than three years after the death of the intestate would not be a breach of official duty on the part of the administrators which would impose a liability on the surety on their bond.

2. Where a sale of realty conducted by an administrator is illegal and void, title to the property sold does not pass and the heirs and distributees may assert their title to the property so sold, and there is no such loss to the heirs or distributees as would amount to a breach of the bond of the administrator and render the surety thereon liable.

Error from Superior Court, Fulton County; John D. Humphries, Judge.

Suit by Mrs. Lula B. Patterson against John D. Patterson and Mrs Birdie Garner, as administrators of the estate of Ella J Patterson, deceased, and another, to which the Fidelity & Deposit Company of Maryland was made a party defendant. To review a judgment dismissing the case as to the last-named defendant on demurrer to the petition, plaintiff brings error.

Affirmed.

RUSSELL, C.J., and BELL, J., dissenting.

Jones, Fuller & Clapp, of Atlanta, for plaintiff in error.

Little, Powell, Reid & Goldstein, James H. Therrell, W. P. Bloodworth, and Heyman & Heyman, all of Atlanta, for defendants in error.

BECK Presiding Justice.

Mrs. Lula B. Patterson filed suit against John D. Patterson and Mrs. Birdie Garner, as administrators of the estate of Ella J. Patterson, deceased, and J. R. Garner, asking for the removal of the administrators, for an accounting, and for injunction and other relief. Subsequently the Fidelity & Deposit Company of Maryland, hereinafter called the Fidelity Company, surety on the bond of the administrators, was made a party defendant. This company filed a demurrer to the petition. The demurrer was sustained, and the case was dismissed as to the surety. The plaintiff excepted.

The following allegations were made in the petition: The plaintiff purchased from her husband, John D. Patterson, Jr., his undivided one-fifth interest in the estate of his mother, Ella J. Patterson, deceased. John D. Patterson and Mrs. Birdie P. Garner were the administrators of the estate.

J. R. Garner is the husband of Mrs. Birdie P. Garner, one of the administrators. The chief asset of the estate was a house and lot on Peachtree street, Atlanta, Ga., appraised at $25,000. Mrs. Ella J. Patterson died on December 16, 1928. The real estate was not offered for sale until the spring of 1932. It was subject to a loan of $5,500. When Mrs. Patterson died in 1928, there was cash on hand amounting to $3,431.99. In 1932, when the real estate was offered for sale, all of the cash had been spent, but none of it had been applied on payment of the mortgage on the real estate. The property was advertised for sale three times in 1932: During the month of March, for sale on the first Tuesday in April; the second time, during the month of April, for sale on the first Tuesday in May; and the third time, during the month of May, for sale on the first Tuesday in June. For some reason unknown to petitioner, no sale was had on the first Tuesday in April, 1932. On the first Tuesday in May, 1932, petitioner's husband, John D. Patterson, Jr., was present in front of the courthouse door at the hour for legal sale, and had with him a responsible party ready, willing, and able to bid on the property the sum of $20,500, and to pay $7,000 in cash and give other property of the value of $8,000. Without reference to the property which was offered in addition to the cash, the prospective purchaser on the ground, ready to bid on the property, was ready to pay $7,000 cash and assume the loan thereon of $5,500. John D. Patterson, one of the administrators, exercising control of the sale, was notified in person by the husband of petitioner that the prospective bidder was on hand ready to bid. The administrator refused to come to the courthouse and cry off the property, and it was not offered for sale in May. On the first Tuesday in June, 1932, the husband of petitioner was present in front of the courthouse, awaiting the sale of the property. He stepped into the ordinary's office for a moment to make inquiry about the case; when he left, the administrator had not begun to read the advertisement; but shortly thereafter, when he came out of the ordinary's office, he was informed by J. R. Garner, the husband of Birdie P. Garner, one of the administrators, that J. R. Garner had bought the property for $100. This price for the property was grossly inadequate. The sale was fraudulent by reason of the way it was conducted, and the administrators failed and refused to sell the property at a time when they could have realized not less than $7,000 in cash over and above the loan thereon, and they deliberately delayed the sale for the purpose of conducting it later, under circumstances where there would be no competitive bidding, so as to enable the husband of one of the administrators to buy in the property for a nominal sum. Also gross mismanagement and incompetency of the administrators were charged. The prayers were for an order declaring the sale illegal and setting it aside, for removal of the administrators, and for the appointment of a receiver; also for an accounting and judgment, and for an order enjoining J. R. Garner from undertaking to dispose of the property which he is alleged to have bought.

Before the hearing of the demurrer to the petition, the $5,500 mortgage on the property in question was foreclosed under an order of court, and the net proceeds of the foreclosure sale, after paying off the principal and interest of the loan and all costs, was only $791.72.

1. Under the allegations in the petition no cause of action is shown against the Fidelity & Deposit Company. One of the grounds of complaint is that the administrators did not sell the real estate "promptly" or "at...