Scott v. Newell

• Decision Date: 31 May 1928
• Docket Number: 12455.
• Citation: 144 S.E. 82,146 S.C. 385
• Parties: SCOTT v. NEWELL et al.
• Court: South Carolina Supreme Court

144 S.E. 82

146 S.C. 385

SCOTT v. NEWELL et al.

No. 12455.

Supreme Court of South Carolina

May 31, 1928

Appeal from Common Pleas Circuit Court of Williamsburg County; John S. Wilson, Judge.

Action by Kemper Scott against J. P. Newell and others. Decree for plaintiff, and defendants appeal. Reversed and complaint dismissed.

Cothran and Carter, JJ., dissenting.

J. D O'Bryan, of Kingstree, and N. N. Newell, of Moncks Corner, for appellants.

James W. Johnson, of Marion, and Hinds & Meadors, of Kingstree, for respondent.

THURMOND A. A. J.

This action was instituted October 16, 1924, by Kemper Scott against J. P., N. N., H. F., A. B., & J. L. Newell, by the service of summons and complaint, and affects the title to thirty acres of land in Williamsburg county.

October 31, 1921, E. A. Simmons executed a mortgage to the Federal Land Bank of Columbia, on two tracts of land in Williamsburg county, one tract containing 39 1/2 acres, and the other containing 30 acres; subsequently, November 12, 1921, E. A Simmons and D. H. Oliver executed and delivered to Kemper Scott four certain promissory notes, each in the sum of $1,280, aggregating $5,120, and as security therefor executed a mortgage on the 30-acre tract aforesaid; thereafter Kemper Scott transferred said notes and mortgage to Marion National Bank, which in April 1923, foreclosed the mortgage; at the foreclosure sale Kemper Scott purchased the land and received a fee simple deed from the clerk of court thereto, May 21, 1923; this deed was duly recorded in the office of the clerk of court for Williamsburg county, two days later. To the said foreclosure proceeding the Federal Land Bank was not made a party, and the 30-acre tract of land was sold subject to its prior lien. After the execution of the notes and mortgage by E. A. Simmons and D. H. Oliver, aforesaid, to Kemper Scott, E. A. Simmons was adjudged a bankrupt.

October 22, 1923, Kemper Scott entered into a contract to sell said tract of land to J. P. Newell for $3,000, and gave J. L., or J. P., Newell bond for title, under which J. L., or J. P., Newell went into possession of said 30 acres of land, the bond for title giving the name of the vendee as J. L. Newell in one place and J. P. Newell in another; and the note for $2,500, for the unpaid purchase money, is signed by J. L. Newell, a son of J. P. Newell; and $500, the cash portion of the purchase price, was paid to Kemper Scott. The bond for title recognized that Kemper Scott's title was not free of incumbrances and provided that the balance of $2,500, due Kemper Scott for said 30 acres of land, should be paid three years after the title to said parcel of land was straightened out (meaning cleared of the Federal Land Bank's mortgage), certain interest to be paid in the meantime, etc.

The 30-acre tract was the western part of a larger tract containing in the aggregate 69 1/2 acres, which two tracts were separated by the track of the Seaboard Air Line Railway Company.

In April, 1924, the Federal Land Bank of Columbia instituted suit through Lee & Shuler, its attorneys, at Kingstree, S. C., for the foreclosure of the mortgage executed to it by E. A. Simmons of the two said tracts of land, and as Simmons was in bankruptcy his trustee was made a party defendant; also Kemper Scott, who had previously purchased the 30-acre tract of land, at the foreclosure sale commenced and prosecuted by the Marion National Bank, was made a party. J. L. Newell was also made a party defendant to said action commenced by the Federal Land Bank, and filed an answer by his attorney, N. N. Newell, setting up his contract of purchase of the 30-acre tract of land from Kemper Scott, and praying that his interest be protected.

The two said tracts of land under the decree of foreclosure in the case of the Federal Land Bank of Columbia against Kemper Scott and others were sold at Kingstree, on the first Monday in October, 1924, and both tracts were bid off by N. N. Newell, attorney, to wit; the 39 1/2-acre tract of land for $5,300, and the 30-acre tract of land for $500.

The decree of foreclosure required the successful bidder to deposit immediately with the clerk of court $500, which would be forfeited upon the bidder's failure to comply with his bid. After the sale, N. N. Newell deposited with the clerk of court J. P. Newell's check for $500. The balance of the bid was to be paid by the 10th of October. N. N. Newell had agreed to let Scott have his bid if he, Scott, complied with the terms thereof by the 10th of October. Scott failed to comply on said day. The attorneys for the land bank notified N. N. Newell accordingly, and the land was readvertised for sale.

After Kemper Scott had failed to comply with the terms of the bid N. N. Newell on October 15, 1924, transferred his bid to the 39 1/2-acre tract of land to Mrs. E. A. Simmons for $3,500 and a note to E. A. Simmons for $500, and transferred his bid to the 30-acre tract of land to A. B. and H. F. Newell, for $1,800 in cash and discounted note of E. A. Simmons for $500; the amounts of the bids were paid at once to the clerk of court in compliance with the terms of the sale.

Mr. Kemper Scott appeared on October 15, 1924, at Kingstree, S. C., about four o'clock p. m., with a certified check for $5,300, the same day N. N. Newell transferred his bids, but at the time Scott appeared with a check, the transfers had been made by N. N. Newell, Atty., the amounts of the bids paid, and deeds made by the clerk of court to the respective parties. Mr. Kemper Scott then instituted this action, alleging that N. N. Newell acted as his agent in his bids on the two parcels of land, and perpetrated a fraud on him by transferring the bids to other parties, and that they participated in the fraud.

The complaint demands:

"1. That the said deed to the 30-acre tract be set aside and annulled.

2. That the defendant N. N. Newell be ordered to transfer his bid to plaintiff, and the clerk of court be ordered to make deed for said 30-acre tract to plaintiff.

3. For the costs and expenses of this action.

4. For such other and further relief as plaintiff may be entitled to and as to justice and equity may appertain."

Answer of J. P., N. N., and J. L. Newell:

The answer of J. P., N. N., and J. L. Newell denies certain material allegations of the complaint and sets up that after the sale of said property, the said defendants met the plaintiff in the office of Lee & Shuler, and N. N. Newell agreed with plaintiff that if he would put up the amount of the bid by Friday, October 10th, he would transfer his bid to him, it being agreed that the plaintiff would give the defendant J. L. Newell, a bond for title to the said 30-acre tract of land, at the price of $2,000, with the distinct understanding that it would be necessary that the sale be complied with by Friday noon, October 10th. The answer further states that N. N. Newell was notified on October 10th, through Messrs. Lee & Shuler, attorneys for the Federal Land Bank, that the plaintiff had not complied with said agreement and the plaintiff failed to comply, so on October 15th, following, N. N. Newell with the consent of his client transferred to Mrs. E. A. Simmons his bid to the 39 1/2-acre tract of land for $3,500 and $500, note of E. A. Simmons; and

transferred his bid to the 30-acre tract of land to A. B., and H. F., Newell, for $1,800, in cash, and discounted a note of E. A. Simmons for $500, and immediately thereupon the full amount of said bid was paid to the clerk of court who executed deeds to the said parties.

Answer of A. B. and H. F. Newell:

"The defendants A. B. Newell and H. F. Newell, answering the amended complaint of plaintiff herein, allege: I. That they deny paragraphs 'XIV' and 'XV' of the complaint herein:

II. That they have not sufficient information to form a belief as to the truth of the allegations contained in the remaining paragraphs of said complaint, and therefore deny the same.

Further answering said complaint, and as a further defense thereto, these defendants allege:

1. That subsequent to the date of the sale of the Simmons property, mentioned in the complaint herein, these defendants, acting in good faith, and for valuable consideration, purchased from N. N. Newell, attorney, his bid for the 30-acre tract of land described in the complaint herein, and thereafter complied with the terms of said bid by paying the amount thereof over to the clerk of court, who thereupon executed and delivered to them his deed for said 30-acre tract of land; and that they are now the lawful owners thereof, and have no knowledge or information as to the matters and things alleged in the complaint regarding the transactions alleged to have been had between the other parties to this proceeding and the plaintiff herein."

An order of reference was made by his honor, John S. Wilson, August 29, 1925, directing Henry E. Davis, Esq., as special referee, to take the testimony in this cause and report his conclusions, both of fact and law, to the court. Pursuant to said order of reference the referee took all the testimony which the parties to the action saw fit to offer, and decided the case in favor of the plaintiff.

The defendants served twenty exceptions to the master's report; but the circuit judge who heard the case overruled all the exceptions and concurred in the findings of the special referee in a decree dated October 20, 1926, and confirmed the referee's report; then on November 2, 1926, his honor made a supplemental decree, correcting an error in the original decree as to the time for the sale of the 30-acre tract of land

The defendants appealed from the decree confirming the referee's report to this court, and served 23 exceptions. These exceptions impute error to his...