Shirk v. Soper

• Decision Date: 06 December 1923
• Parties: SHIRK v. SOPER ET AL.
• Court: Maryland Court of Appeals

124 A. 911

144 Md. 269

SHIRK v. SOPER ET AL.

Court of Appeals of Maryland

December 6, 1923

Appeals from Circuit Court of Baltimore City; Duffy, Judge.

Action by Henry Shirk, individually and as administrator, against Morris A. Soper and others, trustees and others, to set aside a sale of trust estate. From an order ratifying sale and an order fixing appeal bond, plaintiff separately appeals. Order ratifying sale reversed and remanded; appeal from order fixing appeal bond dismissed.

Argued before BOYD, C.J., and BRISCOE, PATTISON, URNER, STOCKBRIDGE ADKINS, and OFFUTT, JJ.

Richard B. Tippett, of Baltimore (Henry Shirk, James W. Bowers, and Richard B. Tippett & Sons, all of Baltimore, on the brief) for appellant.

Clarence K. Bowie, of Baltimore (Bowie & Clark, of Baltimore, on the brief), for trustees.

Chester F. Morrow, of Baltimore (Niles, Wolff, Barton & Morrow, of Baltimore, on the brief), for purchaser.

OFFUTT J.

Henry Shirk, then residing in Baltimore city, died on or about June 18, 1891, leaving a last will and testament which in due course was probated in the orphans' court of Baltimore city. Under that will the residuum of his estate was devised and bequeathed to his daughter and his grandsons in the following proportions: To Susan Hiss, his daughter, one undivided one-half interest, to his two grandsons, Isaac Shirk and Henry Shirk, the other undivided one-half interest.

At the time of his death he was seized and possessed of a tract of land containing a little less than eight acres, which was bounded in part by the right of way of the Hampden & Lake Roland Railroad Company and Prospect avenue, and touched at one point Huntington avenue, and which was included in the residuum of the estate. It was contiguous to the right of way and tracks of the Maryland and Pennsylvania Railroad, which appears to separate it from the Falls Road, and to the right of way and tracks of the Baltimore & Ohio Railroad, and for many years a part of it has been operated as a quarry. It is said to be underlaid to the depth of 200 or more feet with a deposit of gneiss, a stone easily worked, durable, and suitable for the construction of all kinds of buildings, and the whole tract is peculiarly adapted for development as a quarry property.

On April 4, 1893, the owner of this tract sold about six-tenths of an acre of it for $14,000 to John G. Schwind, who for some years operated it as a quarry.

On June 27, 1899, Susan P. Hiss and P. Hanson Hiss, her husband, filed in the circuit court of Baltimore city a bill of complaint against Henry and Isaac Shirk, for the purpose of having the property sold, on the ground that it was not partible in kind without loss to the owners thereof. The pleadings were perfected, testimony taken and filed, the case submitted and the court, on May 24, 1900, passed a decree for the sale of the property, and appointed W. Starr Gephart and William A. Fisher trustees to make the sale. The trustees were authorized to sell at public sale, or, at private sale, "upon due proof and approval by the court, upon such terms as the court shall approve."

Nothing further was done until April 18, 1904, when the Security Storage & Trust Company, which had succeeded Mr. Fisher as one of the trustees, filed a report and petition showing the proposed sale of two and a quarter acres of the property to John G. Schwind at $10,000 an acre. W. Starr Gephart, the other trustee, did not join in the report, because he did not believe the consideration adequate; but he did file an answer to the report and petition filed by the Security Storage & Trust Company, in which he protested against the proposed sale on that ground, and also because the sale of the property would lessen the value of the unsold remainder of the whole tract. Testimony was taken in connection with the issues thus made and, on May 29, 1905, the court passed an order dismissing the petition.

On December 8, 1909, both the trust company and Gephart joined in reporting a sale of 1.089 acres of the same property to John G. Schwind at $15,000 an acre, and on January 26, 1910, that sale was finally ratified and confirmed.

On January 7, 1922, Hon. Morris A. Soper, who had succeeded W. Starr Gephart as trustee of the estate, and the Security Storage & Trust Company, the other trustee, reported to the court a sale to the Falls Road Quarry, Incorporated, of the stone underlying a part (340X220 feet) of the property at 20 cents a ton for all stone quarried. The agreement of sale referred to in the report provided that the vendee should, accounting from the 1st day of November, 1921, quarry during each year not less than 15,000 tons of stone. No cause to the contrary having been shown, that sale was also ratified and confirmed, on February 9, 1922.

On December 16, 1922, the trustees reported a sale of 2.7 acres of the remaining property to the American Woodworking Corporation, for $13,500, and on January 17, 1923, Henry Shirk, in his own right and as administrator and heir at law of Isaac Shirk, excepted to the ratification of that sale on the ground that the selling price was inadequate.

Those exceptions were in ordinary course set down for a hearing, and testimony in connection with them taken in open court. At the conclusion of the testimony, and after counsel for the parties had been heard, the court finally ratified that sale, and it is from that order that the first appeal shown by the record before us was taken. It was taken on March 28, 1923, and on June 26, 1923, Henry Shirk, the appellant, filed a petition in which, among other things, he charged that on March 29th, the day following his appeal, the trustees had conveyed the property described in the report of sale to the American Woodworking Corporation. He further averred that he was a man of limited means, and unable to supply a bond in a large amount, but that he could give an appeal bond to stay the execution of the decree in an amount sufficient to cover any costs which were likely to accrue, which under the circumstances of the case he said was all that was requisite. Upon that petition the court passed the following order:

"On the aforegoing petition and affidavit, it is hereby certified that the circuit court of Baltimore city is willing to fix the amount of the appeal bond in the aforegoing case at one thousand dollars ($1,000), and to instruct the clerk to accept a proper bond in said amount conditioned to prosecute said appeal with effect; but said circuit court of Baltimore city is willing only to fix the amount of said bond under condition that pursuant to article 5, § 29, of the Code of Public General Laws of Maryland, the decree or order appealed from in this case shall not be stayed by such appeal; and it is further certified that this court has communicated said condition above set forth to the appellant herein, and he is unwilling to have the amount of the bond so fixed under the condition above set forth; wherefore, this court declines to fix the amount of said bond.

Done this 26th day of June, 1923."

From that order the second appeal was taken.

The only question presented by the first appeal is whether the sale made by the trustees to the American Woodworking Corporation should have been ratified. In dealing with that question we are not precisely in the position we would occupy had the decree in this case been in the usual form, authorizing the trustees to sell at public or private sale and requiring them to report their sale to the court after it had been made, for in this case the trustees, by the plain and clear language of the decree were not authorized to make a private sale except upon "due proof and approval by the court, upon such terms as the court shall approve." The record in this case indicates that the sale under consideration was a private sale, made without the knowledge or approval of the court, and that at the time the contract was made no proof concerning it had been submitted to the court which was later called upon to ratify it. The power to sell at private sale, conferred by the decree upon the trustees, was not an absolute power, but a conditional power, and as the right of the trustees to sell at all was necessarily derived from the decree, they had no power to sell until they had complied with the conditions prescribed by it as essential to the exercise of that power. The question before the lower court therefore was, not whether it should set aside a sale that had actually been made, but whether it should approve a proposed sale. And the rule laid down in such cases as Warfield v. Ross, 38 Md. 85, cited by the appellee, that mere inadequacy of price standing alone "is insufficient to authorize an interference with a sale unless it is so inordinate as to indicate some mistake or unfairness for which the purchaser is responsible, or misconduct or fraud in the trustee to whom the management of the sale had been committed," is not applicable, for the reason that in this case no sale had been made, since by the terms of the decree no sale could have been made without the approval of the court after "due proof" had been submitted to it that the sale proposed was fair and for an adequate consideration. So that in dealing with the propriety of the sale proposed by the trustees upon the terms set out in their agreement with the American Woodworking Corporation, the court was not affected by any of those presumptions in favor of it, which are enumerated in the case of Wicks v. Westcoot, 59 Md. 276, where it is said:

"Ordinarily, the presumptions are that the trustee did his whole duty, and that a sale made at public auction, after due notice, has brought the best price; but when facts are found to exist, calculated to prejudice the sale, the presumption is against

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