(District Court, D. Colorado. November 28,1887.)
1 JUDIGIAL S4LES-OBJEC'flONS TO MaSTER'S SALE-LAPSE OF TIME.
Objections that a master's sale was not published the length of time required by IflW by but one day, and that, through his incompetency, part of the property was sold for less than it could hflve been sold for, mlide two years after the sale, canpot beeustained, as th41Y should have been made nromptly. A master's deed, for property sold by him after he filed his report, is void.
SAHE-DEED:-EXECUTION BY. MAIl'J.'ER-AFTER FILING REPORT,
Motion to Set Aside Master's Sal,e and Deed. Duncan McBride filed a bill in chancery, OC,tQber 24, 1884, against George R. ,Gwynn, James Moynahan, and the Great West Mining Company ,to foreclose a trust deed securing the paYIDent of $3,000, loaned by McBride to the company. The trustee named in ,the deed was D. C. Cra"W'ford, who refused to make sale; hence this, application to the court. which the trust Gwynn and Moypahan claimed to own and were brought in as defendants. Leave was,granted deed was plaintift'Aprij. 6; 1885, to file an /!mended hill,makiIlg JamesM. Stric1\ler, trustee of t4e company, and Alfred H. all<l Randall W. Wiland on son, granteesa11d assignees of <;}wynn and .the same Wilsons and Striclder their answers admitting that the trust deed from the company to McBride was a prior lien, and conse.nted for complainallt. ,On the.second day, (rule.:day,) the default ohll, defendants was entered by the clerk; a,nd a decree fO,r complainallt'wll,s entered June 8,1885, finding.thecompaqYindebted'to McBride, $1,916, the payment of which was secU,red. by the trust deeQ; and special master ,to make a sale of property under the deed of trust. . Complainant Wed a petition, Septemissue a to,hinl, ber 7, 1885,asking that the w:hichWIlS, denje<:I on the same day, .and the master was ordered to read.v¢rtise and resell, The master filed. his report January 14, 1886, and the company. filed exceptions .to the report ofsale October 14, 1887. The company fiXed a motion October 28, 1887,)0 set asjdElthe master's for the f9110wing reasons: (1) Th(l report was not confirmed; (2) tpe master had no authority to eXeCl:lte the dee<l,llDtil the was con,.firmed; and (3). the report of sale pending ou'exceptions' to its tirmation..,' . H. B'.Johnson, for the motion. Hugh ButUrr' opposing.
HALLETT, J. I The circumstances case Ij,resowewhltt nary. The sale was made something over two years ago; and the property, which was regarded by the parties as of the most value at the time of the sale, and perhaps ever since that time, was redeemed from the sale, so that at presert there is no questi9n affecting the defendants' title to
that propertyariiling under this sale. The Adrian lode, which was un· doubtedly regarded as the most valuable of all the property involved in the suit, and which property was regarded as the only property of any value, was afterwards redeemed from the sale made under this foreclos· ure proceeding by the Wilsons; and whatever the effect of that redemption may be, it is clear that no one, the Wilsons or anybody else, are claiming title to that lode by this sale. The only property affected by the sale are the adjoining claims, which at that time were sold to, or were bid ()ff by, the for very small sums of money. The irregularities of the Sale were such as would undoubtedly have been accepted as sufficient to cause the sale to be set aside, lI.nd a. new one ordered, upon a motion made immediately after the sale, but that was not done, and no objection to the sale appears to have been brought forward until two years after it was made. Under such circumstances, unless the matters complained of are such as make the sale void, or of such extraordinary character as. to show that it was entirely unfair and unreasonable, they ought not to be allowed or entertained. As to the objection that the notice was not sufficient, it is somewhat doubtful whether that objection is well taken, although it seemed to be conceded by counsel for respondents in the argument. But excluding the day on whiehthe notice.was given, the twelfth of September, and including the day of the sale, the tenth· of October. there were 28 days embraced in the time for which the notice was published. If, however, we say that was not sufficient, thetime was very little short of it; it was only one day shorti' and upon that question the rule is, I think, that an irregularity of that kind, unless it be promptly taken advantage of, will not be sufficient cause. to set aside the sale. In this respect the proceedings upon a sale of this killd are analogous to sales under execution at law. In the case of HendertKYn v. Herrad. 23 Miss. 434, the court says: "Sales by a commissioner under decree of the chancery court should be rpgulated very much by the same rules which apply to execution sales at law by a sheriff. The objection in each instance is the same. namely, the execution of the jUdgment or decree of thecollrt; and the illtt'rests of suitors, as well as public policy,dernand that thesal,es shoull! be in each instance alike certain and obligatory, and that the title Which a purchaser obtains in either mode should possess a similar degree of validity and force." I think that is a correct proposition; and as to the defects in the notice of under executions at law,it is stated in this work, (Freem. Ex'ns, § 286:) "But a very decided preponderancE:' of the authorities maintains this proposition: that the statutes requiring. notice of the sale to be given lire directory merely; and that the failure to give such notice cannot avoid the sll.1e against any purchaser not himself in fault." That proposition, I think. is established by the authorities cited; and, if it be conceded that, the notice here was lacking in the requisite time required by the order and decree in one day, I think that the defendAut, after so long a time h!lSelapsed, is not at liberty to avail itself of it. The observatiollS are applicable to the price for which the property
sold,-that.is to say, those claims other than the Adrian, that sold for very small sums of money. It is very evident, from what took place in this case, as ·well as what we have learned of this property in other cases, that these.claims were mere adjuncts and appurtenances to the principal claim, which was the Adrian lode. It is said that the Adrian lode sold for $2,300 and for $2,500, and perhaps for some other sums near those sums, at a prior sale and at this sale; and that it is sufficient to show that this was the valuable property involved in the suit; and that the other claims lying adjacent were not, at that time, regarded as of any value at all, except in connection with the principal claim. Now, that insufficiency of price must be promptly objected to, and that application for a resale oftheproperty must be promptly made, is a proposition affirmed by these cases:: Bullardv. Gre'l, 10 Mich. 268; Leonard v. Taylor, 12 Mich. 398; Goodwin v. Burns, 21 Mich. 211. Ithink there are other cases to the same effect; and that it is a proposition which is well established that upon a sale of this kind parties objecting to the sale upon the ground of inadequacy, or upon the ground of such irregularities as are alleged to have taken place upon'this sale, must make their objections within a short time after the sale has been had, so that if a rasala O'f the premises is to be dered that it shall be done before any change ofposition has occurred on the part of any parties to the controversy, and before rights have been acquired in the property which may be prejudiced by any such order. It is certainly true that Burns was a very incompetent and inefficient sort of man for this business. How he could conceive it to be'his duty to accept so many bids from the Wilsons, and to return to them money after he had once received it, is beyond comprehension; and then to strike off the property in the way he did for a less sum than had been offered for it before,-'-all these things were very irregular, but they were items of which the principal defendant, the Great West Mining Company, and all other parties to this controversy, were bound to take notice within some reasonable time after the sale took place. That is enough as to these exceptions. I think the defendant is not at liberty to allege them at this time, but as to the deed which was made by Burns, as it is said, some time.within six months, that is as utterly void as anything that can be spoken of. It has no more forcf,) and validity than if it had peen , made by somebody passing on the street, who was never heard of in the case. Burns had no authority to make it under any order that had' ever been made in the case, and none arose by implication oflaw;and.from his conduct in the case, I should say he is a very improper person to have any such authority, if it could reside anywhere. I do not recognize him as having any authority whatever at any time since he filed' h,is re:. pdrt in the case; certainly he never would have any unless it con:' ferred upon him by some new order of the court. .That deed niust· he set aside, and the report must stand subject to any'other order that may be made in the case. That is, I think, all that is necessary to SIlY upon the Bubje9tat this time. . I regard this report as standing in the same sittlationas it: was when first filed. I do not forget that in another.suit in which the right"of the
IN RE ARMSTRONG.
plaintiff to pursue the remedy which he sought in this case was very seriously questioned, it was ascertained that his conduct had been very extraordinary; but that is not a matter of which notice can be taken in this proceeding, and upon such exceptions and motions as are pending bere in reference to this report.
in re ARMSTRONG.
(Oircuit Oourt, S. D. Ohio, W; D.)
BANKS AND BANKING-NoTES FOR COLLECTION-INSOLVENCY OF·
The Winters National Bank Bent to the Fidelity Bank a note of $2,000 for collection, and indorsed "Pay FidelityNational Bank. Cincinnati, 0., or order, for collection for account of the Winters National Bank, Dayton, Ohio. J. C, Reber, cashier." The Fidelity Bank forwarded it to the Drovers' & Mechanics' Bank, which received payment thereof at maturity. Before the Fidelity Bank received notice and remittance of the $2,000, it became insolvent, and went into the hands of a receiver, who took the $2,000, and credited the Winters Bank therewith. Held, that the Fidelity Bank did not own the note, and the Winters Bank was entitled to the full $2,000. as against the Fidelity Bank's receiver.
Application by Receiver for instructions. This is an application by David receiver of the Fidelity National Bank, for instructions as to his action in regard to $2,000 received in payment of a certain note. E. W. Kittredge and W. P. Burnet, Dist. Atty., for receiver. JACKSON, J. The petition of the receiver sets out the following state of facts, on which the instructions of the court are asked, viz.: On the eighteenth day of May, 1887, the Winters National Bank of Dayton, Ohio, being the holder and owner of a certain note for $2,000 made by L. H. Lee & Bro., of Baltimore, Maryland, dated March 17, 1887, payable three (3) months after date at the Third National Bank of Baltimore, to them'der of Whitely Fassler & Kelley, and by them indorsed to said Winters National BaQk, forwarded the same to the Fidelity National Bank of Cincinnati for collection and credit, placing on the note the following special indorsement: "Pay Fidelity National Bank, Cindnnati, 0., or older, for collection for account of the Winters Natimtal Bank, Dayton, Ohio. J.C. REBF:R, Cashier." The Fidelity National Bank forwarded the' note to the Drovers' & Mechanics' National Bank of Baltimore for collection, and on the twentieth day of June, 1887, the day of its maturity; it was paid by the makers, and the amount thereof was on the same day, credited on the books of the Drovers' & Mechanics' National Bank to the National Bank. On the morning of June 21, 1887, .before receiving any advice of the' payment ofs8idnote, and, before any credit was given on its books to the Winters National Bank for said note,' or for the amount collected thereon by its/correspondent, :