Case ID: nc_173/html/0088-01.html
Source: Caselaw Access Project
Author: {"author": "Hojeus, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

M. R. UPCHURCH et al. v. G. W. UPCHURCH et al.
    (Filed 7 March, 1917.)
    1. Judicial Sales — Confirmation—Court’s Discretion — Statutes.
    The highest bidder at a sale oí lands under decree of court is a preferred proposer, acquiring no independent rights in the property or suit until confirmation, which rests within the sound legal discretion of the court until he moves therefor, the statutory requirement that the sale be confirmed “if no exception thereto is filed within twenty days,” being for the convenience of the parties in not requiring them, as before the enactment of the law, to give notice, etc., of the motion whereon the court may act and conclude them. Revisal, Sec. 2513.
    
      2. Same — Advanced Bid — Amount.
    While it has been in accord with the practice in this State to refuse to confirm a judicial sale unless there has been an advanced bid from a responsible bidder, this is but to afford evidence as to the inadequacy of the price, which the court, in the exercise of its discretion to confirm or set aside the sale, may regard or disregard; and while a hid of 10 per cent will customarily be considered, so may, also, an advanced bid in a less sum, when the amount is large, a distinction also recognized by our statute, ch. 146, Laws 1915, as to sales under decree of foreclosure, etc., making 5 per cent sufficient when the bid is more than $500.
    3. Judicial Sales — Confirmation—Fraud and Mistake — Motion in Cause— Statutes.
    After confirmation by the court of a judicial sale of lands, the purchaser is regarded as the equitable owner, and the sale, as it affects his interest, can only be set aside for “mistake, fraud, or collusion,” established on petition regularly filed in the cause. Revisal, sec. 2513.
    Cause beard on appeal from judgment of clerk of Superior Court of Chatham, before Cox, J., presiding and bolding tEe courts 'of tbe Fourth Judicial District, February 7-10, 1917.
    Tbe judgment of tbe clerk was one refusing to confirm a sale of lands bad pursuant to a decree by bim duly entered, and tbe facts pertinent to tbe present appeal are very well epitomized in tbe judgment of Judge Cox, as follows: “It appearing to tbe court, and tbe court finding as a fact, that tbe sale of tbe lands and timber described in tbe complaint filed in tbe cause, made by tbe commissioners herein on 5 January, 1917, was in all respects regular; that there were numerous bidders at tbe sale and tbe bidding was spirited; that W. T. Hunt of W. T. Hunt & Brother was present and bidding; that W. L. Nevins and L. B. Flournoy, trading as Nevins & Flournoy, became tbe last and highest bidders at said sale for tbe land and timber at tbe price of $26,000; that said bid was a fair and reasonable price for said land and timber; that tbe commissioners made report of tbe sale1 without recommendation, on 6 January, 1917; that an advanced bid of $1,500 was filed by W. T. Hunt and S. L. Hunt, trading as W. T.'Hunt & Brother, with Hon. James L. Griffin, clerk of tbe Superior Court of Chatham County, on 27 January, 1917; that before tbe filing of tbe advanced bid no exception bad been made to tbe report of tbe commissioners and no confirmation of tbe sale bad been made by tbe court; that on 29 January, 1917, W. L. Nevins of Nevins & Flournoy appeared in person and witb counsel before said clerk of the Superior Court of Chatham County and moved the court for judgment confirming said sale to Nevins & Flournoy, and for an order requiring the commissioners to make and deliver to said Nevins & Flournoy a good and sufficient deed to said land and timber on payment of the purchase price; that said clerk of the Superior Court of Chatham County, in the exercise of his sound discretion, refused to confirm said sale; that from such refusal to confirm, the said Nevins & Flournoy excepted and appealed to this court.”
    Upon these facts, his Honor, being of opinion that the clerk was acting within his authority in refusing to confirm the sale, entered a decree confirming the judgment, and Nevins & Flournoy, the bidders at the sale, having duly excepted, appealed.
    
      Fred W. Bynum, for plaintiff.
    
    
      Percy J. Olive and J. 0. Little for appellant.
    
   Hojeus, J.

The statute bearing more particularly on the question presented, Revisal, sec. 2513, is as follows: “The court may authorize any officer thereof, or any other competent person, to be designated in the decree of sale, to sell the real estate under this proceeding; but no clerk of any court shall appoint himself or his deputy to make sale of real property or other property in any proceeding before him. Such officer or person shall file his report of sale, giving full particulars thereof, within ten days after the sale, in the office of the clerk of the Superior Court, and if no exception thereto is filed within twenty days, the same shall be confirmed: Provided, that any party after the confirmation shall be allowed to impeach the proceedings and decrees for mistake, fraud, or collusion, by petition in the cause: Provided further, that innocent purchasers for full value and without notice shall not be affected thereby.” And it is contended for defendants that by virtue of the clause in the section, “and if no exception thereto is filed within twenty days, the same shall be confirmed,” they are entitled to have the sale confirmed as of right and notwithstanding the increased bid of $1,500.

Prior to the enactment of this clause, and so far as the rights of a bidder at a judicial sale was concerned, the court, before confirmation, had well-nigh unlimited discretion as' to the acceptance of the bid. Such a bidder acquired thereby no independent right in the property or in the suit. His offer was considered only as a proposition to buy at the price named, the court reserving the right to accept or reject the bid, as it might decree best. Harrell v. Blythe, 140 N. C., 415; Rorer on Judicial sales (2d Ed.), sec. 108. In Harrell’s case, Walicer, J., delivering the opinion, said: “Where land is sold under a decree of court, the purchaser acquires no independent right. He is regarded as a mere preferred proposer until confirmation, which is the judicial sanction or acceptance of the court, and, until it is obtained, the bargain is not complete.” And, in Rorer, sec. 108, it is said: “The court is clothed with an unlimited discretion to confirm a judicial sale or not, as it may seem wise or just. Confirmation is final consent, and the court being the vendor, it may consent or not, in its discretion.” True, this author, in a subsequent section, says that the matter of confirmation rests in the sound legal discretion of the court, and the same may be reviewed on appeal, but this, except on motion to relieve a bidder from a proposal superinduced by' fraud or excusable mistake, must be understood to refer rather to the question as it affects the rights or interests of the parties which are already involved in the suit, and not to the bidder, who as yet has acquired no standing or interest therein. Harrell v. Blythe, supra; Joyner v. Futrell, 136 N. C., 302; Hall v. Taylor, 133 Ga., 606; Rorer Judicial Sales, sec. 110. On the matter of confirmation, in that aspect of the case it has not been,.in accord with the practice in this State to refuse to confirm a sale for inadequacy of price unless there has been an advanced bid and by a responsible bidder, and on average or lesser values, an increased bid of 10 per cent has usually been regarded as sufficient to justify the court in reopening the biddings. "Where amounts are large, the advance per cent need not be so much. A distinction recognized by statute as to sales under decree of foreclosure, etc., by chapter 146, Laws 1915, making 5 per cent sufficient when the amount of bid is over $500. But, while these rules are usually observed, they are not absolutely imperative, and the question of confirming a sale is referred, as stated, to the sound legal discretion of the court, and, in the proper exercise of such discretion, the court, under certain conditions, may reject an increased bid and confirm a sale when it appears from the relevant facts and circumstances that such a course is wise and just and for the best interests of all parties whose rights are being dealt with in the suit. Thompson v. Rospigliosi, 162 N. C., 145; Uzzle v. Weil, 151 N. C., 132; Dula v. Seagle, 98 N. C., 458; Wood v. Parker, 63 N. C., 379. After confirmation, the power of the court is much more restricted. The purchaser is then regarded as the equitable owner, and the sale, as it affects him or his interests, can only be set aside for “mistake, fraud, or collusion” established on petitions regularly filed in the cause. Revisal, sec. 2513. Ashbee v. Cowell, 45 N. C., 158; Kampman v. Nicewaner, 60 Neb., 208; Va. Ins. Co. v. Cottrell, 85 Va., 857.

Considering this legislation in view of these recognized powers of the court in the case of judicial sales, we are of opinion that, on the facts as embodied in his Honor’s judgment, appellant’s. position cannot be maintained. So far as we are aware, tbe clause relied upon appears for tbe first time in tbe Code of 1883, sec. 1906. Prior to tbat, these sales were confirmed on motion and after notice, Laws 1868-9, cb. 122, secs. 5 and 15; and tbe primary purpose of tbe amendment was to relieve tbe parties and tbe proposed purchaser of tbe delays and uncertainties incident to tbis requirement for further notice, etc. In causes having numerous parties, in many instances widely scattered and at times nonresident, tbis requirement for further notice might and frequently did present a real obstacle in tbe successful conduct of such sales, both in tbe matter of time and cost, and tbe law was enacted to enable tbe court to proceed to judgment on tbe record as it stood, after twenty days, and to shut off all right of exceptions for irregularities, lack of notice, or even inequalities as between tbe parties to tbe record, and it was never intended to deprive tbe court of tbe power to regulate and control a sale by reason of advanced bids made and entered before tbe purchaser appeared and moved tbat bis bid be accepted $nd sale confirmed. Tbis right tbe statute confers upon him and, under its provisions, be can appear at tbe end of tbe twenty days or after, and if an increased bid has not been made at tbe time of motion entered, be is entitled to have tbe same allowed, and on tbe record as it then appears. Until such move is made on bis part, tbe powers of tbe court in reference to confirming tbe sale for inadequacy of price may be determined in its legal discretion. Tbis increase of bid is not in strictness an exception by tbe parties, tbe objection more directly contemplated by tbe statute, but a recognized method of affording information to tbe court tbat tbe property has not brought a fair price, and, as stated, these facts may be considered and acted on if presented before tbe purchaser has appeared and moved for confirmation of sale.

Tbis, in our opinion, being tbe proper construction of the law, bis Honor has made correct ruling on tbe matter presented. In a sale, to an amount greatly in excess of tbe average, $26,000, there has been an advance bid by responsible parties of $1,500. True, tbis was made one day after tbe expiration of the time limit, but it was made before the bidder bad appeared to insist on bis rights, and, under tbe facts of tbe record, tbe clerk was right and certainly acting within bis powers in refusing to confirm tbe sale. We have been referred by counsel to the case of Floyd v. Rook, 128 N. C., 10, as an authority against our disposition of tbe appeal. Tbat was a case of actual partition and in which exceptions from some of tbe parties of record, filed after twenty days, were disallowed for tbat reason. It does not distinctly appear in tbat appeal what was tbe nature of these exceptions. Doubtless they were for some irregularities in tbe proceedings or because of some inequitable adjustment. In either case they were known to tbe parties at tbe time tbe partition was made or wben tbe report was filed, and sueb objections come more nearly witbin tbe express terms and purpose of tbe statute. In our view, tbe case is not in necessary conflict witb our present decision, to tbe effect tbat tbe .statute does not and was not intended to impair tbe power of tbe court as to confirmation of judicial sales for inadequacy of price, evidenced by an increased and sufficient bid made before tbe proposed purchaser has appeared and moved for an acceptance of bis bid, as be can now do under tbe law after twenty days.

There is no error, and tbe judgment of the court is

Affirmed.