Case Name: Commonwealth Trust Company General Mortgage Investment Fund Case
Court: Supreme Court of Pennsylvania
Jurisdiction: Pennsylvania
Decision Date: 1947-07-03
Citations: 357 Pa. 349
Docket Number: Appeal, No. 85
Parties: Commonwealth Trust Company General Mortgage Investment Fund Case.
Judges: Before Maxey, C. J., Drew, Linn, Stern, Patterson, Stearne and-Jones, JJ.
Reporter: Pennsylvania State Reports
Volume: 357
Pages: 349–368

Head Matter:
Commonwealth Trust Company General Mortgage Investment Fund Case.
Argued March 27,1947.
Before Maxey, C. J., Drew, Linn, Stern, Patterson, Stearne and-Jones, JJ.
reargument refused September 17, 1947.
John A. Metz, Jr., with him Ben Paul Brasley, John A. Metz, Brasley, Rubin, Balter <& dole, Metz & Metz and Aronson & Levy, for unsuccessful bidder, appellant.
Albert G. Hirsch, with him Weil, Hirseh d Shumaker, for Commonwealth Trust Company of Pittsburgh, appellee.
Leon Savage, for successful bidder, appellee.
July 3, 1947:.

Opinion:
Opinion by
Mr. Justice-Patterson,
Where, after competitive bidding in open court upon a petition by a fiduciary for leave to sell real estate at private sale, the court enters an order approving the sale to the highest bidder, and, subsequently thereto, an agreement of sale is executed by the fiduciary and the highest bidder, containing an. additional provision reserving to the fiduciary the right to rescind and sell to a subsequently higher offeror, is that agreement binding upon the highest bidder and is it an agreement within the intendment of the Act of 1945, P. L. 944, 20 PS section 818, which provides, inter alia, "except as otherwise agreed by the parties"?
Commonwealth Trust Company of Pittsburgh, appellee, in its capacity as a trustee, petitioned the Orphans' Court for leave to sell a certain piece of real estate at private sale to one Gabriel G. Rubin for $46,000. On February 6,1946, competitive bidding was had before the court, and H. J. Shapiro, appellant, made the highest bid, to wit, $61,000. The court accepted his bid, made an order approving the sale and authorizing the fiduciary to execute a deed upon terms and conditions contained in the order. Subsequently thereto, appellant and the trust company executed an agreement of sale embodying the terms of the order, but including therein the following clause: "It is the understanding of the parties hereto that this Agreement covers property in a Trust Estate and that the Vendor in its fiduciary capacity is legally obliged to accept any higher or better offer which it receives prior to the approval of the within sales agreement by the Orphans' Court of Allegheny County, Pa. If the Vendor receives a higher or better offer than the terms of the within Agreement, it has the right to revoke the within Agreement at any time prior to the consummation of the within sale and to refund the payment made on account of the purchase price without further liability to the Vendee."
On March 12, 1946, five days after the date fixed by the court for settlement, the trust company received a higher offer from the Atlanta Realty Corporation. The following day appellee presented to the Orphans' Court a supplemental petition requesting the court to set aside its order of February 6, and approve a sale to the subsequent offeror. PI. J. Shapiro, appellant, filed an answer to said petition requesting that the petition be dismissed and that appellee be ordered to deliver to bim a deed for the property pursuant to the court's order of February 6.
The court, relying upon the unconstitutionality of the Act of 1945, supra, set aside its prior order of February 6, and entered a new order approving the sale to the Atlanta Realty Corporation. This appeal is from the decree of the court below dismissing exceptions to said decree and approving the sale to said Realty Corporation. In its opinion, the court stated: "Our position has been that the Act of May 24, 1945 (No. 374) which, if valid, prevents setting aside a sale for an inadequate price, is unconstitutional and cannot be given effect in this court."
Appellant contends that the additional provisions in the agreement of sale executed subsequent to the order of the court approving the sale to him were without consideration. Appellee contends that the decree of the court below, having been made prior to this Court's opinion in Brereton Estate, 355 Pa. 45, 48 A. 2d 868, the court below properly set aside its prior order of February 6, 1946.
Appellee's contention is entirely without merit. The Act of May 24, 1945, supra, upheld as constitutional by this Court in Brereton Estate, supra, was operative from the effective date prescribed by the legislature. The instant case must, therefore, be viewed in that light. In that case this Court said (page 57) : "Accordingly, in the words of the opinion filed below, when, 'after competitive bidding, the court ordered a private sale . . . for $27,850.00, secured by a certified check, whereupon the ancillary executor was directed to make a deed for the property described in the petition,' the contract was completé. All the terms had been agreed upon and the contract had been approved by the court. The court's approval of the contract passed the title to the property in the absence of fraud, accident or mistake subject, of course, to the payment of the consideraton. Prior to the Act, title did not pass until the delivery of the deed: Demmy's Appeal, 43 Pa. 155, 168. After that, the court, consistently with the Act of May 24, 1945, could not set aside the contract merely because the appellee made a substantially higher offer."
Fraud, accident or mistake in the negotiations and proceedings culminating in the order of February 6,1946, do not appear in this record. Equitable title passed to appellant upon entry of the court's order approving the sale by the fiduciary. When, subsequent thereto, the fiduciary procured appellant's signature to an agreement of sale, not in conformity with the order of the court, new promises therein made could only be valid and enforceable if supported by legally sufficient consideration. There was ho consideration to support the added provision giving to the fiduciary the power to rescind prior to the consummation of the sale and to accept a higher and better offer.
"Where a legal obligation exists, a cumulative promise to perform it, unless upon a new consideration, is a nullity. Such promise adds nothing to and takes nothing from the original obligation. . A promise cannot be conditioned on a promise to do a thing to which a party is already legally bound . . : Wimer v. Overseers of the Poor of Worth Township, 104 Pa. 317, 320; Erny v. Sauer, 234 Pa. 330, 334, 83 A. 205. " 'A promise to do what the promisor is already bound to do cannot be a consideration, for if a person gets nothing in return for his promise but that to which he is already legally entitled, the consideration is unreal' ": Quarture v. Allegheny County, 141 Pa. Superior Ct. 356, 363, 14 A. 2d 575. "Doing what one is already legally obliged to do is not good and sufficient consideration": Murray v. Prudential Insurance Co., 144 Pa. Superior Ct. 178, 187, 18 A. 2d 820; Tradesmen's National Bank v. Cummings Bros. Co., 306 Pa. 280, 282, 159 A. 452. The court's approval of the sale to appellant operated to vest in him equitable title to the property. The contract was complete and appellee was under legal duty to convey legal title to him in accordance with the court's decree. This was the only act which'was promised by the fiduciary in the subsequent agréement. When, therefore, appellee secured appellant's signature to an agreement of sale not in conformity with the court's decree, it undertook to do nothing more than it was already legally obligated to do.
"One of the tests of consideration is whether the promisee, at the instance of the promisor, has suffered any detriment, or whether in return for the promise he has done something that he was not bound to do or has promised to do some act or has abstained from doing something. . If the promisee has suffered any detriment, however slight, or, though he has suffered no real detriment, if he has done what he was not otherwise bound to do, in return for the promise, he has given a consideration . . Mikos v. Kida, 314 Pa. 561, 563, 172 A. 101. Clearly the promisee, the fiduciary, had done nothing nor has it promised to do anything which it was not already legally bound to do. There was no consideration to support-the additional terms incorporated into the agreement of sale.
It should also be notéd that the provision of the agreement in question was stated to be based upon facts which did not exist. The agreement provided that the •vendor "in its fiduciary capacity is legally obliged to accept any higher or better offer which it receives prior to the approval of the within sales, agreement by the Orphans' Court. . . ." The fiduciary was not then legally obligated to accept any higher offer. Nor was it required to. secure approval of the sales agreement. That approval had already been secured and the written agreement was; to have been executed in accordance therewith.
In the absence of any evidence to the contrary, an agreement under seal imports consideration. When, however, the agreement itself reveals, the insufficiency or lack of .consideration, the rule will not be applied to the detriment of the promisor. The promisee will not be permitted to secure an advantage and thereby deprive the promisor of that to which he is legally entitled. Cf. Jeffers v. Babis, 304 Pa. 281, 287, 155, A. 878.
The legislature is presumed to have intended that words used in a statute shall be construed according to their common and approved- uses: Statutory Construction Act of 1937, P. L. 1019,.46 PS section 33. The use of the words "except as otherwise agreed by the parties" cannot be interpreted in a manner which would dis regard long settled principles of contract law, and validate and make enforceable agreements lacking sufficient consideration. We need not indulge in speculation as to wbat the legislature might have intended. The word "agreed" has a precise and well settled meaning in our jurisprudence. There is no expressed legislative intention that it should be given any other meaning. The phrase cannot refer to promises nudum pactum. The legislature intended promises supported by legally sufficient consideration.
The decree of the court below is reversed and the record remanded with instructions to dismiss the supplemental petition and reinstate the prior order of February 6,1946. Costs to be paid by appellee.