Case Name: Dudley et al., Heirs of I. Ludlow, v. William Little
Court: Supreme Court of Ohio
Jurisdiction: Ohio
Decision Date: 1826-12
Citations: 2 Ohio 504
Docket Number: 
Parties: Dudley et al., Heirs of I. Ludlow, v. William Little.
Judges: 
Reporter: Cases decided in the supreme court of ohio : upon the circuit at the special sessions in Columbus
Volume: 2
Pages: 467–469

Head Matter:
[The following two.cases, decided on the circuit in 1826, were emitted in their proper place, and are here inserted :]
Dudley et al., Heirs of I. Ludlow, v. William Little.
Upon a sale of land for taxes, an agreement among several that they will advance funds, and one shall buy, so as to prevent competition,.and afterward divide the land purchased among them, is fraudulent, and equity will relieve against the purchase.
This case was heard in Delaware county, before Judges Burnet and Sherman, in 1826.
The bill stated that the complainants, as heirs at law of Israel Ludlow, were the proprietors of a tract of land situated in the-county of Delaware, on which the taxes had not been paid; that at a sale of land for taxes, three hundred and seventy acres of the land in question, worth three dollars per acre, had been sold by the collector, and purchased by the defendant for thirty-three dollars and seventy-three cents. The bill charges that a fraudulent combination had been formed by the defendant and sundry other persons, to purchase large tracts of land at the said sale for-the purposes of speculation ; that it had been agreed between the defendant and those who weie to participate in the profits of the speculation, that the defendant alone should bid; that the other partners in the contract should advance their portions of the purchase money, and receive their share of the profits; and that, in-pursuance of that fraudulent agreement, the defendant had purchased the land in question, and obtained for it a collector’s deed. The prayer of the bill was to set aside the deed and restore the* complainants, etc.
The defendant demurred to the bill.
*J. K. Cory, for the complainants,
cited 4 Johns. Ch. 254; 3 Johns. Cas. 29; 6 Johns. 194; 8 Johns. 444.
Pettibone, for the defendant,
cited Steele v. Worthington, 2 Ohio, 182.

Opinion:
By the Court :
A partnership or contract formed for the purchase of land at sale for taxes, is against the policy of the law; and if such contract or partnership be entered into for the express purpose of making such purchases, it is a fraud on the owner of the property,, and the purchaser can not obtain an available title.
Such combinations have, necessarily, a direct tendency to prevent competition, which it is the duty-of the legislature and the-policy of the law to encourage. Over a sale of this description, the owner has no control — he can not refuse a bid, or adjourn the-sale, or fix a sum below which the property shall not be struck down. The sale is managed by the agent of the state. The. owner is not consulted. The highest bidder becomes the purchaser, although the sum bid be less than a hundredth part of the* value of the property. This being the case, any combination which has a tendency to reduce the price of the property, by preventing competition, must operate as a fraud on the owner. The • effects of such combinations can not be controlled by any vigilance on the part of the owner.
It frequently happens that large quantities of land are offered for sale on these occasions, in the absence and without the knowledge of the owners; and if such combinations are permitted, all the persons present at the sale might form themselves into companies, and, by an agreement not to bid against each other, might purchase in the whole of every tract offered for the amount of tax -due on it.
We do not mean to say that partners can not purchase property •at a tax sale, for the convenience of the business they are engaged in, when speculation is not their object, but that a partnership or combination can not legally be formed for the purpose of making such purchases. As this *was evidently the fact in the case before us, the complainants are entitled to a decree. They must take it, however, on the condition of refunding the purchase jnoney and interest, with the penalty of fifty per cent, allowed by law, and on the payment of cost.