Case Name: George Kinloch and Thomas W. Mordecai ads. Sarah H. Savage
Court: South Carolina Court of Errors
Jurisdiction: South Carolina
Decision Date: 1844-01
Citations: 1 Speers Eq. 464
Docket Number: 
Parties: George Kinloch and Thomas W. Mordecai ads. Sarah H. Savage.
Judges: Dunkin and Harper, Chancellors, concurred.
Reporter: South Carolina Equity Reports
Volume: 17
Pages: 464–474

Head Matter:
George Kinloch and Thomas W. Mordecai ads. Sarah H. Savage.
1. K. and M. partners in trade, being indebted to one F. gave him. their penal bond, on the 23d. of April 1836, conditioned to pay the debt in two years, and also a mortgage of certain real estate to secure the payment. The mortgagee, on the 27th of the same month and year, assigned the bond and mortgage to the complainant. Partnership dissolved on the 1st of January, 1839, and by consent, all the real estate of the firm was sold on the 1st of May following, including the property mortgaged and purchased by defendant M; who becoming embarrassed, on the sixth of May, assigned to T. his whole estate, for the benefit of his creditors, one W being appointed agent for the benefit of creditors, under the Act oí the Legislature. In July, 1839, E. who was the general agent of complainant, and the assignee and agent, agreed to sell the mortgaged property to satisfy the bond and mortgage, and employed a Master in Equity to make the sale ; but before the sale, complainant’s agent addressed a note to the Master in the following terms. “In the sale of K. & M’s house on Chisholm’s Wharf, mortgaged to Miss Savage, for $3500, with interest due thereon from April 1838,1 will thank you not to let it go for a less amount than will cover her claim.” On the 30th of July 1839, the property was offered by the Master, and a bona fide bid made of $3600, but at the request of the Master, a person present bid $3700, in pursuance of the instructions in the note of complainant’s agent; and no one bidding more the sale was closed. The Master did not regard it as a sale, nor did he suppose the parties did. He made no memorandum in writing of the sale. At the request of complainant the property was again advertised for sale, but the assignee of M. insisting on the sale already made, the property was not offered. No titles were demanded or tendered, and the property remained unoccupied. A release of the equity of redemption was tendered to complainant and refused.
2. There being no memorandum in writing of the sale made at the time by the auctioneer, nor signed by either of the parties, the contract, if one was made, was within the statute of frauds, and not binding: — and as to the letter from complainant’s agent to the auctioneer, held not a sufficient compliance with the statute.
3. Defendant M having been discharged both under the insolvent debtors Act of this State, and under the bankrupt law of the United States, pled it in bar to any money decree against him ; plea allowed.
Bill for Foreclosure of Mortgage.
The bill stated, that George Kinloch and Thomas W. Mordecai executed to James Fife their joint and several bond, bearing date 23d April, 1836, in the penal sum of $7000, conditioned to pay $3500, with interest from the date, in two equal instalments; and in order to secure the payment of the said bond, mortgaged to him a lot of land and store, on North Commercial Wharf, in Charleston; Which bond and mortgage were assigned by James Fife, on the 27th April, 1836, to the complainant, for valuable consideration. That Thomas W. Mordecai, being after-wards in failing circumstances, and intending to apply the sales of his estate to the payment of his debts, did, on the 6th May, 1839, assign all his estate, real and personal, including the above mentioned lot of land and store, to Abraham Tobias, in trust, foi the payment of his debts» The prayer of the bill is for foreclosure of the mortgage, and a sale of the premises, to pay the above stated bond of George Kinloch and T. W. Mordecai; and for the payment of any deficiency by George Kinloch.
The joint and several answer of the defendants admits the bond and mortgage and the assignment thereof to complainant» The answer further stated that,—
On 1st January, 1839, the copartnership of Kinloch Mordecai was dissolved.
On 1st May, 1839, all the real estate which Kinloch & Mordecai held, as tenants in common, was offered, by their joint consent, for sale, at public auction; at which sale, T. W. Mordecai became the purchaser of the lot and store described in the bill, assumed upon himself the payment of complainant’s bond, and took possession of the premises.
On 6th May, 1839, T. W. Mordecai became suddenly embarrassed in his circumstances, by unexpected events, and made an assignment of all his estate, real and personal, including his interest in the said lot and store, to Abraham Tobias, (as stated in the bill,) iii trust, for his creditors, subject, nevertheless, to complainant’s mortgage. At a meeting of Mordecai’s creditors, soon afterwards, John Williams was appointed agent of the creditors, to act in concurrence with the assignee, conformably to the Act of Assembly.
That William S. Elliott was the agent and attorney of the complainant, as appears by his receipts for interest indorsed on the bond, and transacted all her business.
In July, 1839, William S. Elliott, the agent and attorney of complainant, and A. Tobias and John Williams, assig-nee and agent of creditors of T. W. Mordecai, entered into an agreement, by which it was mutually agreed that the said lot and store on Commercial Wharf, (mortgaged by defendants to James Fife, assigned to complainant, purchased by T. W. Mordecai at auction, taken into his possession, and assigned in trust for his creditors,) should be put up at public auction, as the property of T. W. Morde-cai, in order to pay the bond of Kinloch & Mordecai to the complainant; and that the sale should be made by Edward R. Laurens, as their mutual agent. According to this agreement, the mortgaged lot was advertised by E. R. Laurens, for public sale, on 30th July, 1839, as appears by the advertisement, Exhibit A.
On 13th July, 1839, William S. Elliott, agent and attorney of complainant, wrote to E. R. Laurens, the auctioneer, the following instuctions, viz:
Charleston, July 13, 1839.
“Dear Sir — In the sale of Kinloch & Mordecai’s house on Chisolm’s Wharf, mortgaged to Miss Savage, for $3500, with interest due thereon from April, 1838, I will thank you not to let it go for a less amount than will cover her claim.
Yours, WM. S. ELLIOTT.
To Edward It. Laurens.”
On 30th July, 1839, the day of sale, the mortgaged premises were offered at public outcry, many persons were present, many bidders competed for the property, and a bona fide bid of $3600 was made by an independent purchaser; but under the above letter of instructions from complainant’s agent, the premises were knocked down to complainant, for the amount of her debt, say $3700, as the highest and last bidder for the same. The complainant, as mortgagee, having thus purchased the equity of redemption in the premises, the whole estate became vested in her, and according to the adjudications of this court, the mortgaged debt was extinguished, and the bond of Kin-loch & Mordecai thereby cancelled.
If any injury has accrued to complainant, her own course of conduct has created it, and she has no right to visit on defendants her own acts. A bona fide purchaser had hid $3600, at the auction, for the property, which, at that time, was about equal to complainant’s debt; but by bidding $3700, she defeated a bona fide sale, which the of-ferer would willingly have complied with. If, therefore, she could have had her debt paid, if she had not overbid the bona-fide bid of 3600, she cannot justly complain ; and if she comes to this court to seek equity, she ought to lay a foundation for her claim by doing equity to others, and by complying with her contract, and paying the amount of her own bid at the sale. The defendants submit to the court, whether the complainan't ought to be supported in the course adopted by her agent, in offering property for public sale to the highest bidder, and then by private instructions to the auctioneer, restricting the price to the amount of her own debt, without notice to the public of such instructions. Notice of an intended sale by auction, seems to be a contract with all the world, and the party who varies that contract, by private instructions, must bear its consequences. The defendants being thus legally and equitably discharged from the bond, paid no further attention to the subject, and at a long subsequent day, were greatly surprised to hear that complainant éntertained the intention of endeavoring to make them further liable for any part thereof. Defendants infer, that the depreciation of the value of property could alone have suggested this idea to her; for if property had risen, or even been stationary, probably this pretension would never have been set up. Defendants contend that they are discharged from the bond by complainant’s acts. After the sale, defendants never had possession of the premises, nor did the assignee and agent of creditors of T. W. Mordecai ever pretend to have any claim in the same; all parties deeming the mortgaged premises to be the property of complainant, by virtue of her purchase at the sale.
Shortly afterwards, William S. Elliott died, without demanding titles; but these defendants, together with Tobias and Williams, the assignee and agent of creditors of T. W. Mordecai, tendered to complainant a deed of the re lease of the equity of redemption, which she refused to accept. The complainant could have taken possession of the premises at any moment she pleased, from the time of sale to the present time.
At October term, 1840, oomplainant brought an action at law against T. W. Mordecai, on the bond; and at January term, 1841, he took the benefit of the insolvent debtors Act.
In January, 1842, T. W. Mordecai applied for the benefit of the bankrupt Act, and obtained his discharge as a bankrupt from the district Court of the United States, according to the Act of Congress; and he now pleads his discharge as a bankrupt, in bar of all further claim and demand of the complainant'upon him.
The case was tried before Chancellor Johnson, in March, 1843.
In substance, Mr. Laurens proved that he was applied to by William S. Elliott, the acknowledged agent of complainant, and by George Kinloch, A. Tobias and John Williams, assignee and agent of creditors of T. W- Morde-cai, to sell the premises at auction, as mutual agent for all parties. That W. S. Elliott wrote him the note stated in the answer. That at the sale, Tobias, on his own account, bid $3600 for the property, but under the instructions from W. S. Elliot, he bid $3700, and the property was knocked down to complainant. He made no entry of the sale in his books, as the parties seemed to understand each other perfectly well. The price of $3700 was cheap for the lot and store, at that time, but property has since greatly depreciated. States something of an indefinite general conversation with John Williams, at Norfolk, Virginia, about the sale. The property was re-advertised for sale in January, 1840, but stopped by Tobias. Did not consider it a sale.
A. Tobias proved the mutual agreement, that Laurens should sell the property. He attended the safe, and bid $3600 for the property, on his own account, as a speculation. Thinks he could have sold it for more immediately afterwards. The property was bid up for complainant to $3700; and he stopped bidding. Complainant could have taken possession when she pleased ; no other person pro- tended to have a claim or right to it. Unoccupied ever since.
John Williams proved the mutual agreement to sell, between William S. Elliot, complainant’s agent, and Kin-loch, Tobias, and himself, and that Laurens was to be their mutual agent and auctioneer. Does not recollect any conversation with Laurens, at Norfolk, on the subject.
Deed of release of equity of redemption from Kinloch, Mordecai, Tobias, and Williams, to complainant, tendered, and refused.
Johnson, Ch. The defendants being indebted to one James Fife, in the sum of $3500, on the 23d April, 1836, gave him their penal bond, conditioned for the payment of that sum in two years, with interest, and to secure the payment thereof, mortgaged the lot and buildings described in the pleadings; and the said James Fife, on the 27th of the same month of April, 1836, for full and valuable consideration, assigned the said bond and mortgage to the complainant. The defendants were, at the time, partners in trade, under the style of Kinloch & Mordecai. That partnership was dissolved on the 1st of January, 1839, and on the 1st day of May, of the same year, all the real estate belonging to the said firm was sold by consent, and at that sale, the defendant, Mordecai, purchased the lot and buildings in question. Mordecai, finding himself much embarrassed by debt, on the 6th day of the same month of May, made an assignment to Abraham Tobias, of his whole estate and effects, for the benefit of his creditors, and Mr, John Williams was appointed agent of the creditors, in pursuance of the Act of the Legislature. Some time in the month of July, of the same year, one William S. Elliott, the general agent of complainant, and the said Abraham Tobias and Williams, entered into an agreement, that the lot and buildings should be sold, to satisfy the said bond and mortgage, and for that purpose, employed E. R. Laurens, Esq., one of the masters of the court, to sell them at public sale. Mr. Laurens accordingly advert tised the sale. Before the sale took place, W. S. Elliott addressed a note, in writing, to Mr. Laurens, in which he requested him not to. let the property go for less thaq would' cover the amount due to the complainant, (then something over $3700.) On the 30th of July, of the same year, the property was offered at public sale by Mr. Lau-rens, and Abraham Tobias bid for it $3600, as he stated in his examination in court, in good faith, and with the intention of purchasing on his own account, at that price. In pursuance of the instructions contained in Mr. Elliott’s note, Mr. Laurens procured a friend, who happened to be present, to bid $3700, and no one bidding more, the sale was closed. Mr. Tobias stated, in his examination, that he had before heard that Elliott had authorized Mr. Lau-rens to bid for the property, the amount due to complainant, and he regarded this as a fair sale to Elliott, and that the business was finally closed. Mr. Laurens, on the contrary, testified that he did not himself regard it as a sale, nor did he suppose the parties did. He thought so, especially as he supposed the property went at too great a sacrifice ; for that reason he made no memorandum in writing of the sale. Mr. Laurens subsequently advertised the property for another sale, at the request of complainant, but was given to understand by Tobias, that the first would be insisted on, and it was not persisted in. No titles were demanded or tendered at the time, and the buildings have remained unoccupied ever since, neither party having interfered with it. Some time after, but at what precise time does not appear, a release of the equity of redemption was tendered to the complainant, which she refused to accept.
The bill prays, that the mortgaged premises may be sold, and that the equity of redemption be foreclosed ; and that if the sale should not amount to the sum of the debt, and interest due on the bond, the defendants may be decreed to pay any balance that remains. The defendant, Mordecai, pleads his discharge, both under the insolvent debtors Act of this State, and under the bankrupt law of the United States, as a bar to any money decree against himself; and that plea must be allowed. The opinion of Mr. Laurens, as to the fact of the sale, is relied on as conclusive that there was no sale. The rule, that the auctioneer is the agent of both the buyer and seller, to make the sale, is relied on to sustain this position, and, therefore, his views and opinions are conclusive as to the fact of the sale. As the salesman, all the authority he had was, to offer the property for sale, and receive the bids; but whether the sale was valid or not, was a matter of law, of which he had no authority to judge. There was, however, no memorandum in writing of the sale made at the time by Mr. Laurens, nor signed by either of the parties, and it is conceded, on all hands, that the contract, if one was made, is within the statute of frauds, and not binding, unless it is saved by the letter of instructions from Mr. Elliott, the acknowledged agent of the complainant, to Mr. Laurens, authorizing him to bid the amount of the sum due to complainant. The fourth section of the statute of frauds provides, among other things, that no action shall be brought, whereby to charge any one “upon any contract or sale of lands, tenements, (fee., or any interest concerning them, unless the agreement upon which such action shall be brought, or some memorandum or note thereof, shall be in.writing, and signed by the party to be charged therewith, or some other person thereunto to be by him properly authorized.” And in the construction of it, it has been settled, that a letter signed by even one of the parties proposing the terms of a contract, is binding on him, if accepted by the other party, although he, the party accepting may not.be bound. Clayson vs. Bailey, 14 Johns. Rep. 488. But it is essential, if the letter itself is relied on as containing the contract, that it should so define the terms, that nothing more than the simple acceptance by the party to whom it is addressed, will be required to complete it. Nor will evidence aliunde be admitted, to supply terms that are indefinite in themselves, or entirely Wanting. Boys vs. Ayersl, 6 Mad. 316; Bryce vs. Bletchley, 6 Mad. 19. In the language of the Lord Chancellor, in Kennedy vs. Lee, 3 Meriv. 451, “when there has been on the one hand a general proposal, and on the other an acceptance of that proposal, expressly leaving some particulars essential to the subject matter of the agreement, to be afterwards settled, there is no evidence before the court of such a contract as the court can enforce, upon the ground of the cardinal points having been agreed to by the parties.” The following are the essential terms of the letter, or note, addressed by William S. Elliott to Mr. Laurens. “ In the sale of Kinloch & Morde-cai’s house, on Chisholm’s wharf, mortgaged to Miss Savage, for $3500, with interest due thereon from April, 1838, I will thank you not to let it go for a less amount than will cover her claim.” And it would seem to import, that it was intended to offer the precise amount of that debt for the property, but the language, which is in general use, is universally interpreted as an authority to buy within that price, for it is rarely seen that purchasers at public sales are unwilling to buy at the lowest price they can, and the writing would have been equally binding on Elliott, if the property had been bid off at one dollar, as at the whole sum due to complainant. The want of certainty in the price to be paid, would be fatal to the operation of this letter, as a contract, if there w7as no other objection to it. But there is still another more conclusive. It was not intended by the writer as proposing the terms of a purchase. It was not addressed to Tobias and Williams, or shewn to them, the only persons authorized to treat about the sale, but to Mr. Laurens, the auctioneer, and contains nothing more than instructions to him to purchase on account of Elliott; in other words, to make a contract for the purchase. Mr. Laurens, himself, regards the circumstances attending the setting up the property for sale, as not amounting even to a parol agreement to purchase. However that may be, it was the only evidence that there was any sale at all, and as there was no memorandum in writing made, either by the auctioneer, or signed by any of the parties, it is not binding, but void under the statute of frauds.
It is, therefore, ordered and decreed, that unless the defendants shall, on or before the-day of-next, pay to the complainant the amount of principal and interest due on the mortgage set out in the pleadings, and the costs of this suit, the equity of redemption of the said Thomas W. Mordecai, and all other parties hereto, shall be, and is, hereby forever barred and foreclosed, and that one of the masters of this court do proceed to advertise and sell the premises, and pay to the complainant out of the proceeds of the sales, if they are sufficient, the amount of the said principal and interest, and the costs of this suit, to the officers of the court entitled thereto, and retain the remainder, if any, subject to the order of the court. And if the proceeds of the sales should be insufficient to pay the said principal, interest and costs, the defendant, George Kinloch, is hereby ordered and decreed to pay any balance thereof.
The defendant, George Kinloch, appealed—
1. Because Mr. Laurens was the actual, and not the constructive, agent of complainant; and his act, by her authority, was obligatory upon her.
2. That the letter of William S. Elliott was a sufficient compliance with the statute, inasmuch as the complainant, who was to be charged with the contract, was bound thereby.
3. That the contract of purchase was sufficiently certain to comply with the requisition of the statute.
4. To allow the complainant to get rid of her purchase, was to allow her to avail herself of her own wrong, to the prejudice of the defendant.
5. That by bidding $3700, complainant thereby defeated a bona fide sale for $3600, to the manifest injury of the defendant; and the consequences of her bid should not be allowed to work an injury to the defendant.
6. That the omission of Mr. Laurens to enter the sale in his book, (of which fact the defendant was not aware till the trial of the case,) he being her actual agent, was an act for which the defendant should not be solely responsible.
7. That the decree is, in other respects, contrary to law and evidence.
DeSaussure & Petigru, for appellants.
Elliott, contra.

Opinion:
Curia, per Johnson, Ch.
The court concur in the decree of the Circuit Court. A more correct view of the matter, probably is, that the letter of instructions addressed by Elliott to Laurens, was not an authority to buy, but directions not to sell, unless tlie property brought the amount of the debt due to the complainant. The probability is, that it would not now bring as much as the sum bid by Tobias, and withdrawing it from sale is complained of as an injury done to the defendants, for which indemnity is now claimed. But surely, the mortgagor cannot compel the mortgagee to foreclose his mortgage, and especially when, as in this case, the property mortgaged was the only certain security. That, indeed, would be reversing the order of things, by putting the mortgagee in the power of the mortgagor. The court might, and probably would, have entertained a bill against the complainant, at the instance of Kinloch, the security, to compel her to. proceed against his principal, but without this, the defendants had no right to compel her to sell whether she would or not. If they had wished to accept Tobi-as's bid, and had paid her the balance due on the bond, that would have put an end to all cause of complaint, and that they might have done,
Appeal dismissed.
Dunkin and Harper, Chancellors, concurred.
Johnston, Chancellor, absent from sickness,