Court Opinion

ID: 3863585
Source: CourtListenerOpinion
Date Created: 2016-07-06 08:57:07.755561+00
Date Added: 2024-06-11T14:23:12.133320
License: Public Domain

A brief review of this case will show the reasons for the order which the court must now make. The original decree declared a lien in favor of the Quidnick Company for so much of its funds as had been mingled with the trust estate, and for security, as it was impracticable to hold the property, directed a sale and deposit of the proceeds to await the account. No directions were given as to the mode or terms of sale, which were left wholly to the trustee's discretion and the authority he already possessed under the trust mortgage to sell at public or private sale, in bulk or in parcels. The trustee in December last was proceeding to carry out this order, by advertising to sell in parcels at auction; but within a few hours of the appointed time of sale of the first piece of property, certain persons, claiming to be creditors under the trust mortgage, interfered to stop the sale by an injunction. Pending a motion to dissolve this injunction, negotiations were had and offers made to the trustee for a sale of the entire property for a fixed sum, culminating in an offer to bid the highest amount named, at an auction sale. These offers were communicated to the court, accompanied by petitions bearing the signatures of persons claiming to represent upwards of seven eighths in amount of the creditors, together with the approval in open court of counsel representing all the parties in interest, that the court should direct the trustee to accept one or the other offer.
These petitions, no one, after ample notice, appearing to object, together with the statements of counsel on both sides of the suit, showed clearly that, notwithstanding a lack of harmony among the creditors in other respects, there was a unanimous desire to have the property disposed of in bulk.
The trustee then presented to the court a letter addressed to him by the committee of creditors, containing the following suggestions:
"If we rightly interpret the reported statement made for the Supreme Court by the presiding judge at the hearing on the 11th instant, we infer that the court are desirous, in so far as they can properly act in the matter, that the property should be sold in a *Page 420 
mass to the party or parties making the best offer for it. Assuming that we are correct in this inference, we would urge that it is of great importance, in order to secure the highest price for the property, that all parties should have an opportunity to make their bids understandingly, on some definite terms to be fixed by you as to time and manner of payment and the title to be given. If each bidder is to be allowed to fix his own terms, it will prove difficult for you to decide as to the merits of various offers. We would, therefore, suggest that you apply at once to the court for authority to offer the entire property in one parcel at auction to the highest bidder, not to be sold, however, for a sum less than twenty-eight hundred and eighty thousand dollars, you fixing such terms of sale as shall fullyprotect the rights and interests of creditors."
In view of the apparent competition for the estate, this suggestion was not only a reasonable one, but the duty of complying with it was imperative; for we could neither disregard the unanimity of the creditors in regard to selling the whole at once, nor the fact of an offer to bid as proposed at an auction sale by a party whom the trustee certified to us he believed "to be reliable."
Recognizing the fact that the estate equitably belongs to the creditors, and that they, therefore, are entitled to say in what way their interests will be best subserved in its sale, and relying, as it is customary, and necessary to do in all matters of business, on the obligation of written promises and commercial honor, we advised the trustee to sell the estate at auction at the upset price offered, pursuant to the general request of the creditors as to a sale in bulk, and the particular request of the creditors, through their committee, as to the sale by auction.
While these matters involved no questions of law and are not strictly judicial, it nevertheless became necessary for the court to pass upon them; because as all these offers provided for a partial payment in cash and for instalments to lie back, the trustee, upon the acceptance of either one of them, could not deposit the proceeds as at first directed without some change in the original decree. The whole matter was thus brought before the court, and upon the showing made the change asked for, appearing to be a *Page 421 
reasonable and proper one, the order of March 22, 1882, was entered. In making the order the court has not undertaken to administer the trust nor to conduct the affairs of the trustee, but simply to carry out the almost unanimously expressed wishes of the creditors, both by their own petitions and through their committee, and at the same time to protect as best we could the interests of all parties before us and the lien which he had declared.
The trustee now informs us that the offer to bid at the proposed auction has failed. Of course, then, our last order must be revoked, leaving the matter as it stood under our original decree, and as it would have remained, and doubtless long ago have been completed, but for the intervention of the creditors themselves.
Under that decree the trustee is free to sell in any of the ways authorized by the trust mortgage. If, however, the creditors are still desirous that the property shall be sold in bulk, and the trustee shall receive a satisfactory offer of that kind, a proviso, to save the trouble of a new application, may be added to our original decree, authorizing the acceptance of such offer, upon terms substantially similar, except in amount, to those embodied in our order of March 22d.
Decree entered May 24, 1882. This cause came again beforethis court on the 24th day of May, A.D. 1882, upon the report ofZechariah Chafee, trustee and assignee, setting forth his failureto effect a sale of the estates mentioned in the decree of March22, A.D. 1882, under the terms named in said decree, and that nobidder appeared to offer the upset price required by said decreeto start the sale, and asking for instructions in the premises;and now, upon consideration of the facts set forth in saidreport, and of the cause, it is ordered, adjudged, and decreed:
First. That the said decree of March 22, A.D. 1882, be, andthe same is hereby rescinded.
Second. The third clause of the order of this court enteredNovember 5, A.D. 1881, is hereby revived and reestablished, withthe amendment striking out the words "upon its participationaccount," and adding the following: "Provided, however, that ifsaid Chafee shall receive an offer for the entire estate for aprice *Page 422 satisfactory to him, he may sell the same at private sale uponterms substantially similar, except in amount, to those embodiedin our order of March 22, 1882; and in case of such sale, theproceeds received from time to time by the said Chafee may bedistributed, as was provided in said order of March 22, 1882.
Chafee, the trustee, annexed to his reports setting forth the failure to sell, copies of letters received from Wilbour, Jackson Company, of Providence, as follows:
"PROVIDENCE, R.I. March 3, 1882.
"Z. CHAFEE, ESQ., Trustee:
"Dear Sir, — In case the Supreme Court should advise the selling of the Sprague estate at auction in bulk, at an upset price of $2,880,000, we hold ourselves ready and will make a bid of this amount to start the property, payments to be made on the terms suggested to you by the creditors' committee in their letter of the 22d ultimo, and agreeing on our part to take such title as you can give as trustee and assignee. Will you please consider this confidential, and oblige,
                      "Very respectfully yours, "WILBOUR, JACKSON  Co."
"PROVIDENCE, R.I. May 3, 1882.
"Z. CHAFEE, ESQ., Trustee, c.:
"Dear Sir, — We observe by the public papers that you have advertised a sale of the Sprague estates for May 4, 1882.
"Since the terms of sale as advertised are different from those contemplated in our letter of March 3, 1882, and in consequence of recent threatened complications of the estate, neither we nor our associates will appear as bidders at the advertised sale.
                               "Very respectfully yours, "WILBOUR, JACKSON  Co."
Chafee also made affidavit that Wilbour, Jackson  Co., March 3 or 4, and before a hearing which took place March 4, gave him full authority to have their letter of March 3 read in court.
At the hearing March 4 the letter of March 3 was read to the court. This hearing was followed by the opinions of March 8, and the decree of March 22 above given. *Page 423 
Thereupon the court ordered a citation to issue to Joshua Wilbour, Benjamin A. Jackson, Charles H. Sheldon, Junior, and William Binney, Junior, members of the firm of Wilbour, Jackson 
Co., requiring them to show cause why they should not be attached for contempt of court.
They showed as cause that they were neither parties to the cause, nor witnesses, nor otherwise interested therein, that they had committed no contempt, and that they had neither impeded nor hindered any action of the court and its officers or the operation of any decree.