Court Opinion

ID: 9613840
Source: CourtListenerOpinion
Date Created: 2023-08-22 04:20:19.544698+00
Date Added: 2024-06-11T18:03:32.329213
License: Public Domain

Gunderson, J.,
dissenting:
I must respectfully dissent.
The majority concludes a probate court has absolute power to set aside any estate sale sua sponte so long as the court’s judgment is in the “best interests” of the estate, such analysis fails to note a significant jurisdictional problem posed by our statutory scheme, and ignores established principles dealing with standing to interfere with estate actions.
In October, 1975, the executrices filed at “Petition for Instructions Regarding Sale of Personal Property,” seeking to sell a unique collection of 407,596 silver dollars. They sought instructions because one of them, Nell J. Redfield, the decedent’s widow and heir at law, as well as Dorothy DesChamps, sole beneficiary of decedent’s one-half community property interest in the collection, both believed detailed disclosure and description of the coins to the public at large would seriously depress the numismatic value of the collection. Consequently, they sought permission to sell the collection pursuant to the private sale provisions of NRS 148.170, rather than under NRS 148.190, which required publication of notice of sale, and confirmation in open court. The two remaining co-executrices doubted the applicability of NRS 148.170, and believed disclosure would not adversely affect the market price. Consequently, they joined with Nell J. Redfield in the petition for instructions.
At a November 4, 1975, hearing on the petition, the district court declared it was “satisfied that there is a real danger if this matter is opened up to public disclosure, and that there will be a diminishing value to the coin collection that is involved here. *500...” The court then entered an “Order Authorizing Executrices to Sell Certain Personal Property Pursuant to N.R.S. Section 148.170.”1 Although notice of entry was given, no appeal was taken, the parties apparently accepting the court’s determination.
Thereafter, the co-executrices and appellant A-Mark negotiated and executed a purchase agreement on December 17, 1975, selling the coin collection for $5,910,142. The purchase agreement was joined in, and agreed to, by Dorothy Des-Champs, the sole beneficiary of the estate, and by Nell Redfield individually, the widow and heir at law of the decedent. The price exceeded by more than 10 percent the appraised value of the property as determined by the court-appointed appraiser.
On December 18, 1975, two other coin dealers who had not seen the collection, Rare Coin Galleries and Bowers and Ruddy Galleries, instituted proceedings to prevent sale under the contract. They filed both a “Petition for Order to Inspect Personal Property and for Leave Thereafter to Bid Thereon,” and a “Petition for Temporary Restraining Order and Preliminary Injunction and a Bid to Purchase Personal Property.”
On December 29, 1975, the co-executrices, including the widow and heir at law, filed a motion to dismiss the petitions of the other coin dealers. The sole beneficiary later joined in the motion. At that time, all parties to the estate apparently were satisfied that the terms of the purchase agreement, including the sale price, were fair and equitable and in the best interests of the estate.
The district court subsequently held another hearing in January, and (1) vacated its prior order permitting sale pursuant to NRS 148.170, (2) canceled the existing contract with A-Mark, and (3) ordered a public sale. At the public sale, A-Mark was once again the successful bidder, but was now required to pay $7,300,000 for the collection.
*5011. The majority concludes: “Since the probate court acted within its authority in nullifying prior authorization ... we need not consider several other issues tendered by this appeal.” (Emphasis added.) I cannot agree. In my view, the district court did not act “within its authority.” The court lacked jurisdiction to set aside the A-Mark contract once it was executed on December 17,1977.
It is clear that once a sale takes place pursuant to NRS 148.170, no person may act to prevent the sale. The statute merely permits an action for damages if the sale by the executors results in a loss to the estate. NRS 148.170 was adopted verbatim from California Probate Code § 770. Authority reveals the determination to sell personal property as a depreciating asset, under such a private sale statute, presents a question of fact for the trial court if a party objects to the sale after it is made. In Re Atkins’ Estate, 8 P.2d 1052 (Cal.App. 1932); cf. In Re Sherman’s Estate, 297 P.2d 425 (Cal. 1956). Once such a sale is made, however, “title . . . passfes] without confirmation.” NRS 148.170. In any subsequent proceeding before the district court, “the executor, administrator, or special administrator is responsible [only] for the actual value of the property, . . .” (Emphasis added.) NRS 148.170; see also Goddard, 2 California Practice, Probate Court Practice, § 1021, 72-75 (3rd ed. 1977). Any right to file objections to. prevent a sale applies only to provisions where title passes upon confirmation by the court. See NRS 148.060(1); NRS 148.080; Goddard, cited above, § 1021, 72-75;2 § 1051, 108; Witkin, 7 Summary of California Law, Wills & Probate, § 470, 5904 (1974); compare In Re Depew’s Estate, 149 P.2d 890 (Cal.App. 1944), with In Re Williamson’s Estate, 310 P.2d 77 (Cal.App. 1957), [and] In Re Dargie’s Estate, 91 P.2d 126 (Cal. App. 1939). Thus, the district court lacked jurisdiction to set aside the sale under NRS 148.170 once the contract with *502A-Mark was executed on December 17, 1975, and equitable title passed.3
2. Nor can I agree with the majority’s conclusion that the standing of Rare Coin and Bowers to intervene was “irrelevant.” Other courts have long recognized “[o]nly persons in interest have any standing to invoke the aid of either a court of equity or the court of probate to set aside the sale of decedent’s property under a court order.” In Re Van Der Werf’s Estate, 53 N.W.2d 238, 239 (Iowa 1952). “Strangers or third persons having no interest in the estate cannot make any attack on the sale.” Ibid.; see also In Re Scholes’ Estate, 301 P.2d 172 (Wash. 1936). “Persons in interest” have thus far been held to be heirs, devisees, legatees, creditors, purchasers from the estate, or parties with any title or interest in the property being sold. See Van Der Werf, cited above; Scholes, cited above; In Re Pearson’s Estate, 33 P.451 (Cal. 1893); Collins v. Collins, 132 S.E. 389 (Ga. 1926). In Balaban v. Bank of Nevada, 86 Nev. 862, 867, 477 P.2d 860, 863 (1970) this court cited with approval both Van Der Werf and Scholes, and recognized that “an unsuccessful bidder is not a person interested in the estate,” and therefore lacks standing to object to a confirmation of sale requested under NRS 148.070.4
In my view the standing concept recognized in Balaban becomes more imperative when a private sale under NRS 148.170 is made, because the statute was designed to prevent delay and resultant damage to an estate if executors could not quickly sell certain types of personal property. Here, both Rare Coin and Bowers were coin dealers who had not even seen the collection before filing their petitions to prevent the sale. They never attempted to demonstrate any interest in the estate which would give them standing to set aside the A-Mark contract with the executrices, heir at law, and beneficiary. Thus, I liken their status to the unsuccessful bidder who lacked standing in Balaban.
Moreover, I cannot agree that the standing issue was rendered moot because of the court’s “sua sponte” action. As previously noted, the court lacked jurisdiction to proceed. The *503record also clearly demonstrates that the court’s actions were not suq sponte, but precipitated solely by the Rare Coin and Bowers petitions.
In this regard, it should be noted that the executrices, heir at law, and sole beneficiary, were clearly satisfied with the original A-Mark contract when it was executed on December 17. They wanted to complete the sale, and filed a motion in the district court to dismiss the Rare Coin and Bowers petitions. They reversed their position only after the contract was signed, and it became apparent a higher price could be obtained for the coins if the court set aside the contract. In similar situations other courts have estopped executors to change their position after they were responsible for procuring court action. See Consolidated Coppperstate Lines v. Frasher, 297 P.2d 692 (Cal.App. 1956); Bennett v. Bennett, 82 S.E.2d 653 (Ga. 1954); Cunningham v. Richardson, 122 P. 368 (Wash. 1912). I believe the parties in interest should be similarly estopped in the instant case.
3. Finally, I note the majority opinion opens the door for officious intermeddling by parties without an interest in the estate, and who stand to lose nothing by their interference. If A-Mark had not been successful at the second auction, and lost the coins to another bidder, it is apparent that A-Mark would also be denied recovery for damages caused by Rare Coin’s interference (i.e., for intentional interference with an existing contract), because the court acted in the “best interests” of the estate. I do not believe the legislature intended such a result. The rights of all the contracting parties must be given equal dignity. Contracts with an estate should not be regarded as obligations voidable at the pleasure of the probate court. To permit a court to set aside existing contracts merely because it would be in the “best interests” of the estate, ignores the “best interests” of those who deal with estates in good faith.

The order provided in pertinent part:
“3. That there is a grave danger of loss to the estate if a detailed description of the coin collection is disclosed to the public;
“4. That said coin collection constitutes personal property in the nature of ‘perishable property’ or ‘other personal property which will depreciate in value if not disposed of promptly or which will incur loss or expense by being kept’ as those terms are used in N.R.S. Section 148.170; and
“5. . . .
“IT IS HEREBY ORDERED, ADJUDGED AND DECREED that Nell J. Redfield, Luana W. Miles and Candida Larena, as Executrices of the Will of LaVere Redfield, deceased, be and they hereby are authorized to sell said coin collection pursuant to N.R.S. Section 148.170 to one or more buyers without the requirement of full disclosure, publication of notice and confirmation of sale in open court as required by N.R.S Section 148.190.”

“Sale of depreciating property is often a misunderstood proceeding. Frequently the administrator wants his order before he completes the sale. Technically this is not possible. The sale must have been completed before it is reported and all that the order does it to establish the amount which the representative is chargeable in his accounts by reason of the sale. Unless the report clearly states that the sale has been made, the court cannot make its order approving the sale price. There may be no valid reason why the representative may not have a private understanding with the buyer that as between them the sale not be considered binding until the order is issued. The danger of this practice lies in the difficulty of later saying that the sale was not completed. In one case where a sale of depreciating property was reported and later the identical property was sold as personal property and confirmed, the court held that the second sale was void as title had passed as a sale of depreciating property. (Citing Depew)
“The representative does not have to report the sale of depreciating property to make the sale effective. The only advantage of the order is to limit his responsibility to a fixed sum, the sale price.”

 No contention has been raised on appeal that the coins could not be sold as a depreciating asset. Therefore, I cannot agree with Justice Batjer that the court’s November 4 order was “void ab initio.” The executors clearly had the power to sell the coins under NRS 148.170 with or without the court’s authorization.

NRS 148.070 provides:
“Written objection: Hearing; proof of notice. Any person interested in the estate may file written objections to the confirmation of the sale and may be heard thereon, and may produce witnesses in support of his objections.. Before an order is made confirming a sale it must be proved to the satisfaction of the court that notice of the sale was given as prescribed by this Title, and the order of confirmation must show that such proof was made.” (Emphasis added.)