Court Opinion

ID: 6821206
Source: CourtListenerOpinion
Date Created: 2022-07-23 19:07:22.236854+00
Date Added: 2024-06-11T16:04:08.143694
License: Public Domain

Hudgins, J.,
dissenting.
The dominant question presented in this record is whether the owners or the highest bidder at the auction sale is entitled to the difference between $17,900, the amount of the bid, and $30,000, the market value of the property ascertained between the date of the auction and the date the sale was asked to be confirmed.
The majority opinion emphasizes the efforts of this court to stabilize judicial sales. This is important, but the primary object of a judicial sale is to obtain the highest price for the property consistent with the rights of all parties concerned. The highest bidder at a judicial sale only becomes a party to the suit when the property is cried out to him at his bid. The fact that he makes the last and highest offer for the property does not complete the contract of sale. This contract is not completed until the offer is accepted and confirmed by the court. There is a distinction in such bidder’s rights before and after confirmation of the sale.
This distinction is pointed out with force in the com*853paratively recent case of O. K. Warehouse v. West, 151 Va. 809, 145 S. E. 253, in which the following excerpts from Berlin v. Melhorn, 75 Va. 639, are quoted with approval:
“ ‘We think it may be safely laid down, as a general rule, deducible from the authorities, that after a judicial sale has been absolutely confirmed by the court which ordered it, it will not be set aside except for fraud, mistake, surprise, or other cause for which equity would give like relief, if the sale had been made by the parties in interest, instead of by the court. But where the objection is to the confirmation, the rule is more liberal.
“ ‘The principles applicable to such cases have been affirmed by several recent decisions of this court. In the opinion of the court by Judge Staples, in Brock v. Rice and others, 27 Gratt. (68 Va.) 812, it is said that a decree is a judgment of the court which determines the rights of the parties. Such a decree possesses the same force and effect of any other adjudication by a court of competent jurisdiction. But before confirmation the whole proceeding is in fieri, and under the control of the court, until then, the accepted bidder is not regarded as a purchaser. His contract is incomplete and he acquires no independent right to have it perfected. * * * Whether the court will confirm the sale must, in a great measure, depend upon the circumstances of each particular case. It is difficult to lay down any rule applicable to all cases, nor is it possible to specify all the grounds which will justify the court in withholding its approval * * * .
“ ‘The court, however, in acting upon a report of sale, does not exercise an arbitrary, but a sound legal, discretion, in view of all the circumstances. It is exercised in the interest of fairness, prudence and with a just regard to the rights of all concerned.’ ”
The court then stated:
“Examination of the decided cases will reveal that gross inadequacy of price is practically the chief, certainly the most frequent, ground which will justify the court in refusing to confirm the sale of the real estate made by its re*854ceiver or commissioner. Shultz v. Hughson, 134 Va. 497, 114 S. E. 591; Walker v. Smith, 144 Va. 824, 130 S. E. 768.”
The rights of infants and the rights of a soldier in service are involved. All the owners, and the commissioners who reported the sale, asked that the offer of $17,900 made at the auction be rejected and that the property be re-offered for sale. • The peculiar facts and circumstances which bring this case within the exception to the general rule are as follows:
For eleven years immediately preceding the sale, the property had been used as a produce house operated by a concern which bought and sold poultry and eggs in large quantities. The building is peculiarly adapted to this business. Local real estate dealers and others fixed the market value of the property between $14,000 and $16,000. This valuation was based on its then annual rental, its location and other local conditions. The commissioners, basing their recommendation on these known facts, stated in their report that the bid of $17,900, submitted by William G. Stroh and Simon J. Lapof at the auction on June 26, 1943, was a good offer and recommended that 'the sale be confirmed. Subsequently, when the sale of the property became generally known to people engaged in the produce business, it was ascertained that the value of this particular class of property had been greatly enhanced to the wholesale poultry trade because of conditions created by the war. Indeed, it is said by one witness that, due to these conditions,- Harrison-burg has become “The Poultry Capitol of the East.” Nathan Schweitzer, a resident of New York City engaged in the poultry business, heard of the sale and immediately came to Harrisonburg, viewed the property and filed an upset bid in the sum of $23,000. As evidence of his good faith, he filed a certified check for $8,000. He prayed that the bidding be reopened and started at his offer of $23,000. As soon as this was done, the commissioners investigated the conditions and ascertained that the market value of this property to persons engaged in the produce business was from $25,000 ■to $30,000. A witness stated that one of the purchasers told *855him before sale that he expected to run the property up to $30,000 rather than miss buying it. Upon ascertaining these facts, the commissioners changed their opinion and requested the .court, as heretofore stated, not to confirm the sale. Each and every one of the many owners joined in this request. If the bid is not rejected, the owners of the property will lose at least $12,100, which sum will inure to the benefit of the highest bidder on June 26, 1943.
It seems, to me that these peculiar facts, which were unknown to the general public until after June 26, 1943, are sufficient to justify the rejection of the original bid and the resale of the property, the bidding to begin at the sum of $23,000. If- this is not done, the efforts of the court to “stabilize judicial sales” will result in the sale of property at a sacrifice and a substantial loss to the true owners of the land.