Richards v. Holmes. The record shows that Peyton S. Bethel, the then sheriff of the county of Dallas, did not file his oath as [* 143 ] assessor on or before the 10th of January, as required by law. He did file an oath on the 15th of March, but this was not a compliance with the law, and conferred no power on him to act as assessor. On the contrary, by his neglect to comply with the law, his office of sheriff became ipso facto vacated, and any assessment made by him in that year was void, and could not be the foundation for a legal sale. The neglect, also, to file his assessment and give immediate notice on the 25th of March, so that the purchaser might have his appeal at the next county court, was an irregularity which would have avoided the sale even if the assessment had been legally made. The statute makes the time within which these acts were to be performed material; and a strict and exact compliance with its requirements is a condition precedent to the vesting of any authority in the officer to sell. We are of opinion, therefore, that the sale of the land of the appellants was "contrary to law," and that the deed from Edward M. Harris, sheriff and collector of Dallas county, to William Overman, set forth and described in the pleadings and exhibits of this case, is void, and should be annulled. EDWARD C. RICHARDS and others, Appellants, v. SYLVANUS HOLMES and others, Appellees. 18 H. 143. SALES UNDER TRUST DEEDS. 1. Under the authority conferred by the deed of trust in this case, the trustee was authorized to sell for an installment of interest due and unpaid, though the principal sum was not due. 2. And this is so, though the deed did not show that any interest was due before the note became due, the note being referred to in the deed. 3. An authority to sell, after advertising the time and place of sale, authorizes the trustee, in the exercise of a sound discretion, to postpone the sale more that once, if due notice is given of the postponement. 4. The holder of the note secured by the deed may leave a bid with the auctioneer, and if it is the highest bid that can be obtained, his purchase will be valid. 5. A payee of a note may, without endorsing it, transfer it by a separate instrument, and his liability will be governed exclusively by the covenants of that instrument. APPEAL from the circuit court for the District of Columbia. Richards v. Holmes. Mr. Bibb, for appellants. Mr. Fendall and Mr. Tracy, for appellees. Mr. Bradley, for Southworth et al., assignees. [* 145] *Mr. Justice CURTIS delivered the opinion of the court. This is an appeal from a decree of the circuit court for the District of Columbia. The appellants filed their bill in that court to set aside a sale, made to satisfy a prior incumbrance on land, upon which they claimed to have a second incumbrance. In the court below, some question appears to have been made concerning the priority of the incumbrances; but none is made here, it being conceded, that though that claimed by the complainants was the earliest in date, the other was first recorded, and takes precedence. The sale in question was made under a deed of trust, whereby Holmes, the debtor, conveyed to the defendant, Philip R. Fendall, in trust to secure the payment of a promissory note, bearing date May 1, 1846, payable in two years from date, for $2,800 and interest, payable annually. It is objected that the sale, which was made on the 21st of October, 1847, after one year's interest had become due, but before the principal sum was payable, was premature. This depends upon the meaning and effect of the power of sale contained in the deed. It was competent for the parties to agree to a foreclosure by sale for non-payment of interest, and the question is, whether they did so agree. The event in which the trustee is empowered to sell, is thus described in the deed: "But if the herein before described promissory note, with the interest legally due thereon, shall not be fully paid off and discharged when said note shall be due and payable, and payment of the same shall be demanded, or if any note or notes given in substitution for or renewal of the herein before described promissory note shall not be fully paid off and discharged according to the tenor and effect of the said substitute or new note or notes, together with the interest legally due on such substitute or note or notes, so that any default be made in payment of any part of [146] * the aforesaid debt of two thousand eight hundred dollars and interest, then so soon after such default," &c. The omission to pay the first year's interest was a default within the express words of this power. That interest was part of the interest secured by the note, and a failure to pay it was a "default in payment of part of the aforesaid interest." The deed author Richards v. Holmes. izes the trustee to sell for any such default, and, consequently, the sale was not premature. It was argued that the trust deed does not describe the note as bearing annual interest, and, consequently, that the subsequent incumbrancer has a right to insist that, as against him, there was no power to sell for non-payment of such interest. It is true the deed does not purport to describe the interest which is to become due on the note; but it clearly shows that it bore interest at some rate, and payable at some time or times, and this was sufficient to put a subsequent incumbrancer on inquiry as to what the rate of interest and the time or times of its payment were. The deed, in effect, declares, and its record gives notice to subsequent purchasers, that its purpose is to secure the payment of such interest as has been reserved by the note; the amount, and date, and time of payment of which are mentioned. We do not think the mere omission to describe in the deed what that interest was to be, is a defect of which advantage can be taken by the complainants. The complainants further insist that the property was not duly advertised. The provision in the deed of trust upon this subject is as follows: "It shall be the duty of the said Philip R. Fendall or his heirs to enter upon the herein before conveyed piece or parcel of ground and appurtenances, and sell the same at public auction to the highest bidder, or at private sale, for cash or credit, according to his or their discretion, after having given public notice of such sale, by advertisement, at least thirty days previously thereto, in the National Intelligencer, or in some other newspaper printed or published in the city of Washington aforesaid.” Inasmuch as the trustee was empowered to sell at private sale, as well as at public auction, his power extended to a private sale made at any time after thirty days' notice. Having given notice for the space of thirty days that he was about to sell the property, he might, at any time after the expiration of that thirty days, have proceeded to sell it at private sale. But this notice should be such as to call for purchasers at private sale. The notice given was of a sale at public auction. This did not call for purchasers, except at the time and place mentioned in the notice. No sale was made at the time and place designated in the thirty days' notice published in the National Intelligencer. *At that time [147] and place the attendance of bidders was so small, that the trustee believed an attempt to sell for a fair price would be fruitless; and he adjourned the sale for the space of fourteen days, giving notice of such adjournment in the same newspaper of the next day. Richards v. Holmes. At the time and place thus fixed for the adjourned sale another postponement took place, for the same reasons, for one week; and the place of sale was changed from the premises to the rooms of the auctioneer. Of this postponement, also, public notice was given on the next day, in the same newspaper. There is no reason to suspect the least unfairness on the part of the trustee, or any one concerned. His conduct seems to have been dictated solely by an honest desire to obtain the best price for the property. Nor is there any ground for believing that either of these postponements prejudiced the interest of the complainants. They stand upon the objection, that though the trustee might have sold on the first day, of which thirty days' notice was given, he could not on that day adjourn the sale. But we consider that a power to a trustee to sell at public auction, after a certain public notice of the time and place of sale, includes the power regularly to adjourn the sale to a different time and place, when, in his discretion fairly exercised, it shall seem to him necessary to do so in order to obtain the fair auction price for the property. If he has not this power, the elements or many unexpected occurrences may prevent an attendance of bidders, and cause an inevitable sacrifice of the property. It is a power which every prudent owner would exercise in his own behalf under the circumstances supposed, and which he may well be presumed to intend to confer on another. This power of sale does not undertake to prescribe the particular manner of making the sale. It is to be at public auction, and "after 'having given public notice of such sale by advertisement at least thirty days;" but it assumes that the sale will be conducted as such sales are usually conducted. A sale regularly adjourned, so as to give notice to all persons present of the time and place to which it is adjourned, is, when made, in effect the sale of which previous public notice was given. The courts of several States have gone further in this direction than we find necessary, though we do not intend to intimate any doubt of the correctness of their decisions. They have held that a public officer, upon whom a power of sale is conferred by law, may adjourn an advertised public sale to a different time and place, for the purpose of obtaining a better price for the property. Tinkom v. Purdy, 5 Johns. 345; Russell v. Richards, 11 Maine, 371; Lantz v. Worthington, 4 Barr, 153; Warren v. Leland, 9 Mass. 265. If such a power is implied where the law, [148] acting in invitum, selects the officer, à fortiori it may be presumed to be granted to a trustee selected by the parties. * Richards v. Holmes. The remaining objection is, that the defendant Harper, the creditor for whose benefit the sale was made, through the trustee, requested the auctioneer to bid for him the sum of twenty-five hundred dollars; that the auctioneer did so, and there being no higher bid, the property was struck off to Harper. It is insisted that this renders the sale void. We do not deem it necessary to examine the numerous and somewhat conflicting decisions upon the subject of by-bidding, or bidding by persons standing in fiduciary capacities. This case stands clear of those decisions and of the principles upon which they rest. No decision lays down a positive rule that such sales, though affected by such bidding, are, per se, and as between all persons, void. They may be avoided by parties whose just interests have been injuriously affected by such misconduct, provided the rights of innocent third persons are not thereby disturbed. It was for the advantage of these complainants, as subsequent incumbrancers, that this property should sell for the best price which could be obtained. Even improper practices to enhance the price, if any such had been resorted to, could not be complained of by them. It is only some practice to prevent bidding, or procure a sale for less than the property would have otherwise brought, which can be relied on by them to avoid the sale. We have no doubt the creditor, for the satisfaction of whose debt the sale was made, had a right to compete fairly at the sale; but whether he had or not, his doing so could not be injurious to the complainants. It is true he employed the auctioneer to bid for him; but this fact alone could not depreciate the price. Such an authority may be used for fraudulent purposes; but, if fairly used, its tendency is to enhance the price; and in this case there is no evidence that it was intended to be, or in fact was, unfairly used. On the contrary, there seems to be no room for doubt that the price bid by the auctioneer for Harper was more than any other person was willing to give. It must be remembered, that the auctioneer was not employed as the agent of the creditor to purchase the property for him at the least price at which it could be obtained. Such an agency an auctioneer should not undertake. It is inconsistent with his relation to the seller, and with the faithful discharge of his duty to the seller. But an agency simply to bid a particular sum for a purchaser, amounting to no more than receiving from the purchaser, before the auction, a bid which is to be treated as if made there by the purchaser himself, is not necessarily inconsistent with any duty Vol. i-9 |