Cottingham v. Moore

128 Ala. 209

Opinions

DOWDELL, J.

Eleanor Coker died April 28th, 1876, leaving a last will and testament which was duly probated in the probate court of Bibb county. By this will she devised and bequeathed all of her estate, consisting of real and personal property, subject to the payment of her debts, to her niece Martha Ann Moore and Robert Benning Moore, husband of said Martha, “and the heirs of 'their body.” The clauses, in the will occurring subsequent to the one containing the above devise and bequest clearly manifest the purpose and intention of the testatrix to create in the said Martha Ann a life estate with remainder to her children, and it is upon this construction of the will that the present bill is filed. Robert Benning Moore, the said husband, was made executor, but failed to qualify as such. The respondent Cotting'ham took out letters, of administration cúm testamento annex, and entered upon the duties of his office. This was in 1876 and shortly after the probate of the will. In January, 1877, the land, the subject matter of this controversy, was sold under the decree of the probate court for the purpose of paying the debts of the sai'4 estate,

It is admitted by the bill that the proceedings had in the probate court for the sale of ¡the land were regular on their face; but it is charged ¡that the probate court was imposed upon by the administrator by false statements contained in his petition for the sale of said land, in Iris averments as to the existence of debts against the estate and as to the insufficiency of personal property for the payments of debts, and that in this respect the administrator was guilty of actual fraud upon the rights of complainant. It is also charged 'in the bill, that the administrator became the purchaser at the sale, buying through an intermediary. The life tenant, Martha Ann Moore, died in June, 1895, and tire bill was filed in May, 1897. The prayer for relief is in alternative — tf the complainant be mistaken in their charges of actual fraud by the administrator in procuring the sale of said land, then they ask to disaffirm the sale and have an accounting, offering on their part to do equity.” On a final submission of ¡the cause on the pleadings and proof, it was determined by the decree of the chancery court that there was no fraud committed by the administrator in the proceedings before the probate court for the sale of the land, but relief was decreed complainants under the alternative prayer of the bill and an accounting was had. From this decree the respondent Cottingham prosecutes, his appeal to this court.

Under the view which we take of the case as presented by the record, we think it unnecessary to notice those questions discussed by counsel growing out of the accounting had under ¡the decree. We may here make the passing observation, that as to the clause of the will, which provides that in the event of the death of Martha Ann Moore the property devised and bequeathed should remain in the hands of Robert Benning Moore, until the children of Martha Ann became of age, and then to be divided among them, that it is unimportant under our view of and for the purposes of the case as now 'presented, to determine the nature or character of trust created in said Robert Benning Moore, We think the proof amply sustain,3 the chancellor in holding that there was no fraud practiced by the administrator in procuring a sale of the land for the payment, of the debts of the estate. The great weight of the evidence, by disinterested witnesses, shows that the purchase price bid and paid for the land was its highest market value. The fact is also shown, that, the administrator was a judgment creditor of the testatrix, with an execution lien on the land in question. The amount of this judgment with interest was something over $200. There were also other creditors, of the estate. The price bid and paid for the land was four hundred dollars. We have then a case, as presented by the record, of a bill filed by the remaindermen after the termination of the life estate, against the administrator, who is a judgment creditor with an execution lien on the land sold, buying at the administrator’s sale made under the decree of the probate court for the payment of debts of the estate, without any just imputation under the facts of fraud or unfairness in the sale and purchase, praying a disaffirmance of the sale and for an accounting.

No principle of equity is more firmly engrafted on the jurisprudence of this country than that a purchase by a trustee for his own benefit at a sale of the trust property, is voidable at the option of the cestui que trust, and will be set aside on timely application made for that purpose. And in the application of this rule it is unimportant whether the purchase be made directly or indirectly, in person, or through an intermediary who subsequently reconveys to the trustee, and without regard to the question of fairness in the purchase. This doctrine is too familiar to call for citation of authorities. Such sales, however, are not per se void, but only voidable at the option of the beneficiary or cestui que trust, when seasonably expressed, though in some adjudged eases there may be found loose expressions to the effect that the purchases of trustees are void, or that a trustee cannot purchase at his own sale. See Charles v. Dubose, 29 Ala. 367; Calloway v. Gilmer, 36 Ala. 354; and authorities cited in those cases. But this salutary doctrine, not the creation of legislation, but-' of a zealous care of the courts for the rights and interests of those standing in confidential relations, is not without limitation when applied to executors and administrators who have a.n interest in the property sold. As was said in Calloway v. Gilmer, supra: “To this eminently wise and conservative principle, the previous decisions of this court require .us to recognize a single exception — that is, that such executors and administrators as have an interest in the property sold, may purchase at a sale of the goods of the estate, provided there is no unfairness, and the property is exposed to sale in the ordinary mode, and under such circumstances as will comand the 'best price;” citing Brannon v. Oliver, 2 Stewart, 47; Saltmarsh v. Beene, 4 Port. 283; McLane v. Spence, 6 Ala. 894; Julian v. Reynolds, 8 Ala. 680, 683; McCartney v. Calhoun, 17 Ala. 301; Andrews v. Hobson, 23 Ala. 235, 236; Montgomery v. Givhan, 24 Ala. 579; Charles v. Dubose, 29 Ala. 371. While in McCartney v. Calhoun, supra, Andrews v. Hobson, supra, and Montgomery v. Givhan, supra, there may be found expressions of regret at the existence of this exception, yet the rule as laid down in Brannon v. Oliver, supra, and limited in Saltmarsh v. Beene, supra, and McLane v. Spence, supra, had been adhered to by this court. No attempt has been made to answer the forceful reasoning employed in the case of Brannon v. Oliver. And in addition to what was there said, it might be added that under our law in sales by an administrator under the decree of the court, the court 'and not the administrator, is the real vendor, and such sales must be made at public auction, and receive the judicial sanction of the court before any title can pass to the purchaser. But in what we have here said, we do not wish to be understood as intimating any intention of extending the exception to the rule in cases of administrators and executors purchasing at their sales, further than such as have an interest. The requirements of the case we have in hand do not call for any extension. The vital and material inquiry here is as to what character of interest will bring the administrator within the exception. In the case of Brannon v. Oliver, supra, the character of the interest of the administrator was ¡that of an heir or distributee of the estate. In the case of Andrews v. Hobson, the character of interest was that of creditor. But in the latter case it was held that Hobson could not come within the exception under consideration, not being an executor or administrator, but a trustee under a dejed. No distinction, however, was made in the opinion of the court, as to the character of interest, between that of heir and that of creditor. In Montgomery v. Givhan, while the executor was a son of the testator, the character of interest under consideration was that of creditor; the purchase, however, in this case, was not upheld because of a want of fairness in the transaction. No distinction was drawn as to the nature of the interest requisite to bring the executor or administrator within the exception. Although the administrator who is a creditor may have no estate or title in the land sold for the payment of debts, still, it cannot be asserted that he is without interest in the property sold, being a judgment creditor of the testator or intestate with an execution lien upon the very property that is sold. In the case of Calloway v. Gilmer, supra, it was urged in argument by counsel that the right to purchase by executors or administrators having an interest in the property sold, should be limited and confined to purchases at sales of personal property, but the court declined to assent to that view.

Under the facts of this case, the proceedings in the probate court for the sale of the land being regular, and the administrator having an interest as a judgment creditor with an execution lien on the property sold, the price bid .and paid being the full market value of the land, and the sale being free from any unfairness, the sale should not be set aside. The decree of ¡the chancellor must be reversed on the appeal of M. L. Cottingham, and a decree will be here rendered dismissing complainants’ bill. The cross-appeal of John H. Moore et al. is affirmed.