The opinion of the Court was delivered by
Mr. Acting Associate Justice J. Wm. Thurmond.
This action was instituted October 16, 1924, by Kemper Scott, against J. P., N. N., IT. F., A. B., & J. L. Newell, by the service of summons and complaint, and affects the title to thirty acres of land in.Williamsburg County.
October 31, 1921, E. A. Simmons executed a mortgage to the Federal Land Bank of Columbia, on two- tracts of land in Williamsburg County, one tract containing 39% acres, and the other containing 30 acres; subsequently, November 12, 1921, E. A. Simmons and D. H. Oliver executed and delivered to Kemper Scott four certain promissory notes, each in the sum of $1,280, aggregating $5,120, and as security therefor executed a mortgage on the 30-acre tract aforesaid; thereafter Kemper Scott transferred said notes and mortgage to Marion National Bank, which in April, 1923, foreclosed the mortgage; at the foreclosure sale Kemper Scott purchased the land and received a fee simple deed from the Clerk of Court thereto1, May 21, 1923; this deed was duly recorded in the office of the Clerk of Court for Williamsburg County, two days later. To the said foreclosure proceeding the Federal Land Bank was not made a party, and the 30-acre tract of land was sold subject to its prior lien. After the execution of the notes and mortgage by E. A. Simmons and D. H. Oliver, aforesaid, to Kemper Scott, E. A. Simmons was adjudged a bankrupt.
October 22, 1923, Kemper Scott entered into a contract to sell said tract of land to J. P. Newell for $3,000, and
gave J. L. or J. P. Newell bond for title, under which J. L-, or J. P. Newell went into possession of said 30 acres of land, the bond for title giving the name of the vendee as J. L. Newell in one place and J. P. Newell in another; and the note for $2,500, for the unpaid purchase money, is signed by J. L. Newell, a son of J. P'. Newell; and $500, the cash portion of the purchase price, was paid to Kemper Scott. The bond for title recognized that Kemper Scott’s title was not free of incumbrances and provided that the balance of $2,500, due Kemper Scott for said 30 acres of land, should be paid three years after the title to said parcel of land was straightened out (meaning cleared of the Federal Land Bank’s mortgage), certain interest to-be paid in the meantime, etc.
The 30-acre tract was the western part of a larger tract containing in the aggregate 69% acres, which two tracts were separated by the track of the Seaboard Air Line Railway Company.
In April, 1924, the Federal Land Bank of Columbia instituted suit through Lee & Shuler, its attorneys, at Kings-tree, S. C., for the foreclosure of the mortgage executed to it by E. A. Simmons of the two said tracts of land, and as Simmons was in bankruptcy his trustee was made a party, defendant; also’ Kemper Scott, who- had previously purchased the 30-acre tract of land, at the foreclosure sale commenced and prosecuted by the Marion National Bank, was made a party. J. L. Newell was also made a party defendant to said action commenced by the Federal Land Bank, and filed an answer by his attorney, N. N. Newell, setting up his contract of purchase of the 30-acre tract of land from Kemper Scott, and praying that his interest be protected.
The two said tracts of land under the decree of foreclosure in the case of the Federal Land Bank of Columbia against Kemper Scott and others were sold at Kingstree, on the first Monday in October, 1924, and both tracts were bid off by N. N. Newell, attorney, to wit; the 39%-acre
tract of land for $5,300, and the 30-acre tract of land for $500.
The decree of foreclosure required the successful bidder to deposit immediately with the Clerk of Court $500, which would be forfeited upon the bidder’s failure to comply with his bid. After the sale, N. N. Newell deposited with the Clerk of Court J. P. Newell’s check for $500. The balance of the bid was to be paid by the 10th of October. N. N. Newell had agreed to let Scott have his bid if he, Scott, complied with the terms thereof by the 10th of October. Scott failed to comply on said day. The attorneys for the land bank notified N. N. Newell accordingly, and the land was readvertised for sale.
After Kemper Scott had failed to comply with the terms of the bid N. N. Newell on-October 15, 1924, transferred his bid to the 39%-acre tract of land to Mrs. E. A. Simmons for $3,500 and a note to E. A. Simmons for $500, and transferred his bid to the 30-acre tract of land to A. B. and H. E. Newell, for $1,800 in cash arid discounted note of E. A. Simmons for $500; the amounts of the bids were paid at once to the Clerk of Court in compliance with the terms of the sale.
Mr. Kemper Scott appeared on October 15, 1924, at Kingstree, S. C., about four o’clock p. m., with a certified check for $5,300, the same day N. N. Newell transferred his bids, but at the time Scott appeared with a check, the transfers had been made by N. N. Newell, Attorney, the amounts of the bids paid, and deeds made by the Clerk of Court to the respective parties. Mr. Kemper Scott then instituted this action, alleging that N. N. Newell acted as his agent in his bids on the two parcels of land, and perpetrated a fraud on him by transferring the bids to other parties, and that they participated in the fraud.
The complaint demands :
“1. That the said deed to the 30-acre tract be set aside and annulled.
“2.
That the defendant N. N. Newell be ordered to transfer his bid to plaintiff, and the Clerk of Court be ordered to make deed for said 30-acre tract to plaintiff.
“3. For the costs and expenses of this action.
“4. Fo'r such other and further relief as plaintiff may be entitled to and as to justice and equity may appertain.”
Answer of J. P., N. N:, and J. P. Newell:
The answer of J. P., N. N., and J. P. Newell denies certain material allegations of the complaint and sets up that after the sale of said property, the said defendants met the plaintiff in the office of Pee & Shuler, and N. N. Newell agreed with plaintiff that if he would put up the amount of the bid by Friday, October 10th, he would transfer his bid to him, it being agreed that the plaintiff would give the defendant, J. P. Newell, a bond for title to the said 30-acre tract of land, at the price of $2,000, with the distinct understanding that it would be necessary that the sale be complied with by Friday noon, October 10th. The answer further states that N. N. Newell was notified on October 10th, through Messrs. Pee & Shuler, attorneys for the Federal Pand Bank, that the plaintiff had not complied with said agreement and the plaintiff failed to comply, so on October 15th, following, N. N. Newell with the consent of his client transferred to Mrs. E. A. Simmons his bid to the
39y2-
acre tract of land for $3,500 and $500, note of E. A. Simmons; and transferred his bid to the 30-acre tract of land to A. B., and H. F. Newell, for $1,800, in cash, and discounted a note of E. A. Simmons for $500, and immediately thereupon the full amount of said bid was paid to the Clerk of Court who executed deeds to the said parties.
Answer of A. B. and H. F. Newell:
“The defendants A. B. Newell and H. F. Newell, answering the amended complaint of plaintiff herein, allege:
“I. That they deny Paragraphs ‘XIV’ and ‘XV’ of the complaint herein;
“II. That they have not sufficient information to form a belief as to the truth of the allegations contained in the remaining paragraphs of said complaint, and therefore deny the same.
• “Further answering said complaint, and as a further defense thereto, these defendants allege:
“1. That subsequent to the date of the sale of the Simmons property, mentioned in the complaint herein, these defendants, acting in good faith, and for valuable consideration, purchased from N. N. Newell, attorney, his bid for the 30-acre tract of land described in the complaint herein, and thereafter complied with the terms of said bid by paying the amount thereof over to the Clerk of Court, who thereupon executed and delivered to them his deéd for said 30-acre tract of land; and that they are now the lawful owners thereof, and have no knowledge or information as to the matters and things alleged in the complaint regarding the transactions alleged to have been had between the other parties to this proceeding and the plaintiff herein.”
An order of reference was made by his Honor, John S. Wilson, August 29, 1925, directing Henry E. Davis, Esq., as special referee, to take the testimony in this cause and report his conclusions, both of fact and law, to the Court. Pursuant to said order of reference the referee took all the testimony which the parties to the action saw fit to offer, and decided the case in favor of the plaintiff.
The defendants served twenty exceptions to the Master’s report; but the Circuit Judge who heard the case overruled all the exceptions and concurred in the findings of the special referee in a decree dated October 20, 1926, and confirmed the referee’s report; then on November 2, 1926, his Honor made a supplemental decree, correcting an error in the original decree as to the time for the sale of the 30-acre tract of land.
The defendants appealed from the decree confirming the referee’s report to this Court, and served 23 exceptions.
These exceptions impute error to his Honor in confirming the special referee’s report in his conclusions of fact and law, and raise the following issues, to wit:
1. Was N. N. Newell acting as agent for Kemper Scott when he bid in the two parcels of land referred to in this case?
2. Did N. N. Newell intentionally and fraudulently mislead the respondent into believing that 'he represented him as agent in bidding in the two parcels of land?
3. After the sale of the two parcels of land, did N. N. Newell mislead Kemper Scott, or conceal from him any facts, or fraudulently adopt any means that deprived Kemper Scott of the opportunity to secure the bids of the said N. N. Newell?
4. Was the relation existing between the respondent and J. P. Newell such as would preclude J. P. Newell from bidding on said property in person, or by agent ?
5. Was there any relation existing between the respondent and A. B. and H. F. Newell, which would preclude the said Newells from taking a transfer of the bid of the 30-acre tract of land from N. N. Newell?
6. Could the respondent attack the official deed made to A. B. and H. F.'Newell, in this collateral proceeding, after the sale had been confirmed?
7. Would it be equitable and just to any or all of the defendants concerned, to allow Kemper Scott to come in and demand a deed to the 30-acre tract of land for $500, and require N. N. Newell to lose the difference between the price he paid for the 39%-acre tract of land, and the price he received for it, to wit, $1,300?
8. Did Kemper Scott lose the bids to the two parcels of land by his own lack of vigilance, and by his gross negligence in failing to comply with the bids as required by the terms of sale and the agreement between him and N. N. Newell?
A decree overruling or confirming a Master’s conelusion of fact in a law case, is as binding on the Supreme Court as the verdict of a jury.
United Timber Co. v. Mullins,
142 S. C., 477; 141 S. E., 15.
This principle does not apply to the case under consideration for it is a case in chancery, and if the concurrent findings of the referee and trial Judge are against the clear preponderance of the testimony, this Court has the power to review the findings.
Gibbes Machinery Co. v. Hamilton,
100 S. C., 59; 84 S. E., 296.
Issue 1
Agency involves a question of fact.
Hopkins v. Smathers,
114 S. C., 488; 104 S. E., 30.
The following excerpts from the testimony are material :
For the plaintiff: Witness Kemper Scott.
At folio 100 of the transcript of record he says—
“I turned to Mr. Newell and said will you bid it in? He give me to understand he would. After that Mr. Newell and Mr. Shuler talked together, but I could not understand, or hear all they said, nevertheless the impression was given to me that $5,300, would cover the entire costs. * * * ”
At folio 102:
“Q.
So when the bidding took place, the understanding you had with N. N. Newell was that he would run it to $5,300 if necessary, and thus clear the title to the thirty-acre tract? A. My understanding, yes, sir.”
At folio 103, Mr. Scott further says:
“He told me that he had bid in the property for me, and that it was necessary to put up a cashier’s check for $500.”
At folio 106A:
“After we had dinner and came back to the office Mr. N. N. Newell, Mr. Shuler and Mr. Lee, and I don’t know how many more, them three I saw, was back in the second room from the front entrance. I stayed in the first one — ■
don’t remember that anybody else was in the same room where I was. The door was closed between the three men I spoke of; Mr. N. N. Newell and Messrs. Lee & Shuler. They were in there probably twenty or thirty minutes. Finally Mr. Lee opened the door and beckoned to me, and I went in there. He said to me that I can hold this matter open until Friday next. I told him, ‘Mr. Lee, that gives me mighty short time; that it will be tomorrow night before I can get him and that makes it Wednesday before I can get to my attorney. It gives me short time, but I will do the best I can.’ And that was about the wind up of the conversation. I asked Mr. Newell to give me a statement of this so I could take it to Mr. Johnson, which he did.”
Copy of paper handed to Kemper Scott by N. N. Newall:
“Memorandum
“Send Cashier’s check, $4,800.00.
“Receipt for, $500.00.
“Settlement must be made by Friday noon, Oct. 10th.”
Folio 120:
“Q. What time of day did we get here? A. Some time along about four o’clock in the afternoon. I am not sure as to the exact’ minute, but some time along about that time.
“Q. So when you came here you went to the clerk’s office? A. Yes, sir.
“Referee: What date was that? Witness: Wednesday, October 15 th.
“Q. I went with you, did I ? A. Yes, sir.
“Q. And I don’t know whether you heard, but if you did tell what you heard? A. I heard you say that they had deed to the property. You were talking with the other people in the office, but I couldn’t understand any of your conversation. You and Mr. Newell were talking, I know.
“Q. You did learn that the property had been sold, that the Clerk of Court had made deeds to the thirty acres and to the other tract also to some of the Newells? A. Yes,
sir; I got sufficient of the conversation to understand that the property had already been deeded away — had already been sold.”
Folio 125:
“Q. Before the sale did Mr. N. N. Newell tell you that he would bid for you at the sale? A. He either said ‘yes’ or nodded affirmative — I don’t remember which.”
Folio 128:
“Q. Mr. Newell didn’t exactly agree that he would bid for you, did he? A. W'hy, I wouldn’t say, but he might have said ‘yes,’ or he might have affirmed by a nod — he would bid for me.
“Q. You had never seen Mr. Newell before that time? A. That was the first time I ever saw him in my life to know him.
“Q. Did you and Mr. Newell have any agreement as to how much you were to pay him? A. No, sir; nothing was said along that line.
“Q. Did you ask him after the sale how much you owed him? A. No, sir; we had not got to a final settlement.
“Q. Now, after dinner in Mr. Dee’s office, you understood that you had only complied to put up the money? A. That’s what Mr. Dee said.
“Q. Mr. Newell told you that you would have to have the money here by Friday? A. Mr. Newell and myself didn’t have any conversation. I don’t believe that we had any conversation at all — I don’t remember. There was very little talking done, and the talking was entirely between me and Mr. Dee after dinner.”
Folio 133 :
“Q. Didn’t at the same time and place, Mr. N. N. Newell tell you that he was representing his uncle at the sale ? A. I knew that.
“Q. Now, before you left Kingstree on the afternoon of the 6th of October, didn’t you tell Mr. N. N. Newell that
you couldn’t agree to anything until you saw your attorney?”
Folio 140:
“Q. After that, then, you told Mr. Newell you. would have to see your attorney first? A. That was before any sales took place. Newell and me had very little talk. I don’t believe we had any before the sale.”
Mr. E. D. Ard, attorney at law, testified as to a transaction between Kemper Scott and J. L. and J. P. Newell, relative to a note and bond for title involving the thirty-acre tract of land.
W. L. Eawrimore, among other things, testified (page 42 of the transcript) :
“Saw Kemper Scott at the sale walking around the courthouse; saw him after the sale talking with Mr. Newell. I heard Mr. Newell, referring to Mr. N. N. Newell, say you can still let Uncle Joe have the place. * * * ”
Page 43 :
“Drove out to see Mr. J. P. Newell, told him my business. He said, ‘Well, I don’t know whether Norval can sell that place or not. Him and Mr. Scott are mixed up on that place.’ And he further said, that Mr. Scott had been up there and didn’t have the $500 to put up as security, and he did not know what he was going to do. I told Mr. J. P. Newell that ‘if that was Mr. Scott’s bid I don’t believe you can sell. He says that the bid was in his name, and he could transfer it, and the Clerk of Court could give you a title.’ ”
Page 44:
“Mr. J. P. Newell said he had bid it in for Mr. Scott,” referring to Mr. N. N. Newell.
Witness Shuler — Page 45 :
“The land covered by the Scott mortgage was the 30-acre tract of the Simmons land lying on the west side of the Seaboard Air Dine Railroad. In following this matter further, I found that Mr. Scott had entered into a contract
of some kind with Mr. J.
L,:
Newell by which he was to convey to Mr. Newell the 30-acre tract for three thousand dollars. * * * ”
Page 47:
“Mr. Kemper Scott came in the office and I introduced him to Messrs. Newell. * * * I suggested that they should get together as to how to bid on the property. I then left them in the front room of our office, and closed the middle door, and I don’t know what their understanding was.”
Page 48:
“After the sale was over, Mr. Newell and Mr. Scott came to o.ur office, and we discussed the method of closing the sale. It was agreed that Mr. Scott would have in the hands of the Clerk of Court, or in our hands, I don’t recall which, the sum of fifty-three hundred dollars by Friday, of that week, that is by midday, and if he did not have that amount in our hands, or the hands of the Clerk of Court, by twelve o’clock on Friday of that week, it was understood that I would immediately notify Mr. Newell. I understood that Mr. Scott would either have a check sent, or would come and bring it, on that day. Mr. Scott did not come on Friday, and I immediately called Moncks Corner to notify Mr. Newell. This was done shortly after midday. N. N. Newell was notified that Scott had not complied with the bid. Newell came in the office on Friday afternoon, Saturday or Monday, and told me he was making an effort to obtain the money with which to close the sale. We were urging him to do his best. * * * It seems to me that the sale was closed on Wednesday, the 15th.”
Mr. Shuler further testified as to his effort to get the sale closed, and of receiving a telegram from Mr. Johnson, attorney for Scott, dated October 13th, and that he thought he communicated the contents of that telegram to N. N. Newell before the sale was consummated by the execution
of the deeds. The telegram stated that Scott would comply before Thursday, but he did not.
Page 56:
“Q. Do you recall whether you advertised the property the next week? A. I believe the notice was prepared and came out in one issue. In other words, my recollection is, trying to play safe with the bank.”
Page 58: Mr. D. H. Douglas testified that he took Scott over to J. P. Newell, and he had a talk with J. P. Newell’s sons, and corroborates what Scott says took place there.
Mr. J. A. Wilder testified, in substance, that he went with Kemper Scott to the sale, and heard no conversation between N. N. Newell and Scott until after the sale; and that five or ten minutes after the sale Newell spoke to Scott about putting up the $500 and Scott replied that he did not do any banking business over here, and applied to J. P. Newell for the money and J. P. Newell agreed to let him have it.
Mr. Jas. W. Johnson, attorney for Scott, at page 60,
et seq.,
gave a full history of the transaction as far as it was within his knowledge..
Defendant’s testimony;
Dr. E. A. Simmons, at page 67 of the transcript, testified as to negotiations between him and N. N. Newell for the sale to him of the 39% acres, and the closing of the transaction.
Mr. R. H. McElveen, at page 69 testified as to negotiations of J. P. and N. N. Newell to borrow money from Farmers’ & Merchants’ National Bank, at Lake City, in October, 1924.
N. N. Newell testified for himself, beginning at page 71, giving his version of the transaction in support of the allegations of his answer and a part of his testimony beginning at folio 298 reads as follows:
“
* * * We then went into Mr. Dee’s office and I told Mr. Dee what we were to do, and that I was to prepare
a new bond for title and send to Mr. Johnson to be executed by Scott, and he was to send the bond for title and the forty-eight hundred dollars and a receipt for five hundred dollars to Lee & Shuler by Friday, 12 o’clock, and Mr. Lee was to telephone me at 12 o’clock whether it had been done or not, and if it had I could run over here and transfer the bid. When we came out of Mr. Lee’s office—
“Q. Just a second, Mr. Newell if he did not have the money here, what were you fi> do? A. If he didn’t have the money here all his rights were forfeited, and he had no further rights therein. Mr. Scott asked me to mark down the amount that he must raise, and I tore off a little piece of scratch paper and wrote it down. This piece of paper has been offered in evidence. Mr. Lee had a stronger voice than I did, and I asked him to explain the matter fully to Mr. Scott, which he did in my presence, and it was thoroughly understood that Mr. Scott must be here by Friday, 12 o’clock, or everything would be off with him. My purpose was, that if Mr. Scott failed, then it would give us an opportunity to raise the money otherwise.”
Mr. K. L. Hirsch, at folio' 369, testified:
“A. I didn’t pay much attention. I notice three of them sitting there. I heard Mr. Newell say in a loud voice, T bid this property off for my uncle,’ and I recall that I met Mr. Newell on the' street and said ‘what were you and that old man doing, I thought you were going to fight,’ and he said ‘that old man is deaf.’ ”
Mr. J. D. Britton, Clerk of Court, at folio 372, testified:
“Q. Did you discuss with Mr. Newell anything at that time with reference to the Simmons property? Attorneys for plaintiff: We object.
“Q. Did he at that time say who he was going to bid the property in for if it didn’t go above a certain amount? A. Yes, sir.
“Q. And did he say who he was going to' bid it in for ? A. He said he was going to bid the property for, I think he
said, Uncle Joe, if it didn’t go above a certain amount.”
Mr. N. N. Newell, recalled, testified as follows (folio 375) :
“Q. Mr. Newell, when you closed this transaction on the 15th of October, did you at that time know that Mr. Scott was claiming any interest in the property you bid ? A. No, sir.
“Q. In transferring these bids as you did, was that in accordance with your client, Mr. J. P. Newell’s wishes in the matter? A. It was agreeable with him.”
Mr. LeRoy Lee, at folio 380
et seq.,
testified:
“I remember distinctly saying to Mr. Scott that he must have the money in our office, I think, by midday on Friday, and I think the amount was fifty-three- hundred dollars. Now, according to my recollection, if he didn’t have that, we were to notify Mr. Newell — that’s the sum and substance of the understanding so far as I recall it.
“Q. Do you know why you were to notify Mr. Newell? A. We were to notify him so that Mr. Newell could go on and get the money and comply with the purchase.”
On page 96 of the transcript is fully explained the arrangement that he and N. N. Newell had relative to the bidding on said lands:
“A.
Yes, sir, I remember having to speak very loud to him and put my mouth close to his ear — I know Mr. Scott remembers that, too. I have that distinct recollection.
“Q. Would you say that Mr. Scott understood fully that he had to have this money here by twelve o’clock noon on Friday, else someone else, Mr. Newell, would make other arrangements ? A. I will say this: Mr. Scott — I am speaking about my understanding, I can’t say what his was —I will say that Mr. Scott was advised that if he did not have that money here by that time we would notify Mr. Newell, and Mr. Newell would go ahead and close the thing, I will say that.”
There are twenty-three exhibits in evidence, and while they slightly elucidate the transaction, the principal evidence that has influenced the Court is the parol.testimony of Scott, N. N. Newell and other witnesses, and the conduct of Scott and N. N. Newell after the land was bid in by Newell.
Kemper Scott was not only hard of hearing, but very hard of hearing, and it was so easy for him to misunderstand N. N., Newell; in fact was not definite and certain in his testimony that N. N. Newell was to bid in the land for him, but testified that he understood that N. N. Newell was to bid it in for him. He also testified that he knew that N. N. Newell was attorney for J. P. Newell.
We think that the conclusion of the referee that N. N. Newell bid in the land as the agent for Kemper Scott was against a clear preponderance of the testimony, and that the chancellor erred in not sustaining the exceptions to the findings and conclusions of the referee on said issue of agency.
Mr. EeRoy Tee was positive in his testimony that he gave Scott notice that he must have the money for the land in his office by midday on Friday following, which was October 10th.
The memorandum given Scott by Newell was definite and was without ambiguity.
When is a transaction fraudulent? Issues '2 and 3 are very similar, and will be considered together.
“Fraud is where one deceives another and causes him to do something which he would not otherwise have done by misrepresenting a fact, by making a false statement, or by failing to speak when equity and good conscience require one to speak.”
Sloan v. Lee et al.,
121 S. C., 429; 114 S. E., 408.
The suppression of the truth, with misleading suggestions, may be as effective to create an erroneous or false impression as a direct falsehood.
Welborn v.
Cobb, 92 S. C., 393; 75 S. E., 691.
“When a promise is made with no intention of performance, and for the very purpose of accomplishing a fraud, it is a most apt and effectual means to that end, and the victim has a remedy by action or defense.”
Palmetto B. & Trust Co. v. Grimsley et al.,
134 S. C., 493; 133 S. E., 437; 51 A. L. R., 42.
Fraud is a state of mind dependent on intent which is provable by circumstantial evidence.
Parham v. Insurance Co.,
111 S. C., 37; 96 S. E., 697.
In
Donaldson v. Temple,
96 S. C., 242; 80 S. E., 438, it is held:
“Whether the fraud be alleged in the declaration, complaint or bill, or set up' by way of defense in pleas, answer or replication, it is essential that the facts and circumstances which constitute it should be set out clearly, concisely and with sufficient particularity to apprise the opposite party of what he is called upon to answer.
State v. Jaques,
65 S. C., 184; 43 S. E., 515.
Gem Chemical Co. v. Youngblood,
58 S. C., 56; 36 S. E., 437.
In
Coleman v. Stevens,
124 S. C., 8; 117 S. E., 305, this Court held:
Syl. 3. “An instruction that deceit or fraudulent representations to be actionable must relate to existing or past facts, and the failure to perform a promise does not in and of itself constitute fraud, or evidence of fraud, held not error as being a charge on the facts, in view of the other instructions.”
Syl. 4.
“A
mere violation of a contract will not support an allegation of fraud.”
Where one acts within his legal rights fraud will not be implied.
Tolbert v. Roark,
126 S. C., 207; 119 S. E., 571.
If testimony is indefinite, and not positive and clear, fraud should not be inferred.
Talbert v. Talbert, 97
S. C. 136; 81 S. E., 644.
Both constructive and actual fraud are charged in this case. This complaint attacks N. N. Newell and others for fraud — it attacks their characters, their souls.
The testimony in the case is far insufficient to show fraud on the part of N. N. Newell or the other defendants.
How can it be concluded that N. N. Newell intended to mislead Kemper Scott, in the light of the admitted testimony, that after N. N. Newell had bid in the parcels of land, he agreed to transfer his bid to Scott, if Scott would comply with the terms of sale? Mr. Lee, the attorney for the Federal Land Bank of Columbia, says this, and Scott admits it; the memorandum given Scott by N. N. Newell corroborates it. Before this testimony any possible bad motive and all scienter vanish on the part of N. N. Newell.
The charge of fraud is a very serious charge, and to sustain it the proof should be complete. There is no evidence of fraud in this case; no inference from the acts and conduct of N. N. Newell, and other defendants, can be construed as fraudulent; hence, the Chancellor erred in failing to sustain the exceptions to the Referee’s report on those issues.
Issue 4
It appears that Kemper Scott had given bond for title to J. L. Newell; but the plaintiff contends that J. P. Newell was the purchaser of the land; however, this Court does not think the investigation of that matter is within the scope of the pleadings. There would be no reformation of the bond for title without consent of the parties, and if J. P. Newell imposed upon Kemper Scott in the transaction, or if there was mutual mistake of fact, such issue, or issues must be settled in some other case. If, however, the relation of vendor and vendee as to the 30-acre tract of land existed between Kemper Scott and J. P. Newell, this relation could not preclude Newell from bidding at the mortgagee’s sale.
Kemper Scott was a party to that foreclosure proceeding; under the decree any person had the right to bid at that sale; and as that sale extinguished all right and title that Kemper Scott had in the 30-acre tract of land and an eviction of Newell holding under Scott must of a necessity follow. Newell, for 'his own protection when his vendor’s title was being extinguished, certainly had the right to purchase at said mortgagee’s sale.
Barnes v. Lyles,
110 S. C., 465; 96 S. E., 723.
Anderson v. Butler,
31 S. C., 183; 9 S. E., 797; 5 L. R. A., 166. In
Wilson v. Carr et al.,
141 S. C., 60; 139 S. E., 171, this Court held:
“A
purchaser should be allowed to secure such a title as in reason he intends to secure, unless there should be a palpable failure on his part to exercise ordinary care to protect himself.”
The principle announced in
Bradley v. Calhoun,
125 S. C., 70; 117 S. E., 811, is not applicable to the facts of this case.
The principle is laid down in
Williams v. Bruton et al.,
121 S. C., 31, Syl., 5; 113 S. E., 319, “Where cotenants held under the same title, one cannot, without the consent of the others, buy in an adverse claim or title and assert it for his exclusive benefit against the others.” But that principle cannot avail respondent in this case.
The consideration of this issue was really disposed of in the consideration of issue 1, but as the point was made we have considered it.
Issue 5
There is nothing in the record that can possibly be construed as precluding A. B. and H. E. Newell from purchasing the bid from N. N. Newell, attorney, on the 30-acre parcel of land.
Issue 6
The question is raised whether the.respondent could attack the official deed made to A. B. and H. F. Newell, by the Clerk of the Court, after the sale had
been confirmed, in the form of the action in this case.
There are three ways of attacking a judgment: (a) Collaterally; (b) directly; (c) action on the equity side of the Court.
A judgment may be attacked collaterally only when its defects and infirmities are apparent by an inspection of it.
Findley v. Robertson,
17 S. C., 435.
Tederall v. Bouknight, 25 S.
C., 275.
Turner v. Malone,
24 S. C., 398.
A direct attack is made by motion on notice in the same case with the same parties.
Crocker v. Allen,
34 S. C., 452; 13 S. E., 650; 27 Am. St. Rep., 831. In the case of
New York Life Ins. Co. v. Mobley,
90 S. C., 552, Syl. 2; 73 S. E., 1032, this Court held:
“A
jurisdictional defect, which does not appear upon an inspection of the record, does not render the judgment void, but only voidable, and any proceeding to have the judgment declared a nullity, other than a motion in a cause, must be regarded as a collateral attack on the judgment.”
In
Patterson v. B. & A. Mortgage Co.,
112 S. C., 210; 99 S. E., 830, this Court held:
“It is undoubtedly the policy of the law to maintain judicial sales, whenever it can be done without violating principles or doing injustice; and in this view it is held that a purchaser at such sale is in no way responsible for mere irregularities in the proceedings, or even error in the judgment, under which the sale is made.”
The relief sought in this case is to set aside the deed made to; A. B. and H. E. Newell, and to set aside the order confirming the sale, and the confirmation provided by No. 84, Act of 1923, and to have a deed made to plaintiff.
An attack on a judgment, or order, on the equity side of the Court, upon equitable grounds, is recognized in the following cases:
Crocker v. Allen, supra,
page 461 (13 S. E., 650).
Ruff v. Elkin,
40 S. C., 69; 18 S. E., 220.
Life Insurance Co. v. Mobley,
90 S. C., 561; 73 S. E., 1032.
Tolbert v. Roark,
126 S. C., 218; 119 S. E., 571; 15 R. C.
L., 730, Par. 182.
Sloan v.
Hunter, 56 S. C., 385; 34 S. E., 658, 879; 76 Am. St. Rep., 551.
An attack on the deed of the Clerk of Court and confirmation of the sale, and for an order requiring the Clerk of Court to convey the land to the plaintiff, by motion on notice to set aside the deed and confirmation of sale, would not have been an appropriate remedy in this case.
The form of the proceeding in this case is correct, and the cases of:
Coogler v. Crosby,
89 S. C., 508; 72 S. E., 149.
Barnes et al. v. Leevy et al.,
112 S. C., 426; 100 S. E., 169.
Baker v. Brewer,
129 S. C., 74; 123 S. E., 771, are not in point; hence, all exceptions to the form of the proceeding herein are overruled; but the plaintiff failed to establish his cause of action.
Issue 7
The testimony shows that N. N. Newell, attorney, agreed to transfer his bid on the two parcels of land to Kemper Scott, provided Scott complied with the terms of sale, but this he failed to do.
The larger parcel of land above described seems to have sold for its full value, and the 30-acre tract desired by Scott for very much less than its real value.
He that seeks equity must do equity.
Would it be right and just to let Kemper Scott have the smaller tract of land for one-fourth its value, and thereby entail upon N. N. Newell a loss of around $1,300, in the transaction ?
Scott’s action is relative only to' the smaller tract of land, and does not seek to acquire both tracts upon the terms of sale and agreement made with N. N. Newell, attorney. Equity cannot countenance the relief demanded by Scott in this case.
Issue 8
Scott had ample opportunity to comply with the terms of sale of the two parcels of land, and acquire the bids of N. N. Newell, attorney, but he did not seize
this opportunity, and although he had notice from N. N. Newell and from Mr. Le Roy Lee that he must comply with the terms of sale by the following Friday, October 10th, he neglected to do so until October 15th, about 4 o’clock in the afternoon, after the land had been advertised for sale, and after N. N. Newell, attorney, had transferred his bids in the morning of that day. Scott has only himself to censure for his failure to acquire the bids to' the said parcels of land.
It is held in the case of
Colt v.
Britt, 129 S. C., 226; 123 S. E., 845, substantially, that recklessness óf a plaintiff in a transaction may be set up as a defense by the defendant for fraud perpetrated by him on the plaintiff in such transaction. Every person, notwithstanding a wrong committed upon him by some other person, must exercise reasonable prudence and diligence in the premises for his own protection. In this case Scott was guilty of recklessness in his failure to comply with the terms of sale and the agreement N. N. Ne-well had with him, and this recklessness was the proximate cause of his loss of said bids; and he cannot now blame Ni N. Newell for his own fault.
For the reasons aforesaid, the judgment of the lower Court is revtersed, and the complaint in this action dismissed!.
Messrs. Justices Beease and StabeEr concur.
Messrs. Justices Cothran and Carter dissent.