Opinion
03-26-1891
HEALD v. JARDINE et al.
B. Wayne Parker, for complainant. Theofore Runyon, for defendants.
B. Wayne Parker, for complainant.
Theofore Runyon, for defendants.
BIRD, V. C. The defendants were the holders of a mortgage on certain real estate adjoining the Kill von Kull, given by one Moore to secure the payment of $5,000. They filed their bill to foreclose said mortgage, and obtained a decree fixing the amount due thereon at $5,539.16, and ordering a sale. Execution was issued thereon, and the property advertised for sale, on the 16th day of July, 1890. Before such final decree Heald became the purchaser of the equity of redemption. While the advertisement of the sale was running, he employed a solictor, Mr. Savage, to procure for him a sale of the land in parcels; and for that purpose the solicitor applied to the counsel of the complainants, who, after consulting with their clients, refused to consent to offer the property in parcels. It was understood between the counsel of the respective parties that under the law it was the right of Heald to apply to the court to have the land sold in parcels. I am not clear in my mind just how long it was before the day of sale that his interview took place, but it was a very short period of time. However, the testimony leads me to the conclusion that Mr. Savage attended at the time and place fixed by the sheriff for the sale with the intention of asking for an adjournment with the view of procuring an order from the court directing the sale of the land in parcels, and that Mr. Schaeffer, counsel for the Jardines, expected him to make such application. The counsel and Thomas and Vreeland Jardine met at such time and place. Mr. Schaeffer says: "Mr. Savage spoke to me, and said to me: 'If Tom and Vreeland will agree or consent to give us an option of a right to purchase these lands within thirty days of the day of sale upon our paying the amount of the decree, costs, and sheriff's fees, why, I won't ask for an adjournment; I will let the thing go on.' I said to him that Ithought they would do so; but still I would see them, and speak about it. I saw them, and made known to them the proposition. We came in again, and I put them immmediately in communication with Mr. Savage, who made the same proposition to them, and the proposition was accepted." Mr. Savage says that Mr. Schaeffer opposed an adjournment because it would put him to the necessity of coming to the place of the sale again, which, because of his having been sick for some time, would greatly inconvenience him, and also because an adjournment would increase costs. He adds: "Mr. Schaeffer then suggested that, instead of adjourning the sale, and putting all hands to the expense of bringing him up to New Brunswick again in his weak and feeble condition, they would sell the property, and buy it in for a less sum, to save sheriff's execution fees; and that they would give my client the right to redeem that property for the amount due upon their decree any time within thirty days. That was the subject of a good deal of discussion. It was not agreed to at once. Tom and Vreeland Jardine were both consulted, and agreed to the proposition. I agreed to it." This shows conclusively that the owner of the equity of redemption was, in equity, to stand in the same relation to the mortgagees, who were complainants in that suit, that be did when he first took title to such equity of redemption. He then had the right to redeem, and by virtue of this agreement he had that same right at any time within 30 days after the sale, as clearly and as perfectly as though no decree had been made. The difference in the phraseology used by Mr. Savage and Mr. Schaeffer to express the terms of the agreement (the one saying that his client should be permitted to redeem, and the other saying that he should have the option to purchase the lands within 30 days) can make no possible difference. The amount of money to be paid in order to redeem or repurchase was the whole amount of principal, interest, and costs due to the Jardines; and, if I understand the spirit of the testimony and the argument of the learned counsel for the Jardines, the contrary was not seriously pressed. Acting in accordance with the spirit of this agreement, the sheriff was ordered to offer the property for sale. Mr. Schaeffer made one bid of $4,000, and the property was struck off to Thomas Jardine. It was agreed that the deed should be made to him alone, because it would be less trouble to make title through him alone, since his sister was at that time in Europe. That a party standing in the relation to another as Heald stands to these defendants is favored in equity is abundantly sustained by the following cases, in which deeds absolute upon their face were held to be mortgages, and the grantors permitted to redeem. Budd v. Van Orden, 33 N. J. Eq. 143; Sweet v. Parker, 22 N. J. Eq.453; Crane v. Decamp, 21 N. J. Eq. 414, —and more especially where there has been an agreement between the owner of the equity of redemption, whose equity has been foreclosed by a decree upon which an execution has issued, and the mortgaged premises advertised for sale, and the complainant, that the complainant will purchase such property at the sale, and permit the owner of the equity to redeem by paying the whole amount due, as appears by the following cases: Marlatt v. Warwick, 18 N. J. Eq. 108, 19 N. J. Eq. 439; Combs v. Little, 4 N. J. Eq. 310, 40 Amer. Dec. 207. In the note to the last reference it is held that, where a sale is made under the conditions above expressed, the relations of trustee and cestui que trust are created; citing numerous authorities in support of the proposition. Turner v. King, 2 Ired. Eq. 132. Not to enforce this rule in this case would be giving support to legal fraud; for it was agreed between the parties, but not in writing, that the complainants in the foreclosure suit should purchase the property at their own price, without the agent of the owner of the equity asking for an adjournment in order that he might have the property sold in parcels, and also without his bidding. The property was sold to them, or one of them, for $4,000. The right to redeem was given to the defendant upon his payment of the whole amount due upon their claims of principal, interest, and costs, being $5,539.16, together with execution fees. "While the auction was running, Vreeland gave Bensfew the option of buying it by a written agreement for$7,950, or within $50 of twice the amount of their bid at the sale.
The more important and serious question in the case arises upon the insistment upon the part of Jardine that the right to redeem, or the option to purchase, within the 30 days, was waived by the counsel of Heald. Thomas Jardine says that on the 5th or 6th of August he and his brother Vreeland met Mr. Savage on Cherry street in Railway, when the latter said: "'Tom and Freel, I seen that client of mine, and there is nothing in it.' I looked at him and said: 'Mr. Savage, nothing in it, who is your client?' He told us it was Mr, Heald. 'Well.' I said, 'you think he won't buy?' He said, 'No,' that was about it, that he did not talk turkey. I said 1 was very sorry about that, I had just had a chance to sell it. I said, 'I wished you had told me this before.' 'Well,' he said, 'he won't buy.' Then he said to me, 'What did they offer you for it?' * * * So I said to him that I had a chance to sell it to two neighbors of yours, Mr. Phillips and Mr. Klink. I called his attention to them. * * * He said, 'What did they offer you for it?' I said they wanted the salt meadow. I said they did not offer me anything, but they asked me what the salt meadow was worth, and I told them $5 an acre. Mr. Savage said, 'Oh, Tom, what are you thinking of?' I said they offered me $10, and before they left me they said they would give me a good deal more than that. 'Why,' he said, 'don't you know that that is where the money is?' I said, 'No, I don't.' 'Well,' he said, 'don't take less than $200 an acre for that salt meadow.'" On his cross-examination he uses this language: "Mr. Savage met me on Cherry street. He came up to us, and says,
'Tom and Freel, I seen that client of mine, and there is nothing in it. He don't think he would buy.' Now whether I asked him or my brother, I don't know which, but one of us asked him, who his client was. He said, 'Mr. Heald.' 'Then,' I says, 'you don't think he would buy?' 'No, sir,' he says, 'he don't talk turkey once.'" Vreeland Jardine's statement of that interview is in these words: "Mr. Savage came up to us, and said, 'that he had saw his man; that there was nothing in him; not to wait any longeron account of that property; that he had nothing—couldn't raise the money.'" Mr. Savage's statement of this interview is in these words: "I * * * met Thomas and Vreeland Jardine. They stopped me. One or them said, 'How about Heald,—ishegoing tore-deem this property?' I said I hadn't seen Heald, but once since he returned a week or ten days ago. He didn't talk turkey then." Whatever might have been the exact language used by the parties in Cherry street at this time, it would be difficult for the court to conclude from what has been given in evidence as quoted above, that there was a waiver, or any intention to waive the right which had been secured. While both Thomas and Vreeland, in their direct examination speak quite positively, Thomas, in his cross-examination, says that Mr. Savage said he didn't think he would buy. Just afterwards the witness said: "Then I says, 'You don't think he would buy?' 'No, sir, he don't talk turkey once.'" I cannot read this testimony and come to any other conclusion than that Mr. Savage only intended to use language expressive of his opinion or judgment, and not of the determination of his client, Heald, and that the Jardines were not justified in concluding that Heald had committed himself to a refusal. This view of the case seems to be sufficiently supported by the further testimony of Thomas, of Rensfew, to whom Vreeland gave an option of buying on the 7th of August, of Phillips, and of Klink. Thomas says Mr. Phillips and Mr Klink came to see him right after the sale, and wanted to buy this property, and adds: "I stated that we were perfectly willing to sell it for our claim, but I could not do it, because Mr. Savage had an option of thirty days, and that option had not expired; and I referred him to the advertisement of sale in the Woodbridge paper. I referred them to that so they could tell when the thirty days was up; but Mr. Phillips and Mr. Klink came to see me several times, and I still told them that I could not do anything for that very reason, and I never set a price for the very reason of Mr. Savage's option." Thomas makes some effort to qualify this, but I think it is very apparent that he only saw Phillips and Klink once before the interview with Savage on Cherry street The great weight of the testimony is to this effect. The next day after the interview on Cherry street, Vreeland went to New York, and made an agreement, with one Rensfew, a cousin by marriage, who at best had very slender means to make the purchase, to sell to him the property by giving him an option to take the title thereto for $7,950. He says that Vreeland told him about the option given to Heald, but that he had withdrawn it. In his cross-examination the question was put to him, "Did he say that the party who had the option would insist upon it?" to which he answered, "He said probably they would." This is most convincing, not only that Rensfew was not a bona fide purchaser, but that Vreeland did not understand or believe that, because of anything Mr. Savage had said, Heald was committed to a waiver. Mr. Klink says that he had one interview with the Jardines on the 5th of August respecting the purchase of this property, and another interview with Thomas respecting it on the 7th. This was after the interview between Savage and the Jardines on Cherry street. Klink says: "He then went into details, and told me of the sheriff's sale, and of the option he had given to Mr. Savage, and said if I would wait until the expiration of that option that he would sell us the property." Mr Phillips, who was present at both of these interviews between Klink and the Jardines, also says that at the second interview "Mr. Jardine reiterated his statement made at the first meeting, in effect that he was not prepared to close with anybody else because this option with Mr Savage was not out." It is true that the Jardines say that after Savage learned of the sale to Rensfew he expressed himself as very greatly embarrassed, and as though what had transpired between them would cause him heavy pecuniary oss, and urged them to do something by which he might retrieve himself; but whether the conduct of Savage arose from the embarrassment which might ensue from the pretended sale by one of the parties to Rensfew, or from his supposed indiscreet or careless expressions to the Jardines on Cherry street, it is clear beyond controversy that whatever he might have said they did not understand him as undertaking in that interview to waive the option they had given to Heald. Besides the conclusion which seems to result from the foregoing statements, it should be noticed that Heald says he never gave Savage any permission to waive the right of redemption which had been secured. However, as the case now stands, it is unnecessary for me to discuss whether Savage had the right to commit his principal to such waiver or not. I will advise a decree in accordance with these views.