Opinion
(December Term, 1832.)
1. A deed obtained by sureties for their indemnity, under a threat of legal process in case of refusal, cannot be set aside by the bargainor for duress in its execution.
2. Property conveyed to a trustee for sale, and sold by him under an agreement with the vendee to be jointly interested in the purchase, is subject to the original trust.
3. A trustee for sale should be indifferent between the debtor and the creditor, and should not sell in disregard of the interest of the former, unless it was so agreed.
4. If the title of some of the trust property is disputed, he should not sell it until the rest is exhausted.
5. And the debtor has a right to the trust property which has been improperly sold by him, and which afterwards comes to his hands or those of his confederates, even if originally sold to one against whom he had no right to relief.
THE case made by the bill, answers, and proofs was that the plaintiff, having been appointed the administrator of Coffield Bass, a half-brother of the defendants Edwin and Gideon Bass, whose mother he had married, had given the defendant Gideon and Matthew Sykes, also a defendant, as his sureties, that he had received of the assets of his intestate about $800. Soon after his marriage he discovered that his wife had by a settlement made before it took place, but without his knowledge, conveyed three negroes to her children by her first husband, of which the intestate was one. The plaintiff filed a bill to set aside that (293) settlement, and by the advice of his counsel procured his letters of administration to be revoked and one Hammonds to be appointed administrator. The next of kin of the intestate were his brothers and sisters of the whole and half-blood, among the latter of which were the defendants Edwin and Gideon Bass. Before the letters to the plaintiff were revoked, he had made payments which reduced the amount due from him to the next of kin. At February Term, 1828, of Nash County Court the plaintiff came to the courthouse, where he got very much intoxicated, and lost a large sum of money at cards. The defendants Sykes and Gideon Bass, hearing of this, demanded counter-security, which the plaintiff gave them by conveying his land and personal property, including the three slaves in dispute between him and the next of kin of Coffield Bass, to the defendant Edwin, in trust to indemnify them. Before the plaintiff consented to do this, his sureties threatened to take instant measures to have his accounts closed and the balance collected. A sale of the property conveyed to the defendant Edwin was by him advertised for 15 March following, at the plaintiff's house, but was not known to either the plaintiff or to Sykes until within a few days of that time. On that day the plaintiff requested that the sale might be postponed to the next court week, which being refused, he asked that his administration account might be settled in order to prevent the trustee from selling for an amount exceeding the balance; this was also refused, and the sale proceeded, when two negroes which had cost the plaintiff $800 were sold to Edmund and Isaac Bass, brothers of Edwin and Gideon, for $477. After this the plaintiff told the trustee that the amount raised was sufficient to pay the balance due by him to the next of kin of Coffield Bass and begged that any further sale might be postponed until he could settle with Hammonds, who was present; which was refused, and the negroes in dispute between the plaintiffs and the next of kin were then offered. The plaintiff earnestly requested that they might not be sold, as (294) the doubt respecting the title to them would prevent them from bringing their value, and in lieu of selling them, he asked that other property, the title of which was clear, might be sold. But while the plaintiff and a friend were endeavoring to effect a settlement with Hammonds, these slaves were sold at about one-tenth of their value and purchased by one Moore, with whom the Basses quarreled for bidding, and who, in the course of a few days, transferred his purchase to the defendant Edwin. All the negroes purchased were held on the joint account of the defendants Edwin and Gideon and such others of the next of kin as chose to claim an interest in them, rather than to receive their share of the surplus in money.
Badger for plaintiff.
Dvereux for defendants.
The bill charged that the deed of trust had been obtained by duress, and prayed to have the sale declared to be void and the defendant Edwin to be a trustee for the plaintiff, and for an account of the hires of the slaves since the sale.
The allegation in the bill that the deed of trust was obtained by improper means is not supported. Sykes and G. Bass had a right to a counter-security, and the dissipation of the plaintiff about that time made it an act of but common prudence then to apply for it. The witnesses prove that although the plaintiff had been in a deep debauch, during which he had been plundered at the gaming table, he had so far recovered from it, and regained his faculties as to be capable of understanding the instrument he executed, which was read and explained to him and understood by him. Then as to the idea of coercion, and that sort of restraint on his free will which we look upon here as a species of duress, I must say that he was asked to do nothing (295) which he ought not to have done. And it was not unfair in the sureties to inform him, as a motive for him to give the deed, that if he did not voluntarily secure them, they would use such other means as the law afforded for that purpose. They do not seem to have done this to alarm a timid man, not aware of his rights and not master of his actions, to gain from him what he would not willingly grant, or they might not rightfully ask, but to have presented the facts to his view as reasonably justifying them in their demand of a security, and as properly inducing him to give it, upon a score of convenience to himself and justice to them. In fine, the execution of the deed seems to have been voluntary on the part of the plaintiff, and the instrument must be established.
The proceedings under it are viewed by the Court very differently. It is clearly in proof that all the negroes sold have remained in the possession of Edwin Bass ever since the sale, he claiming the ownership in them for himself and others, under the purchase made at his own sale. Two of them were purchased by Isaac Bass, under an agreement before the sale, between him and the defendants Gideon and Edwin, the trustee, that a purchase should be made of all the slaves for the benefit of the three and such others of their brethren as chose to come in. This comes precisely within the common rule that such a purchase by a trustee is void. It is equally so with respect to those who join in the purchase as with respect to the trustee himself. They have united in an act of fraud and imposition, and all must fare alike. The deposition of Isaac Bass (a party to that agreement) proves that Edwin has those slaves, as well as the others mentioned in the bill, now in his possession, awaiting the determination of this suit, for a division among them. As Edwin has never conveyed, and the sale was void, they remain the property of the plaintiff, liable only as a security for the debts.
The other three slaves are differently situated, which makes it necessary to advert to other considerations. They were at that time, and when the deed was made, the subject of a suit in which Hunt (296) claimed them on one side and the Bass family on the other. It does not appear how that controversy was determined, or whether it has been determined. Hunt had made payments to some of the next of kin of his intestate, but no final settlement had taken place, nor an account current of his administration made. In a very few days after the deed was executed the trustee, at the request, as he says, of some of the next of kin, of whom he was one, advertised a sale. He gave no notice of it to Sykes or to Hunt, who heard it by accident only a day or two before the sale. On the day of sale Hunt urged that he had made payments, and requested a postponement for a few days, when he would consent to a sale at the courthouse on a court day. That was refused. He then requested that an account might be taken, and the sum due from him ascertained. That was also refused, and the negroes first mentioned were sold and bought in by Isaac Bass, for the trustee and himself and others. The trustee was then about to offer the three negroes of which the title was in dispute, when Hunt repeated his entreaty that the calculations should be made so as to ascertain whether there was yet a balance owing by him, and, if one should be found, that it might be raised out of a tract of land or other property, to which the title was clear. The trustee did not assent to the arrangement, and while Hunt and the administrator had retired to compute the debt, those three negroes were offered as being in dispute, and sold at a great undervalue. They were not bought by either Bass, although their agreement extended to them, but were purchased, much to their displeasure, by a Mr. Moore, who in a day or two transferred his purchase to Edwin Bass, the trustee, and he now holds them, as he does the others, for the joint benefit of himself and his brothers.
A sale thus conducted cannot be supported in this Court. A trustee to sell should stand indifferent between the debtor and creditor; he is charged with the interests of both, and should take reasonable (297) care of them. Where there is no absolute necessity for an immediate sale, it is a breach of his duty to bring it on at a disadvantage, unless it was in the contemplation of all the parties to sell at all events, subject to the cloud on the title. And certainly when there is other property with a clear title, that which is in dispute ought not to be sold until the other has been exhausted, especially against the expressed will of the owner. But the circumstances in this case do not only show a total disregard on the part of the trustee of the interests of the debtor, but conclusively prove a design to oppress and ruin him, for the sake of gain to himself and his associates. The time of the sale, without an intimation of it to Hunt; the refusal to postpone it even until he could ascertain the sum to be raised; the refusal to sell the land instead of the negroes, although importunately urged to do so by Hunt and his friends; and the previous agreement to have all the negroes purchased on the joint account of himself and his brothers, and thereby extinguish the claim of Hunt, which they were then contesting at law, all mark the purpose to sacrifice the unfortunate man who had reposed a misplaced confidence in him.
Such conduct amounts to a flagrant breach of trust, and subjects the trustee to the payment of the full value of the property sold, and in that way Edwin Bass would be charged here, if necessary; and Gideon, also, who participated throughout with him in conducting the sale and gaining an interest under it. But as the slaves have been given up by Moore, and got back to the hands that have done the wrong, the plaintiff has a right to them specifically. These parties cannot protect themselves under the purchase of Moore, even if it were consummated, which is doubtful. When the property comes back to them, they cannot say they ever parted from it, since the disposition was an act of the most aggravated wrong. As to them, the sale was absolutely void.
The plaintiff is, therefore, entitled to have an account taken of the debts secured by the deed, and a credit for the full value of the property sold other than the negroes, and also for the hire of the negroes, and to have a reconveyance, upon the payment of the balance (298) that may be found due.
PER CURIAM. Direct an account.
Cited: Denny v. Palmer, 27 N.C. 630; Johnston v. Eason, 38 N.C. 334; Froneberger v. Lewis, 79 N.C. 429; Gibson v. Barbour, 100 N.C. 197.