Opinion
09-30-1890
In re PATTERSON'S EX'RS.
Charles Mecum, for petitioner.
Charles Mecum, for petitioner.
BIRD, V. C. James K. Patterson in his last will directed his executors to sell certain real estate at public or private sale, and directed the distribution of the proceeds thereof. The executors are among the legatees named in the will, being the children of the testator. These executors filed their petition, asking for permission to become purchasers at the sale which they are so authorized to make. To that end they ask that the court make an order appointing a master, in whose presence, and under whose supervision, the sale shall be made, and, in case one of them should become the purchaser, the executors may make a deed to him, (the master,) who shall execute another deed, and convey the title to the executors who shall so purchase. For this proceeding they rely upon the case of Bassett v. Shoemaker, ante, 52, recently decided in the court of errors and appeals.
The right of executors or other trustees to bid at their own sales by the leave of the court is not questioned. The method of proceeding is of some importance. I think that our practice does not permit that such proceedings can be instituted by petition. There is no statute authorizing persons interested in such cases to come in by petition, without which the cases are very few indeed in which a party can be heard upon petition. Where the cause is not pending in which a person seeks relief, or against whom relief is sought, a petition does not seem to be the proper proceeding to obtain relief. I think, therefore, that the petition in this case should be dismissed on this ground. The only safe course is to proceed by bill. The petition provides not for bringing the other persons interested into court. They have a right to be heard; for, while the executors may be interested in procuring the highest price for the land, yet, if they are permitted to become bidders, it may be more to their interest to secure the land at the lowest possible price. It seems to me, therefore, if the court undertakes to control the direction of this matter, it cannot wisely do so without giving all persons interested in the proceedings an opportunity to answer the allegations of the executors respecting the situation. That it is the right, as stated above, for trustees to ask permission to bid in such cases is not questioned. But when no effort has been made to effect a sale, and trustees come in with the naked assertion that the real estate is greatly depreciated, and that they are apprehensive that the property will be sacrificed unless they be permitted to buy, the power of the court to give them liberty to bid should be exercised with great discretion; and, since the other legatees are interested in securing the highest amount, they may be able to assist the court, if an opportunity be offered them, in the proper exercise of that discretion. The wisdom of the general rule that trustees cannot bid at their own sales is fully acknowledged; and I think it will be as universally acknowledged that, unless the court proceeds with caution when trustees come in before any effort has been made to effect a fair sale of real estate and ask permission to become bidders, the mischief which the rule is designed to prevent may really be promoted under the guise of judicial sanction.
The court is also entitled to an allegation by the trustees in such case (no attempt having been made to effect a sale) showing what in their judgment the lands will probably bring at public sale in case they are not permitted to bid, and also showing what said lands are reasonably worth or their market value, and what they will be willing to give for the same. This is so for the reason that it should appear whether the difference between what the lands will probably sell for at public sale in case the trustees do not bid and what they are willing to give, is at all substantial or not, and so worthy the attention of the court, and of actual benefit to the estate.