Opinion
(June Term, 1830.)
1. An executor who buys at his own sale, however openly or fairly, holds the property at the election of the legatee; and one who purchases in conjunction with him is subject to the same rule.
2. But where an executor at his own sale bid fairly, for the purpose of enhancing the price, and the property being struck off to him, sold it the same day, without collusion, to one who had bid against him, although the executor would have held it subject to an account, yet his purchaser, the sale being a distinct transaction, acquired an absolute title.
3. Sales of slaves in lots are not favored in equity, because slaves generally sell better singly; and the person who conducts such sales does it at the peril of answering for the true value. But where the slaves are sold in families, although the executor has no right to consult his feelings at the expense of the legatees, yet he will not be charged the full value unless the interest of the legatees is manifestly injured by the mode of sale.
4. Executors are justified by sales at auction in the usual way. But if they depart from this method, and sell at private sale, they are answerable for the full value.
5. The representatives of an administrator cannot be compelled to account with any person but an administrator de bonis non.
From PITT. The plaintiffs, who were the legatees of Willie (423) Cannon, alleged that the said Cannon died, having published his will, which was proved by the intestate, Charles Jenkins, to whom letters of administration with the will annexed issued, the executor therein appointed having renounced; that directly after the issuing of the letters of administration the administrator, under the pretense of executing the will, but with an intention of fraudulently making a profit to himself, advertised four young negroes, viz., Jacob, Phil, Tom, and Sam, who were directed by the will to be sold upon a credit of ten days; that in pursuance of this fraudulent intent, and to prevent the said slaves from bringing their value, they were sold in one lot, and were bid off by the administrator himself at the price of $1,025; that William Rountree, the intestate of the defendant Jesse, was present at the sale of the slaves, and immediately thereafter took the whole of them into his possession. The plaintiffs averred that the whole of this transaction was a pretense to cover the profit made by the administrator upon a private sale of the negroes by him to Rountree, and they prayed that the sale might be declared to be void and the defendant Jesse decreed to be a trustee of the slaves for their benefit, and that the administrators of Charles Jenkins might account with them for their intestate's administration of Willie Cannon's estate.
Gaston for plaintiff.
Hogg and Mordecai for defendants.
The answers denied altogether the agreement between Jenkins and Rountree, as charged. The defendants admitted that the four negroes were offered together at public sale; but they stated the reason to have been that they were four brothers, whereof the eldest was not more than eight, and the two youngest, twins, about four years of age. They also admitted that at the public sale Jenkins became a bidder, and the last bidder, at $1,025; but they stated that he bid only for the benefit of the estate, and to run up the property; that he did not intend to make, nor did he make, an advantage to himself by the purchase; that the (424) bidding was conclusively for the benefit of Rountree, for that Jenkins and Rountree were bidders against each other; that the credit of that sale was six months, and not ten days; that it was fairly conducted, Jenkins' bids openly given, and dwelt upon by his directions, and that he urged persons to bid upon himself, and, finally, the price at which the negroes were knocked down to Jenkins was a fair and full one, and that after Jenkins was declared the purchaser, and on the same evening, he sold the negroes at the same price to Rountree, who immediately gave his bond, received the negroes, and held the exclusive possession, for his sole use, up to his death, nearly thirteen years afterwards.
The administrators of Charles Jenkins denied that anything was due from their intestate to the plaintiffs, but submitted to an account. Upon replication, proofs were taken, the substance of which is stated in the opinion of the Court.
The bill is framed upon the rule in Ryden v. Jones, 8 N.C. 497, and moreover charges an actual fraud in the purchase by Jenkins at under-value, by means of a sale of all the negroes in a lump, on ten days credit. The doctrine of that and similar cases is recognized throughout. An executor buys at his own risk, and no matter how openly, nor for how full price, he holds purely at the election of the legatee. Nor could this case be distinguished from those by the introduction of Rountree as a third person, provided he purchased in conjunction with the administrator. He who knowingly connects himself with a trustee in a breach of trust (and he must do it knowingly, if he purchase from him on joint account) must abide the fate of his faithless companion, whatever form the transaction may assume.
[His Honor, after stating the substance of the answer, as above, proceeded:] Without scanning the depositions minutely, it is sufficient to say that the answers are fully sustained by the proofs. (425) And the witnesses disclose another fact not mentioned in the answers, which strongly rebuts the charge of collusion, which is that Jenkins' last bid was $25 upon that of Rountree of $1,000. Every person present, members of the family as well as strangers, thought the whole business fairly conducted, and in particular a lady, who is taken to be the widow of the testator, urged Rountree to purchase, as he already owned the mother of the boys. From this state of the facts it is manifest that the case is not within the principle upon which the bill goes. If, indeed, the case of the defendant Rountree rested upon the purchase by Jenkins, it would necessarily give way; for as affecting the title to the slaves, that is a mere nullity. Such, indeed, seems to have been as much the actual intent of Jenkins as it is the conclusion of law. He did not design a purchase for his own benefit. He did not for a moment claim an individual interest. But being desirous of obtaining the best price, he ran the property up against Rountree until it finally fell on himself, and finding that he was unable to screw Rountree higher, he afterwards sold to him for the same price. Rountree's purchase was, therefore, a separate and distinct transaction, of which the validity is not dependent upon the previous purchase of Jenkins, but upon the general authority of the latter, as administrator, and the actual bona fides of the parties in this last and only real sale. And there seems to be nothing in the conduct of the purchaser that can taint his title. It is to be expected that he will buy as low as he can; and he is not to advise in what lots the property is to be offered, nor be responsible for an injudicious arrangement. If, indeed, the smallness of the price, the insolvency of the executor, or, in a word, the whole face of the proceeding, showed a collusion between the vendor and vendee, equity would reach the property. But there is no pretense for that here; for an inadequate price essentially enters into that proposition, and all the witnesses prove that $1,025 was the full value of the negroes (426) as they were purchased by Rountree, namely, in one lot. Nor could the price have altered Rountree's right, notwithstanding the sale in a lump, had he purchased at a public sale, otherwise fairly conducted. The bill must therefore be dismissed as against the administrator of Rountree, with costs.
A sale in the lump may be attended with very different consequences to the administrator himself. The Court does not favor sales by executors in large masses. Most commonly the articles sell best singly; and therefore they ought, in general, to be so offered. It is not exactly like sales by sheriff, which ought to be most strictly watched; for as only so much as will satisfy the execution ought to be sold, so only so much as will probably satisfy it ought to be set up. In sales by executors the whole is to be sold at all events, by the terms of the will. And it is the duty of the executor to get the most he can. Sometimes, indeed, as much, or more, can be had when the property is disposed of in one than in more parcels, as in the instance of a family of slaves, when the children are all of tender years. But he who conducts such a sale does it at his peril, and must answer for the true value where the price has been materially affected by the mode of sale. It would certainly have been harsh to separate these four boys and sever ties which bind even slaves together. True, it must be done if the executor discovers that the interest of the estate requires it; for he is not to indulge his charities at the expense of others. But the Court would not punish him for acting on the common sympathies of our nature unless in so doing he hath plainly injured those with whose interest he stands charged.
This doctrine, however, does not directly apply to the case before us; for it can only embrace sales regularly made by auction, according to the common course. If the executor sell in that way, the price (427) actually obtained is his justification, unless it has been diminished by his mismanagement or fraud. But if he take upon himself to depart from his plain line of duty by selling by private contract, he makes himself responsible for the true value, without reference to the price obtained, unless perhaps in very extreme cases of necessity. In such case he can derive no help from the fact that he disposed of each single article by itself; nor suffer detriment from selling the whole together. In each case he puts himself upon the single point, that as much or more has been got in that way than could have been got by auction. In this respect only is the purchase of Jenkins at his public sale material in this case. Under the circumstances proved, it is deemed a fair criterion of the highest price. Besides that, all the witnesses think it a fair one, and some of them that it is higher than the real value, and that nobody but Rountree, who owned the rest of the family, would have given as much if the negroes had been severally sold. Indeed, it speaks for itself, being $256.25 each for little children. The Court, therefore, cannot but approve of the conduct of the administrator before us.
There is a prayer, in case the plaintiffs cannot recover the slaves themselves, for an account of the proceeds. This involves a general account of Jenkins' administration — an account to which the next of kin have no primary right, but only the administrator de bonis non of the testator; and he is not made a party. In strictness, as the cause has been brought to a hearing without him, the bill might be dismissed, and perhaps it ought, as no application was made for an account before filing the bill, and the main scope of it touches the title to the slaves, and is wholly groundless. But as Jenkins' administrators submit in their answer to an account with the plaintiff for their shares, without (428) making objection to the want of parties, the Court will permit the cause to stand over, as to the administrators and next of kin of Charles Jenkins, a reasonable time for amendment. But in the meanwhile these defendants are entitled to their costs up to this time.
PER CURIAM. Declare that Charles Jenkins did not purchase, and did not intend to purchase, at the public sale made by him, the slaves in the pleadings mentioned, for his own use or that of William Rountree; but that he bid merely to run up the price for the benefit of the estate of Willie Cannon; and declare further, the said purchase by Jenkins to be merely void. Declare further, that on the day of public sale, and after it, William Rountree purchased from said Charles, as administrator, for a valuable consideration, and without collusion, by a new agreement distinct from the purchase aforesaid of said Charles; and decree that the bill be now dismissed, as against the defendant Jesse Rountree, with costs.
Declare further, that the said Charles is liable to the estate of his testator for the actual value of said slaves, because he did not sell them at auction; but that the said price obtained from the said Rountree was a fair and full one, and therefore the Court doth, under the circumstances, approve of the sale to the said William at that price. And because the plaintiffs cannot proceed to the taking of an account of the estate of the testator which came to the hands of said Charles without having the administrator de bonis non before the Court, let the cause be retained, as against the other defendants, with liberty to the plaintiffs to add parties, etc.
Cited: Wynns v. Alexander, 22 N.C. 59; Wilson v. Doster, 42 N.C. 233; Thompson v. Badham, 70 N.C. 143; Tayloe v. Tayloe, 108 N.C. 73.
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