Opinion
Argued February 26, 1900
Decided April 17, 1900
Charles F. Brown and Samuel D. Levy for appellants. Franklin Pierce and E. Arnstein for respondent.
Yetta Ullmann died in the city of New York on the 17th day of November, 1897, seized of the lands in question, and leaving a last will and testament which has been duly proved and admitted to probate in which, after providing for her funeral expenses, tombstone and a legacy to her brother, she appoints her son and daughter, the plaintiffs in this action, her executor and executrix, and directs that the residue and remainder of her estate be converted into cash and the proceeds divided into three parts; one part is given to her daughter, the executrix, another part to her son, the executor, and the remaining part to the children of her deceased daughter Fanny Reinhardt. For this purpose she empowered her executor and executrix, or the survivor of them, to sell and convey, grant and dispose of any and all of her real estate at any time after her demise as they might see fit, practicable and expedient, upon such terms and conditions, and in such manner, in their discretion, as they or the survivor of them should deem just or proper, and to make, execute, acknowledge and deliver any and all deeds necessary or proper to give a marketable title. Pursuant to the power so given by the will the executor and executrix entered into an agreement in writing with the defendant Henry M. Bendheim, on the 18th of March, 1898, in which they agreed to sell and convey, and he to purchase, the premises in question for the sum of $12,500. On the day named in the contract for the delivery of the deed and the payment of the purchase price Bendheim objected to the title and refused to complete the purchase. Thereupon an action was brought to compel specific performance, which resulted in a judgment in favor of the appellants, decreeing specific performance on the part of the defendant and adjudging that in case he refused to receive the deed and pay the consideration stipulated in the contract the premises be sold at public auction by a referee named in the judgment, who was directed to deliver to the purchaser a deed of the premises upon his complying with the terms on which the premises should be sold, and, after deducting from the proceeds the referee fees and the costs of the action, to pay to the plaintiffs the balance of the purchase money, and if the proceeds of the sale were insufficient to pay the plaintiffs in full, then they were to have judgment for the deficiency against the defendant Bendheim. The defendant Bendheim refused to receive the deed or to specifically perform the contract as required by the judgment, and thereupon the premises were again sold under the judgment and the respondent Hutter became the purchaser on such sale. The referee, pursuant to the provisions of the judgment, himself executed a deed and tendered it to Hutter, together with a deed from the executor and executrix. and demanded that he complete the purchase, but he refused to accept the deeds, claiming that they did not give to him a marketable title.
The first question presented for review is whether the Supreme Court had the power to authorize a sale of the premises by a referee in the action brought by the executors for specific performance, without making the beneficiaries under the will parties. It is true that under the will of Yetta Ullmann no trust was created and the title to the lands was not vested in the executors. The will, however, did invest the executors with an imperative power of sale, with the broadest discretion in reference to terms and conditions. Acting under the power so given by the will they contracted to convey to Bendheim, and this they had the power to do without making the beneficiaries parties to the contract, and had Bendheim performed his part of the contract the executors could have conveyed to him all of the title to the premises that the testatrix had in her lifetime. Bendheim having refused to perform on his part, the executors had the right to bring an action to compel specific performance by him, and the beneficiaries under the will were not necessary parties in such action. The will having given the executors the power to sell, the duty devolved upon them of exercising that power according to their own wisdom and judgment, and their action bound the beneficiaries. With the power to sell, of necessity, was the power to contract, and with that the power to enforce the contract. In the action so brought judgment was entered for specific performance, following the well-known practice of adjudging a resale, with a personal judgment for deficiency in case the defendant refused or failed to specifically perform the contract. ( Clark v. Hall, 7 Paige, 382, 385.) Judicial sales are usually made by a referee designated by the court or the sheriff of the county, either officer named being the instrument of the court to execute its decree and as such invested with the power of the court to convey all of the title that the court had the power to order transferred. In this case the executors, who were invested with the power to sell and convey under the will in the action brought by them, appealed to the court to enforce the performance of the contract made by them, thus investing the court with all the powers that they possessed under the will to compel specific performance of the contract. It follows that the referee's deed, tendered to the purchaser under the sale made pursuant to the judgment, would have conveyed to him, if accepted, all of the title to the premises which the executors, under their power of sale, could have conveyed.
It is further contended that the deed tendered by the referee was defective for the reason that it recited that it conveyed "all the right, title and interest" of the executors and of the defendant Bendheim "at the time of the entry of said judgment, it being their interest in said premises so sold and conveyed." It is quite true that the executors did not have the title, and the defendant Bendheim, as contractor, had an equitable title only, but each was possessed of a right or interest, the executors of a power under the will, and the defendant of an interest in the money which he had paid under the contract and through his obligation to complete the purchase. Upon referring to the terms of the deed, we find that it recites all the facts incorporated into the judgment with the authority given to the trustee to convey, from which it clearly appears that the deed purports to convey the title of the testatrix through the power given by her will as it had been determined by the court.
In 1873 one Charles Landauer died intestate, seized of the premises in question. He left him surviving a widow, four children and seven infant grandchildren who were children of deceased daughters of the intestate. On the 12th day of August, 1873, the infants, those over fourteen years of age themselves, and those under that age by their father and next friend, petitioned the Court of Common Pleas for the sale of their interests in the premises. Upon such petition the court appointed Lorenze Weiher, the father of some of the infants, special guardian and referred the matter to a referee to report the necessity for the sale. The referee took the evidence and made his report, which was confirmed by the court, and the guardian was ordered to enter into a contract for the sale of the premises. This he did with Louise Weiher, his wife. The contract was reported to the court, where it was confirmed, and the sale concluded, the purchaser giving a mortgage for the amount going to the infants, payable upon their arrival at the age of twenty-one years. The final order of confirmation was entered on the 23d day of October, 1873. It is now contended that the title is defective, for the reason that the wife of the special guardian became the purchaser in such proceedings. This question was raised by the defendant Bendheim, and received the attention of the court in the trial of that action, but it does not appear to have been considered by the Appellate Division in these proceedings. While the court will look with disfavor upon an attempt of an officer conducting a judicial sale to convey to his wife, still the court doubtless has the power in the exercise of its discretion to permit and approve such a sale. The leading case in this state upon the subject is that of Davoue v. Fanning (2 Johns. Ch. 252), which was decided before the adoption of the Married Women's Act. In that case the practice was denounced as poisonous in its consequences and the court refused to approve of the sale, but in the judgment entered the court directed that the premises should be re-exposed for sale by public auction, and if the premises failed to sell for an amount greater than the amount of the former sale, the former sale should in all respects stand confirmed. It thus appears that the court in that case held that under circumstances similar to those in question it had the power to confirm, which power it would exercise in case it appeared that the premises could not be sold for any greater sum. In the case under consideration the report of the special guardian made upon oath to the court shows that the contract was for the best terms upon which he could sell the property. It clearly appeared in the testimony taken in the proceeding that Louise Weiher was his wife, and that fact was necessarily before the court when it made the order confirming the contract and directing the conveyance. This, as we have seen, the court had the power to do, and inasmuch as it approved of the sale with full knowledge of the facts, we think the title cannot now, after the lapse of twenty-six years, and long after all of the infants have become of age, be questioned.
It appears, as we have seen, that the deed from the executors was tendered to the purchaser in connection with the deed from the referee. This fact is recited in the order of the Special Term, but in directing the purchaser to accept the deed tendered by the referee the order omits to include that of the executors. While we are of the opinion that the referee's deed conveys the full title, there can be no harm in giving the purchaser the benefit of the deed from the executors, which was tendered to him and made one of the papers upon which the order was issued. The order should be modified in this particular.
The order of the Appellate Division should be reversed and that of the Special Term, as modified, affirmed, with costs.
PARKER, Ch. J., O'BRIEN, BARTLETT, MARTIN, VANN and LANDON, JJ., concur.
Order reversed, etc.