Blockley v. Fowler

Norton, J. delivered the opinion of the Court Field, C. J. and Cope, J. concurring.

This is an action to recover the possession of real estate. The plaintiffs and defendants both claim under A. M. Jackson, the latter under a mortgage sale and the former under a deed. In 1850, May 15th, Jackson executed a mortgage to one McKinney, with a power to sell on default in payment of the mortgage debt. Acting under this power McKinney sold the property on the second day of November, 1850, which was bid in by one Fairchild who, on the same day, reconveyed the property to McKinney, and the latter, on the twelfth day of September, 1853, conveyed to the defendant Fowler, who took possession in 1854, and has since occupied. On the thirtieth day of December, 1859, Jackson made a deed of the premises to the plaintiff Blockley, and this action was commenced on the twenty-fourth day of February, 1860.

On the trial, upon the request of the plaintiffs, the Court gave the following instruction to the jury: “ If the jury believe, from the evidence, that M. B. McKinney, the mortgagee mentioned in the mortgage made by A. M. Jackson to him on the fifteenth day of May, 1850, employed W. H. Fairchild, the purchaser, to attend said sale as his agent, and to buy in the property specified in said mortgage at said sale for the benefit of said McKinney himself, and that said Fairchild was not a bona fide purchaser but purchased said property for said McKinney, and that no consideration was passed between said Fairchild and said McKinney, that then the sale was void.”

This charge was erroneous. A mortgagee who sells under a power contained in the mortgage and becomes himself the purchaser indirectly by having the mortgaged premises bid in for himself, cannot hold it against the mortgagor if the latter chooses to file his bill to set aside the sale or to redeem, provided this be done within a reasonable time after being apprised of the sale. But the sale is not void. It is only voidable. The legal title passes. (Jackson v. Van Dalpen, 5 J. R. 43 ; Jackson v. Walsh, 14 Id. [330407]; Bergen v. Bennet, 1 Caines’ Cases in Error, 1; Slee v. Manhattan Company, 1 Paige’s Ch 48; Davone v. Fanning, 2 J. Ch. 252 ; Scott v. Freeland, 7 Sme. & Mar. 409.)

It is also insisted that the sale was void, on the ground that the notice of sale required by the power was not given. Some of the above cited cases show that such an irregularity, if it occurred, might have been acquiesced in by the mortgagor, and if so, the sale would not be void. It is impossible for us to say how the jury might have found upon this point, or as to the fact of notice having been given, if the case had been properly submitted to them, because under the instruction given, as above stated, the jury, with the testimony of Fairchild as to his having purchased for McKinney unquestioned, could not have done otherwise than find for the plaintiff.