96

injury is done to such owner, the sale will not be vacated for errors or irregularities which were attributable to his own neglect or carelessness or to conduct on his part calculated to deceive or mislead the revenue officers." But if the taxes for which the land is sold had actually been paid before the sale, this will afford ground in equity for setting aside the sale or canceling a tax deed issued thereon. And so, if particular land is by law exempt from taxation, or from the particular tax in question, but nevertheless, by fraud or error, the tax is assessed upon it, and the land is sold for non-payment, this will be ground for setting aside the sale."" So, a fatal defect in the assessment of land for taxation, such as to render it void, will be ground for setting aside a tax sale based on such assessment, including an assessment of the land in the name of a person not the owner, or a want of such a description of the property as would suffice for its identification." And where the owner of the property had no notice of the proceedings against it, by which it was put up and sold for delinquent taxes, this also will be ground for vacating the sale," as will also the fact that the sale took place on a day other than that legally

86 N. W. 617; London Mortgage Co. v. Gibson, 77 Minn. 394, 80 N. W. 205, 777; Wood v. Helmer, 10 Neb. 65, 4 N. W. 968; Scott Mercantile Co. v. Nelson County, 14 N. D. 407, 104 N. W. 528; Bannowsky, 95 Tex. 449, 68 S. W. 47.

Crosby v.

95 Morgan Park v. Knopf, 199 Ill. 444, 65 N. E. 332; Franz v. Krebs, 41 Kan. 223, 21 Pac. 99; Blondin v. Griffin, 133 Mich. 647, 95 N. W. 739; MacKinnon v. Auditor General, 130 Mich. 552, 90 N. W. 329.

96 Boynton v. Ashabranner, 75 Ark. 415, 88 S. W. 566, 1011, 91 S. W. 20; Koen v. Martin, 110 La. 242, 34 South. 429; Smith v. Auditor General, 138 Mich. 582, 101 N. W. 807; Keho v. Auditor General, 138 Mich. 586, 101 N. W. 809; Squire v. McCarthy, 77 Neb. 431, 112 N. W. 327; Wooten v. White, 125 N. C. 403, 34 S. E. 508; Wyatt v. Simpson, 8 W. Va. 394.

97 Smith v. Auditor General, 138 Mich. 582, 101 N. W. 807; Rumsey v. Griffin, 138 Mich. 413, 101 N. W. 571.

98 McLoud v. Mackie, 175 Mass. 355, 56 N. E. 714; Bonnett v. Murdock, 193 Pa. 527, 45 Atl. 317; Shelly v. Friedrichs, 117 La. 679, 42 South. 218; Griffith v. Silver, 125 N. C. 368, 34 S. E. 544.

99 West v. Duncan (C. C.) 42 Fed. 430; Jakobowski v. Auditor General, 144 Mich. 46, 107 N. W. 722; Armstrong v. Exum (Tenn. Ch. App.) 52 S. W. 1024; Scanlan v. Campbell, 22 Tex. Civ. App. 505, 55 S. W. 501.

appointed for the purpose.100 But the fact that real property sold by a county for delinquent taxes is in the possession of the receiver of a court, as a part of the assets of an insolvent corporation, does not afford any ground for setting aside the sale or enjoining the issuance of a tax deed to the purchaser.101

102

§ 453. Inadequacy of Price.—Inadequacy of price alone is not sufficient ground for setting aside a judicial sale of land after confirmation, unless the inadequacy is so gross as to raise a presumption of fraud or to shock the conscience of the court, or unless there are additional circumstances in the case making it inequitable to allow the sale to stand.1 But the principle applies to judicial sales as well as to private sales that great inadequacy of consideration is in itself a strong circumstance to evidence fraud, or, as it is sometimes called, a "badge of fraud," and if there are other circumstances raising a reasonable suspicion of fraudulent or unfair dealing, and which are not explained away, these,

100 Mead v. Day, 54 Miss. 58.

101 Whitehead v. Farmers' L. & T. Co., 98 Fed. 10, 39 C. C. A. 34. 102 Graffam v. Burgess, 117 U. S. 180, 6 Sup. Ct. 686, 29 L. Ed. 839; In re Burr Mfg. & Supply Co., 217 Fed. 16, 133 C. C. A. 126; Files v. Brown, 124 Fed. 133, 59 C. C. A. 403; Hunt v. Fisher (C. C.) 29 Fed. 801; Littell v. Zuntz, 2 Ala. 256, 36 Am. Dec. 415; Roy v. O'Neill, 168 Ala. 354, 52 South. 946; Brittin v. Handy, 20 Ark. 381, 73 Am. Dec. 497; Wells v. Lenox, 108 Ark, 366, 159 S. W. 1099, Ann. Cas. 1914D, 11; Victor Inv. Co. v. Roerig, 22 Colo. App. 257, 124 Pac. 349; Parker v. Glenn, 72 Ga. 637; Oswald v. Johnson, 140 Ga. 62, 78 S. E. 333, Ann. Cas. 1914D, 1; Skakel v. Cycle Trade Pub. Co., 237 Ill. 482, 86 N. E. 1058; Bondurant v. Bondurant, 251 Ill. 324, 96 N. E. 306, Ann. Cas. 1914D, 18; Sowles v. Harvey, 20 Ind. 217, 83 Am. Dec. 315; Kerr v. Haverstick, 94 Ind. 178; Conclin v. Grand Central Sav. & Bldg. Ass'n, 144 Ky. 237, 138 S. W. 312; Coolbaugh v. Roemer, 32 Minn. 445, 21 N. W. 472; Vollum v. Beall, 117 Md. 617, 83 Atl. 1095, Ann. Cas. 1914D, 16; George v. Wood, 94 Miss. 268, 49 South. 147; Dougherty v. Gangloff, 239 Mo. 649, 144 S. W. 434; Mangold v. Bacon, 237 Mo. 496, 141 S. W. 650; Frederick v. Gehling, 92 Neb. 204, 137 N. W. 998; Hoffman v. Godfrey, 79 N. J. Eq. 617, 82 Atl. 900; Knickerbocker Trust Co. v. Carteret Steel Co., 81 N. J. Eq. 130, 86 Atl. 55; Las Vegas Ry. & Power Co. v. Trust Co. of St. Louis County, 15 N. M. 634, 110 Pac. 856; Beckwith v. King's Mountain Co., 87 N. C. 155; Weaver v. Lyon (Pa.) 5 Atl. 782; Connor v. McCoy, 83 S. C. 165, 65 S. E. 257; Guy v. Edmundson (Tex. Civ. App.) 135 S. W. 615; Howell v. Morien, 109 Va. 200, 63 S. E. 1073; Johnson v. Johnson, 66 Wash. 113, 119 Pac. 22.

BLACK RESC.-70

§ 453

RESCISSION OF CONTRACTS

added to the sacrifice of the property, may justly move a court of equity to give relief.103 Hence the rule, as stated by the United States Supreme Court, that great inadequacy of price at a judicial sale of real estate requires only slight circumstances of unfairness in the conduct of the party benefited by the sale to raise a presumption of fraud; and if the inadequacy is so gross as to shock the conscience, or if in addition to gross inadequacy the purchaser has been guilty of unfairness or has taken any undue advantage, or if the owner of the property or the party interested in it has been for any other reason misled or surprised, then the sale will be regarded as fraudulent and voidable, and may be set aside or canceled in equity.104 And the rule appears to be specially applicable in cases where any trick was used to keep the owner of the property away from the sale, or where a false promise was given to him that it should be postponed or that it should not take place before a certain. time.105 But an application for relief on this ground must come from a party who has not been guilty of any improper conduct. Hence where the defendant in an execution, at a sheriff's sale of his land, announced that the property was his wife's, that he forbade the sale, and that he would sue any person who should purchase the property, with the

108 Apperson v. Burgett, 33 Ark. 338; Parker v. Glenn, 72 Ga. 637; Morris v. Robey, 73 Ill. 462; Ames v. Gilmore, 59 Mo. 537; Kloepping v. Stellmacher, 21 N. J. Eq. 328; Fisher v. Shelver, 53 Wis. 498, 10 N. W. 681.

104 Graffam v. Burgess, 117 U. S. 180, 6 Sup. Ct. 686, 29 L. Ed. 839; Ballentyne v. Smith, 205 U. S. 285, 27 Sup. Ct. 527, 51 L. Ed. 803; Schroeder v. Young, 161 U. S. 334, 16 Sup. Ct. 512, 40 L. Ed. 721; Layton v. Rhode Island Hospital Trust Co., 205 Fed. 276, 125 C. C. A. 263; Morrison v. Burnette, 154 Fed. 617, 83 C. C. A. 391; Bondurant v. Bondurant, 251 Ill. 324, 96 N. E. 306, Ann. Cas. 1914D, 18; Haggerty v. Haggerty, 268 Ill. 295, 109 N. E. 34; Fletcher v. McGill, 110 Ind. 395, 10 N. E. 651, 11 N. E. 779; Wright v. Dick, 116 Ind. 538, 19 N. E. 306; Foor v. Mechanics' Bank & Trust Co., 144 Ky. 682, 139 S. W. 840, Ann. Cas. 1913A, 714; Williams v. Chas. F. Dunn & Sons Co., 163 N. C. 206, 79 S. E. 512; Levi v. Greer, 236 Pa. 475, 84 Atl. 917; Haspel v. Lyons, 41 Pa. Super. Ct. 285; Miller v. Winslow, 70 Wash. 401, 126 Pac. 906, Ann. Cas. 1914B, 833; Roger v. Whithan, 56 Wash. 190, 105 Pac. 628, 134 Am. St. Rep. 1105, 21

Ann. Cas. 272.

105 Kinkaid v. Rossa, 31 S. D. 559, 141 N. W. 969, Ann. Cas. 1915D, 1098; Guy v. Edmundson (Tex. Civ. App.) 135 S. W. 615.

natural effect of chilling bids and preventing competition, it was held that he could not have the sale set aside for inadequacy of price however great. 106 And as hardship, not connected with fraud or mistake, is not ordinarily a ground of relief in equity, a court will not find sufficient ground for the cancellation of a tax deed in the mere fact that a valuable property has been sold for a comparatively insignificant tax.107 As to when the inadequacy of consideration is so great as to shock the conscience, no invariable rule can be laid down. But reference may be made to a case in which property sold on execution appeared to be worth about $20,000, with claims against it for $1,700 or $1,800, and the court said that it would be "preposterous" to submit to a jury the question whether $138 was a fair and reasonable price for it.108

The same general rule applies to irregularities in the conduct of the sale or in the proceedings leading up to it. When great inadequacy of price is shown, even slight irregularities will be sufficient to justify the setting aside of the sale,109 as, for instance, offering a large tract of land as a whole, or several parcels in bulk, without first attempting a division and a sale of the separate parts.110 It is said, however, that the irregularity complained of must have caused the inadequacy of the price, or must be such as tended to prevent the property from bringing a fair price.111 But the more equitable rule appears to be that irregularities occurring in the conduct of the sale will be presumed to have affected the price, when the land is sold for a greatly inadequate consideration, so that the burden will be cast upon the purchaser to rebut this inference.112

106 Blum v. Rogers, 71 Tex. 668, 9 S. W. 595.
107 Nester v. Church, 121 Mich. 81, 79 N. W. 893.

108 Moore v. Miller (Tex. Civ. App.) 155 S. W. 573.

109 Peters v. Rice (Tex. Civ. App.) 157 S. W. 1181; Kissinger v. Zieger, 138 Wis. 368, 120 N. W. 249.

110 Berry v. Lovi, 107 Ill. 612; Sublett v. Gardner, 144 Ky. 190, 137 S. W. 864; Guy v. Edmundson (Tex. Civ. App.) 135 S. W. 615. 111 Smith v. Georgia L. & T. Co., 114 Ga. 189, 39 S. E. 846; La Fitte v. Salisbury, 43 Colo. 248, 95 Pac. 1065; First Nat. Bank v. South Beaumont Land & Imp. Co. (Tex. Civ. App.) 128 S. W. 436; Guy v. Edmundson (Tex. Civ. App.) 135 S. W. 615.

112 Kennedy v. Walker (Tex. Civ. App.) 138 S. W. 1115; Snouffer v. Heisig (Tex. Civ. App.) 130 S. W. 912.

§ 454. Remedies Before and After Confirmation of Sale. A judicial sale is not complete until it has been confirmed. by the court, and it may be set aside before such confirmation on account of any irregularities in the sale or any misconduct or unfairness on the part of those interested. But after confirmation, irregularities in the conduct of the sale are cured, and every presumption will be indulged in favor of its fairness and regularity, and it cannot be vacated without a showing of substantial equitable grounds.113 In fact, after the confirmation of a judicial sale it will not be set aside except for fraud, mistake, surprise, or other cause for which equity would grant relief if the sale had been made. by the parties in interest instead of by the court.114 On this point it has been well said: "There is a marked and radical distinction between the situations, the rights of the parties, and the established practice before and after the confirmation of the sale. The purchaser bids with full notice. that the sale to him is subject to confirmation by the court, and that there is a power granted and a duty imposed upon the judicial tribunal when it comes to decide whether or not the sale shall be confirmed so to exercise its judicial power as to secure for the owners of the property the largest practicable returns. He is aware that his rights as a purchaser are subject to the rational exercise of this discretion. But after the sale is confirmed that discretion has been exercised. The power to sell and the power to determine the price at which the sale shall be made has been exhausted. From thenceforth the court and the successful bidder occupy the relation of vendor and purchaser in an executed sale, and nothing is sufficient to avoid it which would not set aside a sale of like character between private parties. Hence the rule is settled, and it seems to be universally approved, that after confirmation of a judicial sale,

118 Cowden v. Wild Goose Mining & Trading Co., 199 Fed. 561, 118 C. C. A. 35; Heid v. Ebner, 133 Fed. 156, 66 C. C. A. 222; Wells v. Lenox, 108 Ark. 366, 159 S. W. 1099, Ann. Cas. 1914D, 11; Bank of Pine Bluff v. Levi, 90 Ark. 166, 118 S. W. 250; Cooley v. Wilson, 42

Iowa, 425.

114 Virginia F. & M. Ins. Co. v. Cottrell, 85 Va. 857, 9 S. E. 132, 17 Am. St. Rep. 108; In re Burr Mfg. & Supply Co., 217 Fed. 16, 133 C. C. A. 126; Yeatman v. Bradford (C. C.) 44 Fed. 536.