give the purchaser the intermediate rents; and he is accordingly not entitled to any rents which accrue before the sale is confirmed. 15 It follows that an appeal by the owner from an order confirming a sale has the effect of setting aside the confirmation and suspending the purchaser's right to take possession or receive the rents and profits until the appeal can be heard; and that pending the appeal, the owner has a right to remain in possession and receive the rents, and the subsequent dismissal of his appeal will not deprive him of the intermediate profits. This being so, it is improper in these jurisdictions to impound the rents and profits and crops of land sold at judicial sale and put them into the hands of a receiver during the time while the order of confirmation is suspended by an appeal therefrom.16 Upon a judicial sale of land between the periodical dates fixed for the payment of rent, there is no right to an apportionment of the rent due at the next day for payment. In the absence of statute the rent is indivisible, and the purchaser is entitled to all or none. But however it be as to the intermediate rents, it is generally agreed that the confirmation of a sale by which a credit is given to the purchaser entitles him to rents becoming due thereafter.18 So upon the sale of leased lands he is entitled to rents accruing subsequent to the confirmation unless reserved by express language or clear implication.19 Hence the defendant in a suit in chancery resulting in a sale of the land cannot, pending the suit, by an assignment sever the future rents from the reversion so as to affect the right of a purchaser at the sale by order of the court to rents accruing after his purchase is complete.20 But although, as a general rule, the purchaser is entitled to rent becoming due after title has vested in him, a well defined exception to the rule has been recognized by virtue of which the purchaser at a judicial sale acquires no right to the landlord's share of a growing crop which the tenant has agreed to pay as rent.1 Moreover, it is the right to possession coupled with the title that gives the purchaser the right to the rents and profits from the time of confirmation. If therefore the right to the possession is postponed by the act of the purchaser or with his consent, the right to the rent is also postponed. Where the purchaser fails to comply with his bid. and the land is resold at his risk for more than his bid, he is not Note: 72 A. S. R. 73. 19. Smith v. Newman, 140 Ky. 80, entitled to the excess or the rents accruing between the time of the confirmation of his purchase and the resale. 107. Compensation for Condemned Property.-Where land is sold at a judicial sale after condemnation proceedings have been instituted and before they have been fully consummated, the compensation awarded for the condemnation goes to the purchaser, in the absence of an agreement to the contrary, he being regarded as the owner of the property from the day of sale; and this rule applies even though the deed is not passed to him until after the condemnation proceedings have been fully consummated. Furthermore, even though the intending purchaser refuses to take the deed, he has an interest in the compensation fund to the extent that he should not be compelled to pay in damages more than the difference of the price that he has agreed to pay and the price received for the condemned premises. If, however, the condemnation has proceeded to the point where the landowner's right to compensation is fixed and the condemner has acquired a vested right in the property or easement condemned, a judicial sale, passing as it does only the title existing in the defendant at the time thereof, gives to the purchaser no right to the compensation awarded. Thus, a judicial sale made after the compensation has been paid into court gives the purchaser no interest in the fund. Similarly, it has been held that the right to compensation becomes fixed at the time the condemner begins construction of its railroad on the property condemned, and that a subsequent judicial sale passes no right to the compensation awarded. And where a city has acquired the title to the property, but the damages have not been properly assessed and paid into court before a judicial sale thereof takes place, the right to compensation does not pass with the land but rests with the former owners of the property. So it has been said that an action to determine whether the original owner or the buyer at a judicial sale is entitled to compensation was prematurely brought before the city had paid the condemnation money into court even though the ordinance condemning the property had been properly enacted. However, the purchaser has been permitted to recover the compensation after the city has completed the formalities of taking the land but has not gone into actual possession and before compensation has been awarded. An express reservation of compensation may be validly made, and if so the purchaser at the judicial sale has no right to it. An understanding to this effect is made out where it is distinctly announced at the sale that the amount of the judgment of compensation shall be paid to the vendor, and a statement to this effect is contained in the report 3. Note: Ann. Cas. 1912B 400. As 4. Damon v. Ryan, 74 Wash. 138, to the effect in general of a resale on 132 Pac. 871, Ann. Cas. 1915A 734. the rights of the original purchaser, and note. see infra, par. 126. of sale, which is approved and confirmed by the court without objection from the purchaser. And the agreement in regard to the reservation is not required to be in writing by the statute of frauds. Of course, the right to compensation passes to the purchaser at a judicial sale made before the commencement of the condemnation proceedings, the purchaser going into possession while the proceeding is pending.5 XII. PAYMENT AND DISTRIBUTION 108. Time and Terms of Payment.-The terms, medium, and time of payment are usually prescribed by statute, rule of court, or decree of sale, and announced in the notice or advertisement thereof. They are, of course, binding upon all parties to the sale unless modified or set aside by the court. Sometimes the payment of the full amount of the purchase price in cash on the day of sale is required. In such case, the commissioners appointed to make the sale have no authority to accept from the purchaser anything but cash, nor can they postpone payment of the sum offered beyond the day of sale. Although the legal meaning of the term "cash" is specie, in common parlance it includes current bills as well, and an advertisement that the sale was to be for cash would be understood by every one to be for current bills. The court has the power, unless prevented by statute or the contract of the parties, to order or permit the sale to be made upon prescribed terms of credit.10 The usual practice is to require a deposit in a specified amount to be made at the time of the sale, when the property has been knocked off to the successful bidder, or even before bids are received; the balance to be paid upon confirmation of the sale, or thereafter, either in a lump sum or in periodic instalments, and in the meantime to bear interest and to be secured to the satisfaction of the court or trustee.11 In such a case, the purchaser may insist upon the terms of his purchase, and need not pay cash until the expiration of the period of credit when he has bought on time.12 And a purchaser who completes the purchase of a defective title is not liable for interest on the price bid from the time of the sale to the time he completes the purchase.18 5. Note: Ann. Cas. 1915A 736 et Murdock's Case, 2 Bland (Md.) 461, 20 Am. Dec. 381. seq. 6. Note: Ann. Cas. 1915C 997. See supra, par. 31 et seq. 7. Camden v. Mayhew, 129 U. S. 73, 9 S. Ct. 246, 32 U. S. (L. ed.) 608; Farr v. Sims, Rich. Eq. Cas. (S. C.) 122, 24 Am. Dec. 396. 8. Camden v. Mayhew, 129 U. S. 73, 9 S. Ct. 246, 32 U. S. (L. ed.) 608; 9. Farr v. Sims, Rich. Eq. Cas. (S. C.) 122, 24 Am. Dec. 396. 10. See supra, par. 36. 11. Lowndes v. Chisolm, 2 McCord Eq. (S. C.) 455, 16 Am. Dec. 667. Note: Ann. Cas. 1912B 400. 12. Note: 70 Am. Dec. 586. 13. Note: 52 L.R.A. (N.S.) 752. 109. Extension of Time.-Where at a judicial sale made in compliance with an order of the court under notices requiring cash payment on the day of sale, a bid is made within the terms of the sale and the intending purchaser is unable to secure sufficient funds immediately with which to make such cash payment, it is a reasonable exercise of discretion on the part of the court to extend the time within which the cash payment shall be made, where no injury is done to anyone by failure of the purchaser to pay at once the sum due on his bid. And this extension of time does not operate to convert the transaction into a private sale. Nor does the mere failure of the bidder immediately to make the payment necessary on his bid destroy the right of the seller to require or accept payment later.14 Even though the order of sale provides for the payment of the purchase money, either the whole thereof or by instalments, at a certain time, such direction is regarded not as mandatory, but as directory merely, since time is not of the essence of the transaction in regard to payment,15 as it is with reference to the performance of the contract by the officer selling in the matter of executing and tendering a deed to the purchaser.16 Though of course this question could not ordinarily arise in jurisdictions where it is the duty of the officer making the sale to resell the property immediately that is to say, before leaving the place of sale-upon the purchaser's failure to comply with such terms as are to be performed immediately at the close of the sale, it is said that it is only after the court finds that the purchaser will not pay the balance of the purchase money that it will order a resale of the property; and accordingly the rule or decree ought to give the purchaser a reasonable time, as specified therein, to comply with his bid before the resale is ordered or advertised. Wherefore, the usual practice is to direct an order to the delinquent purchaser to show cause why he should not complete, and to order a resale upon his failing to show sufficient cause; and there are cases holding that such an order should name a time in which the purchaser may complete. It would seem, too, as a practical matter in cases of this kind that the court should have power at least to allow completion within the time that must elapse before a resale can be had, such as the time. of advertisement, and the like. So it is held that the court has it in its power to permit a bidder to pay the purchase money due by him at any time before the carrying into effect of the order for the resale, even though the order for resale has not been passed until a long period of time after the first sale. But an extension of the time for compliance with the bid materially beyond the time in which a resale can be had involves a change in the terms of sale after the sale has 14. In re Great Western Beet Sugar Co., 22 Idaho 328, 125 Pac. 799, 43 L.R.A. (N.S.) 671 and note. 15. Note: 43 L.R.A. (N.S.) 673. been made; and such an extension might, it seems, be objected to by those who claimed that they would have bid at the sale had the terms of payment been as easy as those thereafter allowed by the court.17 110. Payee.-Payment is ordinarily to be made to the officer conducting the sale, or to the lawful holder of the bonds or other securities given for the purchase price, unless some other recipient has been designated by statute or decree. But a purchaser who pays the purchase money to a commissioner who has not executed the bond required by the decree, or whose bond has been disapproved by the court clerk, or who for any other reason has not authority to receive the payment, pays in his own wrong and is liable for the amount thereof. The land, if conveyed to the purchaser, is subject to a lien for the sums wrongfully paid. But the commissioner of course must answer to the purchaser for the amount that he received. 18 Where it is deemed safe and convenient, the court may authorize the purchaser to make his payment directly to the creditors or other parties entitled to receive the purchase money, or may even assign to them the purchaser's bonds, without requiring the proceeds to be collected by and passed through the hands of a trustee in payment. Thus, where it appears that although the proceeds of sale are amply sufficient to pay all creditors, yet all the moneys which had been brought into court by the trustee had been applied as directed, it may be necessary and proper, upon the death of the trustee before final payment and distribution of the purchase money, to direct the purchaser to pay the last of the claims which had been brought in and established. 19 111. Medium of Payment.-As a general rule, the purchase price at a judicial sale must be paid in money, in the absence of an authoritative direction to the contrary. If the agent of the court who conducts the sale accepts anything else when he is not empowered to do so, he thereby renders himself personally liable for the price. Accordingly, a promissory note or the personal bond of the purchaser is not a valid payment, unless made so by assent of the parties interested. or by judicial or statutory authority, as is expressly done by statute. in some jurisdictions with reference to certain kinds of judicial sales. It is generally held, also, that a check does not constitute a proper medium of payment at a judicial sale, even though it be certified. But where a check given in payment has been actually cashed for its full value, the sale will be confirmed. And the court will not set aside the sale at the suit of the purchaser on the ground of inadequate payment where the payment was made by check and the purchaser is good for the amount of it. By the weight of authority, too, an seq. 17. Note: 43 L.R.A.(N.S.) 671 et 18. Notes: 69 Am. Dec. 371 et seq.: 70 Am. Dec. 585. 19. Coombs v. Jordan, 3 Bland (Md.) 284, 22 Am. Dec. 236. |