Kiser Co. v. Padrick , 30 Ga. App. 642 ( 1923 )

Bell, J.

(After stating the foregoing facts.)

Without the slightest desire to bury the demurrers of the plaintiff in error, we think it unnecessary to set them forth in detail. The points which they raised may be sufficiently indicated by our rulings as announced in the headnotes.

The most important question involved is whether the agreement was void as against public policy. The principal Georgia case on this question seeixxs to be that of Graham v. Theis, 47 Ga. 479. There it appears that one person was induced, for a consideration, not to bid at an administrator’s sale, by another, who did bid and bought the property, both intending to bid but for the agreement. It was held that the agreement was illegal and unenforceable by the person who was induced not to bid, the Supreme Court saying : “ It amounts to a contract to commit a fraud upon the deceased’s estate, by stifling bids' at the sale.” The headnote is rather broad in the statement that “ a contract that one will not bid at an executor’s or administrator’s sale is illegal.” While the result of the contract in the instant case was that Padrick, though originally intending to bid upon the property, failed to do so, it does not appear that both he and the plaintiff in error would have been bidders but for the agreement. We think there is no presumption that the Kiser Company would or would not have been a bidder, in the absence of the contract, and we cannot say that the effect of the agreement was to eliminate a bidder, rather than to substitute another. The facts as pleaded do not disclose, as a matter of law, that the parties entered into a fraudulent combination, rather than an honest union of their strength, from which the creditors might have been benefited. It may be that the Kiser Company would not have cared to bid unless it knew that it would be able promptly to dispose of the property, and while, construing the petition most strongly against the plaintiff, it sufficiently appears that he, as tvell as the Kiser Company, was able to make the purchase, a fraudulent intent on his part should not be presumed as a matter of law merely because he agreed as the consideration for the undertaking by the other party that he would assume the liability of the bankrupt to it. Perhaps Pad-rick felt some moral responsibility to this creditor to make good the loss which it would otherwise sustain, since he was the general manager of the corporation now in bankruptcy, under whose administration, and at whose procurement, it may be, the credit was extended. For some special reason he may have desired to preserve the good will of this particular creditor more than that of others, in case he should carry on the business previously owned by the bankrupt. Or it might have been that, notwithstanding his apparent ability to buy the property himself directly at the sale, he desired an arrangement by which he could pay by installments, rather than for cash; and while it is true that the assumption of a $1,200 debt would be a tremendous price to pay merely for the better terms, that was an affair of his own, if his action was prompted by no fraudulent motive or purpose to chill the sale. This would be a circumstance for the consideration of the jury on the question of intention, but we cannot say it is conclusive of bad motive.

Of course, if the object of the agreement was to suppress and stifle fair competition and thereby to acquire the property for less than its value, it should not be enforced at the instance of either party; otherwise, as between the parties, if the agreement is the result of honest cooperation, though the actual consequence may have been to lessen competition, the principal question as between the parties being whether the intention was fraudulent or bona fide, to be determined by a jury under the evidence.

We do not think this decision is in conflict with anything said in Ruis v. Branch, 138 Ga. 150 (74 S. E. 1081, 42 L. R. A. (N. S.) 1198), or with Barnes v. Mays, 88 Ga. 696 (16 S. E. 67). A reading of the decision in the former case will disclose facts materially different from those now before us. In the latter case it was said (first headnote) that “a person wishing to purchase land at administrator’s sale commits a fraud by hiring another not to bid against hind. On discovery of the fraud after the sale has been consummated, the purchase-money paid and a conveyance executed, the sale will be set aside at the instance of the administrator.” What we have already stated will clearly show the difference between that case and this. In the recent decision of this- court in Rittenbaum v. Cohen, supra, it affirmatively appeared that the contract was not “ the result of bona fide co-operation'on the part of the parties thereto to render a service which neither could alone perform, or which could be better performed for the benefit of the government by the co-operation of the parties to the contract.”

If it can reasonably be done, a contract will be construed as made for a legal rather than an illegal purpose, the more especially when a contract is attacked by a party thereto who has been benefitted thereby. See Robson v. Weil, supra.

Whether the contract pleaded is an illegal one must be determined by a jury under the evidence, having special reference to the intention with which it was made.

The court did not err in overruling the general demurrer, nor any of the special demurrers. We do not deem it profitable to add more to what is said in the headnotes.

Judgment affirmed.

Jenltins, P. J., and Stephens, J., concur.