Bowles' Guardian v. Johnson , 218 Ky. 221 ( 1927 )

Affirming.

After our decision in the case of Bowles, et al. v. Bowles, Jr.'s, Admr., et al., 211 Ky. 250, 277 S.W. 260, the appellees, whom we shall call the purchasers, filed an intervening petition in that action by which they sought to obtain the cancellation of certain sale bonds executed by them for property purchased at judicial sale. They were successful. The court accorded them the relief sought and this appeal is prosecuted from the judgment according them that relief, by the guardian ad litem for Joe Mack Bowles.

John C. Bowles, Sr., died intestate in June, 1910, and left surviving him his widow, Malinda Bowles, now Malinda Rutroff, and one son, John C. Bowles, Jr., and to John C. Bowles, Jr., there passed under our laws of descent and distribution, the real estate of John C. Bowles, Sr., subject, of course, to Mrs. Rutroff's right of dower therein. John C. Bowles, Jr., died intestate in August, 1922, and left surviving him his widow, Nola Bowles, and an infant daughter, Joe Mack Bowles, then less than two years of age, and to them the property of John C. Bowles, Jr., passed under our laws of descent and distribution. John C. Bowles, Jr., owed a great deal of money, and a suit was brought to settle his estate, and to sell a portion of his real estate for the payment of his debts. His mother, Mrs. Rutroff, made a claim for dower in this property as the widow of his father, and Nola Bowles also claimed dower in this property as his widow. See Bowles v. Rutroff, 216 Ky. 557, 288 S.W. 312. The little girl, Joe Mack Bowles, was not made a party defendant. The court entered a judgment directing the master commissioner to sell certain property of John C. Bowles, Jr., for the payment of his debts. On February 4, 1924, some property known as the Division street property was sold for $20,100.00 and was purchased by the appellees, Johnson, et al. This sale was regularly reported, the report laid over for exceptions, no exceptions were filed, and on March 19, 1924, the sale was confirmed. The debts proven against the estate of John C. Bowles, Jr., exceeded the expectations of the parties, and it became necessary to sell more property. On June 2, 1924, under this same judgment the master commissioner sold certain property known as the College street property, which was purchased by C.C. Bowles and Mack Bowles. That sale was reported, whereupon C.C. Bowles and Mack Bowles filed exceptions. Their exceptions were overruled and they appealed, and in the case of Bowles v. Bowles, supra, we held their exceptions were well taken, that the judgment under which the property had been sold was void because the little girl, Joe Mack Bowles, had never been made a defendant. Thereupon Johnson, et al., filed an intervening petition in this original proceeding setting up these facts, asking for a cancellation of the sale bonds, which they had executed, and seeking to recover of the estate of John C. Bowles, Jr., the money they had paid on these sale bonds. A short time before, the little girl, Joe Mack Bowles, had been made a party defendant, and J.P. Hobson, Jr., had been appointed her guardian ad litem, whereupon he filed a response to this intervening petition in which he sets up and relies upon this order entered by the Pike circuit court:

"John Scott, master commissioner of this court, having heretofore and on March 10, 1924, filed his report of sale herein showing a sale of the Division street property to J.M. Johnson, R.L. Taylor, Allen Taylor, and J. Mont Lowe, at a price of twenty thousand, one hundred dollars ($20,100.00) on a credit of six, twelve and eighteen months, and no exceptions having been filed or taken thereto, it is ordered that said report be, and the same is hereby confirmed."

He insists that by this order the court has confirmed this sale, and that no one has a right to attack it except the infant defendant, Joe Mack Bowles. He insists that by virtue of this judgment of confirmation, the intervening petitioners and their bondsmen are obligated to pay the whole of the purchase price of the property bid for by them, and that after they have paid it they will be entitled to a lien for it upon the Division street property. Johnson, et al., filed a demurrer to this. Their demurrer was sustained and the court entered a judgment in which it was adjudged that the judgment entered in November, 1923, ordering a sale of this property be set aside, that the sale bonds executed by Johnson, et al., are null and void and are cancelled. From this judgment, Joe Mack Bowles, through her guardian ad litem, has prosecuted this appeal, questioning the right of the court, after the confirmation of this sale to afford to these purchasers any relief, and insisting that the doctrine of caveat emptor applies to purchasers at judicial sales, and a number of cases have been cited in support of the position taken. This liability of purchasers at judicial sales under the doctrine of caveatemptor has been a very fruitful source of appeals in this state since the adoption of our Code of Practice. Previous to that time, any substantial error to the prejudice of the party complaining and apparent in the record was sufficient to authorize a bill of review, but since then in a number of cases it has been held that a judgment confirming a sale cannot be vacated by the court which rendered it after the term at which it was rendered, except upon the grounds and in the mode mentioned in sections 344, 518 and 520 of the Civil Code. The appellant has cited and has relied upon the case of Beale v. Stroud, 191 Ky. 755, 231 S.W. 522, in which case certain land had been sold as the property of Eva Stroud and the sale had been confirmed without exceptions and the purchaser had paid for the land. It was afterwards discovered that Eva Stroud had no title to the land whatever, and the purchaser, Beale, was ousted from its possession. He sought to recover of Eva Stroud, et al., the purchase price. A general demurrer was sustained to his petition and that action was affirmed by this court. A vast number of cases might be cited to the same effect. For example, the case of Williams, et al. v. Glenn's Admr., 87 Ky. 87, 7 S.W. 610, 9 Rawle 941, 12 Am. St. Rep. 461; Trigg v. Jones' Admr., 102 Ky. 44, 42 S.W. 848, 19 Ky. L. R. 1009; Rochester, et al. v. Owen, 197 Ky. 170,246 S.W. 32; Dotson v. Merritt, 141. Ky. 155, 132 S.W. 181; McGuire, et al. v. Garrett, 207 Ky. 714, 270 S.W. 4; Fox, et al. v. McGoodwin's Admr., 56 S.W. 515, 21 Ky. L. R. 1776; Bank v. Peter, 13 Bush 591; Schlosser v. Murnam 20 Rawle 1468, 49 S.W. 421; Kincaid v. Tutt, 88 Ky. 392, 10 Rawle 1006, 11. S.W. 297; Bean, et al. v. Haffendorfer Bros., 84 Ky. 685, 2 S.W. 556, 3 S.W. 138, 8 Rawle 739; Humphrey's Exr. v. Wade, 84 Ky. 391 8 Rawle 384, 1 S.W. 648; Costigan v. Truesdale, 119 Ky. 70,83 S.W. 98, 26 Rawle 971, 115 A.S.R. 251; Thompson v. Brownlee Co., 25 Ky. L. R. 622, 76 S.W. 172; McNeil v. Thompson, 84 S.W. 1145, 27 Ky. L. R. 289; McNeil v. Thompson, 178 Ky. 90,198 S.W. 571, and many others. In all of these cases the court has adhered to the doctrine of caveat emptor, which merely means that the court does not give any warranty of title when property is sold under its order, and a careful examination of these cases will disclose that in each instance the ground for the purchaser's complaint was either that there was some defect in the title of the judgment defendant, that some undisclosed lien had been discovered to exist upon the property, or that the judgment was erroneous. It is well to note, before going further, that the judgment by which a sale is confirmed is a separate and distinct matter, from the judgment under which the sale is made. When a man buys at a valid judicial sale, he thereby becomes a party to the action and it is just as incumbent upon him to take notice of the proceedings thereafter as if he had been formally served with process. If he allows these proceedings to pass unheeded, if he files no exceptions and allows the sale to be confirmed, he is, after its confirmation, in exactly the same position that a defendant is in when he allows a default judgment to be taken against him. After the sale is confirmed, and after the adjournment of the term of court at which it is confirmed, the court that entered the order confirming the sale is without power to vacate or modify it in any way, and if no exceptions have been filed there is no relief this court can give the purchaser if he appeals. If, after such a sale is confirmed, he discovers something which he did not know before, and the term of court at which the order of confirmation was made has ended or 60 days have passed in courts of continuous session, his relief must be found under either section 518 or section 344 of the Civil Code; but while these things are true and these cases that we have cited are all to this effect, we have another line of cases beginning with the case of Carpenter v. Strothers' Heirs, 55 Ky. (16 B. Mon.) 290, wherein a sale was ordered in August, 1853, at which Carpenter bought. The sale was confirmed in June, 1854. Afterwards, Carpenter moved to quash the sale and the sale bonds, his motion was overruled and he appealed and this court held the sale was void, the purchaser got nothing by it and the court had the power to quash the sale and the sale bonds.

To the same effect is the case of Barrett v. Churchill. 57 Ky. (18 B. Mon.) 387; McGowan, et al. v. Way, 58 Ky. (1 Mete.) 418; Woodcock v. Bowman, 61. Ky. (4 Metc.) 40; Watts v. Pond, et al., 61 Ky. (4 Metc.) 61; Falls City Real Estate Building Assn. v. Van Kirk, 71. Ky. (8 Bush) 459; Wyatt v. Grider,158 Ky. 440, 165 S.W. 420; Nornack v. Loar, et al., 11 Ky. L. R. 6. 11 S.W. 538. The difference between the first line of cases and the second is this, that in the first line of cases the judgments were valid, though perhaps erroneous, but the title of the judgment defendants was bad, or the property was encumbered, whereas, in the second line of cases the judgments were void, but the titles of the judgment defendants were good. The purchasers in the first line of cases got such title as the judgment defendants had, whereas in the second line of cases the purchasers got nothing. In the recent case of Coleman, et al. v. Mullins, reported in 216 Ky. 761, 288 S.W. 701, we had before us for consideration a void judgment and we said of it:

" 'A judgment void upon its face and requiring only an inspection of the record to demonstrate its validity is a mere nullity, in legal effect no judgment at all, conferring no right and affording no justification. Nothing can be acquired or lost by it. It neither bestows nor extinguishes any right and may be successfully assailed whenever it is offered as a foundation for the assertion of any claim or title.' "

What we said there applies here, and having in the case of Bowles v. Bowles, supra, held that this judgment was void, it follows that it can neither bestow nor extinguish any right, and can be successfully assailed whenever it is offered as a foundation for the assertion of any claim or title. The guardian ad litem for the infant defendant, however, calls sharply to our attention the distinction between the judgment ordering the sale and the judgment confirming the sale, and is stoutly insisting that though the judgment ordering the sale may be void, the judgment confirming the sale may be valid. There might be something in the position he is taking if it were not for the fact that the infant defendant, whose rights are affected by the judgment, was not properly before the court when the judgment was rendered by which the sale was ordered, and that, therefore, that judgment was void, nor was she properly before the court when the judgment was rendered confirming the sale, and by a parity of reasoning, it must follow that judgment also is void. Therefore there was no error in the action of the trial court in setting aside and cancelling these sale bonds. After a sale is confirmed, and the court has, by the expiration of the term, or in courts of continuous session, after sixty days, lost control over the order of confirmation, the purchaser can only obtain relief upon such grounds as the judgment defendant could obtain relief against him. If the court had no jurisdiction, either for want of service of process, or because special proceedings were not carried on in substantial compliance with a statute, in this case because the infant landowner was not made a defendant, in short, if the judgment of sale is void, and the purchaser cannot under it, sustain his possession against the very party, whose title he is supposed to have bought, he may have the sale vacated even after it has been confirmed. But where the sale is within the jurisdiction of the court, but the title sold is defective (no matter how grossly so), the maxim of caveat emptor applies as fully as if the parties to the suit owning the land, or holding interests therein, or liens thereon, had joined without fraud, in a conveyance to the purchaser, without warranty or covenant of title.

The guardian ad litem here, with commendable zeal is insisting that at this sale the infant's property brought a better price than it will ever bring again, and that, as it was so very beneficial to the infant, it should, in equity, be confirmed. We have found a case where this court did confirm such a sale under such circumstances after it had previously held the sale void. We refer to the case of Woodcock v. Bowman, 63 Ky. (2 Duv.) 508, wherein upon a similar petition on behalf of an infant, we upheld the confirmation of a sale that in the case of Woodcock v. Bowman, 61 Ky. (4 Metc.) 40, we had held to be void; that was done, however, under a curative statute passed probably as a part of the legislation that was deemed to be made necessary by the war then prevailing between the states of this nation. A similar ruling will be found in Thornton, et al. v. McGrath, et al., 62 Ky. (1 Duv.) 350. To sustain the contention of the guardian ad litem we would have to hold this sale was not void, but was voidable at the election of the infant, and allow this sale to stand because beneficial to the infant as was done in the last two cases. These cases came under this curative statute which passed away with the return of peace, and we have since in Elliott v. Fowler, 112 Ky. 376, 23 Ky. L. R. 1676, 65 S.W. 849, elaborately reviewed and restated the law upon the sale of infants' real property, and held that such a sale was void, unless all the provisions of the statute authorizing the sale have been strictly complied with.

Some suggestion has been made here that Malinda Rutroff and Nola Bowles were both sui juris, and were parties to this proceeding, and that therefore this judgment ordering this sale was not wholly void. If Malinda Rutroff and Nola Bowles were here complaining, that question would be before us, but when the judgment was rendered, setting aside this sale and cancelling these sale bonds, no objection was made thereto by either Mrs. Rutroff or Nola Bowles. No exception was reserved by them to the court's action, and they have made no complaint to us, and are not parties to this appeal.

The judgment is affirmed.

The whole court sitting.