Weiner v. Slovin , 270 Mass. 392 ( 1930 )

Crosby, J.

This bill in equity is brought to compel the defendant Slovin tc execute and deliver to himself, purchaser at a foreclosure sale, a deed of the premises so sold in accordance with the terms of such sale. The plaintiff also prays for an accounting of the proceeds of the sale, and that the defendant Slovin be enjoined from holding another foreclosure sale. In addition to other defences the statute of frauds is pleaded in the answer.

A master to whom the case was referred found that the real estate in question was subject to a first mortgage held by the Merchants Trust Company of Lawrence in the sum of $8,000; that the defendant Slovin held a second mortgage of $4,100, accrued interest amounting to $160.30, a charge of $480 for interest paid on the first mortgage, and a charge of $175 as expenses of the foreclosure sale, making the total amount due on the defendant’s mortgage $4,915.30; a third mortgage was held by the plaintiff for $1,665, together with interest thereon at the rate of seven per cent from June 22, 1927. Slovin, acting under the power of sale contained in the mortgage held by him, duly caused a notice of sale to be advertised in the Lawrence Telegram, and engaged one Fravole, then a duly licensed auctioneer, to conduct the sale. On May 31, 1928, the sale was conducted on the premises. Slovin, his attorney, the plaintiff’s attorney and the plaintiff’s son were present. The auctioneer went upon the premises, read the notice of sale, and called for bids to be made in accordance with the notice. Slovin then bid $12,000 for the property. The auctioneer called for further bids, and there being none he declared the property sold for $12,000 to Slovin. Both the bid and the acceptance were oral, and at the hearing before the master no evidence was introduced of any writing referring to either. Nor was there evidence of a writing or memorandum of the sale by the auctioneer or any party to the suit, and no deposit was made at the time of the sale or thereafter, so far as appears. No deed was ever made by Slovin relating to the sale, and nothing has been paid by him to the plaintiff. On July 17, 1928, the plaintiff made a written demand upon Slovin for $1,665 and interest thereon at seven per cent from June 22, 1927, the amount due on the plaintiff’s mortgage. An interlocutory decree was entered confirming the master’s report to which no objection was made. In accordance with the defendant’s first request the trial judge ruled that “The contract declared upon, not being in writing, is within the statute of frauds and unenforceable.” The plaintiff appealed from this ruling and from a final decree dismissing the bill.

An auctioneer is the agent of- both parties and has authority to make a memorandum sufficient to satisfy the statute of frauds binding both seller and purchaser. Giolitto v. Dingolo, 251 Mass. 38, and cases cited.

When a mortgagee forecloses by a sale pursuant to a power contained in the mortgage and becomes purchaser at the sale for a price in excess of the amounts due under the provisions of the mortgage, and the auctioneer makes arid signs a memorandum in conformity with the statute of frauds, a suit in equity against such mortgagee can be maintained by junior lienors, if they exist, or by the mortgagor to compel an accounting. Pilok v. Bednarski, 230 Mass. 56, 58. Hood v. Adams, 124 Mass. 481, 483, 484. Those considerations, however, have no application to the facts in the case at bar. The failure of the auctioneer to make any memorandum of the purchase and sale as required by the statute of frauds makes it plain that there was no enforceable sale. The attempted sale was a nullity and never had any binding force or effect upon anyone. It follows that the foreclosure proceedings left the parties, so far as their respective interests' in the mortgage are concerned, in the same position as existed before the attempted foreclosure was commenced. When the statute of frauds has been pleaded as in the case at bar, the burden of proving compliance with its terms rests upon the plaintiff. Price v. Weaver, 13 Gray, 272. Browne, Statute of Frauds (5th ed.) § 535. The statute is as binding in equity as in law. Glass v. Hulbert, 102 Mass. 24, 28. Tracy v. Blinn, 236 Mass. 585, 587. Linsky v. Exchange Trust Co. 260 Mass. 15. It is the contention of the plaintiff that a relationship of trust existed between the parties and that' the defendant was a trustee for the plaintiff in the foreclosure proceedings within the rule as stated in Hood v. Adams, supra, and Pilok v. Bednarski, supra; but in those cases it appeared that there was a sufficient memorandum to satisfy the statute of frauds. It follows in the opinion of a majority of the court that the trial judge correctly ruled that the contract, not being in writing, was within the statute of frauds and unenforceable.

Final decree affirmed with costs of the appeal.