US SUPREME COURT DECISIONS

Where a bill in chancery states that, at an execution sale, which was alleged to have been open and fair, the complainant purchased, for the sum of $600, certain promissory notes secured by mortgage, amounting in the whole to $260,000, and the bill was demurred to, and the demurrer sustained by the circuit court, this judgment must be reversed.

Mere inadequacy of price does not of itself furnish a sufficient reason for dismissing the bill or deciding that the complainant was entitled to no relief whatever.

It came up upon a demurrer to a bill filed by Andrew Erwin, which demurrer was sustained by the court and the bill dismissed with costs. The facts set forth in the bill, arranged in chronological order, were as follows:

In the year 1839, James M. Wall, a citizen of the State of Mississippi, appears to have been in possession of two plantations in Louisiana, and on 16 November, in that year, sold them, together with the stock and slaves upon them, to William S. Parham for a sum amounting very nearly to $300,000. Of this consideration $35,200 were in cash and the residue in thirteen promissory notes, each for the sum of $20,369.23, payable on 1 January, 1842, 1843, 1844, 1845, 1846, chanrobles.com-red

Page 53 U. S. 198

1847, 1848, 1849, 1850, 1851, 1852, 1853, 1854. These notes were drawn in favor of Wall, made payable and negotiable at the Citizens Bank of New Orleans, and were endorsed "ne varietur" by the notary before whom the deed was acknowledged, and secured by a mortgage of the property. It was further stipulated in the deed that Parham was to settle all claims against the property, and have a credit upon the notes for whatever sums he might pay. A list of the mortgages outstanding upon the property was waived by the parties, because, as was stated in the deed, "Parham was advised of the mortgages existing on said property." The list nowhere appeared in the record.

In 1842, Wall, being a resident of Mississippi, was sued in the circuit court of the United States for that district, by one William M. Beal, a resident and citizen of Louisiana, and a judgment was recovered at the May term in said suit for $2,365.13. An execution was issued upon this judgment against Wall, which was returned "nulla bona."

On 1 August, 1842, Parham conveyed to his mother, Elizabeth Jane Parham, who was also the mother of Wall, all the property which had been conveyed to him by Wall on 16 November, 1839. The consideration for this deed was that the grantee should pay the thirteen promissory notes above mentioned except the sum of $18,000, which was stated to have been paid on account of them; that the grantee should also pay to one W. Ford, Jr., $6,986.52, which Parham owed in three separate notes, and should also pay sundry small debts, not exceeding in the whole five thousand dollars.

On 20 November, 1845, Beal filed a petition in the Ninth District Court of the State of Louisiana setting forth the judgment which he had recovered against Wall in the State of Mississippi, and praying that it might be made executory in Louisiana. An order of seizure and sale was accordingly granted, and, on 19 January, 1846, a writ of fieri facias was issued to the sheriff of the Parish of Madison commanding him to seize all and singular the property movable or immovable, rights and credits of Wall within his parish.

On 24 January, 1846, the sheriff levied this execution upon the thirteen promissory notes above described.

On the first Saturday, in May, 1846, the said sheriff, after having carefully and strictly observed and complied with and performed all the solemnities and formalities required by the law and the statute in such case made and provided, sold two of the thirteen promissory notes, viz., the two which were due on 1st January, 1846 and 1847, to Andrew Erwin, the appellant, and one John W. Nixon, as equal proprietors, for the sum of $300, chanrobles.com-red

Page 53 U. S. 199

that being the last and highest bid, and conveyed the same to the purchasers in due form of law.

On the same day, and after the above sale, the sheriff exposed to sale the remaining eleven notes, which were purchased by Erwin alone, and a deed executed for them by the sheriff.

On 31 January, 1846, between the seizure and sale, Wall acknowledged, before a notary public, that he was indebted to Dick and Hill in the sum of $35,979.53; that he had given them his promissory note for that amount, due on 1 April following; and that, to secure the payment thereof, he, on that day, pledged, transferred, and delivered to said Dick and Hill two of the thirteen notes above mentioned, viz., those which were due on 1 January, 1845 and 1846, respectively.

In the meantime, but when the record did not show exactly, Elizabeth Parham, the mother, died, leaving Parham and Wall her heirs at law.

At some period subsequent to the above transactions, but when the record did not show, Dick and Hill got possession of the rest of the thirteen promissory notes, two of which had been pledged to them by Wall, as above stated.

On 2 January, 1847, Dick and Hill being thus in possession of the notes, caused the mortgaged property, for the purchase of which the notes were given, to be levied upon and seized by the sheriff of the Parish of Madison, and exposed to sale at public auction. They became the purchasers at the sale for the sum of $50,000.

On 26 February, 1847, Erwin filed his bill in the Circuit Court of the United States for Louisiana, setting forth in great detail the above facts and averring that Nixon had sold his half of the two notes purchased by him and Erwin conjointly to some person unknown. The bill charged Dick and Hill with a corrupt, fraudulent, and iniquitous combination and conspiracy to and with Wall to cheat, defraud, and injure the creditors of Wall and especially the complainant. It averred that Dick and Hill were the creditors of Wall, if at all, only for advances made upon crops, which advances had been fully paid; that the sale by them of the mortgaged property was therefore wholly unnecessary; that the sum of $50,000 was an inadequate price; that if they had a claim upon Wall for a sum less than $50,000, the residue, after paying themselves, ought to be shared amongst the creditors of Wall, amongst whom the complainant was one; that Wall was in the enjoyment of all the large revenues from the property. The bill then prayed that Parham should be adjudged to pay &c., and in default thereof that the property might be sold. It further prayed for an injunction upon Parham, Dick, and Hill forbidding chanrobles.com-red

Page 53 U. S. 200

them from selling the property, or disposing in any manner of any of the revenues or crops.

An injunction was granted and the defendants appeared and answered, but afterwards withdrew their answers and demurred to the bill.

On 8 February, 1848, the circuit court dissolved the injunction and dismissed the bill with costs, whereupon the complainant appealed to this Court.