Barton v. Benson

A contract between two lien creditors by which one of them, is not to bid at an Orphans’ Court sale of real estate, if not made known to the heirs of the decedent and their consent obtained, is contrary to public policy and void, even though the real estate sold was not worth the amountoftheliensagainsl.it: Maii'etv. liams, 103 Pa. 266, distinguished.

ERROR TO THE COURT OF COMMON PLEAS OF ERIE COUNTY. No. 464 January Term 1889, Sup. Ct.; court below, No. 118 November Term 1887, C. P. On October 29,1887, Theo. W. Barton brought an action of assumpsit against William Benson to recover the amount of a judgment against the estate of James F. Benson, deceased, wliicli the plaintiff alleged that the defendant had agreed to pay. Issue. At the trial on January 26, 1889, the plaintiff’s evidence was substantially to the following effect: James F. Benson, of Waterford township, Erie Co., Pa., died in March, 1885, leaving a widow and a family of children, and owning a farm of about 70 acres of improved land. This farm was incumbered by the lien of three judgments, as follows: the first, in favor of William Benson, amounting witli interest and costs to $2,072.65: the second, in favor of Theo. W. Barton, amounting with interest and costs to $560.58; the third, in favor of -William Benson, amounting witli interest and costs to $1,782.37, making a total of liens against the real estate of the decedent, $4,865.60. The real estate of the decedent was worth not more than $3,000. The administratrix of decedent procured an order of the Orphans’ Court to sell the real estate for the payment of the debts. On the day fixed for the sale the defendant, Benson, attended the sale and the plaintiff, Barton, sent his agent W. L. Kelly, who was Barton’s brother-in-law to attend in his interest. The only other persons present were Leon Benson, a son of decedent, and W. I. Port, who acted for the administratrix in making the sale. The defendant there agreed with Kelly, that if he, Kelly, would not bid the property up to an amount sufficient to cover Barton’s lien, he, Benson, would pay Barton’s judgment in full, as he would have to do so in order to protect his lien that was subsequent to Barton’s. In pursuance of this agreement Kelly refrained from bidding the property up to the sum of $3,000, enough to cover Barton’s judgment, and the farm was struck off to Benson for $1,859, in pursuance of the agreement; thereafter the sale was confirmed to him and deed made in pursuance thereof. Barton assigned his judgment to Benson, so that he, being then the only lien creditor, was in a position to receipt his bid, after payment of expenses, to the administratrix without the payment of the money and the expense of an auditor to make distribution, and did so receipt for $1,456.52, to apply on his liens. The defendant denied altogether having made the contract with Kelly as alleged by the plaintiff, and further testified, that . to avoid the payment of his bid into the sheriff’s hands, he had suggested to Barton that he should formally assign his judgment to him, and that he would pay to Barton whatever might be awarded to him on distribution; that after payment of the expenses and the widow’s exemption $300, there remained $1,456.52, for which sum on confirmation of the sale he had given the administratrix his receipt, the amount to be applied on his liens. It was also shown that the alleged agreement between Kelly on the part of Barton, and William Benson, was unknown to the decedent’s administratrix, and to Leon Benson. There was no testimony to show that it was known to the other heirs of the decedent. At the close of the testimony, the court, Gunnison, P. L, instructed the jury that the agreement established by the plaintiff’s testimony was contrary to public policy and could not be enforced. The jury returned a verdict for the defendant. A rule for a new trial having been discharged and judgment entered, the plaintiff took this writ, assigning the instruction to the jury as error.