Sunday, December 1, 2013

Equitable Life Assurance Society of the United States v. First National Bank case brief

Equitable Life Assurance Society of the United States v. First National Bank case brief summary
602 N.W.2d 291 (1999)


CASE SYNOPSIS
Plaintiff and defendants mortgagors and bank filed separate appeals seeking reversal of an order of the Circuit Court, Sixth Judicial Circuit, Jones County (South Dakota), confirming a sheriff's sale of foreclosed real estate.

CASE FACTS
Plaintiff mortgagee obtained a judgment of foreclosure on defendant mortgagor's property, authorizing its sale at auction on October 15. On October 14, defendant bank entered into an agreement with plaintiff to buy plaintiff's interest in the mortgage. Plaintiff's attorney was unable to reach the sheriff to cancel the sale until he did so by interrupting the auction in progress. The sheriff disregarded plaintiff's wishes and continued the sale, selling the property to the highest bidder.

DISCUSSION

  • On appeal, the court canceled the sale. 
  • The sale was advertised as "with reserve," allowing the sheriff to withdraw the goods at any time before announcing the sale's completion. 
  • The sheriff was acting as plaintiff's agent and should have canceled the sale. 
  • The successful bidder was put on notice before the fall of the hammer that the offer to sell was withdrawn. 
  • Thus, there was no offer to accept.

CONCLUSION
The court reversed the lower court's order confirming the sale because the sale was advertised as being at auction with reserve, allowing the auctioneer (sheriff) to withdraw the property at any time before announcing the sale's completion. The sheriff, as plaintiff's agent, should have complied with plaintiff's request to cancel the sale.

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