Appeal from the Orphans' Court for St. Mary's County; Jarboe, C. J., and Stone and Alvey, JJ.
Hammond, Prescott, Horney, Marbury and Sybert, JJ. Sybert, J., delivered the opinion of the Court.
Oscar B. Feldman died on July 8 1962 leaving a last will and testament which was duly admitted to probate by the Orphans' Court for St. Mary's County. Herman O. Feldman, a son, qualified as executor. The will devised and bequeathed all of the testator's property, both real and personal, to his wife for life, and upon her death, the will directed that all of the testator's property be sold and the proceeds divided equally among four named children and a grandchild. The executor was empowered to sell the property at public or private sale. The wife of the testator had predeceased him.
At his death the testator was the owner of a waterfront lot of land in St. Mary's County. The property, improved by a four room dwelling and shed, was appraised by two appraisers appointed by the Orphans' Court at $3,500.00. Subsequently, on April 9 1963, the executor, accompanied by his attorney, appeared before the Orphans' Court and told the court that he had arranged a sale of the property for $2,500.00 to his nephew, William Edward Dixon, Jr. (a son of his sister), and had accepted a deposit of $100.00. The Orphans' Court ordered a reappraisal, after which a new appraisal in the amount of $2,000.00 was filed. The executor then reported the sale of the property to his nephew for $2,500.00 and an order nisi was published. Exceptions to the ratification of the sale were filed by the appellant, Robert G. Feldman, a son of the testator and one of the beneficiaries named in the will. With the exceptions there was filed as an exhibit a written offer of one Josephine G. Knight, who lived in the neighborhood, to purchase the lot in question for $3,500.00.
At the hearing on the exceptions before the Orphans' Court, the executor testified as to his private sale of the property to
his nephew for $2,500.00, stating the balance over and above the $100.00 deposit was to be payable in cash. On cross-examination the executor admitted that he did not make any effort to sell the property until six months after he qualified as executor; that he did not advertise the property for sale either by posting it or placing an advertisement in a newspaper; that he did not engage any realtor to help dispose of the property; and that the only action he had taken in regard to selling the property before his nephew offered $2,500.00, was to contact two parties his brother (the appellant) told him were interested in the property. Of these, he said one made an offer of $1,800.00 and the other made no offer. Mrs. Knight testified that her offer of $3,500.00 still stood and that she was willing and able to purchase the property for that amount in cash. After the hearing, the Orphans' Court dismissed the exceptions and ratified the sale to the nephew. The exceptant, Robert G. Feldman, then entered this appeal.
The appellant contends that the sale for $2,500.00 should not have been ratified because the executor did not "act in a prudent and businesslike manner, with a view to obtain as large a price as might, with reasonable diligence and attention, be fairly and reasonably obtainable under the circumstances". The appellee executor submitted no brief or argument here.
This Court, long ago, laid down the rule governing the duty of a fiduciary in selling property of a testator under a testamentary power of sale, in the case of Gould v. Chappell, 42 Md. 466, 470 (1875), wherein it was stated:
"The discretion [to sell property at a public or private sale] thus reposed in the trustees was not a mere arbitrary discretion, but a discretion coupled with a trust, and to be exercised solely for the benefit of the cestuis que trust. It was their duty, therefore, in making a sale of the property to act in a prudent and business-like manner, with a view to obtain as large a price as might, with due diligence and attention, be fairly and reasonably obtainable under the circumstances. In other words, to exercise that diligence and caution which a careful and prudent owner would observe in the sale of his own property. If the sale be
made under circumstances of haste and imprudence, or if the trustees fail in reasonable diligence in inviting competition, or adopt an injudicious and disadvantageous mode of selling the property, a Court of Equity ought not ratify the sale. * * *" (Emphasis in the original.)
In the case of private sales by an executor, "slight inadequacy and reasonable expectation of a better price are sometimes sufficient to justify the setting aside of sales where the approval of a Court is necessary, or where it is invoked", Weinstein v. Boyd, 136 Md. 227, 234, 110 Atl. 506 (1920). See also Webb & Knapp v. Hanover Bank, 214 Md. 230, 133 A.2d 450 (1957); Knight v. Nottingham Farms, Inc., 207 Md. 65, 113 A.2d 382 (1955); and Kramme v. Mewshaw, ...