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TRUSTEES OF ZION BAPTIST CHURCH v. CONSERVATORS OF THE ESTATE OF WILLIE PEAY, et al.



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TRUSTEES OF ZION BAPTIST
CHURCH

v.

CONSERVATORS OF THE
ESTATE OF WILLIE PEAY, et al.


March 3, 2000

Record No. 990405

TRUSTEES OF ZION BAPTIST CHURCH

v.

CONSERVATORS OF THE ESTATE OF WILLIE PEAY, ET
AL.

FROM THE CIRCUIT COURT OF THE CITY OF
PETERSBURG

Oliver A. Pollard, Jr., Judge

PRESENT: Carrico, C.J., Compton,[1] Lacy, Hassell, Keenan, and Koontz, JJ., and Stephenson,
Senior Justice

OPINION BY SENIOR JUSTICE ROSCOE B. STEPHENSON,
JR.


The principal issue in this appeal is whether
the trial court erred in refusing to set aside a judicial sale
when the building on the subject property was destroyed by fire
shortly after the entry of the decree confirming the sale.

I

On June 20, 1995, the trial court entered an
order, pursuant to Code ? 26-68, appointing Phyllis
Jackson, Greta Mosley, and Lesse Wright co-conservators of the
estate of Willie Peay. The co-conservators are children of Willie
Peay, who had not been seen or heard from since August 18, 1994.

On October 17, 1996, the trial court entered a
decree appointing a special commissioner to sell various
properties owned by Willie Peay in the City of Petersburg,
including that located at 220 Halifax Street. In accordance with
the decree of appointment, the special commissioner duly
advertised the sale of the properties and solicited sealed bids.

Thereafter, Robert L. Bullock, Jr., submitted a
bid in the amount of $92,600 for the property located at 220
Halifax Street. By the trial court’s decree entered December 30,
1996, the special commissioner’s report was confirmed, and
Bullock’s bid was approved and accepted. Bullock, however, failed
to pay the purchase price, and, by decree entered July 10, 1997,
the court ordered a resale of the property. The decree also
provided that Bullock shall be personally liable for (a) all
expenses otherwise chargeable to the estate of Willie Peay in
connection with the resale of the property and (b) the difference
between (i) the bid submitted by Bullock and (ii) the amount
actually paid for the property as a result of the resale. The
decree further provided that, if the amount paid as a result of
the resale exceeded Bullock’s bid and the costs of resale,
Bullock shall be entitled to receive the excess amount paid.

Pursuant to the July 10, 1997 decree, the
special commissioner again advertised the sale of the property,
requesting sealed bids. Zion Baptist Church (the Church)
submitted a bid of $110,100 for the property, and, by a decree
entered September 9, 1997, the trial court confirmed the special
commissioner’s report and approved and accepted the Church’s bid.

On September 10, 1997, before sunrise, a fire
destroyed the building at 220 Halifax Street, and the Church
submitted a new bid of $23,000 "for the land once it has
been cleared."
[2] The special
commissioner submitted a report recommending that the court
accept the bid because the bid "appears to be in the best
interest of the Estate of Willie Peay." The trial court,
however, declined to approve the report. Subsequently, the
co-conservators petitioned the court to conduct a hearing to
resolve the legal issues arising from the unfortunate
circumstances surrounding the sale of the property.

Following a hearing, the court held that,
"[w]hen the [Church's] bid was accepted by the Court on
September 9, 1997, the Church became vested with full equitable
title;" therefore, the Church must bear the loss occasioned
by the fire and the cost of clearing the land.
[3]

II

The Church contends that the trial court erred
when it failed to give notice to the Church of its intention to
accept the Church’s bid. The Church asserts that failure to give
such notice violated its procedural due process rights. We do not
agree.

As directed by the trial court, the special
commissioner published a notice of sale which, in pertinent part,
provided the following:

Persons interested in purchasing [the property] should submit written, sealed bids to [the special commissioner] . . . . [The property] is being sold in "as
is" condition. . . . Bids shall be subject to the
approval of the Court, and the Court shall have the authority to
accept or reject any or all bids. The successful bidder shall be
required to pay the entire purchase price bid . . . at
time of settlement, which shall be made within thirty days
following notification given by the Special Commissioner that
such person is the successful bidder.

The notice of sale makes clear that the
Church’s bid was subject to the trial court’s approval and that
the court was authorized to accept or reject the bid. The notice
of sale also makes clear that the Church, if successful, would be
notified by the special commissioner of the court’s acceptance of
its bid and would be required to proceed to settlement. Nothing
in the notice of sale suggests that the successful bidder would
be given notice prior to the entry of a decree of confirmation.
Thus, we hold that the Church had received all the notice due
process required.
[4]

III

The Church further contends that the trial
court erred in refusing to set aside the September 9, 1997 decree
of confirmation after learning that the building on the subject
property had been destroyed by fire. The Church asserts that, in
refusing to set aside the decree, the Court abused its
discretion.

In the course of a judicial sale, "[u]pon
the entry of a decree of confirmation[,] the transaction becomes
a completed contract of sale." Staples v. Somers,
196 Va. 581, 588, 84 S.E.2d 523, 527 (1954).

Until the sale has been confirmed
. . . the bidder is not considered as a purchaser, and
he is therefore not liable for loss to the property, by fire or
otherwise, . . . nor is he compellable before
confirmation to complete his purchase. But as soon as the sale is
absolutely confirmed, then the contract becomes complete; the
bidder, by the acceptance of his bid, becomes a purchaser
. . . and he may be compelled by the process of the
court to comply with his contract.

Va. Fire & Marine Ins. Co. v. Cottrell,
85 Va. 857, 861, 9 S.E. 132, 133 (1889); accord Hurt
v. Jones, 75 Va. 341, 347 (1881).

As a general rule, after a judicial sale has
been confirmed by a court, the court will not set aside the
decree of confirmation "except for fraud, mistake, surprise,
or other cause for which equity would give relief, if the sale
had been made by the parties in interest, instead of by the
court." Berlin v. Melhorn, 75 Va. 639, 641
(1881). Additionally, from the time of the execution of a valid
contract of sale to the time a deed is executed and delivered,
"[w]hatever loss may fall on the [property] is the loss of
the purchaser [and] [w]hatever advantage may accrue to it is his
gain." This doctrine is firmly established and a law of
property upon which "[t]here can be no grounds of
controversy." Reynolds v. Necessary, 88 Va.
125, 129, 13 S.E. 348, 350 (1891).

In the present case, the trial court gave
careful consideration to the law and the evidence and, in the
exercise of its discretion in the light of well-established law,
concluded that it should not set aside its decree of
confirmation. Although the trial court noted that "arguably
the result is distasteful," its decision is supported by the
law, and we cannot say that the court abused its discretion in
refusing to set aside its decree of confirmation.

Accordingly, the trial court’s judgment will be
affirmed.

Affirmed.

 

FOOTNOTES:

[1] Justice Compton participated in
the hearing and decision of this case prior to the effective date
of his retirement on February 2, 2000.

[2] A City Housing Code Official
determined that the damaged structure was unsafe and requested
its removal or repair. The structure was demolished and the
debris was removed at a cost of $9,600.

[3] The trial court also held that
the Church was entitled to a $44,500 credit against the purchase
price for insurance proceeds that were to be paid into the court.

[4] We reject the Church’s argument
that the court had no power to enter the decree "in
vacation" without notice. Code ? 8.01-445 provides, in
part, that "[t]he distinction of what a court may do in term
as opposed to vacation is hereby abolished."

 

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