#### S. McD. TATE v. JUNIUS DAVIS, Receiver of the Bank of New Hanover.

(Filed 16 March, 1910.)

Reference — Information for Court — Report Set Aside — Objections and Exceptions.

A referee appointed by the court to look into the demand of a purchaser of land of a receiver of a corporation, that the' purchase price paid by him be refunded owing to defective title of the corporation, and to report thereon, does not fall within the provision of the Code of Civil Procedure with reference to hearing.and determining issues raised by the pleadings in a civil action, and the court may disaffirm the report of the referee eco mero motu, even when no exceptions were regularly filed thereto.

Hoke, J., concurs in result.

Appeal from O. H. Allen, J., at October Term, 1909, of New HaN'oveb.

Motion in tbe cause by B. E. Keith to bave refunded to bim by tbe above-named receiver $500 paid to tbe receiver on 22 May, 1902, for a tract of land sold and conveyed to said Keitb by said receiver, tbe title to wbicb bas failed.

Tbe application of Keitb was referred to a referee. Tbe motion was beard before bis Honor, 0. H. Allen, judge presiding, wbo overruled tbe referee, and denied tbe motion. Tbe petitioner Keitb appealed.

Stevens, Beasley & Weehs and Meares & Ruarh for Keitb.

Rountree & Ca/rr and Thomas W. Davis for receiver.

Bbown, J.

Tbe insolvent corporation of wbicb tbe appellee was appointed receiver bad among its assets a claim, of title to a tract of land in Bladen County, wbicb was sold and conveyed by tbe receiver, to appellant Keitb, wbo paid for it, received a deed without warranty and took possession. It bas subsequently transpired that tbe bank’s title was bad and Keitb bas lost tbe land.

*178Tbe referee found certain facts and reported in favor of refunding tbe money. No exceptions were filed to tbe report, but tbe judge, upon examination of tbe evidence, ruled as follows: “Tbe court disapproves tbe recommendation of tbe referee, and finds as a fact that said Keith purchased said tract of land from said receiver after a full disclosure by said receiver of bis title to same and all facts and claims in regard thereto, especially tbe claim of John D. Kerr, and with full and complete knowl- . edge of tbe title and claims to said land, and with notice from said receiver that be bought at bis own risk. It is therefore considered and adjudged by tbe court that tbe petition be dismissed and that tbe receiver retain said money, tbe court in its discretion refusing tbe prayer of tbe petitioner.”

It is contended that, no exceptions having been regularly filed to tbe report of tbe referee, bis Honor was without authority to set aside tbe report.

Tbe reference was not one made under tbe provisions of tbe Code of Civil Procedure, where a referee is appointed to bear and determine issues raised by tbe pleadings in a civil action. It is mere inquiry made at tbe direction of a chancellor who wishes to inform bis conscience as to tbe justice of a demand made on a fund in bis control. He may set aside ex mero motu tbe recommendation of tbe master or referee and examine into tbe facts himself.

As to tbe merits of tbe case, bis Honor’s findings appear to have little for tbe appellant to base bis claim upon.

Tbe authority relied upon by bis counsel does not fit this case. Etheridge v. Verney, 80 N. C., 78. That was a judicial sale, where tbe decree operated directly upon tbe land sold, and the court was under a moral obligation to make a good title or else to refund tbe money, as it bad not been paid out. Tbe court bad offered tbe property for sale, and not merely some one’s interest in it. At time of bis purchase tbe purchaser did not know of an outstanding claim, but beard of it before confirmation. Tbe court allowed him what it cost to buy in tbe claim. .The sale to Keith was not strictly a judicial sale, but only tbe closing out of tbe assets of an insolvent bank by a receiver, and partook more of tbe character of a sheriff’s sale, where' only tbe interest of tbe execution debtor is sold. Rutherford v. Green, 37 N. C., 122.

Tbe findings of tbe court show conclusively that tbe receiver did not offer for sale a good and indefeasible title, but only such title as tbe bank bad. It is presumed that tbe purchaser *179paid only sueb price as be thought sncb title worth, as be knew all tbe defects before be bought.

It is adjudged that appellant Keith pay tbe costs of tbis ' Court.

Affirmed.

Hoee, J., concurring in result.