as the exceptions question the correctness of this interpretation of the statute, the same are overruled. The exceptions also raise other questions, affecting some matters of form in the answer, but as counsel stated that the main purpose was to settle the rule upon the question already decided, and as the other matters do not in any way affect the merits of the controversy, they will be deemed to be waived, and no ruling is made thereon.
WOOD and another'll. WEJ,PTON and others.
(OWcuit Oowrt 8. D. Iowa. W. D. November 19,1886.)
F'RAUI>--,FoRGED DEEI>--,T.A.X SALE-REDEMPTION-By WHOM.
B. purchased complainants' lands at tax sale. M.. by means of a forged deed frow complainants' gr/tntor, procured an assignment of the tax certificates to himself after the time of redemption had expired, and had the treasurer's deed made out to himself. Held, that the purchase by M. of the tax certificates could not be a redemption of the land, because M. had no real title to the land.
Held, that M. could notbe held as a trustee of complainants, because com· plainants had no interest under the tax sale.
SAME-WHO MAY COMPLAIN.,
Held, that M.'s fraud was one of which B. could complain, and for which he might rescind the contract of sale, but that complainants' rights were not affected thereby. .
In Equity. Bill to quiet title. , James A. Ne-w and Horace Speed, for complainants. C. E. Richards and Smith McPherson, for defendants.
SHIRAS, J. The subject of controversy in this suit is the ownership of 320 acres of land, situated in Montgomery county. Iowa. The complainants claim title under one Seward Wilson, who bought the land in question in 1862, the deed therefor to Wilson being recorded in July, 1862. Seward Wilson died in 1874, leaving a widow and several chilclren surviving him. The widow and children, being the heirs at law of Seward Wilson, who died intestate, conveyed their interest in the land to Mary E. Wood, who in turn conveyed an undivided one-half interest to Leander Roberts; the said Mary E. Wood and Leander Roberts being the complainants herein. On the seventh of December, 1868, the treasurer of Montgomery county sold said lands for delinquent taxes of the years 1858 to 1867, inclusive; one P. P. Johnson purchasing the E. ! of theS. w. t of section No.n, township 72 N., ofrange 37 W., and one Walter B. Beebee purchasing the remainder of the 320 acres. Before the expiration of the period of redemption, Johnson assigned his certificate of purchase to the 80 acres to one H. N. Moore, to whom the. treasluer'g deed was subsequently issued in proper form. The said Moore .also procured the assignment of the certificate of sale to W. B. Beebee,
and received a treasurer's deed for the 240 acres sold to Beebee. The defendants claim title under these tax sales and deeds, holding under conveyances from said Moore. When ready for hearing the cause was referred to W..W. Morsman,_Rs master, to take the evidence and report his findings of facts and conclusions of law. The master heard the cause, and lIis findings of facts, and recommended that the bill be dismissed. The court ordered a decree in conformity with the findings of the master, but subsequently granted a rehearing upon the exceptions filed to the report of the master on behalf of complainants, and upon this rehearing counsel have ably and exhaustively discussed the questions of law and fact presented by the record. The main contention arises overtbe 240 acres sold at tax sale to Walter B. Beebee. In regard to this tract, it appears that an instrument, purporting to be a quitclaim deed,'executed by Seward Wilson and wife, dated July 24,)871, and conveying the land in dispute to one J. R. Welpton,was delivered to H. N. Moore at Buffalo, New York, by one John W. Sewall, to whom Moore paid $300. The complainants claim, and themaste:r finds, that this deed is in fact a forgery, and not the deed of Seward Wilson and wife, and. that Moore knew .it was a forgery, and procured it as the first step in the fraudulent scheme he had devised to obtain title to the land iJ;l dispute. '. Moore procured a deed from Welpton, the grantee in the forged deed, and then claimed to be the owner of the land, and, as such, to be entitled to redeem the premises from the tax sales already mentioned. He endeavored to induce Beebee to assign his tax certificate t6 him, but at first was unable to do so. He deposited with the auditor of the county certain sums of money, and, claiming to have in fact redeemed the land, he finally, on or about the twenty-fifth of December, 1871, and after the expiration of the period of redemption, procured an assignment of the tax,sale certificate to him by said Beebee, paying him therefor the sum of $200 over and above the amount of the taxes, interest; alld penalties. Having thus obtained the of the tax certificate; he procured the execution of a treastlrer's deed; and his grantees now claim title under and through this deed so executed. On part of complainants it is claimed that Moore's title is obtained in fraud, and that- it would be contrary to all the principles of equity and morals to permit the complainants to be deprived of their property by means so nefarious ,as those adopted by Moore. Certainly, no court would permit the title of a rightful owner to he diV"ested or destroyed by means of forgery and fraud, knowingly perpetrated. The deed apparently executed by Seward Wilson and,wife, but in fact a forgery, does not affect the tiUe held by the widow and heirs of Wilson; and the defendants cannot rest their right to the lands upon this forged instrument. Their title can be made out only under the tllxtiUe derived from the sale made to Beebae. No qUtlstion whatever is raised as to the validity of this sale to Beebee; and the question to be determined is whether it ripened into a title. , On part of complainants it is claimed that, in fact, redemption was '.llade of the premises within the statutory period, arid that the execution
WOOD V. WELPTON.
of the trel1Surer's deed was therefore a void act, ,and wholly inoperative. To support the claim of redemption the complainants, are compelled to rely upon the acts of Moore; for, unless what he did in the premises amounted to a redemption from the tax sale, none was made. Complainants aver that Moore procured the forged deed in order to make it appear upon the record that he was the owner of the land ,and therefore entitled to exercise the right of redemption, and that· in fact he did redeem the premises. " In the exceptions filed to the master's report it is claimed that Moore had a colorable title to the lands, and had therefore a right to redeem. Certainly, it caunot be true that a person who knowingly procures the execution ofa forged deed to himself thereby acquires any title whatever to the land in such deed described. Moore had ,no title to the land, nor oolor of title, previous to the assignment of the tax certificate to him, and hence had no legal right to make redemption. As against Bebee, the purchaser at the tax sale,apayment by Moore to th,6 auditor of the county of a sum sufficient to redeem the lands would not work a redemption thereof, and thereby defeat the interest of the purchaser at tax sale. , Thus, il1 Byingtofl, v. 7 Iowa,512, it is ,"Bythe sale the pJlrchaE!er acquires a valid and substantial the land. He acquires the legal title, subjeqt ,to redemption by the owner, or some one having an ,opposing interest. His position is, by the statute, made- to resemble that of a common law. Third persons-those having no right nor interest in it-have no right to divest hhn of his interest. The doctrine concerning, redemption isgeperally t1;lat one ing any right or interest mayredeem; but a mere stranger cannot intermeddle in it." In Pennv. Olemans,19 Iowa, 372, it is ruled that "it isaettled beyond controversy that a party having no'interest in land has no right to ,redeem it from a sale for taxes. And, ii it turneout that the person who paYl'lhis money for the purposes of redemption had no interest whatever to, be protected by the redemption, his act of l,"edemption can neither vest title in him, or divest that of the tax purehRE!er. Nor can such act of redemption inure to the benefit of the owner who had the right to redeem." This is the well-recognized rule in Iowa, and under it, therefore, payment' of the proper amount to the county aurlito1= by a stranger to the title, will not divest the purchaser of his interest acquired at the sale; llnd the latter .may ,disregard such payment, and, upon the expiration of the period or the redemption, may demand the execution and delivery of the proper treasurer's, deed. ' If, however, the tax purchaser should consent to redemption being made by a stranger, and should accept payment oBhe redemption from him, thereby intentionally giving up his claim to the land, and receiving the J1loney paid in exchange therefor, this would bein-effept II; redemption, anll would inure, to the benefit of the true owner of the Property. If, therefore, it was ulade to appear in the prese;nt case that Bee:bee
consented to a redemption being made of the premises by ]\foore, and that in fact Moore did redeem from the tax sale by payment of the proper amount, then such redemption would inure to the' benefit of the complainants, as the real owners of the property at the time redemption was made. In brief, the facts of the payment are that ]\foore paid into the hands of the auditor the sum of8625, which lacked some $38 of being the full amount needed to perfect a redemption. An arrangement was made between the auditor and Moore to the effect that if Moore did not procure an assignment of the tax sale certificate, then this payment was to be considered as made upon a redemption; but, if he procured the certificate, thertit was not. A certificate of redemption was filled out in a blank which was left attached to the book in the auditor's office, and subsequently canceled, never having been delivered to Moore. Beebee, on the twenty-fifth of December, 1871, assigned to Moore the tax-sale certificate in consideration of the payment of $200 over and above the amount of the taxes, penalties, and interest. When this assignment was made the· period of redemption had expired, and Beebee was entitled to a deed. ,No redemption had been perfected by anyone at that time. The true owner of the property had not made any effort to redeem. Moore had made a deposit with the auditor, but not of an amount sufficient to redeem, nor was it an unconditional payment. Under the arrangement between Moore and the auditor, if Beebee assigned the certificate, the mm:ley was not to be applied by way of redemption, but would belong to Moore. It is not shown that Beebee ever consented to Moore redeeming the property. What is shown is that Beebee assigned the certificate of sale upon receiving $200 more than the sum needed to be paid in redemption. To induce him to transfer his rights, by assigning the certificate, it was represented to him that Moore had in fact redeemed, and that he was the owner of the property; but, while it is clear that a fraud was perpetrated upon him, and that he was thereby induced to assign his interest in the land, it is not shown that he consented to Moore's redeeming the land. Granting that M<>ore had an interest in the land, he did not perfect redemption, because he did not pay to the auditor unconditionally the full amount of the taxes, penalties, and interests. On the other hand, if he had in fact no interest in the land, then no act of his would amount to a redemption, unless Beebee consented to redemption by him, and this consent is not shown. True, there is evidence tending to show that fact, and others represented and believed that redemption had been made; but this question is to be determined by what was done by Moore and Beebee. It is proven beyond dispute that the latter did not part with his interest in the land until the twentyfifth of December, 1871, at which' time the period of redemption had pired, and then he demanded and received the sum of $200 over and above the amount'he would have been entitled to upon the redemption. He knew that-Moore's purpose and ,desire was to obtain all assignment of the certificate,: not as evidence of redemption,but as a source of title, and knowing this, he demanded and received the sum of $200 over and above the Jtaxesand penalties,and, inconsideration thereof, he assigned
his interest in the premises to Moore by transferring the certificate, and hiE! interest at that time was the ownership of the land under and by virtue of the tax title. If the court should hold that the fraud of which Moore was guilty wholly annuls all that he accomplished by it, this would only result in setting aside the transfer by Beebee of his interest in the land, and of the tax deed issued to Moore. It could not affect the validity of the interest held by Beebee, for he is not only entirely innocent of any participation in the fraud complained of, but is in fact the only person injured thereby. When Beebee parted with his interest in the lands on the twenty-fifth of December, 1871, he was entitled to a deed, which 'would have vested in him a good title to the lands. By reason of the fraud perpetrated upon him by Moore, Beebee might rescind the contract, upon discovery ofthe fraud, and, by repayment of the money paid him, compel a reconveyance of the lands by Moore. He might, however, elect to waive this right, and treat the voidable contract as valid. If he did, then, as he had a valid interest in the land, his interest and title would vest in Moore, and the latter could rely thereon as against all other claimants of the land. Counsel for complainants argue that, in a court of equity, it should be held that Moore holds the title derived from Beebee in trust for the rightful owners, to-wit, complainants. The latter, however, never had any interest in the tax title. Beebee held the tax title, not for complainants, but adversely to them. They had no right to demand the conveyance of this title, and Beebee could sell it to anyone he pleased. If the sale by Beebee to Moore was void for fraud, then Moore would hold the title in trust for Beebee. If the latter chose to waive the fraud, then Moore became the owner of Beebee's interest and title, and, as complainants never had any interest or right therein, it cannot be held that Moore received this title in trust for them. In Porter v. Lafferty,33 Iowa, 254, and Curtis v. Smith, 42 Iowa, 665, the supreme court of Iowa held that a tax title would not be invalidated if the tax-sale certificate was assigned by the tax purchaser in the belief that the party purchasing the same was the owner of the land, and as such was entitled to redeem; and if such transfer of the certificate was fraudulently procured by false representations, the party contesting the validity of the tax title as owner could not complain of such fraud, and had no right of relief by reason thereof, as he was not injured or defrauded thereby. The facts in this case show that Beebee had a valid interest in the lands as a purchaser at the tax sale, and that, on the seventh day of December, 1871, he becalne entitled to a treasurer's deed for the lands. On the twenty-fifth of December, 1871, he sold and assigned his interest and title to Moore. This !;lale was brought about by fraud on part of Moore; but Beebee makes no complaint, but recognizes the sale as valid. Conseqnently, Moore, on the twenty-fifth of December, 1871, became entitled to the treasurer's deed, and the same was execnted to him. Under this title the defendants now bold the lands. To defeat this title
complainants aver that, in fact, Moore, though a stranger to the title, redeemed the land before the, expiration of the three years. The evidence fails t'o show that a redemption was in fact made, and consequently the tax title must be held to be valid; and the defendants are therefore entitled to It decree dismissing' the bill on its merits, at cost of complain. ants. A large part of the argument of counsel, and of the evidence, is directed to the question of the validity of the mortgage, purporting to have been executed by Seward Wilson arid wife to one C. C. Knowlton on the nineteenth day of June, 1862. In the view we have taken of the case, it is not necessary to discuss the questions touching ·this mortgage, as the same do not affect the chain of title under which the defendants hold the lands. The exceptions to the master's report are overruled, and decree ordered dismissing bill, at cost of complainants.
MILLS .". HURD and others.
(Oircuit Oourt. D.Oon'Mcticut. January 6,1887.)
Where a plan for the incorporation and consolidation of certain Joint-stock associations was being carried out; by consent of nearly all the stockholders. under a charter from the legislature, and one of the stockholders, who had previously favored the scheme, sought by suit in equity to prevent it. and to compel an accounting. and the winding up of the old companies, held, that. Its the charges of fraud made in the bill appeared to be baseless, and no harm was likely to ensue to anyone from allowing the proceedings to go on, questions of law arising concerning the validity of the proceedings in several respects would not be decided upon a motion for an injunction and receiver pendente lit8. and that srich motion would be denied..
In Equity. Alvan P. Hyde and Wm. A. Underwood, for plaintiff. Henry Robi'n80n and Goodwin Stoddard, for Consolidated Rolling. stock Co. Wm. a. Case and T. M. Maltbie, for Hui-d. -
SHIPMAN, J. . These four motions are for an injunction pendente lite. and for the appointment of a temporary receiver in each of said four cases.' Upon these motions, supported and opposed by ex parte affidavits, it is not expedient to attempt to make an exhaustive finding of facts. I shall give merely an outlined statement. Frederick H. Mills, the plaintiff, and John Hurd, one of the defend· ants, organized on October 1, 1881, an association by the name of the Housatonic Rolli'ng-stock Company, which subsequently issued 27,400 shares of stock, of $100 each, and owned 1,644 railroad frei3ht cars. On December 1, 1878, they organized the New England Rolling-stock