«(Jircuit (Jourt, W. D. North Oarolina. May Term, 1888.
1. EQUI'1'Y-LACHES. An ancestor of part of the defendants conveyed certain lands in Tennessee to plaintiffs: ancestors in 1796, the deed being proved and recorded in New York, where,the parties resided.' Shortly thereafter the vendees delivered to the vendor a duplicate of the deed, the latter agreeing in writing indorsed on the original deed to have such duplicate recorded in the proper office in Ten· peliverthe same to a party there, or to the vendee's order, ,all of which he failed to do.J:l.eld that, no proceedings having been brougllt'to perfect the title In stich vendees during the vendor'!! life·time, although he lived for nearly 40 years after the transaction, ,8 bill filed nearly 100 years ,thereafter, when all the parties had been dead for many years, charg. ing such upon information and belief. with fraud iil failing to have such duplicate deed recorded, would not be susta.ined on demurrer as against onein possession of the land for nearly 25 years under tax title, withcolor of , title. , '
When a bill shows upon its face that plaintiff, by reason of lapse of time and his own laches, is not entitled to relief, the obJection may be taken by de· murrer.
In Equity. OI;l demurrer,to bill. Andrew Fuke and Thea. F. Davidson, for complainants. Gudger & (}q,rter and M. E. Carter, for defendant Gudger. Chas. A.Moore and P. A. O/!!mmings, for other defendants. " , DICK, J. The .first cause assigned in the demurrer is,the bill shows its face "that the plaintiffs, and those under whom they claim, have l:!een guilty of gross in delayipg for so long time to prosecute their .claim, and that lapse of tim,e since the cause of action stated in the bill -arose has been so great, this court, under the law rules and practice of tbesame, will rerus.e its; 'The principle in equity is well settled by many authorities that "when the bill shows upon its face that the plaintiff, by reas.0Il ;onapse of time, and of his own laches, is not entitled to ,the may be taker py demurrer." Speidel Y. Henrici, 120 lI!:8., 37J, 7 s,up. Ct. Rep. B10.'The requisites of a bill to prevent such fatal to, the claim of plaintiffs are clearly stated in Badgerv. Badger, 2 Wall. 87, and I will proceed to considerthe principles therein announced, and apply them to the facts in this calle a's admitted by the demurrer. A demurrer only admits facts that are well pleaded. Mere averments of a legal conclusion are not admitted by a demurrer unless the facts and circumstances set forth are sufficient to sustain the allegation. Gould v. Railroad Co., 91 U. S. 526. A bill for relief on the ground of fraud must be specific in its statement of the facts that constitute the fraud alleged. A charge, in general terms, that a tram:action was fraudulent is not sufficiently definite; the particulars must be set forth in detail. Fraud is a conclusion of law. The things done or omitted constituting the fraud must be so stated upon the face of the bill that the court may see that they are fraudulent, if proved or
admitted. The law never presumes fraud, but rather imputes honesty and fair dealing in the conduct of men. Mere words alleging and aver,ring fraud, no matter how often or how strongly set forth in the plead.. ings, cannot make It case for the. interference of a court of equity . They must be connected with some specific acts for which the person charged is legally or equitably responsible to the plaintiff. Van Weel v, Winston, 115 U. S.228, 6 Sup. Ct. Rep. 22 . .1 ",ill now briefly state the facts that are properly set forth in the and which are admitted by the demurrer; and then I will considerth!l question as to the sufficien<:y of the allegations and averments of fraud made upon the face of the bill; and also the reasons and excuses for s&ca long delay in prosecuting the claim. John Love, the ancestor of all the defendants e.xcept Jackson J. Gudger, was seized and possessed in fee '(jf the lands which are the subject-matter of this controversy; and on the 28th day of May, 1796, in the city of New York, did, upon sufficient consideration, sell and convey said lands in fee-simple to David Gelston and Ezra L'Hommedieu, the ancestors of the plaintiffs; and Exhibit A is a correct copy of the deed of conveyance then and there The original deed remained in the possession of the said and was proved and recorded in the secretary's office of the state of New York. On the 18th day of June, 1796, a duplicate was placed in the hands of the vendor, .Tohn Love, who, in an indorsement all the original in the hands of the' vendees, engaged and promisedw have said duplicate "duly recorded in the proper office in the 8tate,of T,ennessee, and to deliver the same, when recorded, either to William Blount, Esquire, or William Cock, Esquire, both of the said state of Tetrnessee,or to the order of the said David Gelston and Ezra L'Hom)lledie.tl; or either of them." The plaintiffs allege that a very thorough examin:- . lltion of the office in which said deed ought to have been. recorded was recently made, and neither the original deed nor record of the same could be found. They further allege that they have not been able, after gent search, to find the duplicate that was in the hands of the vendees; Helston and L'Hommedieu. , The said deed conveyed a legal title to the vendees, which was not di7 vested by the failure of registration, and was in no way impaired, as tween parties and privies. The legal title was not in all respects perfect; as the deed could not be offered in evidence until registered. The were in possession of the original deed, attested by subscribing and could at any time have had the same registered.nthey pad exercised reasonable diligence, they could have easily ascertained whether the vendor, John Love, had complied with his promise to have the duplicate registered in the proper office in. the state of Tennessee.. .It appears from the. illdorsement ofJohn Love 011 the deed that the vendees had two agents or friends in the state of Tennessee to whom they willing that the deed, when recorded, should be delivered" .. The law presumes. person, in dealing with hi", ownproperty;,ifUlc... quainted with .his rights, and will take care of them, if he ha.sa reaaon,; aRIe He allege that a fraud
. 'FEDERAL REPORTER.
has been'perpetrated upon him by any transaction in relation to bis property when he had the means of discovery in his power, and with ordlllary care and attention could have seasonably detected the wrong, and prevented or averted any injurious consequences. The vendees paid a large sum of money for the lands; they had the original deed in their possession; they had agents or friends in the locality where the lands were motive of self-interest to prompt them to situated; they had the diligence in perfecting their title byregistration; and they had ampleopportunity to asoertain wbether John Love had complied with his promises in the indorsement on the original deed. I am unable to make any reasonable conjecture, from the facts alleged in the bill, as to the causes for such apparently gross laches on the part of the ancestors of the plaintiffs. They certainly must have regarded the lands as valuable, or they would not have paid for them such a large sum of money. They must have investigated the title of the vendor, and inquired into the requirements of local laws as to the perfecting of such title. They seem to have lost the original deed, which they held as purchasers; they preserved no letters of correspondence with Love, or anyone else in the state of Tennessee; and they sought no remedy in the courts to have their title perfected, although John Love lived for nearly 40 years after the allege4 fraudulent transaction. If there were any facts stated in the bill tending to show that after the execution of said deed John Love was in possession of said, land::; exercising acts of dominion, I could reasonably conceive that· the parties to this transaction subsequently rescinded their contract, and by mutual agreement destroyed the unregistered deeds, and thus revested the title in John Love; and that the recent accidental discovery of the recorded copy in the secretary's office of the state of New York has ven rise to this controversy. Very indefinite allegations and averments are made by the plaintiffs, founded upon information and belief, as to matters about which they could have no personal knowledge, and could acquire no accurate information, as the transactions occurred nearly a century ago. There are no written memorials to be found after diligent search, except the copy of the original deed on the record of the secretary's office of New York; and all persons who could have had any actual knowledge of thetrnnsaction have been dead for 50 years. There are no statements of facts tending to show that the heirs of John Love ever claimed any interest in these lands; but we can readily suppose, from our knowledge of human nature, that if they claimed any interest they would not have allowed the lands in this state to have been sold for such a small amount of taxes, or they would have seasonably redeemed the same in the manner provided by law. These lands seem to have remained neglected by the owners, and 6pen to squatters and trespassers, until they were duly sold for taxes, and were purchased at public sale by the defendantJacks()n· J. Gudger. After carefully examining and considering all the facts and circumstances set forth in the bill as to the conduct of John Love in relation to the lands which ara the subject-matter of this controversy, I think that it would be the grossest injustice in a court of equity to draw the
HORSFORD fl. GUDGER.
'conclusion of law that he had acted fraudulently, from the loose and definite allegations of fraud in the bill made upon information and lief by persons of a third generation subsequent to the transaction, who have never resided near the lands, and who must have derived their formation from parties who could have had no personal knowledge of the matters. The facts and reasons assigned in the bill as causes of delay in asserting rights, and in seeking proper legal and equitable relief, are entirely insufficient to account for the gross laches of the p1:lintiffs and their ancestors for nearly a century. So far from being sufficient for that purpose, they are not, to my mind, even plausible, as they are not consistent with the prinoiples and motives that usually influence human conduct. In the course of my long professional and judicial experience I have never met with a case more suitable than this one for the tion of the wise and salutary pri!lciples involved in the equitable doctrine of non-interference where there has been Kross negligence in prosecuting rights, and claims have become stale by long lapse of time. Certainly transactions that have been in re.pose for 90 years should not now be disturbed. The parties and actors have been in their graves for. more than 50 years. There seems to have been no charges of fraud alleged against Love in his life-time, when he could have made explanation and defense. It would not be common justice now to infer fraud from indefinite allegations in pleadings, founded upon loose traditions and mere hearsay statements, 50 years after his death. The facts set forth in the bill as to the transactions of the defendant Jackson J. Gudger in relation to the lands in controversy are not cient to give rise to inferences of fraud to be relieved by a court of equity. We know from the public laws of this state that said lands were subject to taxation. The taxes·appearnot to have been paid by the owners, and the lands were proceeded against in due course of law to collect such taxes, and the defendant Gudger became the purchaser at public sale. We must presume that the sheriff, the duly-authorized officerofthelaw, acted rightfully, and iIi conformity with the mandates and provisions of law. The knowledge which the defendant may have had as to the title of the plaintiffs cannot give rise to any ground for a court of equity to impose upon him the liabilities of a constructive trustee. Every chaser at a tax sale knows that he is purchasing the lands of some other person. The law makes very stringent provisions to secure owners of land from any wrong and injustice under tax Bales, and all these visions must be complied with by the sheriff and the purchaser before the title will and even then a reasonable time of redemption is allowed. The defendant Gudger has had possession of said lands as owner for more than 25 under color of title. His rights, whatever they may be, are secured, by the state statute of limitations, from any claim of the plaintiffs that can be asserted in an action at law or suit in equity. The second cause assigned in the demurrer objects to the jurisdiction of the court, as it appears upon the face of the bill that two of the defendants are citizens of the United States residing in the territory of New Mexico. and two are citizens of the District of Columbia. It is well
settled that the: constitutiona.nd laws of the United States only give jurisdiction to the circuit courts to hear and determine the rights of the citizens of different states, and of aliens. Citizens of the territories and of the District of Columbia are incapable of instituting suits in such courts, and said courts cannot compel them, by any process, to appear and answer any legal or equitable procedure, and cannot allow them to make ,ll.voluntary appearance as defendants. The mere fact that such eitizensare named as defendants in this bill, and process is prayed against them,does not make them defendants, as it appears upon the face of the bill that this court can in no way acquire jurisdiction over them. The oonstructive service by notice and publication, as provided for by sections 8, 9, c. 137, Supp. Rev. St., applies only to such defendants as are citizens of different states. The voluntary appearance of these defendants by counsel does not make them parties, as they cannot thus submit their rights to the jurisdiction of this court, and thereby cure all absolute want of judicial power. As this court has not and cannot acquirejurisdiction over them, it can proceed, as if there were no such persons inexistence, to determine. the rights of the parties properly berore the court, unless it appears that these citizens of the United States who are not citizens of any of the states have such an inseperable interest in the subject-matter of this suit that the court cannot so form its decree as to save their rights from serious injury. The plaintiffs in this case seek to establish and secure their rights in certain lands situated in this district, which they claim were duly conveyed to their ancestors by the ancestor of the defendants. They allege tbat the deed of conveyance was lost, or fraudulently destroyed, before registration by the ancestor of the defendants; and they call for the exe,. (mtion of another deed by the defendants, to be "made effectual by regis.: tration, so that they may, in a court of law, successfully assert and en_ force their legal rights to said lands against the claims and trespasses of various persons in pOl;1session, receiving rents and profits, and doing serious a general rule, in suits in equity, whenever the inheritance damage. in· real estate may be materially affected by a decree, it is necessary that all persons entitled to such inheritance should be before the court as parties... But such general rule has exceptions. Etheridge v. Vernoy, 71 N. C. 184. Courts of equity recognize and observe the well-settled ciple of legal and natural justice that a man's rights of person or property should not be seriously prejudiced by any decree without having them before the court, and affording him full 9pportunity of explanation and defense. Many adjudged cases, however, show that the general rules relating to necessary parties have been modified by exceptions founded upon considerations of convenience, neces5ity, and manifest justice. Payne v. Hook, 7 Wall. 425; Story, Eq. PI. § 96, and notes; Hotel Co. v. Wade, 97 U. S.13. Suits like this are of a local nature, and must be brought in the district where the lands are situated. This court, therefore, in this case, has jurisdiction of the subject-matter, and no other court out of this state can have concurrent jurisdiction. This court can, by ,the service oLits process, and by the constructive service of publica..;
BORSFORD V. GUDGER.
tion. bring before it citizens of any of the states, except those where the plaintiffs reside, and settle their rights by decree. It certainly would be a great hardship upon non-resident plaintiffs, in cases like this, where they seek to enforce local rights that are admitted or clearly proved, if they could not have such. rights established and secured in a United States circuit court held in the state where such lands are situated,'Mcause some defendants happened to be citizens of a territory or the District of Columbia. It is unnecessary for me to determine thisquestion, as I have already decided that the plaintiffs are hot entitled to relief on account of their gross laches, and the staleness oftheir claim. I am, however, inclined to the opinion that if they had not thus lost their right to equitable relief they could proceed against the parties properly before the court, as the absent heirs of John Love are not indispensable Theprineiple is well settled that a deed good anc;l effectual in law except for want ofregistration, and which has been lost :rag,:, istration, can he set up in a court of equity, and a decree mac;lEl :for another conveyance by the bargainor or his heirs, which will have relation back to the time of the execution of the lost deed. Austin v. King, 91 ,N. C. 286.: , ,.' The, plaintiffs in their,bill set forth such ,a state of facts that would. except.for their laches, entitle them to the equitable relief prayed forjimd such facts are admitted by the demurrer. Upon theexecution ,of t4e deed on, the 28th day of May, 1796, by John Love, the title to the land!'! was conveyed to the vendees, to be perfected by subsequent registration,. The sole object of registration, at that time, was to give notice to third parties, and did not affect the interests of the parties to the iIlStrulIl,,eni. ['he plaintiffs, therefore, by inheritance, have the legal and equitable to :the lands as the heirs at law of the vendees: and the defendants <Wrived no substantial interest in the same as the heirs at lawof the vendor, but they are liable to the equitable obligation of executing another ,deed to supply the place of the lost deed that was executed by their an.cestor. If the, plaintiffs had not slept upon their rights, and lostthern by lapse of time, they would. be entitled to proceed against the ants before the court, and have a decree affording the equitable relief prayed for. The absent heirs have no legal or equitable rights in the lands. .They could not be compelled to join in the re-execution, of an.y deed. ' If they have any contingent interests, their rights could be served and Protected in the decree. Harding Handy, 11 Wheat. 103; Etheridge v. Vemay, aupra. Let a decree be drawn dismissing the bill, with costs to defendants.
. Fll:DERA:L REPORTU.
(Circuit Court, W. D. Penn8ylvania. June 1, 1888.)
WRITS-SERVICE OF PROCESS ON ABSENT DEFENDANTS IN SUITS IN REV. ST. U. S. 176.
The specific prayers ofthe bill 'being (1) for an account oflumber, etc., taken from demised premises; (2) for da\Dages for defendant's breaches of covenant; (8) for the appointment of a receivllr of demised premises, lumber, etc.,-held. that the suit was not one within the contemplation of the act which authorizes service upon non-resident defendants wherever found in suits "to enforce any legal or equitable lien upon, or claim to, or to remove any incumbrance or lien or, cloud upon, the title to real or personal property within the district where such suit is brought. ..
In Equity. Sur motion to rescind an order on an absent defendant to appear, plead, answer, or demur, and to strike off the 6ervice thereof. B. J. Reid, for complainant. J. O. Pa1'mlee, for defendant. ACHESON, J. The order of April 21, 1888, was made by me upon an pam application, supported by the plaintiff's affidavit, beyond which I did llottbenlook. That affidavit brought the case within the terms of the act of congress which authorizes such order and service where the suit is brought "to enforce any legal or equitable lien upon, or claim to, or to remove any incumbrance or lien or cloud upon, the title to real or personal property within the district where such suit is brought." Supp. Rev. St. U. S. p. 176; Rev. St.§ 738; But upon a careful examination of the bill, 1 am persuaded that the suit is not within the scope of the statute. 'fhe first prayer of the bill is for an account of the lumber, etc., taken by the defendant from the demised premises, and a decree against him for the balance due the plaintiff. The second prayer is for a decree in favor of the plaintiff for the damages he has sustained by reason of the defendant's breaches of covenant. These are the principal prayers, . and they disclose the substantial purpose of the suit. They involve, it is plain, only the personal rights and obligations of the parties. The third prayer of the bill, indeed, is for the appointment of a receiver, but this is an auxiliary remedy, invoked as an aid to the principal relief sought. As the bill now stands, :1 do not see how the suit can be re.garded as a proceeding in tem,within the contemplation of the act. Thia has been reached after consultation with Judge MCKENNAN, and with his concurrel1<le. And now, June 1. 1888, the order upon the defendant made April 21, 1888, that he appear, etc., is rescinded, and the service thereof upon him is set aside.