85 F. 243 -

SHEAV. LEIST.

243

tions to the master's report, sustained the same, overruling the master, and finding that the five Eclipse hay presses did pass by the trust deed, and therefore the mortgage executed by. Dupree to the intervener was invalid. Weare called on, therefore, to determine here the correctness of this decision of the circuit court. We are of opinion that these hay presses did pass by the trust deed to Birkhead, and that Finks, as receiver, properly took possession of them. In addition to the weight that we are inclined to give to the judgment of the circuit court, determir!-ing the issue here as a question of fact, we agree with him in his conclusion on the facts. We reach this conclusion for two reasons: -1. It was the evident purpose of Dupree to convey all of his property, of every kind, by the tt'nst deed, certainly all of his goods, wares, and merchandise; and he himself testified that these hay presses were part of his stock. 2: If these hay presses were not referred to by the language in the clause of the trust deed above quoted, "in the back yard of storehouse number 108," then no effect whatever can be given to that language in the deed. Dupree knew his oWn premises, and must have had something in mind when he had this expression inserted in the trust deed; and, as the evidence shows, in what was strictly his back ;yard, in the rear 'of No. 108, no g!rods were stored, these presses, in the open space just across the alley, and 50 feet from it, must, we think, have been referred to. . , . Entertaining this view of the case, it is unnecessary to consider the question as to whether the note secured by intervener's mortgage was properly admitted in evidence. Across the face of the note was stamped, "Paid. Preston National Bank." Finding against the intervener as to the validity and lien of its mortgage, we need only remark that an entry of this kind on the face of a note offered in evidence as the basis for a recovery should be very fully ex:plained. In our opinion, the judgment of the circuit court sustaining the exceptions to the master's report, and :linding against the intervener, was correct, and the judgment is therefore affirmed.

SHEA et al. v. LEISY.

(CIrcuIt Court. W. D. Pennsylvania.

PAROL EVIDENCE-REFORMATION OF CONTRACTS.

February 8, 1898.)

Complainants gave a bond and mortgage conditioned for the-payment In four years of $5,042, with interest. After; the mortgage was due, they filed a bill to enjoin its foreclosure, and for reformation, setting up a contemporaneous parol. agreement by . the mortgagee to cancel the mortgage on payment of $4;600, without Interest, if complaipants continued to purchase from him at marketpl'lces the beer necessary to supply their tavern. Held. that, in the absence of any showing of fraud, accident, or mistake, this matter came within the rule:excluding parol evidence to vary, etc., a written contract. . .

This was a bill ineqUity by John Shea and Daniel Shea against Dina Leisy to enjoin the proseclltion of a scire facias upon a mortgage, and

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85 FEDERAL,REPORTER.

to reform -the mortgage and bond in accordance with an alleged par,ol agreement.. .C. O. Dickey, for complainants. E. G. Ferguson, for defendant. ACHESON, Circuit Judge. The bill sets forth that on May 26, 1893, the complainants executed and delivered to Isaac Leisy their bond and mortgage in the penal sum of $10,084, conditioned for the payment to the latter of "the just sum of $5,042," within four years, with interest payable semiannually; that the complainants and Isaac Leisy "made a parol agreement contemporaneous with the said bond and mortgage," whereby it was agreed that if the complainants, who were then licensed tavern keepers and customers of Isaac Leisy, who was a brewer of beer, would continue to purchase from him (Leisy) the necessary supplies of beer for their tavern at the ordinary market prices, he (Leisy), upon payment to him of the sum of $4,600 without interest, would surrender said bond and satisfy said mortgage. And the bill alleges that the complainants gave the bond and mortg-age on the faith of this parol agreement, without which they would not have been executed; that they complied with the parol agreement in respect to the purchase of beer; and that they had tendered the sum of $4,600 to the defendant, who is the holder of the bond and mortgage, she having acquired title thereto as legatee under the will of Isaac Leisy, who is now deceased. The bill prays for an injunction against the defendher from prosecuting a writ of scire facias upon the mortant to gage which she had sued out of this court, and from bringing suit on the bond; that the bond and mortgage be reformed so as to express "the true, actual, and whole contract" between the parties thereto; and that the defendant be decreed to surrender the bond, and enter record satisfaction of the mortgage. The answer denies the making of the alleged parol contract; avers that there was no agreement or understanding whatever between the complainants and Isaac Leisy other than thatshown by and expressed in the bond and mortgage; and sets up as a defense that the matters alleged in the .bill are at variance with the terms of the written instruments. The answer further avers that the consideration of the bond and mortgage was a loan of money previously made by Isaac Leisy to the complainants, with accrued interest. The evidence on both sides conclusively shows that the indebtedness of $5,042, mentioned in the bond and mortg-age, and secured thereby, consisted of a loan of $4,600 made by Isaac Leisy to the complainants in the year 1891, with lawful interest thereon (viz. $442) from the time of the loan to the, date of the bond and mortgage. All the evidence to sustain the nllegations of the bill touching the alleged parol agreement was taken under objection. As to what occurred at the time the bond and mortgage were given, the principal witnesses are Daniel Shea, one of the complainants, on the one side, and M. J. Steel, the agent of Isaac Leisy, on the other side. These two witnesses differ materially; and, taking the proofs as a whole, it is open to grave doubt whether the evidence to make out the alleged agreement is of that clear, unequivocal, and convincing cl;1aracter to move a court of equity to reform a written in-

SHEA V. LEISY.

245

strument for fraud or mistake in its execution. U. S. v. BU<1d, 144 U. S. 154, 12 Sup. Ct. 575. But, aside from the question of the sufficiency of the.evidence, the alleged parol contract alters, in essential particulars, the written agreement of the parties, and adds to their written stipulations. Now, there can be no pretense that there was any fraud, accident, or mistake in the execution of the bond and mortgage. Nothing was inserted therein or omitted therefrom fraudulently or inadvertently. It clearly appears that the contents of these papers were fully known to and understood by the complainants when they executed them. The complainants rely altogether upon an alleged contemporary parol contract, which they seek to make a part of the transaction, and thus to materially change the terms of the written instruments. The bill proceeds upon the theory that the written instruments and the contemporaneous parol agreement together constitute the contract, and reformation accordingly of the writings is prayed. It has been, however, uniformly held by the supreme court of the United States that, unless there is fraud, accident, or mistake, it must be conclusively presumed that the written contract contains the whole engagement of the parties. Brown v. Spofford, 95 U. S. 474; Bast v. Bank, 101 U. S. 93. The rule is the same in equity as at law, and, in the absence of fraud, accident, or mistake, parol evidence of a contemporaneous oral agreement is not permitted by a court of equitv to vary, qualify, or contradict, or add to or subtract from, the terms of a written contract. Forsyth v. Kimball, 91 U. S. 291; Richardson v. Hardwick, l()6 U. S. 252, 254, 1 Sup. Ct. 213. This being a suit in equity, the last-cited decisions are conclusive against the complainants, even if a different rule prevailed in the courts of Pennsylvania. Russell v. Southard, 12 How. 139, 147. But no Pennsylvania case, so far as I am aware, permits an oral contract made at the same time with a written contract und.er seal, and purposely omitted therefrom, to be set up to contradict and destroy it. Irvin v. Irvin, 142 Pa. St. 271, 287, 21 Atl. 816. In Bast v. Bank, supra, Chief Justice Waite, speaking for the supreme court of the United States, said:
"It is not always easy to determine when, in Pennsylvania, parol evidence is admissible to explain a written instrument; but in Anspach v. Bast, 52 Pa. st. 356, it is expressly declared that 'no case goes to the length of ruling that such evidence is admitted to change the promise itself, without proof or eveli allegation of fraud or mistake. The has been repeatedly decided.' To the same effect is the ease of Hacker v. Refining Co., 73 Pa. St. 93, as well as many other cases that might be cited."

The still later decisions of the supreme court of Pennsylvania have strictly enforced the rule that where parties have deliberately put their engagements in writing, without fraud, accident, or mistake in the execution thereof, the writing is the only evidence of their agrf'ement, and its terms cannot be added to or subtracted from by parol evidence. Hunter v. McHose, 100 Pa. St. 38; Irvin v. Irvin, 142 Pa. St. 271, 21 Atl.816; Wodock v. Robinson, 148 Pa. 81. 503, 506, 24 Atl. 73. In Hunter v. McHose, supra, the offer to show that the defendant would not have signed the agreement except for the contemporary. verbal understanding was treated as inadmissible; and, most plainly, if such an allegation opens the door for parol evidence, the salutary rule which

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85 FEDERAL REPORTER.

is· intended to preserve the sanctity of written contracts would be. eluded without difficulty, and practically abrogated. Let a, decree be drawn dismissing the bill of complaint, with costs.

i:

SAYERS et al. v. BURKHARDT et al. Court of Appeals, Fourth Circuit. No. 222. February 1, 1898.)

1.

EQ,UITY JURISDICTION CLOUD: lI'ROM TrrT.E.

BETTING ASIDE FRAUDULENT DECREE -

REMOVING

Where the purpose ofa bill is to set aside as fraudulent judicial proceedings, to declare deeds made in pursuance thereof null and void, and to free complain. ants' labds from the lien of certain taxes, and of the claim of forfeiture declareU 'In such· proceedings, it is not necessary to allege that.complalnants In possession of the lands at the ti1lle of instituting the suit, to give a court of equity jurisdiction.

2. ENTRY OR LANDS FOR TAXA'l'ION - FORFEITUItE OF LANDS BOLD FOIt TAXES.

Where lands have been purchased by the state at tax sale, they cannot be forfeIted for nonentry on the land books for taxation, under the statute of West Virginia, which provides that lands so sold shall not there,after be entered f(>l' taxl1-tion unless redeemed. ,

A suit to set aside a because of conspiracy and fraud in procuring it need not be brought in the court which rendered the decree, but may be Instituted in any court having jurisdiction :of the subject-matter; and the parties. 4. BUIT TO SE'l' ASIDE JUDICIAL SALE-LANDS FoRFEITED-LACHES. Oomplalnants' lands were sold as forfeited for nonentry for taxation in October,l885, and bilI.to set aside the proceedings as fraudulent was filed in Decernbel,", 1889. They .had never abandoned their claim to the land, but continued to assert it. It was not shown that defendants had taken possession of, or exerCised acts of ownership over, any part of the land. Held., that there :was no. laches.

8.

SUIT;T08ET ASIDE DECREE OBTAINED :BY. FRAUD-JUItJSDTCTION.

the Circuit Court of the United States for the District 1Virginia. T. W. Chapman and Okey Johnson, for appellants. P. W.,Strother and Malcolm Johnson, for appellees. Before GOFF and SIMONTON, Circuit Judges, and BRAWLEY, District Judge. of GOFF, Circuit Judge. This is an appeal from a decree rendered on the 1st of September, 1896, by the circuit court of the United States for,tbe district of West 1Virginia, by which it was held that the complainants below had title to the 17,850 acres of land mentioned in their bill; that the proceedings referred to therein, instituted court of McDowell courity, W. 1Va., by the defendant H. C. Auvil, as commissioner of school lands for that county, against a tract Of 320,000 acres of land granted by the commonwealth of 1Virginia to"Robert by patent dated March 4, 1795 (and against Jthe lands or,the complainants), were null and void; and also that the deeds made nnder .certain decrees entered in said proceedings were clo11;dsnpon the title to complainants' land, which should b{' and Jremoved,because such conveyances were void and inop-