Arnold v. Grimes , 2 Iowa 1 ( 1855 )

Woodwakd, J.

The first question to be determined, is that of a prior adjudication. It is said that the case of Kriechbaum v. Bridges, 1 Iowa, 14, is conclusive upon this case. The cases are very unlike. In that, the defendant knew of his defence, but neglected to prepare it; he knew he wanted a witness who was absent; he knew a certain deed was lost, and that the acknowledgment of another was defective, so that it could not be offered in evidence without further proof. Yet he did nothing to remedy these difficulties, nor to supply the want. He neither asked a continuance, nor filed a bill in chancery, whilst in the case before us, Arnold did set up the whole matter of this suit as a defence in the former action of Grimes against him. The difficulty there was, that Grimes had the legal title, and Arnold’s defence was of an equitable nature only, and the court decide against him, merely on this ground, and distinctly turn him over to a court of equity. See 2 G. Greene, 77, 86. And accordingly he is now in such a court.

We turn, then, to the inquiries which present themselves in this cause, in a court of equity. And it will be observed from the statement, that Arnold holds the senior certificate of pre-emption and the junior patent, whilst Chapman (or Grimes) holds the junior certificate and the elder patent. All of these papers, of course, cannot be valid; and it becomes necessary to ascertain which are, and which are not. In other words, it is necessary to ascertain what acts the commissioner of the land office, orother officer, can set aside, and what papers or documents of the nature of the foregoing he can annul and cancel. The first act which presents itself under this inquiry, is the cancelation, by the commissioner of the general land office, of Arnold’s certificate of purchase under his pre-emption right. Had the commissioner the authority and power to do this? If he had, had he not also the authority to cancel and set aside Chapman’s patent ? When we come to the argument, we find it asserted that there was an appeal by Chapman from the decision of the register and receiver, allowing A.’s pre-emption, and that under this, the officer had the power. Did such an appeal exist in law? And was one taken? No act of Congress is found giving such an appeal, prior to that of September 4th, 1841, which allowed an appeal to the secretary of the treasury. The prior general pre-emption laws of May 29, 1830, June 22, 1838, and June 1, 1840, contain no such provision. But "by the instructions issued upon the act of 1838, when the register and receiver decided against a claimant, and he, being desirous of it, requested in writing the opinion of the general land office, they are directed to transmit the papers and proofs. Thus far it would seem, that if the claim was rejected below, the commissioner might review it; but if the claim was allowed, and a certificate of purchase issued, no authority is yet seen for setting it aside. Besides, an appeal, as claimed, implies an adverse party. But Chapman was not then claiming a pre-emption of this land, and was not at the trial, for reason, as he says, that he was sick. "Whatever may have been the reason, it will not be contended that his absence invalidated the sale. He did, indeed, deny and afterwards resist Arnold’s right to pre-emption, but upon the ground stated to the secretary of the treasury of June 30, 1841, and above quoted. So that Chapman did not -even stand in a position to appeal. In Lytle v. The State of Arkansas, 9 How. 315, 333, the Supreme Court of the United States, in regard to this same subject, say, “ From their decision, no appeal was given.” This was under the act of 1830; and it continued the. same until that of 1841, when an appeal was given to the secretary of the treasury, by one whose claim, for a pre-emption was rejected. Finally, no appeal was taken. This is manifest from the correspondence between Chapman, Arnold, and the officers, which is made evidence.

The following facts appear from the letters, with the certificates: The certificate of purchase, issued October 10, 1840. On the 28th of October, Chapman complains to the commissioner, that he had not been able to be at the hearing, and had no opportunity of defending his claim; applies for a hearing, and to have the case sent back, and requests that the patent may not issue. In a letter of the same date, to the secretary,-he protests against a patent issuing, “because the papers are insufficient,” and says, Arnold did not make out a case entitling him to the land. In May, 1841, the commissioner answers, that the evidence adduced in support of A.’s claim “being entirely satisfactory,” and “no substantial reason being given for -a- rebearing, this office would not feel itself justified in remanding the case;” but says he will suspend the issuing of a patent a reasonable time, that C. may produce evidence showing that A.’s claim was not valid under the law. In June, 1841, C. intimates to the commissioner the existence of the deed from A, to him. In July, 1841, the commissioner answers, that the existence of such a deed was not in evidence before the officer, and says the absence of evidence “fully justified this officer in confirming -the entry made.” The same month he writes to the secretary, sending a copy of A.’s deed, and urging it as against law, and as rendering the sale void, and says, his object is not, to enable him to bid. upon A.’s improvements, but to procure his own. In July, 1841, the commissioner writes to the secretary, that no reply was made to C.’s letters of October, 1840, to the commissioner and secretary, “in consequence of the expectance of a report from the land offices, as usual in a contested case, until May 29,1841, when it was ascertained by the posting of the returns from the Burlington district, that the entry of Mr. Arnold, under the act of June 1, 1840, had been made, per certificate 7888.” He afterwards sends the matter back to the register and receiver, to take testimony on the question, whether on the 1st (10th) of June, 1840, “said deed was in full force and unxevoked; or, in other words, whether there then existed a contract or agreement by which the title Arnold might acquire, should .enure to said Chapman;” and on their asking instruction, he directs them to receive testimony showing the deed invalid, for, says he, “ if invalid, there existed no contract or agreement by which the title he could acquire should enure to the benefit of another.” In November, 1841, the testimony was taken and reported to the commissioner, who decided the matter adverse to A.; and in February, 1842, notified the register and receiver that A.’s certificate was canceled. It will be seen by the opening statement, that C. afterwards proved a pre-emption to the same lands, obtained a certificate, and in 1845, received a patent; and that in 1849, after the decree of the court canceling the deed, a patent issued; to A. declaring that to C. canceled.

There was then no appeal, but when the existence of the deed was brought to the knowledge of the commissioner, -he undertook to adjudicate the questions pertaining to it, an,d to the validity of A.’s purchase; and then listens to the action of the court, rescinds his doings, and remits the party to the legal tribunals of the country. Is not this where the government should have gone in the beginning, to set aside A.’s purchase? Was there a purchase, when payment was made, and that certificate was delivered ? And if so, could the executive departments of the government adjudicate it,, and .set it aside. Justice McLean, in Ware v. Brush, 1 McLean, 535, says: “ The register, in issuing the warrant, acted ministerially, and so did the commissioner of the general land office, in issuing the patent. They could determine no matter which settled the right between the parties. Their duties were ministerial, not judicial.” And, “ it would be against all authority and reason, to hold that the acts of a ministerial officer can fix, absolutely, the rights of the parties.” In this case, the party having the equitable right, was suffered to prevail against the holder of the patent.

In Rogers v. Brent, 5 Gil. 574, the court says,. “If the commissioner issues a patent to a person not entitled to it, either the state or federal tribunals, may inquire and determine who has the better right.” “ A title derived from the government is no better than one derived from an individual owning the fee, and must be adjudged by the same rules of law; and a fraud may as well be perpetrated in obtaining a title from the government as from an individual, and it is the duty of the court to protect the injured party against the one, as well as the other.”

In Carroll v. Stafford, 3 How. 460, the Supreme Court of the United States hold this language: “ When the land was purchased and paid for, it was no longer the property of the United States, but of the purchaser. He held it for a final certificate,- which could no more be canceled by the United States than a patent. It is true, if the land had been previously sold by the United States» or reserved from sale» the certificate might be recalled by the United States, as having been issued through mistake. In this respect, there is no difference between the certificate holder and the patentee." “ Now, lands which have been sold by the United States, can in no sense be called the property of the United States. They are no more the property of the United States than lands patented. So far as the rights of the purchasers are considered-, they are protected under the patent certificate; as fully as under the patent. Suppose the officers of the government had sold a tract of land, received the purchase money, and issued a patent certificate, can it be contended that they could sell' it again, and convey a good title? They could no more do this, than they could sell land a second time, whieh had been previously patented. When sold; the government, until the patent shall issue, holds the mere legal title for the land, in trust for the purchasers; and any second purchaser would take the land charged with the trust.”

In Stoddard v. Chambers, 2 How. 285, the plaintiff held under a patent, and the defendant partly under a New Madrid certificate, and partly under a patent issued on another similar certificate; and the court treats these alike, and says: “ It has been urged, that the first patent appropriates the land, and extinguishes all prior claims of inferior dignity. But this view is not sustainable. The issuing of a patent is a ministerial act, whieh must be performed according to law. A patent is utterly void and inoperative, which is issued for land which had been previously patented to another individual.” This language seems to be applied, as well to the land held under the certificate, as that held under the patent. That claimed under the certificate, was appropriated only by having the certificate located upon it;

In Morton v. Blankership, 5 Missouri, 346, the subject undergoes a full examination. The court says: “But had the commissioner power to vacate Haydon’s entry, to make room for Lowes ? This is a power not given the commissioner bjr the act of Congress. ' Haydon (who held a certificate only) had purchased the land and paid for it, and the executive officer of the United States had no farther control over it, unless Haydon himself had applied to have his entry changed. No person can be deprived of life, liberty, ox property, without due process of law. The proceeding by which Haydon’s entry was attempted to be vacated, was clearly not a proceeding authorized by any law of the land, and was, therefore, an attempt to deprive him of his property, without due process of law. If his title was defective, this defect, under the existing laws, could be determined only in the courts of justice of the country.” In this case, which was at law, the value given the certificate in relation to a patent, was by virtue of the state law, and our law is the same; but this point does not arise in the case at bar, which is in chancery.

In Ross v. Basland, 1 Pet. 655, a prior donation certificate held priority over a subsequent entry patent. And in Bagnell v. Broderick, 13 Pet. 450, an elder entry (or certificate), and junior patent, prevailed over an elder patent. Although the circumstances of these last two cases, differ from those in the one before us, yet it is conceived that the principle involved in them is the same, which is, that the land being onpe sold or appropriated (even though not yet patented), cannot be sold again. A junior patent, under the first entry, will overreach an elder patent under a junior conflicting entry. Where the patent has been issued, through a mistake or fraud, to an individual who was not entitled to it, a court of equity will control the right of the patentee, by compelling him to convey to the person who has the better right. See Justice McLean’s opinion in Bagnell v. Broderick, 13 Pet. 455. This is a dissenting opinion, but these views do not conflict with those of the majority, and they are in accordance with the tenor of the cases. The dissent was upon the question, whether an elder certificate could prevail against a junior patent in an action at law, in a state allowing a certificate' holder to maintain an action for possession, &c., upon his certificate. See also, Ware v. Brush, 1 McLean, 533; Miller v. Kerr, 7 Wheat. 212; Boardman v. Reed, 6 Pet. 328; Threadgill v. Pintard, 12 How. 24; Bush v. Marshall, 6 How. 284.

The same law has been held by our own court in Cavender v. Smith (Burlington, May Term, 1851). Cavender’s .grantor purchased under a judgment rendered against Smith, whilst he held only the certificate of the register of the land office, Smith -afterwards obtained a patent, and defends the •action of Oavender, brought to recover the possession, by showing the legal title to be in himself by virtue of the patent. Of Smith’s purchase by the certificate, the court say, By this purchase, he acquired all the property which the United States had in the land. There was no reservation made. The sale was unconditional; the right acquired was •absolute. All tbe equity, and in substance, the legal title, passed from the government to the purchaser, and the government retained only the formal, the merely technical, legal •title, in trust for the purchaser, until the patent issued. Having once sold the land by certificate to one, the officers of the government could not sell it again, and convey a good title to another, even by patent, &c.” And they cite and rely upon the ease of Carroll v. Stafford, 3 How. 460.

It is worthy of observation, that in the correspondence, above somewhat freely quoted, the executive officer of the government, at length refers the parties to the judicial tribunals of the country for the determination of their rights. At about this period, this department adopts the correct view, and no longer takes upon itself duties of a judicial nature. In November, 1843, the commissioner of .the general land office, under the direction of the secretary of the treasury, addresses a circular to the registers and. receivers of the local offices, advising them, that in,fixture, in adjudications upon pre-emption claims under the acts of 1838, 1840, and 1841, no examination will be had, whether the person claiming has made any contract or agreement by which the right or title which he might acquire, would enure to the benefit of any other person, &cn a false swearing as to any of them, he remarks, •being the proper subject of an examination by the judicial tribunals. This instruction harmonizes the practice of the department, with the judicial decisions.

There are two or three cases, which, on a casual obsérvation, seem to oppose the foregoing conclusion. The first is, that of Gray v. McCance, 14 Ill. 344. This was a case of conflicting pre-emption claims, and the ultimate decision of it, was upon an appeal to the secretary of the treasury, under the act of 1841, which act, we have above remarked, expressly gave such an appeal. And farther, there are some reasons in favor of a greater extent of power in the officers in a case of conflicting claims, than in an ex parte claim once acted upon. And there is certainly a great difference between such a case, and an adjudication of forfeiture, under a penal act. But, in regard to the case of the original parties, Gray and White, the only ground on which Gray and McGance can stand, is this: that a pre-emption right has been held to be property — a vested right, to some extent, See Threadgill v. Pintard, 12 How. 24; Brush v. Marshall et al., 6 How. 284; Doyle v. Knapp, 3 Scam. 337; Pierson v. David, 1 Iowa, 23. And under this view, the officers might, possibly, be sustained in taking notice of, and examining the claim of White, which was prior in time, though presented subsequently, to that of Gray; for the very ground upon which the cases cited by us proceed, is that of giving preference to the prior right. Another case is Dickinson v. Brown, 9 Sm. & Mars. 130. The leading feature of this case, in respect to the matter now in view, is, that it was an action at law, in which a certificate was contending against a patent But the court does assert the existence in the officers, of that power, which we have above negatived. They do it, however, in faint terms, without argument or authority, and upon an assumed practice, which the department or bureau has itself abandoned, at least so far as bearing upon a case like the one at bar. See Circular to the Land Officers, of Nov. 11, 1843.

Now, if titles derived from the government, possess no more sanctity than others, and if her contracts and sales are to be judged by the same rules of law, how does this case stand? Arnold held a title bond from the government, certifying that he had paid for the land, and was entitled to a deed (or patent). The vendor, by her executive officer (placing it in its strongest light), assumes to vacate this title bond, and set it aside. If this may be so done, where is the security of property ? — where is the due process of law ? — and where the law of the land ? — and for what purpose are the judicial tribunals? But it is said, that if he swears falsely, he forfeits all right and title to the land.' This is true, but who is to judge whether he has sworn falsely? He also subjects himself to the pains and penalties of perjury, but no commissioner ever assumed to inflict these penalties, and it is impossible to conceive how the commissioner could declare a forfeiture of his land, any more than he could inflict the pains of perjury. In order that he should forfeit the land, be must have sworn falsely, but what tribunal has “found,” that he has sworn falsely ? — where is the record? We conclude then, that when the government sold to Arnold, in 1840, she parted with all her power over the land; that the substantial right was in A; and that the government held the title in trust for him, and could make no further sale which would be valid, unless his purchase should first be set aside, in a proper legal proceeding; and that, Arnold having obtained a patent, this attaches in law to his original purchase, and his title is perfected.

Afurtherview, however, is presented,in this; that although the executive department of the government, may not have had authority to set aside Arnold’s purchase, and to sell to Chapman, still 'the question remains for determination, by the judicial" tribunals, whether the pre-emption of Arnold was not void, under the act of 1838. And the deed to Chapman is set up, as the fact in the way. We will examine the subject, under this view. The executive department of the government, after much conflicting action, sent the party to the judicial department. In obedience to this suggestion, he has so come. Grimes first brought him into a court of law, and there he set up his defence, consisting of the whole matter of this suit; but that court sent him into chancery, and accordingly he appears in this court. And herd the argument stands thus : Chapman says that the act of 1838 was violated by the making of the deed from Arnold to him; that A.’s pre-emption was void therefor; and that he forfeited all interest in the land. To this, the answer is, that A. instituted a suit in equity against Chapman and Grimes, in a court of competent jurisdiction, for the purpose of testing this precise question, and the decree of that court was, that the bill and exhibits are true, and that the deed be canceled, and held for naught. And this bill, thus found true, alleges that the deed was obtained by fraud and duress. This decree would seem to put an end to the question concerning the effect of the deed, and the forfeiture of the pre-emption right, in consequence of it; but counsel contend, that the deed was not canceled by the decree on account of duress, but that it was so done, in order to relieve Arnold from the covenants of warranty therein, because it was inequitable that these covenants should hang over A. when C. had acquired the title from the government. It is true, that although the commissioner had no authority to set aside the first purchase, and sell to another, yet the courts might inquire into the real rights of the parties, and therefore this part of the inquiry is important. With a view to this matter, we are asked to go behind the decree, and look into the evidence, and find there that there was no case of fraud, or duress made out — no testimony adequate to support such a decree. We can look so far back as to the bill, in order to ascertain, from that, with the decree, what the court determined, but we cannot look at the testimony, with a view of ascertaining whether there was sufficient evidence to authorize such a decree of the court. If that decree was erroneous, in this respect, there was a remedy well known, but we are not now sitting in appeal or error upon it. No ’lawyer would seriously expect us, thus to revise the judgment of another court.

But was that decree on the validity of the deed, or was it merely to get rid of the covenants impending over Arnold ? When we look at the allegations of the bill, and the finding of the court, there remains no room for doubt or argument. The bill alleges that the deed was obtained by fraud and duress, and the judgment finds the bill to be true, and decrees the deed to be canceled and held for naught. The allegations and proof of the bill meet one case, and do not meet the other, and the judgment answers to the bill. But, again: what meaning is there in the argument, that the above bill and decree were only to set aside the deed, on account of the impending covenants ? According to Chap* man’s positions in this cause, that deed was void — absolutely void — dead in the birth. This is his very argument, and he uses it to destroy Arnold’s entry. The covenants, then, in an absolutely void deed, would never harm Arnold. And, further still: Chapman having set A.’s pre-emption aside, by means of that deed, and having then himself purchased the title directly from the government, how could he ever make use of those covenants against Arnold. They would seem to be hardly of consequence enough to warrant the' costs of a suit.

Another position which is urged upon us, is this: that in the above decree, the deed is not avoided ab initio, but only in the future. Although it is not necessary to determine this point, for reasons which will appear presently, it deserves some attention. Had the decree been to set aside the deed, in respect to the covenants, it might very well be said to opérale in futuro. But as the decree was to cancel and hold for naught that deed, because it was obtained by fraud and duress, can the operation of the decree be merely a prospective one. The decree did not malee the deed void, but declared it so. If it was void, for that reason, when the judgment was rendered, it had always been so. It is said that a deed obtained by duress is voidable, not void. But if the books mean anything, it is conceived that they must mean, that such an act is void. The duress “ annuls consent;” there is no consent; there is no agreement; “void things are as no things.” And it is no answer, to say that it may be confirmed. See 2 Bac. Ab. 775; Tom. Jac. Law Dic. in titulo; 1 Bouv. Inst. 226; 2 Ib. 437, and in titulo; 8 Ib. 669; 2 Pars. on Con. 66; Story on Con., § 398, n. (1); § 400; Chit. on Con. 206; 2 Kent, 234, 453; Swan’s Treatise, 8; Worcester v. Eaton, 13 Mass. 371; 3 J. J. Marshall, 659. But if the deed was not invalid and inoperative ab initio, as to all persons, hut only from the rendition of the decree, it will make no difference as between A. and C. As to Chapman, at least, the judgment of the court would have a retroactive effect. The only doubt which could arise, would be, as to innocent third persons whose interests intervened. And this brings us to the next point made.

It is urged, finally, that Grimes is an innocent purchaser. If he toas such a purchaser, yet he must lose, if Chapman’s title had nothing to stand upon, as we are disposed to think was the case. But this case need not be placed upon that basis. The better question is, is Grimes an innocent purchaser ? 0. obtained his certificate, March 21,1848, and on the same day conveyed to Grimes ; and the latter says he was cognizant of all these early facts in the history of the case. Long before C. obtained his patent, Grimes had been made' a party to the above-mentioned suit to vacate the ■deed, and the decree therein was rendered fourteen days before the issuance of the patent to C. In point of fact, then, Grimes was a purchaser, with notice of all A.’s rights; and, in a point of lato, he stands in the same attitude: he is but Chapman himself, for he holds but as trustee for O.’s creditors. This is conceded throughout the case. Therefore, he is entitled to no. notice of anything; or rather, in truth, he has notice of everything, and he takes no better right than C. had: he is to be dealt with as Chapman. And if he bought under judgments against C. in favor of creditors of the latter, this does not help him; for those creditors had liens on no more than 0. was entitled to. Their judgments and liens, will not mend his title. Finally, Grimes standing in C.’s shoes, the rule becomes applicable to him, that, “ as between conflicting entries, the doctrine of notice is utterly discarded.” 13 Pet 454. "YYhat matters it, then, whether the decree of the District Court found the deed void ab initio, or declared it void in futuro only. It is as effective in the ■one case, as in the other, so far as Chapman is concerned, and, consequently, so far as Grimes is, also.

As to Chapman, himself, a court of chancery would have to strain its conscience, to give him relief in any event. His improvements are on the quarter section which A. sought to pre-empt. He writes to the secretary: — “ My object is not to set aside his pre-emption, in order to enable me to bid upon his improvements, but to procure my own,” &c. Already had Arnold, not desiring to take them from him, made a settlement with him,, which his own counsel calls fair, and conveyed to him the portion of land embracing those improvements., Why is he not content with this ?. Why does he not rest here ? Arnold could never set up the provisions of the statute, to annul the deed. Chapman might have rested upon that deed, perfectly,, securely. But,, instead of this, he uses this deed to defeat Arnold’s preemption,. and then turns round and pre-empts A.’s land and all his improvements. If the peremptory terms of statute law, rendered it necessary for a court of equity to allow aparticeps criminis to take such an advantage, it would be,, at least, an unwelcome duty.

• Wherefore, it is considered, that the decree of the District Court be reversed, and that a writ oí procedendo issue, directing the said court to render a decree in the above cause in conformity with this opinion.