Those only who have a clear, legal, and equitable title to land,
connected with possession, have a right to claim the interference
of a court of equity to give them peace or dissipate a cloud on the
title.
Therefore, where the complainant was the volunteer purchaser of
a litigious claim, was the assignee of a secret equity for
apparently a mere nominal consideration and of the bare legal title
for a like consideration, and this legal title assigned to him
during the pendency of a suit in chancery in a state court to
ascertain the person justly entitled to it, it was error in the
court below to grant to such complainant a perpetual
injunction.
The courts of the United States should not entertain a bill of
peace upon a title in litigation in a state court.
The facts are stated in the opinion of the Court.
MR. JUSTICE GRIER delivered the opinion of the Court.
The bill in this case is in the nature of a "bill of peace," as
authorized by the statutes of Wisconsin. Smith, the claimant below,
claimed to be owner of certain lands to which Orton claimed also to
have some title. The bill prays an injunction against Orton to
prohibit him from setting up his claim and thereby "casting a
cloud" over the good legal title of complainant.
The facts of the case are somewhat complex, and its merits will
be better apprehended by a succinct history of them as elicited
from the pleadings and evidence.
Hubbard had settled in Wisconsin, having escaped from his
creditors, with some pecuniary means which he thought it prudent to
conceal. Hence, though he speculated in the purchase and sale of
lands, the title to them was held by friends. He had contracted to
sell certain lots in Milwaukee to Schram.
Page 59 U. S. 264
But Schram would not pay his money without a good legal title,
or good security that it should be conveyed to him. Hubbard resided
in the family of his friend Butler, and being addicted to idleness
and intemperance, he confided the management of his affairs in a
great measure to Butler. Schram would not pay his money on the
security of Butler or the promise of Hubbard to obtain a title, and
one Knab at length was prevailed on to enter into a bond with
Butler conditioned that a good legal title should be made to Schram
for the lots. But Knab was unwilling to enter into this bond
without security also. For this purpose the land in dispute in this
suit was conveyed to him in fee by one Cyrus D. Davis, who held the
legal title as friend and trustee of Hubbard. This deed was put on
record by Knab, who at the same time gave his title bond
covenanting to convey the land to Butler when the covenants of
their bond to Schram would be satisfied or released. This title
bond was not given to Davis, because he claimed no beneficial
interest in the land, nor to Hubbard, because his policy required
him not to appear to have any title to property, but to Butler, the
friend and active agent of Hubbard. Notwithstanding the testimony
of Butler, that he paid Hubbard for the land and did not hold as
secret trustee for him, the fact may be considered doubtful, and it
is not necessary to decide it in our view of the present case.
Hubbard is now deceased, but in his lifetime he assigned, for the
consideration of one dollar, all his interest in the land in
dispute to one Gruenhagen, under whom Smith, the complainant,
claims by deed dated in June, 1851.
On the 22d of February, 1851, Butler assigned to Orton, the
defendant, the title bond of Knab for the consideration of $2,100.
This consideration has been paid without any knowledge or notice of
any secret equity in Hubbard; and the covenants of the bond to
Schram being fulfilled or released, Orton filed his bill in
chancery on the 6th of August, 1851, against Knab, demanding from
him a conveyance of the legal title according to the exigency of
his bond.
During the pendency of this bill, which would settle the legal
and equitable rights of all persons having any claim to the land in
dispute, the complainant, Smith, becomes the purchased of the real
or supposed secret equity of Hubbard. And not only so, but he has
obtained from Knab the transfer of the legal title for a nominal
consideration, thereby substituting himself in the place of Knab in
the contest pending in the state court. The charge of fraud made in
the bill, because Knab's title bond was made to Butler and not to
Hubbard, is not substantiated. It was a matter of indifference to
Knab whether Hubbard or Butler
Page 59 U. S. 265
held the bond. He had no concern with the private arrangements
or secret trusts between them. When the condition of his bond to
Schram was released, Knab was bound to convey to Butler, by the
exigency of his own contract, and could not make himself a judge of
the equities between Butler and Hubbard. His assignment to Smith,
under the circumstances, could have no effect but to substitute
Smith in his own place, under the same liabilities.
On this state of the facts the court below decreed the title to
the land to be in Smith.
"And further, that the said defendant, John J. Orton, be, and
hereby is, perpetually enjoined and forever barred from setting up
or asserting any claim in or right to said premises, by virtue of
or upon said bond and assignment. But this injunction and decree
are not in any way to affect of operate against him, the said John
J. Orton, in the prosecution of a bill pending in the circuit Court
of Milwaukee county, in this state, wherein he is complainant, and
David Knab is defendant, this Court not intending to enjoin a
proceeding in the state court."
We think the court erred in entering such a decree. Those only
who have a clear, legal, and equitable title to land connected with
possession, have any right to claim the interference of a court of
equity to give them peace or dissipate a cloud on the title.
The complainant in this case is the volunteer purchaser of a
litigious claim; he is the assignee of a secret equity for
apparently a mere nominal consideration, and of the bare legal
title for a like consideration. This legal title was improperly
assigned to him, during the pendency of a suit in chancery to
ascertain the person justly entitled to it.
Besides, the decree in this case demonstrates the impropriety of
the interference of the court of the United States, and of its
entertaining jurisdiction of a question of title then pending in
the state court. It is true, if this were an ejectment in a court
of law, the pendency of another ejectment between the same parties
might not have afforded sufficient ground for a plea of
auter
action pendent; nor would the court have been bound, even by
comity, to await the decision of the state court, or suffer the
cause pending before them to be in any way affected by it. But a
decree of a court of chancery, on a bill of peace, must necessarily
operate by way of estoppel, as to the title of the land, and
conclude all the parties to it, because it should put an end to all
litigation between them. If they have suits pending in other
courts, on the same question of title, they must cease. This bill
acts by injunction on the party -- no injunction ever goes to the
court having a concurrent jurisdiction
Page 59 U. S. 266
of the question. The courts of the United States have no such
power over suitors in a state court. But a decree on a bill of
peace which does not put an end to litigation is a mere
brutum
fulmen. Unless the court can make a decree which it can
execute, it is a sufficient reason for refusing to take cognizance
of the case. It is a rule absolutely necessary to be observed by
courts who have a concurrent jurisdiction, that in all cases
"where the jurisdiction of a court and the right of a plaintiff
to prosecute his suit in it have once attached, that right cannot
be arrested or taken away by proceedings in another court."
This rule, it is said,
"has its foundation not merely in comity, but in necessity. If
one may enjoin, the other may retort by injunction, and thus the
parties be without remedy."
See Peck v.
Jenness, 7 How. 625;
Taylor v. Royal
Saxon, 1 Wall.Jr. 311.
If the decree in this case can be of any value whatever, let us
look at the consequences which may possibly and probably will
arise, in case it is enforced.
Orton, claiming as the
bona fide assignee and purchaser
of the title bond given by Knab, has a bill pending in the state
court to compel a transfer of the legal title. Pending this
litigation, Knab assigns the legal title to a citizen of another
state, who comes into the court of the United States praying an
injunction against Orton from setting up his title. Suppose the
state court decrees the title to be in Orton, and compels Knab and
Smith, his assignee, to release the legal title to him? Now the
court below has made a decree that enjoins Orton from ever setting
up his title against Smith. It is true the decree protests against
interference with proceedings in a state court, but unless it is
construed so as to be a perfect
"felo de se," it must be
enforced in favor of complainant somehow. When the sheriff puts
Orton in possession under the decree of the state court, and expels
Smith, the circuit court, by its officer, must replace Smith or
imprison Orton for a contempt. This would indeed be a humiliating
spectacle. Such a disreputable collision of jurisdictions should be
sedulously avoided. This can only be done by refusing to entertain
a bill of peace for an injunction when the title is in litigation
in a court of concurrent jurisdiction; otherwise the result of a
bill of peace may be not peace, but war, and instead of dispelling
a "cloud" from the title of either party, will doubly increase the
darkness and difficulty with which it was environed.
Decree of the circuit court is therefore reversed, and the
bill dismissed with costs -- but without prejudice.