Dowell v. Applegate

This was a suit brought in a state court by Daniel W. Applegate against B. F. Dowell to remove could from title to certain real estate. The trial court at first dismissed the bill on the ground that a decree of the circuit court of the United States for the district of Oregon, which was set up by defendant, was a bar to the suit. The decree of dismissal was reversed on appeal by the supreme court of the state, (16 Pac. 651,) and another hearing was had, resulting in a decree for complainant. Thereupon, defendant appealed, and the decree was affirmed. 20 Pac. 429. He then sued out this writ of error.

This case involves the title to a tract of land in Douglas county, Or., containing 40 acres, part of what is known as the 'Donation Land Claim of Jesse Applegate,' No. 38, in township 22 S., of range 5 W. of the Willamette meridian.

The defendant in error, Daniel W. Applegate, holds under a deed executed to him by William H. H. Applegate and wife, dated October 8, 1874, and recorded October 31, 1874. He brought this suit in the circuit court of Douglas county, Or., to obtain a decree removing the cloud upon his alleged title created by a deed made to the defendant, Dowell, by a master in chancery, pursuant to an order of the circuit court of the United States for the district of Oregon, in a suit determined by that court, in which Dowell was plaintiff and Daniel W. Applegate was one of the defendants. At a sale held in conformity with the final decree in that suit, Dowell became the purchaser of the land in question. That sale was duly confirmed, and a deed executed to him. From that decree of sale no appeal was taken.

Dowell bases his claim to the land upon the decree and orders in the above suit in the circuit court of the United States, and the controlling question before this court is as to the effect of that suit.

The state court did not give to the decree and orders in the federal court the effect claimed for them, and it is necessary to a clear understanding of the grounds upon which it refused to do so that we ascertain the precise nature of the proceedings in the latter court.

From the recitals in a supplemental bill filed by Dowell in the suit in the federal court, it appears that that suit was commenced on the 11th day of October, 1879, in the circuit court of Douglas county, Or., and was subsequently removed into the circuit court of the United States for the district of Oregon. Upon whose application, or upon what grounds, it was so removed, the record before us does not clearly show. But it does appear that Dowell, on the 6th day of April, 1881, in order to conform his pleadings to the practice in the courts of the United States sitting in equity, filed a bill in the federal court disclosing the grounds of his suit. The defendants were Jesse Applegate and his wife, Cynthia Ann Applegate, William H. H. Applegate, Daniel W. Applegate, Peter Applegate, Sallie Long, John C. Drain, Jonas Ellensberg, and Charles Putnam.

The bill filed by Dowell made the following case: In a suit brought on the official bond of one May, secretary of state of Oregon, executed September 6, 1862,-his sureties being Jesse Applegate, O. Jacobs, and James Kilgore,-judgment was entered, June 24, 1874, in favor of the state, for the sum of $1,622.50, and the costs, expenses, and disbursements of the action. That judgment was unsatisfied, in whole or in part, when Dowell brought his suit.

On the 4th day of August, 1874, in a suit instituted in the circuit court of Marion county, Or., against Dowell and Jesse Applegate, who were sureties on the official bond of May, dated August 4, 1866, for another term of the office of secretary of state, the state recovered judgment for the sum of $8,929.85, together with the costs, expenses, and disbursements of the action. That judgment was duly entered August 11, 1877, on the judgment lien docket of Douglas county. Prior to June 27, 1878, Dowell paid on it the sum of $10,837.75; and on that day he recovered a judgment in the circuit court of Douglas county against Jesse Applegate, as his cosurety, for the sum of $4,882.19, with costs, expenses, and disbursements. That judgment was also, and on the day of its rendition, entered on the judgment lien docket of Douglas county.

A balance of $1,385.61 due the state on its judgment was paid by Dowell November 16, 1878. He gave notice November 28, 1878, in conformity with the statutes of Oregon, that he claimed the benefit of the judgment of the state against Jesse Applegate for contribution for said sum, with costs and expenses, and that notice was duly entered of record. An execution was issued April 4, 1879, on the state's judgment, with costs, etc.; and under it the lands levied on were sold May 31, 1879, to Jesse Applegate, for upwards of $1,200. This left due to Dowell on that execution $284.61, with interest from May 31, 1879.

The amount due Dowell January 1, 1881, from Jesse Applegate, on both of the above judgments, with interest and costs, was $6,584.09. Execution was issued September 17, 1879, in his favor, for $4,882.31, and was duly returned 'No property found.' A second execution issued October 7, 1879, with a like result.

Jesse Applegate was at one time the owner in fee of the north half of a donation land claim, with a life estate in the south half, that had been set apart to his wife; such claim having been taken up in 1849 under the laws of the provisional government of Oregon, and afterwards under the act of congress approved September 27, 1850, entitled 'An act to create the office of survey-or-general of the public lands in Oregon and to provide for the survey, and to make donations to settlers, of the said public lands.' The tract of land so taken up contained 642 acres, and was known on the surveys and maps of the United States as 'Jesse Applegate's Donation Land Claim,' No. 38, in township 22. He was also the owner of other lands in Douglas county, Or.

Dowell's bill referred to deeds purporting to have been executed in 1867 and 1869 by Jesse Applegate and wife to W. H. H. Applegate, Daniel W. Applegate, Peter Applegate, Sallie Applegate, and Charles Putnam,-children and grandchildren of the grantors, for lands aggregation more than a thousand acres, a large part of which was within the above donation claim. It also referred to a deed executed June 24, 1871, by W. H. H. Applegate, conveying to Charles and John C. Drain, for $2,000 in cash paid, 200 acres in the south half of that claim.

In respect of all of the above deeds, the charge was that they were fraudulent and void as against the state of Oregon and Dowell; that the respective deeds to William H. H. Applegate and Daniel W. Applegate, dated in 1867, were antedated for the purpose of deceiving, cheating, delaying, and defrauding the state and Dowell, and were in fact not made and delivered until 1869. In respect to the deed of June 24, 1871, the charge was that the price paid by the grantee was $2,000, 'yet the deed, to conceal the value of the land, and to cheat and defraud the creditors of Jesse Applegate, and to make the price correspond with the said deed of Jesse Applegate and his wife to the said William H. H. Applegate, on its face only expresses the consideration of $500, and it, in place of having a revenue stamp of $2, as was required by the act of congress at the date of said deed, only has a revenue stamp of 50 cents on it.' Dowell's bill also averred that all of said deeds were 'illegal and a fraud, under the statute of the United States, entitled 'An act to provide internal revenue to support the government and to pay interest on the public debt,' approved 30th day of June, 1864, and the amendments thereunto; that an inadequate consideration was expressed in each of said deeds by the grantors and grantees, with the intent of evading the provisions of said statute; that the grantors and grantees well knew the land conveyed by each deed was at the date thereof worth in cash more than $1,000, and each of them have a revenue stamp on them of 50 cents, and no more,-not one-half the amount required by said act of congress,-and the recording of each of them was in violation of the spirit-meaning of sections 152, 156, and 158 of said statute; that none of said stamps have been canceled by writing the date when the deed was so used or stamps affixed on the same, and none of them have the initials of the person using them or affixing the same prior to the placing of said deed on the records of Douglas county, in the state of Oregon.'

The relief sought by Dowell was a decree declaring the above-mentioned deeds to be illegal, fraudulent, and void as to him; ordering the sale of the lands described in the bill under the judgments in favor of himself and the state; that an account be taken of the rents, issues, and profits of each tract for the six years preceding the commencement of the suit; that the grantees be compelled to pay the rents, issues, and profits on the tracts severally deeded to them; and that plaintiff have such other relief as in equity and good conscience was proper.

Daniel W. Applegate, May 2, 1881, filed an answer to Dowell's bill, putting in issue most of its material allegations, and denying that Dowell was entitled to the relief asked for in the bill. He denied that his deeds, or either of them, were 'a fraud under the statutes of the United States, or any statute relating to internal revenue,' or that the consideration was expressed in either of them with an intent to evade the provisions of that or any other statute. He admitted that each deed made to him had on it a stamp of 50 cents only, but alleged that stamps were put on each in good faith, and without any intent to evade the requirements of the statute of the United States, and that the recording of such deeds was not in violation of any law.

He made no reference in his answer to, and, so far as the record before us discloses, did not introduce in evidence, the deed for the 40 acres made in him October 8, 1874, by William H. H. Applegate, although that deed is made by his bill in the present action the foundation of his claim to that tract.

By the final decree in Dowell's suit, rendered January 5, 1883, it was adjudged that on and prior to April 19, 1869, Jesse Applegate and Dowell were jointly and severally liable to the state of Oregon in the sum of $5,546, as sureties on the official bond, of August 4, 1866, of May, secretary of state, by reason of the defalcation of that officer, which sum was equal to the value of all the property and assets then owned and possessed by Jesse Applegate; that there was due to Dowell, on the accounts mentioned in his bill, $7,488.48, for which sum, with interest, he, by virtue of his judgment obtained June 27, 1878, had a lien upon all the real property of Jesse Applegate in Douglas county from and after the entry and docketing of that judgment; that on and prior to April 19, 1869, Jesse Applegate was the owner in fee simple of 121.55 acres of the north half of the donation claim numbered 38; that 'the conveyance of said 121.55 acres by said Jesse Applegate to his sons William H. H. Applegate and Daniel W. Applegate, by deeds dated April 19 and 20, 1869, respectively, was voluntary, and without valuable consideration, and in fraud of the rights of the plaintiff herein, and is therefore, as to him and his assigns, declared to be null and void.' The decree also declared void, as against Dowell and his assigns, a deed to Peter Applegate for two tracts containing together 41.31 acres, deeds to Daniel W. Applegate and Peter Applegate for 225 acres in the south half of the above donation claim, and a deed to Sallie Applegate.

The decree further provided that unless Jesse Applegate, Peter Applegate, Daniel W. Applegate, William H. H. Applegate, and Sallie Applegate paid the sum adjudged to be due to Dowell, within a named time, the master of the court should sell, as upon execution at law, all the interest of Jesse Applegate in the above-mentioned tract of 121.55 acres, and in the lands embraced in the deeds to Peter Applegate and Sallie Applegate, containing, respectively, 41.31 and 160 acres, and that the purchaser should be entitled to the possession of the premises purchased, upon the receipt of the master's conveyance therefor. The tract in dispute is part of the tract of 121.55 acres. The bill was dismissed as to Putnam and Ellensberg.

In respect to a conveyance to William H. H. Applegate for 160 acres in the north half of the donation claim numbered 38, and the conveyances of the same date to Daniel W. Applegate of 146 acres in the south half of that claim, they were held to be valid; the court finding that they were made in good faith, and at a time when the grantor was otherwise able to meet his pecuniary obligations.

A sale took place under the decree of the federal court on the 26th of April, 1883; Dowell becoming the purchaser of the lands ordered to be sold, at the price of $7,400. The sale was in all things confirmed by the court, and the master, December 6, 1883, pursuant to its order, made and acknowledged a deed to Dowell, which was duly approved, was acknowledged March 28, 1884, and recorded August 19, 1884.

The present suit was brought by Daniel W. Applegate on the 17th day of August, 1886,-more than three years after the decree in the federal court,-for the purpose, as we have already stated, of obtaining a decree enjoining Dowell from asserting any title or claim, by virtue of the latter's deed under the decree of the federal court, to the tract of 40 acres conveyed to the plaintiff herein, by William H. H. Applegate, by deed dated October 8, 1874. The bill, admitting that that tract was embraced in the deed made by the master to Dowell, avers that the conveyance by William H. H. Applegate to Daniel W. Applegate was prior in time to the commencement of the suit in the federal court, and its validity was in no wise put in issue or determined by the decree of that court.

The answer of Dowell in the present suit, as stated at the outset, bases his claim upon the decree of the federal court, and the sale under it, at which he purchased. Referring to the deeds made by Jesse Applegate to his sons William H. H. Applegate and Daniel W. Applegate, the answer charges that they were made with the intent to cheat, delay, and defraud the state of Oregon and the defendant, and that those deeds, as well as the deed from William H. H. Applegate to Daniel W. Applegate, were without any valuable consideration whatever, and that defendant purchased the land in question without any actual notice of the latter deed. The answer further avers that the deed, under which plaintiff now claims the tract of 40 acres, was put in issue in the suit in the federal court, and was determined by the decree of that court.

The reply of Daniel W. Applegate controverts all the material allegations of Dowell's answer, and denies that the circuit court of the United States for the district of Oregon had any jurisdiction to hear and determine the suit brought by Dowell, or to render the decree under which the lands here in question were sold.

Upon the hearing of the present cause in the circuit court of Douglas county, the bill was dismissed, the court being of opinion that the decree of the federal court in the suit brought by Dowell was a bar to the present one. This decree was reversed by the supreme court of Oregon. Applegate v. Dowell, 15 Or. 513, 16 Pac 651. Upon a second trial of this cause in the court of original jurisdiction, there was a decree in favor of Daniel W. Applegate, which decree, upon the appeal of Dowell, was affirmed upon the authority of the previous decision in the supreme court of Oregon. Applegate v. Dowell, 17 Or. 299, 20 Pac. 429. Among the findings of the circuit court of Douglas county at the last trial of this case were the following: 'That no evidence was offered or admitted sustaining, or tending to sustain, the allegations in the answer of defendant [Dowell] that the plaintiff and his brother William H. H. Applegate, at the time of the deed of Jesse Applegate to William H. H. Applegate, and the pretended deed from William H. H. Applegate to plaintiff, well knew that Jesse Applegate was largely indebted to the state of Oregon as one of the sureties of S. E. May, late secretary of state, and both of said deeds were made with the intent to cheat and defraud the state of Oregon and B. F. Dowell, one of Jesse Applegate's cosureties, out of said debt; that the said William H. H. Applegate and Daniel W. Applegate received said deeds with the intent to cheat, delay, and defraud the state of Oregon and B. F. Dowell out of said debt; that both of said deeds were made and delivered to William H. H. Applegate and Daniel W. Applegate without any valuable consideration whatever; and that the deed of William H. H. Applegate to his brother Daniel W. Applegate was made and delivered without any valuable consideration whatever, or any of said allegations.' The circuit court of Douglas county, for that reason only, found those allegations, and each of them, to be untrue.

Mr. Justice Field dissenting.

John H. Mitchell and B. F. Dowell, for plaintiff in error.

J. N. Dolph, for defendant in error.

Mr. Justice HARLAN, after stating the facts in the foregoing language, delivered the opinion of the court.