Peper v. Fordyce

From the record in this case it appears that on the tenth of January, 1881, Walter A. Moore, a citizen of Arkansas, conveyed to George G. Latta, a citizen of the same state, certain property in the city of Hot Springs, in trust to secure the payment of three notes for the sum of $2,433.46 each, payable to the order of Charles G. Peper, under the name of Charles G. Peper & Co., a citizen of Missouri, with power of sale in case of non-payment. After the execution of this conveyance Moore became insolvent, and assigned his property to Samuel W. Fordyce, a citizen of Arkansas, for the benefit of his creditors. On the eleventh of June, 1881, Fordyce, as such assignee, at the instance of the creditors of Moore and in their behalf, began a suit in equity in the circuit court of the United States for the Eastern district of Arkansas against Peper and Latta, the object and purpose of which was to prevent a sale of the property under the deed to Latta, and for an account of certain transactions between Peper and Moore connected with the notes which had been secured, with a view to the cancellation of the debt, or at least its payment after the exact amount due should be determined. In the bill it appeared that both Fordyce and Latta were citizens of Arkansas, and that Peper was a citizen of Missouri. To this bill Peper and Latta filed a joint answer.

Afterwards, on the thirty-first of October, 1881, Fordyce, as assignee, and Moore, began another suit against Peper and Latta in the circuit court of Garland county, Arkansas, the object of which was also to enjoin Peper and Latta from selling the property under the deed to Latta, nd to obtain a cancellation of the conveyance. Immediately on the filing of this bill, a preliminary injunction was granted as prayed. On the same day, Peper and Latta filed a petition for the removal of this last suit to the circuit court of the United States for the Eastern district of Arkansas, on the ground that 'there is a controversy in this suit between citizens of different states, and which can be fully determined between them.' In their petition it was stated in express terms that Latta, Fordyce, and Moore were all citizens of Arkansas, and Peper a citizen of Missouri. This cause was entered in due form in the circuit court of the United States on the fourteenth of November, 1881, and on the twenty-first of the same month Peper and Latta filed in that court a joint answer to the bill which had been filed in the state court, and on which the injunction had been granted. On the twentieth of December, 1881, the two causes thus in the circuit court of the United States were there consolidated on motion of Fordyce, and an order made 'that the two causes be tried as one suit under the title' of the cause originally begun in that court.

On the tenth of June, 1882, Peper and Latta filed a cross-bill in which they prayed a foreclosure and sale of the trust property. To this cross-bill an answer was filed by Fordyce and Moore, setting up substantially the same defenses as were shown in the bill of Fordyce in the circuit court of the United States, and to this a replication was filed by Peper and Latta. Testimony was taken, and on the final hearing of the cause a decree was entered dismissing the cross-bill, and directing a cancellation of the deed of trust. From that decree Peper and Latta took this appeal.

Henry Hitchcock, for appellants, Peper and another.

E. W. Kimball, for appellees, Fordyce, Assignee, etc., and another.

WAITE, C. J.