Source: https://caselaw.findlaw.com/us-supreme-court/178/476.html
Timestamp: 2019-04-19 07:44:44+00:00

Document:
[178 U.S. 476, 477] Mr. Charles K. Jenner for appellants. [178 U.S. 476, 478] No counsel for appellee.
This case involves a claim to a tract of land, arising out of an entry made under the act of Congress of June 3d, 1878, chap. 151, entitled 'An Act for the Sale of Timber Lands in the States of California, Oregon, Nevada, and in Washington Territory,' known as the timber and stone act. 20 Stat. at L. 89, chap. 151.
The act in its 1st section provided for the sale, at a named price and in quantities not exceeding 160 acres, to any person or association of persons, of surveyed public lands in the states and territory named, not included within military, Indian, and other reservations, and which were 'valuable chiefly for timber, but unfit for cultivation.' It also provided for the sale of lands 'valuable chiefly for stone' on the same terms as timber lands.
On the 30th day of April, 1883, after having complied with the requirements of the above act, one Henry C. Hackley paid to the receiver of the land office in Olympia, Washington territory, the purchase price of the N. W. 1/4 of the N. E. 1/4 and the N. 1/2 of the N. W. 1/4 of section 13, and the S. E. 1/4 of the S. W. 1/4 of section 12, all in township 36 north, of range 3 east, Willamette meridian, in the county of Skagit, territory (now state) of Washington,-taking from the receiver what is known as the final or duplicate receipt. On the same day Hackley conveyed the tract described to Stephen S. Bailey by a sufficient deed of warranty; and on December 29th, 1887, Bailey sold, transferred, and conveyed the land to the appellants. [178 U.S. 476, 480] On August 9th, 1888, the Commissioner of the General Land Office suspended and held for cancelation the entry made by Hackley, it having been reported to that office by a special agent that the land in question was not chiefly valuable for timber, but was valuable agricultural land, and also that the entry by Hackley was made in the interest of Bailey.
On or about August 23d, 1888, the register and receiver of the local land office at Seattle caused notice of the action of the Commissioner of the General Land Office to be served upon the transferees, the notice stating in detail the fact of the entry by Hackley, and that the special agent had reported that he had made a personal examination of the land and found that it was not chiefly valuable for timber, but was valuable agricultural land, and that the entry thereof was made in the interest of Bailey and others, and not for the benefit and use of the entryman.
Within sixty days after the above notice, the transferees made a special appearance by attorneys, and moved that the proceeding be dismissed and the entry reinstated and passed to patent, upon the ground that the action of the Commissioner was in excess of any authority possessed by him or by the Land Department. That motion was denied by the Commissioner. The bill alleges that such denial was not the result of the consideration of any fact or facts, but of an erroneous opinion of the law.
Thereupon the transferees applied for a hearing in accordance with the notice given, and they stipulated with the attorney for the government that the case be consolidated with eleven other entries owned by them, and which were suspended at or about the same time by the Commissioner.
That application was granted, and a hearing was had before the local land office.
The register and receiver being divided in opinion the matter went to the Commissioner, who decided that all the land embraced in the entries before him, including the land here in question entered by Hackley, was timber land that could be entered as such under the act of June 3d, 1878; that all of the proceedings in relation to Hackley's entry were regular; that [178 U.S. 476, 481] the proof submitted on the entry was sufficient; and that the government had failed to prove thatth at entry was made in the interest of Bailey or of any other person than the entryman. It was therefore ordered by that officer that the entry in question be removed from suspension and remain intact upon the records of the Land Department, and that the patent of the United States issue therefor.
Throughout all these proceedings appellants protested that the Land Office was without jurisdiction or authority to cancel the entries of the lands that had been transferred to them.
In the course of his opinion Secretary Smith said that there was no charge, nor was there any testimony affecting the transaction between Bailey and his transferees. He also said that his interpretation of the statute did not imply that a timber-land entryman was not authorized to sell his entry at any time [178 U.S. 476, 482] that he chose after he had made his proof and received a certificate. 17 U. S. Land Dec. 468, 471, 476.
In accordance with the directions of the Secretary, the Commissioner of the General Land Office, on November 21st, 1893, ordered the cancelation of the timber-land entry of Hackley upon the records of the Land Department, and the land was held subject to entry as public land of the United States.
Thereafter Diller, the present appellee, made entry of and purchased the land in question under the above act of June 3d, 1878, and a patent therefor from the United States, bearing date October 15th, 1895, was issued to him.
On February 21st, 1896, the plaintiffs, now appellants and the transferees of Bailey, brought this suit against Diller in the circuit court of the United States for the district of Washington, northern division. The bill, after setting forth the above and other facts, alleged that the action of the Land Department in regard to the entry in question was without authority of law, and that the patent to Diller was wrongfully issued.
The relief asked was a decree holding the patent of the defendant to be a cloud upon the title of the plaintiffs, adjudging that the defendant held the title in trust for them, and requiring him to convey to them whatever title he might have obtained or acquired by virtue of such patent; that the title of the plaintiffs to the land be forever quieted against the defendant; and that such further relief be granted in the premises as might be equitable.
A demurrer to the bill having been overruled, the defendant filed both a plea and an answer. After referring to the hearing before the receiver and the register, resulting in a division of opinion between those officers, the plea recited as a defense the history of the proceedings as abovest ated, and the entry of the land and the issue of a patent to the defendant after the cancelation of Hackley's entry. The plea was overruled. In his answer the defendant questioned the good faith and sufficiency of the conveyances from Hackley to Bailey and from Bailey to the plaintiffs. A replication was filed by the plaintiffs, in which they asserted the truth and sufficiency in law of their bill, and [178 U.S. 476, 483] made a countercharge of insufficiency, untruthfulness, and uncertainty as to the defendant's answer.
Upon final hearing in the circuit court Judge Hanford held that where land had been regularly entered under the act of June 3d, 1878, it was not subject to forfeiture after it had been conveyed to a bona fide purchaser; that the opinion of the Secretary of the Interior showed that the original entry in question was canceled solely because it was deemed fraudulent, and no consideration whatever was given to the rights of the plaintiffs as bona fide purchasers; and that the evidence clearly showed that the plaintiffs were bona fide purchasers within the meaning of the act of Congress referred to. The circuit court was also of opinion that 'the case in the Land Department, after the entry had been suspended, should have been adjudicated by the board composed of the Attorney General, the Secretary of the Interior, and the Commissioner of the General Land Office, as provided by 2450 and 2451, Revised Statutes, and the Secretary of the Interior, without a determination of the board, could not lawfully cancel the entry.' A decree was therefore entered adjudging the plaintiffs to be the equitable owners in fee, and entitled to the lands described in the bill; that the patent issued to the defendant Diller for the land in question was issued improvidently and without authority of law, was a cloud upon the title of the plaintiffs, and should be removed; and that whatever title might have accrued under or through such patent was held by the defendant in trust for the use and benefit of the plaintiffs. It was further adjudged that the defendant should convey to the plaintiffs, by good and sufficient deed, whatever of title he might have acquired under and by virtue of the patent, free and clear of any and all encumbrance, within ten days from the filing of the decree, and the master was authorized to make the conveyance in the event of his failure or refusal so to do; and the title of the plaintiffs to the land was declared to be forever quieted as against the defendant. Hawley v. Diller, 75 Fed. Rep. 946.
The defendant appealed and the decree of the circuit court was reversed, with directions to dismiss the bill with costs to the defendant,- Judge Hawley delivering the opinion of the [178 U.S. 476, 484] circuit court of appeals. Diller v. Hawley, 48 U. S. App. 462, 81 Fed. Rep. 651, 26 C. C. A. 514. From that decree the plaintiffs have appealed to this court.
As shown by the above statement of the provisions of the act of June 3d, 1878 (20 Stat. at L. 89, chap. 151), known as the timber and stone act, a purchaser of the surveyed public lands in California, Nevada, Oregon, and Washington, valuable chiefly for timber, but unfit for cultivation, or valuable chiefly for stone, was required in his sworn application to state that he did not seek to purchase the same on speculation, but in good faith to appropriate it to his own exclusive use and benefit, and that he had not, directly or indirectly, made any agreement or contract with any person or persons by which the title he might acquire from the United States should inure in whole or in part to the benefit of any person except himself; and if the applicant swore falsely in the premises, he became liable to the penalties of perjury, and would forfeit the money he paid for the lands; and all right and title to the same and any grant or conveyance he may have made, 'except in the hands of bona fide purchasers,' would be null and void.
Who, within the meaning of the act, are to be deemed bona fide purchasers?Co uld the appellants, against whom, in respect of these lands, no charge of fraud was made, be deemed bona fide purchasers, if it appeared to the Land Department, before a pattent issued, that the original entryman made the application to purchase 'on speculation,' and not in good faith to appropriate the lands to his own exclusive use and benefit?
The words 'bona fide purchasers,' as applied to purchasers of public lands, did not appear for the first time in the timber and stone act of 1878. The 1st section of the act of June 22d, 1838, granting pre-emption rights to settlers on the public lands, contains substantially the same provisions as to the effect of a false oath by the applicant and the same saving for the benefit of bona fide purchasers. 5 Stat. at L. 251, chap. 119. Like provisions were made in the act of September 4th, 1841, appropriating the proceeds of the sales of the public lands, and granting pre-emption rights. 5 Stat. at L. 453, 456, chap. 16, 13. And the provisions of the last act were preserved in 2262 of the Revised Statutes. [178 U.S. 476, 485] The contention of appellants is that as between themselves and the United States they must be deemed to have been bona fide purchasers from the moment they bought in good faith from Bailey, the vendee of Hackley ( although no patent had been issued), and that, under the act, they could not be affected by the fraud of the original entryman or his assignee.
These principles were applied by the Land Department in Travelers' Ins. co. 9 U. S. Land Dec. 316, 320, 321.
Again, in United States v. Allard, 14 U. S. Land Dec. 392, 405, 406, the question was fully examined by Secretary Noble in the light of the authorities, and his conclusion was thus stated: 'A bona fide purchaser of land is one who is the purchaser of the legal title or estate; and a purchaser of a mere equity is not embraced in the definition. Boone v. Chiles, 10 Pet. 177, 9 L. ed. 388; 3 Ops. Atty. Gen. 664. This was the well-defined meaning of the term long before the enactment of the statute under consideration, and, under a well-established rule of construction, unless it is apparent that Congress intended it to have a different meaning, it is to be presumed to have been used in its technical sense. There is nothing in the present statute to indicate that Congress used the term in other than its technical sense. Indeed, it may properly be considered as having attained a technical meaning as used by Congress in previous legislation relating to the disposal of the public lands. As long ago as 1841, Attorney General Legare (3 Ops. Atty. Gen. 664) in considering a case which arose under the pre-emption act of 1838 (1 Lester, 49), involving the use of the term in that act, and the right of an assignee of a pre-emption claimant thereunder, held: 'The assignee took only an equity, and he took it, of course, subject to all prior equities. The patent, it is needless to say, is the only complete legal title under our land laws. But to protect a purchaser under the plea of a purchase for a valuable consideration without notice, he must have a complete legal title." After referring to Root v. Shields, above cited, the Secretary concluded: 'It thus appears that prior to the passge of the act under consideration (June 3d, 1878) it had been determined, both by executive construction and judicial interpretation, that the term 'bona fide purchaser,' as used in the pre-emption law, was so used in its technical sense, or with reference to its [178 U.S. 476, 488] previously known and well-defined import. It is therefore to be presumed, nothing appearing to the contrary, that Congress, in making use of the term in the timber and stone act, did so in the light of such construction, and must have intended its use in the same sense as in the pre-emption law; namely, that to be a bona fide purchaser within the protection of the statute, a party must have acquired by his purchase and the conveyance to him a complete legal title.' See also Whitaker v. Southern P. R. Co. 2 Copp's Public Lands (1882 ed.) 919, 923; Stout v. Hyatt, 13 Kan. 243, 244; Taylor v. Western, 77 Cal. 534, 540, 20 Pac. 62.
We are of opinion that the rule announced in Root v. Shields, above cited, and which has been steadily followed in the Land Department, is consistent with the words of the statute. If any doubt existed on the subject, the construction so long recognized by the Interior Department in its administration of the public lands should be not overthrown, unless a different one is plainly required-as it is not-by the words of the act. United States v. Philbrick, 120 U.S. 52, 59 , 30 S. L. ed. 559, 561, 7 Sup. Ct. Rep. 413; United States v. Johnston, 124 U.S. 236, 253 , 31 S. L. ed. 389, 396, 8 Sup. Ct. Rep. 446; United States v. Alabama G. S. R. Co. 142 U.S. 615, 621 , 35 S. L. ed. 1134, 1136, 12 Sup. Ct. Rep. 306.
The contention of appellants that they could not be affected by the fraud, if any, committed by the original entryman or his vendee, being unsound, is there any other ground upon which the court can hold that the title to these lands is held by the appellee in trust for them?
It is contended that the Land Department was without jurisdiction to cancel the original entry. The exclusion of mere speculators from purchasing the public lands referred to in the timber and stione act would be of no practical value if it were true that one, having purchased in good faith from an entryman who is proved to have sworn falsely in his application, could demand, of right, that a patent be issued to him. The Land Department has authority, at any time before a patent is issued, to inquire whether the original entry was in conformity with the act of Congress. Knight v. United States Land Asso. 142 U.S. 161 , 35 L. ed. 974, 12 Sup. Ct. Rep. 258, and Michigan Land & Lumber Co. v. Rust, 168 U.S. 589, 593 , 42 S. L. ed. 591, 592, 18 Sup. Ct. Rep. 208, and authorities cited in each case. Of course, that [178 U.S. 476, 489] Department could not arbitrarily destroy the equitable title acquired by the entryman, and held by him or his assignee. Those who hold such title have a right to be notified of and heard in any proceeding instituted in the Land Department having for its object the cancelation of the entry upon which the equitable title depends. In the present case the appellants had full notice of the proceedings before the register and receiver and before the Commissioner of the General Land Office, which resulted in the cancelation of the original entry. And we infer from the record that they had notice of the order of the Secretary of the Interior directing the papers to be sent to him for examination. The plea, referring to the action of the Commissioner of the General Land Office and of the Secretary of the Interior, distinctly stated that Hackley 'was given every opportunity to be heard before the said officers of the Land Department of the United States, likewise his said transferees, before said certificate was canceled.' The allegation in the bill on this point means only that the order of the Secretary of the Interior to send the papers to him was made without notice to Hackley and his transferees. But that is immaterial if they ad an opportunity to be hcard before the Secretary while the case was in his hands. In the summary of the points relied upon by appellants, it is not claimed that they had no such opportunity. The order of cancelation by the Secretary was based upon the fact, which he ascertained from the evidence, that the original entry of the land in dispute was not in good faith, for the exclusive benefit and use of the entryman, but for the speculative purposes of others with whom the entryman was in collusion.
It is suggested that the order of the Land Department canceling the entry was based upon a misconstruction of the law. If it had been, then the error committed could be corrected by the courts; for, as said in Sanford v. Sanford, 139 U.S. 642, 647 , 35 S. L. ed. 290, 291, 11 Sup. Ct. Rep. 666, where the matters determined by the Land Office 'are not properly before the Department, or its conclusions have been reached from a misconstruction by its officers of the law applicable to the cases before it, and it has thus denied to parties rights which, upon a correct construction, would have been [178 U.S. 476, 490] conceded to them, or where misrepresentations and fraud have been practised, necessarily affecting its judgment, then the courts can, in a proper proceeding, interfere and control its determination so as to secure the just rights of parties injuriously affected.' See also Quinby v. Conlan, 104 U.S. 420, 426 , 26 S. L. ed. 800, 802; Baldwin v. Stark, 107 U.S. 463, 465 , 27 S. L. ed. 526, 2 Sup. Ct. Rep. 473; Cornelius v. Kessel, 128 U.S. 456, 461 , 32 S. L. ed. 482, 483, 9 Sup. Ct. Rep. 122. But there was no misconstruction of the law by the Land Department. Upon the facts found no other conclusion could properly be reached than the one indicated by the opinion of the Secretary of the Interior (United States v. Bailey, 17 U. S. Land Dec. 468), namely, that the original entry of the land was in violation of the act of Congress.
One other question remains to be considered. The appellants insist that the order of the Secretary of the Interior canceling the entry of these lands could be of no legal effect without being approved by the Attorney General. This question is one of no little importance in the administration of the public lands. It has never been directly determined by this court.
Thus after June 26th, 1856, the statutes relating to the board were not applicable to every case of suspended entry, but to those specially mentioned in the act of that date. As carried into the Revised Statutes the purpose of this legislation is, where the law has been substantially complied with, to authorize the confirmation of entries which otherwise the land officers would be compelled to reject because of errors or informalities which, if satisfactorily explained as arising from ignorance, accident, or mistake, would, in the absence of an adverse claim, be excused by the courts in administering the principles of equity and justice. The purpose of the legislation was not to limit or restrict the general or ordinary jurisdiction of the land officers. It was rather to supplement that jurisdiction by authorizing them to apply the principles of equity, for the purpose of saving from rejection and cancelation a class of entries deemed meritorious by Congress, but which could not be sustained and carried to patent under existing land laws. There was no necessity for legislation authorizing the rejection or cancelation of irregular entries, but legislation was necessary to save such entries from rejection and cancelation when otherwise meritorious.
Primarily the decision and adjudication of suspended entries [178 U.S. 476, 494] is, under 2450 and 2451, as theretofore, left with the Commissioner of the General Land Office, except that he is to be guided by the principles of equity and justice and by the regulations settled by the Secretary of the Interior, the Attorney General, and the Commissioner, conjointly. The only question is whether all decisions of the Commissioner upon such suspended entries must be submitted to the Secretary of the Interior and the Attorney General, acting as a board, for approval.
If the matter rested upon 2450 and the first part of 2451, it might well be contended that a decision rejecting or canceling a suspended entry should, equally with a decision sustaining such an entry, be submitted to the board for approval. But the latter part of 2451 does not sustain that view. It is there declared that 'every such adjudication,' if approved by the board, 'shall operate only to devest the United States of the title of the lands embraced thereby.' A decision merely rejecting or canceling the entry could not, with or without the approval of the board, have the effect of devesting the United States of its title. That effect could only flow from a decision sustaining the entry, and since the effect of a decision by the Commissioner such as is required to be submitted to the board, and of an approval thereof by the board, is to devest the United States of its title, it follows that only decisions sustaining irregular entries are required to be submitte t o the board for its approval. Decisions rejecting or canceling such entries have the force and effect otherwise accorded to them by the general land laws, and are subject to the appellate or supervisory authority of the Secretary of the Interior, as in other instances.
The reasons for requiring the approval by the Secretary of the Interior and the Attorney General of decisions of the Commissioner sustaining irregular entries, under this exceptional legislation, do not apply to decisions rejecting and canceling such entries. In the one instance claims to public lands are sustained, although acquired in an irregular manner, while in the other such claims are rejected and the public title preserved.
Hackley's entry of the lands in controversy was not suspended because of any error or informality therein arising from [178 U.S. 476, 495] ignorance, accident, or mistake susceptible of explanation, but because of the charge that the same was unlawfully and speculatively made for the benefit of others, and not for his own exclusive use and benefit. The suspension was ordered with a view to an investigation and hearing upon that charge. The decision of the Commissioner sustaining the entry, following this investigation and hearing, was not therefore, rendered in pursuance of the special authority conferred upon him by 2450 to 2457 of the Revised Statutes, but under the general authority given to him, in respect of the public lands, by 441, 453, and 2478 of the Revised Statutes and by the act of June 3d, 1878, under which Hackley's entry was made.
We are of opinion that the Commissioner's decision, having been made under his general authority, and not under the exceptional authority given by 2450 to 2457, was not required to be submitted to the Secretary of the Interior and the Attorney General, acting as a board, for approval, but was subject to the appellate or supervisory authority of the Secretary of the Interior under 441, 453, and 2478 of the Revised Statutes. Knight v. United States Land Asso. 142 U.S. 161, 177 , 35 S. L. ed. 974, 979, 12 Sup. Ct. Rep. 258. It follows that the Secretary of the Interior in reversing the decision of the Commissioner of the General Land Office, and in rejecting and canceling Hackley's entry, did not exceed the jurisdiction conferred upon him by law.
The matter determined by the decision of the Secretary was whether Hackley's entry was made in good faith, for his own exclusive use and benefit. After notice, investigation, and hearing, the Secretary of the Interior determined that question against Hackley. In the absence of a charge that this decision was fraudulently given or obtained,-and no such charge is made,-the Secretary's determination of this question of fact is conclusive upon the courts. This is established by repeated decisions. And if the charge against Hackley's entry be considered as one of fraud, involving a mixed question of fact and law, still the decision of the Secretary of the Interior canceling that entry fully states the evidence or facts from which the fraud was held by him to be deducible as a matter of law. Upon an examination of that decision and of the evidence or facts [178 U.S. 476, 496] therein recited we are not prepared to hold that any error of law was committed by that officer.
This disposes of all the questions in the case that need be noticed, and the decree below is affirmed.

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