Court Opinion

ID: 8841738
Source: CourtListenerOpinion
Date Created: 2022-11-26 16:44:06.506033+00
Date Added: 2024-06-11T17:05:13.571954
License: Public Domain

Mitchell, J.,
dissenting, with whom concurred
Barry, J., said:
“1 concur in the conclusion that, under the facts of this ease, the legal existence of the municipal court of Mankato cannot be attacked collaterally in this action, but only by direct proceeding for that purpose; and this, as I.understand' it,- is, -strictly speaking, the only matter properly before us at this time.”
The two judges dissenting refused to adopt the doctrine of a & facto court.; Burt v. Railroad Co., 31 Minn. 472, 18 N. W. Rep. 285, 289.
*169Tims stands the law as interpreted by the supreme court of the state of Minnesota, so far as the same has been called to my attention. These decisions are to the effect that an apparent statute, regularly authenticated by the signature of the presiding officer of each house, approved by the executive, and printed and promulgated with the other session laws, is presumed to be valid, but the presumption is not conclusive; it may be overthrown by reference to the journals as evidence in a direct proceeding, but not when the attack is made collaterally. Upon that presumption rest all the judgments and determinations of the court in question. Thus by the adjudication of the supreme court of the state of Minnesota a rule of property and evidence has been established in all cases applicable. Title to real and personal property fixed and determined by the judgments of that court rest secure upon the decisions of the state. Is it the duty of this court, administering justice in the same state, to follow and respect the decisions of that court in this regard, or must we hold, in accordance with the contention of the plaintiff, that the statute was not constitutionally passed; that the judgment on which this title rests, and may rest securely under the laws of the state where the property is situated, is absolutely void; that the learned judge who presided in that court and adorned the bench during the years of its existence was a mere intruder; that the act in question, bearing upon its face all the indicia of its validity, created no office; that the judgments and decrees of that court are entitled to no respect, and are, in legal effect, as inoperative as though they had never been rendered; that they establish no rights and afford no protection? Independent of all precedent or judicial interpretations of the laws of congress, I could not give my consent to such a doctrine. The spirit and reason, if not the letter, of section 721 and section 914 of the Revised Statutes of the" United States are opposed to the contention. But there is ample authority to sustain the position of the learned counsel for the defendant that it is the duty of this court in this case to follow the rule laid down by the supreme court of the state.
In Hinde v. Vattier’s Lessee, 5 Pet. 398, the supreme court of the United States held that the circuit court of the United States sitting in Ohio rightly followed the rule of evidence as laid down by the courts of the state of Ohio, wherein the state court held that the land laws of Ohio, published by authority of that state, were admissible in evidence to prove the grant from the United States to one John C. Summes and his associates. The court, speaking through Baldwin, J., says:
“There is no principle better established and more uniformly adhered to in this court than that the circuit courts, in deciding ontitles to real property, are bound to decide precisely as the state courts ought to do; citing Wilkinson v. Leland, 2 Pet. 656. The rules of property and of evidence, whether derived from the laws or adjudications of the judicial tribunals of a state, furnish the guides and rules of decision in those of the Union, in all cases to which they apply, where the constitution, treaties, or statutes of the United States do not otherwise provide.”
The federal courts follow the latest settled adjudication of the supreme court of the state, relating to rules of property and matters of a local character. Myrick v. Heard, 31 Fed. Rep. 241.
*170In an action of ejectment in the circuit court of the United States sitting in the state of Pennsylvania, (Clement v. Packer, 125 U. S. 309, 8 Sup. Ct. Rep. 907,) which involved a question concerning the location of the boundary of a private estate, the rule of evidence respecting the admission of the declarations of deceased persons, touching the disputed boundary, which had been laid down by the highest court of that state, is the rule which was held to govern the United States court in that case. The court, speaking through Justice Lamar, said:
“The limitations upon this extension of the original rule are different in different states. We do not deem it necessary in the present case to lay down any definite rule applicable to all cases as to when declarations of deceased persons constitute valid evidence to establish private boundaries. The question is one involving the ownership of real property in Pennsylvania, and it becomes our duty to ascertain the rule established in that state, especially as respects the admissibility of the declarations of deceased surveyors in cases of boundaries between private estates.”
The supreme court had adopted a different rule as to the admissibility of this class of evidence, as appears in Hunnicutt v. Peyton, 102 U. S. 333, and Ellicott v. Pearl, 10 Pet. 412, and relied upon to sustain the rejection of the evidence in that case; but the court said: “As the question is one of Pennsylvania law, to be controlled by Pennsylvania decisions, the observations of the court in these cases cited are not pertinent.”
In Town of South Ottawa v. Perkins, 94 U. S. 260, it appears from the opinion of the court that in consideration of the constitutional provisions the supreme court of Illinois had held that it was necessary to the validity of a statute that it should appear by the legislative journals that it was duly passed in the manner required by the constitution. Justice Bradley, referring to that case, on page 277, said:
“It follows that the court below, on retrying the case, must itself be satisfied whether the law in question was or was not constitutionally passed, and the vote entered on the journals, and instruct the jury accordingly. The evidence or means of ascertaining this fact must be such as is legally applicable to such a case, according to the laws of Illinois. ”
In Burgess v. Seligman, 107 U. S. 20, 2 Sup. Ct. Rep. 10, the court, speaking through Justice Bradley, said:
“The existence of two co-ordinate jurisdictions in the same territory is peculiar, and the results would be anomalous and inconvenient but for the exercise of mutual respect and deference. Since the ordinary administration of the law is carried on by the state courts, it necessarily happens that by the course of their decisions certain rules are established which become rules of property and action in the state, and have all the effects of law, and which it would be wrong to disturb. This is especially true with regard to the, law of real estate, and the construction of state constitutions and statutes. Such established rules are always regarded by the federal courts, no less than by the state courts themselves, as authoritative declarations of what the law is.”
In Gormley v. Clark, 134 U. S. 338, 348, 10 Sup. Ct. Rep. 554, the court, speaking through Chief Justice Fuller, said:
“Upon the construction of the constitution and laws of a state, this court, as a general rule, follows the decisions of her highest court, unless they conflict with or'impair the efficacy of some provision of a federal constitution ,or of a federal statute, or a rule of general commercial law; citing Norton v. *171Shelby Co., 118 U. S. 425, 6 Sup. Ct. Rep. 1121. And this is so where a course of those decisions, whether founded on statutes or not, have become rules of property within the state; also in regard to rules of evidence in actions at Jaw; and also in reference to the common law of the state, and its laws and customs of a local character, when established by repeated decisions.”
In Railroad Tax Cases, 13 Fed. Rep. 767, Justice Field, giving the opinion, says:
“Under the decisions of the courts upon constitutional provisions in all respects similar to that in the present constitution of California, it is settled that the court, to inform itself, will look to the journals of the legislature. ”
So the supreme court of the United States holds where it is so decided by the state courts in construing their own constitution and laws. On general principles, the question as to the existence or non-existence of a statute is a judicial one, and, though framed as an issue of fact, must, when it arises in the courts of the United States, be decided by them on evidence legally applicable under the laws of the state, without the advice of a jury on the subject. Town of South Ottawa v. Perkins, 94 U. S. 261; Sherman v. Story, 30 Cal. 253-277; Gardner v. Collector, 6 Wall. 509; Post v. Supervisors, 105 U. S. 667. On page 267, Town of South Ottawa v. Perkins, supra, Justice Bradley uses this language:
“It would be a very unseemly state of things, after the courts of Illinois have determined that a pretended statute of that state is not such, having never been constitutionally passed, for the courts of the United States, with the same evidence before them, to hold otherwise.”
Applying these remarks to the facts of this case, it seems to me that it would be an unseemly state of things, alter the courts of the state of Minnesota have held that it would not resort to the journals as evidence or otherwise, to see if the law creating a court of general jurisdiction had been constitutionally passed in a collateral proceeding, for this court, sitting and administering justice in the same state, to hold directly to the contrary, and overturn all the judgments of the court in question, and disturb the rules of property and of action fixed and determined by that court.
Applying the principles enunciated in the foregoing cited cases, the conclusion seems irresistible that it is the duty of this court, upon the conceded facts of this case, on this collateral attack, to follow the rule laid down in Burt v. Railroad Co., supra, in so far as that court holds that it will not look to the journals as evidence for the purpose of whether or not the statute in question was constitutionally passed. I do not think the rule laid down in Norton v. Shelby Co., 118 U. S. 425, 6 Sup. Ct. Rep. 1121, so far as the facts and conclusions are applicable to the conceded facts in the case at bar, is inconsistent with the foregoing conclusions. As was well said by the counsel for the defendant in this case in his brief:
“What is really decided in the case of Norton v. Shelby Co. is that the federal court is bound by the decisions of the state court, holding that the act of the Tennessee legislature, which assumed to create a certain board of county commissioners, was in conflict with the state constitution. What is said be*172yond that is said solely with reference to the facts of the pending cases, and should not be strained to cover an entirely different case. A distinction is also to be made between an act which, like that considered in tbs Norton Case, shows its infirmity upon its face, and one like that now before the court, which, if void at all, is so because of extrinsic facts connected with the history of its passage through the legislature. If the act now in question had assumed, for instance, to establish a court having revisory powers over the supreme court, its unconstitutionality would have been apparent, as a mere matter of legal interpretation. All men are presumed to know the law, but certainly no man is presumed to know the facts as to the number of votes cast in the legislature for or against a particular bill. Questions of this kind are questions of evidence, as to the effect of which courts might differ. The act in question comes with all the indicia of validity. It assumes to do nothing which the legislature did not have full power to do, and the court which it apparently established was permitted, without question, to exercise the functions apparently conferred upon it. To say that, upon the subsequent discovery of some evidence of an extrinsic fact, all that such apparent court has ever done shall at once be deemed undone, or rather never done, is not warranted by the Norton Case. ”
The learned counsel who argued the Norton Case for the plaintiff in error in the supreme court of the United States contended that, even though the act in question in that case should be condemned as unconstitutional, yet the subscription to the stock made by the commissioners, and the bonds issued b}' them, while in the undisputed tenure of their office as justices of the county court, are good and binding as regards third persons and the public, including the holders of the bonds, as acts of a defacto court, or of de facto officials. The supreme court of the United States refused to sustain that doctrine, and held that—
“While acts of a de facto incumbent of any office lawfully created by law and existing are often held to be binding from reasons of public policy, the acts of a person assuming to fill and perform the duties of any office which does not exist de jure can have no validity whatever in law.”
That question is not here necessarily involved, and I do not pass upon that question. That statute in question, upon the conceded facts, is presumed to have been constitutionally passed, the court in question is presumed to have been a de jure court, and, following the decision in Burt v. Railroad Co., as I understand that decision upon the facts really and properly before that court, I" think it is my duty to hold, as I do in this case, upon this collateral attack, that this court will not resort to the journals, or consider them as evidence or otherwise, for purposes of ascertaining whether or not that presumption can be overcome. Defendant’s objection to the evidence is sustained.
But, conceding, that the statute was constitutionally passed, and the court of common pleas of Hennepin county was in all respects a de jure court, plaintiff’s counsel strenuously contends that the judgment in Hale v. Comstock was and is void, because it was not rendered within the issue presented by the complaint. The complaint in that action was as follows:
“The plaintiff in the above-entitled ease complains of the defendant in said cause, and shows to the court—
*173“(1) That on the 13th day of February, A. D. 1874, the said Joseph Hodges filed in the district court of the United States for the district of Minnesota his petition, pursuant to the eleventh section of the act of congress entitled ‘ An act to establish a uniform system of bankruptcy throughout the United States, approved March 2, 1867,’ praying that he might be adjudged to be a bankrupt within the purview of said bankrupt act; that thereafter, and on the said 13th day of February, 1874, such proceedings were had in said court in bankruptcy in said matter of said Hodges; that the said Hodges was adjudged to be a bankrupt; that thereafter, and on the 6th day of May, 1874, such proceedings were had in said bankruptcy matter; that said plaintiff was by said court duly appointed assignee therein; that said plaintiff accepted said trust, and duly qualified as such assignee, and thereafter, and on the 15th day of June, 1874, received from Albert Edgerton, Esq., register in bankruptcy of said district, an assignment and conveyance, under the hand of said register and the seal of said court, of all the estate to which the said Joseph Hodges was, on the 18th day of February, 1874, in any manner entitled, and thereafter said plaintiff entered upon his duties as such assignee.
“(2) And said plaintiff further says that on the 30th day of May, 1873, at the city of Minneapolis, of said state of Minnesota, the said Joseph Hodges and his wife made and executed a certain deed to said defendant, a copy of which deed is hereto attached, made a part of this complaint, and marked ‘Exhibit A,’ pretending to convey to said defendant the following described property situate in the county of Hennepin and state of Minnesota, to-wit, block four, (4,) Groveland addition to Minneapolis, according to the record plat thereof on file in the office of the register qi deeds for Hennepin county; that said deed was recorded in the office of the register of deeds in and for said county on the 81st day of December, A. D. 1873, at 9 o’clock in the forenoon of said day, in Book number forty-three (43) of Deeds, on page six hundred and three, (603.)
“(3) And said plaintiff further says that the said deed was not delivered to said defendant, nor to any person for her, until long after the same was recorded, nor did defendant know of such deed until after the same was recorded; that said deed was not accompanied by an immediate and actual change of possession of the property; that ever since the same was executed and delivered, and up to the present time, the said property has remained in the actual possession and under the control of said Joseph Hodges, who has retained possession and control thereof under the false and fraudulent pretense that he is the agent of said defendant.
“ (4) That the pretended consideration set forth in said deed as paid by defendant to said Joseph Hodges and his wife is fictitious; that in fact no consideration, nor was ever any consideration, received by said Hodges or paid by defendant for said deed, but that said consideration of one dollar is therein inserted for the purpose of deceiving creditors of the said Hodges.
“(5) That at the time of the making, recording, and delivery of said deed the said Joseph Hodges was largely indebted to many persons, amounting in the aggregate to the sum of fifty thousand dollars, and was then insolvent, and in contemplation of bankruptcy, all of which the said defendant then well knew; that said deed was delivered to defendant within six months before the filing of the said petition heretofore mentioned, by said Hodges, and accepted by said defendant, with a view to prevent the property therein described from coming to his (said Hodges’) assignee in bankruptcy, and to prevent the same from being distributed according to said bankruptcy act, and for the purpose and with the intent to hinder, delay, and defraud the just creditors of said Hodges of their lawful claims and demands.
“(6) That said Hodges was, as a matter of fact, notwithstanding the mak ing, recording, and delivery of said deed on the 13th day of February, A. D. *1741874, and for ⅜ long time prior thereto had been, the true and lawful owner jn fee-simple of said described property; that the real value of said property is six thousand (6,u00) dollars; that by virtue of said assignment the said land became on the 13th day of February, 1874, the property of said plaintiff.
“Wherefore, said plaintiff demands judgment: That said deed from said Joseph Hodges and wife to said defendant be adjudged fraudulent and void as against the plaintiff, and for such other and further relief as to the.court may seem meet, and the costs and disbursements of this action.
“Dated Aug. 14, 1874, Minneapolis, Minn.”
The defendant did not appear. Service was had upon her by publication, in compliance with the laws of the state. The court acquired jurisdiction by such service to render a verdict in rem in that case. Arndt v. Griggs, 134 U. S. 316, 10 Sup. Ct. Rep. 557.
The contention of the plaintiff is that the complaint sets forth a cause of action only under the thirty-fifth section of the United States bankruptcy act, and that the form of action under that section requires the existence of four different facts, which constitute the essential averments of the complaint in Hale v. Comstock, namely: (1) The party making the transfer must be insolvent, or in contemplation of insolvency. (2) The recipient must be one who has reason to believe him insolvent, or acting in contemplation of insolvency. (3) The conveyance must be' made within six months prior to the filing of the petition in bankruptcy. (4) The act must be done to prevent 4he property from coming into the hands of the assignee in bankruptcy, and from being distributed under the bankrupt law. It is claimed by plaintiff that none of these essential facts appear in the findings or in the decree. The court found that there was no delivery of the deed prior to June, 1874; that there was no consideration paid for the same; that there was no knowledge on the part of the defendant of its existence; and that upon these facts the court based its conclusion of law; “that, no delivery of the deed having been made prior to Hodges’ adjudication as a bankrupt,, no title passed by it; and that the plaintiff was entitled to judgment vacating and setting aside said deed,” and that the judgment itself declares that said deed be vacated and set aside, and declares it to be hull and void and of no effect.
Upon an inspection of the complaint, the findings of fact, and conclusions of law, and after careful consideration of the elaborate and exhaustive brief of the learned counsel for the plaintiff, and the cases cited, I am unable to sustain the contention of the plaintiff. On the contrary, I think that the findings and judgment in that case are within the issue tendered by the complaint. The complaint is inartificially drawn, but I am of the opinion that it contains issuable facts sufficient to sustain the judgment. The court had jurisdiction of the parties and of the subject-matter for the purpose of that action, and the subject-matter of the action was the alleged right of the plaintiff to have the deed in question made in fraud of creditors annulled in so far as might be necessary to enable him to appropriate the property therein described to the payment of grantor’s creditors. It is alleged that the deed was executed in May, 1873, recorded in December, 1873, and not delivered *175to the grantee till long alter it was recorded; that there was no actual change in the possession of the property; that the consideration expressed ($>1) was fictitious; that the grantor was insolvent at the time; and that the grantee accepted the deed within six months before the filing of the debtor’s petition in bankruptcy, with a view to cover up the property in the interests of the grantor; that he retained possession and control of the property in the false and fraudulent pretense that he was the agent of the defendant, the grantee; that Hodges was in fact the real owner; that the real value of the property was $6,000. The prayer of the complaint is that this deed be adjudged fraudulent and void as against the plaintiff, and for general relief.
The findings of fact are that the defendant was a sister of Hodges’, who was insolvent at the time of the execution of the deed, and that it was not delivered to her until about June, 1874, long after the bankruptcy proceedings were instituted, and that it did not appear that any consideration was paid, or even that the defendant had any knowledge of the transaction until after Hodges had been adjudged a bankrupt. These averments were sufficient to support the findings and judgment. PJliminate every other averment from the complaint, and I think it necessarily follows from the remaining averments that a cause of action is set forth in the complaint sufficient to support the judgment. The supreme court of the state of Minnesota have had this question before it in the parallel case of Lane v. Innes, 43 Minn. 137, 45 N. W. Rep. 4, and I think the law laid down in that case is applicable here, and' the principles enunciated in that case I adopt. That court said:
“In considering this and several other objections to the validity of the judgment, the distinction between errors and delects which go to the jurisdiction and renders the proceeding wholly void, of no effect, and such as must be remedied in the same proceeding by appeal or otherwise, must be carefully observed. Quoting Salter v. Hilgen, 40 Wis. 365, 366: ‘It is not enough that there are irregularities in practico or insubstantial variances between the summons and complaint, or that the pleading is double, or improperly unites several causes of action, or contains more allegations or grounds for relief than is essential, or that the complaint is defectivo or incomplete, or that the findings of the court fail to cover all the issues tendered. If the matters determined are decisive of the case, and within the general scope of the allegations made and relief asked, the determination is not void, though the defendant has not appeared.’ ”
Judgment must be entered for tbe defendant, and it is so ordered.