United States v. Chicago, M. & St.P. Ry. Co., 195 U.S. 524 (1904)

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Author: Justice Peckham

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United States v. Chicago, M. & St.P. Ry. Co., 195 U.S. 524 (1904)

MR. JUSTICE PECKHAM, after making the foregoing statement of facts, delivered the opinion of the Court.

The Attorney General contends that, before the passage of the act of Congress granting the land (July 4, 1866), Barclay had made legal entry upon the books of the local land office, of the land in question, under the homestead laws of Congress, and that such legal entry was in existence at the time of the passage of the Act of Congress of July 4, 1866; that, by reason of such entry, the land was excepted from the grant under that act, and that, when Barclay abandoned his homestead claim upon the land, it immediately became public land of the United States, and did not then pass under the grant to the state pursuant to the Act of July 4, 1866, and it was therefore not legally withdrawn from market by any act of the Land Department, nor could it be certified to the state, and that the attempt to do so was not only erroneous, but absolutely void; that at the Time when Donovan made application to enter the land, in June, 1868, it was part of the public lands of the United States, open to entry, and his application, although he had done all that he could, was wrongfully denied by the local land office; that thereafter the filing of the map of definite location by the railway company, and its selection of the land in question, and the certification of the land by the Secretary of the Interior to the state, and the conveyance by the state to the railway company, and the contract and conveyances following thereon, conveyed no interest in or title to the premises in question, but that they rightfully belonged to Donovan, and therefore the certification by the Land Department, etc., should be set aside, to the end that the land may be transferred to Donovan, as demanded in the bill.

On the other hand, it is insisted on the part of the defendant Woodwick that the action of the Land Department officials in withdrawing the land in question from market was valid, and within the jurisdiction of that department; that the selection of the land by the railway company was proper as being within the indemnity limits of the grant by Congress, and that its certification by the Secretary of the Interior to the state was within the power of that officer, and the act was not therefore beyond his jurisdiction, and that his certification and the action of the state conveyed a good title, or at any rate, that the defendant Woodwick was a bona fide purchaser of the land, and as such his rights were preserved under the Act of March 3, 1887. 24 Stat. 556.

If Woodwick is protected under that act as a purchaser in good faith, even against Donovan, it is unnecessary to pursue an inquiry as to the existence of any other defense. We are of opinion that Woodwick is protected under the fourth section of the act. The plain intent of that section is, as stated by MR. JUSTICE BREWER in delivering the opinion of the Court in United States v. Winona &c. Railroad, 165 U.S. 463, to secure one who, in good faith and as an honest transaction, purchases the land, and to leave to the government a simple claim for money against the railroad. The Justice said (pp. 480-481):

It will be observed that the technical term "bona fide purchaser" is not found in this section, and while it is provided that a mortgage or pledge shall not be considered a sale so as to entitle the mortgagee or pledgee to the benefit of the act, it does secure to everyone who, in good faith, has made an absolute purchase from a railroad company, protection to his title, irrespective of any errors or mistakes in the certification or patent.

. . . These being the provisions of the act of 1887, the act of 1896, 29 Stat. 42, confirming the right and title of a bona fide purchaser, and providing that the patents to his lands should not be vacated or annulled, must be held to include one who, if not in the fullest sense a "bona fide purchaser," has nevertheless purchased in good faith from the railroad company.

The counsel for the government, while strenuously denying that the legal title to this land passed to the State of Minnesota by virtue of the certification, in 1871, admits in his brief that, if Woodwick bought the land as a bona fide purchaser in 1899, and acquired the legal title to the same, then at that present time, not only was the right of the United States to recover the land defeated, but Donovan was precluded from thereafter asserting his claim to the land, as against such bona fide purchaser. His denial that the legal title passed is based upon the contention that Donovan, before the year 1871, when the Secretary of the Interior certified this land to the state, had, as stated by counsel, initiated proceedings to obtain this land in section 35 as a homestead, and had done all he could to make entry thereof, and had been in possession for three years before this certification, and that, prior to 1871, an initiatory title had passed from the United States to Donovan by reason of his possession and offer to enter the land, and his payment of the fees and expenses to the local land officers, so as to prevent the passage of the legal title to the state, by virtue of the certification referred to, which, by reason of the acts of Donovan, was rendered wholly void. It is also asserted that, if the United States, in 1871, did retain title in itself, notwithstanding Donovan’s occupation and cultivation of the land, yet such occupation and cultivation withdrew the land from the jurisdiction of the Land Department, so far as any right or power to issue a certification to the railroad company was concerned, just as effectually as though the land had been reserved or otherwise appropriated specifically by an act of Congress.

We think that, in 1871, when the certification was made, jurisdiction over this land remained in the Land Department, to be exercised by the Secretary of the Interior notwithstanding the acts of Donovan as shown by this record. It is shown by the testimony of Donovan himself and of his witness Bullis, putting it all together, that there never was in fact any entry of this land at the local land office in the name of Donovan before the certification in 1871. The facts as to what took place in that office in regard to the applications of Donovan in 1867, before the Barclay entry was cancelled, and in June, 1868, when the entry was made for the lot in section 26, are set forth in the statement of facts herein, and need not be repeated. The statement shows no such facts as put Donovan in the place of one who, having done all he could to enter the land, had been refused such entry, but had nevertheless not acquiesced in such decision, and had taken possession of it as a homestead. On the contrary, Donovan did acquiesce in that decision, and amended his application.

There was no entry made on the books of the local land office for this land, under the amended application, and the power of the Secretary of the Interior to make the certification, even if we assume that it was erroneously exercised, was not an act which was beyond the jurisdiction of the Secretary. The legal title was thus transferred by the government to the state, and at the most, it was an erroneous certification within the meaning of the act of 1887. Although, under such circumstances, if the certification were erroneous and might have been avoided, and the land recovered back by the government while in the hands of the railroad company, yet Woodwick, if a purchaser in good faith of the lands, was entitled to them under the provisions of the act. He had no notice, actual or constructive, of the claim of the government in regard to this land. The record title was plain. No suit had been commenced when Ericksrud took his title from the government, and went into possession thereunder. He died within a week thereafter, and his heirs thereupon took possession. They were in possession when the government commenced this suit in 1893, but were never served with process therein until 1901, which was two years after Woodwick had purchased the property from them, and had in good faith paid them the sum of $2,000 in cash for the land.

Counsel for the government admits that it is futile to maintain that Woodwick had constructive notice of the defects in his title by reason of the pendency of this suit, which had been commenced by the government in 1893, but in which the railroad companies alone had been served with process.

Whatever equities Donovan may have had as against the government, by virtue of his so-called attempt to make entry for the eighty acres in section 35, they do not override the plain provisions of the statute of 1887, and also that of 1896, 26 Stat. 42, which save the rights of one who purchased from the railroad in good faith.

As was observed by MR. JUSTICE BREWER in the case already referred to, United States v. Winona &c. Railroad, 165 U.S. 480,

It matters not what constructive notice may be chargeable to such a purchaser if, in actual ignorance of any defect in the railroad company’s title, and in reliance upon the action of the government in the apparent transfer of title by certification or patent, he has made an honest purchase of the lands.

Donovan is not brought within the case of Winona &c. Railroad v. United States, immediately following the above-cited case at 483, because, among other facts, it appears herein that there was no record of any entry in Donovan’s case for this land, on the books of the local land office, and it is conceded that he had been out of any possession of the land since 1885. The above-cited case is not therefore in point. The same may be said of Duluth &c. Railroad v. Roy, 173 U.S. 587, and Oregon &c. Railroad v. United States, 189 U.S. 103, 116.

Donovan cannot be regarded as having by his action secured a vested interest in this land, so as to make the certification to the state a wholly void act, as an act beyond the jurisdiction of the Secretary. Assuming that it may have been erroneous and voidable, it was not void. We do not decide it was erroneous. In 1871, the legal title, still remaining in the government, was transferred to the state by the certification of the Secretary, and, as we have said, Woodwick occupied the position of a purchaser in good faith under the acts of Congress.

The judgment is

Affirmed.

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Chicago: Peckham, "Peckham, J., Lead Opinion," United States v. Chicago, M. & St.P. Ry. Co., 195 U.S. 524 (1904) in 195 U.S. 524 195 U.S. 535–195 U.S. 539. Original Sources, accessed August 9, 2022, http://www.originalsources.com/Document.aspx?DocID=3X3DZ1ZQGGJREK8.

MLA: Peckham. "Peckham, J., Lead Opinion." United States v. Chicago, M. & St.P. Ry. Co., 195 U.S. 524 (1904), in 195 U.S. 524, pp. 195 U.S. 535–195 U.S. 539. Original Sources. 9 Aug. 2022. http://www.originalsources.com/Document.aspx?DocID=3X3DZ1ZQGGJREK8.

Harvard: Peckham, 'Peckham, J., Lead Opinion' in United States v. Chicago, M. & St.P. Ry. Co., 195 U.S. 524 (1904). cited in 1904, 195 U.S. 524, pp.195 U.S. 535–195 U.S. 539. Original Sources, retrieved 9 August 2022, from http://www.originalsources.com/Document.aspx?DocID=3X3DZ1ZQGGJREK8.