« ForrigeFortsett »
in action in favor of any assignee, or of any had been made, except in cases of promis-
Q. Do you ins & Son. Q. By letter? A. It came through know anything about it? A. Indirectly, yes. the mail, Q. Have you the letter now? A. IQ. Do you mean by that you have some hearsay do not think that I have ; no, sir. Q. What did evidence upon it? A. Yes; I have an impresyou do with it? A. I could not swear that it sion from hearsay that the bank would have was. Q. It came in December of 1894, did it some equivalent for these bonds if suit was won. not? A. I should say it did.
Q. You say here that you own bonds of Lake As to the bonds referred to in the bill of sale county by virtue of a bill of sale from the Union br Susan F. Jones, executrix, the witness testi- Five Cent Savings Bank of Exeter, numbered
112--129, inclusive, together with all coupons, Q. What did you pay for that bill of sale, Mr. the first being No. 4, and the subsequent ones Dudley? A. For consideration not named in being consecutive up to and including No. 21. the bill of sale. Q. That does not answer my
What is the date of that bill of sale ? A. I question. What did you pay for it? A. I do think it was dated March 25th, 1885. Q. Were Dot remember as I paid anything. Q. Do you you present when it was made ? A. No, elr. remember that you did not pay anything? A.Q. When did you first know of its existence ? It is my impression that I did not. Q. Were A. In the year 1894. Q. At the time that you you present when it was drawn? A. No, sir. were informed of the existence of the others ? Q. In the event you recover a judgment in this A. Nearly at the same time, I should say, Q. case, are not the amounts of the coupons belong. Did you pay the bank of Exeter $10,695, or any ing to the bonds mentioned in the bill of sale other sum for the bonds mentioned in that bill from Mrs. Jones to be paid to Mrs. Jones, less of sale ? A. No, sir. Q. You also say in the her proportion of [the expenses of] the case ? same answer to the same interrogatory in your A. I could not state definitely about that. Q. | former deposition that you hold a bill of sale Why? A. For the reason that I answered simi. and assignment from Susan F. Jones for coular questions above. Q. Going back to the pons Nos. 55 to 64 and Nos. 65 to 66 for the bonds of Mr. Stanley, I will ask you one or two years 1886, '7, '8, 1891, also coupons amounting other questions. Is Mr. Stanley a citizen of to $600 from bonds 55-6-7-8-9-60 falling due in Colorado? A. I think he is. Q. Now, why did the year 1894. What is the date of that bill you not include in this case the coupons belong. of sale and assignment? A. I could not tell. ing to the Stanley bonds for 84, 85, and 86, and Q. When did you first know of its existence ? the coupons to bonds 68 to 72, included in the A. I should say in 1894. Q. Did you pay any. Stanley bill of sale of 1888, and the coupons on thing for it? A. No, sir.
Q. Did you 67, 87-91 for 1884-5? A. If they were not in- ever have in your possession any of the coupons cluded I do not know why they were not. Q. or any of the bonds to which this examination Is Mrs. Jones a citizen of the state of Colorado? has thus far been directed ? A. Strictly speak4. I think she is. Q. Were not those bonds ing, I don't think I ever had them in my own of Stanley and Jones assigned to you in order possession. I have seen some of the bonds and that you might as a citizen of another state handled them, had them in a safe. Q. Where? bring suit upon them and upon the coupons be- A. In Boston. Q. When ? A. Well, I should longing to them in the Federal court in Colo- say in the year 1893. Q. But that was before rado? A. I should answer that by referring to you knew they had been assigned to you by bill ny answer în former deposition to interrogatory of sale, was it not? A. I was really handling 9.
them as agent for other parties. Q. Who were In reference to the other bills of sale and the the other parties you were handling them as onds mentioned in them, the witness testified: agent for? A. I don't know as I was exactly
Q. In your answer to interrogatory 4 of your an agent. I was an officer of another company. ormer deposition you also say that you own They came into our hands. Q. What was that onds of Lake county by the written bill of sale company? A. E. H. Rollins & Sons. Q. Were rom the Nashua Savings Bank, numbered 92- you a stockholder of that company ? A. Yes. 0. 11, both inclusive, together with all coupons Are you now? A. Yes, sir. Q. Is not that the riginally attached and unpaid. You also say only interest which you have in these bondo bat the consideration for the said bill of sale or any of them-your interest as a stockholder
$11,689.45. Did vou pay any part of that, in the firm of E. H. Rollins & Sons? A. Yes, Ir. Dudley ? A. No, sir. Q. Were you present probably it is.
could have sued in such court. It is imma- tended to be passed for the transfer. This
It said: “The arrangement by which, with-
ized a Pennsylvania corporation and conBy the fifth section of the above act of veyed these lands to the new corporation for March 3d, 1875, it is provided "that if, in the express purpose--and no other purpose any suit, commenced in a circuit court or is stated or suggested-of creating a case for removed from a state court to a circuit court the Federal court, must be regarded as a of the United States, it shall appear to the mere device to give jurisdiction to a circuit satisfaction of said circuit court, at any time court of the United States, and as being in
after such suit has been brought or removed law a fraud upon that court, as well as a (251)*thereto, that such suit does not really and wrong to the defendants. Such a device can
substantially involve a dispute or contro- not receive our sanction. The court below
Prior to the passage of the act of 1875 it invoke the jurisdiction of the Federal had been often adjudged that if title to real court, but must have sued, if they sued or personal property was put in the name of at all, in one of the courts of Colorado. It a person for the purpose only of enabling is true that some of the coupons in suit are hiin, upon the basis of the diverse citizen- owned by, corporations of New Hampshire, ship of himself and the defendant, to invoke who could themselves have sued in the cir. the jurisdiction of a circuit court of the cuit court of the United States. But if United States for the benefit of the real own- part of the coupons in question could not, er of the property, who could not have sued in by reason of the citizenship of the owners, that court, the transaction would be regard. have been sued on in that court, except by ed in its true light, namely, as one designed uniting the causes of action arising thereon to give the circuit court cognizance of a case with causes of action upon coupons owned in violation of the acts of Congress defining by persons or corporations who might have its jurisdiction; and the case would be dis- sued in the circuit court of the United missed for want of jurisdiction. Maxwell's States, and if all the causes of actions were Lessee v. Levy, 2 Dail. 381 [1: 424]; Hurst's thus united for the collusive purpose of Lessee v. McNeil, 1 Wash. c. c. 70, 80; making "a case" cognizable by the Federal M'Donald v. Smalley, 1 Pet. 620, 624 [7: court as to every issue made in it, then the 287, 289); Smith v. Kernochen, 7 How. 198, act *or 1875 must be held to apply, and the[ 253) 216 [12: 666,673]; Jones v. League, 18 How. trial court on its own motion should have 70, 81 [15: 263, 264]; Barncy v. Baltimore dismissed the case without considering the City, 6 Wall. 280, 288 [18: 825, 827). These merits. cases were all examined in Lehigh Mining & In Williams v. Nottawa, 104 U. S. 209, Mfg. Co. v. Kelly, 160 U. S. 327, 339 (40: 211 [26: 719, 720), this court said that Con 444, 449). In the latter case it appeared that gress when it passed the act of 1875 extenda Virginia corporation claimed title to lands ing the jurisdiction of the courts of the in that commonwealth, which were in the United States "was specially careful to possession of certain individuals, citizens of guard against the consequences of collusive Virginia. The stockholders of the Virginia transfers to make parties, and imposed the corporation organized themselves into a cor duty on the court, on its own motion, withporation under the laws of Pennsylvania, in out waiting for the parties, to stop all furorder that the Pennsylvania corporation, af- ther proceedings and dismiss the suit the ter receiving a conveyance from the Virgin moment anything of the kind appeared. ia corporation, could bring suit in the cir. This was for the protection of the court as cuit court of the United States sitting in well as parties, against frauds upon its ju
Virginia, against the citizens in that com. risdiction.” (262]monwealth *who held possession of the lands. So, in Farmington v. Pillsbury, 114 U. S
The contemplated conveyance was made, but 138, 146 [29: 114, 117], which was a suit no consideration actually passed or was in-upon coupons, brought by a citizen of Mas
sachusetts against a municipal corporation of never requested the execution of the preMaine, and in which one of the questions was tended bills of sale referred to, nor did he as to the real ownership of the coupons, this hear of their being made until more than court said: “It is a suit for the benefit of nine years after they were signed.
And, notthe owners of the bonds. They are to receive withstanding the evasive character of his anfrom the plaintiff one half of the net pro- swers to questions, it is clear that his transceeds of the case they have created by their ferrers are the only real parties in interest. transfer of the coupons gathered together and his name is used for their benefit. The for that purpose. The suit is their own in transfer was collusive and simulated for the reality, though they have agreed that the purpose of committing a fraud upon the ju. plaintiff may retain one half of what he colorisdiction of the circuit court in respect at lects for the use of his name and his trouble least of part of the causes of action that in collecting. It is true the transaction is make the case before the court. called a purchase in the papers that were ex- For tho reasons stated the trial court, ecuted, and that the plaintiff gave his note when the evidence *was concluded, should on for $500, but the time for payment was put its own motion have dismissed the suit. off for two years, when it was, no doubt, sup- The judgment of the Circuit Court and the posed the result of the suit would be known. judgment of the Circuit Court of Appeals No money was paid, and as the note was not must both be reversed, and the cause renegotiable, it is clear the parties intended to manded for a new trial and for further prokeep the control of the whole matter in their ceedings consistent with this opinion. own hands, so that if the plaintiff failed to It is so ordered. recover the money he could be released from his promise to pay.” It was consequently held that the transfer of the coupons was "a mere contrivance, a pretense, the result of a BOARD OF COUNTY COMMISSIONERS collusive arrangement to create a fictitious OF THE COUNTY OF GUNNISON, ground of Federal jurisdiction.”
STATE OF COLORADO, Petitioner, In Little v. Giles, 118 U. S. 396, 603 [30: 269, 271), reference was made to the act of
E. H. ROLLINS & SONS. 1875, and the court said that where the interest of the nominal party was “simulated and collusive, and created for the very pur;
(See 8. C. Reporter's ed. 255-276.) 4]pose of giving jurisdiction, the courts *should When bill of exceptions may be taken as con
not hesitate to apply the wholesome provi- taining all the evidence-when recital in sions of the law."
county bonds estops the county-when in. We have held that if, for the purpose of dorsee of commercial paper can recover placing himself in a position to sue in a
upon the title of the indorser-innocent circuit court of the United States, a citizen holder. of one stato acquires a domicil in another state without a present intention to remain 1. Although a bill of exceptions does not state, in the latter state permanently or for an in- in words, that it contains all the evidence, yet definite time, but with the present intention it may be taken as containing all where the to return to the former state as soon as he entries sufficiently show that fact. can do so without defeating the jurisdiction 2. A recital in county bonds that the debt of the Federal court to determine his suit, thereby created does not exceed the limit prethe duty of the circuit court is on its own
scribed by the state Constitution estops the motion to dismiss such suit as a collusive one
county from asserting, as against a bona fide under the act of 1875. Morris v. Gilmer,
holder for value, that the contrary is the fact.
3. 129 U, S. 315 [32: 690]. The same princi
A bona fide holder of commercial paper is
entitled to transfer to a third party all the ple applies where there has been a simulated
rights with which he is vested, and the title transfer of a cause of action in order to make
so acquired by his indorsee cannot be affected a case cognizable under the act.
by proof that the indorsee was acquainted The cases cited are decisive of the present with defenses existing against the paper,
As the coupons in suit were payable 4. One who surrenders county warrants for to bearer and were made by a corporation, county bonds is as much an innocent holder Dudley, being a citizen of New Hampshire, of the bonds as if he had bought them in open could have sued the defendant, a Colorado market, and is entitled to the benefit of the corporation, in the circuit court of the Unit. rule above stated as to the conclusiveness of ed States without reference to the citizenship
the recital in the bonds. of his transferrers, or the motive that may
[No. 178.] have induced the transfer of the coupons to him, or the motive that may have induced Argued December 15, 16, 1898. Decided him to buy them, provided he nad really pur
February 20, 1899. . But he did not buy the cou
N WRIT OF to the them. He is put forward as owner for the purpose of making a case cognizable by the Eighth Circuit to review a judgment of that Federal court as to all the causes of action court reversing the judgment of the Circuit enibraced in it. The apparent litle was put Court of the United States for the District in him without his knowledge and without of Colorado in favor of defendant in an achis request, and only that he might repre- tion brought by E. H. Rollins & Sons, a corsent the interests of the real owners. He' poration of New Hampshire, against the 173 U. S. U. S., BOOK 43.
ponse at all. He is not the owner of any bé Ostates Circuit Court of Appeals for the
County Commissioners of the County of Gun- | the evidence need not be shown in any par nison for the amount of certain coupons of ticular or technical form, bonds. The Circuit Court of Appeals gave Spangler v. Green, 21 Colo. 505. judgment for only a portion of the amount The instructions to the jury, duly exclaimed. Judgment of the Circuit Court cepted to, were reviewable by the circuit and of the Circuit Court of Appeals re- court of appeals, and are open to consideraversed, and cause remanded for further pro- tion in this court. ceedings.
Pennock v. Dialogue, 2 Pet. 1; WorthingSee same case below, 49 U. S. App. 399. ton v. Mason, 101 V. S. 149, 25 L, ed. 848; The facts are stated in the opinion. United States v. Rindskopf, 105 U. S. 418,
Messrs. Thomas C. Brown, C. S. 26 L. ed. 1131; Ward v. Cochran, 150 C. S. Thomas, W. H. Bryant, and H. H. Lee, for 597, 37 L. ed. 1195. petitioner:
The rulings of the court, which were duly The court errs in reversing the judgment objected and excepted to at the time, were on errors committed in the admission or reviewable by the circuit court of appeals. exclusion of testimony, when the record l'icksburg & M. R, Co. v. O'Brien, 119 U. shows that all the testimony was not con- S. 99, 30 L. ed. 299; Meria v. Oliver, 148 U. tained in the bill of exceptions, and the court S. 664, 37 L. ed. 602; Lincoln v. Claflin. 7 below directed a verdict for the defendant. Wall. 132, 19 L. ed. 106; Lees v. United
Where a court takes a case away from a States, 150 U. S. 476, 37 L. ed. 1150; Hicks jury and directs a verdict, the same rules man v. Jones, 9 Wall. 197, 19 L. ed. 551; apply as though the court had tried the case Michigan Ins. Bank v. Eldred, 143 U. S. 293, alone without a jury.
36 L. ed. 162. Robbins v. Potter, 98 Mass. 532; Daly v. Plaintiff was a bona fide holder of the Wise, 132 N. Y. 306, 16 L. R. A. 236; Maier coupons in question. v. Davis, 57 Wis. 212.
San Antonio v. Mehaffy, 96 U. S. 312, 24 Every presumption will be indulged in to L. ed. 816; Lexington v. Butler, 14 Wall. sustain the judgment of a trial court; and 282, 20 L. ed. 809; Macon County v. Shores, although improper evidence may have been 97 U. S. 272, 24 L. ed. 889. admitted, it will be presumed that in arriv- A bona fide holder is a purchaser for ing at a conclusion only proper evidence was value without notice, or the successor of one considered, and that the judgment of the who was such a purchaser. court below is correct.
McClure v. Oxford Twp. 94 U. S. 429, 24 Hinckley v. Pittsburgh Bessemer Steel Co. L. ed. 129. 121 U. S. 264, 30 L. ed. 967; Mammoth Min- If any previous holder of the bonds in suit ing Co. v. Salt Lake Foundry & Mach. Co. was a bona fide holder for value, the plain151 U. S. 447, 38 L. ed. 229; Parker v. Van tiff can avail himself of such previous holdBuren, 20 Colo. 217; White v. White, 82 er's position without showing that he himCal. 427, 7 L. R. A. 799; Smith v. Long, 106 self has paid value. Ill. 485; Tower v. Fetz, 26 Neb. 706; Kirk- Montclair v. Ramsdell, 107 U. S. 147, 27 land v. Telling, 49 Wis. 634; Minton v. Pick- L. ed. 431. ens, 24 S. C. 592; State v. Seabright, 15 W. Though he may have notice of infirmities Va. 590.
in its origin, a purchaser of a municipal The court below erred in holding that it bond from a bona fide holder before matuwas error in the trial court to admit in evi- rity takes it as free from such infirmities as dence the financial statements of Gunnison it was in the hands of such holder. county for the six months ending respective- Cromwell v. Sac County, 96 U. S. 51, 24 L. ly on December 31, 1881, June 30, 1882, and ed. 681; Douglas County Comrs. v. Bolles, 94 December 30, 1882.
U. S. 104, 24 L. ed. 46; Marion County Dixon County v. Field, 111 U. S. 83, 28 L. Comrs. v. Clark, 94 U. S. 278, 24 L. ed. 59; ed. 360; Lake County v. Graham, 130 U. S. Nauvoo v. Ritter, 97 U. S. 389, 24 L. ed. 1050. 674, 32 L. ed. 1065; Hedges v. Dixon County, The plaintiff Standley was a bona fide 150 U. S. 182, 37 L. ed. 1044; Lake County holder of the $5,000 of bonds received by him Comrs. v. Standley, 24 Colo. 1.
in exchange for warrants which he surrenThe court erred in holding that the re- dered to Gunnison county. citals contained in the bonds estopped the Douglas County Comrs. v. Bolles, 94 U. S. county from proving against an innocent 104, 24 L. ed. 46; Montclair v. Ramsdell, purchaser that the bonds had been issued in 107 U. S. 147, 27 L. ed. 431. excess of the limit of indebtedness author. The recital in the bonds, "that the total ized by the Constitution of Colorado.
amount of this issue does not exceed the Lake County v. Graham, 130 U. S. 674, 32 limit prescribed by the Constitution of the L. ed. 1060; Graves v. Saline County, 161 U. state of Colorado,” is conclusive as an esS. 359, 40 L. ed. 732; Sutliff v. Lake County toppel in favor of a bona fide holder of the Comrs. 147 U, S. 230, 37 L. ed. 145.
bonds in question. Messrs. John F. Dillon, Edmund F. Chaffee County v. Potter, 142 U.S. 355,35 Richardson, Harry Hubbard, and John M. L. ed. 1040; Buchanan v. Litchfield, 102 U. Dillon, for respondent:
S. 278, 26 L. ed. 138; Independent School Moral justice and equity and fair dealing Dist. v. Stone, 106 U. S. 183, 27 L. ed. 90; equally entitle the plaintiff to a recovery. Sherman County v. Simons, 109 U. S. 735,
Jasper County v. Ballou, 103 U. S. 745, 26 27 L. ed. 1093; Dallas County v. McKenzie, L. ed. 422; Graves v. Saline County, U. | 110 U. S. 686, 28 ed. 285; Diron County S. 359, 40 L. ed. 732.
v. Field, 111 U. S. 83, 28 L. ed. 360. That the bill of exceptions contains all of The recital in the bond in question, that it is issued "for valid floating indebtedness Lexington v. Butler, 14 Wall. 282, 20 L. of the said county," creates an estoppel ed. 809; Macon County v. Shores, 97 U. S. which is conclusive in favor of the bona fide 272, 24 L. ed. 889; Cromwell v. Sac County, holder of such bonds.
96 U. S. 51, 24 L. ed. 681; Montclair v. Jusper County v. Ballou, 103 U. S. 745, 26 Ramsdell, 107 U. S. 147, 27 L. ed. 431. L. ed. 422; Graves v. Saline County, 161 U. S. 359, 40 L. ed. 732; Huron v. Second Ward *Mr. Justice Harlan delivered the opin- Sav. Bank, 57 U. S. App. 593, 86 Fed. Rep. ion of the court: 272, 30 C.C.A.38; West Plains Tup. v. Sage, This action was brought by E. H. Rollins 32 U. S. App. 725, 69 Fed. Rep. 943, 16 C. C. & Sons, a corporation of New Hampshire, to A. 553; kiowa County Comrs. v. Howard, obtain a judgment against the board of com49 U. S. App. 642, 83 Fed. Rep. 296, 27 C. C. missioners of Gunnison county, Colorado, A. 531; Cadillac v. Woonsocket Inst. for Sav. a municipal corporation of that state, for 16 U. S. App. 546, 58 Fed. Rep. 935, 7 C. C. the amount of certain coupons of bonds isA. 574; National L. Ins. Co. v. Huron Bd. of sued by the defendant in 1882. At the close Edu. 27 U. S. App. 244, 62 Fed. Rep. 778, 10 of the evidence the defendant requested a C. C. A. 637.
peremptory instruction in its behalf. The The issue of bonds to pay off or refund an circuit court charged the jury at some existing indebtedness does not increase the length, but concluded with a direction to find debt or create a new debt. It merely changes a verdict for the defendant, which was done, the form of the old debt.
and a judgment in its favor was entered. Powell v. Madison, 107 Ind. 106; Blanton That judgment was reversed in the circuit v. McDowell County Comrs. 101 N. C. 532; court of appeals, and the case is here upon Los Angeles v. Tweed, 112 Cal. 319; Sioux writ of certiorari. 49 U. S. App. 399. City v. Weare, 59 Iowa, 95; Opinion of the The case made by the complaint is as fol. Justices in 81 Me. 602, Appx.
lows: The so-called "financial statements" can- By the laws of Colorado, boards of county not be introduced in evidence as against a commissioners were authorized to examine, bona fide holder of the bonds in question allow, and settle all accounts against their containing such recitals as these bonds con respective counties, and to issue county wartain.
rants therefor; to build and keep in repair Sutliff v. Lake County Comrs. 147 U. S. the county buildings, to insure the same, 230, 37 L. ed. 145; Chaffee County v. Potter, and to provide suitable rooms for county 142 U. S. 355, 35 L. ed. 1040; Evansville v. purposes, and to represent the county, and Dennett, i61 U. S. 434, 40 L. ed. 760. have the care of county property and the
No record is constructive notice as to any management of the business and concerns of negotiable paper unless a statute expressly the county in all cases where the law did not so provides
otherwise provide. Burck v. Taylor, 152 U. S. 634, 38 L. ed. On the 1st day of December, 1882, the de578.
fendant board caused to be made and executThe purchaser of negotiable paper does ed certain bonds acknowledging the county not have constructive notice of any litiga- of Gunnison to be indebted and promising tion pending, or any judgments which may to pay to
or bearer the sum therehave been previously rendered, regarding in named, for value received, redeemable at such paper.
the pleasure of the county after ten years, Warren County v. Marcy, 97 U. S. 96, 24 and absolutely due and payable twenty L. ed. 977; Carroll County v. Smith, 111 U. years after date, at the office of the county S. 550, 28 L. ed. 517; Orleans v. Platt, 99 treasurer, with interest at eight per cent V. S. 676, 25 L. ed. 404; Cass County v. Gil. *per annum, payable semi-annually on the[257) lett, 100 U. S. 585, 25 L. ed. 585; Thompson first days of March and September in each v. Perrine, 103 U. S. 806, 26 L. ed. 612. year at the county treasurer's office, or at
Where it is sought to affect a bona fide the Chase National Bank in the city of New purchaser for value of commercial paper York, at the option of the holder, upon the with constructive notice, the question is not presentation and surrender of the annexed whether he had the means of obtaining, or coupons as they severally became due. might have obtained by prudent caution, Each bond contained this recital: "This the knowledge in question, but whether not bond is issued by the board of county comobtaining was an act of gross or culpable missioners of said Gunnison county in ex. negligence.
charge, at par, for valid floating indebtedWilson v. Wall, 6 Wall. 83, 18 L. ed. 727 ; ness of the said county outstanding prior to Ware v. Egmont, 4 DeG. M. & G. 460; Goetz September 20, 1882, under and by virtue of v. Bank of Kansas City, 119 U. S. 551, 30 L. and in full conformity with the provisions ed. 515.
of an act of the general assembly of the state A person may estop himself from relying of Colorado, entitled 'An Act to Enable the upon the constructive notice which records Several Counties of the State to Fund Their furnish.
Floating Indebtedness,' approved February Brookhaven v. Smith, 118 N. Y. 634, 7 L. 21st, 1881; and it is hereby certified that R. A. 755; Wilde v. Gibson, 1 H. L. Cas. 605; all the requirements of law have been fully Stone v. Covell, 29 Mich. 359.
complied with by the proper officers in the If the plaintiff proves the payment of issuing of this bond. It is further certified value, then the burden is on the defendant that the total amount of this issue does not to show that the plaintiff had notice of the cxceed the limit prescribed by the Constituillegality or fraud.
tion of the state of Colorado, aud that this