St. Paul, M. & M. Ry. Co. v. St. Paul & N. P. R.

THAYEB, Circuit Judge, after stating the ease as above, delivered the opinion of the court. The first question presented for consideration is one of jurisdiction, and. as both parties to the suit are corporations created by and existing under the laws of the state of Minnesota, the decision of the jurisdictional question turns upon the inquiry whether the case is one arising under the laws of the United States. Since the recent decisions in Tennessee v. Union & Planters’ Bank, 152 U. S. 454, 14 Sup. Ct. 654; Chappell v. Waterworth, 155 U. S. 102, 15 Sup. Ct. 34; and Postal Telegraph Cable Co. v. Alabama, 155 U. S. 482, 15 Sup. Ct. 194,—it must be regarded as settled that the circuit court of the United States cannot entertain jurisdiction of a case as one arising under the constitution, laws, or treaties of the United. States,, whether such suit is commenced therein originally, or is brought there by-removal, unless the plaintiff’s complaint or declaration shows (hat it is a case arising under the federal constitution or national laws or treaties. And even under the judiciary act of March 3, 1875 (18 Stat. 470, c. 137), the same rule, it seems, was applicable to suits, originally brought in the circuit court; that is to say, under that act the right to entertain a case brought therein originally, on the ground that it involved a federal question, depended upon the inquiry whether the plaintiff’s statement of his cause of action showed llie existence of a federal question. Tennessee v. Union Planters’ Bank, supra; Metcalf v. Watertown, 128 U. S. 586, 589, 9 Sup. Ct. 173. The necessary result of this doctrine is that, when a complaint filed in the circuit court of the United States discloses a controversy arising under federal laws, the jurisdiction of the court will not be — 10 — defeated by any defense or plea that tbe defendant may see ñt to make. If tbe plaintiff’s right to sue in tbe national courts is to be tested solely by bis complaint or declaration, and is not aided by any plea interposed by tbe defendant, no matter bow clearly tbe latter may show that the construction or application of federal laws is involved, then it follows that, if jurisdiction is fairly disclosed by the plaintiff’s statement of bis own cause of action, it cannot be defeated by an answer or plea so conceived and drawn as to avoid tbe consideration of any federal question or questions. In other words, as was said, in substance, in Osborn v. Bank, 9 Wheat. 738, 824, tbe right of tbe plaintiff to sue does not depend upon.tbe defense which the defendant may choose to set up, because tbe right to sue exists, if at all, before any defense is made, and must be judged exclusively as of tbe date of tbe filing of the complaint, on tbe state of facts therein disclosed. If, on tbe face of tbe complaint or declaration, tbe case is one which the court has tbe power to bear and determine, because of tbe existence of a federal question, it has tbe right to decide every issue that may subsequently be raised, and whether the decision of tbe case ultimately turns on a question of federal, local, or general law isa matter that in no wise affects tbe jurisdiction of the court. Mayor v. Cooper, 6 Wall. 247; Railroad Co. v. Mississippi, 102 U. S. 135, 141; Tennessee v. Davis, 100 U. S. 257, 264; Omaha Horse Railway Co. v. Cable Tramway Co., 32 Fed. 727. In tbe light of these principles, we proceed to inquire whether any question of a federal character is presented by tbe bill of complaint which it may become necessary to decide in disposing of the issues involved in the present controversy. In the consideration of this question we do not deem it essential to state in detail all of the allegations, of the amended bill, on which the case appears to have been tried and decided. It will suffice to say in this behalf that the amended complaint set forth by appropriate allegations all of the legislation, both state and national, affecting the land grant in question, and all of the facts and circumstances pertaining thereto, which we have already recited at length in the foregoing statement. In addition to such averments, the amended bill also alleged, in substance, that the lands now in controversy, being those situated north of Watab, were conveyed by the governor of the state of Minnesota to the First Division Company before the line of road along which they specifically lay in place was completed through and coterminous therewith; that the road abreast of which the disputed lands lie was constructed by the plaintiff company, and not by the First Division Company; that no part of said lands ever belonged or pertained to that part of the branch line which was constructed by the First Division Company, and that, in executing the deeds for the lands in controversy to the First Division Company, the governor of the state acted “wrongfully and without authority of law,” and that the deeds so executed were “contrary to law, and void.” The bill further averred that the plaintiff company was the owner of, and that it laid claim to, all the lands in dispute; that the defendant company had no interest therein or right thereto; and it contained a prayer that the plaintiff company be decreed to be the — 11 — owner of said lands, and that the deeds executed by the governor be adjudged to be null and void, and that the same be canceled as a cloud upon its title. In all of its essential features, therefore, the case made by the amended complaint was a suit to remove a cloud and to quiet title. It does not follow, however, that the case at bar is one of federal cognizance because it contains a reference to immerotis acts of congress, and lengthy extracts therefrom. A case which in fact depends for its decision upon questions of local or general law cannot he brought within the jurisdiction of a federal tribunal as one arising under the constitution and laws of the United states merely by a reference in the complaint or declaration to some federal statute or statutes, and by setting up a claim thereunder which is merely colorable, and obviously without any reasonable foundation. If such a practice was tolerated, the result would be that the jurisdiction of the federal courts would be unduly enlarged, aud made to comprehend a class of cases which were never intended to be tried therein. New Orleans v. New Orleans Water Works, 142 U. S. 79, 12 Sup. Ct. 142; Hamblin v. Land Co., 147 U. S. 532, 13 Sup. Ct. 353; St. Louis, etc., Ry. Co. v. State of Missouri, 15 Sup. Ct. 443. At this point it accordingly becomes necessary to examine the various grounds upon which the plaintiff company predicates its right to recover. It is obvious that it derives its right to sue solely from the act passed by the legislature of the state of Minnesota on March 1, 1877, the material provisions of which act have been embodied in the foregoing statement. In the absence of that enactment, the plaintiff company would have no standing in any court, state or federal, to challenge the defendant’s title to the lands in controversy, whether the deeds conveying the same are valid or in-» valid, void or voidable. The first question, then, that is encountered in the case is whether, by the act last aforesaid, the legislature of the state in fact intended to transfer the lands north of Watab, which had theretofore been deeded by the- governor of the state to the First Division Company, to such other railroad company as might construct the uncompleted line of road from Watab to Brainerd, and whether, if it did so intend, the language of the act was adequate to vest in such company as elected to complete the road a legal title to such lands north of Watab and within the limits of the grant as The state then had power to convey. With respect to this question, a controversy arises between the two companies. IÍ; is the primary issue in the case. And it must be conceded, we think, that this controversy between tbe parties raises a question of local law which is in no wise dependent for its decision upon the construction of any federal statute. But if this primary question is decided in the affirmative, as the plaintiff contends that it ought to he, such decision is not decisive of the plaintiff’s right to recover. It is merely one step in the direction of a recovery, and, for that reason, it cannot be said that the plaintiff’s cause of. action is founded solely on a state law, and that it grows out of the act of March 1, 1877. To entitle the plaintiff to a decree, it must further show that the deeds executed by the governor covering lands — 12 — north of Watab were invalid; that the title of the state to said lands was not divested by the execution of said deeds, and that on March 1, 1877, the legislature of the state still had power to convey said lands by legislative enactment to such company as might elect to construct the uncompleted line from Watab to Brainerd. It is apparent, we think, that the plaintiff endeavors to establish the foregoing proposition that the deeds were in fact void, and that the lands in controversy remained subject to the disposal of the state of Minnesota, because of the invalidity of the prior conveyances, on two grounds. In the first place, it insists that the Litch-field agreement of date February 6, 1864, which was subsequently approved and confirmed by the state, operated as a division of the land grant pertaining to the branch line, so that neither Litchfield nor his successor in interest, the First Division Company, cotild thereafter acquire any right or title whatsoever to any lands pertaining to said grant lying north of Watab, whether they were located within the place or indemnity limits. This, without doubt, is the ground on which the plaintiff chiefly relies for the purpose of establishing the proposition that the governor acted wholly without authority in executing deeds in favor of the First Division Company for the lands now in controversy. But, in addition to such contention, plaintiff also insists, and the allegations of the bill seem to be sufficiently full and specific to furnish a foundation for such contention, that the deeds in question were also unauthorized and void by virtue of limitations and conditions found in the several acts of congress by which the lands in controversy were granted to the territory and state of Minnesota, in trust, to aid in the construction of a branch line of road from St. Anthony-, Ada Anoka, . St. Cloud, and Crow Wing, to St. Vincent. In support of this position, it is contended, in substance, that the state held the legal title to all the lands embraced in the grant in trust, and that it could only convey the same on the conditions prescribed in the seAreral acts of congress which .created the trust; that, upon a true construction of the grant, the state had no power to convey lands lying within place limits, in advance of construction, after the first 320 sections had been sold; that it had no power to con\rey lands to any railway company unless the tracts so conveyed were “included within a continuous length of twenty miles of road”; that the granting act of March 8,1857, set apart and appropriated to the construction of each consecutive section of 20 miles of road the place lands ly-ting abreast of or coterminous with each section, and that the granting act of March 3, 1865, in like manner set apart and appropriated to the construction of each consecutive section of 10 miles of road enough place and indemnity lands coterminous therewith to make ' altogether 100 sections of land for each 10 miles of road. It is insisted that the deeds now in controA^ersy are invalid, without reference to state legislation, because they were executed by the goA'-ernor of the state in violation of each of the foregoing provisions claimed to have been contained in said acts of congress. The ground first stated, on which the plaintiff company bases ' its claim that the deeds executed by the governor Avere invalid, does — 13 — not involve the consideration or decision of any federal question. In. construing the Litchfield agreement, and in determining what lands the St. Paul & Pacific Railroad Company intended by that contract to transfer to Litchfield and his associates, it might be found expedient, or even necessary, to consult the act of congress of March 8, 1857, which is referred to therein, and with reference to which the contract appears to have been executed. But, after all, the point at issue upon this branch of the case is the true construction of that agreement, and that is clearly a question of general and local law, inasmuch as the right asserted by the plaintiff depends upon that agreement, and the local statute by which it was adopted and confirmed. A case does nqt become one of federal cognizance because it may be found necessary, in construing a private contract or a local law from which the rights of the respectiva; parties are derived, to consult some federal statute with a view of ascertaining the meaning of the contract or the scope and effect of the local law. In such cases the cause of action or the defense, as the case may be, is not founded on a law of the United States in any such sense as to bring the suit within the jurisdiction of the federal courts. Miller's Ex’rs v. Swann, 150 U. S. 132, 14 Sup. Ct. 52. It is equally clear, however, that in so far as the plaintiff company challenges the validity of the deeds on the second ground above stated, because they were executed in violation of the provisions of the several granting gets heretofore mentioned, the case at bar does involve certain federal questions which it might be found necessary to decide, and on the decision of which the right of the plaintiff to recover would depend. If the plaintiff company fails to maintain its position that the Litchfield agreement, as confirmed by state legislation, operated to divide the grant and to withdraw the lauds north, of Watab from the reach of the First Division Company, or that the deeds in question were executed in violation of other state laws, then it seems obvious that the court would find itself compelled to consider the federal questions above suggested, — whether the deeds were rightfully executed under federal laws, and operated to divest the state of its title to all or any of the lands therein described which lie north of Watab. It is proper to observe in this connection that we are not concerned at present with the merits of the several propositions heretofore stated on which the plaintiff bases its claim that the deeds executed by the governor were void, and conveyed no title to the lands situated north of Wal.ab. Whether the construction that is placed on the granting acts by the plaintiff company wit h a view of impeaching the conveyances is sound or unsound, we need not stop at.this point to inquire, because the jurisdiction of the circuit court does not depend on that inquiry. If it appears, in any aspect which the case may assume, that the right of recovery may depend upon a construction of those acts, and if the right to recover so far as it turns on the construction of federal statutes is not merely a colorable claim, but rests upon a reasonable foundation, then a federal question is involved which is adequate i.o confer jurisdiction. We entertain no doubt that certain provisions contained in the several acts of congress relative to the disposal of tire lands by the — 14 — state and territory of Minnesota are of such a nature as to afford a reasonable ground for the contention that the lands in controversy were not conveyed by the governor of. the state in conformity therewith, and that the deeds were for that reason voidable, if not void. We think that the plaintiff company may fairly invoke a construction of those statutes, and that the allegations of the bill are sufficient 'for that purpose. Nor is it at all material, so far as the question of jurisdiction is concerned, that the court may not be compelled to construe the acts of congress in the respects stated, or in any other, for, as we have already shown, its jurisdiction does not depend upon the nature of the question that is ultimately decisive of the plaintiff’s right to recover. If a case is commenced originally in the circuit court, and, by a fair construction of the complaint, it appears that the plaintiff predicates his right to relief on the meaning or effect of a law of the United States, and the claim is made in good faith, so that there is a real instead of a merely colorable controversy, then jurisdiction over the case exists, even though it may appear that the right to the same relief is asserted on another ground, that does not involve the consideration of a federal question. In concluding the discussion on this branch of the case, it is proper to add that we do not concur in the view that the case is one of federal cognizance merely because the title to the lands in controversy is derived from .the United States. The bill shows very conclusively that both parties claim under the state of Minnesota, that the title to the state is not challenged, but is conceded to be well founded under the granting acts. The questions at issue all grow out of the manner in which the state dealt with the lands after it .acquired the same from the general government. Nor is the case one in which the parties are asserting rights derived respectively from conflicting land grants. Under thése circumstances it must be conceded, we think, in accordance with the decision in Romie v. Casanova, 91 U. S. 379, that a federal question is not involved in the case merely because the United States is the ultimate source of title. The jurisdiction of the court must be upheld, however, on the ground heretofore stated. The next, question in order is whether the legislature of the state of Minnesota intended to declaré by the act of March 1, 1877, that the particular lands in dispute were thereby forfeited to the state and conferred on such company as might thereafter complete the line from Watab to Brainerd, notwithstanding the previous conveyance thereof by the governor to the First Division Company. The decision of this question turns wholly upon the intention of the legislature, to be ascertained by all of the surrounding facts and circumstances, and the maxim must be applied that, no matter how general may be the language of a statute, that which was not within the intention of the lawmaker is not within the law. It is a notable fact, in its bearing upon the question now under consideration, that two of the deeds, the validity of which is denied, were executed and filed for record in the proper registry office of the state of Minnesota more than 10 years prior to the act of March 1, 1877, and that the other deed was executed and filed nearly 6 years prior thereto, to — 15 — wit, on July 28,1871. In the meantime, that is to say from August, 1.888, to March, 1877, the grantee in said deeds, the First Division Company, had sold and conveyed over 25,000 acres of the lands thus deeded to it, which were situated north of Watab, to various purchasers, who had settled upon some of the lands, and had very likely made valuable improvements thereon. It is not shown by,the record that any one had ever questioned the validity of said conveyances prior (.o March 1, 1S77, although, according to the present contention of the plaintiff company, the equitable title to much of the land embraced in the deeds, during all of said period, was vested in the St. Paul & Pacific Railroad Company, which was then a going concern, and most likely active in the defense of its interests. The plaintiff company likewise failed to challenge the several deeds for eight years after it had taken advantage of the provisions of the act of March 1, 1877, and had completed the line of road from Watab to Brainerd, and had thereby become entitled, according to its present contention, to demand a conveyance from the state of the lands now in dispute. Moreover, it suffered a period of live years more to elapse before it took the position which it now seeks to maintain, that the deeds in questiou were absolutely void when executed, and did not even operate to divest the state of the legal title. In view of these facts, it admits of no doubt, we think, that when the act of March 1, 1877, was adopted, fhe opinion prevailed generally among all persons who were aware of the existence of the deeds that they had been executed in substantial conformity with existing laws, and were valid conveyances. This belief that fhe deeds operated to convey a good title was probably strengthened by the fact disclosed by the testimony that, in executing fhe same, the governor of the state had acted under and pursuant, to the advice of the a ttorney general. It has been suggested that when the act of March .1, 1877, was adopted, the legislature was ignorant of the fact that any lands north of Watab had been conveyed to the First Division Company. This suggestion, even if it was well founded, would not determine the intention of the legislature with respect to the lands in controversy, neither would it be decisive of the construction which the act of March 1, 1877, ought to receive. The act shows very clearly that the legislature intended, by the sale of a part of the forfeited lands, to secure tfie payment of all claims that existed against: the St. Paul & Pacific Railroad Company growing out of work theretofore done or materials furnished by individuals towards the construction of the line north of Watab, and that it also intended to protect ail persons who had made settlements upon, or filed claims against, any of the lands lying within the limits of the grant between Watab and Brainerd. The tenth section of the act, as will be seen, excluded from the grant made by the state to such conrpany as might complete the line from Watab to Brainerd all lands that had been settled upon in good faith, or against which valid homestead or pre-emption claims had been filed on or before the passage of the act. It is not too much to say that the act bears the strongest internal evidence of an in — 16 — tention on the part of the legislature not to disturb existing rights or titles of any sort, but to protect settlers and all other persons who had colorable claims to the land, or any part of it. The general purpose seems to have been to vest in such company as might complete the line from Watab to Brainerd the right, on completion, to demand conveyances from the state of such lan(Is within the limits of the grant as were clearly subject to its disposal because of the existence of no outstanding claims. We can scarcely conceive it to be possible that the legislature would have been any less solicitous to protect individuals who had purchased land from the First Division Company in reliance on the title conveyed by the deeds executed by the governor, than it was to protect persons who had made settlements on the land, possibly after the definite location of the line and after the withdrawal of the lands from sale. On the assumption, therefore, that the legislature was ignorant of the existence of the deeds, yet without a more definite .expression of such a .purpose, the act ought not to receive a construction that will bring within its purview lands that had already been conveyed by the governor to the First Division Company, in the belief that it had earned the same and was justly entitled thereto. We are persuaded, however, that it is not probable that the legislature passed the act of March 1,1877, in ignorance of the fact that the deeds in question had been executed. The long period that had then elapsed since they were executed, the publicity that had been given to the same by filing them in the proper office and by certifying lists of the tracts,of land thereby conveyed to the several counties where they were situated, the quantity of land that had actually been sold, and the discussions and investigations which usually precede the passage of such legislative enactments as the act of March 1, 1877, render it highly improbable, we think, that the legislature could have been ignorant that such conveyances had been executed and. delivered, and that a portion of the land had been sold. It is most reasonable to presume that the legislature was well acquainted with the fact that certain lands north of Watab had been conveyed to the First Division Company, and that it shared in the common belief then entertained by all persons who were aware of the existence of the deeds, that they had been executed in accordance with law, and that the lands thereby conveyed would not be affected by the provisions of the act, because they were no longer subject to legislative control. From the standpoint occupied by the legislature, believing as it did, no doubt, that the previous conveyances were valid, it was both a reasonable and natural view that the language of the act granting the “lands * * * appertaining to the portion of the road it shall complete * * * formerly held by * * * the St. Paul and Pacific Railroad Company” could only be held applicable to lands then subject to its disposal, that is to say, to lands not theretofore earned or conveyed. Moreover, the execution of the deeds by the governor was an act done by him in an official capacity, and future legislatures, as well as his successors in office, were bound to take notice of what had already been done by the — 17 — executive department of the government in discharge of duties devolved upon it by law. There is another consideration to be briefly noticed which strongly supports the foregoing conclusions. The legal title to till the lands in controversy, at the date of their conveyance by the governor, was undoubtedly vested in the state of Minnesota. Tin» state had been authorized by the general government to dispose of the lands in aid of the construction of a certain line of railroad. It was obviously contemplated by congress that the state would pass laws, designating a beneficiary of tin; grant, and prescribing the manner in which the lands should either be sold by the state, or the title thereof be transferred to such company or companies as might be formed to construct the proposed road. Such laws were, in fa.ci, passed both by the territory and the state, and the local legislation on that: subject, as might have been anticipated, became elaborate and eotuplex. The execution of these laws was committed to tin’ governor of the state. He was empowered to execute deeds, from time to time as the work of construction progressed, for all of the lands lying within the limits of the grant, and in the discharge of that duty it became necessary for the governor to consider and decide whether the conditions had been fulfilled which entitled the beneficiary company or companies to demand conveyances from the state. After the 8t. Paul & Pacific Railroad Company had become segregated into two corporations by the Litchfield agreement, and by the act of the legislature approving and confirming the agreement, it undoubtedly became the duty of the governor to decide, in the first instance, how much of tlie granted lands passed by that agreement t.o the First Division Company, and whether it could lawfully lay claim to any lands, either within the place or indemnity limits, that were situated north of Watab, and, if so, to what extent it could rightfully lay claim thereto. The record discloses that some of these questions which were thus committed to the decision of tlie governor, in the course of time, and particularly in view of (tie Litchfield agreement, became complex and difficult of solution. Inasmuch, then, as the legal title to tlie lands in controversy was vested in the state, and the governor had been given power to execute conveyances therefor, and to determine, as between different companies, which was entitled to them, and whether the conditions warranting a conveyance of the same had been fulfilled, tlie conclusion follows that the deeds in controversy were not void, but at: most were only voidable. According to well-established principles, an erroneous decision by the chief magistrate of a question intrusted to him to decide cannot be said to have had the effect of rendering a deed executed by him in conformity with such decision absolutely null and void. The numberless titles in the state of Minnesota, and perhaps in other stares as well, which rest upon deeds executed by its chief executive officer under similar circumstances, and tlie very common practice of relying implicitly upon titles emanating from the state, admonish us to be cautious in sanctioning the doctrine that a mistake made in — 18 — the construction of a law is sufficient to render a deed utterly void, although the power to convey the particular tract of. land to some one is undoubtedly vested in the officer. In the case of U. S. v. Winona & St. P. R. Co., 67 Fed. 948, which has been under advisement, and has been considered by this court in connection with the case at bar, we have stated succinctly under what circumstances a patent for lands will be esteemed void, and when it will be held to be merely voidable. It is sufficient to say at present that, within the rules announced in that case, if the governor of the state of Minnesota acted under a mistaken view of the law in executing the several deeds now in question to the First Division Company, such conveyances were at most only voidable, and so the circuit court appears to have held. . . It results from this view- — that if the deeds are invalid they are at most only voidable — that we should be forced to conclude that the act of March 1, 1877, was not intended to declare a forfeiture of the lands theretofore conveyed by the governor, even if we believed it to be probable that the legislature acted under the impression that those conveyances had been erroneously executed. We would not feel authorized to infer merely from the general language of the statute, and in the absence of any allusion to said deeds or to titles acquired thereunder, that the legislature intended to declare, without judicial proceedings of any sort, that the lands theretofore conveyed by the governor were thereby forfeited to the state and granted to another company. The question now under discussion being merely as to the intent of the legislature, it is not necessary to decide whether it was competent for the state, by legislative enactment, to forfeit lands which had been erroneously conveyed by the governor, and were held by the grantee under a voidable deed, or whether the exercise of that power pertains solely to the judiciary, as was held in Fletcher v. Peck, 6 Cranch, 87. For present purposes, it will suffice to say that it ought not to be presumed that the legislature intended to exercise the authority in question without unmistakable evidence of such a purpose, and that we find nothing in the act of March 1, 1877, or in the circumstances which induced the passage of that measure, which satisfies us that such was the legislative intent. It follows, from the construction which we have felt compelled to place on the act of March 1, 1877, that the plaintiff company did not, by the provisions of that act, acquire any such title to or interest in the lands in controversy as will enable it to maintain the suit at bar. The decree of the circuit court is accordingly reversed, and the cause is remanded to that court, with directions to dismiss the bill of complaint at the complainant’s cost.