UNITED STATES

V.

IUOUX CITY

&

ST.

P. R. CO.

617

the removal was petitioned for, a citizen of Iowa, and Murray Nelson & Co. was a corporation created under the laws of lllinois. C. E. Myers & .Co. are named as defendants, but their interest is identical with that of complainant, the controver::>y in the case being between C: E. Myer£! & Co. and Theodore H. Brown, on the one hand, and :Murray Nelson & Co., on the other, between whom the requisite diversity of citizenship is shown to exist. W. L. May is declared against merely as the agent of the corporation. No relief is asked against him, and it dearlyappe!trs that he is purely a nominal party; and the same is true of the remaining defendants, Bell, Ditnmick, and Nutter. Their appear in the caption of the bill, but they are not otherwise named or mentioned. hence there is nothing appearing on the face of the rec;" ord showing that they have any interest inthe controversy. Being merel),' nominal .parties, their presence does riot affect the jurisdiction over. the actual cbritroversy involved. Wood v. Da'vis, 18 How. 467; Bacon v: Rives, U. S. 99, 1 Sup. Ct. Rep. 3. In the Dill filed, it is averred, ilotOrily that Murray Nelson & Co. is an llJinois corporation, but also that it is' a non-resident of Iowa, so that it appears upon the face of record that the petitioning corporation is not only an Illinois corporatic)ij, but that it· is also a non-resident of Iowa. The motion to remand is overruled.

UNITED STATES

V.

SIOUX CITY & ST. P. R. Co. et al.

(CtrcuttCourt, N. D. Iowa. W. D. October Term, 1890.)
1. PtmLIC LANDs-RAILROAD AID GRANT. Act Congo May 12, 1864, granted to tbe state of Iowa, for tbe' purpose of aiding in the construction of a railroad from Sioux City to the Minnesota state line; and from a:point OD such road to South McGregor. every alternate section of land for 10 miles from such roads not otherwise dispelled of. with indemnity for such o1isposed-Of land. The former road was built, except a part where all the granted land had been previously sold. Held., that said road was only entitlAil to such part of the grant as was proportioned to the part of the road tbat was bunt. . II. SAME. Said rOQ,d having been decreed to be entitled to only a moiety of the land included in the grant to both roads, it is entitled to indemnity fdr the moiety thus lost.

In Equity. Bill for adJustment of land grant. . . W. H. H. Miller, Atty. Gen., E. O. Hughes, and W. L. Joy, for complainant. J. H. k 0. M. Swan. for defendants. . SHIRAS, J. The congress of the United States, by the act approved May 12, 1864, granted to the state of Iowa, for the purpose of aiding in the construction of a· railroad from Siou:x. City to the south line of the state of Minnesoia, to such point on said line as the state of Iowa might select. between the Big Sioux and the west fork of the Des Moines river, and 8ls0 a line of railroad from South McGregor, in said state, running

618

FlWERAL REPORTER, .;

vol. 43.

westerly on or near the .fortv-third.parallel of north latitll<le, to a point of with the line in the county of O'Brien, ev"eryalternate section Oflalld by odd numbers for 10 sections in width on, ,each side not sold, pre-empted, or otherwise ,it being further prmrided that, for disposed ofby the everysecUon or part therei:>f.sold .01' disposed of by the United States, of the interior should select in within t,b El lO-section lieu thereo(,froDl thepuplic lanq,s of the United States nearest to the tiers of. sectjops first. within 20 miles of the located line of railroad, aDd in.cluded iQ tlle,'alternate odd-numbered sections or pints be, equal to the lands aold, reserved, or States within the fO-section limit. .. . . . of. Its .general assembl. y , a,'ccepted the gra,nt ... T he sta,te.of.IO.W.a, bY,a. .thus maqe,'ll,nQdesigrlate,d the'Sioux City & St. Paul Railroad, Company of the as thesameprovic;led,forthe buildas the ing ofa road from Sioux City to the Minnesota state lille. : That company accepted the grant, and On the 2.7th day of September, 1866, commenced the location ofit{Xine fli<>m Sioux City, complethig the'survey by bctober 4, 1866 i and on the 2d day of thereof to the secretary ·of of April,. 1867, i,tcausedtp;be .6Iedinthe office of the state ottowa a duly certIfied map of such location, and on the day of July, 1867, this map, with the certificates of the governor and secretary of state of Iowa, was filed in the office of the secretary of the interior at Washington. On the 26th day of August, 1867, the commissioner of the general land-office of the United States transmitted to the local land-office at Siol1k City a map showing the location .of said line of railway, together with the 10 and 20 mile limits marked thereon, with an official letter'withdrawingtha lands numbered by odd sections from to entry or sale, and increasing the price of the even-nUmbered $2.50 per acre. In theyeali the railroad company inade.andfiled in the land-office at SiouxCity:selectiolls of all the lands undisposed of 1n the odd-numbered the 10 and 20 mile limits, which selections amounted to 407,870 21·100 aores. In the year 1872 the company commenced the cotlstruction of the line of rttilway, beginning at the Minnesota state line, and progressing southwardly until the line ! reached the town of LeMars, i# Plymouth county. In the months of July and August, 1872, and November, 1873, the governor of Iowa filed with the secretary of the interior certificates showing the construction of ,,5 sections of 10 miles each of said railroad, and on the 16th day of Oct!?bel', 1872, and the 25th day of January, 1875, the Recretary of .the interior caused patents to issue to th El of Iowa for all the lands selected within the place and indemnity limits of said grant, covering 407,870 governor of)Qwa, on behalf of th!l executed ,deeds to t,he,rail,,,,ay COUlJlany for 81-100 acres of these lands. ,In 1879, a suit,ln equitY,iWas br<>llght in the U[}ited States circuit court for the. 'lif IQwa,on',behalfofthe Chicago, St. Paul as tpl;l succesSOr of the McGregor & Western Railroad ,c::ornpany, which pad to the lands granted forthe build0 . , .
o' . . · · ', ·

UtolITED StATES V.SIOUXCITY &,'ST.'·P. R. CO.

619-'

ingof the line from McGregor to the point of intersectibn with the 'Sioux! City line, against the Sio.x City & St. Paul Company,for the purpose of settling,the rights of the respective companies to the lands embraced within the overlapping limits ofthe two grants, when the lines ofraihvay approached each other. The supreme court of the United States held that the grant must be construed to be, within the overlapping limits, a grant in common, and that each company was entitled to one-half the lands; that the lands within the lO-mile limit of each road were to be equally divided, as well as the indemnity lands outside the 10 but within the 20 mile limits of both roads; but that neither company, in placing indemnity lands, could invade the 10-mile limitofthe other company. Sioux GUy & St. P. R. GU. v. Chicago, Jl;I.& St. P. Ry. GU., 117 S. 406,6 Sup. Ct. Rep, 790. Based upon this ruling, a decree in partition was entered in the case, which had the effect of ,conveying to the Chicago, Milwaukee &; St. Paul Company 41,687 52-100 acres of the land which had been previously deeded by the state of Io\va to the Sioux City & St. Paul Company. Deducting these, there remains of the lands deeded to the defendant company 280,725 29-100 acres, which it has sold or disposed of; and the title to which is not questioned. Of the 407,870 2l-100acresof selected lands conveyed to the state of Iowa in trust under the provisions of "'aid grant, there remain undisposed of 800 acres in Diokinson county, and 21,179 85-100 aoresin O'Brien county, which the state of Iowa re.uses to convey to the railway company, .' that the same has not been earned by the defendant company. The time limited in the act of congress ofMay 12, 1864, within which the sta.te of Iowa was to cause the building of the lines of railway· named in the act, has long since passed by, and no further rights to theJands under that grant can he herealter acquired by any action on part of the state or the railroad company. The bill in the present cause was filed under the provisions ofthe act of congress of March 3, 1837, providing for the adj us{nlent of land grants in· aid of the construction of rail.. ways, and the forfeiture of unearned lands; and ,the issues presented re'-! quire RcoDstruction of ,the, grant in question 'in order to determintl the lands to which the defendant company has become entitled. Counsel fully and ably discus!':ed the questions for the respective parties have involved, and have submitted to the court well-digested briefs of the' points and the authorities relied upon. I shall not attempt to touch upon. all the. points and, authorities thus presented, but !'shall confine myselt'to a statement of the conclusions reached upon the few general point/!' which, as I conceive it, must control the rigbtsof the parties. In construing grants of the nature of the one 'now in question, the object sought to be accomplished must he ever bornein mind, for this is what the subsidiary provisions of the law are intended to accomplish. As is said by the supreme court in Rm:lroad Co.v. Barney,1l3U.:S. 618,5.Sup. Ct·.Rep. 606, these land grants "are to receive'such a construction as will carry out the ,intent of congress, however difficult:it might be to giveJull effect to the language nsed, if the grants wateby instruments of private conveyance. To, ascertain that intent,. we' Diust:

G2Q

, .' .FEDERAL REPORTER I

vol. 48.

lookito the\:lOndition of the country when the acts were passed, as well as to the purpose declared on their face, and read all parts of them together." Can there be any doubt of the purpose which congress had in view w1;len it passedtbe act making the grant in question? Was not /luch pUrpose to secure the construction of a line of railway from Sioux state line'? This is the purpose declared upon the City face of the act, as well as the one which all the other circumstances cJ.early indioate. To accomplish this purpose, congress was willing to grant all the public lands, not otherwise disposed of, found within the by odd numbers within 10 miles of the 10cated'liI;te of railway, with the right to select, within a limit of 20 miles fr,om the odd-Qutnbered sections, such quantity, if the same could be (oun<lnot otherwise as should equal the number of acres f;ulingwitbin the 10-mile Umitexcepted from the grant by reason of hjl.ving been sold or otherwise disposed of by the United States. There is' l1QguarJnty by the, United States that the quantity of land covered by .should equal any fixed number of acres,. eithex: for the co.nstruqtim:;l. of the entire road or 'any portion thereof. The extent of $e:glillnt and the 1.imitation8 thereto are fixed by the terms of the act, is D(> attempt to state theuumber of acres that the grant would iJ.l,fact cover, apd the exceptions named in the act clearly show that it that the company undertaking the construction of the line qf p,roposedrai1way must he content with whatever quantity of land it was l,11timately1oU.J.)d wiiSoovered by the. grant, and in fact conveyeel by i,t.. ·. of lands, whatever the number of acres, the United the purpo!;1eof. securing the building of a line of railW\lY from Sioux City to :Minnesota state line, and the defendant compjl.ny:, iw.lwn it: accepted the grant, undertook to build that line, and not a part of it.' To ,entitle the company to the entire quantity of lands covpy' the,gran.t, whether more or less, it was required to build the lipe of,lioa<lnamed. ,Part performance on its part would not entitle it to performance on the part of the United States. The Q9mpany, having tailed to build the entire line, could not, equitably, qernand for morethanithe number of miles actually constructed, a,p,dthis muoh the United States is willing to concede the company may facUhat, in the third paragraph <if the act of congress, the cornpletion of each section{)f10 miles, the ipterior should issue to the state of Iowa patents.for 100, lof lan<l for the of the oompany,oannot. when read in connection :wiih the other sections.ofthe act, be construed to mean that, building, oi,lO miles, the company absolutely earned the 100 The work; .contracted to be done was an .entirety, to,wit, the Siol1x City to the southem boundary of Minnesota, andtbe. to pe, paid by the United States was the total number of acrel? pf:1fl,nd·(J()vered by the grant, and the provisions of. paragraph 3 <l;ulyfbt the Jiml'lfor partial payments to be made, and are not intended phllyge the cleal'meaning of the granting dlluse of the act. It must \>,ll)w}d,th.at thecornpany to such; portion, of the
i

o

·UNITED STATl1:SV. SIOme <-'lTV &:

P. B. CO.

621

lands actually covered by the grant as the number of miles ohoad actually constructed bears to the total length of the located line from Sioux City to the southern boundary of Minnesota. On behalf of the United States it is claimed that the company is limited in its selections for each 10-mile section of completed road to the lands found within the 10 and 20 sectidll limits of each completed section. Whatever might be the limitation, when selecting the lands as each 10 miles was completed, I do not think any such restriction is applicable upon a final settlement of the rights of the parties. As I construe the grant, congress agreed to give, in consideration of the building the entire line of road, a quan. tity of land equal to the amount of the alternate sections within a limit of 10 sections on each side of the located line throughout its entire length, provided such quantity could be found within the 20-mile limit.' The grant is not, so many acres for each niile, or each section of 10 miles, but so much for the entire line. ·If the contention of the United States in this particular is correct, it would follow that, if the company had built the line from Sioux City to Le Marsooly, it could get Doth'; ing, as, in effect, there were no lands coterminons to that part of the line on which the grant could act. If the building of the line from Sioux City to Le Mars would not have earned any of the grant, for the reason stated, then the building therooffrom Le Mars to the Minnesota' line would earn all that the grant covers;' and this is what is claimed by the company, and is resisted by thelJnited States, when applied totha actual state of the cal'le, which is, thatthti company, finding that the grant would not cover land,S over the. entire length of proposed. road, built the road southwardly from the Minnesota line, going no further tha.nthe town ofLe Mars. The conclusion reached on this point is that the right of selection extends over the entire length of the proposed road, and is: not limited to the tiers of sections coterminous to the line of railway actually builL I This view practically disposes of the next point at iEtsue the parties, which is, whether the defendant cOIrlpany can make claim to into the demnity for the moiety of ,lands which kee& St.:PauIRailway Company under the decision of the supreme 790. court in the ClI,Se already cited from 117 U. S. 406, 6 Sup. Ct. were; , On behalfoftheUnited States it is argued that, as the made in one act,.:it must have been the intent to limit each company to a moiety thereof, 'and that by mere construction the grant should not be extended beyond the fair import of itslanguage.. The terms of the'grant..: however, explicit, and embrace every alternate section along the. eri.; tire length of the road within the limit, with the proviso that if, upon thed.efinite location of the lirie"it was found that the United States had :sold or permitted pre-emption or homestead rights to. attaoh to any of these alternate l'Iections, or that the same had been reserved- by: the United States for any purposewhatever,then indemnity laridsjshould. Uponthe:Iocation be selected in lieu thereof,within the 20-mile of defendapt'sline, it was found that a :moiety of .the alternate sec.tiOh'S had been 1leServed by, tpe Vnited States for the,puliwse ip;:
I

,<,',

'.FEDEBAL REPOnTER.

vol·. 43.

constructiGU ··of:aJ1(i)thm:' line. of:.railway, and, hence, to replace these lands; the' defeJidantaompllny could: resort to theJands; within. the limi'tisIO£i:he grant lying outside of those passing to the Chi()ago, Milwaukee &St.Paul Railway Company.· If the grant to the McGl'egor line bad heen:iuade by allotheract ofcongress, it could not be claimed that it did not resellvelandswithin the,meaning of the exception found in the present:adh9asto entitle the defendant eompany to ,claim iJ;lde01nity therefor, and, the mere titctthat the two grants are foutl,d in one act of congress,instead of in two,' does not.chal)gethe result in this particular. I hold,therefore, that thl:t .grant isnotlimited to one-half of tbe alternate sectionsJound within the overlapping limits of the two grants, and that the defendant company is:entitIed to make claim for the proper portion ofthe lands that were resen'ed for the McGregorroad, and which passed to the Chicago" :Milwaukee & St. Paul Railway Company. As already stated, in . the year 1867, the, commissioner of the general land-office transmitted, to the locallalld-office at Sioux City au .official map showing the located line ofthe. railway, and the 10 and 20 mile limits therefrom.In 1887, a succeeding cotnmissioner of the general land-office prepared another map,which, to some extent, changes these limits, and the question is mooted which should be followed in adjusting the rights of the parties. It may be .true, as cla.imed, that the; later Illap is the more accurately drawn, but it not being claimed that the original map is in .any ·way affE'ctedby lraudorserious mistake, I think it should govern in ascertaining the rights of the parties. It was made at the thneitbecame necessary to. define the limits in question. It presents or represents the view· orthe· land department at that time, and must be held to have governedandcontroUedthe local lantl-office aild all third partiE1s since its execution., It is impossible to now knowhow many titJesand rights, 'are based thereon, and it is al ways unwise to discredit, without good reason, documents whiC'h have been accepted and acted upon by 'the :oommunUyat large. As an original proposition, under the in selecting indemnity lands within the 20mile Hmif" it was the duty. of the secretary of the interior to make the selections fl'.om, the to the place limits; but if by anymElans .otherselectionswere il1 fact matle and patented to the state, andby:the.state to the.defehullhtcompany, that fact cannot be availed of by; the defendant as adelense to the present bi!l·for a. proper and equitable ;adjustment of the ,rights of the parties. The defendant has no right:to.·anlYi of these lands,:except as they may have heen earned under the terms of the grant,iandit .cannot be heard to .say that any of them were ,wrongJysclected,.si>JiJngasitclaims them under the grant. The act ofcongress: of March :3, 1887 j on. ,which this suit is based, makes it the duty rot"the department oodofthe courts, in dealing with this matter ofthe,readjusth:H,>ntof these land grants, to carefully protect the rights and. equities: of actual setltlets., Herice, the'ru]e should be followed that in making '8ueh:adjustmslilt, so' far as: itinay he possible to do so, actual settlers shall not bedepri ved :of.their farms or homes, even if; to do so, itma:r ltlquuetheca:pportionment to ,the company ofasectionor other

E:ELLriER V· .MUTUAL LIFE

'co. OF.

NEW YORE:.

quantity oflan.d within.the indemnitylimits, which would noHall within the nearest,tiers of Elections. I have thus indicated the conclusions I but have reached upon the, general propositions discussed by have not attempted to deal with the question of details. If, in the application of these rules to the special facts, counsel cannot as to the results, such differences must be hereafter presented; but I trust the foregoing opinion is sufficiently explicit .to enable ·counsel to frame a proper decree:thereunder.

j'

KELLlttR tJ.

MuTU'ALLtFE!NS.

CO. OF NEW

YonL

(C'rouU courl;D. New Jersey. Beptember28,1890.)
1.

!

Where a complainant makes no reply to the pless filed by. defendant, but sets them down for argument, the truth of all the facts stated in thEliD and well pleaded i .is admitted, and no o1;>jection Qan be ma411 to,their form or
Slll;B-PLEA-SUFFIPIlINCY.

TO REPLT-EE'FBQT.

. .

·...

..

ll. .

A bill to ascertain the surret!dei' value of a policy of insurance' upon the life. of complainant alleged that the principles and methods of the appol'tionment made by defendant of its surplus funds failed to award to complainant's policy the ·amoul!I·t equita1;lly due, to it.. Held, t4a,t a plea alleging thllot complainant a!'\:reed to ratify any plans ad()pted by tile company for the equitable distribution of Its surpluilani! profits was not an'answer; 'for, if the methods adopted resulted in an ineqUitable division, as alleged, it was not the method complainant agreed to ratify.
'

8. LIFE INSURANOB-CONDITI.ONSOF POLIOY-PAYMBNTOF P·REMIUMS. .

Where a life iqsurance .policY is conditioned. that, if the premiums be .Dpt paid when due, the consid\!ration 01 'the contract shall be deemed to have failed, .snd the companyshall'bereleased: from all liability, afailure to perform the condition opellates as sformalreiease to:the company of all its liabilitl iln<1er the policy, snd precludeli\ any relief in li\quity 1:Iy a bill for accounting·
.. .·. . . .. . .

.. SAME-RESCISSION.

A Cllloimthat the non;paymeI\t of the premiums wall simply a rescission by the "policy-b'6hfer of the contract. induced Dythe discoverydf 'Imeged trauds on ,the part of the company, cannot be sustained, where it appears that he has had tb.e benefit of an iDsurance upon his life for 10 years at a rate of premium fixed upon the hypbthesisthat tb.e premiUIX1swould be paid for a llluch:}onger period.

InEquity. Bill to ascertain value of life insurance policy. , B.A. Vail, for complainant. and Robt. Sewell,' for defendant.
GREEN; J. The bill of complaint in this cause has for its prime objectthe ascertainment of the value of a policy of insurance taken by the complainant upon his own life in the year 1878, and surrendered, as the 'bill alleges, to the defendant corporation in 1888. The bill states the making of fhe coh'tract of insurance by the complainant and the defendant, whereby, inconsideration of the payment of $96.95 to the defendcorpoiation,llnd of the: further payment, to be made at the offiee 'Of sum on the 7th day of January andJllly in 'the of the r dgl111g the the coptract, the defelldan,t ;agreed that it would pay to the complah1aut on the 7t4 of; 190.3,