227 F. 760 | 8th Cir. | 1915
The United States appeals from a decree of dismissal of its suit in equity against E. J. Debell and W. H. Butterfield to avoid a patent dated February 24, 1908, to Pehinji, a Rosebud Sioux Indian of the full blood, for a tract of 320 acres of land which had been allotted to, and was on February 24, 1908, held by the United States in trust for, him without power in him to alienate it for 25 years after February 23, 1907, the date of the trust patent to him of his allotment of this land, and to avoid Pehinji’s deed of the land to Debell on March l7, 1908, and Debell’s deed of the same to Butterfield of July 27, 1908. The patent of February 24, 1908, was issued under this provision of Act of May 8, 1906, c. 2348, 34 Stat. 182, 183:
“Provided, that the Secretary of the Interior may, in his discretion, and he ,is hereby authorized, whenever he shall be satisfied that any Indian allottee is competent and capable of managing his or her affairs at any time to cause to be issued to such allottee a patent in fee simple, and thereafter all restrictions as to sale, incumbrance, or taxation of said land shall be removed and said land shall not be liable to the satisfaction of any debt contracted prior to the issuing of such patent'.”
The ground of the relief sought, which is set forth in the complaint,. is that Pehinji was incompetent and incapable of managing his own affairs, that Debell; who was the licensed Indian trader at the agency for the Rosebud band of Indians, of which Pehinji was a -member, W. C. Courtis, the manager of Debell’s store at the agency, and Edward B. Kelley, the United States Indian agent and superintendent of the Rosebud Indian Reservation of the Rosebud band of Indians- and of Pehinji, knew this fact, but in order to enable Debell to purchase Pehinji’s land at less than its value, they colluded to cause Kelley to represent, and to induce the Secretary of the Interior to believe, that Pehinji was Competent and capable of managing his own affairs, and to issue- to him his patent in fee simple, that Debell then bought the land of Pehinji for $2,000, when it was worth much more, and obtained a deed from him therefor dated March 17, 1908, and that on July 27, 1908, Debell sold and conveyed this land to Butterfield, who knew all the facts alleged, for the sum of $3,200. In their answers Debell and .Butterfield denied the incompetence of Pehinji, the collusion between Debell, Courtis, and Kelley; the misrepresentation to the Secretary regarding the competency of the Indian; that the land 'was worth more than $2,000 when Debell purchased it; and Butter-field alleged that he bought and paid $3,200 for it in reliance upon toe patent in fee simple and the deed to Debell, without any notice of any of the alleged facts pleaded in the complaint in derogation of Debell’s title. Upon the issues of the competency of Pehinji, the collusion of Debell, Courtis, and Kelley, the inducement and purpose of the representation of his competency to the Secretary by Kelley, the evidence was conflicting, but it was conclusive that Butterfield purchased the land of Debell and paid $3,200 for it in good faith in reliance upon the patent in fee simple to Pehinji, and upon the latter’s.
While it is true that a complainant may not, in a suit in equity, join a cause of action in equity and a cause of action at law, and that where his cause of action in equity fails on the proof he cannot recover damages or moneys that he might have recovered at law, it is also true that where tire proof sustains the cause of action in equity, but the defendant has by his course of conduct rendered the appropriate relief first sought ineffective, the chancellor may require him- to make compensation for his prevention of that relief. Where the primary relief sought is the restoration of property and the defendant has placed it beyond his and the court’s reach, the court may require him to pay the value of the property, or the proceeds he received from it, because the right to- this relief inheres in and grows out of the equitable cause of action which the plaintiff hás established. Moreover, the right to recover the proceeds springs from the immemorial jurisdiction of courts of equity to enforce trusts. One who by fraud or wrong acquires the property of another thereby becomes a trustee de son tort of that property, and holds it in trust for the owner. If he sells and conveys it the owner may successfully pursue him in equity as trustee for the property, or for the proceeds of it. If, therefore,' the proof established the plaintiff’s cause of action in equity against the defendant for the restoration of the land, he cannot escape accounting for the proceeds he obtained for the property, or the value thereof, on the ground that he placed the land itself beyond the reach of the court.
“that he [Dobell! had worked to get this up for you through the lawyer, and if you clo not do this, get this up he would — you would have some mishap or something happen to you, or some mishap or something terrible come to you— that something would happen to mo, or mishap, or get myself into trouble because lie had a hard time to got that thing through, through the lawyer.”
Tod Smith brought Pehinji to Debell’s store at the agency in the wagon. Pehinji testified that Debell talked to him through an inter- . pretor, and said to him;
*‘I will help you out and you will eat off the $2,000 and you will get the rest when the patent comes, but I do not know how much that will be.”
Pie testified that Debell then wanted him to touch the pen, but he told him:
“No, I don’t want to touch the pen here, and the only place we touch the pen is over to the agent’s office; that we had betler g’o over to the office and I will touch the pen there. Capt. Allison spoke up and says that would not make any difference if you touch the pen a hundred times. Then I says: ‘You are after this piece of land yourself, and I do not want to do anything on the sly. We had bettor go over to the office, and I will touch the pen there.’ Then I knew he was going to possess the land, so I touched the pen there in the store. * * * They sent an order over there on the other store, and the other storekeeper brought the patent down there, and they gave him about $22 for bringing it down. Then of course it was in his possession, and that is how I touched the pen.”
He testified that he never went to school; that no one ever taught him to count money; that he did not know the names of the months; that he did not know how many acres there are in a quarter section,
The date of the deed and the date of its acknowledgment is March 17, 1908. On the account book of Debell Pehinji is credited with land $2,000 under date of January 8, 1908, and under the same date he is charged with cash order to Mrs. Flood $50, and one cowboy saddle $50, and the sum of the items charged against him upon this account, from day to day between January 7, 1908, and March 17, 1908, is $476.50. Debell testified that He made the entries in this account himself; that they are on the book of original entry; that he kept books of account; that sometimes he made entries when the transaction occurred, and sometimes he did not, but that he set it down at the-time in Pehinji’s case. When his attention was subsequently called to the date January 8, 1908, of the credit of the $2,000 for the land and of the charge of $50 for Mrs. Flood, and to the date March 17, 1908, of the deed and of its acknowledgment, he testified that he was not sure about the books speaking the truth as to the dates; that he knew there wasn’t any money paid until he got the deeds; and that he could not give any explanation of the appearance of these items
Mrs. Flood testified that she received $50 at the store of Debell before the patent was delivered; that she did not get any money before the deed was delivered; that she thought she received the money in January, but that she could not remember in what month the deed or the patent was delivered; that the ¡latent from the government to Pehinji was taken to Debell’s office after the deed was made; that she was at Debell’s store once with Pehinji; that she signed the deed as a witness; that that was the time that Tod Smith went after the old man to his place and brought him back there and asked her over to Debell’s; that Debell wanted to know why he did not take his patent to Debell’s. That Pehinji thought he could sell it and do better, because he was not getting enough; that Debell told him he had bought the land already, and he could not take it to any one else.
Courtis, the notary who took the acknowledgment of Pehinji’s deed, testified that the date of the deed and that of the acknowledgment were put in on March 17, 1908, when it was executed; that he was employed by Debell; that he sent Tod Smith for Pehinji; that Mrs. Flood and Tod Smith were present; that the deed was executed before the patent was delivered; that Pehinji and Dehell had a talk about the sale of the land which he heard prior to March 17, 1908; that he heard Dehell offer Pehinji $2,000 for the land at that previous talk; that he was not sure whether or not Mrs. Flood was present at that time; and that he thought Pehinji was capable of managing his affairs.
William F. Schmidt, issue clerk under Kelley, testified that he knew Pehinji, that he was incompetent to attend to his affairs, and that it was part of his duty as issue clerk “to list all the uoticompetent Indian lands for sale.”
Charles L. Davis, special Indian agent inspecting, testified that he became acquainted with Pehinji in April, 1909, while engaged in investigating sales of Indian lauds; that he took two statements from him; saw him in Aberdeen in 1909, and heard him testify in this case; and that he deemed him incompetent. Maj. J. B. Woods is the successor of Kelley as Indian agent. He testified that he first saw Pehinji in 1909; that he had known him about a year at the time he was testifying; that he had talked with him at different times; that his conversations were through an interpreter; that he is one of the old style Indians, entirely uneducated; that he cannot speak, read, or write, the English language; and that he does not believe he was competent or capable of managing his own affairs in 1908. Many witnesses testified relative to the value of the land in March, 1908, and their estimates varied from $2,000 to $4,000, but the weight of the evidence was that the land was worth about $2,000.
“Sir: Inclosed herewith'is the trust patent to the allotment of Pehinji or Yellow Hair, together with his application for a patent in fee simple in lieu thereof. Yellow Hair is an honest, deserving and good old Indian of full Mood. He is and has been for years a faithful friend of the government and I consider him worthy to'be intrusted with a patent in fee simple, and I therefore recommend that his request be granted.”
On this letter the Secretary.of the Interior caused the patent in fee simple, dated February 24, 1908, to be issued to Pehinji and that patent was first delivered to him, as his receipt to Kelley proves, on April 28, 1908, more than a month after his deed is dated. There is other evidence in the record in this case, but it is not of sufficient materiality to modify the result which that which has been recited must induce.
The strong presumption in favor of the finding of the court below has received consideration and due weight in this case. In view of that presumption and finding, the evidence in this record has been read and re-read. It has received deliberation and meditation. The result is that it has led the court to these conclusions: In January, 1908, the United States had decided in February, 1907, that Pehinji was incompetent and incapable to manage his own affairs and especially to manage the sale and the care and disposition of the proceeds of the sale of his land, and that he .would be thus incompetent for 25 years from that date, and it had issued its trust patent and agreement dated on that day to hold his land for him and his heirs during that time. The legal presumption was that that decision was just and-right and that he was less competent in 1908 than he was in 1907, for he was 76 years of age when his trust patent was issued. An Indian 77 years of age, who has never had any property except that issued to him by the United States, who has been under the charge and care.of an Indian agent, who has never had any business or experience in selling land, or caring for or disposing of the proceeds thereof, or in handling any other property except the small amounts issued to him by the government to sustain ‘life, who has no property except 320 acres of land held by the United States in trust for him, without power in him to alienate it, who has drawn his monthly rations from the government for 20 years and is still
Counsel for Debell argue that Kelley did not represent to the Secretary by his letter that Pehinji was competent or capable to manage his own affairs. He stated that Pehinji “was worthy to be intrusted with a patent in fee simple,” and he stated this in order to induce the Secretary to issue one, when the only condition on which he could lawfully issue one was that Pehinji was competent and capable of managing his own affairs, and the Secretary was the quasi judicial tribunal in which the power was vested and upon which the duty was imposed to hear and consider the evidence and adjudge the issue whether or not this condition existed. The Secretary decided on this representation — and that fact raises a perfect cause of action in equity —to set aside the patent as against Debell, who knew the incompetency of Pehinji, whether Kelley’s letter was or was not a representation of his competency. If it was the former it was a fraudulent representation, for Kelley could not have failed to know that Pehinji was incompetent, and the United States had the right to the avoidance of the patent by the proper court of equity as against Debell. If it was the latter, then there was no substantial evidence of Pehinji’s competency before the Secretary, and his adjudication without substantial evidence to sustain it was an error of law which likewise vested in Pehinji and in the United States a cause of action in equity to avoid the patent in fee simple upon that adjudication. Whether or not there
Counsel for Debell contends that the Commissioner of Indian Affairs declared that the test to- determine whether or not an Indian was competent and capable to manage his affairs, and especially to sell and convey his land and cafe for and manage the proceeds thereof under the act of Congress to which reference has' been made, was not whether he was competent to manage them with some reasonable degree of prudence and care, but whether or not he would know what he was doing when he should make a deed, and whether or not he would be aware that when he once parted with his property by executing his deed he' could not recover it again, and counsel argues that by that test Pehinji was competent. If the Secretary of the Interior determined the competency of this Indian by any such test, he committed another error of law, for a person might know he was making a deed to his property, and that after he made and delivered the deed he could not regain his property, and yet.be utterly incapable of managing his affairs, the sale of his property, or the care or disposition of the proceeds. It is indispensable to that competency and 'capability to manage his affairs which conditions the right of the Secretary to issue a patent in fee simple to an Indian under 'the first proviso of section 6 in chapter 2348, 34 Stat. 182, 183, that he shall have at least sufficient ability, knowledge, experience, and judgment to enable him to conduct the negotiations for -the sale of his land and to care for, manage, invest, and dispose of its proceeds with such a reasonable degree of prudence and wisdom as will be likely to prevent him from losing the benefit of his property or its proceeds.
Either before or after the issue of the patent in fee simple Debell induced Pehinji to convey the land to him, and between January 7, 1908, and July, 1908, paid him, in various amounts of money, goods and moneys paid out on his order, sums which aggregated $2,000. On July 27, 1908, he conveyed this, land to Butterfield, and received $3,200 therefor. Knowing, as he could not have failed to know, that Pehinji was incompetent and incapable of managing his own affairs, and especially of selling his land and managing the proceeds thereof with any reasonable degree of wisdom or prudence, and that the patent in fee simple and the deed to him were evasive violations of the settled policy of the nation to preserve and protect incompetent Indians from the conveyance or loss of their property, of the acts of Congress which evidence this policy, and of the express restriction on
The decree of dismissal of this suit must therefore be reversed, and the case must be remanded to the court below, with instructions to render a decree to the effect that, as against Debell, the patent in fee simple and the deed of Pehinji be set aside, and that the defendant Debell pay to the United States, within 60 days after the entry of the decree, $1,200 and interest thereon from July 27, 1908, and the costs and disbursements of the suit, apd that if he fail to pay these amounts within that time, the United States have judgment and execution to enforce their collection, but that, as against Butterfield and all parties claiming by, through, or under him, the patent in fee simple and the deed of Pehinji are valid and conclusive, that the notice of lis pendens in this suit be canceled, and that the complainant is entitled to no relief as against Butterfield. The decree may also contain such other provisions not inconsistent with the views expressed in this opinion as the court below may deem fit; and it is so ordered.
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