Wells Fargo Nevada Nat. Bank v. Barnette

298 F. 689 | 9th Cir. | 1924

GILBERT, Circuit Judge (after stating the facts as above).

We do not find it necessary to inquire whether under the facts as found by the trial court, the duress was in law such as to render the conveyance voidable. It may be said, in passing, that according to the evidence no duress was practiced by the receivers. Nor is it suggested by pleading or by proof that either the receivers or the great majority of the creditors of the bank were aware that duress had been practiced, or that undue influence had been exerted, to obtain the deed. The reported cases hold that- where the grantee of the deed has not instigated the duress, or connived therein, or had knowledge thereof, duress by others is not ground for avoiding the conveyance. Rogers v. Adams, 66 Ala. 600; White v. Graves, 107 Mass. 325, 9 Am. Rep. 38; Green v. Scranage, 19 Iowa, 461, 87 Am. Dec. 447; Sheard v. Laird, 15 Ont. App. Rep. 336.

We are of the opinion, however, that the court below should have dismissed the appellee’s bill on the ground of her laches in instituting the suit. Granting that there was local pressure, duress, and threats on the part of certain depositors interested in securing the payment of their claims, and that under such duress the appellee joined in the conveyance, the duress terminated upon her return to Los Angeles in March, 1911. We say terminated, because we are not convinced that the fear that she may still have had that her husband would be prosecuted criminally continued to operate as duress in law. She acquiesced, so far as the record shows, in the transfer of her property from the date of the deed until she brought her action in the Alaskan court in November, 1-914. In the meantime, to her knowledge, the property was being administered, sold, and disposed, of and the proceeds distributed by the receivers. Nothing was done in her suit in Alaska during the period of 3 years and 8 months. She then caused it to be dismissed. The institution of that suit had no effect to excuse laches in bx’inging the present suit. It is well settled that the mere institution of a suit does not of itself relieve from the charge of laches, and if there is failure of diligent prosecution of the suit the consequences are the same as though no action had been begun. Johnston v. Standard Mining Co., 148 U. S. 360, 13 Sup. Ct. 585, 37 L. Ed. 480; Willard v. Wood, 164 U. S. 502, 525, 17 Sup. Ct. 176, 41 L. Ed. 531; O’Brien v. Wheelock, 184 U. S. 450, 482, 22 Sup. Ct. 354, 46 L. Ed. 636; Drees v. Waldron, 212 Fed. 93, 128 C. C. A. 609; United States v. Fletcher, 242 Fed. 818, 155 C. C. A. 406; Northrup v. Browne, 204 Fed. 224, 122 C. C. A. 496.

The delay in bringing the present suit is therefore that by which the appellee’s laches are to be measured. That delay was 7 years and 4 months. Under the statutes of limitations of C_alifornia such an action had long been barred. In Bowman v. Wathen. 1 How. 189, 11 L. Ed. 97, the court quoted with approval from Beckford v. Wade, 17 Ves. 87:

“Courts of equity by their own rules, independently of any statutes of limitation, give great effect to length of time, and they refer frequently to the statutes of limitation, for no other purpose than as furnishing a convenient measure for the length of time that ought to operate as a bar in. equity of any particular demand.”

In Badger v. Badger, 2 Wall. 87, 17 L. Ed. 836, the court said:

“There is a defense peculiar to courts of equity founded on lapse cf time and the staleness of the claim, where no statute of limitation governs the case. In such cases, courts of equity act upon their own inherent doctrine of discouraging, for the peace of society, antiquated demands, refuse to interfere where there has" been gross laches in prosecuting the claim, or long acquiescence in the assertion of adverse rights.”

It is true that a federal court of chancery is not bound by a statute of limitations, but it usually recognizes as of persuasive force the statute of limitations applying to cases of like character. In Godden v. Kimmell, 99 U. S. 201, 25 L. Ed. 431, it was said:

“The rule still is that, when a party has been guilty of such laches in prosecuting his equitable remedy as would bar him if his title was solely at law, he will be barred in equity, from a wise consideration of the paramount importance of quieting titles.”

The rule so declared is well grounded in the decisions and has been applied in numerous cases in which the federal courts have held that, while they are not bound by the statute of limitations, they will usually act or refuse to act in analogy to the state statutes of limitations applicable to cases of like character. Kelley v. Boetcher, 85 Fed. 55, 29 C. C. A. 14; Davey v. Dodge, 213 Fed. 722, 130 C. C. A. 236; Newberry v. Wilkinson, 199 Fed. 673, 118 C. C. A. 111; Smith v. Smith, 224 Fed. 1, 139 C. C. A. 465.

In numerous cases laches have been held a bar, where the delay in applying for equitable relief has been less than the time limit of the statute of limitations. In Harwood v. Railroad Co., 17 Wall. 78, 21 L. Ed. 558, delay of 5 years on the part of stockholders of a railroad company in bringing suit to set aside judicial proceedings under which the company’s property was sold was held laches such as’ would bar relief. In Baker v. Cummings, 169 U. S. 189, 18 Sup. Ct. 367, 42 L. Ed. 711, it was held that 3 years’ delay by the plaintiff, in a case where to his knowledge the defendant was proceeding to prosecute certain claims as his own, debarred the plaintiff from proceeding in a court of equity to assert his rights. So in Patterson v. Hewitt, 195 U. S. 309, 319, 25 Sup. Ct. 35, 37 (49 L. Ed. 214) the court observed that in some cases the diligence required is measured by “months rather than by years,” and that “a delay of 2, 3, or 4 years has been held fatal.”

If we adopt the rule, which some courts have broadly affirmed, that lapse of time does not constitute laches unless some feature of inequity stands in the way of granting equitable relief, we find that such inequity clearly appears in the present case. Neither the depositors nor the receivers asked for the conveyance. Indeed, the receivers refused to accept it when tendered. Against their judgment they were compelled by the court to receive it, and the court’s order was the direct result of the appellee’s urgent petition. Under oath she and her husband represented to the court that they desired to convey the land to the receivers in trust for the payment of the depositors. So far as the record shows, the receivers were justified in believing that the appellee, in thus surrendering property which had been given her by her husband, was inspired only by her desire to assist him in paying his debts. Immediately after executing the conveyance, the appellee returned to her residence at Eos Angeles. There was no duress thereafter. If she continued for a time to fear that her husband might be prosecuted, that fear was not, in law, duress which would justify her failure promptly to assert her rights. She made no objection to the sale of her property by the receivers. In the year 1914 she joined in the conveyance of some of her property which had been sold by the receivers. She stood by for more than 7 years and permitted the estate to be administered. During her delay conditions have changed, and it is reasonable to assume that to the appellants' disadvantage some witnesses have died and others have drifted away from the jurisdiction in which the transactions here involved occurred, and could not be brought to testify in the court below in a jurisdiction 3,000 miles distant from the place where the cause of suit arose. The receivers by accepting the deed were compelled by its terms to postpone their legal remedies against Barnette until November 18, 1914. The appellee has pleaded no facts, nor has she testified to facts, to excuse her delay or repel the presumption arising from the lapse of time. In Woodmanse & Hewitt Mfg. Co. v. Williams, 68 Fed. 489, 15 C. C. A. 520, Judge Burton said:

“One who invokes the protection of equity must he ‘prompt, eager, and ready’ in the enforcement of his rights. Equity will not encourage a suitor who has long slept over Ms rights.”

So in Kittle v. Hall (C. C.) 29 Fed. 511, Judge Coxe said:

“Time passes, memory fails, witnesses die, proof is destroyed, and the rights of individuals and of the public intervene. Long acquiescence and laches can only be excused by proof showing excusable ignorance, or positive inability to proceed on the part of the complainant, or that he is the victim of fraud or concealment on the part of others.”

Reversed and remanded, with instruction to dismiss the bill.