UNITED STATES SUPREME COURT DECISIONS ON-LINE

Where the holder of a preemption right to lots in the Town of Dubuque sold them to another person, the facts that the vendor had received certificates of his right, although the land officers were not satisfied with their sufficiency, and that the vendor acted as the undisputed owner, were sufficient to negative the charge of fraud in his representing his title to be good.

The relinquishment by the vendor of his title to the United States with a view to a public sale and completion of his title was not fraudulent towards the vendee if it was the purpose of the vendor to enable himself to convey a perfect title to his vendee.

If, at the public sale, the vendee himself became the purchaser, he became a trustee for his original vendor, and if, at the public sale, the original vendor became the purchaser, the title inured to the benefit of his vendee. clubjuris

Page 47 U. S. 285

The following statement of the case was the brief of Mr. Howard who argued it.

"This was an appeal from the Supreme Court of Iowa Territory, sitting as a court of equity, under the following circumstances."

"On 2 July, 1836, Congress passed an Act, chap. 262, 5 Stat. 70, for laying off the Town of Dubuque, amongst other towns, under the direction of the Surveyor General. The 1st section directed lots to be laid out in a certain manner, and a plat returned to the Secretary of the Treasury, and within six months thereafter the lots should be sold to the highest bidder. The 2d section directed the lots to be classed according to their value into three classes, viz. at $40, $20, and $10 per acre, respectively, and gave a right of preemption to those persons who had obtained a permit to settle or who had actually occupied and improved the lots, paying for the lot according to its class."

"On 3 March, 1837, Congress passed another Act, chap. 36, 5 Stat. 178, amendatory of the former, substituting a board of commissioners for the surveyor. They were empowered to 'hear evidence, and determine all claims to lots'; to reduce the evidence to writing, which they were directed to file with the register and receiver, together with a certificate in favor of each person having the right of preemption. Upon payment for the lot being made to the receiver, the receiver was directed to give a receipt for the same, and the register to issue a certificate of purchase, to be transmitted to the commissioner of the General Land Office, as in other cases of the sale of public lands."

"The 3d section directed the register and receiver to expose the residue of the lots to public sale, after advertising, &c."

"On 8 February, 1839, Marshall and Whitesides sold to Bush a preemption right to two lots in the Town of Dubuque, viz., No. 7 and No. 194. The deed is not upon the record, but the consideration is stated in the bill, and admitted in the answer (Rec. 3, 6) to have been three thousand dollars, one-half of which, viz., $1,500, was paid in cash by Bush. To secure the payment of the other half, Bush executed a mortgage to Whitesides and also gave his promissory note to Marshall for $1,790, payable on or before 1 October, 1839. Of this $1,790, $1,500 was for the purchase of the lots and the remaining $290 was for rent in arrear, which was transferred to Bush."

"It appears from the evidence of B. R. Petrikin, the register in the land office in the Town of Dubuque, that"

"Bush came frequently to the land office to enter the lots No. 7 and No.

Page 47 U. S. 286

194 under the preemption law, but was not allowed to do so by the land officers because the proof filed by William B. Whitesides with the commissioners, under the law laying off the Town of Dubuque, did not satisfy the land officers as being sufficient to maintain a right under the law in favor of Whitesides' preemption."

"It appears also from the same evidence that the land officers"

"had received instructions from the General Land Office to expose all lots to public sale where the claimants should relinquish their right to preemption (under the law laying off the town) to the United States."

"In September, 1840, the lots in the Town of Dubuque were offered at public sale. Bush went to the land office and protested against the lots No. 7 and No. 194 being offered at public sale."

"Previous to the sale, however, it appears from the testimony of Dougherty that a 'committee of arrangements had been appointed for the purchase of lots in the Town of Dubuque'; that there was a 'public bidder,' who was a person selected by the claimants to lots in the Town of Dubuque, to purchase the lots they claimed, as they were offered at the public sale."

"It appears from the evidence of Dougherty that the committee of arrangements called on Bush and informed him that the committee desired him to make his relinquishment to lot No. 7, which he positively refused to do. The committee then erased the name of Bush and inserted the name of Whitesides, and informed Whitesides immediately of the same, when he, the said Whitesides, came before the committee and made his relinquishment to said lot."

"It appears also from the testimony of Petrikin, the register, that Whitesides came to the land office and produced the deeds in relation to the property before the officers of the land office, and the said officers considered that the said Whitesides had a right to relinquish his preemption right, and thereupon the said Whitesides did relinquish, in consequence of which the lots No. 7 and No. 194 were put up at public sale."

"The following statement of facts was agreed upon in the court below."

" It is agreed the following statement of facts may be used, in the same manner as if the same were proved by witnesses on the hearing of the above causes:"

" 1st. That the lots mentioned in the foregoing pleadings were sold at a public sale of lots in the Town of Dubuque, by the Unites states, in last, at which sale John D. Bush above named, became the purchaser of lot No. 7, and the above-named William B. Whitesides of lot No. 194. "

Page 47 U. S. 287

" 2d. That said lots would not have been put up and sold at said sale, unless the said William B. Whitesides had relinquished all claim to the same to the United States previous to said sale, and that said Whitesides did thus relinquish, previous to the same's being put up to sale, and for the express purpose of having them sold at said sale."

" 3d. That said Bush objected and protested to said Whitesides against the said Whitesides thus relinquishing."

" 4th. That previous to said sale and at the time of said relinquishment and subsequent thereto (but previous to the sale), said Bush was informed by E. C. Dougherty and Whitesides and by said Whitesides' agent that his object in having the said lots put up to sale was expressly with a view that the title to them might be perfected in said Whitesides so that he could make a good title to said Bush upon said Bush paying the purchase money for said lots. And also that said Whitesides, by himself or agent duly authorized for said purpose, did propose and offer to said Bush that if said Bush would bid for said lots and agree that his purchase should be under the contract for them set out in the pleading in the above causes, said Whitesides would make no opposition to his so doing, but was perfectly willing said Bush should become the purchaser with this understanding, but that said Bush utterly refused so to do, when said Bush was informed by said Whitesides or by his agent that said Whitesides would bid for said lots at said sale in order to enable him to comply with his contract with said Bush. That said Whitesides and Bush were the only bidders for said lots at said sale and that Philip S. Dade was the bidder for said Whitesides, of which the said Bush, previous to and at the time of said sale, was advised and informed. That the memorandum at the foot of the deed or mortgage that said Bush was to furnish the money to pay for said lots was there inserted by the express agreement and understanding of said Bush at the time of executing said deed and mortgage."

" The public sale took place in September, 1840, after Bush had refused to purchase under his contract. At the sale, the public bidder and Bush were the only bidders for the two lots No. 7 and No. 194, the public bidder bidding for Whitesides, of which Bush was informed previous to and at the time of said sale. The lot No. 7 was bid off to Bush and No. 194 to Whitesides."

" In April, 1841, Whitesides and Marshall filed a bill in the District Court of Dubuque County praying a foreclosure of the mortgage and sale of both lots. After an answer and a general replication, the court decreed for the complainants and ordered both lots to be sold. An appeal was taken to the Supreme

Page 47 U. S. 288

court of Iowa, where the decree of the court below was affirmed, and the cause was brought by appeal to this Court."