Evers v. Watson

• Decision Date: 04 March 1895
• Docket Number: No. 180,180
• Citation: 156 U.S. 527,15 S.Ct. 430,39 L.Ed. 520
• Parties: EVERS et al. v. WATSON et al
• Court: U.S. Supreme Court

156 U.S. 527

15 S.Ct. 430

39 L.Ed. 520

EVERS et al.

v WATSON et al.

No. 180.

March 4, 1895.

This was a bill in equity to set aside a decree rendered in a former case of Watson v. Evers et al. for want of jurisdiction, or that the sale of certain land by a special commissioner, under such decree, be set aside as to all the lands still in the possession of the defendants.

Plaintiffs, who were aliens,—British subjects, and residents of London,—set forth: That in 1881 or 1882 they, together with Watson and one Baldwin, citizens of Illinois, were associated together in the purchase of a large quantity of land in Mississippi, known as the 'Delta,' amounting to 500,000 or 600,000 acres, together with certain pine lands, amounting to about 150,000 acres. That, certain differences having arisen as to their respective interests, Watson filed a bill in the chancery court of Le Flore county (a mistake for De Soto county) against Evers, William Marshall, George F. Philips, M. S. Baldwin, et al., which was removed into the circuit court of the United States, wherein a decree was rendered on October 3, 1885, in favor of Watson for the sum of $145,000, which was charged as a lien upon said lands, and, in the event of the failure of the defendants to pay such sum within six months from the date of the decree, the lands were to be sold by one McKee, as special commissioner, for the satisfaction of the decree. The land was accordingly sold, and most of it bought in by Watson, such sale being afterwards confirmed by the court. 'That said decree was a consent decree, agreed to in a spirit of compromise, and accompanied with and based upon certain agreements, to be hereinafter explained.'

The bill further alleged that the circuit court of the United States was without jurisdiction to entertain such suit or render such decree by reason of the fact that Watson, the plaintiff in such bill, was a citizen of Illinois, and Baldwin, one of the defendants, and a material defendant, was likewise a citizen of Illinois.

It is further charged: That, before the sale of the land was had, Watson and his agents and representatives conspired with one Burroughs to prevent them (the plaintiffs) from being present at said sale, and to deter them from bidding for the lands, the result of which fraudulent collusion was that Watson bought the lands at a mere trifle per acre, except about 162,000 acres, which it was fraudulently agreed that Burroughs and his friends should buy at their own figures. That but for such fraudulent collusion the Delta lands would have sold for more than enough to satisfy the decree, and would have left at least the pine lands to plaintiffs in this bill and the other defendants in said suit, after fully paying their debt. Instead of this, they succeeded in securing all the land, and still claim a large balance against the defendants in that suit as due by the decree; more, in fact, than Watson originally advanced for the purchase of the land. The plaintiffs were not aware of, and had no knowledge of, the fraud practiced upon them by Watson until recently, and long after the sale had been ratified and confirmed; and that this is the first opportunity to bring the matter before the court, and ask a restitution of their rights, and an equitable redress for the fraud.

That the decree was a compromise decree, accompanied by stipulations, one of which was that the defendants were to have six months in which to pay the decree; and that, when they acquiesced and consented to such decree, it was their intention and expectation, and it was so understood by all parties, to organize a land company in London, and to sell the lands referred to in the decree for money enough to pay off said indebtedness, and the balance in stock and debentures and working capital within the six months allowed to them by the decree. To accomplish this, and in carrying out the understanding, a company was organized, at great expense to plaintiffs, and a satisfactory sale of the lands arranged to be made to such company, which would have been perfected, and Watson's debt paid, but for the interference of Watson and his agents, who, by circulating false reports affecting the title to the land, prevented such company from being floated, and defeated the efforts of the defendants in such suit in raising money to comply with their agreement to pay off such decree. That afterwards, a son of Watson, representing his father and the Delta & Pine Land Company, visited London, and, recognizing the fact that plaintiffs still had an interest in the lands, agreed to organize another English company, certain shares of stock in which company they agreed to receive. That plaintiffs, being ignorant of the fraud that had been practiced upon them at the time of the sale, and relying upon the statements of Watson's son, at his request executed quitclaim deeds of their interests in such lands, Watson stating that he wanted such deeds in trust solely for the purpose of facilitating the sale of the lands to such company, and promising that such deeds, when executed, should be deposited by him with Walter Webb & Co., of Queen Victoria street, London, the solicitors of such company. That Watson, instead of depositing the deeds with the solicitors, fraudulently, and in violation of his promise and agreement, sent the deeds to Mississippi, and caused them to be registered in the several counties in which the lands were located. That this was done without the knowledge or consent of plaintiffs. That the organization of the company was never perfected, and negotiations for the sale of the lands had been abandoned. No stock was ever issued; plaintiffs never received any consideration for the deeds, or their interest in the lands. Such deeds were obtained by fraud and false pretenses and promises made by Watson, were without consideration, and are void. That plaintiffs are informed that Watson and the persons associated with him in the Delta & Pine Land Company have sold a large quantity of the lands at a good price, as well as a large amount of timber from the lands remaining in their possession, and have realized from such sales more than enough to pay the decree and the interest thereon.

The prayer of the bill was that the court set aside the decree rendered in the case of Watson v. Evers for lack of jurisdiction, or, if mistaken as to this, that the sale by the commissioner be set aside as to all the lands still in possession of defendants; that the quitclaim deeds be held to be inoperative and void, and defendants be required to render an account of the lands and timber sold by them, and the amount of taxes paid on the land since such sale; that the sums received, after paying the taxes, be credited upon the decree, and, in case Watson proves to have been overpaid, that a decree be awarded in favor of plaintiffs for the excess, and that the land now in possession of defendants be decreed to be the property of the plaintiffs, as their interest may appear.

A demurrer was filed to this bill by Watson and the Delta & Pine Land Company, which was sustained by the court, and the bill dismissed.

From this decree, plaintiffs appealed to this court.

Jas. L. McCaskill, for appellants.

Frank Johnston and J. Hubley Ashton, for appellees.

Mr. Justice BROWN, after stating the facts in the foregoing language, delivered the opinion of the court.

To maintain this bill, plaintiffs take the position either that the circuit court for the Northern district of Mississippi, to which the case was removed, was wholly wanting in jurisdiction to render the decree complained of in the case of Watson v. Evers et al., or that the sale made in pursuance of such decree was not only voidable for fraud, but absolutely void, and subject to collateral attack in this proceeding.

1. The allegations of the bill with regard to the want of jurisdiction of the federal court are very meager, and are simply that Watson filed a bill in the state court against Evers, Marshall, Philips, and Baldwin, which suit was removed to the federal court, and a decree rendered therein; that such court was wholly without jurisdiction, since Watson, as shown in the bill, was a citizen of Illinois, and Baldwin, one of the defendants, was also a citizen of the same state. It is not shown when,...