Annoni v. Nadal's Heirs, 3795.

• Decision Date: 14 May 1943
• Docket Number: No. 3795.,3795.
• Citation: 135 F.2d 499
• Parties: ANNONI et al. v. NADAL'S HEIRS et al.
• Court: U.S. Court of Appeals — First Circuit

135 F.2d 499 (1943)

ANNONI et al. v. NADAL'S HEIRS et al.

No. 3795.

Circuit Court of Appeals, First Circuit.

May 14, 1943.

Jose Sabater, of Mayaguez, P. R., and Edward A. Welti, of Brooklyn, N. Y., for appellants.

Oscar Souffront, of Mayaguez, P. R., and Frank Martinez, of San Juan, P. R., for appellees.

Before MAGRUDER, MAHONEY and WOODBURY, Circuit Judges.

WOODBURY, Circuit Judge.

On February 25, 1931, the plaintiffs, as the testamentary heirs of Ernesto Patxot, brought a revendicatory action in the District Court of Mayaguez, Puerto Rico, against the heirs of Blas Nadal, the sole heir of Salvador Nadal, and Juan Bianchi¹ and Guillermo Cabrera, to obtain possession of an undivided half interest in a sugar plantation named Altagracia. The defendants severally demurred and their demurrers were sustained by a judge on commission appointed by the Governor of Puerto Rico, the regular judge of the insular district court having disqualified himself for relationship to one of the parties defendant. On appeal the Supreme Court of Puerto Rico (50 P.R.R. 498) held that the judge acting on commission became a judge de facto by the consent of the parties and affirmed his order sustaining the demurrers on the ground that the complaint did not state a cause of action and because the action was barred by the statute of limitations. On appeal to this court (94 F.2d 513) the judgment of the Supreme Court of Puerto Rico was reversed and the case was remanded for further proceedings on the ground that the judge acting on commission was not a de facto judge, there being no de jure office for him to fill; this court saying in its opinion that under the circumstances the case ought to have been transferred to another insular district in accordance with the provisions of § 84 of the Code of Civil Procedure of Puerto Rico. In view of its conclusion this court did not then consider the merits of the case.

On remand in accordance with the mandate of this court there was a hearing de novo before the then regular district judge of the District Court of Mayaguez, the one who had previously disqualified himself having in the meantime been superseded, and the demurrers were again sustained. On appeal the Supreme Court of Puerto Rico again affirmed, largely on the basis of its prior opinion from which it quoted at length, but which it elaborated to some extent, and the plaintiffs then took this appeal to us. They invoke our jurisdiction under § 128 of the Judicial Code, as amended, 28 U.S.C.A. § 225, the amount in controversy, exclusive of interest and costs, being in excess of $5,000.

On this appeal the case is before us on its merits. We must therefore briefly summarize the facts alleged in the complaint.

In 1890 Blas Nadal, both individually and as liquidator of Nadal and Company, entered into a written agreement with Ernesto Patxot, both individually and as liquidator of Patxot and Company, for the purpose of adjusting and liquidating controversies arising out of previous business transactions. According to the terms of this agreement Blas Nadal as liquidator sold an undivided half interest in Altagracia, title to which appeared in the registry of property in the name of Nadal and Company, to Ernesto Patxot at an agreed valuation and the two as individuals entered into a partnership for the exploitation of the farm for the period of ten years. The sale of the undivided half interest in the farm was made subject to the liens which then encumbered it and the newly formed partnership assumed liability therefor. This agreement was first executed in the form of a private document but in 1895 it was executed in the form of a public document. It was never recorded in the registry of property and no mention of it whatever there appears.

In 1897 Ernesto was declared by the former Court of First Instance of the City of Mayaguez to be of unsound mind and incapacitated and a tutrix was appointed to manage his affairs. During the following year the tutrix died and no one was ever appointed in her stead.

On January 3, 1898, Salvador Nadal, a cousin of Blas Nadal, instituted proceedings to foreclose a mortgage which he held on Altagracia. In these proceedings neither Ernesto nor his tutrix were served, but only Blas as liquidator of Nadal and Company. Foreclosure was decreed and the farm was adjudicated to Salvador on December 26, 1899.

It is alleged in the complaint that the mortgage foreclosed by Salvador was invalid; that Salvador knew of the agreement between his cousin Blas and Ernesto Patxot and knew that they were the joint owners of Altagracia, share and share alike, and that both Salvador and Blas also knew that Ernesto had been judicially declared incapacitated and that a tutrix had been appointed for him. The complaint then goes on to allege that Salvador and Blas in conspiracy...