A, First Regiment, Nat'l Guard Training Sch. Co. v. State, 5590.

• Decision Date: 17 April 1929
• Docket Number: No. 5590.,5590.
• Citation: 58 N.D. 66,224 N.W. 661
• Parties: COMPANY A, FIRST REGIMENT, NATIONAL GUARD TRAINING SCHOOL v. STATE et al.
• Court: North Dakota Supreme Court

58 N.D. 66

224 N.W. 661

COMPANY A, FIRST REGIMENT, NATIONAL GUARD TRAINING SCHOOL

v.STATE et al.

No. 5590.

Supreme Court of North Dakota.

Feb. 21, 1929.

Rehearing Denied April 17, 1929.

Syllabus by the Court.

A deed, transferring the property of a corporation, executed by unauthorized officers of the corporation, is void.

Section 8175, Compiled Laws of 1913, authorizes actions against the state to quiet title, but in such actions, under subdivision 3 of section 7426, service of process must be made upon the Governor or the Attorney General, and where a default judgment is rendered in an action against the state, where process was not served as required, the judgment is of no force or effect.

In an action to determine adverse claims, the plaintiff cannot succeed on the weakness of the title of an adversary.

Admissions in an answer of one of several defendants cannot confer rights upon the plaintiff as against other parties in interest.

Chapter 174, Laws of 1907, authorizes aid by legislative appropriation to militia companies upon certain conditions, and the aid therein provided is not made available to corporations formed under section 1788, Revised Codes of 1905.

Where a corporation formed under section 1788, Revised Codes of 1905, acting in behalf of a militia company, executes a mortgage to the state and obtains the appropriation of $5,000 under section 5, c. 174, Laws of 1907, it must be deemed to have pledged the property of the militia company, and it thereby assents to the terms of the statute which places the property under the control and supervision of the militia company subject to the authority of the state board of armory supervisors.

Where a corporation formed under section 1788, Revised Codes of 1905, causes title to armory property to be conveyed to the state for the purposes of chapter 174, Laws of 1907, the title to such property cannot be reconveyed to such corporation by deed signed by the Governor, and, where subsequent steps are taken to obtain the benefit of the legislative appropriation made in said chapter, the legal title to such property remains in the state for the use and benefit of the militia company.

In an action to determine adverse claims, where on the record the plaintiff is shown to have no interest in the property that is the subject-matterof the litigation, the action will be dismissed as to such plaintiff.

Where such an action is dismissed, but there remains for determination matters affecting the interests of parties who are joined as codefendants, the action will not be dismissed, but jurisdiction will be retained for the purpose of adjudicating such interests.

For reasons stated in the opinion, it is held that the militia company is not estopped to assert its right in armory property which is purported to have been conveyed to private parties by private parties who claim to have acquired title under a deed executed by the Governor to a private corporation.

For reasons stated in the opinion, it is held that the purchasers of the property in question, whose title failed, have an equitable lien for the money expended in discharging obligations and making improvements, and that they are obligated to account for rents and profits received.

Appeal from District Court, Burleigh County; John C. Lowe, Judge.

Action by Company A, First Regiment, National Guard Training School, against the State, C. B. Little, Mary H. Hughes, Edmond A. Hughes, and others, wherein the last three named defendants filed a counterclaim. From a judgment in favor of the second and third named defendants, plaintiff appeals. Reversed, with directions.

F. O. Hellstrom, of Bismarck, and Knauf & Knauf, of Jamestown, for appellant.

Zuger & Tillotson, of Bismarck, for respondents.

ENGLERT, District Judge.

This is an action to quiet title to lots 23 and 24 of the original town site of Bismarck, Burleigh county, N. D. The case was before this court on a former appeal. Company A v. Hughes et al., 55 N. D. 897, 215 N. W. 476, 54 A. L. R. 949. It was sent back for a new trial, for reasons therein mentioned, without a consideration of the merits involved. Since the facts are quite fully stated therein, we will give only such facts here as will enable an understanding of the merits of the case.

The plaintiff is a corporation. It was organized and incorporated on April 30, 1906, under section 1788 of 1905 Revised Codes. The object of the corporation was to lease or buy suitable grounds on which to erect an armory, own and maintain a rifle range, to be used by the company as a training school, and place of meeting to promote and instruct its members in the arts and science of war. It is designated in the articles of incorporation as “Company A, First Regiment North Dakota National Guard Training School.” A board, consisting of five members, managed and controlled the affairs of the corporation. It provided that the captain of the company should be ex officio one of the five members, and president of the board of directors.

In 1908, Company A negotiated for the purchase of said lots. The money with which the property was purchased was raised through public entertainments, dances, contributions, loans, and the city council donating from the public funds of the city of Bismarck. The lots were purchased by the company, and the title was taken in and deeded to the state of North Dakota. The deed to the state of North Dakota was dated March 18, 1908, and recorded in Burleigh county on March 23, 1908.

On May 27, 1908, the then governor of the state of North Dakota conveyed the lots to Company A, First Regiment, North Dakota National Guard Training School, a corporation, as distinguished from the militia company (Company A), by warranty deed, which deed was recorded in Burleigh county on June 5, 1908.

On April 30, 1914, Company A, the training school corporation, gave a mortgage on said lots to the Red River Valley Mortgage Company to secure the sum of $3,500 due May 1, 1919. It also gave a mortgage on this property to that company on the same day to secure the sum of $262.50.

On May 6, 1914, the company gave a mortgage to the state of North Dakota on said lots to secure the sum of $5,000. Each of said lots is 25 feet wide and 140 feet long. In 1908 an armory was erected thereon 50 feet wide and 90 feet long. It was a brick structure and cost $11,000. It is spoken of as a two-story building, made up of full basement, with wooden floor and one story above the basement 20 feet high.

The armory was used by the militia company for training its members and for entertainments until March, 1917, when the company was called into federal service. From March to October 1, 1917, Company I occupied the armory, when this company was also called by the federal government into military service. Up to March, 1917, when Company A was called, one A. B. Welch was captain of that company. In due time he organized Company I and became its captain. Captain John W. Murphy was assigned to and made captain of Company A. Both companies were transported overseas as a part of the United States Army.

On leaving, Capt. John W. Murphy appointed the defendant Edmond A. Hughes, on September 29, 1917, custodian of the armory to take effect October 1, 1917 He accepted that trust and managed the property until Capt. John W. Murphy returned some time in 1918, the exact time not appearing. Capt. John W. Murphy returned some time in advance of Company A. The members of Company A returned later, not together, but in various numbers and at different times. Meanwhile Capt. John W. Murphy died.

On October 9, 1919, H. T. Murphy and L. W. Sperry deeded said property to Edmond A. Hughes and C. B. Little. They signed as president and secretary of Company A, the training school corporation, respectively. The consideration mentioned in the deed is $1 and other valuable consideration. By this time all of the members of Company A had returned from foreign service. The company was never mustered out, but it was not, however, reorganized until May 22, 1922.

On January 23, 1920, Edmond A. Hughes and C. B. Little began an action against the state of North Dakota to quiet title to said lots. Judgment was entered by default on April 22, 1920. They took possession of the said property on April 23, 1920, or thereabouts, and began making extensive improvements. On April 23, 1920, Edmond A. Hughes conveyed his interest in said property to Mary H. Hughes.

On August 4, 1921, the plaintiff brought this action to quiet title. The complaint is in the statutory form. It alleges fee ownership of the premises in the plaintiff, and prays that the defendants be decreed to have no estate or interest in the said property, and that the title thereto be quieted in plaintiff.

The state answered, admitting plaintiff to be the owner in fee of the lots described, and asserted its $5,000 mortgage and prayed that the lien thereof be preserved. The defendants Edmond A. Hughes, C. B. Little, and Mary H. Hughes answered and counterclaimed, basing their title on various grounds therein set forth, which may be epitomized as follows:

(1) That Company A deeded the property to Edmond A. Hughes and C. B. Little, on October 9, 1919, for a valuable consideration.

(2) That a judgment was entered in favor of these defendants and against the state of North Dakota, on April 22, 1920, quieting title in them.

(3) That the purchase price paid by these defendants to the plaintiff has not been repaid, and that it has not offered to repay the same.

(4) That the plaintiff stood by and permitted extensive improvements to be made upon the premises, and thereby acquiesced in and ratified the said sale of October 9, 1919, and that the plaintiff is now estopped from claiming any interest in the said property.

The plaintiff replied, denying the matters set forth in that answer and counterclaim. The other defendants make no claim to the property, and will not, therefore, be further mentioned.

Evidence was...