CASES

ARGUED AND DETERMINED

IN THE

UNITED STATES CIRCUIT COURTS OF APPEALS AND THE CIRCUIT AND DISTRICT COURTS.

HEINZE et al. v. BUTTE & BOSTON CONSOLIDATED MIN. CO. et al. (Circuit Court of Appeals, Ninth Circuit. November 2, 1903.)

No. 852.

1. PARTITION-POSSESSION TO SUPPORT SUIT-MONTANA STATUTE.

To support a suit for partition under Code Civ. Proc. Mont. § 1340, which authorizes such suit by co-tenants "who hold and are in possession of real property as joint tenants or tenants in common," actual physical possession is not essential, and need not be alleged, but such possession as the law imputes to the holder of the legal title is sufficient. 2. SAME TITLE OF COMPLAINANT-DENIAL BY DEFENDANTS.

The bare denial of complainant's title, on information and belief, by defendants in a suit for partition, who do not allege adverse title in themselves, does not put such title in issue, so as to require the court to stay the suit until it shall be established at law.

8. SAME-CROSS-BILL SETTING UP EQUITABLE Title-Procedure.

Where an intervener in a partition suit files a cross-bill setting up an equitable title to the interest claimed by complainant, and prays that certain deeds be canceled on the ground of the insanity of the grantor and of fraud, and that he be decreed to be the owner of such interest, there is no occasion for the court to stay the partition suit, but it may properly proceed and try all the issues raised at the same time, the effect necessarily being to defer any action as to partition until the issues raised by the cross-bill have been determined; and especially is such procedure appropriate where the cross-bill contains all the essentials of an original bill for affirmative relief, and in effect prays for partition. 4. SAME-POWER TO APPOINT RECEIVER.

In a suit for partition of mining property, in which the ownership of one of the interests is in dispute, the court has power to appoint a receiver for the share of the ore being mined by the co-tenants in possession. pertaining to such interest, where necessary to protect the rights of all the parties.

6. SAME

RECEIVERS-POWER TO DIRECT OPERATION OF MINES.

Pending a suit in a federal court to partition mining property, defendants, whose interests were undisputed, were in possession and operating the mine. The title to the interest claimed by complainant being in dispute, the court appointed a receiver to receive and hold the share of the ore mined pertaining to such interest. Subsequently, on application of

1. See Partition, vol. 38, Cent. Dig. §§ 60, 63.

126 F.-1

complainant, alleging that defendants were so operating the mine as to fraudulently prevent the receiver from obtaining his share of the ore, and after a full hearing, the court extended the receivership to the entire property, and directed the receiver to operate the mine and deliver to defendants their share of the ores extracted. On such hearing, defendants relied on an order made by a state court in a suit brought therein appointing a receiver for their interests, with directions to operate the mines; and there was evidence tending to show that such suit was collusive, and the appointment of the receiver obtained for the purpose of ousting the federal court of jurisdiction to extend its own receivership over defendants' interests. Held, that in view of such evidence, and the fact that other evidence produced on the hearing was not in the record, an appellate court could not say that the trial court exceeded its power or abused its discretion in so extending its receivership, or in directing its receiver to operate the mines, especially as the proceedings in the state court and other evidence tended to show that defendants recognized the propriety of such action, and they also accepted their share of the ore mined by the receiver.

6. APPEAL-REVIEW OF FINDINGS OF FACT.

Findings of fact made by the trial court will not be disturbed unless the appellate court can clearly see that they are opposed to the weight of the evidence, or unless some error is clearly shown.

7. PARTITION-ISSUES INVOLVING QUESTIONS OF TITLE-DUTY TO STAY SUIT. A partition suit is not an appropriate proceeding in which to try controverted questions of title between the parties, except in state courts, which are authorized by statute to try legal and equitable issues in the same action; and where, in such a suit in a federal court, an issue is raised by the pleadings as to complainant's title, involving a question of fact-as the sanity or insanity of a grantor-it is the duty of the court, on motion, to stay the suit until such issue has been determined in an action at law, where either party may exercise his constitutional right to demand a jury trial. Per Ross, Circuit Judge, dissenting.

8. MINES-RECEIVERS-AUTHORITY TO DIRECT OPERATION OF MINE.

It is only in rare cases, and upon the strongest showing of necessity, that a court is authorized to appoint a receiver for mining property, with authority to operate the same and extract the ore therefrom. Per Ross, Circuit Judge, dissenting.

Appeal from the Circuit Court of the United States for the District of Montana.

James M. Denny, John J. McHatton, and John W. Cotter, for appellants.

H. J. Burleigh, for the receiver.

John F. Forbis and L. O. Evans, for appellees.

Before GILBERT, ROSS, and MORROW, Circuit Judges.

GILBERT, Circuit Judge. The questions presented for consideration on this appeal are: First, whether the amended bill for partition was defective, for the reason that it contained no allegation that the appellee the Butte & Boston Consolidated Mining Company was in possession of the premises sought to be partitioned; second, whether the decree should be reversed for the reason that the trial court proceeded to a trial of the issues presented on the cross-bill of the appellants after it was disclosed that the title of the complainant in the amended bill was in dispute; third, whether the court erred in appointing a receiver over the disputed interests, and subsequently in extending such receivership over the whole of the property sought

to be partitioned, and in directing the receiver to operate and mine. the same; fourth, whether the court erred in its findings of fact upon the issues presented by the cross-bill.

The Montana statute gives the remedy of partition to co-tenants "who hold and are in possession of real property as joint tenants or tenants in common," etc. Code Civ. Proc. § 1340. We think that the possession which the law imputes to the holder of the legal title is sufficient to maintain partition, under this statute. The statute is said to have been taken from section 1535 of the Code of Civil Procedure of New York. In construing that section in Bender et al. v. Terwilliger et al. (Sup.) 63 N. Y. Supp. 270, subsequently affirmed by the Court of Appeals in 166 N. Y. 590, 59 N. E. 1118, the court said, "The possession therein referred to does not mean an actual physical possession, but that possession which follows the title." In Wainman v. Hampton, 110 N. Y. 429, 433, 18 N. E. 234, 235, the court said, "A constructive possession such as the law draws to the title is sufficient for the maintenance of the action." In Weston v. Stoddard, 137 N. Y. 119, 128, 33 N. E. 62, 65, 20 L. R. A. 624, 33 Am. St. Rep. 697, the court said, "What is here meant is not a strict pedis possessio, but a present right to the possession."

The complainant alleged in its amended bill that it owned in fee simple an undivided one-half of the Snohomish claim; and an undivided two-thirds of the Tramway claim. It alleged that the defendants in the bill owned the remaining interests in both claims as its co-tenants. The answer to the amended bill which was filed by Daniel W. Connole, Catherine Sullivan, and Patrick N. Sullivan, and the answer which was filed by John McNamara, Bridget McNamara, and Joseph Connole, denied, on information and belief, "that the complainant is now or ever was the owner in fee simple or otherwise of an undivided one-half interest, or any interest, in the Snohomish lode claim, or of an undivided two-thirds interest, or any interest, in the Tramway lode claim." These answers were filed respectively on December 1, 1897, and December 30, 1897. On March 21, 1898, F. Augustus Heinze, having obtained leave to intervene, filed a cross-bill, alleging that on October 16, 1897, he had purchased from Daniel W. Connole, Catherine Sullivan, and Patrick N. Sullivan, her husband, John McNamara, Bridget McNamara, his wife, and Joseph Connole, their undivided one-half interest in the Snohomish claim, and their undivided one-third interest in the Tramway claim. The sole object and purpose of his cross-bill was to set forth his interest in the property which was sought to be partitioned, and to obtain a decree protecting his right therein, and distributing to him his proportion of the proceeds of the same in case of a sale. The cross-bill also denied, upon information and belief, the title of the complainant in the bill. In none of the pleadings so far filed in the case was any defect or infirmity in the complainant's title alleged, nor was it asserted that any of the parties had adverse claims against the alleged title of the complainant, or adverse possession of the property sought to be partitioned. All the information that was conveyed by the pleadings at that date was that the complainant

alleged a title in fee simple, and that the defendants and the intervener all denied, on information and belief, that the complainant' was the owner of the interest which it asserted in its bill. In other words, by their answer they said to the court, "We own an undivided one-half of one claim, and an undivided one-third of the other, but we deny, on information and belief, that the complainant owns the other interests." While the pleadings were in that condition, on April 30, 1898, Heinze, the intervener, and the defendants who had answered, moved for an order directing a stay of proceedings until the complainant should establish its right in an action at law. This motion, in view of the state of the pleadings, was denied. It was not again renewed, nor was the court at any subsequent stage of the proceedings requested to stay the action of partition.

The motion was properly denied. No issue had been raised as to the complainant's title or possession. The equity doctrine is well expressed by Chancellor Williamson in Lucas v. King, 10 N. J. Eq. 277, where he said:

"I do not understand, however, that the bare denial of the complainant's title is any obstacle to the court's proceeding. The defendant must answer the bill; and if he sets up a title adverse to the complainant, or disputes the complainant's title, he must discover his own title, or show wherein the complainant's title is defective. If, when the titles are spread before the court, upon the pleadings, the court can see that there is no valid legal objection to the complainant's title, there is no reason why the court should not proceed to order the partition."

In Jenkins v. Van Schaack, 3 Paige, 242, the court said:

"If there had been an actual ouster of the complainant by his co-tenant, or if the land was held adversely, it might be necessary to regain the actual seisin by ejectment before a suit for partition of the premises could be sustained either at law or in equity."

In Appeal of Wistar, 115 Pa. 241, 8 Atl. 797, the court said:

"The defendants must point out some defect in the petition, or aver their own title or adverse possession, to justify the court to refuse to proceed in the partition."

Of similar import are Overton's Heirs v. Woodfolk, 6 Dana, 374; Appeal of Welch, 126 Pa. 297, 17 Atl. 623; Hooper v. De Vries, 115 Mich. 231, 73 N. W. 132. The reason of the rule applies with added force to a case such as this, where the answering defendants made no adverse claim as against the interest asserted by the complainant.

On July 20, 1898, some three months after the motions to stay the suit were interposed, James Larkin, by his guardian ad litem, intervened and filed his answer to the amended bill, and filed his cross-bill thereto. In the answer it was alleged that Larkin was insane, and had been insane for five years. The answer denied, on information and belief, that the complainant owned the interest which it claimed to own in the two mining claims, and alleged, on information and belief, that the said James Larkin was at the time of the commencement of the suit, and still was, the owner thereof. The answer contained no allegation, however, that the complainant claimed title through James Larkin, or as his grantee. The prayer