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against them, as citizens within the clause of the constitution declaring the extent of the judicial power of the United States. It has been expressly held that they are to be so considered when they have controversies with citizens of other states. And the same course of reasoning which led to this decision must also lead to the conclusion that in all cases where a federal court can take jurisdiction of controversies between citizens, whether of different states or of the same state, it will take jurisdiction of like controversies between corporations, and treat them as citizens of the state under whose laws they were created or continue to exist. The constitution declares that the judicial power of the United States shall extend to all cases in law and equity arising under it, the laws of the United States, and treaties made under their authority. The act of 1875 invests the circuit courts with original cognizance, concurrent with the courts of the several states, “of all suits of a civil nature at common law or in equity” thus arising, where the matter in dispute ex. ceeds, exclusive of costs, the sum or value of $500. 18 St. 470. The reasons for granting this jurisdiction, and for investing it in the circuit courts, are as applicable where the controversies are between citizens united under a corporate name, as where they are between citizens in their individual capacity. A private corporation is, in fact, but an association of individuals united for a lawful purpose, and permitted to use a common name in their business, and to have a change of members without dissolution. As said by Chief Justice MARSHALL in Providence Bank v. Billings: *" The grant of incorporation is to bestow the character and properties of individuality on a collective and changing body of men." 4 Pet. 514, 562.
The controversy in this case arises upon laws of the United States. As far back as Cohens v. Virginia, decided more than 60 years ago, it was said that a case may be considered to arise under the constitution or a law of the United States whenever its correct decision depends upon the construction of either. 6 Wheat. 379. The same thing is expressed by the statement that a case arises under the constitution or laws of the United States whenever the rights set up by a party may be defeated by one construction or sustained by the opposite construction. Osborn v. Bank of U. 8. 9 Wheat. 738. Here both corporations claim title to the same land in Kansas under different acts of congress, and the decision depends upon the construction given to those acts. It is, therefore, clear that the court below had jurisdiction of the subject of the suit and of the parties.
The plaintiff claims, under the act of July, 1862, to aid the construction of a railroad and telegraph line from the Missouri river to the Pacific ocean, and acts amending or supplementing it. That act granted to the company formed under its provisions, for every mile of the road, five sections of public land designated by odd numbers on each side of the line of the road within the limit of 10 miles, which were not sold, reserved, or otherwise disposed of by the United States, and to which a pre-emption or homestead claim had not attached at the time the line was definitely fixed. It also provided that whenever the company had completed 40 consecutive miles of any portion of the road and telegraph line, and supplied all necessary equipments and appurtenances of a first-class road, the president of the United States should appoint three commissioners to examine the same, and if they reported that the road and telegraph line had been constructed and equipped in all respects as required, patents were to issue for the adjacent lands. An examination was to to be had, as each successive section of 40 miles was completed, and, upon a favorable report of the commissioners, other similar patents were to*issue. * Within one year after its passage the company was required to file in the department of the interior its assent to the act, and within two years afterwards to designate the general route of its road as near as might be, and to file a map of the same in that department. The secretary of the interior was then Lo withdraw the lands within 15 miles of the designated route from pre-emp
tion, private entry, and sale, and when any portion of the road was finally located he was to cause the lands granted to be surveyed, and set off as fast as necessary for the purposes mentioned.
On the second of July, 1864, an amendatory act was passed doubling the grant, and extending the limits within which the lands were to be withdrawn to 25 miles, but declaring that neither act should defeat or impair any preemption, homestead, swamp-land, or other lawful claim, nor include any gov. ernment reservation or mineral lands. It contained no express words of new and additional grant, but provided that the numbers in the act of 1862 should be stricken out and larger numbers inserted in lieu thereof. Thenceforth the act of 1862 is to be read as against the United States, and all parties not having acquired in the mean time paramount rights, as though the substituted numbers were originally inserted therein. Missouri, K. & T.R. Co. v. Kansas Pac. R. Co.97 U. S. 497; U.S. v. Burlington, 98 U. S. 334. The title to the increased quantity of land must, with the exceptions mentioned, there fore be deemed to have passed to the grantee at the date of the original act. That act contemplated the connection of several branch roads with the main line, one of which the plaintiff was to construct. Il directed the president to designate the initial point of that line in Nebraska, on the 100th meridian west from Greenwich, at which the eastern branches were to unite, and authorized the plaintiff to construct a railroad and telegraph line from the Missonri river at the mouth of the Kansas river, at the south side thereof, so as to connect with the Pacific road of Missouri at that point. In case the gen. eral route of the main line was located so as to require a departure northerly from the proposed Kansas road before it reached that meridian, the location of that road was to conform to it. The route in Kansas west of the meridian of Fort Riley to the initial point mentioned was to be subject to the approval of the president after actual survey. The amendatory act of 1864 enlarged the grants made to all the branches of the main road. As was said by this court in U. 8. v. Burlington: “All the reasons which led to the enlargement of the original grant led to its enlargement to the branches. It was the intention of congress, both in the original and in the amendatory act, to place the Union Pacific Company, and all its branch companies, on the same footing as to lands, privileges, and duties, to the extent of their respective roads, except when it was otherwise specially stated. Such has been the uniform construction given to the acts by all departments of the government. Patents have been issued, bonds given, mortgages executed, and legislation had upon this construction. This uniform action is as potential, and as conclusive of the soundness of the construction, as if it had been declared by judi. cial decision. It cannot at this day be called in question.” 98 U. S. 341.
On the third of July, 1866, congress passed an act enabling the plaintiff to designate the general route of its road, and to file a map thereof at any time before the first of December, 1866, and providing that after the filing of the map the lands along its entire line, so far as it was designated, should be reserved from sale by the secretary of the interior. It also provided that the company should connect its line of road and telegraph with the Union Pacific road at a point not more than 50 miles westerly from the meridian of Denver, in Colorado.
It is conceded that the plaintiff in due time filed in the department of the interior its acceptance of the acts of 1862 and 1864, commenced the construction of its road under them, completed it within the required time, and complied with the terms and conditions essential to entitle it to the lands granted; that on the tenth of January, 1866, it filed with the secretary of the interior a map of the definite location of its road, showing the dates of the actual location of its various parts in*compliance with bis instructions; that the road was located along and contiguous to the lands in controversy before February 4. 1865; that upon that location the road was afterwards duly constructed; that
on February 6, 1866, the location was approved by the commissioner of the general land-office; that by instructions soon afterwards given the odd-numbered sections of land within 20 miles of the road were withdrawn from sale and reserved for its use; that the railroad along and adjacent to the lands in controversy was completed and accepted by the president before December 14, 1866, and by his order the secretary of the interior was directed to issue patents to the plaintiff for the adjacent lands under the grant; that the lands in controversy in this case are odd sections within 20 miles of the line of the railroad as thus constructed and accepted, and were public lands, July 1, 1862, and have not since been entered under any pre-emption or homestead law, or otherwise reserved or disposed of by the United States, unless they are embraced in a grant to the state of Kansas by virtue of an act of congress of March 3, 1863, under which the defendant claims. If not thus embraced the title of the plaintiff to them is clear.
By that act congress granted lands to the state of Kansas for the purpose of aiding in the construction of various railroads, one of which was to extend from the city of Atchison via Topeka, the capital of that state, to its western line in the direction of Fort Union and Santa Fe, New Mexico, with a branch down the Neosho valley to a point where the Leavenworth and Lawrence road entered it. The lands were the alternate sections, designated by odd numbers, for 10 sections in width on each side of the proposed road. The grant was accompanied with a proviso that in case it should appear when the lines or routes of the road should be definitely fixed that the United States had sold any section granted, or any part thereof, or that the right of pre-emption or homestead settlement had attached to it, or that it had been reserved by the United States for any purpose whatever, then it should be the duty of the secretary of the interior to select from the public lands, nearest to tie tiers of sections specified, an equal amount of land in alternate* sections or parts of sections, designated by odd numbers, not previously sold, reserved, or otherwise appropriated, to be held by the state of Kansas for the like uses and purposes. The legislature of the state, by an act passed Fehrnary 9, 1864, accepted the grant from the United States, and, in consideration that the Atchison, Topeka & Santa Fe Railroad Company would construct the road mentioned, directed the governor of the state, whenever any 20 consecutive miles were completed, to convey to that company by patent the lands granted by congress to aid in its construction, to be selected opposite to and within the limit of 10 miles of the road. On the sixteenth of the same month the company accepted the provisions of this act, and filed its acceptance with the secretary of state. On the nineteenth of March following, before any route of the road had been designated by the company, or any map of it filed, the commissioner of the general land-ollice made an order withdrawing from private sale or location, and from pre-emption or homestead entry, all the public lands lying within 10 miles of lines marked by him on a diagram as “the probable lines” of the road and its branches. This order was made at the request of senators and representatives in congress from Kansas, and was approved by the secretary of the interior. On the first of January, 1866, the company filed in the department of the interior a map or profile of its road from Topeka to Emporia, adjacent to which and within 20 miles thereof are the lands in controversy. It is conceled that afterwards the road was constructed in full compliance with the act of congress and the act of the state of Kansas, and that it was duly approved and accepted by the proper authorities. When its line was definitely fixed it appeared that of the lands lying within the limits of 10 miles thereof, many sections and parts of sections had been sold by the United States, and to many the right of pre-emption and homestead settlement had attached, and that some had been reserved by the United States for other purposes, thus greatly diminishing the quantity which would otherwise be covered by the grant. To make up the deficiency the
secretary of the interior selected the lands in controversy, taking them from alternate sections designated by odd numbers, nearest the tiers of sections within the 10-mile limit, but outside of that limit and within 20 miles of the road. These indemnity lands were certified to the state by the land department against the objections of the plaintiff, and the proper officers of the state in May, 1873, executed a patent of them to the company.
The question, therefore, for determination is whether the grant to Kansas, by the act of congress of March 3, 1863, covered the title to these indemnity lands. We are clear that it did not. It granted only alternate sections, designated by odd numbers, within the limit of 10 miles, and from them certain portions were to be excepted. For what was thus excepted other lands were to be selected from adjacent lands, if any then remained, to which no other valid claims had originated. But what unappropriated lands would thus be found and selected could not be known before actual selection. A right to select them within certain limits, in case of deficiency within the 10-mile limit, was alone conferred, not a right to any specific land or lands capable of identification by any principles of law or rules of measurement. Neither locality nor quantity is given from which such lands could be ascertained. If, therefore, when such selection was to be made, the lands from which the deficiency was to be supplied had been appropriated by congress to other purposes, the right of selection became a barren right, for until selection was made the title remained in the government, subject to its disposal at its pleasure. The grant to the Kansas Pacific Company by the act of 1862 carried the odd sections within the limit of 10 miles from its road, and by the act of 1864 such sections within the limit of 20 miles. The act of 1862 is to be construed, as already said, as though the larger number were originally inserted in it, and, with the exceptions stated, it must be held to pass the title to the grantee as against the United States, and against all persons not having acquired that title previous to the amendment. The grant to Kansas, as stated, conferred only a right to select lands beyond 10 miles from the defendant's road, upon certain contingencies. It gave no title to indemnity lands in advance of their selection." By the very terms of the grant to Kansas, as we have seen, there was excepted from it any sec. tions or parts thereof which the United States had sold or reserved for any purpose, or to which a pre-emption or homestead settlement had attached be. fore the line of the road or its branches had been definitely fixed. And the secretary was required to select, for like purposes, outside of the limits of the grant, as much lands, says the act, “as shall be equal to such lands as the United States have sold, reserved, or otherwise appropriated, or to which the rights of pre-emption or homestead settlements have attached as aforesaid.” The reservation “for any purpose” is thus made to cover not merely a specific reservation in terms for the uses of the United States, but any appropriation of the lands by the government.
The line of the road of the Atchison, Topeka & Santa Fe Company was not definitely fixed until 1866. Until then the appropriation of lands, even within the limits of the grant, much less so of lands without them, was in no respect an impairment of its rights. The appropriation outside of those limits only lessened the number of sections from which the secretary might under certain contingencies have the right to select indemnity lands; it had no other effect. The order of withdrawal of lands along the “probable lines” of the defendant's road made on the nineteenth of March, 1863, by the commissioner of the general land-office, affected no rights which, without it, would have been acquired to the lands, nor in any respect controlled the subsequent grant. And besides, it only purported to apply to lands within the 10-mile limit, and the lands in controversy lie outside of it, although the court below, overlooking the stipulation of the parties, stated the fact to be otherwise; an error which probably misled it to its conclusion.
It follows from the views expressed that the plaintiff, the Kansas Pacific Railway Company, under the acts of congress of 1862 and 1864, by a compliance with all their provisions in the construction of its road, acquired these title to the lands in controversy, and has accordingly a right to record evidence of it in the form of a patent. The decree of the court below must therefore be reversed and the case remanded, with directions to enter a decree adjudging that the title to the lands in controversy passed to the plaintiff under the acts of congress of 1862 and 1864; and that the defendant execute to the plaintiff a conveyance of its claim and interest therein; and it is so ordered.
(112 U. S. 405)
(November 24, 1884.)
The setting of a case down for hearing on bill and answer is, in effect, a submission of the cause to the court by the complainant on the contention that he is en. titled to the decree prayed for in his bill, upon the admission, and notwithstanding the denials of the answer. After a cause has been so set down, a motion to dismiss the suit for want of the timely filing of the replication is made too late, and ought
to be overruled by the court. 2. SAME-UNITED STATES COURT-JURISDICTION TO QUIET TITLE.
A circuit court of the United States has jurisdiction to quiet the title of a purchaser of land, as against a deed averred by the bill and not denied by the answer
to be void on its face. 3. SAME-BILL IN EQUITY TO QUIET TITLE-QUITCLAIM DEED-EQUITABLE TITLE.
Where R. holds an estate subject to mortgage and other liens for its full value, in the hands of B., and is adjudicated a bankrupt, if no debts have been proved against his estate, and he is discharged, and his assignee in bankruptcy has fully settled his estate, a quitclaim deed, executed by R. to B., vests in the latter a clear equi. table title to the mortgaged premises, and B. may maintain a bill in equity against
R. to quiet the title to the same. 4. SAME-NATIONAL BANKS-POWER TO PURCHASE REAL Estate.
A national bank has the power to purchase such real estate as shall be mortgaged to it in good faith by way of security for debts previously contracted; and if, in order to secure the same debt, it purchases other real estate not mortgaged to it,
that does not affect the title to the land it was authorized to purchase. 6. Same-CREDITORS-LIENS-PAYMENT.
Where B. makes an agreement with R. to pay R.'s debts, which are liens upon the estate of the latter, and makes an arrangement whereby R.'s creditors are satisfied, and takes an assignment of the liens to himself, such settlement of them is in substance and etfect a payment, and R. cannot complain. Appeal from the Circuit Court of the United States for the District of Indiana.
This was a bill in equity to quiet title and restrain waste, filed by the appellee, First National Bank of Crawfordsville, Indiana, against the appellant, Harris Reynolds. The bill alleged in substance that on August 18, 1875, Reynolds was indebted to the bank in the sum of $7,000, which was evidenced by his note of that date and amount, with Isaac M. Vance and James H. Watson as sureties; and that on the day just mentioned, in order to indemnify the sureties, Reynolds executed a mortgage on certain real estate; that on September 17, 1877, Reynolds executed to the bank another mortgage on the same lands to secure an additional sum of $3,000 which he at that date owed the bank; that on August 30, 1878, Reynolds was adjudged a bankrupt, and John W. Baird was appointed assignee of his estate; that on April 18, 1879, the assignee reported to the bankruptcy court that no assets of the bankrupt had come to his hands and no debts been proven against his estate, whereupon the estate was settled, and both the assignee and the bankrupt discharged; that before the discharge of the assignee, to-wit, on April 11, 1879, Reynolds stated to the bank that no claims had been proven against his estate, and that