Keith v. Alger. 1902, which were in fact paid by Governor Bliss, to be paid through defendant Alger's agent, one J. C. McCaul. Complainants charge that the money for said taxes was furnished by Governor Bliss to Alger's said agent McCaul, and by him transmitted to Tennessee, so that suspicion might not be aroused that defendant, Alger, had sold said land, and that Governor Bliss had become the owner thereof, as hereinbefore stated. Complainants further aver that one Frank Buchkosky, who was defendant Alger's agent in Tennessee in charge of said lands, at the time of the sale thereof to Governor Bliss in 1897, was after said sale employed in the same capacity by Governor Bliss, but that the fact that he had passed from the employment of said Alger to Governor Bliss was carefully concealed by defendant from the public and from the complainants, and, in order to make such concealment effective, said Buchkosky's salary, as in the case of the taxes aforesaid, was paid from 1897 to 1902 by the said J. C. McCaul, agent of defendant, Alger, although the money for said salary was furnished by Governor Bliss. By this means one more possible ground of suspicion was removed that defendant, Alger, had parted with the title to said land. Complainants aver that defendant, Alger, in thus carefully and systematically concealing from them all knowledge and all means of acquiring knowledge of the aforesaid sale of said lands, willfully and intentionally deceived complainants, and fraudulently deprived them of rights to Keith v. Alger. which they were entitled under the law, as aforesaid, as the result of said sale." The bill then alleges the institution of insolvency proceedings in the chancery court of Franklin county against the estate of Jno. F. Anderson by James G. Aydelotte and other creditors, the making of an order of reference as to debts, the assets, and the confirmation of the master's report allowing to R. A. Alger a debt of $158,301.82, the balance left of his judgment of $201,014.97, and interest thereon, and some taxes paid, after crediting thereon $50,000 realized from a sale of the 14,804 acres of land, and that the defendant, Alger, was claiming a pro rata on this sum out of the proceeds of the residue of the land of the estate sold in that case for the payment of debts, and that the estate would not have proven insolvent, but for the Alger debt. It was also alleged that when the foregoing decree was entered the complainants did not know of the fraudulent manner in which Alger had procured the decree in the circuit court of the United States, and did not discover such fraud until a short time before the present bill was filed. It is sought in the present bill to set aside the decree obtained in the chancery cause as a consequence of setting aside the decree in the circuit court of the United States. A demurrer was filed to this bill, presenting the following points: (1) That the proper remedy of the com 114 Tenn-2 Keith v. Alger. plainants, under the facts stated, would be by bill of review in the court which rendered the judgment compained of; (2) that the new matter complained of did not go to the merits of the controversy; (3) that the complainants do not come into court with clean hands, inasmuch as it appears to be the purpose of the bill, from its face, to set aside a decree which only takes from them that which they procured from Alger by fraud, and thus enable them to retain the fruits of the fraud. The chancellor overruled the demurrer, with leave to the defendant to rely upon the same grounds in his an swer. Thereupon the defendant filed a special plea of res adjudicata, the substance of which was that, after the proceedings in the present case were begun, the complainants filed their petition in the circuit court of appeals of the United States for the sixth circuit, which had finally determined the litigation between the parties to the present bill concerning the land in question, and had remanded the cause to the circuit court of the United States for the middle division of Tennessee for the entry of the final decree, and which latter court had entered such final decree pursuant to the mandate, in accordance with the practice obtaining in that jurisdiction, for leave to file a bill of review for newly discovered evidence (the same stated in the bill in the present case), and had accompanied said petition with a draft of the proposed bill of review, in which draft the same newly discovered matter set up in the present bill was Keith v. Alger. set out and relied upon as ground for reopening the aforesaid final decree and for a retrial of the issues; that, in further compliance with the practice prevailing in said federal jurisdiction, both parties were permitted to file affidavits on said application in said cause in support of their respective contentions; and that upon the hearing of said matter the said United States circuit court of appeals denied the application, holding that the said new matter did not go to the merits of the controversy, and also that it was fully explained in the affidavits submitted by the present defendant, setting up and showing facts which made it clear to the court that the alleged conveyance to Bliss was in entire harmony with the claims put forward by the present defendant for rescission, in that the rights acquired by Bliss were to abide the result of the litigation, which results he was to receive either in the land, if that should be finally held to belong to the present defendant, or the decree for money, and lien and purchase of the land thereunder in case a rescission should be granted. The foregoing proceedings were relied upon in the plea as an adjudication of the rights asserted in the bill. This plea was set down for argument upon its sufficiency in the chancery court, and upon the argument of said motion the plea was held to be good. Thereupon the complainants declined to take issue upon the plea, and the chancellor entered a decree dismissing the bill. From this decree the complainants prayed an appeal Keith v. Alger. to this court. Here the cause, with the exception of the matters arising upon demurrer, was assigned to the court of chancery appeals. In that court the decree of the chancellor was affirmed, and the complainants thereupon again appealed to this court, and assigned errors. The court of chancery appeals, while not technically passing upon the grounds of demurrer, held that the bill on its face did not present a cause of action, and also held that the plea of res adjudicata was well filed, and sustained it upon its merits. The errors assigned by the complainants in this court raise both questions, and are as follows: "(1) The court of chancery appeals erred in holding that the facts alleged did not, in law, constitute ground for impeaching for fraud the decree of the United States circuit court of appeals, and the order of the chancery court of Franklin county in allowing said judgment as one of the claims against the estate of Jno. F. Anderson, deceased. "(2) In holding that the judgment or order of the circuit court of appeals denying complainants' application to file bill for the purpose of reviewing said judgment was an adjudication between the parties of the same cause of action set up and averred in their bill of complaint in this cause." WILLIAMS & LANCASTER and BROWN & SPURLOCK, for complainants. ESTILL & LITTLETON and LYNCH & LYNCH, for defend ant. |