of the questions in dispute the existence of which is the only possible excuse for the inconsistent attitude of the government.

[8] It remains to determine the rights of the parties in the lands listed in Supplements B and C. The deeds to these properties have never been accepted by the United States. It has never been determined by the General Land Office that the grantors in those deeds had title or that the deeds were effectual to pass title to the base lands to the United States. The effect of these deeds is clearly and concisely stated by Judge Bean, sitting in the United States Circuit Court for Oregon, in United States v. McClure, 174 Fed. 510, 511, 512:

"But the title does not pass to the land offered in exchange until the deed is accepted. The mere execution and recording of a deed and the tender thereof vests no title in the govern ment. Until the deed and title are examined and approved, it is a mere assertion by the applicant of his title and right to make the selection. But the equitable, if not the legal, title remains in him. The deed and tender thereof

*

amounts to nothing more than an offer by the owner to exchange one tract of land for another, and the title does not pass to either party until the exchange is effected."

As is pointed out by Mr. Justice Lurton in Roughton v. Knight, 219 U. S. 537, 548, 31 Sup. Ct. 297, 55 L. Ed. 326, an offer to exchange lands under the act of 1897 is like any other offer, in that it may be withdrawn at any time. The fact that these lands have been offered to the United States has not transferred to the United States any interest in them, and there is no reason why we should not determine the controversy in its relation to these lands in the absence of the United States as a party.

One

tions, including the affidavits, and the jurat was placed thereon by a notary without administering the oath. Another of those through whom Schneider operated was a merchant in Portland. He secured applications in the same manner from his employés. He then worked the neighborhood gathering in, among others, a peanut vendor whose stand was near by. Schneider himself was not idle. He secured applications from the waitresses at the restaurant where he usually ate. He visited the plant at Linnton for the canning of horse meat and secured applications from some of the workmen. These applications signed in blank were taken to a notary who was induced to attach his jurat without the presence of the affiant. third of the state's price was paid down when the applications were filed. Under the practice in the state land office, notes for the unpaid balance of the purchase price were exacted in such cases from the applicants, and the record suggests a wholesale forgery of the notes of these dummy applicants. No applicant who testified has any recollection of signing notes. The applications and assignments thereof were signed at the same time in all cases. The consideration paid applicants ran all the way from $1 to $20. Schneider made an effort to secure some applications at Oregon City through a business man resident there, but this man refused to be a party to the conspiracy. Some of the signatures to the applications were forged. The state was paid in full shortly after the filing of the applications; in some cases, state deeds ran to the original applicants, and they executed deeds in favor of Hyde, Schneider, or others in whose names titles were taken by the conspirators. In no case in which the facts are disclosed by the testimony did an applicant purchase [9] The conspiracy is clearly proved. In for his own benefit; in every instance before the summer of 1898 the defendant Hyde sent signing his application he had made a conthe defendant Schneider to Oregon to secure tract, express or implied, for the disposition applications from residents of Oregon to of the land. By these methods 2,560 acres of purchase state lands located in forest re- state lands were transferred to Hyde, 7,040 serves. He gave Schneider letters of intro- acres to Schneider, 7,040 acres to Flora M. duction and put at his disposal bank ac- Sherman, who was Hyde's sister-in-law, 4,160 counts in Portland and Salem banks. acres to C. W. Clarke, who financed the conThrough the facilities so given him Schneider | spiracy, 17,760 acres to A. S. Baldwin, who secured the assistance of a number of Oregonians of large local acquaintance. It is unnecessary to name these parties, four of whom have since died leaving relatives who reside within the state. One of these men was operating a quarry in Lincoln county. He took with him from Salem a number of blank applications to purchase state lands and blank assignments of contracts of purchase. He induced his employés to sign these in blank, giving them usually a dollar a piece as an inducement. They considered and testified that they had sold their rights to purchase state lands. The affidavits called for by the statute seem not to have been

The first question to be noted is one of fact. Were the applications to select these lands fraudulent, as alleged by plaintiff?

was Clarke's son-in-law, and 2,880 acres to H. S. Morris, who was Hyde's uncle, beside sundry smaller acreages to others under Hyde's control. Hyde associated himself with one John A. Benson for the marketing of the selected lands which they expected to secure in lieu of the state lands so acquired. Benson bribed two of the employés of the General Land Office at Washington to expedite these selections. Deeds were executed and recorded in favor of the United States, and the right to make selections in lieu thereof was advertised extensively and sold to a great extent. The price paid the state was $1.25 an acre. The selection right sold

Q.

same head as homestead or timber claims, or
anything like that, because they bought that
land and paid the state cash for it and the state
price of the land, or whatever it was; and he
says that it was legal to do it. So, well, I told
him if it would be to his benefit we could, be-
cause I had all the rights I had ever had left,
said he would make it all right so I could get
and I thought I didn't need it, but if I did he
my school land if I wanted it hereafter.
How was that to be done? A. Well, I didn't
ask him how he could do it, because I didn't
think he could after I signed my right away
once. And so he come to my house that evening,
and them papers was made out-wasn't made
they were blanks; they were not filled
So he said-well, he asked if the notary public
out; and I signed my name to them papers.
man, named Marion Mays, was home. He
wants to know was the notary public over
there; but he didn't happen to be home, but he
make them out himself because he was a notary
says he will take them to Salem with him and
public himself, and it was filled out here. And
he paid-he says we should take a dollar, be-
cause there had to be money in consideration to
make it legal. Q. Where did you sign these
papers? A. In my home in Morrison.'

[10, 11] The defendant Hyde testifies that he had no knowledge of the manner in which these lands were secured from the state until his criminal trial in 1908. It is not possible to give credence to this testimony. Hyde sent Schneider to Oregon, instructed and financed him, equipped him with letters of introduction, all for the purpose of acquiring large bodies of state lands. Hyde was an experienced land dealer, and he knew that no purchaser of Oregon state lands could buy more than 320 acres, and that only for his own use. The fraudulent char-out; acter of the mission is evidenced by Hyde's instruction to Schneider to pass himself off as a ranch owner who was looking for additional pasture land. The taking of the great bulk of the acreage in names other than Hyde's is a suspicious circumstance. It is admitted that these parties, except Clarke, had no interest in the lands conveyed to them. It is not believable that on Schneider's return to San Francisco he made no report of his doings in Oregon to the man who had sent him to Oregon, or that he failed to account for the large sums of money which he had disbursed. Yet Hyde testifies that he made no report and rendered no accounting. Hyde's alarm, when he learned in 1902 that Schneider had communicated to a special agent of the Interior Department the methods by which he acquired these lands, is inconsistent with Hyde's present claims. Fraud is ordinarily established by circumstantial evidence. Williamson v. North Pacific Lumber Co., 42 Or. 153, 160, 70 Pac. 387, 532; Kabat v. Moore, 48 Or. 191, 198, 85 Pac. 506; Clough v. Dawson, 69 Or. 52, 59, 133 Pac. 345, 138 Pac. 233; Saratoga Investment Co. [12] The defendants contend that the facts v. Kern, 76 Or. 243, 249, 148 Pac. 1125. A proved do not justify the cancellation of the conspiracy may be inferred from circum-state deeds. The argument is that the lands stances. Wilson v. McCarthy, 66 Or. 498, 501, 134 Pac. 1189. While the state's evidence is largely circumstantial, it points unmistakably to the conclusion that Hyde was the author of this conspiracy; that its chief purpose was his emolument; that all other participants operated under his direction; that he was in touch at all times with its

ramifications.

The testimony of the other five applicants is to the same purport. The circumstances under which five additional applicants made their applications are proved by the testimony of members of their families. Two of the agents whom Schneider secured to assist him testified in another cause as to the manner in which the other six applications were secured, and this testimony has been received in this cause by stipulation. In all of these seventeen cases the applications were made for Hyde's benefit and the parties had made arrangements to dispose of the land before they applied for it. The affidavits, if made at all, were false.

secured by Hyde were for sale at $1.25 an acre, that through the activities of Hyde they were marketed at the state's price, and that therefore the state was not damaged. A number of authorities are cited to the point that fraud without damage furnishes no ground for action. Reynolds v. Evans, 123 Md. 365, 91 Atl. 564; Reay v. Butler, 69 Cal. 572, 11 Pac. 463, 467; Woodson v. Winches

The lands described in Supplements B and ter, 16 Cal. App. 472, 117 Pac. 565; United C to this opinion were applied for by sevenStates v. Conklin (C. C.) 169 Fed. 177, 183. teen applicants. Six of these applicants have The general rule announced by these authortestified in the cause. One of them, C. Chris-ities is well established, but it has no applitensen, testified that he was working at a quarry in Lincoln county; that the proprie tor of the quarry sought out Christensen and his wife. He described the circumstances under which he signed the applications as

follows:

"He asked us if we had used our right to school land. I told him no, I had not. Then he wants to know if he could use my name and my right for school land for some one else. Well, I told him I didn't know if that was right, lawful to do that. So he says, 'Yes, it is.' He said he had been clerk of the school land here

cation to this kind of a case. It is the policy of the state of Oregon to sell its school lands only to certain classes of purchasers and in amounts not exceeding 320 acres to each applicant. It is actionable fraud to secure these lands by false affidavits in violation of the statutory provisions for their sale. State v. Carlson, 40 Or. 565, 568, 67 Pac. 516, 517, was a suit to cancel a state deed on the ground that the grantee was an alien when he made his application to purchase. Mr. Chief Jus

"The right to recover is not based upon the fact that defendant was an alien, but because he did not belong to the class authorized to purchase state lands, and that he obtained the title by a false affidavit. The fact that his alienage differentiated him from the class is a mere incident-of no more consequence in determining the question than if his disqualification had been caused by some of the other statutory requisites. The sole inquiry is whether at the time of the purchase and the execution and delivery of the deed he belonged to the class authorized to purchase, and whether the state land board was induced to make the conveyance to him by a misrepresentation of existing facts. If, as is admitted, he was not a qualified purchaser at the time, he clearly obtained the title to state lands upon a false affidavit and in violation of law; and, in our opinion, no subsequent act of his can cure the defect therein. His affidavit accomplished the purpose intended, and was the means by which the state was induced to part with its title, and a fraud was thereby committed."

erside Land & Livestock Company, Willamette Pulp & Paper Company, Alger Logging Company, and Cedar Sheep Association, paid value for the rights which they are asserting, and that they parted with their money without notice of the fraud alleged in this suit. But they are asserting no rights in the base lands except that it be adjudged that title to these lands has passed to the United States. They claim selected lands through the relinquishment of these base lands, and their title to the selected lands is dependent on the title of the United States to the base lands. We have seen that the United States has acquired no title to the base lands listed in Supplements B and C. It follows that the defendants last above named have no interest in these lands, and the question as to whether they are bona fide purchasers of something else is immaterial to the present controversy.

[14] The defendant C. W. Clarke Company is less favorably situated. It claims a large body of selected lands in the state of Washington under four deeds. Two of these deeds run from Clarke and his wife, one from Hyde and his wife, and one from F. A. Hyde & Co., a corporation. All of these deeds recite

The rule announced in the foregoing decision is in harmony with that which obtains in the federal courts in the enforcement of the public land statutes. It has been held many times that patents based on collusive and fraudulent entries will be set aside, notwithstanding the fact that the United States has received the full purchase price of the land. See, for example, Hyde v. Shine, 199 U. a nominal consideration. The claim of this S. 62, 81, 25 Sup. Ct. 760, 50 L. Ed. 90; United defendant is that Clarke advanced large sums States v. Detroit Lumber Co., 200 U. S. 321, of money to Hyde, and that to secure him the 328, 26 Sup. Ct. 282, 50 L. Ed. 499; Hyde v. lands covered by three of these deeds were United States, 35 App. D. C. 451, 488, 489; put in the name of Clarke and of F. A. Hyde Taylor v. United States, 231 Fed. 938, 939, & Co.; nearly all of the stock of the latter 146 C. C. A. 134. Nor is it necessary as a corporation being held by Clarke. The corcondition to relief in such a suit that the pur-poration C. W. Clarke Company was orgauchase price of the property be restored orized by Clarke; its stock was issued wholly tendered. Causey v. United States, 240 U. to Clarke and his family. It is claimed that S. 399, 402, 36 Sup. Ct. 365, 60 L. Ed. 711.

this corporation has succeeded to the debt owing from Hyde to Clarke and that all of the selected lands described in these four deeds are held as security therefor. The corporation can stand in no better position than

Clarke.

The claim that the state has profited by the conspiracy will not bear analysis. The market value of the lands involved in this suit was created not by Hyde, but by the act of Congress approved June 4, 1897. If the lands of the state available for exchange under It appears from Hyde's testimony that statute had been sold only to qualified that Clarke advanced $64,000 which was the purchasers in amounts not exceeding 320 entire capital used by Hyde in his operations acres to each purchaser, the probabilities are in Oregon; that Hyde agreed to pay interest that only small portions of the acreage avail-on these advances at the rate of 11⁄2 per cent. able for base would have been sold at $1.25 per acre and the bulk of the lands involved in this suit would have remained available to be sold at higher prices. It appears from Gov. Chamberlain's message to the Legislature of 1907, received in evidence, that the State Land Board had raised the prices of these lands available as base successively to $2.50, $6.00 and $7.50 an acre.

[13] These appellants, other than Hyde, claim to be innocent purchasers: We have already sufficiently indicated their relation to the controversy. The evidence shows that Western Lumber Company, Anaconda Copper Mining Company, Henry Hewitt, Jr., Martin Barrett, O. S. Lewis, Mrs. Theodore Hampe,

a month; that Clarke was in Hyde's office nearly every day; that he signed powers of attorney in blank and left them with Hyde so that Hyde could dispose of lands which stood in Clarke's name. Hyde's collections in most cases came to Clarke. We have already stated that a large share of the acreage stood in the name of Clarke and his son-in-law, A. S. Baldwin. Clarke signed countless documents to assist Hyde in his operations. Hyde's business consisted chiefly in the transactions above recounted and in similar transactions in other territories. Clarke was financing an unlawful business. We think the evidence establishes that Clarke was a party to the conspiracy. He cannot be held

[15] The answer of Western Lumber Com- | of laches is applicable to the state. State v. pany contains the following allegation:

"That patents for said selected lands have never been issued by the United States, and that charges have been preferred by the Land Department against the validity of the selections aforesaid in lieu of the base lands described in paragraph 3 of said second amended complaint, charging that the title to said base land was procured from the state of Oregon fraudulently and by corrupt practices and in violation of the statutes of the state of Oregon; that such charges are still pending undecided." The other answers contain similar allegations, and these allegations are sustained by the evidence. It is argued from these facts that the General Land Office has exclusive jurisdiction of this controversy, and that the courts cannot determine the rights of the parties until the administrative branch of the government has finally acted. It is said by Mr. Justice Peckham in Cosmos Co. v. Gray Eagle Co., 190 U. S. 301, 315, 23 Sup. Ct. 692, 698 (47 L. Ed. 1064):

"Concluding, as we do, that the question whether the complainant has ever made a proper selection of land in lieu of the land relinquished has never been decided by the Land Department, but is still properly before that department, the courts cannot take jurisdiction and proceed to decide such question themselves. The government has provided a special tribunal for the decision of such a question arising out of the administration of its public land laws, and that jurisdiction cannot be taken away from it by the courts."

Warner Valley Stock Co., 56 Or. 283, 304, 106
Pac. 780, 108 Pac. 861. In United States v.
White (C. C.) 17 Fed. 561, 565, Judge Sawyer
says:

"Although statutes of limitation do not run against the government, yet the staleness of the claim may be taken into consideration in determining the question whether a court of equity should interfere and grant relief when the United States, as well as a natural person, is a complainant. When the United States comes into a court of equity as a suitor, it is subject to the defenses peculiar to that court."

In Commonwealth v. Philadelphia Co., 153 Pa. 53, 25 Atl. 1105, 1106, Mr. Justice Potter

says:

make up a species of fraud, and estop even sov"Time, together with other elements, may ereignty from exercising its legal rights."

[17] Is it inequitable to grant plaintiff the relief to which it is otherwise entitled because of the delay in bringing this suit? The fraudulent applications were filed from July to November, 1898; most of them in August. This suit was brought August 13, 1913, fifteen years after the cause of action arose. It was a circumstance of suspicion that 146 applications should be made in so short a time to purchase state lands in the forest reserves, especially as these lands were for the most part in remote, inaccessible sections of the state. It was also a sus

sue in so short a time to a handful of nonresidents transferring many thousands of acres of state lands. These matters seem to In Hall v. Catherine Creek Co., 78 Or. 585, have passed unnoticed by the state officials. 593, 153 Pac. 97, 99 (L. R. A. 1916C, 996), Mr. Justice Burnett says, in speaking of the notice which will charge a party defrauded with the duty of asserting his rights: "The notice must be more than would excite the suspicion of a cautious and wary person." This language was adopted from the opinion of Mr. Justice Wolverton in Raymond v. Flavel, 27 Or. 219, 246, 247, 40 Pac. 158. It is also the doctrine of Crossen v. Oliver, 37 Or. 514, 521, 61 Pac. 885, and Coffey v. Scott, 66 Or. 465, 467, 135 Pac. 88. Laches is therefore not imputable to the state in its failure to act at the inception of the fraud.

The doctrine so announced is well estab-picious circumstance that deeds should islished and has been recognized by this court. Weatherford v. McKay, 59 Or. 558, 564, 565, 117 Pac. 969. See, also, Oregon v. Hitchcock, 202 U. S. 60, 70, 26 Sup. Ct. 568, 50 L. Ed. 935. But the jurisdiction of the General Land Of fice is confined to the public domain. Knight v. United States Association, 142 U. S. 161, 12 Sup. Ct. 258, 35 L. Ed. 974. The General Land Office has no control of lands offered to the United States under the act of 1897 until it signifies its acceptance of the offer and thereby vests the title in the United States. When this is done, the jurisdiction of the administrative bureau attaches, and the courts will not interfere with its operations until it has disposed of the matter. This rule prevents us from proceeding with so much of the controversy as involves the lands listed in Supplement A, but it does not relieve us of the duty of determining the rights of plaintiff to the lands listed in Supplements B and C. There is nothing to prevent the withdrawal of the offer of these latter lands to the government at any time. Roughton v. Knight, 219 U. S. 537, 548, 31 Sup. Ct. 297, 55 L. Ed. 326. The United States having no interest in them, the General Land Office has no control over them.

[18] The evidence fails to charge the state with further notice except rumors, till 1905. The message of Governor Chamberlain to the Legislature of that year called attention to abuses which had grown up in the administration of state lands, and on April 28, 1905, the grand jury for Marion county reported to the circuit court for that county that there had been gross violations of law in taking up state lands. These charges were [16] It is next contended that plaintiff has general; they did not refer particularly to been guilty of laches, and that for this rea- the applications with which we are concernson its suit should be dismissed. We are ed in this case. During the year 1904 rucommitted to the principle that the doctrine mors of fraud in some of the applications

reached the ears of Hon. Oswald West, state It is to be said that, notwithstanding the land agent, and in 1905 he made a trip to time which has elapsed, the evidence is reLincoln county to investigate the applica-markably clear that there was a conspiracy tions secured there from the workmen at the quarry. He followed this up with a trip to Portland to investigate the Hyde applications secured there. He was advised by applicants whom he interviewed on these trips of the circumstances under which they had executed their applications.