by extrinsic evidence, th9.t the precise question was raised and determined in the tormer, sUlt."'!RllllSell v.Place, 94 U. So 606-610.
The, Js, "Nemo debet vexari pro eadem causa." '" " ' Another position of complainants, in denying the sufficiency of the plea, i$ that there. was n(f iln.al hearing', and decision of the cause in the upon its there was no issue,npQ11 the facts, but only upon the law. It is true that the cause was decided upon a demurrer to the bill, but the decree was:final, and ended the life of the bill. It was dismissed. A' demurrer admits thetl'l)'th of every al,the bill whichi$ ;prbperly plOOded. It, is for bearing as though e'YWY material fact alleged were proven. The merits of the cases, as stated by complainants, must be conl!lidered and passed upon. The answer of the court to complainants' ,case W!ls: "Take it for granted that every essentiaJ fact you state is trUe" the law can give, you no relief." It is the failure of the facts to make out a case which bars the, relief. , They needmore or betterfaots, not other 3nd different law. But iUs determined by authority as well as reason. Aurora Oity v. West, 7 .WaJI.82, decides that,', , ,
"Where a judgment is rendel'ed on the, merits, whether on demurrer, agreed statement, or verdict, it extends to every material allegation or statement wWch, ha$g b made on one side and denied on the other, was at issue en and In the course of the proceedings." , In tlle
If the 'averments of defendant's plea be sustained by, proof, it is clear, so it seems, that cOlllpiainants' suit is barred by the decree in the state court, and the plea must be held to be sufficient. Defendant brings along with its plea a copy of the record' of. the cause in the state courts, as is admitted by the parties. An examination of this copy must cOlllvince the mind that the suit in the state court has not onIythe same parties and the'same subject-matter as in the suit in this court, but that the relief sought is the same in each. The framework of the two bills is the same, but complamants have leave to join iSsue upon the plea, if they so desire.
RUGAN et at v. SABIN et aI. (Circuit Court of Appeals, Eighth Circuit. December 6, 1892.)
EQUITY-RESCISSION OF SALE...:.FRAUD-NOTICE.
An attorney misrepresented to his principal, who resided in another state, the amount of liens on certain propert:r, and the value of the principal'i' interest tl1el'ein, and thereby induced the principal to sell I1t a grossly inadequate price to a supposed third party, with whom the attorney was In fact jointly interested. Another attorney notified the principal of the true condition of affairs within 40 days thereafter, but the principal, to Whom the first attorney had written to persuade him th'lt the sale was for his interest, did not return the purchase money, nor announce his intention torepudiate the sale, but remainl'd silent until his death, more than seven years thereafter, during whioh time the had greatly Increased in value. Held,. that he had eleoted to ratify, and that the sale ('.QuId 'not be rescinded by his heirs.
Consolo St. Neb. p. l1rnitsaotlonsfdr rel1at on: the ground Of fraudto fo,ur years after discoverY. In t1lat stl,lte the distinction. be.(meentUe fomnsof at Iawand' suits thE!qult:y aboliShed. Held, that the statute shc.uld control a federal court sitting in equity, and . '..'t ,.th.e. ,.ot ,aI\Y fa. if pursued, ,tQputa fonr. years b.. . ,ry 'l"UD.. f. ro.m. tlro an inquiry,which,0.ts SUffiC.ient pf9r, .. t,o . "WOilld lead to discovery of the fra)ld. Parker y, KUhn, 82 N. W.Rep. 74, 21) Neb. as; !Wright Vi' Davis, 44' N.W. 490, 28 Neb. 479,-approved. 3; 8AlilIl:-DmABILITI.1l1S AND ExoEk-TIOlirS. ' ' . ha,s. J.:>eenilld,uced to sell by :fra1,ld.: ana: has failed to !liscovery, facts that he at time credulous, :m,d In miIi.d body tl:i,atne., was b)lsiness, a,re since $1ich disability is nb'tsllfJlCient to prevent the runntngo't Ule not illCluded among.those to which the statute expressly gives thiS effect.
Appeal from the Circuit Court ·of the United States for the District of Nebraska. In.Equity. Bill by Eunice Rugan., Louvira Hart, and Martha'E. Edwards against Robert W. Sabin, Gabriel. Beachley, and Mary L. Sabin, to set aside a sale of land, and for further relief. Demurrers to the bill were sustained. Cbmplainants appeal. Affirmed. ' by SAN130RN, Cil'cuit, Judge:
·.rheappE'1lanbl bl'oughtsuit in the court below to set aside a sale of 80 acres of land lliiLde by their falher to tlieippellees Robert W. Sabin and Gl\-brlel Beachley, and to rt-co,er of them and Mary IJ.Sabin, the wife of Robert, a portion of the land, which t!l.ey stiU hold, antI the proceeds of a portion that has been sold. The appellees interpf'sed demurrers to the bill. The court below sustained the demurrers, and dismissed the bill, and this is the supposed error of which appellants' complain. 'l'he following is thesta:te of facts disdosed by the bill: .. . 'l'he- avpellants are . nlY heirs at l.aw of Chatl.es B. Holt, who died in· . testate March 4, 1889.' Holt resided in Illinois, and owned 160 acres, of llUid near Beatl:i.ce, Neb., upon wb'ich there were cel'tain tax liens, and ill the fall of 1880 he 'went :to Nebl'm.ka, and conveyed an undivided half of this land the appellee Robert W. Sabin, for the benefit of himself and his part· lier, J. A. Smith, who to institute and carry through the courts of Nebraska an action agalll.1lt the holder of the t1lX liEnS for ,the recovery of the luud. They commenced' the action, and on December 24,' 1883, obtained a final decree for its recovery upon the payment of $403.55 on account of the tax liens, which was then palO.. On April 13, 1882, after this action for the recovery of the lands had b decided in their favor in the trial court, and 'en while it was pending on a writ of error in the supreme court of the state, Sabin, with the knowledge of appellee Beachiey, and for the purpose of obtaining a conveyance of MQlt'R undiyided interest in sald land, represented to him that it'· wasdoubtf1l1 which side Would be successful in sald action; that, if they snccee'ded, thf'Y would be compelled to pay $1,000 for taxes and $300 for improvements; that he. had tried to find, and had finally obtained, a purchaser for Holt'S interest in the land, who would give $800 for his quit· claim deed, and relieve him from all further cost, liability, or trouble in the matter; that this Beachley, and that he thought the offer a good one, and advised him to acceptit,-while the facts, which Sabin well knew, were that the title of Holt and Sabin to the land was perfect; the issue of the action was not doubtful; the aggregate amount of the liens they would have to pay if fiuccessful did not exceed $335.87, as the jury on the trial had found that the}' were entitled to recover of the defendant $515.16 as rents and profits; that the $800 was not a good offer, but a grossly inadequate price for Holt's interest in the land, which was worth $4,000; and that Sabin had not tried to find a purchaser, and was not acting for Holt In selling bls land, but wss jointly interested with Be'lchley in its purchase from him, but concealed this fact from Holt, and pretended to be acting in
his behalf. At this time Holt was about 70· years old, and the bill that for 10 years prior to March 4, 1889, he was so feeble in mind and body that he was entirely unfit and unable to transact any business whatever, and from age and weakness possessed such a disposition that lie. was easily imposed upon, and implicitly trusted thos\! he thought his friends, and that he relied upon Sabin as his attorney, friend, and adviser'; but it also alleges that he walked all the way from Illinois to Beatrice, Neb., and made we 0011tract for the commencement of his suit in the fall of 1SSO. Holt, who was ignorant of the value of his land, and of all the facts misrepresented by Sabin, was induced by Iris false reprE:sentations to convey his 'interest in the land to Beachley for the $800, and under this conveyance the appellees hold a portion of the land and the proceeds of that not held by them. After Holt made this conveyance, J. A. Smith, who was also one of his attorneys in prosecuting the action for the recovery of the land, wrote him three letters, the last of which was dated May 18, 1882, in which he stated to him that Beachley had purchased the land for the joint use of himself and Sabin; that the consideration paid by Beachley was inadequate; that it appeared from the records that Sabin had sold his own 24 acres of said tract for $500; that Smith himself had paid L. W. Billingsiey $700 for the ro acres of said tract owned by the latter; that Smith bimself would have paid Holt $1,400 for the interest in said tract which was conveyed to Beachley. expecting to have doubled his money by such purchase; that Smith did not believe that Holt ever parted with his interest in the landfor $800 with ll. knowledge of all the facts in the case, and inqUired of Holt whether or not Sabin had ever notified him that, besides winning the land in the lower court, Sabin and Holt had been awarded $515 by the jUry for the rents and profits of the premises in question. OIi the !f.,th day of May, 1882, Sabin wrote and mailed Holt a letter, of which the following is a eopy: "Beatrice, Neb., l\lay 15, 1882. "Charles B. Holt, Esq., Flora, Ill.-Dear Sir: Since writing, I heard that there were some parties here that intend. to try and get you into some kind of litigation, and get the money you have away from you. I don't know that it is so, but I fear it; and I write to put you on your guard as a friend, ann be watchful and careful. I Vlould not have anything to do with any other parties here, because I think they want to find out where you are, and may get you into trouble. If I knew anything certain I will write you. 1 would keep out of their wf;.Y. I don't like to mention names at present, but if I think it necessary will write you more particular. If you get any letters you might send them to me, and I will write you what is best to do. R. W. Sabin:' "Your friend, as ever, '[he appellants knew nothing about these transactions until these letters of Smith and Sabin were discovered, after the death of Holt, in 1S89. They offer to return to the appellees the $800 paid to Holt in 1882, with interest, and all taxes paid by them upon the land since that date, with interest, and ask to recover of them that portion of the land they still own, Dnd the proceed" of the portion sold.
Nathan K. Griggs, Samuel Rinaker, Robert S. Bibb, and Julius A. Smith, for appellants. Leander M. Pemberton, for appellees. Before CALDWELL and SANBORN, Circuit Judges, and District Judge. SANBORN, Circuit Judge, (after stating the facts.) The basis of this suit is the fraudulent misrepresentation which induced the sale and conveyance of May 15, 1882. The relief sought, so far as these appellees are concerned, is the rescission of the conveyance and con· tract of sale, and the restoration of the parties to the condition in v.53F.no.4-·27
contract had· never been made. cannot hOld"property inwhielf he. booomes in· ..' while h.e to .the sale as of the. wndor;, and the glar.ing; fraud the bill difd.entitled Mr. Holt to return the purchas6,'pricehehad reo 00f Tecover back the land he had conveyed, immediately ;ai;$CQJery of tlle TJiia discm'ery; lrowever, while it pnvilege,also impose,d 'lpon hi:rn the dUty of electing than,whe.th:er: ,he would rescind or ratify his contract., ,When a vendor discovers that his l)urehaser has induced him to part with his property b;tfriiud,he toretur:n the purchase price, and recover his the ratify tlle sale. To him the !a,w justly. bives the. choice of the course he will pursue, but it de· mands of him that he make his election with. diligence, promptly;, and qeclares thatsl1ctreiection, once made, cannot be revoked' llJlon his option. He cannot hold his election in,litbeYlIDce, so that he, mfl,y Stlbsequently rescind if the propertyrises,andratify if it depreciates, in value. Indeed, he can· n01;"under the'law,if'¥-e would,. avoid an immediate election. If he av-pid his itnd'repudiate his contract, he must prompUy announce this intention,' and return the consideration he received, to the end that the parties may be put in statu quo before, SUbsequent tjansactions render suehaction impossible. If he does nothing; if he remains silent and takes no action,-his very silence and his retention and use of the purchase money for any considerable length'oftime th,e.disvovery of the'fraud constitnte a complete, irrevocable ratification of. his contrfl,Ct, ,and make it as binding and effectual a.s though he had deliberately entered into it after full knowledge of all the facts, uninfluenced by any fraudulent practices. Thus, in Grymes v. San(lers, 93 U. S. 55, 62, Mr. Justice Swayne said:
'tVbidlv theywo'Uld have been
"W)lere a party desires. to rescind upon the ground of mistake or fraud, he must, upon the discovery of the facts,at once announce his purpose, and adhere to it. If he be silfilnt, and continue to treat the property as his own, he will beheld t() have waived the objection, and will be conclusively bound by the contract, as if the mistake or fraud had not occurred. He is not permitted to phly fast and loose. Delay and vacillation are fatal to the right which had before subsisted, These remarks are peculiarly applicable to speculative prop' erty like that here in q\1.estion, whicl1 is liable to large and constant fluctuations in value. Thomasv. Bartow, 48 N. 'Y. 200; Flint v. Woodin, 9 Hare, 622; Jennings v. Broughton, '5 De Gex, M. & G. 139; Lloyd v, Brewster, 4 Paige, 537; Railroad Co. v. Row, 24 Wend. 74; Minturn v. Main, 7 N. Y. 220; 7 Rob. Pr. p. 432, c. 25, § 2; Campbell v. Fleming, 1 Adol. & E. 41; Sugd. Vend. (14th Ed.) 335; Diman v. Railroad Co., 5 R. I. 130."
:Nor can a vendor industriously close his eyes, stop his ears, or reo fuse to believe the e,idence of his senses, when notice of the fraud· ulent practices of a purchaser is placed before him, and thus escape from the application and effect of this principle of law. Notice of facts and circumstances which would put a man of ordinary intel· ligence and prudenceon.inquiry iS,in the eye of the law, equivalent to knowledge of all the .facts a rea.sonably diligent inquiry would disclose. ''Whatever is. notice enough. to excite attention, and put the party on his guard, and call for inquiry, is notice of everything j:.o which such inquiry might have led. Where a person ha.s suf-
RUGAN fl. BABIN.
ficient information toieadhfmto a fact, 'he shall be deemed conversant with it." Kennedy v. Green, 3 Mylne & K. 722 ; Wood v. Carpenter, 101 U; S. 135, 141; Parker v. KUhn, 21 Neb. 413, 421--426, 32 N. W. Rep. 74; Wright v. Davis, 28 Neb. 479,483, 44 N. W. Rep. 490. . The application of these principles to the facts disclosed by this bill is decisive of this case. The only facts alleged thataie at all sufiicient to be considered as ground for the relief sought are that Sabin, who was one of the vendor's attorneys, concealed the fact that he was jointly interested in the purchase, and the amount required to be paid on account of the tax liens and'the value of the vendor's interest in the land when he procured the deed to Beachley: but the appellants have seen fit to set forth in their bill, and therehy to admit, that Mr. Smith, who wa:s also an attorney of the vendor, residing at Beatrice, Neb., equally interested with Sabin in, and equally conversant with, the pending action, and the land it involved, fully notified this vendor, in writing, in May, 1882, and within 40 days after he made the saJe and deed to Beachley, of every material fact that had been concealed or misrepresented by Sabin. It is difficult to imagine more conclusive proof than this that the vendor then discovered the fraud. He was fully notified of it by an attorney who was employed to watch his interests, and who, he knew, had ever.r means of knowledge; and this attorney referred him to the recordS of his county to substantiate his statements. These allegations of the bill are the equivalent of a positive averment that Mr. Holt had full knowledge of this fraud in May, 1882. What, then, was the action of Mr. Holt when this fraud was thus discovered, and what was its legal effect? He did not return the purchase money; he did not announce his intention to repudiate the sale; he did not seek to recover back his land, or to recover damages for the injury he had sustained; he did not complain of it, or notify his children or anyone else of the fraud that had been perpetrated upon him; but he quietly retained and used his purchase money, and lived on in peace and silence for seven years and seven months, until he died; and the first complaint of this fraud is made by his heirs, more than eight years after its discovery. The course thus pursued by this vendor leads inevitably to the conclusion that, after learning all the facts, he deliberately elected and intended to keep his purchase money, and to stand by and ratify his sale; but, whatever may have been his intention, his silence during those seven years while the property conveyed was constantly changing in value and becoming a platted addition to a city, was an effectual and irrevocable ratification of his sale and deed, and binds him and these heirs who claim under him as con· clusively as would an independent contract, deliberately made after full knowledge of all the facts. Neither he nor his heirs could thus play fast and loose with this contract for eight years after the discoy· ery of the fraudulent practices. Long before his death all objections to it had been waived, and it had been irrevocably ratified by this action of the vendor, or, rather, by his failure to act; and llpon this ground the decree below must stand. 'l'here is another reason why this decree must be sustained. It
is that the action for relief on account of this·fraud was barred by the l:ltatute of limitations of. Nebraska. That statute provides that actions for relief on the ground of fraud can only be brought within fOll.1'.: Jears after its discovery. Consolo St. Neb. p. 971,§ 4548. The highest judicial tribunal of that state has twice decided, after ex· haustive discussion and careful consideration, that the four years prescriJled in this statute commence. to run from the "discovery of the facts constituting the fraud, or facts sufficient to put a person of ordlnary intelligence and prudence on an inquiry which, if pursued, womd.ead to such discovery." .Parker v. E:uhn, 21 Neb. 413, 421--42(;, W. Rep. 74; Wright v. Davis, 28 Neb. 479, 483, 44 N. W. Rep. 4:90. .This construction of this statute commends itself. to our judg· mentas sound and just, and it has been approved by the supreme coqrt of the United States in the consideration of similar statutes. BurkE;! v. Smith, 16 Wall. 390, 409; Kirby v. Railroad Co., 120 U. S. 130, 139, 7 Sup. Ct. Rep. 430. comts of Nebraska remedies at law and in equity may bH adruim.stered. in a singlea,ction, and by the same court; the distinction between the forms of. actions at law and suits in equity has been abolished. . It follows that the .vendor ill this sale was barred by this statute of all relief in the courts of that state four years after he discovered this fraud, Qr .in, lIay, 1886. Incases of concurrent jurisdiction, the. federal courts, sitting in equity, cQnsider themselves bound by the statutes of limitation which govern. co;urts of law in like cases, and.this is rather in obedience to the.statQte of than by analogy'. In many.other cases they act uppnthe analogy Qftlle statutory limitations at law. Courts of equity generally act refuse to act.in analogy to the statute, and they will not be moved to aside a fraudulent transaction at the suit of one WllOhas been quiescent during a period longer than that fixed by the statute of limitations after he had knowledge of the fraud, or afteJ,"he was put uponjnquiry with themeans of knowledge accessibll'j to him. Wagner v; l3aird, 7 HQw. 234, 257; Godden v. Kimmellj99 U. S. 201, 211); Burke v. Smith, supra; Kirby v. Railroad Co., supra; Boone Co. v. Burlington & R. R. Co., 139 U. S. 684, 692, 11 Sup. Ct. Rep. 687. This suit was commenced January 3, 1891. Mr. Holt, under whom appellants claim, discovered the fraud which is the basis ot the suit in May, 1882. Every action in the courts of Nebraska for relief on this account was barred more than four years before this suit was commenced. It follovifl that the court below properly refused to be moved to set this sale and deed aside after tho victim of the fraud had remained quiescent for a period longer than that fixed by the statute after, he discovered The rule that length of time is no bar in equity to a suit for relief from an actual fraud 01' a constructive trust clearly proved, which has been fraudulently and .successfully concealed from the party aggrieved, has no application to this case. . One of the qualifications of this rule is that the facts constituting the fraud or trust must have been fraudulently and successfully concealed from the injured party. Badger v. Badger, 2 Wall. 87, 92. In the case we are now considering the facts constituting the fraud were all disclosed to the party injured
RUGAN V. SABIN.
by one of his attorneys in May, 1882. That the perpetrator of the fraud in the same month, with intent to conceal it, wrote him the letter of May 15, 1882, and advised him to have nothing to do with any parties who might write him from Beatrice, lest they should rob him of his money; and that, R'usting to this letter and its writer, he did not belieye in the existence of the facts disclosed by his attorney, Smith, and made no inquiries regarding them,-doeg not Rhow a successful concealment of these facts. Sabin's letter did not-indeed, it could not-eonceal the facts, because they were fully disclosed by the letters of Smith. They were then known to Mr. Holt, and the letter of Sabin could not make them unknown. It could nOli do more than persuade him, with knowledge of the facts, to ratify the contract, and retain the purchase price; and, if he did this, he has no cause of action. Indeed, there was nothing in the letter which either denied or explained any of the statements in the letter of Smith, and, if there had been, this would have been no excuse for failing to investigate or verify them. The victim of a fraud, fully and credibly informed of all the facts which constitute it, cannot obstinately refuse to belieye or verify his information, and then plead his own negligence and incredulity to remoye the bar of the statute, and prove that he made no discovery of the fraud. Nor can he, after the fraud is clearly disclosed to him by others, escape the bar of the statute by the plea that the perpetrator himself did not disclose it. As was well said by Judge Caldwell in Singer v. Jacobs, 11 Fed. Rep. 563: .
"'When the facts and circumstances are such as to put a reasonable man upon inquiry, that obligntion is not satisfied by an inquiry addressed to the chief actor in the suspected fraud, who has every motive for concealing the truth, when better and more reliable sources of information are open to him."
See, also, Wood v. Carpenter, 101 U. S. 135, 139--143, and cases there cited. The allegations in the bill that the vendor, Holt, was for 10 years before his death old, credulous, and so feeble in mind and body that he was unfit to transact busiuess, are not sufficient to preyent the running of the time named ill this statute. The" statute itself prescribes the disabilities which shall haye this effect. They are infancy, coverture, insanity, and imprisonment. Consol. St. Neb. p. 971, § 4553. "Expressio uDius est exclusio alterius," and it is not the province of the" courts to add to these disabilities either age, infirmity, or credulity. These allegations of the bill do not amount to an averment that this man was insane, or non compos mentis, for Lord H3J'dwicke says that"'Being non compos'-of unsound mind-are certain terms in law, and import a total deprivation of sense. Now, weakness does not carry this idea along with it; but courts of law uudE'rstand what is meant by 'non compos' or 'insane,' as they are words of determinate signification." Ex parte Barnsley, 3 Atk. 168.
The law, therefore, must deal with this vendor and his acts on the presumption that he was a man of ordinary intelligence and prudence, because, as was well said by Verplanck, Sena,tor, in Stewart's Ex'r v. Lispenard, 26 Wend. 303:
"To establish any standard of intelligence or information beyond the possession of reason in the lcwest degree, as in itself essential to legal capacity,
dIffi.culty, ,and litigation;. WOuIdshake the Ilndwresf fr0ll;lthe Rgf;ld and Infirm, PHlt ?ver thei'r eafufilgs ,Ql' conveyances .which is Often their best sec,UHty aglilnst IllJury ilillfneklect'.I'''' i /' , . ',: ' '. " .. .'
bill that within theSe 10 years during is to have been so feeble,.in mind and body thltthe}V¥ un1it to business he was strong enough in body and to walk from his home in Illinois to Beatrice, and make,:the contract with his attorneys for the prosecution action the holder of the tax title, ,which resulted of this land, and we should long to establish, that a of such and ability was incapable of traIl$acting his own business. that this-vendor, by his: retention and use of the purchase money, and his silep.ce and acquiescence in the sale of his land for more tb,iin seven ye%'S after he discovered the fraud which induced it, irrevocably ratified that sale, and neither he nor his heirs can now be repud\ate or rescind it; and, moreover, a court of whichacbJ or refuses to act in analogy to the statute of limitations, will ,not now be moved to set aside this sale after this vendor has silent for a longer period after he discovered the facts constitu,tingthe fraud than the time limited by the statutes of Ne· braska fOD.ijle commencement of actions for relief on account of it. The decree therefore is affirmed, with costs. .
TUTTLE et ux. v. CHURCH et aL
f ".,: ':;3,""
(Circuit Court, D. Rhode Islnnd.
December 21, 1892,)
The operation of a factory for making 011 and fertilizers from fish should not be <'11 the petition of the owner of a summer cott'tge, rlistant a mUeand a half thm'efrom, when the family of counsel instigated, illrected, .and furnished money to Cl!-rry on the suit; when there Is no regular or serious pollution of the aDd the ofrensive odors have decreased by reason of improved processes so as to be seldom troublesome in the. summer; When the cottager hl18 lived in that vicinity 13 years and in bis present house 10 years, wblle the factory had been in operation 20 years; llDd when the granting of an iDjunction would inflict . great injUry upon the factory owners and mall,Y employes, whj!e its denial would injure the cottager but little.
.In Equity, .Bill by Elias A. Tuttle and wife against Daniel T. Church and others, doing business under the firm name of Joaeph Church & Co., to enjoin them from maintaining a nuisance. Bill dismissed. . Patrick ;T. Galen, Benjamin Barker, Jr., and Arnold Greep., for complaitiantR, Miner & Roelker, for defendanbJ.
COLT, Circuit Judge. This bill in equity is brought to enjoin the defendants from maintaining an alleged nuisance. The defendants, under the firm name of Joseph Church & Co., are engaged in the business of expressing oil from fish, and the manufacture of fertilizers