Southern Pacific R. Co. v. United States, 200 U.S. 341 (1906)
Southern Pacific Railroad Company v. United States
No. 141
Argued January 24, 1906
Decided February 19, 1906
200 U.S. 341
APPEAL FROM THE CIRCUIT COURT
OF APPEALS FOR THE NINTH CIRCUIT
Syllabus
Although a suit in equity cannot be maintained where there is an adequate remedy at law, and this objection may be taken for the first time in the appellate court, still, if not raised until then, the court need not, if the subject matter of the suit is of a class over which it has jurisdiction, dismiss the bill, and so held in regard to a suit brought by the government, under an act of Congress, to recover from a railroad company the value of lands erroneously patented to and sold by it to numerous persons, some of whom were made defendants as representatives of the class, the bill also praying for cancellation of patents, quieting of titles, discovery and accounting
Discovery, although now seldom the object of a suit in equity, and not always sufficient to uphold a suit when the full information is obtainable by proceedings at law, was a well recognized ground of equity jurisdiction.
When by mistake a tract of land is conveyed, and the vendee, prior to discovery of the mistake, conveys to a bona fide purchaser, the original owner is not limited to a suit to cancel the conveyances and reestablish his own title, but may elect to confirm the title of the innocent purchaser and recover of his own vendee the value of the land up to at least the sum received by him. The conveyance to the innocent purchaser is equivalent to a conversion of personal property.
The Acts of March 3, 1887, 24 Stat. 556, of February 12, 1896, 29 Stat. 6, and of March 2, 1896, 29 Stat. 42, do not, in providing for adjustment of railroad land grants, amount to a taking of the railroad companies’ property without compensation because they confirm sales made to bona fide purchasers of lands erroneously patented to railroad companies and require such companies to account for and pay to the government the amounts received by them from such purchasers up to the regular government price.
This was a suit begun in the Circuit Court of the United States for the Southern District of California, by bill filed April 13, 1899. The parties named as defendants were the Southern Pacific Railroad Company, the trustees in certain mortgages, and a number of individuals sued as representatives of a class. In a general way, it may be said that the bill averred that a large body of lands, some 30,000 acres and over, had been erroneously patented to the railroad road company, and that portions thereof had been conveyed by it to bona fide purchasers. The relief sought was the confirmation of the titles of bona fide purchasers, the cancellation of the patents to the other lands, and the recovery from the railroad company of the value of the lands conveyed by it to bona fide purchasers, in accordance with the terms of the Acts of Congress of March 3, 1887, 24 Stat. 556, February 12, 1896, 29 Stat. 6, March 2, 1896, 29 Stat. 42, providing for the adjustment of railroad land grants. After answers by the railroad company and some of the individual defendants, proofs were taken, and, upon a hearing, a decree was entered which in separate paragraphs specifically confirmed the titles to the several tracts held by bona fide purchasers, adjudged that the United States recover from the railroad company the value of those lands, a sum amounting in the aggregate to $33,596.92. 117 F. 544. This decree was affirmed by the court of appeals, 133 F. 651, from whose decision the railroad company and the trustees appealed to this Court.