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Statement of Facts.

The proofs so taken before the register in bankruptcy were used in evidence, and further proofs were taken on both sides. An order of reference to a master was made in June, 1879, under which, after taking further evidence, he reported as to the rental value of the property from July 12th, 1875, during the time Conro & Carkin had it, and as to the amount of profits they derived from it while they had it, and also as to what they paid for repairs on it, and as to what Crane and Hodgkins had paid for fees and expenses in recovering or defending the title to the property in the previous litigations. The appellants and the appellees excepted to the report, and the court made a final decree which contained the following provisions:

"That the said defendants Albert Conro and Willard S. Carkin be held to account for the reasonable value of the use of said property in the pleadings described, while the same was withheld from the possession of the said complainants by the defendants Conro & Carkin, which value, in the judgment of the court, is, in this case, equal to the net profits realized by them from the use of said property other than pile-driver No. 6, from July 12, 1875, to May 5, 1876, being, as the master reports, the sum of fourteen thousand six hundred and ninety-three dollars and seventy-nine cents ($14,693.79), the report of the said master in that behalf being hereby confirmed; and that the said complainants ought to have and recover of the said Albert Conro and Willard S. Carkin the said last mentioned sum, with interest thereon at the rate of 6 per cent. per annum from May 5, 1876; and also that the said complainants are entitled to a decree against the said Albert Conro and Willard S. Carkin for the further sum of three hundred dollars ($300) for the use of pile-driver No. 6, with like interest from the 9th day of May, 1877; and that the said complainants ought to have and recover of the said Albert Conro and Willard S. Carkin the said last mentioned sum with interest as aforesaid. And it further appearing to the court that the said two sums of money and interest thereon as aforesaid amount, at the date of the entry of this decree, to the sum of eighteen thousand and seventy dollars ($18,070.00), it is thereupon further ordered, adjudged, and decreed by the court, that the said com

Opinion of the Court.

plainants do have and recover of the said defendants Albert Conro and Willard S. Carkin the said last mentioned sum of eighteen thousand and seventy dollars, besides the costs of this suit, to be taxed."

From that decree Conro & Carkin appealed to this court.

Mr. Lyman Trumbull for appellants.

Mr. John S. Cooper for appellees.

MR. JUSTICE BLATCHFORD delivered the opinion of the court. He recited the facts in the foregoing language and continued: It is contended by the appellants that the Circuit Court had no jurisdiction of this suit because the assignee was a citizen of the same State with the plaintiffs. But no relief was granted against him by the final decree, and, although the suit was not formally dismissed as to him, it is evident that he was treated throughout as only a formal party. There was jurisdiction by citizenship as to the other parties, and the real controversy was between them. The record does not show that the appellants raised this question in the Circuit Court. Under these circumstances, it is not proper to allow the jurisdiction between the real parties to be now challenged on this ground.

It is also contended that the remedy of the appellees was at law and not in equity. Waiving the consideration of this question, we prefer to dispose of the case on its merits.

We are unable to perceive any relation of trust between the appellants and the appellees. The former were clothed with no fiduciary character as respects the latter, by reason of any relation existing between them prior to the making by the appellants of their bid, nor did the holding of the property by the appellants create such relation. The appellants received the property and paid their $40,500 under the sanction of an order of the court, which not only authorized the sale to them but set aside the order of sale to Hodgkins and annulled such sale. They purchased at a judicial sale, and received the property from the hands of the court. The court made the second order of sale without notice to Hodgkins or Crane. That was

Opinion of the Court.

held to be erroneous. On a hearing, the District Court maintained the propriety of the order. On review, the decision was reversed, and the Circuit Court, being of opinion that, on the payment by Hodgkins of the purchase-money, the original order of sale to him vested in him, from July 9th, 1875, all the right, title, and interest of the bankrupts in the property, directed that the District Court order the assignee to deliver to Hodgkins the necessary title papers of the property, and cause the assignee to deliver the property to Hodgkins or Crane. It also directed the District Court to return to Conro & Carkin their $40,500, the order saying, "the sale to them being hereby annulled and set aside." The order did not conclude or determine anything as to any liability of the appellants to any one for profits or rent or value of use of the property. On the contrary, it gave to all parties, the appellants, or the appellees, or the assignee, the right to institute legal proceedings in any competent court to determine the rights or equities of the parties growing out of the possession of the property by the appellants, and out of their having paid moneys for claims, expenses, improvements, and repairs thereon, and out of the profits, as to all of which matters it stated a question was raised. The declaration in the order of the Circuit Court, that Hodgkins, having paid his $40,000, was vested, by the order of July 9th, 1875, from that date, with the title of the bankrupts to the property, did not confer on Hodgkins or the appellees the right to collect rent, or value or profits of use, from the appellants, for the time they had the property. Nor did the provision of the order in regard to the retention by the District Court of part of the money paid by the appellants, or the giving of security by them, have that effect. The question of their liability depended on many other considera

tions.

There was no privity of contract between the appellees and the appellants. The latter held the property adversely to the former for 8 months and 29 days, and all the time under the authority of an order of the District Court. The appellees recovered possession of nearly all of the property 25 days after the order of the Circuit Court was made. The appellants were

Opinion of the Court.

deprived of the use of their $40,500 from July 12th, 1875, to May 24th, 1877, a period extending beyond the time during which they held any of the property, and the money was returned to them only on their giving a bond with three sureties. The appellees succeeded to the title of the bankrupt and the assignee to the property from July 9th, 1875, according to the order of the Circuit Court, but they could have no greater rights in respect to recovering from the appellants for the use of the property after that date than the assignee could have, because they held under him and derived all their rights from him; and he could have none so long as he withheld the $40,500 from the appellants. He could not keep the money and still have rent for the property. That would be to keep the money and virtually the property too, by recovering for the use of the latter. The legal presumption is that the appellants could, by the use of the money, have procured like property, and made out of it the profits decreed against them.

The rights in question which the appellants acquired by the judicial sale are to be protected so long as the order of sale was in force. Moreover, during the entire period, after the order was reversed as well as before, the court and the assignee retained the money of the appellants. The title of the appellants to the property and their right to keep it as purchasers were, undoubtedly, subject to the result of the litigation had. But a rescission of the sale and the destruction of their title involved, as a necessary element, the return to them of their money, so far certainly as any claim for rent or profits was concerned.

We do not think it necessary to refer to the voluminous testimony adduced on the question of bad faith and fraud. We see no sufficient evidence to impeach the good faith of the appellants, nor do we understand from the opinion of the Circuit Court on the review in bankruptcy, that that court questioned their good faith or fair dealing, whatever views it expressed as to the conduct of the assignee.

The present case has no resemblance to one in which a purchaser has been held entitled to a rebate or allowance from the purchase money of land, for occupation or rent while kept out of possession by a plaintiff, on a sale made by the court in the

Opinion of the Court.

suit, and for expenses of obtaining possession. Thomas v. Burton, L. R. 8 Eq. 120. If the appellees might have been entitled to a deduction from the amount of their bid because of the action of the assignee, the bankrupt estate could not reimburse itself for its loss from such action by making the appellants responsible for it.

Nor does the doctrine applied to a purchaser who buys land with notice of a prior equitable estate apply to the appellants. The District Court vacated the prior sale by the same order which accepted the bid of the appellants, and the order referred to the petition of the assignee, which set forth that Hodgkins had not paid his bid, and there was annexed to the petition a copy of the bid of the appellants, which stated that they made it understanding that Hodgkins had not complied with his proposition. As to the appellants there was, at the time they paid their money, no outstanding contract with or sale to Hodgkins by the assignee. Nor is there any analogy between this case and one of liability by a grantee in a voluntary conveyance held void as made in fraud of creditors, for rents and profits from the property.

The appellees cite the case of Raun v. Reynolds, 15 Cal. 460. The history of that case, gathered from the above report, and from 11 Cal. 14, and 18 Cal. 275, and Reynolds v. Harris, 14 Cal. 667, shows that a decree foreclosing two mortgages on land had directed that two different parcels, one covered by one of the mortgages and the other by the other, should be sold together, although one parcel was owned by one mortgagor, and the other by him and another person jointly, as mortga gors, such other person being merely a surety. The property was sold under the decree, at auction, by the sheriff, the two parcels being sold together to the plaintiff. He then sold and assigned the decree, and his rights as purchaser, and the sheriff's certificate of sale, to one Harris. After that the defendants appealed from the decree. The decree was reversed for error in the above directions as to the sale. The time for redemption from the sale having expired without any redemption, Harris obtained possession of the property by a writ of assistance. On an application by the defendants to have the sale set aside and

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