author: Burket, J.

text:
    Wambaugh, Trustee, v. The Northwestern Mutual Line Insurance Co. et al.

      Transfer of property to trustee — For benefit of creditors — Is an assignment — Though maker may be solvent — Form of instrument not material — Probate court jurisdiction and proceedings.

    1. When any person makes a transfer of property, money, rights . or credits to a trustee in trust for the benefit of creditors such transfer constitutes an assignment under Title II, chapter 4 of Part Third, Revised Statutes of this state.
    2. Even though'the maker of such transfer should be fully solvent) still the transfer will be held to be an assignment if it is made to a trustee in trust for the benefit of creditors.
    3. Any instrument which by a transfer of property creates a trust in a trustee for the benefit of creditors, is an assignment, and its form in other respects is not material.
    4. A deed conveying real property to a trustee in trust for the benefit of creditors constitutes an assignment, and such deed or a copy thereof should be filed in the probate court of the county in which the grantor resided at the time of the making of such deed, within ten days after its delivery, and on failure to so file the same, the probate judge should remove the assignee, and appoint a trustee to execute the trust under the direction of the probate court.
    5. In such cases no proceeding is necessary in the court of common pleas to declare such deed to be an assignment, but the legal effect of such deed may be determined by the probate court upon application by the assignor or a creditor, subject to a review upon error in a higher court.
    6. Upon the removal of the assignee named in the deed of assignment, and the appointment of a trustee by the probate court to execute the trust, the legal title to the assigned property will follow such appointment and vest in the trustee, and upon a sale by the trustee, confirmation by the court, and deed of conveyance, the purchaser will take a good title.
    (Decided December 13, 1898.)
    Error to the Circuit Court of Delaware county.
    On the nineteenth day of January, 1897, John W. Jones of Delaware county executed and delivered to James W. Gallant, Stephen O. Thomas and Charles M. Wambaugh his certain deed of that date, conveying to them 480 acres of land in Delaware county in this state, ■ together with certain town property. The deed was upon the trust following as expressed therein:
    “To have and to hold said premises, with all the privileges and appurtenances thereto belonging, to the said James W. Gallant, Stephen C. Thomas and Charles M. Wambaugh, as trustees, their successors and assigns forever. This conveyance being made to the said James W. Gallant, Stephen C. Thomas and Charles M. Wambaugh, as trustees, for the following purposes, to-wit: Said trustees to take immediate possession of said lands, subject to existing leases, to collect all rents, income and profits arising from said lands and tenements, and to sell the same in such lots and parcels as they may deem best, whenever such sales can be made to the advantage and interest of my creditors, and said trustees are authorized and empowered to execute deeds to the purchasers of said lands whenever sales are made by them, with or without covenants of warranty, as they may deem best, and to give such time for the payment of the purchase money to the purchasers thereof as they may think proper, provided said deferred payments are secured by mortgage on the premises sold, and until said lands are so sold said trustees are hereby authorized to rent or lease the same in such manner as they may deem best to secure the- best income therefrom. Said trustees are hereby authorized to pajr all taxes and assessments levied upon said lands and tenements, and to make all necessary and proper repairs thereon, and out of the proceeds arising from the rents and profits and from the sale of said lands and tenements said trustees are hereby authorized and directed to pay and distribute the same, as follows:
    1. To pay all liens upon said premises in the order of their priority.
    2. To pay all my individual creditors as their claims are properly proven to said trustees, making equal distribution among them so that no preference shall be given to one individual creditor over another.
    3. To pay to the creditors of Miller, Jones & Co., the amounts which may be found due to them from me as a member of said firm, making equal distribution among them as their claims may be ascertained and determined.
    ■ 4. Whatever surplus may remain after the payment of all the above claims, in lands or money, said trustees are to transfer or pay over to said John W. Jones, his administrators, executors and assigns. The said trustees are to have a reasonable compensation for their services and expenses in the execution of this trust, the amount to be agreed upon by the parties hereto, or fixed by a court having proper jurisdiction in the premises, and the same to be paid or provided for before distribution or payment is made to my creditors, as herein provided for.
    This conveyance is made at the same time with other deeds for grantor’s lands in Marion and Franklin counties, to the same grantees so as to constitute one trust for said purposes, of all of grantor’s property.”
    A like deed of the same date was executed and delivered by him to the same trustees for 537 acres of land in Marion county, both of which deeds were duly left for record and recorded. While both deeds recite that a deed was also executed and delivered for lands in Franklin county, it appears that the deed for the Franklin county lands was never executed or delivered, and there is nothing to show whether Mr. Jones had any lands in Franklin county or not.
    On the fifteenth day of October, 1897, The Northwestern Mutual Life Insurance Company' filed the following application in the probate court of Delaware county :
    “And now comes The Northwestern Mutual Life Insurance Company, a corporation, and represents to the court that it is a creditor to said John W. Jones; that on or about January 19, 1897, the said John W. Jones, then a resident of Delaware county, Ohio, made, executed an assignment to James W. Gallant, Stephen C. Thomas and Charles M. Wambaugh, as trustees of all of his real estate in trust for the benefit of his creditors, said assignment being made by three deeds, each bearing date January 19, 1897. One of said deeds conveying to said trustees real estate in Delaware county, Ohio, another of said deeds conveying real «state in Marion county, Ohio, and another of said deeds conveying real estate in Franklin county, Ohio. That said deeds of assignment were delivered to said trustees and were filed for record respectively in the recorder’s office of Marion, Delaware and Franklin county, Ohio, for record on or about January 19, 1897. That neither said deeds of assignment nor any copy thereof has been filed in the probate court of Delaware county, Ohio, wherein said John W. Jones resided, at the date of the execution of said assignment, though more than ten (10) days have passed after the execution of the same, and have failed to give bond for more than ten (lOj days after the execution of said deeds of assignment to them.
    Wherefore, The Northwestern Mutual Life Insurance Company, a corporation and a creditor as aforesaid, asks the court to make and enter an order removing said trustees, and to appoint a trustee in their place to administer said trust under the Statutes of Ohio, relating to insolvent debtors.”
    The grantees in said deed filed a demurrer to this application which was overruled and exceptions taken, and thereupon they filed the following answer:
    “And now come the trustees named in the application herein filed, and for their answer herein say, that they admit that The Northwestern Mutual Life Insurance Company is a creditor of the said John W. Jones, but they deny that said John W. Jones executed a deed of assignment on the nineteenth day of January, A. D. 1897, or at any other time, but on the contrary, they say that said John W. Jones made deeds of trusts at the time named for certain lands and tenements for the purpose of paying all his creditors alike without preference or priority, and that they accepted said trust, and have ever since been and are still proceeding to execute said trust under the control and direction of the court of common pleas of Delaware county, Ohio, and they deny all other allegations of said application not herein admitted to be true.”
    The matter was heard in the probate court and the two deeds were introduced in evidence, and the court found that Mr. Jones, at the time of making said deeds, was a resident of Delaware county, that The Northwestern Mutual Life Insurance Company was and is a creditor of Mr. Jones, that neither said deeds nor copies thereof were filed in the probate court of Delaware county within ten days after the execution and delivery of said deeds to said trustees, that the said trustees, being the grantees named in said deeds, did not file in the probate court within ten days after the execution and delivery of said deeds their bond for the faithful discharge of their duties as trustees. And thereupon the probate court rendered judgment in favor of the said application and removed said trustees and appointed a trustee to execute said trust, treating said two deeds as a general assignment of said John W. Jones for the benefit of his creditors, which said trustee accepted the trust and gave bond according to law and entered upon the discharge of his duties. The grantees in said deed excepted to the ruling of the probate court and filed a motion for a new trial, which was overruled, and they also took a bill of exceptions setting out all the evidence that was offered on the hearing, and filed a petition in error in the court of common pleas to reverse the judgment of the probate court.
    The court of common pleas affirmed the judgment of the probate court, and thereupon James W. Gallant and Stephen C. Thomas refused to prosecute the case further. And Charles M. Wambaugh, trustee, filed a petition in error in the circuit court seeking to reverse the judgments of the lower courts, and made said James W. Gallant and Stephen C. Thomas defendants in error. The circuit court affirmed the judgments, and thereupon Mr. Wambaugh as trustee filed a petition in error in this court, still joining said James W. Gallant and Stephen C. Thomas as defendants in error, seeking to reverse the judgments of the courts below.

      Powell c& Minaban and John A. Gone, for plaintiff in error.
    We claim that the jurisdiction of the probate court in such cases depends upon two facts : First, that the debtor is insolvent; and, second, that he has made a voluntary assignment in trust for the benefit of his creditors. Neither of these facts appeared in the pleading’s or evidence offered in this ease. The Northwestern Mutual Life Insurance Company, in support of its application, presented to the probate court the two deeds of trust hereinbefore referred to. This did not give the court jurisdiction in the premises. The probate court is only authorized to act when a regular deed of assignment has been presented to it executed by an insolvent debtor in trust for the benefit of his creditors. ■
    In this application there was no claim made that John W. Jones was insolvent or that this deed of trust was made in contemplation of insolvency or that he undertook to prefer some creditors, or to hinder and delay others. These deeds of trust specifically direct the three trustees to take possession of the property described and to sell the same at public or private sale upon such terms as the trustees may think proper and distribute the proceeds in the manner provided for in the deeds.
    It is not within the power of the probate court to change the character of these instruments. That can only be done by the court of common pleas. It can only be done by petition filed charging that the instruments were fraudulent as to creditors and having them declared to be deeds of assignment for the benefit of all creditors alike.
    These deeds were drafted after forms which have been approved by this court in several cases, especially in the cases of Hoffman et al. v. Mackell et al., 5 Ohio St., 124; Conklin et al. v. Coonrod & Crum, 6 Ohio St., 612; Floyd et al. v. Smith, 9 Ohio St., 546.
    The probate court would have power under these sections (6343, 6344) to appoint a trustee only after a court of competent jurisdiction had declared the instruments to be void as fraudulent against creditors. Spoors v. Coen, 44 Ohio St., 497.

      Sayler <& Sayler; J. D. Van Deman and Wolford c& Crissinger, for defendants in error.
    In order to fully comprehend the force and effect of the present statutes of Ohio relating to assignments for the benefit of creditors, as contained in chapter 4 section 6335, etc., Revised Statutes, of Ohio, it will be profitable to review the history of the assignment laws of Ohio.
    Prior to the act of April 6, 1859 (56 Yol. Statutes, 231; 4 Curwen’s Statutes, 3352), there was no general act regulating the mode of administering assignments in trust for the benefit of creditors in Ohio. Under the constitution of 1802, and at the time when there was no probate court existing in Ohio, the legislature passed laws directing the mode of proceeding in chancery. One of the early acts thus passed was that of February 23, 1835, found in 1 Curwen’s Revised Statutes, of Ohio, 161; 1 Swan & Critchfield, 712, and note.
    That act was supplanted in 1838 by section 3, found in 1 Curwen’s Statutes, 424.

      After the adoption of the constitution, of 1851 the legislature passed an act on March 14, 1853; 3 Curwen’s Statutes, 2239; Mitchell v. Gazzam, 12 Ohio, 336.
    The only difference between the act of 1853 and the acts of 1835 and 1838 is the fact that the act of 1853 drops out the reference to the court of chancery, and places the jurisdiction “ subject to the control of the courts.” In 1853, therefore, the cqmmon pleas court took jurisdiction under that section of the act, the probate court not having jurisdiction over assignment matters.
    On April 6, .1859, the legislature passed an act regulating the mode of administering assignments in trust for the benefit of creditors, 56 Vol. Statutes, 231; 4 Curwen’s Statutes, 3352; 3 Am., and Eng. Ency. Law, 2d Ed., p. 5; Law Reports, Appeal Cases, 1894; s. c. 6 Rep., 6; Mayer et al. v. Heilman, 91 U. S., 496; Schroder v. Tompkins et al., 58 Fed. Rep., 672; Johnson v. Sharp, 31 Ohio St., 611; see note in 3 Curwen’s Statutes, 2239.
    That the probate court now has complete jurisdiction under chapter 4 of title 2, sections 6332 et seq., Revised Statutes there can be no doubt. It is no longer an open question in Ohio. This jurisdiction in the probate court is exclusive of all other courts, except as is provided in section 6344 and also, except under section 6351, Revised Statutes (amended in 93 Ohio L., 132). See also for jurisdiction of probate court section 6335 Revised Statutes.
    Under section 6336 the probate court acquires jurisdiction to compel an assignee to file the assignment, etc.
    This act is a special act made especially applicable to assignments for creditors, and being a special act it becomes exclusive and deprives all other courts of jurisdiction of such deeds, and therefore outsets the common pleas court from the jurisdiction which it had of assignment matters prior to the act of April 6, 1859 (4 Curwen, 3352). Betz v. Snyder, 48 Ohio St., 492; Lindeman v. Ingham, 36 Ohio St., 1; Blandy v. Benedict, 42 Ohio St., 295; Sayler v. Simpson, 45 Ohio St., 141; Clapp et al. v. Banking Co. et al., 50 Ohio St., 528; McNeill, Assig. v. Hagerty, Auditor, 51 Ohio St., 255; Havens et al. v. Horton, Jr., 56 Ohio St., 342.
    ' Under the common law, and in general, any person of sound mind, not under a legal disability, may make an assignment for the benefit of creditors. 3 Am. & Eng. Enc. of Law, 2d ed., section 4, page 22. Brown & Ives v. Mintern et al., 2 Gallison’s Rep., 556; Brashear v. West, 7 Peters, (S. C.), 608. .
    The general rule as laid down in 3d Am. & Eng. Enc. of Law, 2d ed. section 31, is that ‘ ‘ the debtors actual of contemplated insolvency is not’ essential to a valid assignment, unless made so by statute.” A person wholly-solvent could under the common law, if he desire, make a valid general assignment for the benefit of his creditors without preference of priority, and therein direct that any surplus that may be left after paying all the debts and expenses shall be returned to him. Ogden v. Peters, 21 N. Y., 23; s. c. 78 Am. Decisions, 122; Ely v. Cook, 18 Barb., N. Y., 612; Angell v. Rosenbury, 12 Mich., 241; Morgenthan v. Harris, 12 Cal., 245; Quinebaugh Bank v. Brewster, 30 Conn., 559; Hunter v. Ferguson, 3 Col. (Ct. of App.), 287; Jaffrey et al. v. Matthews et al., 120 Mo., 317; sections 6335 and 6343 Revised Statutes. Tiere is no limitation in the statute as to the person, and there is no limitation as to his financial condition. Section 6343 has substantially existed in Ohio since its first enactment on February 23, 1835. 1 Curwen; 161.
    It was intended to take away the right which an insolvent person had at common law to prefer creditors by executing deeds of trusts to trustees. Hill v. Jeffrey et al., 8 Ohio, 390; Atkinson et al. v. Tomlinson et al., 1 Ohio St., 237.
    We contend that any person in Ohio, whether solvent or insolvent, can make a valid general assignment for the benefit of his creditors.
    As to the form of the instrument by which an assignment is made : Lee et al. v. Hennick et al., 52 Ohio St., 177. In other states it has also been held that no particular form is necessary. Weber v. Mick, 131 Ill., 520; Farwell v. Cohen, 138 Ill., 216; Schuylkill Bk. v. Reigail, 4 Pa. St., 477; Hall v. Marston, 17 Mass., 575.
    The statutes of Ohio relating to voluntary assignments do not define the word “assignment.” The legislature found general assignments for benefit of creditors in common use, and provided a mode by which the trusts should be enforced. 3 Am. & Eng. Enc. of Law, 2d ed., pp. 6, 7, 8 and 9, and also p. 57. Strong v. Kalk, 91 Wisc., 29; Cribb v. Hibbard, 77 Wisc., 208; Wolf v. Muldrow, (Ark. 1892); s. c. 18 S. W. Rep., 66, following Penzel Co. v. Jett, 54 Ark., 428; Peck v. Merrill, 26 Vt., 686; Dias v. Bouchard, 10 Paige Ch., 461; Blockburne’s Appeals, 39 Pa., 165.
    The word assignment in section 6335 is equivalent to the words, deed, conveyance, transfer. It means any instrument in writing by which the title to real or personal property can be conveyed or transferred.

      Similar remarks apply to section 6344, Revised Statutes. In short, sections 6343 and 6344 merely bring under the head of general assignments for benefit of all creditors, certain specific conveyances which otherwise would not be general assignments. Brinkerhoff, trustee, v. Smith et al., 57 Ohio St., 610; Brinkerhoff, trustee, etc., et al. v. Tracey, Adm’r, 55 Ohio St., 558.
    See, also, the following cases in Ohio as to what have been held to be assignments for the benefit of creditors. Gashe v. Young, 51 Ohio St., 376; Maas v. Miller, et al., 58 Ohio St., 483; Bloom v. Noggle et al., 4 Ohio St., 45; Harkrader et al. v. Leiby et al., 4 Ohio St., 602; Dickson et al. v. Rawson et al., 5 Ohio St., 218; Brown & Co. v. Webb, 20 Ohio, 389.
    Most of the above cases arose under section 6343 or section 6344, but, as shown above, that fact makes no difference as to the general principles underlying voluntary assignments for creditors.
    If these deeds in case at bar are in effect deeds of assignment, then as it is admitted that the trustees did not within ten days after the delivery of the said deeds of assignment to them, appear before the probate judge of the county in which the assignor resided at the time of executing the same, etc., as required under section 6335, that the probate court had full authority under section 6336, at the application of any creditor, to make an order removing such trustees and appoint a trustee in their place.
    The probate court having thus the full power to remove the assignee or trustee, there can be no appeal from such order or judgment of removal; for the reason that the order does not affect any property or substantial right, but merely the administration of the trust. Brigel v. Starbuck, 34 Ohio St., 280; Aultman v. Seiberling Co., 31 Ohio St., 201; In re Estate of Still, deceased, 15 Ohio St., 484.
    If the trustee or assignee so removed can not appeal, can he then prosecute error to such order of removal? We maintain that he can not, for the reason that the order so removing is not a final order, and no reversal can be had of an order that is not final.
   Burket, J.

It is conceded by all parties that the conveyances made by John W. Jones to James W. Gallant, Steven C. Thomas and Charles M. Wambaugh, are in legal effect conveyances of property to trustees in trust for the benefit of creditors.

It is also conceded that the Northwestern Mutual Life Insurance Company, defendant in error, was at the date of said conveyance, and still is, a creditor of said John W. Jones.

The insurance company claims that the conveyances are in legal effect an assignment to trustees for the benefit of creditors, while the plaintiff in error claims that the conveyances do not constitute such an assignment.

All conveyances made to a trustee in contemplation of insolvency, or made with intent to hinder, delay or defraud creditors, are assignments under the provisions of sections 6343 and 6344, Revised Statutes, as they stood before the amendment of April 26, 1898, and are to be administered as such. A conveyance in trust may therefore be an assignment when made in contemplation of insolvency. Can it be an assignment when not made in contemplation of insolvency?

While sections 6343 and 6344 provide that conveyances made in contemplation of insolvency with intent to prefer one or more creditors, or made with intent to hinder, delay or defraud creditors, shall be held to be general assignments, and shall inure to the equal benefit of all creditors, these sections do not provide what shall constitute an assignment when not made in contemplation of insolvency, and not with the wrongful intent mentioned in said sections; and we have no statute in this state defining what shall constitute a general assignment for the benefit of creditors. The statutes on the subject of such assignments assume that it is known what constitutes an assignment for the benefit of creditors, and treat the subject from that standpoint. Whatever constitutes an assignment for the benefit of creditors at common law, will be held to be an assignment under our statutes, and in some respects our statutes are broader than the common law, but never narrower.

At common law any person of sound mind could make an assignment of his property to a trustee for the benefit of his creditors. 3 Am. & Eng. Enc. Law., 2d ed., 22.

And such assignment could be made at common law by a person fully solvent. Hunter v. Ferguson, 3 Col. Appeals, 287; Ogden v. Peters, 21 N. Y., 23; Angell v. Rosenbury, 12 Mich., 241; Wolf v. Mudldrow, 18 S. W. Reporter, 55; Penzel Company v. Jett, 54 Ark., 428.

The form of the instrument making the conveyance is not material. Any instrument which transfers the property to a trustee in trust for the benefit of creditors, constitutes an assignment at common law. In such cases the conveyance is in trúst for the benefit of others, and such trust characterizes the transaction as an assignment, rather than as a simple conveyance. It has been held that the form of the instrument is immaterial when the conveyance is made in contemplation of insolvency, and we hold the same to be true when the conveyance is made by a person fully solvent. Lee v. Hennick, 52 Ohio St., 177, 182.

The deeds in question in this case conveyed the property to trustees in trust for the benefit of creditors and therefore, in legal effect, they constitute an assignment, even though Mr. Jones may have been fully solvent at the time of the making and delivering of the deeds. Whether he was then solvent or not does not fully appear in the record, but for the purposes of this case he is regarded as solvent.

A.s said deeds in legal effect constitute an assignment, it is clear that under section 6335, Revised Statutes, it was the duty of the trustees to file the deeds, or copies thereof, in the probate court of Delaware county, where Mr. Jones resided, within ten days, as required by that section of the statute, which reads as follows :

“When any person, partnership, association or corporation, shall make an assignment to a trustee of any property, money, rights or credits, in trust for the benefit of creditors, it shall be the duty of said assignee, within ten days after the delivery of the assignment to him, and before disposing of any property so assigned to appear before the probate judge of the county in which the assignor resided at the time of executing the said assignment, produce the original assignment, or a copy thereof, cause the same to be filed in the probate court, and enter into a bond, payable to the state, in such sum and with such sureties as shall be approved by the court, conditioned for the faithful performance, by said assignee, of his duties according to law; and the court may require the assignee, or any trustee subsequently appointed, to execute an additional undertaking whenever the interests of the creditors of the assignor demand the same; any such assignment shall take effect only from the time of its delivery to the probate judge, and the exact time of such delivery shall be indorsed thereon by the probate judge, who shall immediately note the filing on the journal of the court; and it may be delivered by the assignor to the probate judge either before or after its delivery to the assignee. ’ ’

The public policy established by this section regards a man who places his property into the hands of a trustee for the benefit of. his creditors, and thereby deprives himself of the power of using his property for that purpose, the same as dead as to such property, and the trust a public one in which the state is interested, because the state is always interested to see that creditors receive their just dues. Therefore, the state requires that such a trust shall be administered, under the direction of its courts, and bonds are required of the trustee for the faithful performance of his duties as such trustee, that is for the faithful administration of the trust. The trustees in this case, having failed for more than ten days to file the said deeds, or copies thereof, in the probate court, it became the duty of that court to remove said trustees and appoint others as provided in section 6336, Revised Statutes, which reads as follows:

“If any such assignment or a copy thereof shall, for ten days after the execution of the assignment, not be filed in the probate court as aforesaid, or if the assignee named thereon fail for that time to give bond as aforesaid, the court shall, on the application of the assignor, or of any of his creditors, make an order removing such assignee and appoint a trustee in his place: provided, that if more than one assignee be named in the assignment, and some of them fail as aforesaid, the court may permit the assignee or assignee's complying with the preceding section to qualify and enter upon the discharge of the duties of the trust.”

The deeds were not m ade in contemplation of insolvency, with intent to prefer one or more creditors, nor with intent to hinder, delay or defraud creditors, and therefore no action is required in the court of common pleas as provided in section 6344, Revised Statutes, as it stood before the amendment of April 26, 1898. The object of the action provided for in that section is to set aside a fraudulent conveyance and ascertain the trust, and declare it ■to inure to the equal benefit of all creditors. Here the deeds themselves declare the trust to be for the equal benefit of all creditors, and there is no action necessary to establish that which the deeds have already established. The effort here is not to set aside a conveyance, but to have the conveyance executed according to its terms, and administered under the orders and supervision of the probate court. All parties concede the deeds to be valid, and the only controversy is as to the manner of executing the trust thereby created.

Before the passage of the act of April 6, 1859, entitled “An act to regulate the mode of administering’ assignments in trust for the benefit of creditors,” 56 Ohio Laws, 231., S. & C., 709, such trusts were administered in the court of common pleas, which might under former statutes require security of the trustees for the faithful execution of the trust, or remove them and appoint others as justice might require. See act of March 14, 1853 51 Ohio Laws, 463, S. & C., 712, Note.

By the act of April 6, 1859, the jurisdiction in matters of assignment was vested exclusively in the probate court, where it has ever since remained and now the court of common pleas has no jurisdiction in matters of assignments, except as provided in sections 6344 and 6351, Revised Statutes, and therefore the cases of Hoffman v. Mackall, 5 Ohio St., 124 ; Conkling v. Coonrod, 6 Ohio St., 612, and Floyd v. Smith, 9 Ohio St., 546, are not applicable here, because they all arose and were decided before the probate court obtained jurisdiction of assignment matters, and while such jurisdiction was exercised by the court of common pleas.

The deeds in the above cases of Hoffman v. Mackall, and Conklin v. Coonrod, were very much like the deeds in the case at bar, and they were treated as assignments by the parties and by the court, and the effort in those cases was to set aside the conveyances as fraudulent, and not to execute the conveyances as is the case here. The conveyances in both cases were upheld as valid and no question was made as to the manner of administering the trust, as it had then to be administered in the court of common pleas, the probate court not yet having acquired jurisdiction.

The above case of Floyd v. Smith, was an action by Mr. Smith, to whom a transfer of personal property" had been made-in trust, against the sheriff who had taken the property in execution in a suit against the assignor, the sheriff claiming the transfer to be fraudulent and void. The question was as to the validity of the transfer, and the transfer was sustained. No question was made as to the manner of executing the trust.

For the reason that the probate court had not then acquired jurisdiction, and the further reason that the questions presented and decided were entirely different from the questions in this case, those cases are not applicable here, and throw no light upon the questions involved in this case.

< All assignments, or copies thereof, are required by section 6335, to be filed in the probate court, and it has been urged that before such filing can be legally required, there must be an adjudication in the court of common pleas to the effect that the deeds in question constitute an assignment. That adjudication is not necessary and is not required by any provision . of the statute. The probate court having jurisdiction in matters of assignment, can determine that question itself upon the application of the assignor or a creditor, subject to a review on error in the higher courts as was done in this case.

It is contended by counsel for plaintiff in error that the deeds of conveyance vested the title to the lands in the trustees, and that their removal and the appointment of a trustee by the probate court cannot have the effect to vest title in such trustee, and that a purchaser from such trustee would not take a good title. This contention is not sound. It was said in McNeill v. Hagrty, Auditor, 51 Ohio St., 255, 263, that in such cases the legal title follows the order of the court and vests in the trustee appointed by the probate court. In this case the title vested in the trustees under the deed in trust for the creditors, and such trust is under the jurisdiction and control of the probate court, and certainly the removal of the trustee by the order of the probate court, and the appointment of another trustee has the legal effect, when a sale is made and confirmed by the court, and deed executed and delivered by the new trustee, to divest the legal title out of the original trustees, and vest the same in the purchaser as a good and indefeasible title. Such being the case, the purchaser will take a good title.

A persistent effort has been made by counsel for the insurance company to have this case disposed of on technical points of practice, without reaching the merits of the controversy between the parties, but we regard the points raised as not well taken, and have considered the case on its merits.

Judgment affirmed.


source: Caselaw Access Project

author: Bradbury, J.

license: Public Domain

text:
    Ohio Farmers Insurance Co. v. Hard, Treas.

      Authority of county auditors to revise and correct tax returns— Applies to certain corporations — Continuation and extent of authority — Definition of‘fatse returns" — Sections 2744 and 2781, Revised Statutes.

    1. Section 2744, Revised Statutes, confers on county auditors authority to revise and correct the tax returns of such corporations as under its provisions must make their returns directly to him. Domestic fire insurance companies belong to this class. The authority thus conferred continues throughout the current year, or until the taxes on the property so returned have been paid, but does not extend to returns made for former years.
    2. Section 2781, Revised Statutes, confers on the several county auditors of the state the same jurisdiction over the tax returns made by such corporations for the five preceding years that it confers on them in respect to the returns made by natural persons during that period.
    3. A willful undervaluation of property returned for taxation is alone sufficient to constitute a “false return” within the meaning of that term as found in section 2781, Revised Statutes.
    (Decided December 13, 1898.)
    Error to the Circuit Court of Medina county.
    This action was brought by the plaintiff in error to restrain the defendant in error from collecting certain taxes which had been assessed ag’ainst it by the auditor of Medina county under the provisions of section 2781, Revised Statutes. The facts necessary to an understanding of the decision will be found in the opinion of the court.

      Lee Elliott; G. W. Lewis; J. And/rew and Boynton di Horr, for plaintiff in error.

      J. If. Jones; J. M. Henderson and Frank Spell-man, for defendant in error.
   Bradbury, J.

The questions to be determined arise on the pleadings. The plaintiff in error was plaintiff below and interposed in the court of common pleas a demurrer to the answer to the amended petition. The court of common pleas sustained the demurrer on the ground that the answer contained no defense to the action, and rendered a judgment perpetually restraining the treasurer from collecting the taxes complained of. This judgment the circuit court reversed, and thereupon the cause was brought into this court to reverse the judgment of the circuit court and to reinstate that of the court of common pleas.

The first question that confronts us relates to the particular action of the county auditor of which complaint is made. Was it such as the law authorized or not ? To determine this it is necessary to learn what his action was. Did he add to the returns made by the plaintiff in error certain property omitted from those returns, or, being satisfied that all of its taxable property had been returned, but at too low a valuation, did he simply increase that valuation ? Or did he both add omitted property and also increase the valuation of that which had been returned, and when did he act? The amended petition discloses that the county auditor on the ninth day of April, 1892, added to the returns made by plaintiff in error for the years, 1886, 1887, 1888, 1889,1890 and 1891, including a penalty of fifty per cent., the following amounts :

For the year 1886, $938,972.00; for the year 1887, $1,005,111.00; for the year 1888, $1,136,866.00; for the year 1889, $1,151,779.00; for the year 1890, $1,235,468.00; for the year 1891, $524,318.00; and that the taxes resulting from these additions aggregated $60,490.04. The validity of the greater part of this addition depends upon the power or jurisdiction of the county auditor to proceed under section 2781, Revised Statutes. The specific acts of the county auditor upon which these additions rest, do not clearly appear in the record. The amended petition, however, states in respect to this matter as follows :

“The plaintiff further says that the real estate with the improvements thereon and all the moneys, credits, and movable propertj7- of. this plaintiff added thereto were duly listed for taxation as required by section 2744 of the Revised Statutes, and the return thereof made to the auditor of the county for the years 1886, 1887, 1888, 1889, 1890, and 1891, and was in said year 1886, duly valued for ^taxation at $880,864.00, and for the year 1887 said property, moneys, and credits were valued for taxation at $930,861.00, and for the year 1888 at $932,186.67, and for the year 1889 at $1,010,171.08, and for the year 1890 at $1,066,444.92, and for the year 1891 at $1,118,198.30.

The said valuations so fixed for said respective years was the fair and full valuation of said property; and taxes for each of said years were duly assessed thereon for state, county, township, and school purposes, and which the plaintiff has fully paid for each and all of said years. ”

These averments clearly state two things: first, that the plaintiff in error returned to the auditor for the years named all its property; and, second, that it fixed upon such property a full and fair valuation. By reference to tb e answer to the amend ed petition the following paragraph is found:

‘ iAnd said defendant says, that the valuations fixed and returned by said plaintiff for said respective years were not fair and full valuations of said property for the reason that all the credits owned and held by said plaintiff were returnable at their full face value and in like manner all money held by said plaintiff were returnable for the full amount so held, and this defendant says that said plaintiff did not return to exceed 50 to 66 per centum of its credits, moneys, and investments in stock and bonds; that under the law it was required to list all such personal property as above mentioned at its full 100 per centum valuation. ”

The answer contains no other matter that bears materially on this question. We think a fair and reasonable construction of the amended petition and answer to it shows that the plaintiff in error had in fact returned to the county auditor for taxation all its property, but that in the opinion of that officer it was valued too low and that the addition he made to the returns of piaintiff in error for the years mentioned simply increased that valuation, without bringing any other property whatever on the tax list.

Plaintiff in error contends that the only authority granted to county auditors to correct tax returns made by corporations of its class is found in section 2744, Revised Statutes. That section in as far as concerns the question before us reads as follows:

“The president, secretary, and principal accounting officer of every * * * insurance company, telegraph company, or other joint stock company, except banking or other corporations whose taxation is specifically provided for * * * shall list for taxation, verified by the oath of the person so listing, all the personal property, which shall be held to include all such real estate as is necessary to the daily operations of the company, moneys and credits of such company or corporation within the state, at the actual value in money, in manner following: In all cases return shall be made to the several auditors of the respective counties where such property made be situated. * * * If the county auditor to whom returns are made is of the opinion that false or incorrect valuations have been made, or that the property of the corporation or association has not been listed at its full value, or that it has not been listed in the location where it properly belongs, or in cases where no return has been made to the county auditor, he is hereby required to proceed to have the same valued and assessed; provided, that nothing in this section shall be so construed as to tax any stock or interest in any joint stock company held by the state.”

The plaintiff in error is an insurance company, created under the laws of this state, and therefore, falls within the class required to make its tax returns un'der the above section (2744). That section clothes a county auditor with general power to correct among other matters any undervaluation of property found by him in returns for taxation made by such corporations under its provisions. The section does not prescribe any period of time within which the correction must be made, but doubtless the authority of a county auditor for that purpose continues during the current year, but as that section contains no language extending its operation beyond the current year, his authority to act under it should be confined to the taxes of the current year. Because of this authority vested in a county auditor under section 2744, supra, defendants in error contend that even if it should he conceded that the county auditor in case under consideration has no jurisdiction over plaintiff in error under section 2781, Revised Statutes, nevertheless, as he in this instance had before him and passed upon, among earlier returns, the return for the current year (i. e., the year during which his action was had) and increased the valuation of the plaintiff in error’s property for that year, and as the answer set forth among other matters this action of the auditor, it disclosed a valid defense to this extent, and the demurrer to it should have been overruled. As to this claim, it should be said that the action of the auditor was had on-April 9, 1892. He had before him the tax returns made by the plaintiff in error for the years 1886, 1887, 1888, 1889, 1890 and 1891. Section 2744 does not expressly prescribe any particular period of time within which a corporation therein mentioned shall make its return to a county auditor. In this respect it is doubtless governed by the provisions of section 2747, Revised Statutes, which requires, generally, that returns shall be made between the second Monday of April and the third Monday of May annually, but as the provisions of section 2744, Revised Statutes, requires county auditors, on or before the first Monday of May annually, to furnish blanks to corporations of this class to which plaintiff in error belongs, on which to make their returns, it follows that the period within which such returns should be made for 1892, if begun, had not expired, at the time action complained of was had by the auditor, April 9, 1892, nor had the last half of the taxes for 1891 become due. Therefore in respect of the taxes of 1891, the current year had not expired, so that any question relating to the valuation of 1891 concerned the taxes for the current year and therefore the county auditor had jurisdiction thereof by virtue of section 2744, Revised Statutes, and it necessarily follows that additions made by him for that year were prima facie valid and that an answer setting forth such additions disclosed a defense pro tanto which could not be successfully attacked by a general demurrer. As the court of common pleas sustained a demurrer to this answer, and the circuit court reversed the judgment, the foregoing considerations are, alone, sufficient to sustain the action of the circuit court.

The plaintiff in error seeks to restrain the county treasurer from collecting the sum of $60, - 490.04, on the ground that the county auditor had, without authority of law, added that amount to the taxes legally assessable against it. Only a small fraction of this sum could have been lawfully imposed by the county auditor under the power which we have seen is conferred on him by section 2744, Revised Statutes. So that the balance, probably exceeding $55,000 of the above sum added by him, depends for its validity on his authority to -act under section 2781, Revised Statutes. If he was not authorized by that section to make the additions, then plaintiff in error is entitled to relief against the imposition of this large balance. It becomes necessary, therefore, to ascertain the authority vested by this section (2781) in countjr auditors over the tax returns of the corporations of the class to which plaintiff in error belongs. It is true not only that a county auditor under section 2744, Revised Statutes, may increase the valuation placed upon its property by a corporation of this class, but that the annual boards of equalization may also pass upon that, question under section 2804, Revised Statutes. The authority granted by the first of these sections to the county auditor and that conferred by the other on annual boards of equalization relate however only to returns for the current year. The remedy against individuals for false returns made by them in preceding years is provided by section 2781. If one exists against corporations of the class to which plaintiff in error belongs, for false returns made by them in preceding years, it must also be found in this section (2781) for none is provided under any other statute. This section reads as follows :

“If any person whose duty it is to list property or make a return thereof for taxation, either to the assessor or county auditor, shall in any year or years make a false return or statement, or shall evade making a return or statement, the county auditor shall for each year, ascertain as near as practicable, the true amount of personal property, moneys, credits and investments that such persons ought to have returned or listed for not exceeding the five years next prior to the year in which the inquiries and corrections provided for in this and the next section are made; and to the amount so ascertained as omitted, for each year he shall add fifty per centum, multiply the omitted sum or sums and (as) increased by said penalty by the rate of taxation belonging to said year or years, and accordingly enter the same on the tax lists in his office, giving a certificate therefor to the county treasurer who shall collect the same as other taxes. ”

The language is “if any person” * * * shall make “a false return or statement.” * * * These words “any person,” plaintiff in error contends, do not include a corporation, but refer exclusively to natural persons. If notwithstanding the object sought by our statutes that relate to listing property for taxation and the correction of errors in connection therewith any serious doubt should arise as to whether this language “any persons” applied to artificial as well as natural persons or companies, it would be laid at rest by reference to section 2730, Revised Statutes. This last section is the first section found under Title XIII, to which .title section 2781 also belongs. This section (2730) expressly declares that in this title that “words importing the masculine gender shall apply to females also, and the word ‘person’or ‘party’ * * * shall be held to include firms, companies, associations, and corporations.”

We hold, therefore, that section 2781, Revised Statutes, confers upon county auditors the same jurisdiction over the returns of corporations of the class to which plaintiff belongs that it confers over the returns of individuals. The case of Miller, Treasurer, v. Bank, 46 Ohio St., page 424, does not conflict with this view. That case relates to tax returns made by banking institutions for which provision is made by section 2761, Revised Statutes, the terms of which widely differ from those of 2744, and are sufficient in themselves to confer on county auditors ample authority for dealing with the entire subject. If under section 2781, supra, the county auditor had jurisdiction over the returns of the plaintiff in error for the five preceding years, is the fact alone that the corporate property had been returned at too low a valuation sufficient to authorize the imposition of the penalty provided by that section? That is, can an undervaluation be made the predicate of a “false return?” The words of the statute, in as far as they bear upon this question, are as follows:

“If any person whose duty it is to list property or make a return thereof for taxation, either to the assessor or county auditor, shall in any year or years make a false return or statement or shall evade making- a return or statement, the county auditor shall for each year, ascertain as near as practicable, the true amount of personal property, moneys, credits and investments that such person ought to have returned or listed for not exceeding the five years next prior to the year in in which the inquiries and corrections provided for in this and the next section are made.”

There was no attempt made by the plaintiff in error during- any of the years covered by this controversy to evade making a return. Nor does it appear that any of its property was omitted from the returns it in fact made. In this respect its returns could not have been false. If false at all, within the meaning of the statute, it was because the property returned was undervalued. The object of the statute is to distribute the burden of taxation as equally as practicable. A severe penalty is inflicted extending backwards for a period of five years for returns falsely made. Doubtless the purpose of this is not so much to recover a penalty as to secure fair and honest returns of property subject to taxation, and thus impose the burden of supporting the government equally upon all property. It is quite possible however that this burden can be as readily cast off by willfully and knowingly undervaluing property as by concealing its existence. Doubtless when an owner in fact returns for taxation all his property much latitude must be allowed for honest differences of opinion, as to its value. According’ to the doctrine announced by this court in Ratterman, Treasurer, v. Ingalls, 48 Ohio St., 468, to constitute a “ false return” within the meaning of section 2781, supraf ‘ ‘ there must appear if not a design to mislead or deceive on the part of the taxpayer, at least culpable negligence. ’ ’

In this connection it is appropriate to say that where one has returned all his property, for taxation but is charged with undervaluing it, it should be remembered by those charged with the duty of determining’ it to be false or not within the meaning of this section (2781), that the matter is not only one about which honest differences may arise, but that the valuation placed upon the property by its owner is by virtue of other statutory provisions subject to revision by the auditor and annual boards of equalization. However notwithstanding these considerations, that may intervene and render the duties of a county auditor in this regard both delicate and difficult, we think a willful undervaluation placed by an owner on property returned by him for taxation, when fairly established should beheld to constitute a “false return” within the meaning of section 27.81, Revised Statutes, but that a mistake, not “culpable” in respect of its value would not constitute such “false return.”

Judgment affirmed.


author: Spear, C. J.

text:
    Coe v. Erb et al.

      Lien of judgment attaching to lands — Section 6S7S, Revised Statutes —Entry of judgment must be made during term — Entry by clerk after adjournment of term by procurement of counsel not effective.,
    1. In order to create a judgment lien upon the lands of the udgment debtor, as of the first day of the term at which a „udgment against such debtor is rendered, under favor of section 5375, Revised Statutes, the judgment must not only be pronounced during the term, but an entry of such judgment must be made on the journal during the term.
    2. An entry of judgment on the journal, made in the case by the clerk, by procurement of the counsel for the plaintiff, after the adjournment of the term and in vacation, purporting to have been made at a date during the term, will not, as against the rights of a bona fide purchaser of such lands during the term, have the effect of creating a lien on the lands of the judgment debtor as of the first day of the term, although a judgment was in fact pronounced during the term.
    3. In an action brought by such judgment creditor against the purchaser to subject the lands so purchased to the payment of the judgment, the purchaser may contest, by pleading and proof, the lien sought to be enforced against the land.
    (Decided December 13, 1898.)
    Error to the Circuit Court of Franklin county.
    The defendant in error, D. S. Erb, commenced an action in the court of common pleas against one Hendrickson and others, including the plaintiff in error, Irvin T. Coe. His petition set forth that on the nineteenth of March, 1894, he recovered a judgment against Hendrickson in that court in an action which was pending’ on and before the first day . of the January term, 1894, for $311.29, and costs, which is wholly unpaid and unsatisfied; that from December 31, 1893, and prior to the first day of the January, 1894, term of the court, and that from before, at and continuously after the said first day of said term, until March 19, 1894, the defendant, Hendrickson, was the owner in fee simple of lots 21 and 22 in Dennison Place Addition to the city of Columbus, on which' the judgment from the first day of the January, 1894, term of court, became a lien and now is a lien; that since the rendition of the judgment Hendrickson has not had, nor has he now, any real or personal property whatever, and that on or about March 17, 1894, he conveyed said lots to the defendant, Irvin T. Coe, who now holds the legal title. Other defendants claim an interest in the property. The plaintiff asked that defendants set up any claim of title they have, or be forever barred; that the lands be sold and plaintiff’s judgment and all costs be paid in full from the proceeds.
    Coe answered, denying that the judgment was a lien as of the first day of the January term, 1894, or that it was such lien on the nineteenth of March, 1894, and alleging that the property was conveyed to him by Hendrickson, for a fair and valuable consideration, March 17, 1894, at which time he took possession. The action referred to was upon an account for goods sold and delivered.- It was pending at the January term, 1894, but the pendency' thereof was wholly unknown to this defendant until long after the purchase and conveyance of the land; that at no time during’ the term, which commenced on the-day of January, 1894, and ended on the thirty-first day of March, 1894, was there spread upon the journals of the court any judgment or finding of the court in respect to the case, nor was there any entry filed in court, and defendant had no notice or knowledge whatever until after the purchase and conveyance, of the rendition of the judgment. On or about the fourth day of April, 1894, a journal entry was prepared by counsel for plaintiff, setting forth a finding and judgment in said suit and the same was then entered upon the journal of the court as of the twenty-ninth day of March, 1894, all of which facts were wholly unknown and unsuspected by the defendant until long after said term, and said judgment, so entered as aforesaid, is the judgment set up in plaintiff’s petition.
    A demurrer to this answer was sustained. The court thereupon found the issues for the plaintiff, and that by reason of the judgment pleaded in the petition, he has a valid lien upon the real estate for the amount of his judgment and costs, and ordered the land sold to satisfy the same. On error the circuit court affirmed this judgment, and to reverse both judgments this proceeding in error is brought.

      J. S. Friesner and Q. F. Castle, for plaintiff in error.

      Thos. E. Steele, for defendant in error.
   Spear, C. J.

The question argued by counsel for plaintiff in error, as arising upon the record, is, whether or not, in an action commenced prior to the beginning of the term, upon a claim for money, a judgment announced though not placed upon the journal during the term but entered nunc pro tuno after the term, creates a lien upon, the real estate of the judgment debtor, as against a bona fide purchaser who buys during the term but before the judgment is announced, without knowledge of the pendency of the action.

The question thus made involves a consideration of the statute which deal with the essentials of a judgment and with its effect upon the real property of the judgment debtor. Section 5374, Revised Statutes, provides that lands and tenements, and goods and chattels not exempt, “shall be subject to the payment of debts and shall be liable to be taken on execution and sold. ’ ’ Section 5375 provides that: “Such lands and tenements, within the county where the judgment is entered, shall be bound for the satisfaction thereof from the first day of the term at which judgment is rendered ; but judgments by confession and judgments rendered at the same term at which the action is commenced, shall bind such lands only from the day on which such judgments are rendered.” It has sometimes been contended, and the rationale of the judgments of the courts below in this case appears to imply, that the actual entry of the judgment upon the journal is not essential to the creation of a lien. This implication, it seems to us, is not warranted, when all the sections bearing upon the subject are regarded and their evident purpose considered. It is true that the two words “rendered” and “entered,” in their strict use, bear a clear difference in meaning and intent. Giving to these words such signification, a judgment may be ‘said to be “rendered” by a declaration from the bench; but to enter it requires the act of the clerk in writing it upon the journal. It is true, also, that for some purposes a judgment may be regarded as rendered so soon as it is pronounced. But, having in mind that we are dealing with the creation of liens upon real estate, the question is in what sense is the word “rendered” used in the statute? Section 5331 provides that: “All judgments * * * shall be entered on the journals of the court. ’ ’ Why this requirement if the judgment is to be regarded as in full force and effect for all purposes by the mere announcement of it from the bench ? It would not be questioned, we suppose, that execution may not properly issue on a, judgment until it has been duly entered. From this it would follow that goods and chattels even cannot be seized in execution upon the mere announcement of judgment by the court, and to assume that lands and tenements may be burdened by a lien, good for every purpose except sale, by judicial acts of less formality than are necessary to subject goods and chattels to the payment of the debt, would be an anomaly in the law in view of the fact that when execution issues it must be first satisfied by levy and sale of goods and chattels, if any are found not exempt, and the money can be made out of lands and tenements only for want ■of goods and chattels. The requirement that all judgments must be entered on the journal carries the implication that until that is done the judgment is inchoate only; it is incomplete. Though possessing the character of potentiality it lacks the character of actuality, and hence is without probative force. Recurring again to section 5375, ■defining what lands may be bound and when, we find the expression “within the county where the judgment is entered. ’ ’ Entered when ? The words used are in the present tense. It is as to what must be done then — with the action which must be had at the term in order to effect a lien that the .section is dealing. What more natural inference than that the phrase quoted means entered at the term? Giving, then, to section 5331 proper effect, and to the phrase respecting the entry of judgment, in section 5375, its proper signification, and its employment in the statute its proper purpose, we conclude that that section requires that both conditions be satisfied, and that in order to an effective judgment, one on which execution may issue as contemplated by section 5374, and which will create a lien upon real estate, as contemplated by section 5375, it must be entered on the journal as well as pronounced by the court; in other words, that the judgment isn’t “rendered,” within the meaning of the last cited section until it is entered on the journal.

This conclusion is strengthened by a consideration of the purpose of our recording acts. These acts rest upon a recognition of the policy that there should somewhere be found a record which will disclose the state of the title of all lands within the county. For conveyances, mortgages, leases, etc., resort is had to the office of the county recorder; for tax liens to the tax duplicates ; for judgment liens to the records of the courts. The entry of the judgment of the court of common pleas, in connection with the docket entries, constitutes, prior to the making up of the final record, a record which shall be notice to the world of the lien of the judgment upon the debtor’s lands, and when so entered all men must take notice of the lien at their peril. The business public, therefore, has a high interest in the maintenance of such a system as will enable every person, by the ordinary inquiry, that is an examination of the records, to ascertain the condition of titles. The statute in review was enacted for the benefit of the judgment creditor, but it is only reasonable to hold that the obligation rests on him, if he claims the advantage it gives, to comply strictly with its terms in order that due notice of such claim be given to the world, and that innocent persons shall not suffer. He controls the proceedings ; he can take advantage of the statute or not at his pleasure. If he does comply he has given the notice and effected the lien; if for any cause he falls short, the consequences should be upon him. In the present case, one tracing the title would have found it in Hendrickson. He would have then found only an action for money pending against the owner, but no judgment entered at the adjournment of the term. The abstractor would then have been justified in concluding that the land was not affected by the pending action. Upon every consideration of justice, and in order to make section 5375 consistent with other laws on the subject of liens upon real estate, we are required to give such construction to the section as will require that in order to effect a lien upon lands as of the first day of the term, as contemplated by section 5375, the entry of judgment as well as the announcement thereof, must be made during the term.

If we are to treat this entry of judgment as one ordered nunc pro tunc, the law applicable to the case would seem to involve little difficulty. It is entirely settled law that an entry of judgment nunc pro tunc will not be ordered where it will prejudice intervening rights of innocent persons. As expressed by Professor Black in his work on Judgments, section 137: “When a judgment is entered nunc pro tunc, its effect, so far as it operates by relation back to the earlier date, must be confined to the rights and interests of the original parties ; at least it will not be allowed to work detriment to the rights of innocent third persons acquiring interests without notice of the rendition of any judgment. Thus a purchaser of real estate takes it charged with the lien of only such judgments as are actually existing at the time of the purchase, and it is not competent for a court to bind by a lien 1 the lands of a third person by the rendition of a nunc pro tunc judgment against his grantor.” And as held in Miller v. Wolf, 63 Iowa, 233: “A purchaser of real estate takes it charged with the lien of only such judgments as are actually existing at the time he purchases.” See, also, Borer v. Chapman, 119 U. S., 587; Smith v. Hood & Co., 25 Pa. State, 218; Newburgh Bank v. Seymour, 14 John., 219; Galpin v. Fishburne, 3 McCord, 22; Mc Clannahan v. Smith, 76 Mo., 428;Koch v. R'd Co., 77 Mo., 354; Ninde v. Clark, 62 Mich., 124; Graham v. Lynn, 4 B. Monroe, 17; Acklen, Adm'r v. Aciden, 45 Ala., 609; Hays v. Miller, 1 Wash. Terr., 143’; Shirley v. Phillips, 17 111., 471; Church v. English, 81 111., 442; Wells v. Gieseke, 27 Minn., 478. It would seem to follow necessarily that where the innocent purchaser has had no notice of the application for the order nunc pro tunc, the judgment so ordered entered should not be held to preclude him.

It is important, however, to a clear understanding of the case, to note that the averment in the answer is not, in words at least, that the judgment was entered nunc pro tunc. The averment in that respect is that at no time during the January term was there spread upon the journals any judgment or finding in respect to theicase, nor was any entry then filed in said court, but that on the fourth day of April (four days after final adjournment of the term), a journal entry was prepared by counsel for plaintiff setting forth a finding and judgment in the suit, and then placed upon the journal as of the twenty-ninth of March preceding, which was during the term. It thus appears that the action of the clerk in putting the entry on the journal was by procurement of plaintiff’s counsel rather than by order of the court. It is to be concluded, also, we suppose, that, upon its face, the judgment appears to have been rendered and entered on the twenty-ninth day of March, a day within the term; and if this is conclusive, and cannot be contradicted by proof of the alleged facts, then it binds the lands from the first day of the term by virtue of section 5375, and the demurrer to the answer was well taken and the judgments below are right.

. This brings us to a question not argued by counsel, viz : can Irvin T. Coe, plaintiff in error, be heard to question the conclusiveness of this judgment as it appears upon its face?

The subject of when a judgment is open to collateral attack is a vexed one. Upon the one side are found weighty considerations affecting the public convenience and welfare, especially in regard to the maintenance of the integrity of land titles ; on the other the strong desire of courts to avoid results which work out positive injustice to individuals. Thus has arisen a conflict between principles of policy, and principles of natural justice, and, as might be expected in cases of such conflict, the decisions of courts have differed. Indeed the differences have been so frequent and so marked that any attempt to reconcile them would be futile, and a review of them would take more space than probable results would warrant. It is and has been since the organization of our state, assumed that judgments of courts import absolute verity and, as a broad proposition, that a judgment of a court of general jurisdiction, having jurisdiction of the cause and the parties, cannot be im.peach.ed collaterally. In the great majority of the cases where the question has arisen the interests involved have been those acquired under the judgments sought to be attacked, as titles to real estate, or the like, where the effect of allowing the judgment to be overthrown would be to destroy the title of innocent persons who have invested their means in reliance on the judgment. The case at bar is one where the opposite is true; and no ease like it is found reported in the books.

The general rule, however, has not been without exceptions. While it is true that the parties must resort for relief from the judgment, to a direct attack, as by appeal, motion to correct, or proceeding in error, yet strangers to the judgment, not being- entitled to impeach it directly, and who if the judgment were given full faith and effect, would be prejudiced in some pre-existing right, are placed upon a different footing. It is said by Professor Freeman, in his work on Judgments, section 335, that “being neither parties to the action, nor entitled to manage the cause nor appeal from the judgment, they are allowed to impeach it whenever it is attempted to be enforced ag'ainst them.” It is observed by Professor Greenleaf, in his work on Evidence, section 522, that: “Justice requires that every cause be once fairly and impartially tried; but the public tranquility demands that, having been once tried, all litigation of that question, and between those parties, should be closed forever. It is also a most obvious principle of justice, that no man ought to be bound by proceedings to which he was a stranger.” In note to Hargrave’s Law Tracts, 456, it is said : “Fraud was a matter of fact, and if used in obtaining judgment, was a deceit on the court and hurtful to strangers, who, as they could not come in to reverse or set aside the judgment, must of necessity be admitted to aver it was fraudulent.” And by Sutherland, J. in Griswold v. Stewart, 4 Cowan, at page 458: “The rule that records can not be impeached in pleading, is founded on the consideration that the regular and orderly way of trying their validity is by writ of error; and that it might lead to great abuse, to permit the solemn judgment of. a court of record to be incidentally called in question in pleading, when a more direct and satisfactory mode of testing their validity exists. The reason of the rule shows its limitation. It is confined to parties or privies, who alone can bring error. It does not apply to strangers.” In Vose v. Morton, 4 Cush., 27, Shaw, C. J. says: “The demandant claims title under an attachment followed by a valid judgment in the circuit court of the United States, an execution on that judgment, and a levy of the execution on the premises, as the property of Moses Morton, 2d, the judgment debtor. If this title is well established, it must prevail, although the tenant had a valid deed of prior date which was good against everybody but creditors, and purchasers without notice. B,ut the demandant must make out his case strictly ; he must prove that he was a creditor of Moses Morton, 2d; that he attached the premises prior to the registration of the tenant’s deed; and that such attachment was followed by a good judgment, execution and levy. The first point relied upon by the demandant is, that the judgment of the circuit court is conclusive, and that the tenant cannot aver against it. But we are of opinion that this position cannot be maintained. A judgment is conclusive only against parties and privies. The tenant is in no sense a party or privy to that judgment. He is, indeed, privy in estate with Moses Morton, 2d, under whom he claims the demanded premises; but no question respecting the title to such estate was embraced or determined in that suit. It was only after that judgment was rendered, that by a distinct and collateral act, the judgment creditor attempted to satisfy his execution upon it, by a levy on the premises claimed by the tenant. * * * Being neither a party nor privy to the judgment, he cannot have a writ of error to reverse it, although it may be erroneous and void ; but, when such judgment is set up collaterally to defeat the tenant’s title, which is otherwise good, and the tenant can show that the judgment is erroneous, either in matter of law or fact, he may do so by proof. It is a general and established rule of law, that when a party’s right may be collaterally affected by a judgment, which for any carise is erroneous and void, but which he cannot bring a writ of error to reverse, he may, without reversing, prove it so erroneous and void,, in an}^ suit, in which its validity is drawn in ques-tion. The cases are numerous, and a few only will be cited, including the first and the last, which have been decided in Massachusetts. Alexander v. Gould, 1 Mass., 165; Smith v. Saxton, 6 Pick., 483 ; Pond v. Makepeace, 2 Met., 114 ; Leonard v. Bryant, 11 Met., 370. In Leonard v. Bryant, 11 Met., 370, the demandant’s title was derived from Chester Denison and George G. Denison; and the tenants set up a judgment in their favor against George G. Denison and one McGinney, recovered before the deed from George G. to the demandant was recorded. To this judgment the tenants objected because the same was rendered contrary to the provisions of the statute. This objection was overruled, on the ground that the judgment was only voidable by a writ of error and that the demandant might maintain a writ of error, as a privy in estate, or because the judgment, was prejudicial to him by intercepting his title. The court was unanimously of the opinion after a careful examination of the authorities that the ruling below could not be sustained, and Held, In a writ of entry brought by L. against B, to recover possession of the land, that the said judgment was contrary to law and erroneous; but that there was no such privity of estate between L. and D. and E. as would authorize L. to maintain a writ of error to reverse the judgment, and therefore he might avoid it by plea and proof. ”

It has appeared by the authorities cited that two principal grounds on which collateral attack by strangers has been permitted are fraud and want of jurisdiction.

In the case at bar one risk which the purchaser took in buying when he did, although unknown to him, was that during the term a valid judgment might be taken against his grantor. He incurred no other peril by reason of the pending action ; and it is difficult to see that he is in any worse plight than he would have been had he examined the records of the court the day after the final adjournment of the January term, and found that no judgment had been taken against his grantor, provided the alleged facts can now be inquired into. As the record stood then his deed conveyed to him a title clear of any lien. What, then, was the character of the act which sought to impose a burden on his land? It was without the purchaser’s knowledge; it was presumably without the knowledge of the judg'e. Its effect, if sustained, will be to make that appear to be true which in fact is not true; to make the records of the court, in other words, speak an untruth. It is, as to this purchaser, the obtaining of a pecuniary advantage by unfair means. That actual fraud is not alleged nor shown to have been intended is not conclusive. The facts are pleaded. The act itself was intended. Its effect, as we believe, if carried out, would work a constructive fraud. The precise case has, perhaps, not been adjudicated, but analogous i questions have arisen in the courts of sister states. In Downs v. Fuller, 2 Met., 135, it is held that: “When a judgment, recovered contrary to law, is prejudicial to a third party, he may avoid it by plea and proof.” And in the opinion it is observed by Wild,'J.: “Although the judgment in favor of the plaintiff in the present case, was not recovered by collusion with his debtor, or with any fraudulent intention, yet we think the defendant has a right to avoid it in the same manner, because he is neither party or privy to the plaintiff’s judgment, and is not entitled by the rules of law to reverse it by a writ of error. This was so decided in Warter v. Perry, Cro. Eliz., 199, and in Randal’s case, 2 Mod., 308; and the same principle is laid down in Com. Dig. Error, D; and in 5 Dane Ab. 225. This rule of law does not appear, in any case to have been controverted, and it seems reasonable and just, that where a judgment is recovered contrary to law, and prejudicial to a third party, he should have a right to avoid it.” Hunter, Assignee, v. Cl'd Stove Co., 31 Minn., 505, is in point as involving the precise principle. The syllabus is: “The plaintiff, as statutory assignee of certain land for the benefit of creditors, brings this action to determine an adverse claim to the same made by the defendant. The adverse claim as set up in defendant’s answer, is based upon the alleged lien of a judgment confessed by plaintiff’s assignor, and appearing upon the records of the district court to have been indorsed upon the ‘statement’ for confession, and docketed before the assignment to plaintiff, while in fact, and as the reply alleges, the judgment was not so indorsed nor entered in the judgment book until more than six months after the making’ and filing of the assignment. Meld, that in this action the false record may properly be attacked, and plaintiff’s title as assignee adjudged paramount to the lien appearing to be thereby created.”

The opinion, by Berry, J., so well expresses our view that we take space to quote from it at length: “In the case at bar the plaintiff is a stranger to the alleged judgment — just as much so as would be one of the creditors whom he represents — and hence he is not estopped or in any way bound by it. 1 Greenl. Ev., section 532. Under the statute, as assignee, he takes and holds the assigned property, in trust for the benefit of creditors of the assignor. Hence it is his plain duty to protect and defend it, and, so far as lies in his power, to make it available to the payment, of the creditors claims. If after he has taken the lands under the assignment, the records of á court are so manipulated as to show a judgment lien upon the assigned property at the time of the assignment, and such records are false, there being no such judgment lien at that time, it is the assignee’s duty to protect the property by removing the cloud which the false records raise. He cannot move in the action or quasi action in which the alleged judgment lien was obtained, for he is not a party to it; neither has he succeeded to the rights or liabilities of any party to it. As respects the judgment, there is no privity between him and either party to it. Mann v. Flower, 26 Minn., 479; and see Bennett v. Whitcomb, 25 Minn., 148; Vose v. Morton, 4 Cush. 27; Freeman on Judgments, section 162. Nevertheless, there must be some way in which he can have it adjudicated that his title to the land is paramount to the lien of the defendant’s judgment, notwithstanding the appearance of the record to the contrary, for otherwise his case would be the inadmissible one of a clear legal right without a remedy. He must therefore be able to attack the false record in some way. * * * His concern is that his title be adjudged paramount to the lien apparently created by the false record. We see no reason why this may not be done in the present action.* * * It is an action to determine defendant’s adverse claim. The answer sets up the judgment, and the reply the facts which go to show that the record is false. An issue as to the validity of the apparent lien, is thus distinctly raised in the pleadings. The facts set up in the answer, and found by the court, also show that, as respects the plaintiff, the record is not only false, but in law fraudulently false, though, as the court finds, there may have been no moral fraud. That fraud vitiates everything is a rule without exception, and which applies to a judgment as well as to an ordinary contract. Steph. Ev., art. 46. Why may it not also apply to the false and fraudulent record of a judgment? And why,' in an action like the present, may not a party injured by such record have it adjudged to be false and fraudulent as respects him, and thereby secure just and appropriate relief, without disturbing a record with which he has no further concern, save as it clouds his title? We see no good reason to the contrary. It is true that the record of a judgment is stated by high authority to be conclusive evidence of the fact of the rendition of the judgment, and of all the legal consequences resulting from that fact, whoever may be the parties to the suit in which it is offered in evidence. 1 Greeni. Ev., section 538. But, in our opinion, this statement is too broad when sought to be applied to an attack upon the record by a stranger, upon the ground that it is as to him false and fraudulent. Such an attack may, in a ease like this at bar, be made in a collateral action. See McIndoe v. Hazelton, 39 Wis., 567, and Edson v. Cumings, 17 N. W. Rep., 693, and cases cited.”

As to jurisdiction, the court of common pleas acquired jurisdiction of the parties and of the subject matter. It pronounced a judgment during the term, but did not then enter it. One requisite of a judgment is that it must be given at the right time. As said by Bouvier, Law Die., vol. 2, page 15: “To be valid, a judicial judgment must be given by competent judge or court, at a time and place appointed by law, and in the form it requires. A judgment would be null if the judge had not jurisdiction of the matter, or having such jurisdiction, he exercised it when there was no court held. ’ ’ Under our practice the court retains control of its journals during the term; it may then add to, strike out or alter that which is on the journals, or incorporate new matter. On the final adjournment, however, that control is lost. This we take to be elementary. Confessedly the judge cannot, in vacation after the term, render a judgment. How can he make an order affecting a judgment which he had in fact pronounced in term? An order necessary to complete the judg’inent and make it effective? While it cannot be said that jurisdiction of the case had been lost, nevertheless an attempt to exercise jurisdiction at the time this entry is alleged to have been made, would, according to the authorities, have been as futile, at least as regards the rights of persons not parties nor privies, as though jurisdiction had in fact been lost because there was no court then to exercise it. That the court at a subsequent term has power to then order the entry of a judgment actually pronounced during a preceding term, is well understood, but that does not cover the case. We have found that such an order will not avail as against the intervening rights of an innocent purchaser. But even such an order cannot be made by the judge in vacation; it can be made only by a court in session, and the court, between terms, is not in session. How, then, can the counsel and the clerk, by an entry made after the term is over, give to such entry the effect of a judgment of a court, as against strangers, at a time when the judge himself would be powerless to act? We think they cannot. If there was power in the clerk and counsel to cure the omission four days after the term, then they might do it forty days after, or four hundred. We have not overlooked the practice of making entries on the journal after the term. It is common and is acquiesced in by counsel and parties. One reason for such acquiescence is that where judgment has in fact been pronounced, it would be within the power of the court at a subsequent term, to order the entry made, and so no substantial advantage would result from objection; and there are other considerations of convenience involved. But it does not follow that because the practice is acquiesced in by litigants and their counsel that it must be held to conclude strangers.

Our conclusions are that section 5375 requires that in order to create a lien as of the first day of the term, there must be an entry of judgment on the journal during the term; that the entry made in this case after the term was unauthorized and worked a fraud upon the plaintiff in error; that the judgment, as it appears of record, does not conclude his rights, and that, not being a privy as respects the action then pending, he could not maintain a direct action to review the judgment, and, therefore, has the right to challenge its effect on his property in the case at bar.

The judgments below will be reversed and the cause remanded with direction to overrule the demurrer to the answer, and for further proceedings according to law.

Beversed.


text:
    Philip Smith v. The State of Ohio.

      Private lands taken for canal purposes — Compensation to owners— Act of February 4, 18S5 — Demand foi appraisal — Nature of occupancy by state• — Basin constructed by owner of land adjacent to canal — Use of waters of canal— Respective rights of state and owner.

    1. It is the purpose of the act of Peb. 4, 1825 (25 O. L., 57), to award compensation to owners for private lands taken for canal purposes, where they have not been donated, and where the loss or damage exceeds the benefits, and to afford opportunity to such owners to make demand for appraisal of such damages. Hence, in order to the acquisition of title to lands for canal purposes by the state under the above act, by occupancy and use, it is necessary that the occupancy by the state be exclusive, and that it be so open and notorious as to put the owner on notice that the property has been taken by the state for its own, with the purpose of incorporating it as part of its canal system.
    2. Where a basin has been constructed by a private owner of lands adjoining a canal, for the purpose of enhancing the value of his adjacent property, the basin to be used by persons navigating boats on the canal in lading, unlading, passing and turning, and no purpose to donate the land of the basin to the state is shown, the facts that the water of the canal is permitted to flow in and constitute the water of the basin, and that occasionally boats used by the board of public works in making repairs used the basin for lading, unlading and turning, and that occasionally, many years after the completion of the basin, engineers employed by the board of public works caused the basin to be cleaned out, do not constitute notice to the owner of the basin lands that the state has taken possession of the same as its own for canal purposes, nor such exclusive occupancy as to imply an appropriation.
    (Decided December 13, 1898.)
    Error to the Circuit Court of Shelby county.
    The State commenced its action in the court of common pleas to recover a small parcel of land in Sidney, Shelby county, alleging that it had a legal estate in and was entitled to possession, and that plaintiff in error, Philip Smith, keeps it out of pos-‘ session. Smith answered, admitting- possession in himself, denying title in the State, denying that the State had ever appropriated or otherwise acquired title, and alleging ownership in himself by mesne conveyances from the original owner. In the common pleas judgment was given for defendant. On error to the circuit court this judgment was reversed and final judgment given for the State. Further facts appear in the opinion. ™

      John F. Wilson and Anckrew J. HeSs, for plaintiff in error. ^

      John L. Lott, assistant attorney-general, and Davies <& Hoskins, for defendant in error.
   Spear, C. J.

The land in controversy is that on which was located a basin connected with the Miami and Erie canal, which basin was constructed by one George W. Dickson, who is the common source, of title. The canal was completed through the vil] age of Sidney in the year 1840. In the year 1844, Dickson, who owned lands in the village, platted them as an addition, and marked off a tract called “Basin,” and the basin was soon after constructed by him. It adjoined the canal, and nine lots of the addition abutted upon the basin. When completed, the bank which divided it from the canal, was taken away by Dickson, and the water from the' canal flowed into the basin and supplied it from that time so long as used. It was constructed wholly at Dickson’s expense, and for the purpose of forming a stopping place for boats navigating the canal, for loading and unloading and for turning, the ultimate purpose being to add value to Dickson's adjacent lots. Soon after the basin was completed Dickson sold the lots. The basin was so used for thirty-five to forty years, and until the canal lost much of its importance as a water-way, and fell into gradual disuse, since which time the purchasers of the basin lands from Dickson, in- • eluding the plaintiff in error have been in occupancy of it. It is now nearly filled up.

About the year 1853, one W. J. Jackson, employed in the engineering service on the canal, and connected with the. public works, and in charge of the portion of the canal with which the basin connected, caused the basin to be cleaned out. He, also, when in the employ of the lessees from the State, caused it to be cleaned out. Some years after, this engineer, seeing some persons in the act of filling a portion of the basin, or putting up a wall for the purpose of building a house, stopped them, claiming the property as belonging to the State. He considered it as part of the canal, and so treated it. These persons were strangers to Jackson, and their identity is not disclosed.

The contention on the part of the State is that the turning in of the water which belonged to the State, and the State’s use of the basin for many years in connection with the canal, constituted an appropriation, and that therefore the State has title to the land in fee simple. The ultimate question, therefore, is: Was there an appropriation? The State’s claim is believed by its counsel to be supported by the cases of Malone v. Toledo, 28 Ohio St., 643, and 34 Ohio St., 541; The State ex rel v. Railway Co., 53 Ohio St., 189, and State v. Snook, same volume, 521.

It is not doubted that if this basin was actually appropriated a fee simple title vests in the State. We are not, therefore, aided in the inquiry as to whether the acts shown amounted to an appropriation by the case of Malone v. Toledo, because the fact of appropriation was not in that case contested; nor by State v. Snook, because the case deals with lands of which, admittedly, the State acquired possession under the act of February 4, 1825, 23 Ohio Laws, 57, and the act of February 7, 1826, and used in the construction of the canal, which implies an appropriation. Are we aided by the case of State ex rel v. Railway Co. The third paragraph of the syllabus holds that by force of section 8 of the act of February 24, 1825, “whenever the state actually occupied a parcel of land for canal purposes, a fee simple title thereto at once and by virtue, alone, of such occupancy, vested in the state.” It may be remarked in passing that, inasmuch as there was no real contention as to the fact of appropriation by the State of the land in controversy and its long exclusive use as part of the canal system, this proposition of the syllabus settled no contested point in the case, and may properly be treated as simply a predicate for the proposition which follows. However, the term “actually occupied” imports, ex vi termini, exclusive occupancy; so that it would be necessary to show that a claimed occupancy by the State was an exclusive occupancy in order to bring the case within the letter of the proposition. This, we think, the facts fail to establish in the case at bar. An occasional use, in common with other navigators on the canal, of a private basin, by boats belonging to the State, an occasional dredging out by an engineer in the employ of the State, and a claim entertained by him that the basin was the property of the State, not communicated to the actual owner of the land upon which the basin was constructed, or his successors in title, cannot, standing alone, be regarded as showing exclusive occupancy by the State. We think, therefore, that the ease at bar is not controlled by either of the cases cited.

Much importance seems to be attached in argument to the fact that the waters of the canal filled the basin. Manifestly this simple fact is not sufficient to authorize the conclusion that exclusive occupancy is thereby shown or a possession by the State thereby accomplished, else permission to take water which may flood adjoining lands, for the purpose of watering- stock, or for power — not an uncommon thing-in the history of canals — would at once vest title in the State to the land over which the water thus flows. Clearly the act must take its character from the purpose with which it is done, and when this act of flooding is considered in connection with the known purpose of the projector of the enterprise in .the construction of the basin, and the uses to which it was to be put — uses which contemplated at all times regulation by the owner —uses beneficial, it is true, to persons who were at the same time using the State’s canal, and in some measure to the State itself, but capable of enjoyment apart from and in addition to such uses, and entirely consistent with continued private ownership by the projector, it is plain that no exclusive occupancy by the State was intended by the act of flooding the basin. In no view of the case can it be consistently claimed that the construction and maintenance of the basin implied a purpose to devote the land itself to an exclusive public use, or to any joint use, after the object of its construction should be accomplished. Private ownership of places and structures for convenience in mooring and lading boats was common in the use of canals. It is distinctly recognized by the act of March 23, 1840, 38 Ohio Laws, 87, section 32. And no reason is apparent why private ownership in lands used for a basin' could not continue as well as in places for mooring, and for lading and unlading boats.

Nor do the facts warrant the conclusion that the basin was appropriated by the State. The statute under which lands necessary for this canal were acquired is the act of February 4, 1825, before referred to, which is an act to provide for the internal improvement of the State by navigable canals. Section 8 of the act makes it lawful for the canal commissioners, by themselves and any superintendent, agent or engineer, to take possession of and use any lands, waters, etc., necessary for the prosecution of the improvements intended by the act, and .to make all such canals, feeders, etc., as they may think proper for making said improvements, and where such lands, etc., taken and appropriated for any of the purposes aforesaid, have not been given or granted to the State, then the commissioners, on application of the owners, shall proceed to have an appraisal by five discreet, disinterested persons, and, if damages are found to exceed benefits, shall pay the damages assessed, and the fee-simple shall then vest in the State. It was not the purpose of the act, nor is it the policy of the State, to take land of the citizen fop public use without affording the owner an opportunity to make application for an appraisal, and upon appraisal being made as prescribed by statute, to pay damages if any are assessed. It is clear, also, that the act contemplates such assertion of exclusive control as would put the owner on notice that the property had been taken by the State for its own, and incorporated as part of its canal system. As already indicated, it is expressly shown by the record in this case that the basin was laid out and constructed by Dickson as a private enterprise, and it is in no way shown that he subsequently intended to donate it to the State, nor is there any pretense that there was any demand by the State, or its proper officers, of the owner, of possession for the purpose of incorporating the basin into the canal system, nor any niformation given him that the State proposed to take the basin, nor is any attempt shown to acquire the land for the State by any proceeding- contemplated by the statute. There was no time when Dickson, or his successors in title, could have had the benefit of the provisions as to appraisal, for, as already found, neither had notice of the intention on the part of the State to acquire the property under the stabute.

As conclusion, we are of opinion that the record shows no actual appropriation of these lands by the State, and no such exclusive occupancy of them by the State as to raise a presumption of appropriation, and hence that no title vested in the State. To avoid possible misunderstanding we add that the lands here referred to are the lands only which were the property of Dickson, and could not, in any possible view, include any part of the lands constituting the berme bank of the canal. Over such lands the State has exclusive control and title.

Judgment of the circuit court reversed and that of the common pleas affirmed.

Reversed.