decided, and after having stood for several years as rules to govern transactions, they should not be opened merely to consider again the weight of conflicting decisions and opposing reasons.

RICO et al. v. SPENCE et al.

1 QUIETING TITLE-POSSESSION OF PLAINTIFF ESSENTIAL.-To maintain an action to quiet title, under the two hundred and fifty-fourth section of the Civil Practice Act, it is essential that the plaintiff have possession of the premises when the action is commenced.

* IMPEACHMENT OF PATENT.-Until the validity of a grant from the Spanish or Mexican Government has been determined by the tribunals of the United States, under the Act of Congress of March 3d, 1851, it cannot be made the basis for impeaching a patent for the same premises.

PATENT CONCLUSIVE. Thus, where the validity of the claim of the defendant, under a Mexican grant, had been recognized and confirmed, and a patent to him issued thereon by the United States: Held, that the plaintiff, relying solely upon an opposing unconfirmed grant from the Mexican Government, embracing the same premises, could not call in question the rights of the defendant, either in law or equity.

EFFECT OF NON-PRESENTATION OF MEXICAN GRANT.-Where claimants under Spanish or Mexican grants have never presented their claims for confirmation, under the Act of March 3d, 1851, such claims are to be treated as non-existent, and the land, so far as they are concerned, is to be considered as part of the public domain.

MEXICAN GRANTS, ADVERSE CLAIMS TO.-Where the parties each claimed the same premises under independent Mexican gaants, and the defendant, with knowledge of the plaintiff's claim, proceeded to obtain a confirmation of his claim and a patent therefor: Held, that no equities could arise in favor of the plaintiff, and against defendant, from the latter's knowledge of the adverse claim, nor was he, by reason of this knowledge, affected with notice of any equitable rights of the plaintiff.

APPEAL from the Third Judicial District.

'Affirmed in Lyle v. Rollins, 25 Cal. 437; Pralus v. Jefferson G. & S. M. Co., 34 Cal. 559. See also Van Winkle v. Hinckle, ante 342; Brooks v. Calderwood, 34 Id. 565; Sepulveda v. Sepulveda, 39 Id. 18; Nev. Co. & S. C. Co. v. Kidd, 37 Cal. 307; 4 Sawy. 544. Cited as authority in Banks v. Moreno, 39 Cal. 246; and cited inferentially in Salmon v. Symonds, 30 Cal. 307. See also Emeric v. Penniman, 26 Cal. 124; O'Connell v. Dougherty, 32 Cal. 463; Clark v. Lockwood, 21 Cal. 221; Grattan v. Wiggins, 23 Cal. 37; Willson v. Castro, 31 Cal. 439; Moerenhart v. Barron, Jan. T. 1872 (not reported); Schmitt v. Geovanini, April T. 1872 (not reported.)

3 Seo Minturn v. Brower, 24 Cal. 640; Steinbach v. Moore, 30 Cal. 506; 31 Cal. 131; Stevenson v. Bennett, 35 Cal. 432.

The facts are sufficiently stated in the opinion.

Nathaniel Bennett, for Plaintiffs and Appellants.

[505] *The subject matter of dispute in this case is a ranch in the county of Monterey. The main point in the case is, that the defendant holds the legal title in trust for the plaintiffs, who have the equitable title.

The plaintiffs claim under a grant from the Mexican Government. The defendants claim under a pretended grant from the same Government, fortified by a patent from the United States, issued in pursuance of the Act of Congress of March 3d, 1851, for the settlement of land titles in California. The plaintiffs insist that the patent of the defendant inures to their benefit.

The complaint is framed with a double aspect: 1st, under our statute to quiet the title; and 2d, upon the general principles of equity, to declare and enforce a trust. Both points, however, in fact resolve themselves into the same thing; for we do not well see how we can maintain an action to quiet the title without at the same time establishing the trust.

Although the complaint may not, in so many words, pray that the defendant may be declared to hold the land as a trustee for the plaintiffs, it does contain the substance of such prayer, as it asks that the defendant Spence may be decreed to convey the land to the plaintiffs; and besides, the facts set forth in the complaint being sufficient to entitle us to relief asked for, the Court will grant such relief even though not prayed for.

The answer denies all the allegations of the complaint, except that the defendant Spence holds a patent of the United States for the premises, and the execution of the mesne conveyances to Spence from José Mariano Estrada, and sets up numerous substantive defenses, based upon the Statute of Limitations; but as the proof does not sustain them, it is unnecessary to notice them.

We insist that all the material allegations of the complaint. are sustained by the proofs; and the only question is, does the law upon them entitle the plaintiffs to the relief demanded? Judge Story, in his Equity Jurisprudence (vol. 2, sec. 1195)

includes among implied trusts, "those which are forced upon the party by operation of law; as, for example, in cases of fraud, imposition, notice of an adverse equity, and other cases of a similar nature.”

*In this case the defendant had all along notice of [506] the adverse equity of the plaintiffs; and therefore the

procuring of the patent in his own name and for his own benefit, operates as an imposition on the rights of the plaintiffs. The case is analogous to that, to say the least, where a man buys land with another's money and takes the conveyance in his own name (2 Story's Eq. Juris. 55, sec. 1201;) or in the case where a profferment is made without consideration, in which event the use results to the proffer. (Sec. 1201.)

The position for which we contend has already been passed upon by this Court in Estrada v. Murphy, 19 Cal. 249. That case goes the full length of sanctioning the decree for which we ask. It is there held that "if the confirmee in presenting a Mexican claim, acted as agent, or trustee, or guardian, or in auy other fiduciary capacity, a Court of Equity, upon a proper proceeding, will compel a transfer of the legal title to the principal cestui que trust, ward, or other party equitably entitled to the same, or subject it to the proper trust in the confirmee's hands. It matters not whether the presentation were made by the confirmee in his own name in good faith, or with intent to defraud the actual owner of the claim, a Court of Equity will control the legal title in his hands so as to protect the just rights of others."

And the case of Castro v. Hendricks, 23 How. 441, cited in Estrada v. Murphy, fully sustains the doctrine of the latter case; as the necessary result of the case of Castro v. Hendricks is, that the fact of obtaining a patent is not conclusive in favor of the patentee, but that others may be shown to have the better right, and that the Government has no interest in the contests between persons claiming ex post facto the grant.

We think we might safely rest our case on the two cases last cited; but the precise doctrine for which we contend is laid down in Boggs v. The Merced Mining Co., 14 Cal. 280, in the following words: "The proceeding by bill in equity, which an individual is allowed to take to set aside a patent or control its operations, is in the nature of a bill to quiet title

to determine an estate held adversely to him—to remove what would otherwise be a cloud on his own title; or is in the nature of a bill to enforce a transfer of the interest from the patentee, on the ground that the latter has, [507] *by mistake or fraud, acquired a title in his own name, which he should in equity hold for the benefit of the complainant. The individual complainant must therefore possess a title superior to that of his adversary, and of course, to that of the Government through whom his adversary claims, or he must possess equities which will control the title in his adversary's name."

Apply the doctrine of that case to our own. Our proceeding is by bill in equity. It is to impose a trasfer of the interest of the patentee. He has acquired a title in his own name, which he should in equity hold for the plaintiffs. The plaintiff's possess a title, which prior to the patent to the defendant, was, in equity at least, superior to that of the defendant, and to that of the Government through which the defendant claims. And the plaintiffs, therefore, possess equities which ought to control the title in the defendant's

name.

Nor should it be supposed that our case cannot be maintained because the Court below found that the defendant was not guilty of fraud. (This was not the finding of the Court as claimed by counsel, but merely the opinion of the Court below, as this Court will see by an examination of the opinion or finding.)

case.

This is an equity case, and this Court is not bound by the finding of the Court below on questions of fact; but it is unnecessary for us to establish actual fraud. What the law denominates constructive fraud is all we need to maintain our This is illustrated in almost every possible shape in the chapter on "Constructive Fraud," in Story's Equity Jurisprudence (vol. 1, pp. 268-440.) Thus, if José Mariano Estrada under whom the defendant pretends to claim, had notice of the Mexican title of his son José Santiago Estrada, under whom the plaintiffs claim, that would amount to constructive fraud. In such case, a Court of Equity "will hold the purchaser a trustee for the benefit of the person whose rights he has thus sought to defraud. (1 Story's Eq. Juris. secs.

395, 396, 399.) Not a shadow of doubt can exist but that the defendant had full knowledge of the claim or title of Santiago.

That the decree which we ask for is the proper relief, is sustained by the case of Brown v. Lynch, 1 Paige's Ch. 147, where it is held that a Court of Chancery will relieve,

in a case of this nature, *by converting the person [508] guilty into a trustee for the injured party. In that case the Vice-Chancellor says, (p. 152,) quoting the language of Lord Eldon, "It has long been settled, that if a conveyance has been obtained by means which in this Court have the character of imposition, fraud, oppression, or undue advantage, the person deriving a title under it is a trustee, and the species of relief is by directing a reconveyance." And the Chancellor says in the same case, (p. 158,) "The means to be employed is to convert the person who has gained an advantage by means of his fraudulent act, into a trustee for those who have been injured thereby."

The unavoidable inference to be drawn from the case of West v. Cochrane, 17 How. 403, is in favor of our position. The action was ejectment upon a state of facts in many respects analogous to the facts in our case. The action failed because the plaintiff had not the legal title; Mr. Justice McLean remarking at the conclusion of the case (p. 416): "In this case I do not dissent, as it is the understanding of the Judges that the equity of the case remains open for further investigation."

The following authorities illustrate in a greater or less degree the position for which we contend: Moore v. Wilkinson, 13 Cal. 478; Willot v. Sanford, 19 How. 82; Garland v. Winn, 20 Id. 8; Jones v. McMaster, Id. 22; Mezes v. Green, 24 Id. 268

D. R. Ashley, for Respondent.

I. Plaintiffs not being in possession of any part of the land, could not sustain the action. (Prac. Act, sec. 254; Ritchie v. Dorland, 6 Cal. 40; Smith v. Smith, 12 Id. 216; 17 Ill. 135; Curtis v. Sutter, 15 Cal. 262; Bayerque v. Cohen et als., 1 McAl. 117; Armitage v. Wickliffe, 12 B. Munroe, 488;