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Syllabus.

another under the influence of a mistake, that is, upon the
supposition that a specific fact is true, which would entitle
the other to the money, but which fact is untrue, and the
money would not have been paid if it had been known to the
payer that the fact was untrue, an action will lie to recover it
back, and it is against conscience to retain it.” See also
Townsend v. Crowdy, 8 C. B. N. S. 477; Strickland v.
Turner, 7 Exch. 208. Reasons for the application of the rule
are much more potent in the case of contracts of the govern-
ment than of contracts of individuals; for the government
must necessarily rely upon the acts of agents, whose igno-
rance, carelessness, or unfaithfulness would otherwise often
bind it, to the serious injury of its operations.
The judgment must be reversed, and the cause remanded for

a new trial, and it is so ordered ; and it is further ordered
that this judgment be entered as of the 30th day of October,
A.D. 1889, the day upon which the said cause was sub-
mitted to the court for decision, the said defendant in error
Barlow having since died.

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FRITTS v. PALMER.

ERROR TO THE CIRCUIT COURT OF THE UNITED STATES FOR THE

DISTRICT OF COLORADO.

No. 72. Submitted November 6, 1889. – Decided November 25, 1889. The constitution of Colorado provided that no foreign corporation should

do business in the State without having a known place of business and an agent upon whom process might be served. A statute of the State made provision for the filing by such corporation with the Secretary of State of a certificate showing its place of business and designating such agent or agents, and also a copy of its charter of incorporation, or of its certificate of incorporation under a general incorporation law; and, in case of failure to do so, that each and every officer, agent and stockholder of the corporation should be jointly and severally personally liable on its contracts made while in default. Said act further provided that no corporation, foreign or domestic, should purchase or hold real estate except as provided in the act. The act did not indicate a mode by which a foreign corporation might acquire real estate in Colorado. G.,

Opinion of the Court.

being the owner in fee of a tract of realty in that State, conveyed it by deed of warranty to a corporation organized under the laws of Missouri, which had not then attempted, and did not afterwards attempt to comply with those provisions of the constitution or laws of Colorado. F., the defendant below, claimed through this corporation. Some months after his deed to the corporation, G. executed, acknowledged and delivered a quitclaim deed of the premises to the grantor of P., the plaintiff below: Held, (1) That perhaps the reasonable interpretation of the statute was that a

foreign corporation should not purchase or hold real estate in Colorado until it should acquire, in the mode prescribed by the

local law, the right to do business in that State; (2) That these constitutional and statutory provisions were valid so far

as they did not directly affect foreign or interstate commerce; (3) That the company violated the laws of the State when it purchased

the property without having previously designated its place of

business and an agent; (4) But that the deed was not thereby necessarily made absolutely void

as to all persons and for every purpose, inasmuch as the constitution and laws of Colorado did not prohibit foreign corporations

from purchasing and holding real estate within its limits; (5) That the penalty of personal liability of officers, agents and stock

holders in case of non-compliance with the provisions of the statute, having apparently been deemed by the state legislature sufficient to effect its object, it was not for the judiciary to enlarge that penalty, by forfeiting the estate for the benefit of

parties claiming under a subsequent deed from the same grantor; (6) That the grantee under the subsequent quit-claim deed could occupy

no better position than the grantor, common to both parties, would have occupied if he had himself brought the action; and that, in that case, it could not have been maintained.

This was an action in the nature of an action of ejectment. Judgment for the plaintiff, to which this writ of error was sued out. The case is stated in the opinion.

Mr. L. C. Rockwell, Mr. E. A. Reynolds and Mr. Bertram Ellis for plaintiffs in error.

Mr. Joseph Shippen for defendant in error.

MR. JUSTICE Harlan delivered the opinion of the court.

This is an action in the nature of ejectment to recover the possession of certain real property in Gilpin County, Colorado, namely, the North Comstock, Grand View, Clipper and Com

Opinion of the Court.

stock lodes, and a building lot in Central City, in the same county, together with the dwelling-house thereon, the fee and possession of all which property were claimed by the plaintiff, the present defendant in error. The defendants admitted their possession of the premises described in the complaint, except the Clipper lode, and alleged their ownership and right of possession of the other property. They distinctly disclaimed all interest in the Clipper lode, and denied that they were or had ever been in possession of it. A trial by jury was waived in writing by the parties, and the case was heard on an agreed statement of facts, upon which the court was asked to declare the law and enter judgment accordingly. Judgment was rendered in favor of the plaintiff for the possession of all the property described in the complaint, including the Clipper lode. The question to be determined is whether the judgment is supported by the agreed facts.

These facts are in substance as follows: The common source of title is William Groshon, who, on the 16th of June, 1877, at Central City, in the State of Colorado, conveyed, with warranty, all the property described in the complaint, to the Comstock Mining Company, a corporation organized under the laws of Missouri for the purpose of carrying on mining business, and with the object expressed in its articles of incorporation, of purchasing, owning and controlling mining property, both real and personal, in the State of Colorado, and of conducting a mining business therewith. This deed was duly recorded in the proper local office on the 25th of June, 1877. Before the purchase from Groshon the company was engaged in the prosecution of its mining business at and near Central City, where it established an office.

On the day of the execution of Groshon's deed, the company made to Ezra D. Fritts its three promissory notes, aggregating thirty thousand dollars, which were intended to be used and were used in part payment of the price of the property conveyed to it; and, in order to secure the payment of the notes, it executed to Thatcher, as trustee, a deed of trust upon the property, except the Clipper lode, conditioned that on default in the payment of either of the notes or the

Opinion of the Court.

interest thereon, the trustee might sell and dispose of the said mining property. That deed of trust was duly recorded on the 26th of June, 1877.

On the 5th of January, 1878, default having occurred in the payment of the notes, the deed of trust was foreclosed under the

power of sale contained in it, and on that day Thatcher executed, acknowledged and delivered his deed for all said real estate and mining property (except the Clipper lode) to Fritts. That deed was duly recorded January 7, 1878.

The defendants claimed title and possession by virtue of divers mesne conveyances, in due form, from the company and its assigns under the above deed of trust, for all of the property, excepting the Clipper lode, which has never been conveyed by it.

On the 13th of April, 1878, Groshon executed, acknowledged, and delivered his deed of quit-claim of all the real estate and mining property in the complaint described to Samuel S. Porter. That deed was delivered to Porter on the 20th of May, 1878, but has never been recorded. The latter by his deed of quit-claim, executed May 20, 1878, conveyed to defendant Palmer. The latter deed was delivered to the grantee on the 25th of May, 1878, but it remains unrecorded. Afterwards, June 28, 1879, Palmer filed in the office of the clerk and recorder of the county where the property is situated notice, according to law, of the bringing of this suit, and the object thereof.

The Comstock Mining Company at the time of its purchase from Groshon had not, nor has it since that time, complied or attempted to comply with section ten of article fifteen of the constitution of Colorado, nor with sections twenty-three and twenty-four of chapter nineteen of the General Laws of that State, otherwise known as sections 260 and 261 of chapter 19 of the General Statutes of Colorado, 1883, prescribing the terms and conditions upon which foreign corporations may do business in that State.

A copy of the incorporation laws of Missouri, under which this company was organized, was, at the time of its organization, on file in the office of the Secretary of State of Colorado,

Opinion of the Court.

but was not filed by it. Its articles of incorporation were filed in the office of the clerk and recorder for Gilpin County, where its business interests were located, on August 10, 1877, and a copy of the incorporation laws of Missouri, under which the company was organized, was also on file in the same office at and after the time the company was organized.

The defendants, during the time of their possession of the property, have held the same in good faith under the above deeds, and have paid taxes legally assessed and levied upon it, to the amount of $ 400; and plaintiff has paid no taxes thereon. They have put improvements upon the property, in the way of building and repairing the dwelling-house described in the complaint, of the value of $350.

It is clear, from the facts agreed, that the object of Groshon's conveyance to the Comstock Mining Company was to pass to that corporation whatever interest he had in the property. It is equally clear that under the trust deed to Thatcher, the sale and conveyance to Fritts, and the subsequent mesne conveyances to the defendants, the latter acquired whatever interest the Comstock Mining Company got by Groshon's deed to it.

But it is contended that no title or interest whatever passed from Groshon, by his deed of June 16, 1877, even as between him and the company, and, consequently, it was competent for him, at his pleasure, and notwithstanding he received the consideration for which he stipulated, and even after the sale and conveyance of the property under the deed of trust, to make to other parties a quit-claim deed that would override, not only his conveyance to the Comstock Mining Company, but all subsequent conveyances based upon

it. This proposition is based upon certain provisions of the constitution and laws of Colorado relating to foreign corporations.

The constitution of that State declares that "no foreign corporation shall do any business in this State without having one or more known places of business, and an authorized agent or agents in the same, upon whom process may be served." Art. XV. $ 10.

The statutory provisions, for failing to comply with which

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