655] THE DISTRICT OF COLUMBIA, Appt., | bia, approved June 26, 1873, and were paid out [656] v. THOMAS W. CORNELL (See S. C. Reporter's ed. 655-661.) Cancellation of negotiable instrument effect of to contractors, jobbers and laborers, and soon After the creation of the board of audit by L. 119. The certificates so redeemed were canceled by stamping across the face in ink, with a ribbon stamp, the words "Canceled by the Board of Audit.'" They were then inclosed in jackets, tied up in bundles of fifty in numerical order, and placed on a shelf under the counter in a 1. When the maker of a negotiable instrument 4. Such certificates were in no sense money or the equivalent of money and had no validity unless issued for a purpose authorized by law, and had not the character of commercial paper so as to render them, when fraudulently issued, valid in the hands [No. 55.] of bona fide holders. Submitted Nov. 1, 1888. Decided May 13, 1889. the certificates. ly removed from a large portion of the certifi- The stolen certificates were sold by Farnham Washington, July 1st, 1873. This certifies that for work done under direction of the Board of Public Works, Countersigned: Horace J. Frost, For Commissioners of Sinking Fund. On July 1, 1873, such certificates to the Treasurer. their certificate. Last six months' interest payable with appearance as to indicating signs or evidences The judgment of the Court of Claims in fa- [657] [658] [659] [660] certificates as were shown to have been so pur- Messrs. A. H. Garland, Atty-Gen., R. A. Mr. Samuel Shellabarger and J. M. Mr. Justice Gray delivered the opinion of were held by a majority of this court to be lia- In Burbridge v. Manners, Lord Ellenborough said: "It is the duty of bankers to make some memorandum on bills and notes which have been paid,"-clearly indicating his opinion that the making of such a memorandum upon the securities would be sufficient to protect the bankers from being afterwards held liable to any holder thereof. The decision in Ingham v. Primrose, holding the acceptor of a bill of exchange, who had torn it in halves and thrown the pieces into the street, liable to one who afterwards took it, in good faith and for value, from one who had picked it up and pasted the pieces together, proceeded upon the ground that the tearing of the bill into two pieces, as manifest on its face, "was at least as consistent with its having been divided into two for the purpose of safer transmission by the post, as with its having been torn for the purpose of annulling it." And the decision can be maintained, if at all, on that ground only. Barendale v. Bennett, L. R. 3 Q. B. Div. 525, 532. In Baxendale v. Bennett, one who had given his blank acceptance on stamped paper to another and authorized him to fill in his own name as drawer, and received it back from him unfilled, and put it in the unlocked drawer of his desk, from which it was afterwards stolen, and filled up, without his authority, by inserting the name of another person as drawer, was held not liable to an indorsee for value. In State v. Wells, Fargo & Co. 15 Cal. 336, cited by the claimant, treasury warrants of the State of California had been once lawfully is sued, presented and paid, but never canceled in any way before they were stolen and again put in circulation; and the suit was not upon the warrants, but was brought by the Siate against bona fide holders who had presented them a second time, and to recover back the value of bonds which the State had delivered to them in exchange for the warrants, and which they, in good faith, had since parted with. Much reliance was placed by the claimant upon the case of Cooke v. United States, 91 U. S. 389 [23: 237], in which the United States 91 U. S. 404 [23: 245]. We are not prepared to extend the scope of that decision, and the facts of this case, as found by the Court of Claims, are quite different. The certificates in suit, after they had been redeemed according to law, were canceled by the proper officers, by distinctly stamping in ink across the face words stating that fact, and in that condition were made up in bundles and put away on a shelf, whence they were afterwards stolen by a clerk, who had no duty or authority connected with their redemption or care, and who afterwards fraudulently effaced the marks of cancellation, by the use of detersive soap, and by pasting coupons over them, and then put the certificates in circulation. The provision of the Act of Congress of March 3, 1875, chap. 162, § 16, by which certain officers of the District of Columbia are required to destroy by burning all redeemed certificates, is in terms and effect merely directory, and does not make the District liable on such certificates fraudulently put in circulation, after they have been otherwise unmistakably canceled. 18 Stat. at L. 505. These certificates having been lawfully extinguished by stamping across their face marks [661] of cancellation as clear and permanent as the original signatures, the liability of the District upon them as negotiable paper could not be revived by its omission to take additional precautions against their being stolen and fraudulently restored to their original condition by such means as ingenious wickedness might devise. Moreover, these certificates were in no sense money or the equivalent of money. Though negotiable instruments, they belonged to a peculiar class of such instruments, being made by a municipal corporation, and having no validity unless issued for a purpose authorized by law, and as to which this court has repeatedly laid down and acted on the following rule: "Vouchers for money due, certificates of indebtedness for services rendered, or for property furnished for the use of the city, orders or drafts drawn by one city officer upon another, or any other device of the kind, used for liquidating the amounts legitimately due to public creditors, are of course necessary instrumen for carrying on the machinery of municipal 565] [566] administration, and for anticipating the collec- General Assembly of Florida, approved Janu- Considering the nature of these certificates, ment Fund of the State of Florida." The gen- THE UNION TRUST COMPANY OF NEW Governor, the comptroller, treasurer, attorney YORK, Appt., v. THE SOUTHERN INLAND NAVIGA- (See S. C. Reporter's ed. 565-572.) Deed, made in violation of injunction--lis general, and register of state lands, and their successors in office, in trust to dispose of the same and invest their proceeds, with power to pledge the fund for the payment of the interest on the bonds (to the extent of $10,000 per mile) which might be issued by any railroad companies constructing roads on certain lines indicated by the Act. The companies, after compen-pleting their roads, were to pay, besides interest on their bonds, one per cent per annum on the amount thereof, to form a sinking fund for the ultimate payment of the principal. The Act declared that the bonds should constitute a first lien or mortgage on the roads, their equipment and franchises; and upon a failure on the part of any railroad company accepting the Act to provide the interest and the payments to the sinking fund as required thereby, it was made the duty of the trustees to take possession of the railroad and all its property, and advertise the same for sale at public auction." In the same case it was said that the trustees are mere 1. A deed, made in violation of an injunction, previously issued and served, is subject to the decree subsequently rendered, in the suit in which the injunction was granted. 2. All persons dealing with property are bound to take notice of a suit pending with regard to the title thereto, and will, on their peril, purchase the same from any of the parties to the suit. 3. A lis pendens, duly prosecuted, and not collusive, is notice to a purchaser so as to affect and bind his interest by the decree; and the lis pendens begins from the service of the subpena after the bill is filed. 4. A decree, although erroneous but not void, 1889. ly agents of the State, invested with the legal title of the lands for their more convenient administration; and that the State remains in every respect the beneficial proprietor, subject to the guaranties which have been made to the holders of railroad bonds secured thereby. See also Florida Cent. R. Co. v. Schutte, 103 U. S. 118 [26: 327]; Littlefield v. Improvement Fund TrusDecided April 22, tees, 117 U. S. 419 [29: 930]; Vose v. Reed, 1 Woods, 647; Vose v. Trustees of Improvement Fund, 2 Woods, 647. APPEAL from a decree of the Circuit Court of The facts are stated in the opinion. Mr. Wayne MacVeagh for appellees. This suit arises out of certain transactions On the third of November, 1870, Francis Vose brought a suit in equity in the Circuit Court of the United States for the Northern District of Florida, against said trustees and others. Among the defendants were the Florida Canal and Inland Transportation Company, the Southern Inland Navigation Company (described in some parts of the bill and in some of the interrogatories annexed as the Southern Inland Navigation and Improvement Company), the New York and Florida Lumber, Land and Improvement Company, and M. S. Mickles, agent of the last named company. The object of that suit was to obtain an injunction and decree protecting the Internal Improvement Fund against waste and misappropriation by the trustecs, to the injury of Vose and others, who held unpaid bonds issued by the Florida Railroad 67 1043 [567] [568] Company in conformity with the Act of 1855. | contracted to be conveyed shall be restored to and is to be selected from the most valuable of On the 6th of December, 1870, the circuit On the 6th of February, 1871, an order was made reciting the service of subpena in chancery upon the "defendants" in conformity with the rules and practice of the court, and the bill was taken for confessed (except as to the defendant Walker) for want of an answer, plea or demurrer. The Trustees of the Internal Improvement Fund subsequently appeared and were permitted to file their answer, controvert[569] ing the principal allegations of the bill. On the 10th of February, 1871, four days after the bill had been taken for confessed, a majority of the trustees, "for and in the consideration of the sum of one dollar to them in hand paid," conveyed to the Southern Inland Navigation and Improvement Company one million three hundred and sixty thousand six hundred acres of land; and, shortly thereafter, March 20, 1871, the latter company mortgaged the above and other lands obtained from the trustees of the Internal Improvement Fund, to secure the payment of bonds for a very large amount which the mortgagor company proposed to is The present suit was instituted April 12, 1883, by the Union Trust Company of New York, against the Southern Inland Navigation and Improvement Company and the Trustees of the Internal Improvement Fund. Its object is to obtain a decree adjudging that the said trustees have no right, title or interest in the lands embraced in the mortgage of February 10, 1871; that the same are subject to said mortgage; and that the property so mortgaged be sold to pay the amount found to be due upon any outstanding bonds secured by that mortgage. The principal defense rests upon the above proceedings, orders and decrees in the Vose suit. The bill was dismissed with costs, and from the decree of dismissal the present appeal was prosecuted. The argument at the bar covered several sue. notice of a suit pending with regard to the title [570] [571] to that fund the lands conveyed, or attempted nor to articles of ordinary commerce sold in Err., v. veyance of the lands in question from the THE KAW VALLEY RAILWAY AND Trustces of the Internal Improvement Fund, It is, however, suggested that the Southern Inland Navigation and Improvement Company was not a party to the Vose suit, and consequently was not bound by that part of the decree of December 4, 1873, adjudging that the contracts or agreements entered into by the trustees with that company "be rescinded, and the same are declared null and void, and the lands undertaken to be conveyed, or contracted to be conveyed, shall be restored to the said Internal Improvement Fund, and be subjected to sale by the agents appointed by the court.' To this suggestion there are two answers: First. The question whether the Southern Navigation and Improvement Company was a party defendant to the Vose suit, and therefore affected by the decree pro confesso, passed February 6, 1871, was determined adversely to it by the order of March 26, 1877, denying its application to have the order of December 4, 1873, set aside. From the order of March 26, 1877, no appeal was prosecuted; and in this collateral proceeding that order is to be taken as conclusively establishing the fact that the Southern Inland Navigation Company was a party to the Vose suit, was served with process of subpena therein, and neglected to appear and answer the bill. Second. The relief granted in the Vose suit in respect to the agreement or IMPROVEMENT COMPANY. (See 8. C. Reporter's ed. 559-565.) Lands taken for railroad in Kansas-sufficiency 1. A notice, given by commissioners appointed to 3. The owner of real estate who is a nonresident, of the State within which the property lies, cannot evade the duties and obligations which the law imposes upon him in regard to such property by his absence from the State. 4. It is the duty of the owner of the real estate 6. The objection that one of the commissioners [No. 230.] Argued April 1, 2, 1889. Decided April 22, 1889. contracts which the Southern Inland Navina IN ERROR to the Circuit Court of the Unit tion and Improvement Company claimed to have with the Trustees of the Internal Improvement Fund was within the general scope of [572] that suit, and was fairly covered by the prayer for such relief as might be deemed just and equitable. Besides, if that company was a party to the Vose suit, and we have seen that it was, the decree, so far as it rescinds the agreement or contracts it bad with the trustees, and restores to the Internal Improvement Fund the lands covered by these contracts, was not void. If erroneous, it could only be avoided by an appeal. It cannot be questioned in this collateral proceeding. It results from what has been said that the conveyance by the trustees to the Southern Inland Navigation Company was subject to such decree as the court might render in the Vose suit; and as the decree of December 4, 1873, rescinded the agreements which the latter had with the former in respect to lands con stituting a part of the trust fund, and restored ed States for the District of Kansas, to review a judgment for defendant in an action against a railway company to recover for the value of land taken for its right of way and for damages incident to the taking. Affirmed. The facts are stated in the opinion. Messrs. Albert Young and Eppa Hunton, for plaintiffs in error: The pretended notice lacks all the elements necessary to afford information to the parties affected, and is no notice and void. 2 Story, Eq. Jur. § 400; Vail v. Morris & E. R. Co. 21 N. J. L. 189; Chicago & A. R. Co. v. Smith, 78 III. 98; Re New York Cent. & H. R. R. Co. 70 N. Y. 191; Clark v. Elizabeth, 37 N. J. L. 120; State v. Plainfield, 38 N. J. L. 95; Strang v. Beloit & M. R. Co. 16 Wis. 635; State v. Perth Amboy, 29 N. J. L. 259; Peoria & R. 1. R. Co. v. Warner, 61 Ill. 52; 2 Desty, Taxn. 826; Eastman v. Little, 5 N. H. 290; Farnum v. Buffum, 4 Cush. 260; Kitsmiller v. Kitchen, 24 Iowa, 163; Corbin v. Young, 24 Kan. 198. The notice is not "due process of law |