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demand of the complainant. They have gradually increased their diversions, and just at what point they encroached upon the rights of the complainant and the intervener cannot be determined from the testimony, and just how long it has continued cannot be ascertained; but it is clear that they did not do so to any considerable extent until after the year 1893, and this suit was brought in 1903. As to real estate the possession is easily discovered. It is susceptible of actual proof, but here it is not shown that either the complainant or intervener were ever entirely deprived of water. During the flood time water always reached them. They had the use of it for a time, some years longer than others. Who can divine with definiteness just what amount of water the defendants used to the exclusion of the complainant or intervener, or how long it was used to their exclusion each year? The burden is upon the defendants to bring themselves within the statute, and the proof must be clear before a prescriptive right will be enforced. The claim cannot prevail under the conditions disclosed. Last Chance Ditch Co. v. Heilbron (Cal.) 26 Pac. 523; Fogarty v. Fogarty (Cal.) 61 Pac. 570; Boyce v. Cupper (Or.) 61 Pac. 642; Huston et al. v. Bybee (Or.) 20 Pac. 51; Long on Irrigation, $$ 90–91–92.

4. Abandonment. The statute of Wyoming provides, in effect, that failure of one to use water appropriated for a period of two years shall be construed as an abandonment, and the defendants would avail themselves of its provisions. If it be admitted that their unlawful diversions deprived the appropriators in that state from the use of the water for more than this period, yet cessation of its use because it did not reach the parties entitled to it does not work an abandonment. Evidently that, in contemplation by the Legislature, was a voluntary act, and not an enforced discontinuance. An abandonment must always be voluntary. The statute could not have been intended to apply to anything more than failure to use from an available supply, and in its application it must be construed in the light of the well-known meaning of the words employed to express the legislative will.

5. Estoppel and laches. It is safe to say that few cases of this character have been tried where the defense of estoppel has not been interposed with result uniformly unsuccessful. The estoppel argued for here is that the parties now seeking to assert their rights ought not be allowed to do so, because they knew that the defendants were building up their improvements, and relying upon the use of the water to maintain them. An all-sufficient answer to this is that the defendants knew also that the complainant and intervener were relying upon the same water to maintain their improvements already made, and to carry on their farming operations already begun. Under this view of it, the one side is as much estopped as the other.

What is it that the appropriators in Wyoming have concealed which has misled the defendants to their prejudice? An estoppel of this character is based upon fraud—the inequity of asserting a right after having by silence misled a party by concealing facts which were unknown to him. Here they were equally known to both parties, hence the case does not present elements upon which an estoppel can be founded. Nor can it be successfully contended that the moving parties in this controversy have been guilty of laches. The intervener has been in the courts more than once, attempting to restrain the defendants, and the complainant has protested while the supply of water grew less from year to year, until finally his ills became unbearable. There is no principle of estoppel which can aid the defendants, nor can they invoke the doctrine of laches. Galliher v. Cadwell, 145 U. S. 368, 12 Sup. Ct. 873, 36 L. Ed. 738; Smyth v. Neal (Or.) 49 Pac. 850; Boggs v. Mining Co., 14 Cal. 368; Water Supply & Storage Co. v. Tenney (Colo. Sup.) 51 Pac. 505; Lower Latham Ditch Co. v. Louden Irrigating Canal Co. (Colo. Sup.) 60 Pac. 629, 83 Am. St. Rep. 80; Lux v. Haggin, 69 Cal. 255, 10 Pac. 674; Bathgate v. Irvine (Cal.) 58 Pac. 413, 77 Am. St. Rep. 158; Rigney v. Tacoma Light & Water Co., 9 Wash. 577, 38 Pac. 147, 26 L. R. A. 425.

6. The equities. Defendants claim that it is inequitable, to use the language of their counsel, “to lay barren and waste the lands of defendants in Montana that two farms in Wyoming may be supplied with water.” This may appeal to state pride and local bias, but the contention disregards the maxim that he who is first in time is strongest in right, which is the very essence of the doctrine of appropriation. An appropriator is entitled to the water used by him to the fullest extent as against all persons subsequently claiming. Complainant and intervener in this case found certain natural conditions. There was a running stream upon the public lands, supplied from the snows of the Pryor Mountains. It afforded water sufficient for their purposes. The arid lands near and adjoining which were subject to settlement invited its use. Their needs as farmers required it. They took advantage of the benefits which the laws guarantied and which the conditions made available; hence the plea on behalf of the defendants that the creek goes dry every year, and did prior to their settlements, is not a defense, though it might, for the purposes of this decision, be admitted without aiding them. If the creek goes dry every year, it is because of the shortage of the supply above. It must be assumed that if no snow fell in the Pryor Mountains in any given year, that the water would perhaps not flow into Wyoming; that if this condition continued for several years the water would cease entirely to flow, even to the lands of the defendants, because the supply comes almost entirely from the snowfall. This is illustrative of what must necessarily be true; that is, the greater the fall of snow the more water. This is also true, that the more water which finds its way into the creek the greater will be the flow, and of course the more water that is diverted the less will be the supply. The appropriators took with the right to have the the stream continue to flow as it was wont to flow, and to remain in the condition in which they found it, and whenever water is diverted above it keeps back that which would otherwise reach them, and the more water that is kept back the less will the complainant and intervener have. But for the wholesale diversions by defendants the water would reach them later in the season, and abide longer, and this is what their appropriations entitle them to. In the abstract there would be more people benefited by allowing the defendants to take all the water. Its flow through a sandy and gravelly stretch of something like eight or ten miles, and perhaps farther, is, in a measure, a waste, but equity does not consist in taking the property of a few for the benefit of the many, even though the general average of benefits would be greater. It can no more ignore well-defined legal rights than it can go in the face of a positive statute. Then, again, the theory of the defendants cannot be accepted. The witnesses perhaps have told the truth, but not the whole truth. That the water would not reach one lower down the stream is quite a common defense. It is often urged in irrigation suits by trespassers as a justification for their invasion of the rights of others. It is probably as old as irrigation and perhaps as trespass itself. In this case failure of the water to reach the complainant and intervener was co-incident with its use by the defendants. The fact that witnesses saw in the varying changes of the seasons a shortage of water at different points on the stream does not explain the whole situation; in other words, in one extremely dry season perhaps the water was lower than in another. It varies, and it varies because of the shortage of the supply above, and these defendants retarded its flow by reason of their diversions, which decreased the supply to that extent which prevented it from reaching Wyoming at all; and when the supply is diminished by the light snowfall the diversion of the defendants increases the shortage, and that is an invasion of the rights of the appropriators who are seeking the enforcement of their priorities in this suit.

7. Damages. No damages other than nominal can be recovered. The defendants did not act jointly. Each claimed individually. There was no community of action. It would not be proper to charge all or either of them with damages at the option of the injured parties, as in the case of a joint undertaking in tort, because their acts were not committed in pursuance of the same common purpose, although they produced the same general result.

8. Extent of the rights of complainant and intervener. The complainant and intervener, respectively, constructed ditches of sufficient capacity to irrigate the whole of their lands. The finding must be that they increased their cultivated area with reasonable diligence, particularly in the light of the unlawful diversions made by the defendants.

The master found that the intervener, Howell, had appropriated and was entitled to the use of 110 inches of water, miner's measure, for the irrigation of his 200 acres, which finding will be sustained. He did not find as to the amount diverted and used by the complainant. Upon that the finding will be that complainant is entitled to water for the irrigation of his 160 acres at the same ratio. Under the issues tendered, the priorities of the defendants as between themselves cannot be adjudged, nor can their prayer that those priorities be fixed, for the purpose of restraining them in the order of the date of their several appropriations.

Findings will be made in accordance with the views herein expressed. The exceptions taken by the defendants will be overruled in so far as they conflict herewith. The decree will enjoin the defendants from diverting the water of Sage and Piney creeks to the prejudice of the parties found to be entitled to the same as prior appropriators, and costs will follow the decree.



(Circuit Court, N. D. Iowa, Cedar Rapids Division. July 21, 1906.)

No. 192.



Code Iowa 1897, § 1637, requires foreign corporations doing business within the state to file copies of their articles of incorporation with the Secretary of State, and otherwise comply with the law relating to domestic corporations, etc.; but section 1636 declares that no person or persons acting as a corporation shall be permitted to set up a want of legal organization as a defense to any action against it, nor shall any person sued on a contract made with such corporation be permitted to set up a want of such legal organization in his defense. Held that, where a foreign corporation was acting as a corporation in Iowa at the time it made the contract sued on with defendant, it was no defense to an action thereon that plaintiff had not complied with section 1637.

[Ed. Note.--For cases in point, see vol. 12, Cent. Dig. Corporations, $$

2561-2563.] 2. SAME.

A defendant sued by a corporation on a contract made with it cannot question the right or authority of the corporation to make the contract or to transact business in the state in which the contract was made; such question being within the exclusive province of the state.

[Ed. Note.-For cases in point, see vol. 12, Cent. Dig. Corporations, $$


In a direct action by a state to oust a foreign corporation from doing business therein without complying with the state law regulating foreign corporations, judgment of ouster will not be awarded if the corporation complies with such law within a reasonable time. Albrook & Lundy, for plaintiff. Healy Bros. & Kelleher, for defendant.

REED, District Judge. The plaintiff, a corporation of Canada, sues defendant upon its bond given to plaintiff, guarantying the fidelity of its secretary, alleging that said secretary breached the conditions of the bond by embezzling a large amount of plaintiff's money. The deferdant in one count of its answer alleges that plaintiff has never complied with sections 1637, 1638, and 1639, Code Iowa 1897, which require foreign corporations who desire to do business in that state to file in the office of the Secretary of State a copy of their articles of incorporation, and procure from said Secretary a permit to transact business in that state; that the business and transactions alleged in the


petition to have given rise to the alleged cause of action against defendant were carried on and transacted in Iowa by the plaintiff in violation of said sections. The plaintiff demurs to said count of the answer. The sections of the Code above named are a part of the general incorporation laws of the state of Iowa, and provide as follows:

"Sec. 1637. Any corporation for pecuniary profit, other than for carrying on mercantile or manufacturing business, organized under the laws of another state, * * * or of any foreign country, which * * * desires hereafter to transact business in this state.

shall file with the Secretary of State a certified copy of its articles of incorporation duly attested, accompanied by a resolution of its board of directors or stockholders authorizing the filing thereof, and also authorizing the service of process to be made upon any of its officers or agents in this state engaged in transacting its business, and requesting the issuance to such corporation of a permit to transact business in this state; said application to contain a stipulation that such permit shall be subject to the provisions of this chapter. Before such per. mit is issued the said corporation shall pay to the Secretary of State the same fee required for the organization of corporations in this state.

The Secretary of State shall thereupon issue to such corporation a permit, in such form as he may prescribe, for the transaction of the business of such corporation, and upon the receipt of such permit said corporation shall be permitted and authorized to conduct and carry on its business in this state. Nothing in this section shall be construed to prevent any foreign corporation from buying, selling and otherwise dealing in notes, bonds, mortgages, and other securities.

“Sec. 1638. No foreign corporation which has not in good faith complied with the provisions of this chapter and taken out a permit shall possess the right to exercise the power of eminent domain, or exercise any of the rights and privileges conferred upon corporations until it has complied herewith and taken out such permit.

"Sec. 1639. Any foreign corporation that shall carry on its business in violation of the provisions of this chapter in the state of Iowa, without having complied with this statute and taken out and having a valid permit, shall forfeit and pay to the state for each and every day in which such business is transacted and carried on, the sum of one hundred dollars to be recovered by suit in any court having jurisdiction; and any agent, officer or employé who shall knowingly act or transact such business for such corporation, when it has no valid permit as provided herein, shall be guilty of a misdemeanor, and for such offense shall be fined not to exceed one hundred dollars, or be imprisoned in the county jail not to exceed thirty days, or by both such fine and imprisonment. * * * All foreign corporations, and the officers and agents thereof, doing business in this state shall be subject to all the liabilities, restrictions and duties that are or may be imposed upon corporations of like character organized under the general laws of this state, and shall have no other or greater powers."

Among the powers of such corporations are the following: “(2) To sue and be sued by its corporate name.

* (6) To make contracts, acquire and transfer property, possessing the same powers in such respects as natural persons.

Code $ 1609. It is not affirmatively alleged that the bond in suit was made to plaintiff in Iowa, but in argument it has been assumed that it was, and that the matters alleged in the petition as constituting a breach thereof arose out of business transactions of the plaintiff in that state. It may be conceded that the state may by statute lawfully prescribe the conditions upon which it will permit foreign corporations not engaged in interstate commerce to transact business therein, and prevent them by proper action from doing so until


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