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Hilgeford v. Peoples Bank

*fn*: October 31, 1985.


Appeal from the United States District Court for the Northern District of Indiana, Fort Wayne Division. No. 85 C 154-William C. Lee. Judge.

Before WOOD, CUDAHY, and EASTERBROOK, Circuit Judges.

Per Curiam.

Pro se plaintiffs-appellants Arnold and Martha Hilgeford (the Hilgefords) commenced a quiet title action against their mortgagee, The Peoples Bank (the Bank), claiming that their "federal land patent" gave them superior title to certain real estate over the Bank's interest. The Bank had apparently made a loan to the Hilgefords, secured by a mortgage on the Hilgefords' property. This mortgage was subsequently foreclosed and the property sold to satisfy the debt when the Hilgefords defaulted on the loan. The land patent upon which the Hilgefords assert a superior interest was drafted and signed by them, and recorded after the Hilgefords mortgaged their property in favor of the Bank, but apparently before the state foreclosure proceedings commenced. The Hilgefords seek to have title to the property and the interests of the parties determined by the court, and the Bank enjoined from asserting any rights in the land. No diversity of citizenship was alleged, rather jurisdiction in the district court is predicated on the existence of a federal question.*fn1 28 U.S.C. § 1331. The district court sua sponte dismissed the suit for lack of subject matter jurisdiction and imposed a fine of $250.00 as a sanction pursuant to Federal Rule of Civil Procedure 11.*fn2 Hilgeford v. Peoples Bank, 607 F. Supp. 536, 539 (N.D. Ind. 1985). The Hilgefords appeal.

On appeal, the Hilgefords have submitted a two-page brief containing a jurisdictional summary along with their argument that a land patent from the United States government is absolute and immune from collateral attack. While this court may hold a pro se litigant's briefs to a lower standard than those prepared by counsel, McCottrell v. E.E.O.C., 726 F.2d 350, 351 (7th Cir. 1984), the Hilgefords' brief is woefully inadequate. However, it is sufficient, along with the record, for us to determine the jurisdictional question, the only issue on appeal.

The Hilgefords premise jurisdiction on the existence of a federal question by reason of their land patent, 28 U.S.C. § 1331,*fn3 specifically asserting that the action arises under article IV, section 3, clause 2 of the United States Constitution*fn4 and an 1820 Act of Congress, 3 Stat. 540.*fn5 It is well settled, however, that a controversy regarding land has never been regarded as presenting a federal question simply because one of the parties to it has derived his title from a patent or under an act of Congress. See, e.g., Oneida Indian Nation v. County of Oneida, 414 U.S. 661, 676, 39 L. Ed. 2d 73, 94 S. Ct. 772 (1974); Shulthis v. McDougal, 225 U.S. 561, 570, 56 L. Ed. 1205, 32 S. Ct. 704 (1912); Joy v. city of St. Louis, 201 U.S. 332, 342-43, 50 L. Ed. 776, 26 S. Ct. 478 (1906); State of Wisconsin v. Baker, 698 F.2d 1323, 1327 (7th Cir.), cert. denied, 463 U.S. 1207, 77 L. Ed. 2d 1388, 103 S. Ct. 3537 (1983); Standage Ventures, Inc. v. State of Arizona, 499 F.2d 248, 249 (9th Cir. 1974); Heirs of Burat v. Board of Levee Comm'rs, 496 F.2d 1336, 1339 (5th Cir.), cert. denied, 419 U.S. 1049, 42 L. Ed. 2d 644, 95 S. Ct. 625 (1974); Kirklin v. Ellerbe, 278 F. 168 (5th Cir. 1922).

Only if federal law continues to govern the right ... or if the suit is to decide whether the United States did, in fact, originally convey it ... does an action to enforce that right "arise under" federal law. "The federal nature of the right to be established is decisive-not the source of the authority to establish it."

State of Wisconsin v. Baker, 698 F.2d at 1327 (citations omitted).

Neither the federal constitutional and statutory provisions cited, nor the existence of title derived from a land patent raises a sufficient federal claim or issue upon which to base the jurisdiction of the district court. The instant case does not require the interpretation or construction of these alleged bases of jurisdiction. Rather, the action involves only mortgage foreclosure, proper for state court determination, not federal court. Land title and possessory actions are generally not the business of federal courts, e.g., White v. Burnley, 61 U.S. (20 How.) 235, 15 L. Ed. 886 (1857); Beauregard v. New Orleans, 59 U.S. (18 How.) 497, 15 L. Ed. 469 (1855), and this case is no exception.*fn6

Finally, the district court's imposition of sanctions under Rule 11 will be upheld absent an abuse of discretion. Frazier v. Cast, 771 F.2d 259, slip op. at 6 (7th Cir. 1985); In re TCI Ltd., 769 F.2d 441, 448 (7th Cir. 1985). The Hilgefords fail to enumerate how the district court abused its discretion or to even argue the issue in their appellate brief.

Under Federal Rule of Appellate Procedure 38, we may award damages, including attorney's fees, and costs if an appeal is both frivolous and an appropriate case for the imposition of sanctions. See Trecker v. Scag, 747 F.2d 1176, 1179 (7th Cir. 1984), cert. denied, 471 U.S. 1066, 105 S. Ct. 2140, 85 L. Ed. 2d 498 (1985); Reid v. United States, 715 F.2d 1148, 1154-55 (7th Cir. 1983). The conclusion that this appeal is frivolous seems inescapable. The drafting and recordation of the Declaration of Land Patent was a blatant attempt by the Hilgefords to circumvent the Bank's mortgage and improve their title. The district court informed them twice within a month's time that this device did not improve their title or form the basis for federal jurisdiction. On appeal, the Hilgefords have completely failed to support their claim of jurisdiction by citing relevant authority or by refuting the district court's analysis.

Our review of the briefs and record persuades us that this is vexatious litigation; an appropriate case for the imposition of sanctions. The Hilgefords have no support for their claims of superior title or federal jurisdiction. Their brief was also woefully inadequate. We can think of no other reason for this appeal other than delay, harassment, or sheer obstinancy. Reid, 715 F.2d at 1155. Accordingly, we award the Bank $500 in damages for this frivolous appeal in addition to the costs allowed by Federal Rule of Appellate Procedure 39.

The judgment of the district court ...

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