Appeal and Cross-Appeal from the District Court of the United States for the District of Oregon; Robert S. Bean, Judge.

Suit in equity by the United States against the Booth-Kelly Dumber Company, Stephen A. Da Raut, Alice Da Raut, Ethel M. Da Raut, and Ducy Da Raut. From the decree, both the United States and defendant Dumber Company appeal.

On May 24, 1910, the¡ United States brought a suit in the court below to cancel five patents of land which had been issued under the Timber and Stone Act, on the ground that the initial applications of the patentees hart been fraudulently made by them for the use and benefit of the Booth-Kelly Lumber Company, and with the understanding at the time when they were made that the entrymen should each convey the laud so entered by him to said company. The bill alleged that that company paid and advanced all of the fees, costs, and expenses and purchase price of said land, and paid to each entryman $100, and received from each a deed. The entrymen were Edward Jordan, Stephen A. La Rant, Alice La Raut, Ethel M. La Raut (now Ethel M. Lewis), and Lucy La Raut, and they were made eodofendants with the Booth-Kelly Lumber Oompanj*. A decree was taken pro eonfesso against Jordan. On September 21, 1910, all the other defendants answered the bill, denying that the Lumber Company furnished any of the purchase money, fees', costs, or expenses of acquiring the land, and denying the allegations of fraud on the Timber and Stone Act. The answer alleged i that on or about July 22, 1902, the Lumber Company purchased the land entered by Jordan for the sum of $550, which was actually advanced and paid to and for his use and benefit, and received a warranty deed from him therefor, relying upon the final receipt for said land, and believing that all the proceedings anterior thereto were bona fide, etc.; that on May 7, 1907, Stephen, Alice, Ethel, and Lucy La Raut, by virtue of the patents issued to them, wereseised and possessed of full legal and equitable ownership of the land granted by said patents, and that on said day the Lumber Company purchased the land described in said patents, and each of the patentees received therefor the sum of $600, which sum was actually advanced and paid to and for each of them, relying upon the patents, etc. And there is in the answer this allegation by the Lumber Company: “That this defendant is informed and believes, and therefore alleges, that after the said entries mentioned in said bill were made by said several entrymen, charges were made and filed with the complainant’s officials in the Interior Department, whose duty it was to investigate and determine the same, that said entries were fraudulent in character, and were made for the benefit of this defendant, and that said charges were fully investigated by the Inferior Department for the purpose of ascertaining the truth or falsity of said charges, and to determine whether patents should be issued upon said entries, or whether the same should be canceled, and that such proceedings were had in said matters that said several entries were fully investigated, by complainant’s officials charged with that duty, and testimony and affidavits were taken upon said investigation, and the complainant and said entrymen were duly represented at said hearing and investigation, and that upon a full investigation and hearing upon said charges, and with full knowledge of all the facts, it was found and determined by the said officials that said entries were not fraudulent, and that the irregularities in said entries, if any, were not of sufficient gravity to require or justify the cancellation of said entries, and ordered that patents issue upon said entries for said land, and that patents were thereupon issued therefor, as alleged in said bill of complaint.” After a replication had been filed, and at the beginning of the taking of testimony before an examiner, on December 19, 1910, the Lumber Company, Lucy La Raut, and Ethel M. La Raut obtained permission to amefid their answer, “so as to admit that the defendant the Booth-Kelly Lumber Company is the holder of the legal title to the lands entered by and patented to Ethel M. La Raut and Lucy La Raut, but denying that it is the equitable owner of said land, and alleging affirmatively that said Ethel M. La Raut, now Ethel M. Lewis, and Lucy La Raut, ever since said patents were issued to them, have been and now are the equitable owners of said land, and that the deeds made by them to the Booth-Kelly Lumber Company were intended to be and were in fact mortgages to secure the payment of certain advances made and to be made to them by said company, to enable them to enter and pay for said land •and for other purposes.” On the issues so made, and the teotimony, tne court below entered a decree canceling the patent which had been issued to Jordan and dismissing the bill as to the other entries. From that decree both the complainant and the Lumber Company have appealed.