What is the test for dismissing an action under section 3 of the Act of March 3, 1875?

In Barry v. Edmunds, the court concluded: 'The section of the act of March 3, 1875, under which the circuit court acted in dismissing the present action confers a beneficial authority to be wisely exercised in defeating collusive and fraudulent experiments upon its jurisdiction; but the discretion it confers is judicial, proceeding upon ascertained facts according to rules of law, and subject to review for apparent errors.' (Id., p. 566, 62 S.Ct. p. 510.)