Lehigh Zinc & Iron Co. v. Trotter

43 N.J. Eq. 185

Opinion

The opinion of the court was delivered by

Deptje, J.

The decree in the original suit upon the remittitur was entered in the court of chancery May 4th, 1886, and on the 6th the-company took possession of the mine. On the same day Trotter gave notice that all inability or failure to furnish ore under said contract had been removed, and demanded that possession of the premises should be delivered back to him. The company having refused to surrender possession, Trotter thereupon, August 24th, 1886, filed the present bill. The object of the bill is to obtain by a decree of the court the restoration of the premises to the-complainant. On final hearing in the court of chancery it was decreed that by the true construction of the agreement the complainant was entitled to a return of possession so soon as his inability or failure to supply the ore mentioned in the agreement was satisfactorily- removed, and that, such inability and failure-having been removed, the possession of the said mine, together- with the machinery, tools &c., should be redelivered to the complainant. From this decree the defendants appealed.

Trotter, in virtue of his leasehold estate, is the owner of .the mine in question. As an incident of his ownership he is primarily entitled to the possession of the premises and to the use and enjoyment of the same, to work the mine in such a manner as would conduce to his own interests. He contracted to mine and deliver to the company, on cars at Franklin, the ore taken from the mine, in certain monthly quantities specified in the agreement. To secure to the company a regular supply of ore, in the quantities and at the times set out in the agreement, power and authority were conferred upon the company to enter into and upon the mines and premises, to inspect and examine the same, and provide, if necessary, such protection and security for them and their proper workings as to the company should seem fit and proper, and also the free and uninterrupted right and privilege to enter into and upon said premises and any and all parts thereof, and to take therefrom and apply to their own use the amount of ore specified in the agreement in case Trotter should fail, for thirty days, to deliver the monthly quantities of ore stipulated — charging Trotter with the cost of mining and delivering upon the cars — with the privilege and right, during such occupation and working of the mine, to employ the workmen employed by Trotter, or to dismiss them and employ others, and also to take possession of and use the machinery, tools &c. belonging to Trotter which were required to be used in connection with the mine and works.

The agreement evinces no intent to assign Trotter’s leasehold estate to the company in any event. The operative words are “ right and privilege ” to enter upon and work the mine and take therefrom ore at Trotter’s expense, to be applied in fulfillment of his contract. The purpose the parties had in view in adopting such a provision was to insure the supply of ore in regular monthly quantities which were necessary to the operation of the company’s works. During the company’s possession of the mine Trotter would be deprived of the advantage of selecting and overseeing the workmen employed and of supervising the expenses of mining and loading the ore, and especially of the advantage which would ensue from directing how the mine should be worked and the ore be delivered under the contract. The sliding scale of prices above and below the standard of twenty-six per cent, fixed by the contract exhibits a striking illustration of the benefit Trotter would have in controlling the working of the mine and selecting the ore for the monthly shipments. It is obvious that the parties contemplated that the privilege granted to the company of exercising those rights which naturally belong to Trotter as the owner of. the mine, and as the party who had contracted to mine and deliver the ore, should subsist so long only as the exercise of such a right was necessary to effectuate the purpose the parties had in view in making this provision part of their agreement. The period of the duration of this “ right and privilege ” is defined in the agreement to be “ until the inability or failure of the said Charles W. Trotter to supply said ore as agreed upon shall be satisfactorily removed.”

The contract gave the company the right to the possession of the mine; to work the same if from any cause Trotter should fail for thirty days to deliver ore in conformity with the terms of the agreement. It also gave to Trotter the right to possession again in case his inability or cause of such failure should be removed. This was the construction of the fourth subdivision of the agreement adopted by the vice-chancellor. It is the construction put upon it by the defendants in the cross-bill filed by them in the former case. It is the construction which conforms to the language of the agreement, and also gives effect to the intention of the parties as disclosed by their contract taken as a whole.

Nor is it made apparent that Trotter has by his own conduct forfeited his rights under the contract. His refusal to deliver ore in accordance with the terms of the agreement, which gave rise to the former litigation and to the company’s right to have possession, was due, in a great measure, to his misconstruction of terms of the contract obscurely expressed with respect to the manner of assaying the ore, and a misapprehension of his legal right to withhold delivery for the reason that ore delivered had not, as he construed the agreement, been paid for as prescribed by its terms. The vice-chancellor in the former decree sus-r tamed his contention and decreed in his favor. In this court, both parties were found in fault — the company, in not making payment for ores delivered, as required by its contract (a default which was due to mistakes in analyzing the ores and to the indefiniteness of the contract with regard to the price of ore below the standard); — Trotter, in assuming that neglect to pay for ores in strict compliance with the terms of the agreement gave him the right to refuse to go on with the delivery of ore. In the controversies which culminated in this litigation, the parties have been in dispute as to the construction of the agreement, and since the dispute began each has shown a purpose to grasp every legal right conferred by the agreement; but there is no ground for the conclusion that either party intended to repudiate the contract. There might possibly be circumstances which would induce a court of equity to deny to Trotter the possession of the mine, but a case requiring such a measure of redress has not been presented. The rights of the parties in the premises rest upon contract. The contract, which by one of its terms gave the company a right to possession of the mine in case of Trotter’s failure for thirty days to deliver ore as he had agreed to do, by another term gave Trotter a right to have possession again when his inability, or the cause of his failure to supply ore as agreed upon, should have been removed. Trotter, in this bill, declares his willingness to go on with the delivery of ore as he had agreed to. He also avers his ability to do so. On that subject, the proof furnished by the schedule of deliveries from April, 1882, to May, 1886, is entirely satisfactory. Indeed, the defendants, in their answer, admit the complainant’s ability to furnish ore in the quantity and of the quality required by the contract. They put their defence to this proceeding on the ground of a forfeiture by Trotter of his right of possession by reason of his willful and deliberate failure and refusal to deliver any ore at a time when there was no physical disability to prevent it — a defence the validity of which is not sustained.

The defendants contend also that the complainant has an adequate remedy at law to recover possession, and that therefore the bill should be dismissed. The rights of the parties with respect to the possession and the working of the mine for the purpose of fulfilling Trotter’s agreement to deliver ore are expressed in the form of a covenant. We do not, at this time, deem it necessary to consider whether Trotter might have a remedy at law, or the form in which the legal remedy should be pursued.

The first bill filed by Trotter was simply an injunction bill to restrain the defendants’ entry. The defendants, not content with an answer to the bill, filed a cross-bill, in which they set up their right to take and hold possession of the mine until the inability or failure of the complainant to supply ore as agreed upon should be satisfactorily removed, and prayed that an order and decree might be made directing them to take possession of the mine, and that an injunction should issue to restrain Trotter from disturbing their possession. In the opinion of this court, which was carried down to the court of chancery with the remittitur, it was declared that the effect of our decree was to dissolve the injunction enjoining the defendants from taking possession of the mine, and to adjudge them to be entitled to the possession thereof, without prejudice to an inquiry, after the defendants had taken possession, into any change of the right of possession from matters arising since the bill was filed. In its decree upon the remittitur the court of chancery recited the decree of this court, together with the explanatory opinion annexed to it.

The court of chancery, in executing the decree of this court, made a decree dissolving the injunction which restrained the defendants from entry and taking possession of the mine. Such a decree would have disposed of the litigation inaugurated by the complainant’s bill. It was the only decree in favor of the defendants which was in this respect within the scope of the complainant’s bill. Such a decree would simply have withdrawn the restraining hand of the court of chancery, and would have left the defendants to enter at their peril or to obtain possession at law. But the court went further. It gave an affirmative decree in favor of the defendants, adjudging that they were entitled to the possession of the mine — a decree enforceable in the manner in which a court of equity enforces decrees establishing a party’s right. To this part of the decree a limitation was annexed that the possession adjudged should be without prejudice to an inquiry, after possession was taken, into any change of the right of possession from matters arising since the bill was filed. It was also made part of the decree that all rights and equities between the parties be reserved, and that either party have the right to apply to the court for further relief. Under this decree the complainant gave up, and the defendants obtained, the possession of the mine.

It is manifest that these proceedings were conducted throughout upon the assumption that the equity court had cognizance of the possession and the change of possession of the mine provided for by the fourth subdivision of the parties’ agreement. The defendants’ cross-bill was filed in that aspect. The decree upon the remittitur was framed upon that idea. Possession of the mine was adjudged to the defendants without prejudice to an inquiry into any change of the right of possession from matters arising after the bill was filed — a mode of trial which imports an investigation in the equity court rather than by suit at law. By the decree all rights and equities between the parties were reserved, and leave was given to either party to apply to the court for further relief. The purpose of the equity court to retain hold of the litigation until inquiry should be made into a subsequent change of the right of possession is exhibited by the decree. The decree is in force,, unappealed from. Whether in strict practice such an inquiry should not have been made upon petition we do not propose to discuss. The vice-chancellor, on the defendants’ motion, dismissed a petition filed by the complainant for that purpose. The dismissal was on the ground that the matter should be brought before the court by a bill. Trotter v. Heckscher, 14 Stew. Eq. 478. In the opinion sent up with this record the bill is treated as a supplemental bill. It is rather an original bill in the nature of a supplemental bill, such as is sometimes brought in aid of a decree, to carry out and give full effect to the decree. Story’s Eq. Pl. §§ 336, 338, 345, 346; 3 Dan. Ch. Pr. 1536, 1573 and notes; Dormer v. Fortescue, 3 Atk. 124, 133; Hodson v. Ball, 1 Phil. 177, 181. As such it is not inappropriate to an investigation of this character. The bill was framed in that aspect. It sets out the proceedings in the original suit and the decree made therein, and avers that after the filing of the original bill all such inability and failure had been satisfactorily removed, and that by reason of said decree demand was made by Trotter that possession be restored to him. If the bill was defective in substance the defendants should have demurred. 2 Dan. Ch. Pr. 1534, 1535. If it was filed irregularly, they should have moved to dismiss, or the court in its discretion might have dismissed it. Barriclo v. Trenton Mutual Life Ins. Co., 3 Beas. 154, 159.

The bill was not demurred to, nor was any motion made to dismiss it. Answers were filed, and in the answers no objection was taken to the complainant’s proceeding by bill, or to the jurisdiction of the court to grant the relief prayed. On the contrary, the company, in its answer, set up a right to retain possession, and set forth in extenso the facts and circumstances on which its claim to retain possession rested, and, in express terms, submitted its rights in the premises to the consideration of the court of chancery. The case was put at issue. Depositions were taken. No objection was made to the mode of procedure, nor to the jurisdiction of the court until final hearing. The objection that the complainant had an adequate remedy at law came too late to avail the defendants. The court, of its own motion, may dismiss a bill at any stage of the cause, on the ground that the complainant has an adequate remedy at law. But where the defendant has not raised the objection until after testimony on the merits has been taken, the court, in its discretion, will retain the cause, if the court is competent to grant the relief prayed, and has jurisdiction of the subject matter. Bates v. Conrow, 3 Stock. 137; Gifford v. Thorn, 3 Hal. Ch. 90; Seymour v. Long Dock Co., 5 C. E. Gr. 396; Cutting v. Dana, 10 C. E. Gr. 265; Palys v. Jewett, 5 Stew. Eq. 302; Parker v. Winnipiscogee Co., 2 Black 545; Cumming v. Mayor of Brooklyn, 11 Paige 596; Clark v. Flint, 22 Pick. 231; 1 Dan. Ch. Pr. 550 and note.

A court of equity will decree possession of real estate as auxiliary relief, but will not make a decree upon the right of pos session, and order possession to be given where the right of possession depends upon a legal question, unless there are special circumstances laying the foundation for equitable interposition. Crane v. Conklin, Sax. 346; Mead v. Camfield, 3 Stock. 38; Miller v. Jamison, 9 C. E. Gr. 41; 2 Spence’s Eq. Jur. 845. Special circumstances may exist to justify a court of equity in exercising jurisdiction over the right of possession. Jurisdiction is not infrequently exercised to decree possession in controversies between trustees and cestui que trust in specific performance, and suits for setting aside deeds of conveyance in partition, and cases of disputed boundaries &c., and orders for possession are often made in foreclosure suits. Harrison v. Rowan, 4 Wash. C. C. 202; Devaucene v. Devaucene, 1 Edw. Ch. 272; 1 Pom. Eq. Jur. § 185; Fackler v. Worth, 2 Beas. 395; Schenck v. Conover, Id. 220. An order of this character, when made by a court of equity, is enforced by writ of assistance, or proceedings for contempt. 8 Dan. Ch. Pr. 1068 and note. Precedents of this mode of procedure are furnished by the practice in suits for the foreclosure of mortgages. Thomas v. De Baum, 1 McCart. 37; Schenck v. Conover, 2 Beas. 220.

In Palys v. Jewett, 5 Stew. Eq. 302, this court retained the cause and proceeded to adjudge a purely legal right, and gave damages thereon against a receiver, upon the scintilla of jurisdiction conferred by the order of the chancellor allowing a suit for such a cause of action to be brought in the equity court. In Gawtry v. Leland, 13 Stew. Eq. 323, this court affirmed sub silentio a decree deciding the complainant’s legal rights in defendant’s lands where the legal remedy was adequate. In N. J. Zinc Co. v. Boston Franklinite Co., 2 Beas. 322-350, Chancellor Green, at the request of parties, entertained jurisdiction over a legal right in lauds, and this court reheard the case on the merits. 2 McCart. 418. In Hart v. Leonard, 15 Stew. Eq. 416, this court, on its own motion, dismissed a bill on that ground, the objection not having been taken by the parties. The party not interposing the objection at the proper time, the matter is in the discretion of the court.

Heckscher, in March, 1883, and after the bill in the original cause had been filed, became, by purchase, the owner of the fee in the mine, subject to Trotter’s rights under the lease. He holds title in the reversion for the benefit of the company. The case shows the advantage that may be taken of Trotter in the selection and combination of ore of different grades of quality in the delivery of ore under the contract. The vice-chancellor comments on that fact in his opinion. As a contracting party, the company’s interest in this respect is adverse to the complainant. It may also be presumed that in working the mine the company will be interested in conserving its own interests in protecting the reversion rather than the interests of Trotter as tenant. And all these things may be done without affording Trotter legal redress for the injury.

On the merits the case is with the complainant. Under such circumstances that objection to the mode of proceeding, and to the jurisdiction, if well founded, ought-not to be sustained.

The decree should be affirmed.

Decree unanimously affirmed.