Negaunee Iron Co. v. Iron Cliffs Co.

96 N.W. 468, 134 Mich. 264, 1903 Mich. LEXIS 631
CourtMichigan Supreme Court
DecidedSeptember 15, 1903
DocketDocket No. 48
StatusPublished
Cited by40 cases

This text of 96 N.W. 468 (Negaunee Iron Co. v. Iron Cliffs Co.) is published on Counsel Stack Legal Research, covering Michigan Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Negaunee Iron Co. v. Iron Cliffs Co., 96 N.W. 468, 134 Mich. 264, 1903 Mich. LEXIS 631 (Mich. 1903).

Opinion

Grant, J.

{after stating the facts). 1. It is urged that this bill cannot be maintained, because its main purpose is to declare a forfeiture of the 99-year lease, and that courts of equity will not enforce a forfeiture. Counsel cite in support of this contention Funk v. Haldeman, 53 Pa. St. 229; 2 Story, Eq. Jur. § 1319; Bisp. Eq. § 181; 1 Pom. Eq. Jur. § 459; Crane v. Dwyer, 9 Mich. 350 (80 Am. Dec. 87); White v. Railway Co., 13 Mich. 356. The general rule is undoubtedly as stated in Funk v. Haldeman. The statement by the court was not necessary to a decision of the case. The court held that there was no violation either of tenure or covenants of the instrument which conveyed to Punk an incorporeal hereditament in fee, namely, the right to enter upon certain lands for the purpose of prospecting, boring, and taking away ore, oil, etc., out of the earth. The claim was that Funk had subdivided that which he could only hold in entirety, and had, therefore, lost all. At the close of the opinion the court said that, if Funk had lost his rights by the subdivision, ‘ ‘ a chancellor would be likely to send the grantors into a court of law to enforce the forfeiture by ejectment; for equity does not, ordinarily, enforce forfeitures. ” The case does not hold that in no case of forfeiture may a court of equity interfere. Pomeroy states that those cases which appear to be exception's to the rule are not so in reality. Bispham says, ‘ ‘ In some cases, however, the enforcement of a forfeiture may be regarded ;n equity with favor.” Crane v. Divyer was an attempt to enforce in equity a forfeiture of a land contract, the vendee being in possession. The forfeiture sought to be enforced in White v. Bailioay Co. was similar. These cases are in accord with the general rule. See, also, Hodges v. Buell, ante, 162 (95 N. W. 1078).

[276]*276The-supreme court of Pennsylvania, in Brown v. Vandergrift, 80 Pa. St. 142, stated the doctrine to be that equity “abhors a forfeiture when it works a loss, but not when it works equity, and protects the landowner against the indifference and laches of the lessee, and prevents a great mischief.” In that case the lessee agreed to keep-his lease good by a payment of $30 per month until he should commence operations, and, failing to do so, the lease was forfeited. He paid for 4 months; then failed to pay or to commence operations for 11 months. He sought to contiiiue his lease by tendering payment for the 11 months. Equity interfered, and declared the lease forfeited.

In Eberts v. Fisher, 44 Mich. 551 (7 N. W. 211), this, court, speaking through Mr. Justice Campbell, said:- “ There is no rule that equity will not recognize a forfeiture when it is only one of the incidents of a past transaction.” In that case it was held that the lease involved had expired by its own limitation, and, until renewed, had lost any efficacy.

Where a lessee has abandoned the premises, asserted no right under his lease for many years, and the lessor has been in exclusive possession, acting in apparent hostility to the lease, equity will interfere to prevent the lessee from afterwards attempting to take possession under the lease and asserting its existence. See Detlor v. Holland, 57 Ohio St. 492 (49 N. E. 690, 40 L. R. A. 266).

The bill in this case alleges exclusive possession for more than 15 years in the complainants; an abandonment by the Pioneer Iron Company of the lease for nearly 40-years ; that the Pioneer Iron Company was dead by reason of the expiration of its charter; that the right to mine ore-conveyed by the lease to the Pioneer Iron Company was appurtenant to the furnaces which it was then erecting; that said furnaces were dismantled in 1894; that no other furnace has been erected since; and that said right to mine ore, conveyed by said lease, was personal to the Pioneer Iron Company, and incapable of assignment.

We think, however, the main purpose of the bill is, not [277]*277to declare a forfeiture of the lease, but to determine the rights of the parties, which depend largely upon the construction of the deeds, the leases, and the various acts and conduct of the parties, extending over a period of more than 40 years, and to enjoin a continuing trespass. The case is one peculiarly appropriate to a court of equity.

The bill sets forth three notices in the name of the Pioneer Iron Company that it had entered upon the disputed lands for the purpose of mining iron ore. It is, therefore, apparent that numerous acts of trespass and the removal of valuable ore were threatened. The defendants are not in possession. The Pioneer Iron Company, through Mr. Duncan, its alleged agent, who is also agent and manager of the defendant companies, gave notice to the complainants that they had entered upon certain of these lands for the purpose of exploring for iron ore to be used in the furnaces, according to the grant made in the 99-year lease. Under this notice and all the others there was no claim of occupancy by the defendants or the Pioneer Iron Company by adverse possession. Whether or not, under these circumstances, ejectment would lie, we need not determine. Complainants being in possession of the property, if their title is valid, irreparable injury was threatened by the defendants. Such trespasses a court of equity will enjoin. 3 Pom. Eq. Jur. § 1357; Stone v. Lumber Co., 59 Mich. 31 (26 N. W. 216); Hall v. Nester, 122 Mich. 141 (80 N. W. 982); Halpin & Co. v. McCune, 107 Iowa, 494 (78 N. W. 210); Campbell v. Kent Circuit Judge, 111 Mich. 575 (70 N. W. 141); F. H. Wolf Brick Co. v. Lonyo, 132 Mich. 162 (93 N. W. 251); West Point Iron Co. v. Reymert, 45 N. Y. 703; Oolagah Coal Co. v. McCaleb, 68 Fed. 86, 15 C. C. A. 270.

2. It is also urged as a fatal objection to the maintenance of the bill that the Pioneer Iron Company is not made a party. Under the allegations of the bill, and as well under the proofs, the Pioneer Iron Company is used as a “dummy ” for the benefit of the defendant companies. [278]*278The defendants own, and have owned for many years, all its capital stock, its furnaces and property, both real and personal. They have managed all its affairs, and for their own benefit. All its accounts, if any have been kept in the name of the Pioneer Iron Company, have been kept upon the books.of the defendants. The defendants refused upon the trial to produce the books of the Pioneer Iron Company, or their own books showing the accounts. Some of its officers having charge of the books were produced as witnesses, and testified to the above facts. Under these circumstances, these defendants cannot escape-the consequence of their acts done in the name of the-Pioneer Iron Company for their own benefit. Admitting that the Pioneer Iron Company is not a dead corporation, yet all its property, franchise, and rights are owned by the defendant companies, so far as the rights under the 99-year lease are concerned, and are fully represented by those now before the court.

The theory of the complainants, as stated in their bill,, is that the Pioneer Iron Company is a dead corporation;, that its charter expired by limitation April 2, 1887; and that no steps were taken for some time thereafter to reorganize the corporation under the amendment to the Constitution and the law; and that that action was wholly invalid.

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Bluebook (online)
96 N.W. 468, 134 Mich. 264, 1903 Mich. LEXIS 631, Counsel Stack Legal Research, https://law.counselstack.com/opinion/negaunee-iron-co-v-iron-cliffs-co-mich-1903.