Mr. Justice Sheldon
delivered the opinion of the Court:
It is first urged, that the corporation is not the proper party to bring this suit. The record discloses that by decree of the Will county circuit court, of date March 15, 1878, the Hon. Josiah MeBoberfcs, judge, presiding, Buchanan was appointed receiver. The present suit was in the Grundy county circuit court, and heard before the Hon. Josiah McBoberts. Appellant filed his cross-bill, making the receiver a party thereto, and the cause proceeded to a hearing upon the original and cross-bills. Under such condition of the record, the receiver being thus brought into the cause, we do not think the objection should be allowed to prevail that the suit was not brought in the. name of the receiver, instead of that of the corporation. The cause thus proceeding, there was a tacit assent on the part of the receiver and the court that appointed him, to the suit being carried on in the name of the corporation. It would be competent for the court to protect any interest of the receiver in the decree to be made, and as respects the defendant, at least, there would not seem to be any substantial cause of complaint.
It is insisted that appellee is not entitled to a specific performance because it has not performed on its own part,—that the time of performance was, by express terms, made of the essence of the contract, and that in such ease there must be performance at the exact day. This was a right which appellant might have insisted upon and stood by, and it was also a right which he might waive. After the default of payment at the time appointed, there was acquiescence in the laches of the vendee, and appellant treated the contract as still subsisting. He, after that time, applied for payment. He participated in the appointment of the receiver in the case of the creditor’s bill, and concurred in his selection, upon the ground that he would be more likely to have paid to him his money than if another person suggested were appointed. The record shows that on February 20, 1880, in the cause wherein the receiver was appointed, in the Will county circuit court, appellant filed his petition, claiming that the company was indebted to him on this contract, and after alleging the amount his due, prays that the receiver may account and pay him the amount due on account of royalty for coal mined under the contract, and lots sold, and that the receiver be directed, at an early day named by the court, to pay him all the money due him. By these acts ’ appellant manifested that he did. not intend to rely upon his right of forfeiture, or rescinding, for any past failure of performance, but was willing to receive his money and execute his contract, and we are of opinion they amounted to a waiver of the right to declare a forfeiture, and insist- upon time as the essence of the contract in respect of any previous failure of performance, and that he could not thereafter exercise such right without giving reasonable notice of his intent to do so. On May 1, 1880, appellant did declare a forfeiture of the contract for non-performance, and had notice thereof filed for record in Grundy county, and on May 5, 1880, delivered a copy of the notice to the secretary of the company, and on that same day the company made the tender above mentioned, as alleged in the bill. Under such circumstances we think this objection of non-performance, as respects payment, should not be sustained. See Chrisman v. Miller, 21 Ill. 227; Thayer v. Meeker, 86 id. 473; Webster v. French, 11 id. 254; Pomeroy on Specific Perform, secs. 337, 394.
But it is alleged that there is an entire want of performance in the construction of the railroad. It is true that it is a stipulation of the contract that Benson should cause the railroad to be constructed within six months. Appellee insists that this provision is solely for the benefit of the property, and for the purpose of strengthening it as security for the payment of the purchase price, and so the payment of the money will render the construction of the road an immaterial affair. The contract itself does not show this. It appears the length of the road would be about six miles, and its cost about $90,000. This would be largely in excess of the purchase price, and we may suppose the benefit .to the land purchased influenced, to a large extent, the making of the covenant. But the proof shows appellant to be the owner of a half section of coal land in the vicinity, which would be enhanced in value by the building of the railroad. It would not do to excuse the non-performance of this covenant on the ground of its being non-essential. It appears that there was an expectation that the Chicago and Alton Railroad Company would build this railroad, and before the making of the contract,.appellee, .with Benson, went to the president of that company to-ascertain as to that fact, and the president assured them that the railroad company would build the road; but on their requesting him to sign a writing to that effect, he declined, and afterward the contract was made with this stipulation in it: that Benson should cause the road to be constructed within six months. It was expected Benson would be the contractor for the work. Appellant himself testified that the Chicago and Alton Railroad Company graded a line from Coal City down to their track at or near Mason creek, in the fall of 1880. Under these circumstances we are satisfied that the railroad soon will be, if it has not already been, completed. Indeed, appellee’s counsel asserts, in his argument, that the road has been constructed, .though the proof fails to show this. The same waiver by conduct, which we have noticed, of the payment of the purchase price on the day appointed, applies equally, we conceive, to the building of the railroad within six months; and if it be proper for that reason to dispense with payment on the day appointed, and allow a brief time for payment of the money, it is in the same manner proper that there should not be a forfeiture because of not having constructed the railroad within the time limited, and to allow a time for the construction of it.
If it be held that appellee is entitled to a decree for specific performance, it is insisted, then, that the decree is for a less sum than the amount due appellant. In this respect there is evident error in the decree. Benson agreed to pay appellant the sum of $4300, and also assumed and agreed to pay twelve notes running to appellant, eleven of them for $1000 each, and one for $1500, all secured by mortgage on the premises executed, as well as the notes, by the Coalfield Coal Company. There were other incumbrances on the land which Benson was to take the land subject to. But the language in respect to this mortgage, and another like it to Goold, is peculiar. By the contract Benson covenants to pay all the liens and incumbrances on the land of whatsoever character, including said mortgages, “or save and keep harmless said parties of the first part from any and all loss, or danger of loss, on account of said liens or incumbrances, except the said mortgages, one given to Charles H. Goold and one given to H. Leroy Thayer, as above named,—which several sums, secured by said two mortgages last named, are to be paid in full, in interest and principal, within the time limited, ” (three years.) For four of these mortgage notes to him, appellant seems not to have been allowed by the decree. The situation with respect to those four notes was, that Thayer had previously parted with them, two of which were in the hands of Benson, and the other two in the hands of third parties, held as collateral security for indebtedness of Benson.
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Mr. Justice Sheldon
delivered the opinion of the Court:
It is first urged, that the corporation is not the proper party to bring this suit. The record discloses that by decree of the Will county circuit court, of date March 15, 1878, the Hon. Josiah MeBoberfcs, judge, presiding, Buchanan was appointed receiver. The present suit was in the Grundy county circuit court, and heard before the Hon. Josiah McBoberts. Appellant filed his cross-bill, making the receiver a party thereto, and the cause proceeded to a hearing upon the original and cross-bills. Under such condition of the record, the receiver being thus brought into the cause, we do not think the objection should be allowed to prevail that the suit was not brought in the. name of the receiver, instead of that of the corporation. The cause thus proceeding, there was a tacit assent on the part of the receiver and the court that appointed him, to the suit being carried on in the name of the corporation. It would be competent for the court to protect any interest of the receiver in the decree to be made, and as respects the defendant, at least, there would not seem to be any substantial cause of complaint.
It is insisted that appellee is not entitled to a specific performance because it has not performed on its own part,—that the time of performance was, by express terms, made of the essence of the contract, and that in such ease there must be performance at the exact day. This was a right which appellant might have insisted upon and stood by, and it was also a right which he might waive. After the default of payment at the time appointed, there was acquiescence in the laches of the vendee, and appellant treated the contract as still subsisting. He, after that time, applied for payment. He participated in the appointment of the receiver in the case of the creditor’s bill, and concurred in his selection, upon the ground that he would be more likely to have paid to him his money than if another person suggested were appointed. The record shows that on February 20, 1880, in the cause wherein the receiver was appointed, in the Will county circuit court, appellant filed his petition, claiming that the company was indebted to him on this contract, and after alleging the amount his due, prays that the receiver may account and pay him the amount due on account of royalty for coal mined under the contract, and lots sold, and that the receiver be directed, at an early day named by the court, to pay him all the money due him. By these acts ’ appellant manifested that he did. not intend to rely upon his right of forfeiture, or rescinding, for any past failure of performance, but was willing to receive his money and execute his contract, and we are of opinion they amounted to a waiver of the right to declare a forfeiture, and insist- upon time as the essence of the contract in respect of any previous failure of performance, and that he could not thereafter exercise such right without giving reasonable notice of his intent to do so. On May 1, 1880, appellant did declare a forfeiture of the contract for non-performance, and had notice thereof filed for record in Grundy county, and on May 5, 1880, delivered a copy of the notice to the secretary of the company, and on that same day the company made the tender above mentioned, as alleged in the bill. Under such circumstances we think this objection of non-performance, as respects payment, should not be sustained. See Chrisman v. Miller, 21 Ill. 227; Thayer v. Meeker, 86 id. 473; Webster v. French, 11 id. 254; Pomeroy on Specific Perform, secs. 337, 394.
But it is alleged that there is an entire want of performance in the construction of the railroad. It is true that it is a stipulation of the contract that Benson should cause the railroad to be constructed within six months. Appellee insists that this provision is solely for the benefit of the property, and for the purpose of strengthening it as security for the payment of the purchase price, and so the payment of the money will render the construction of the road an immaterial affair. The contract itself does not show this. It appears the length of the road would be about six miles, and its cost about $90,000. This would be largely in excess of the purchase price, and we may suppose the benefit .to the land purchased influenced, to a large extent, the making of the covenant. But the proof shows appellant to be the owner of a half section of coal land in the vicinity, which would be enhanced in value by the building of the railroad. It would not do to excuse the non-performance of this covenant on the ground of its being non-essential. It appears that there was an expectation that the Chicago and Alton Railroad Company would build this railroad, and before the making of the contract,.appellee, .with Benson, went to the president of that company to-ascertain as to that fact, and the president assured them that the railroad company would build the road; but on their requesting him to sign a writing to that effect, he declined, and afterward the contract was made with this stipulation in it: that Benson should cause the road to be constructed within six months. It was expected Benson would be the contractor for the work. Appellant himself testified that the Chicago and Alton Railroad Company graded a line from Coal City down to their track at or near Mason creek, in the fall of 1880. Under these circumstances we are satisfied that the railroad soon will be, if it has not already been, completed. Indeed, appellee’s counsel asserts, in his argument, that the road has been constructed, .though the proof fails to show this. The same waiver by conduct, which we have noticed, of the payment of the purchase price on the day appointed, applies equally, we conceive, to the building of the railroad within six months; and if it be proper for that reason to dispense with payment on the day appointed, and allow a brief time for payment of the money, it is in the same manner proper that there should not be a forfeiture because of not having constructed the railroad within the time limited, and to allow a time for the construction of it.
If it be held that appellee is entitled to a decree for specific performance, it is insisted, then, that the decree is for a less sum than the amount due appellant. In this respect there is evident error in the decree. Benson agreed to pay appellant the sum of $4300, and also assumed and agreed to pay twelve notes running to appellant, eleven of them for $1000 each, and one for $1500, all secured by mortgage on the premises executed, as well as the notes, by the Coalfield Coal Company. There were other incumbrances on the land which Benson was to take the land subject to. But the language in respect to this mortgage, and another like it to Goold, is peculiar. By the contract Benson covenants to pay all the liens and incumbrances on the land of whatsoever character, including said mortgages, “or save and keep harmless said parties of the first part from any and all loss, or danger of loss, on account of said liens or incumbrances, except the said mortgages, one given to Charles H. Goold and one given to H. Leroy Thayer, as above named,—which several sums, secured by said two mortgages last named, are to be paid in full, in interest and principal, within the time limited, ” (three years.) For four of these mortgage notes to him, appellant seems not to have been allowed by the decree. The situation with respect to those four notes was, that Thayer had previously parted with them, two of which were in the hands of Benson, and the other two in the hands of third parties, held as collateral security for indebtedness of Benson.
The two notes in the hands of Benson were delivered by him to Thayer at the time of the execution of the contract ; the two others held as collateral, Thayer subsequently acquired from the parties who so held them, paying for one $375, and for the other $605. Appellant thereafter, and at the hearing, held these four notes, as well as the eight other mortgage notes. He was the payee of the notes. The covenant was express to pay the sums represented by these notes in full, interest and principal, within the time limited,— three years. . The two notes which Benson had in hand and had the power to deliver, he did then deliver to appellant. If Benson was not to pay these mortgage notes as a part of the purchase price, why did'he deliver them to the appellant, the payee ? Why not cancel them, or hold them in his own hands as evidence that he had, so far, satisfied the mortgage ? Benson was the president of this appellee corporation. Buchanan was its secretary from the date of its organization to the time he was appointed receiver. The account books of the corporation show an indebtedness to appellant for the full amount of all the mortgage notes,—$12,500. The officers of the corporation repeatedly admitted appellant to be entitled to the entire sum covered by all the twelve notes. Buchanan rendered written statements showing that all the notes were owned by appellant. One of these statements was part of his sworn report as receiver, made to the court that appointed him, filed June 10, 1878. It is a statement of account with H. L. Thayer. The first item reads: “April 3, 1878. To one-half of $2875, annual interest due H. L. Thayer and C. H. Goold, on principal sum of $28,750, at ten per cent per annum, $1437.50.” This account was, upon motion of said receiver, referred to the master for examination, and by him reported to the court as correct, and at the instance of the receiver it was approved by the court. Said principal sum of $28,750 was made up of all these mortgage notes, of $12,500 to Thayer and Goold, each, and the interest which had accrued thereon at the date of the contract,—$1875 on each mortgage,—which interest Benson had agreed with appellant to turn into principal, and pay ten per cent interest on it. Another statement by Buchanan is entitled and dated, “April 3, 1877. Due Thayer and Goold, ”— and then showing the sum ($1437.50) obtained by multiplying the principal sum of $28,750 by five, and which appears to be a computation of six month’s ten per cent interest on $28,750. This principal sum also included all of said mortgage notes, and said accrued interest to date of contract. Each of said accounts also showed to be due appellant the further principal sum of $4300, and ■ interest. The books of account of the corporation, in evidence, show the debit side of the real estate account, as follows: “To bills payable, * * * for-notes of the Coalfield Coal Company, to H. L. Thayer,-dated April 1, 1875: eleven notes for $1000 each, and one note for $1500.-” And on the journal of the company appears the entry: “Real estate account, debtor, to H. L. Thayer and C. H. Goold: interest due them April 3, 1877, on $28,750, six months, at ten per cent, $1437.50; interest due them April-3, 1877, on $8600, six months, at eight per cent, $344.”
In opposition to all this is the testimony of Buchanan that he- was present at the making of the contract, and there was an agreement that Thayer would induce Goold to' join with him in the conveyance to Benson of certain lots in Coal City, and would advance the money to take up the two notes hypothecated, in consideration of which Benson would turn over to Thayer the two notes held by him, and also his right in the two notes hypothecated; and then, upon repayment to Thayer of the money advanced to take up the two notes hypothecated, with interest, the conveyance of the lots was to be delivered to Benson, and one-half of. the four notes to be and belong to Benson, to be indorsed on the contract, or otherwise, as he might direct. This testimony, contradicted by appellant, or anything else there may be in the case, we consider as wholly without avail to overcome the other conclusive evidence which has been referred to, showing that all the mortgage notes, of $12,500, belong to appellant, and are a just indebtedness, to be paid to him before a specific execution of the contract should be enforced.
Appellant testified that soon after the making of the contract, an agreement was made between him and Benson that the interest which had accrued on the $12,500 mortgage given by the Coalfield Coal Company to appellant, should be considered as a part of the principal sum, and should bear ten per cent interest from the date of the contract, such accrued interest amounting to $1875. Appellee recognized and acted upon this agreement, setting this amount of accrued interest down in its books as a part of the principal sum, and as bearing ten per cent interest, and made several payments of ten per cent interest upon it. It seems the circuit court disallowed such payments, as being the payment of compound interest, we presume. It is true that compound interest will not be allowed in the absence of an agreement to pay it; but after interest has accrued due, it may, by agreement between the parties, be turned into principal, and made to bear interest for delay of payment. There is sufficient evidence that such an agreement was made in this case, and we see no reason why it should not be carried out. See Bishop Hill Colony v. Edgerton, 26 Ill. 54.
There was error in decreeing a sale of the property. As soon as the amount due was determined by the decree it should at once have been paid to appellant. He should not have been subjected to the delay of realizing the money from a sale of the land. This mode of raising money by a sale of the land to pay the purchase price, is not to be permitted to a vendee. Suppose the land should sell for less than the amount due, the vendor then would not get the purchase price, and he would have been made to part with his land upon different terms than he stipulated. Appellant should not be deprived of his land before being paid the purchase money. He was entitled, as before said, to have payment of it as soon as the decree was rendered, and there should have been given but a very short day to pay it, and in default of payment at the day, all right and interest of appellee ór Benson in the lands, under the contract, should have been forever extinguished.
Further, appellee is not entitled to have a specific performance until there has been performance of the contract on its own part in respect of the building of the railroad, as well as of the payment of the purchase money; and if the railroad shall not have already been constructed, then there should be further decree that unless the railroad should be constructed within a certain time, which we fix at sixty days after the entry of the decree of the circuit court, all appellee’s and Benson’s right and interest under the contract in the lands should be forever extinguished.
The judgment of the Appellate Court will be reversed, and the cause remanded for further proceedings conformable to this opinion.
Judgment reversed.
Mr. Justice Walker: I am unable to concur in some of the rules announced.