United States Electric Lighting Co. v. Metropolitan Club

6 App. D.C. 536, 1895 U.S. App. LEXIS 3611

• Court: Court of Appeals for the D.C. Circuit
• Decided: June 17, 1895
• Docket: No. 478
• Status: Published

Opinion

Mr. Justice Morris

delivered the opinion of the Court:

1. A preliminary objection is made by the appellee that no appeal lies in this case, and that the appeal, therefore, should be dismissed for want of jurisdiction. The argument is that the order appealed - from does not change or affect property, and consequently is not comprised in the category of orders from which appeals may be taken under the seventh section of the act of Congress that created this court. That section provides that “ appeals shall also be allowed to said Court of Appeals from all interlocutory orders of the Supreme Court of the District of Columbia, or by any justice thereof, whereby the possession of property is changed or affected, such as orders for the appointment of receivers, granting injunctions, dissolving writs of attachment, and the like.” And it is urged that the present case is not within the provision, unless we hold, what it is urged is not the proper construction of the statute, that appeals may be taken in all cases where injunctions are allowed.

Assuming, according to the argument for the appellee, that the order for injunction from which an appeal may be taken must be an order changing or affecting the title to property, we are of opinion that the order in the present case is of that character.

It is not contended that the order, although purporting to be merely the continuance of a restraining order, is not in effect an order granting an injunction ; and it could not well be so contended; for the continuance of the restraining order is until the final hearing, and the force of an interlocutory injunction could be no greater. Nor is it contended that the electric current, which is the subject-matter of the order, is not property in contemplation of the statute. Now, we think that the possession of this property is affected by the order. It is evidently the purpose of the statute to include not only cases where the injunction operates to change the possession, but also cases where its operation is to affect the possession, without changing it ; for that is the very language of the statute. The property in question is the property of the electric lighting company, and remains its property until it is delivered to the club under the contract, when it becomes the property of the club. The company claims, and is entitled to, the free and unrestricted ownership, control and disposition of that property, subject only to such rights as the club may have to the enforcement of the contract. The order appealed from prevents and prohibits that ordinary and essential incident of ownership. It is, therefore, necessarily an order affecting the possession of property. To say that it is merely an order to maintain the status quo, which undoubtedly it is, does not serve the argument; for that is no more than to say that it does not change the possession, and does not fall within the category of orders of that class. We think that an order may be justly said to affect the possession of property which limits or restricts the use of property in a manner and to an extent to which it would not have been limited or restricted, were it not for the order. Nor does the fact that the restriction may be right and just help the argument: for that is the very question to be determined by the appeal, as well as by the court below in the first instance. We must regard the appeal in this case as properly taken.

2. Passing to the merits of the case, we are confronted h>y the difficulty that the merits of the controversy can scarcely be said to be before us. The order appealed from is merely an interlocutory order, a conservative measure intended to preserve existing conditions and to save all rights until the merits of the controversy can be definitely ascertained by such proofs as the parties may be able to adduce. It is not an adjudication of rights in any proper sense of -the term; and while, of course, under such circumstances, an injunction, when granted, must be in the line of the relief prayed for by a complainant and based upon a prima facie claim of right made out by the complainant, yet it does not follow that the final adjudication will be in accordance with the interlocutory order. We recall this elemen-tary principle merely to reinforce our idea that, although -the right of appeal is allowed in such cases and parties are -entitled to have such appeals determined, yet we should not lightly disregard the action of the court below, or reverse that action, unless it is made veiy plain to us either that -such action was erroneous, or that it is in the interest of -justice that it should be vacated. One who appeals from .-a merely interlocutory order should, therefore, show a very strong case to overthrow action intended in its very nature - to give the court reasonable opportunity to determine the ■ question of right in the controversy between the parties.

Five grounds are alleged here by the appéllant to show - that the order of the court below for the preservation of • the status between the parties pendente lite was not warranted. These are: ist. That there was no valid contract ■between the parties ; 2d. That the alleged contract, if valid, is not one which a court of equity will direct to be specifi-cally performed; 3d. That the violation of the contract by the appellee now justifies the appellant in declining further -. to perform it; 4th. That no irreparable injury will accrue to the appellee from the appellant’s failure or refusal to perform the contract; and, 5th. That the appellee has ample remedy at common law, and he should be remitted to his action at law.

With reference to the- first ground of objection, to the effect that there was no valid contract between the parties, this, even if it can be substantiated, is premature. It seems to be based upon the supposition that Mr. John A. Baker, who signed the contract for the Metropolitan Club, had no authority under the charter or by-laws of the club so to bind it. But the charter and by-laws of the club are not in evidence. They do not appear in the record before us. And the character of the contract entered into by them does not of itself exclude it from the cognizance of an executive committee or of the chairman of an executive committee. But the contract bears the corporate seal of the club, which alone would have been sufficient execution of it at common law; and it has been acted upon by both parties for upwards of seven years. It is rather too late now for the appellant to seek to repudiate it upon any such ground as this. Moreover, it is not quite apparent that, for the purpose of the present suit, any formal execution of the contract by the appellee was at all necessary. We do not mean to be understood as forestalling the final adjudication of this question, any more than any other question 'in the case, in accordance with such testimony as may hereafter be adduced in the cause. What we mean to say is, that, for anything that as yet appears in the record, we must regard the contract as having been duly executed, and as being a valid and subsisting contract.

But, in the second place, is it such a contract as that a court of equity will not decree specific performance of it, and will leave the parties to their ordinary remedy at common law? It is alleged that the contract is harsh, unjust, and unconscionable. This alleged injustice, when sifted to its ultimate elements, consists solely and exclusively in the fact, if fact it be, that the price stipulated to be paid by the appellee to the appellant for the use of the electric current is less by some three thousand dollars a year than the appellant claims that it ought to be. But no basis is shown for this claim. It may be shown to be well founded: but there is nothing thus far to show it. An advance of ten per centum upon the price of gas would seem not to be an unreasonably or unconscionably low price for the electric current under the conditions then existing or under present conditions. Certainly, in the presence of a contract, for all that yet appears, deliberately and knowingly entered into by the appellant and with a better knowledge of the conditions by the appellant than the appellee, a contract acted upon for several years by tire parties, it ought to require veiy strong proof to show unconscionable advantage taken of the appellant or serious misrepresentation made by the appellee before such contract can be repudiated for intrinsic injustice in the very important element of price.

This, of course, is a different question from that of the excessive and extravagant use of the electric current charged against the appellee in the answer, but which does not seem to be insisted on in this appeal. That question, also, it would be premature to consider here.

But a more serious difficulty is presented by an apparent want of mutuality in the contract. The electric lighting company seems to be perpetually bound to it, while the appellee may withdraw from it at any time after the expiration of one year from the date of its execution. That is, at the present time, under the terms of the contract, the appellee may terminate it at any time, while the appellant may never become entitled to terminate it.

Such a want of mutuality, it must be understood, does not make a contract less binding or less valid than it might otherwise have been ; but it may prevent specific performance through a court of equity. Marble Co. v. Ripley, 10 Wall. 340; Texas Railroad Co. v. Marshall, 136 U. S. 393; Duval v. Myers, 2 Md. Ch. 401; Gelston and Meyenberg v. Sigmund, 27 Md. 334; O'Brien v. Pentz, 48 Md. 562. But it does not necessarily follow in all cases that this want of mutuality will preclude the intervention of a court,of equity to decree specific performance. For if one party is in possession of a public franchise, and such franchise amounts to a virtual monopoly of the business, and such party enters into a special contract not otherwise invalid, it is not quite certain that such special contract may not under some circumstances be specifically enforced, at all events so far as by injunction to prevent its violation, when injunction will serve all the purposes of relief, although the obligation upon the one side may be perpetual-and on the other only temporary. Under the conditions disclosed in the record before us, and at the present stage of the proceedings, we are not prepared to say that there may not be in this regard exceptions to the general rule with regard to mutuality. We do not finally decide that question now. There is sufficient in this case to require the final determination of it to be postponed until it is shown by proof what kind of a franchise the appellant is exercising, and what the special character is of the obligations which it has assumed to the public.

It is quite apparent that the appellant’s threat to cut off the electric current from the appellee’s premises would occasion serious, if not irreparable, injury to the appellee, if done without just right. And it would be done without just right if the contract is fair and just, and a valid subsisting contract; and it is finally made to appear that not otherwise could the appellee be properly supplied. Irreparable injury is not the loss of that for which some substitute might be had. Irreparable injuiy implies the destruction of some right. If the appellee here is entitled to the right which it claims under its contract, irreparable injury would result from the proposed action of the appellant which would destroy that right. While that right, like every other right, may have a money value at common law, for which its destruction may be compensated, it is clearly of the class of rights which equity should protect by injunction: for it is possible that no pecuniary compensation could restore the right destroyed or any equivalent of it.

We are of opinion, therefore, with a due reservation of the fundamental questions involved to the final hearing, that the order now appealed from shoidf be affirmed, with costs. And it is so ordered. And it is also ordered that the cause be remanded to the Supreme Court of the District of Columbia with directions further to proceed therein according to law.