Opinion
04-23-1811
Fenwick v. M'Murdo and Fisher
Williams and Warden, for the appellant. Call and Hay, for the appellees.
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The only question decided in this case was, whether the appellees, who were originally defendants in an action of covenant, had full remedy, or had it in their power to defend themselves effectually, at common law.
The articles of agreement, on which the action was founded, were, in substance, as follows:
" Articles of agreement this day entered into between Charles James M'Murdo and George Fisher, trustees of James Wardrop, deceased, of the one part, and William Fenwick, of the other part, witness, that, for the considerations hereafter expressed, the said M'Murdo and Fisher, as trustees aforesaid, do hereby grant unto the said Fenwick full and free liberty and authority to take into his possession the mills, situate on Falling Creek in the county of Chesterfield, commonly called and known by the name of the Ampthill Mills, & c. to put the same, and every part thereof, in perfect and complete repair, and to make such alterations in the construction of the said mills as shall, in the opinion of said Fenwick, be best calculated to give them their full power and effect; to erect (should he choose to do so) a saw-mill, cooper's shop and store-house, in such situations as he shall think proper; as, also, a bridge across the creek, & c.; for the said purchases, and for the hire or salary of the different workmen, & c. except such as may attend the erection of the before-mentioned bridge, the said M'Murdo and Fisher hereby acknowledge themselves to be responsible, and engage that, at all times, they will be willing and prepared to pay the same, on the production of proper vouchers. And it is further agreed upon, and understood, that the said Fenwick shall retain quiet and peaceable possession of the before-mentioned property, for and during the full term of ten years, from the first day of October next, during which it shall be subject to his exclusive management and control, and shall be worked or used by him, his heirs or assigns, during that period, for his or their exclusive interest or emolument: Provided, (and the proviso is introduced by the trustees, in perfect confidence of its full and proper influence on the said Fenwick,) that, in all the repairs and improvements thus left to his discretion, the said Fenwick will not consider his own temporary accommodation only, but the real and permanent advantage of the property also, and proportion the expenditures accordingly. And the said Fenwick doth hereby engage, bind and oblige himself to obtain the necessary workmen and laborers as speedily as possible, and on the most advantageous terms he can, and to complete the work before particularized with all the despatch which shall appear to him to consist with the durability thereof; that the completion of the mills shall be the first object, and shall not be impeded by any other; that when the mills shall be completed the year shall commence; at the termination whereof, he will pay to the said M'Murdo and Fisher, or to whoever else shall be duly authorized to receive the same, the sum of six hundred dollars; at the end of each of the next succeeding two years the like sum; at the end of each of the next succeeding three years, the sum of one thousand dollars; and (should he, his heirs or assigns, choose so long to retain said property) at the end of each of the next succeeding three years, the sum of twelve hundred dollars: at that time (which will include a term of nine years from the completion of the mills) this lease shall terminate. It is also understood, and agreed to by the said Fenwick, that, should the said mills not be completed by the first day of October, which shall be in the year eighteen hundred and two, the rent, as above, shall, notwithstanding, commence on that day, and be payable on the same day in the year next succeeding; provided, however, that the works shall not have been retarded or destroyed by fire, freshes, or other inevitable accidents. The said Fenwick hereby further engages, for himself, his heirs and assigns, that, at the termination of the lease as before mentioned, the said mills and appendages, as before particularized, shall be delivered up to the said M'Murdo and Fisher, or to whoever else shall be authorized to receive the same, in good working and tenantable condition, such accidents by fire, water, or otherwise, as with due care and skill might have been prevented, and common wear and tear excepted: and should the said Fenwick, at any time previous to the termination of the lease as aforesaid, resolve to release the said mills and appendages, he hereby engages to the said trustees a preference to any other tenant on equal terms. In testimony, and for the due performance of these their respective engagements, the parties hereto do hereby bind themselves, their heirs and executors, each unto the other, their heirs, executors and assigns, in the penalty of twenty thousand dollars, to be paid by the party defaulting to the party performing; and have hereunto set their hands and fixed their seals, this eleventh day of August, eighteen hundred and one."
The declaration set forth the articles of agreement very fully; averred that every thing was done on the part of the plaintiff that he was bound to perform; and charged the breach in the refusal of the defendants, on the 30th day of August, 1803, to pay to the plaintiff the sum of 1,996l. 19s. 9d. for which they were responsible according to the contract, and for which he produced proper vouchers; stating that, on the first day of January, 1802, 422l. 15s. 6d. (part of the sum above mentioned) was, and part thereof had, long before, been due. Plea, " covenants performed," and issue. The jury found a general verdict for the plaintiff, for 2,341l. 11s. 11d. damages; and judgment was entered accordingly.
To this judgment M'Murdo and Fisher obtained an injunction from the superior court of chancery for the Richmond district, chiefly on the grounds that Fenwick's expenditures on the mills were extravagant and excessive, and not for the real and permanent advantage of the estate; that, availing himself of that clause of the contract which authorized him to make such alterations in the construction of the mills as should, in his opinion, be best calculated to give them their full power and effect, he proceeded, not only to repair the old machinery, but to construct new machinery throughout, and on a new plan; which was not the intention of the contract; that, at the trial at law, it having been admitted by M'Murdo and Fisher that the money charged in the account had been paid, " the denial that it was properly chargeable to the defendants at law seemed to have but little influence on the jury," and they sanctioned every charge made by Fenwick; that the jury had not time for a full and deliberate investigation of an account so lengthy and important, and taking the words of the contract as their guide, and (not considering (perhaps correctly avoiding to consider) the trust reposed in the plaintiff at law) they thought he had a right to make any alterations he might deem expedient.
The answer fully and particularly denied the equity of the bill; averring that all the improvements were bona fide made, being such as were indispensably necessary to embrace the objects and provisions of the contract, and to promote the permanent advantage of the property; and that this was shown to the satisfaction of the jury, and of the plaintiffs themselves, by the testimony of the millwright summoned by them.
A great number of depositions were taken on both sides; among which were those of five of the jurors who rendered the verdict at common law; one of whom swore that the jury did not inquire whether any particular article in the account was too high or too low, or if there was more than was necessary; as they considered Fenwick not limited by the contract as to the repairs or improvements which he might think calculated to give the mills their full power and effect; but that juror heard no testimony tending to show any money was used improperly, or that more was expended than was necessary. Three of them deposed that the trial was full; that the jury gave their verdict upon complete proof of the plaintiff's demand, after every objection " which the counsel for the defendants made" had been considered; being of opinion that the money was properly expended in erecting necessary works, completed upon the most economical terms, and according to the spirit of the contract between the parties. The fifth was in general of the same opinion, but said there was some unnecessary expense which appeared to proceed from error in judgment, for which Fenwick was not thought responsible by the jury.
The depositions contained a variety of testimony concerning the comparative expediency of repairing the old works, or of resorting to the new plan adopted by Fenwick; taking into view the quantity of water in the stream, and value of custom to the mill, compared with the expense incurred.
It appeared in evidence, that the machinery in the mills, when he took possession, was of little or no value; but that the expense of repairing the old machinery would have been much less than that of erecting the new; which, however, was better calculated to make the most of the wheat, and more advantageous to the lessee. A witness was of opinion that the mills could have been repaired upon the old plan for 1,710l. 3s. 11 3-4d.; but as to this, the testimony was doubtful. The money paid by M'Murdo and Fisher, and credited by Fenwick in his account, rendered before the district court, amounted to 1,825l. 4s. 6d.; adding to which, 2,086l. 19s. 9d. (the sum he recovered, exclusive of interest,) the cost of the new works appeared to be, at least, 3,912l. 4s. 3d.
The late chancellor, on the 28th of March, 1806, made the injunction perpetual; from which decree Fenwick appealed.
The decree is therefore reversed, and the bill dismissed with costs.
The case was very elaborately argued upon the merits, as well as the question of jurisdiction; by
Williams and Warden, for the appellant.
Call and Hay, for the appellees.
Upon the last point, the counsel for the appellees contended that effectual defence could not have been made at law, under the plea that was filed, or any other plea that could have been filed.
1. The plea was " covenants performed," which covers only the ground occupied by the declaration, and amounts, in substance, to the plea of payment. Under this plea no matter of defence could be introduced by the defendants, but such as tended to support their plea. They could not avail themselves of a precedent covenant to be performed by the plaintiff, and could not have held him to prove performance on his part of such precedent covenant. All the plaintiff was bound to prove was the amount of the sums expended, and that proper vouchers were produced.
But, in this case, the proviso was not even a precedent, but a collateral and independent covenant. The general averment of " performance, on the part of the plaintiff, according to the true intent and meaning of the contract," does not, in this case, refer to the proviso, but to the preceding part of the declaration, in which the plaintiff, after reciting the words of the contract, has introduced the novelty of undertaking to set forth the intent and meaning of those words. In this declaration there is no averment relating to the proviso. The question concerning it, therefore, could not have been tried by the jury. The plaintiff is not bound to aver performance on his part, except where, by his own showing, there is a covenant to be performed by him before performance can be exacted of the defendant. Where he makes an unnecessary averment performance, he is not required to prove it, but it is rejected as surplusage. Even then, if the plaintiff had averred that he made the repairs in conformity with the proviso, he would not have been bound to prove it; for it would have been surplusage; since the proviso was not a preliminary covenant.
1 Saund. 235, note (5); 1 Chitty, 232.
Bristow v. Wright, Doug. 665; 5 Com. Dig. 331; 1 Chitty, 216.
2. It was not possible at law to put in such a plea as would have given the defendants the benefit of the proviso.
The only way in which a special plea could have been drawn was, " that the plaintiff was not entitled to his action, because, in the repairs made by him, he had not consulted the permanent interest of the estate." But this plea might have been demurred to, because the covenant on which it relied was not a precedent, but an independent covenant; and the demurrer would have been rightly sustained.
The only question is, whether the proviso was a precedent or independent covenant? And this depends on no general rule, but the nature of the contract, and real intention of the parties. According to the contract, Fenwick was to begin immediately; M'Murdo & Fisher were to be immediately responsible for the expenditures, and to pay the money on the production of vouchers. The cotemporaneous exposition of the contract by the parties was such; as their conduct proved. Surely, then, the proviso could not have been a precedent condition. They could not have withheld the first payments on the ground of their being not certain that he was consulting the permanent interest of the estate. This could not have been ascertained, until very great progress had been made in the work. Even if the proviso had been an express preliminary covenant, Fenwick's part performance would have prevented the defendants from availing themselves of the defence; because their maintaining such plea would have occasioned a loss to the plaintiff of the money actually paid by him, and properly paid. Suppose he had advanced all the money out of his own pocket, before calling on them; they had refused payment; suit had been brought, and they had thereupon filed a special plea, relying on the proviso; if the plaintiff, instead of demurring, had joined issue, justice could not have been done to either party; because Fenwick, if defeated by such plea in bar, would not have recovered even as much of the money as he had rightfully paid. There was, therefore, no adequate remedy at law.
Hotham v. The East India Company, 1 T. R. 645; Campbell v. Jones, 6 T. R. 571.
In support of this point, the counsel cited also, 6 T. R. 573; Lord Mansfield's opinion in the case of Boone v. Eyre, reported in 1 H. Bl. 273, note (a); 1 Saund. 319, Pordage v. Cole; Ib. 320, note (4), and the cases there referred to; 1 Esp. N. P. 281; Gilb. Law of Evidence, 194, & c. and 1 Chitty, 313.
In opposition to an allegation on the other side, that the subject was fully before the jury, they contended that the only light in which the court should regard the case, should be to look at the record and pleadings, and consider no point as investigated but what the pleadings warranted. The inconvenience would be very great of adopting a practice of proving, by witnesses, what was said by counsel before the jury. Even in a case clearly proper for a court of equity, it might be contended that a question, which ought not to have been presented to the jury, was, in fact, argued before them. For example, where a bond has been given for payment of purchase-money, and a title not made, a witness might be called to prove that, in debt on the bond, the defendant's counsel, in argument, objected to the action on the ground of the defect of title; and, though the objection was overruled, or (very properly) disregarded, it might be said that, because the point was before the jury, the defendant should have no remedy in equity.
On the other side, it was said that Fenwick could not have recovered at law, without showing that the expenditures incurred were in conformity with the contract, of which the proviso was an essential part, but not an independent covenant; for a proviso does not make a covenant. The contract was, that they would pay the money, provided that, in all the repairs and improvements, he would not consider his own temporary accommodation only, but the real and permanent advantage of the property also, and proportion the expenditures accordingly. They were to pay, provided he did this; but if otherwise, they were not to pay. This inquiry, then, was proper for the jury; and they have decided that he has done so.
Suffield v. Baskervill, 2 Mod. 36; Briscoe v. King, Cro. Jac. 281.
The plaintiff, in support of the averment in his declaration that he had performed on his part all that was incumbent upon him to perform, was bound to prove that he made the repairs and improvements agreeably to the proviso. In like manner, in a case where a party purchases an estate, and agrees to pay a certain sum, provided particular counsel shall approve the title, the vendor must prove that his title was approved by that counsel, before he can recover of the purchaser. Under the plea of covenants performed, to this declaration and agreement, the whole subject was, therefore, properly before the jury.
Appleton v. Binks, 5 East, 148.
A court of equity can, upon no principle, make contracts for parties. It can relieve from a hard or unconscionable bargain, only by making the plaintiff accept compensation; and that must be his actual advances of money, with lawful interest; which is all the court of law has given in this case.
The president pronounced the opinion of the court in the following terms.
OPINION
Thursday, May 2d, 1811. The president pronounced the opinion of the court in the following terms:
" This appears an important case, rather from the amount of the subject in controversy, than from any difficulty respecting the principles that govern the decision; which have been well settled by this court in a variety of cases; and, among others, those of Terrell v. Dick; Turpin, Adm'r of James, v. Thomas's Representatives; Morris and Overton v. Ross; Syme and others v. Montague, and De Lima v. Glassel's Adm'r. The principle settled, on solemn argument and due consideration of those cases ought not now to be disturbed; which is, that where a cause has been once fully heard and decided in a court of common law, having competent jurisdiction of the case, a court of equity ought not to interfere, unless fraud or surprise be suggested and proved, or some material adventitious circumstance had arisen, which could not have been foreseen, or guarded against.
" The case before us was most properly cognisable in a court of common law, where it seems to have been thoroughly investigated, and underwent an able and lengthy discussion in all its parts; and a verdict and judgment was rendered in favor of the plaintiff; to which there was no exception taken, nor was there a motion for a new trial. This court, without deciding on its merits, is unanimously of opinion that the court of chancery had no jurisdiction of the case. The decree is therefore reversed, and the bill dismissed with costs."