Case ID: ohio-cc-dec_15/html/0663-01.html
Source: Caselaw Access Project
Author: {"author": "WILSON, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

CONTRACTS — EQUITY—MUNICIPAL CORPORATIONS.
    [Franklin (2nd) Circuit Court,
    January 19, 1904.]
    Sullivan, Summers and Wilson, JJ.
    Columbus (City) v. Cleveland, C. C. & St. L. Ry. Co.
    1. Municipality may Contract Same as Individuals, When.
    A municipal corporation has power to enter into contracts which it reasonably believes advantageous and beneficial to its citizens, notwithstanding it may be without administrative power to enforce their performance, or cannot do so under its police power. Hence, a contract between a municipality and two railroad companies wherein the latter, in consideration of the construction of a street viaduct by the former, agrees to erect on their property fronting on the viaduct “neat and ornamental buildings” for the purpose of obstructing the view of railroad cars and engines from persons and apimals passing over the same and also to make it have the appearance and advantages of a continuous street, being a contract advantageous and beneficial to the municipal citizenship, will be sustained as a valid exercise of municipal power, although there may be no power to enforce the erection of the buildings.
    2. Specific Performance of Building Contract Decreed.
    The general rule that equity will not decree specific performance of a building contract, but will leave the parties to their, remedy at law, does not apply where the plaintiff cannot enter upon the defendant’s premises and erect the building, where, a measurable money equivalent cannot be had in lieu thereof, or where there has been a part performance by plaintiff so that defendant is enjoying the benefits of the contract in specie. Where the contract is capable of being performed and nothing short of performance will accomplish the purpose of the contract, and no rule in damages could be framed so as to give adequate relief, specific performance will be decreed.
    3. Want of Mutuality Between Possible Assignees no Defense.
    Want of mutuality between possible lessees or assignees of the parties to a contract is no defense to a specific performance between the original parties between whom there is mutuality.
    4. Part Performance Decreed, When.
    Specific performance of a contract, generally, will not be decreed when to do so would be a vain thing, as where defendants have the right at any time to revoke or annul the obligation contracted to be performed; but where plaintiff is entitled to have the contract executed while defendants are in a position to perform, defendants may be compelled, at the election of plaintiff, to perform to the extent that they are capable, especially where the violation is flagrant and the injury serious, notwithstanding there is a possibility of the contract becoming inoperative by a change in the relation of the parties. Hence, where defendants may, under a building contract, lease or sell the property whereon they are to build free from any claim or lien of plaintiff arising out of the contract, equity may decree the specific performance thereof during the time defendants remain in possession in order that plaintiff may to such extent enjoy the protection and benefit flowing from it, especially where it is -obvious that a remedy in damages for a breach would be wholly inadequate.
    ñ. “Neat and Ornamental” in Building Contracts Reasonably Construed.
    The words“neat and ornamental” used in a building contract and referring to the appearance of buildings to be erected, should receive a reasonable construction, looking to the purpose sought to be accomplished. ■ Accordingly where the contract specifies the purpose, the defendants in an action to compel their erection will not be heard to complain of the contract because of the latitude and discretion given them as to the kind and cost of the buildings to be erected and the material to be used in their construction.
    6. Evidence That Plaintiff can be Satisfied by Certain Buildings.
    Equity is warranted in finding the purpose of such building contract easy of accomplishment to the satisfaction of the plaintiff, when it appears that one of the defendants has erected part of the buildings under the contract to its entire satisfaction.
    7. Use of Bad Material not Assumed.
    Equity will not assume that the defendants, in an action for specific performance of a building contract, will use material in their construction which should not be used, or that they will build other than upon approved architectural lines.
    8. Equity May Enjoin Erection of Unsightly Building.
    A decree for the specific performance of a building contract may he so enforced by a court of equity as to prevent the erection of a building made purposely grotesque and unsightly, or that is plainly fraudulént and evasive of the contract.
    9. Right to Sell Free From Incumbrance Implies Right to Hold in Same Manner, When.
    The right to sell property free from incumbrance generally implies the right to hold it unincumbered in order that it might be sold at any time; but not where it would be in plain contradiction to the obligation to be performed with reference to such property, as where the owner has contracted, for a valuable consideration, to erect buildings thereon while in possession for the benefit of the promisee, notwithstanding the stipulation that such obligation shall in no wise create a lien or incumbrance upon the property, nor impair the right to lease or sell the same free from any claim or lien arising under the contract. In such case the obligation and understanding is to build at all events as long as possession is retained, but that the property can be sold or leased free from such obligation if the buildings erected should prove a losing investment so that their maintenance would be a charge or incumbrance, upon the property.
    10. Equity Will not Determine Want of Power to Enforce Decrees, When.
    Where want of power in a court of equity to decree the means by which to execute a decree of specific performance does not necessarily appear from the pleadings, the court will not determine such questions upon a demurrer to the petition.
    11. Whether Lease or Sale to Avoid Decree Upheld, Quaere.
    Whether a leasq or sale of property for the express purpose of defeating a decree for the specific performance of a building contract would be upheld in equity quaere.
    
    Appeal from common pleas court of Franklin county.
    G. S. Marshall and James M. Butler, city solicitor, for plaintiff.
    W. O. Henderson- for P. C. C. & St. L. Ry. Co., and J. F. Wilson, for C. C. C. & St. L. Ry. Co.
   WILSON, J.

These actions [Columbus v. Cleveland, C. C. & St. L. Ry. Co., and Columbus v. Pittsburgh, C. C. & St. L. Ry. Co.] come into this court on appeal from a judgment in the court below, sustaining a general demurrer and dismissing the petition in each case (Columbus v. Railway Co. 12 Dec. 310). The}- are submitted together as involving the same questions of law.

The actions are brought to enforce the specific performance of a contract made by the defendant's, respectively, with the plaintiff in and about the erection of the viaduct on High street in said city. The contract is attached to the petition. The particular stipulation which is brought into question is contained in what is designated as section fourteen of the contract. It reads as follows:

“In consideration of the first party (the city) constructing the viaduct at the elevation shown upon said plan hereto attached, said second and third parties will, at their own expense erect, or cause to be erected, on their property fronting on the viaduct and its High street approaches, neat and ornamental buildings to obstruct from the part of said viaduct immediately opposite their said property the view of cars and engines; the construction of said buildings to be commenced within sixty days after the completion of said viaduct, prosecuted without unnecessary delay, and fully completed within two years from the completion of the viaduct. This stipulation shall not create any lien, charge or incumbrance on said fronting property, -nor impair, in any wise, the rig-ht or power, of said second and third parties to lease, sell, convey or dispose of said property, or any part thereof, free from any claim or lien, of the first party, arising out of this agreement; nor shall such lease, sale, conveyance or disposition, release said second and third parties from their obligation to erect said buildings, or to cause them to be erected.”

The city pleads compliance with all of the terms of the contract on its part and avers in the first case that the Cleveland, Cincinnati, Chicago & St. Louis Railway Company, owning property fronting on each side of the viaduct, and still being in possession of the same, has failed and refused, and still refuses, to erect the buildings as it has agreed to do; and in the second case that the Pittsburgh, Cincinnati, Chicago & St. Louis Railway Company, owning and in possession of property fronting on both sides, having complied with the contract to the satisfaction of the city, as to the property on the east side, has failed, and refused, and still refuses, to erect the buildings on the west side thereof.

The question raised upon the demurrer is, do the petitions state a case for specific performance? The propositions made in support of the demurrer are: That the city is without power or authority to enter into the contract; that, as a general rule, courts of equity will not order the specific performance of a building contract, and the petitions do not state a case within any of the recognized exceptions to the rule; that the contract is too indefinite and uncertain to form a predicate for such decree, and that, it being in the power of the defendants to render the decree inoperative, by selling or leasing the property, the court will not order specific performance.

As to the first proposition it may be conceded, upon the authorities cited, that the city, on its administrative side, is without power to’ enforce the erection of these buildings; such power not being within any legislative grant, or a proper exercise of the police power. But we know of no authority, and none is cited, which will prevent the city, as a private business corporation, from entering into any contract that it may have ’good reason to believe advantageous and beneficial to the citizenship; and such, in our view, is the contract in question.

The general rule that a court of equity will not decree specific performance of a building contract does not apply, where it is not competent for the plaintiff, or any one for it, to enter upon the defendant's premises to build, and where a measurable money equivalent cannot be had.

In a footnote to the case of Mosely v. Virgin, 3 Ves. Jr. 184, the reason for the rule is said to be “If one will not build, another may, and" there can be a full compensation in damages.”

The exceptions to the rule, and the authorities sustaining them are collected in 3 Pomeroy, Eq. Jurisp. Sec. 1402, p. 445, n. -From them we quote: >

“This court has jurisdiction to enforce the specific performance of a contract by a defendant to do defined work upon his property, in the performance of which the plaintiff has a material interest, and which is not capable of adequate compensation in damages.” Storer v. Railway Co. 2 You. & Coll. Ch. 48.
“Where, from the nature of the relief sought, performance of a covenant in specie, will alone answer the purpose of justice, the court of chancery will compel a specific performance instead of leaving the plaintiff to an inadequate remedy at law.” Stuyvesant v. New York (Mayor), 11 Paige 414.

Another exception to the general rule, well sustained by authority is, where there has been a part performance, so that the defendant is enjoying the benefits in specie.

The eases at bar come clearly within the exceptions, if the work is sufficiently defined.. The relief here sought is, in the language of the contract, the erection of “neat and ornamental buildings, to obstruct from the part of said viaduct immediately opposite their (the defendants’) said property the view of cars and engines.”

Nothing short of performance in specie will accomplish this purpose, and at the same time give to the viaduct the appearance and advantages of a continuous street. Nor is it perceivable how a rule in damages could be framed só as to give adequate relief.

But is the contract sufficiently definite?

In the case of Price v. Corporation of Penzance, 4 Hare 507, the contract was that the corporation, having purchased the plaintiff’s land, should, at their own expense, make a street, and also a market. ’ ’

The vice chancellor said:

“Under this contract the corporation have taken possession of the land and converted it; and having had the benefit of the contract in specie as far as they are concerned; I need not say that the court will go to any length which it can to compel them to perform the "contract in specie

The court asked this question, however, “If I make a decree for the performance of the contract, how is the court to know when the contract is performed?”

Subsequently, the corporation having by resolution declared that the market should be one for the sale of fish and shoes, the court said, in a further hearing of the case: “This has gone -far to remove the difficulty to which I have adverted.” Thereafter the corporation performed the contract, leaving the case to be adjudged as to costs only.

In thé case of Sanderson v. Railway Co. 11 Beav. 497, “A railway company about to sever the plaintiff’s land by their railroad, agreed to purchase the necessary portion of land, subject to making such roads, ways, and slips for cattle as might be necessary.” And, having taken possession, and severed the land, the court held that “though it was difficult to execute an agreement thus expressed, yet that the plaintiff was entitled to specific performance; that the word 'Necessary’ must receive a reasonable interpretation.” And it was held to mean “such roads, ways, and slips for cattle, as might be necessary and proper for convenient communication between the severed portions of the plaintiff’s land.”

In the case of Storer v. Railway Co. supra, “The defendants agreed to purchase so much land as was necessary for their purposes, at a price named, and to construct, and forever thereafter maintain, one neat archway, sufficient to permit a loaded carriage of hay to pass under the archway, at such place as the plaintiff, his heirs and assigns should think most convenient, in his pleasure grounds, and-should form and complete the approaches to such archway.”

The .vice chancellor said:

“There is no difficulty in enforcing such a decree. The court has to order the thing done, and then it is a question capable of solution whether the order has been obeyed.”

In the ease of Lawrence v. Railway Co. 36 Hun (N. Y.) 467, the contract provided among other things, that: “The defendant should simultaneously with the construction of said railroad, erect at or near Excelsior Spring, owned by the plaintiff, a neat and tasteful station building, for the-accommodation of passengers to and from said spring, which shall be a regular station of the road, and all regular trains shall stop at said station, the name of which shall be Excelsior Spring Station: Held, that the defendant could, and should be compelled to specifically perform the said agreement.”

This case is approvingly cited by the New York court of appeals in Prospect Park & C. I. Ry. Co. v. Railway Co. 1 Am. & Eng. Eq. Dec. 395. These cases are cited because the contracts might be said to- be indefinite, and because they illustrate the length to which the courts of equity will go in order to do justice between the parties.

There is a class of cases holding that kindred contracts cannot be specifically performed. Port Clinton Ry. Co. v. Railway Co. 13 Ohio St. 544, 545, is a leading case in that class. In the nature of things, this must be so, for the reason that some such contracts are capable of being performed, while others are not. It is not, then, so much a question of authority as it is, to which class ’ does the contract belong; always remembering that a doubtful case will be cast on the side where complete justice can be done.

In the light of all the authorities there are no insuperable difficul-. ties in the contract sued upon here. The words “neat and ornamental” should receive a reasonable construction, looking to the purpose it is sought to accomplish. The contract specifies the purpose, in so far as the city is concerned. It is to obstruct the view of cars and engines, to persons and animals crossing the viaduct — a very useful purpose, and, it would seem, very easy of accomplishment, to the satisfaction of the city. The fact that one of the railroad companies has erected buildings on the east side of the viaduct satisfactory to the city, is a demonstration of this view of the contract.

The defendants should not be heard to complain of the latitude in the contract, which will permit them to erect buildings suitable otherwise to their own purposes, and within their discretion as to cost and material.

The court will not assume, for the purpose of defeating the contract, that they will use material they should not, or that they will build other than upon approved architectural lines. Nor will the court be without power to execute its decree. It could, under the contract, enjoin the erection of a building that was being made purposely grotesque and unsightly, or that was plainly fraudulent and evasive of the contract. The same power will execute the decree.

A more serious question is, whether the court should order specilic performance in the face of the other stipulation that the property may be leased or sold free from incumbrance. As a general proposition, it may be stated that the court will not do a vain thing, and that it would bo vain to order specific performance if the defendants have the right at any time to revoke or annul their obligation to perform. Rutland Marble Co. v. Ripley, 77 U. S. (10 Wall.) 339; Southern Express Co. v. Railway Co. 99 U. S. 191; Rust v. Conrad, 47 Mich. 449. These stipulations are not easily reconcilable. Ordinarily the right to sell the property free from incumbrance would imply the right to hold it unincumbered, in order that it might he so sold at any time. But this would he in plain contradiction of the obligation of the railroad companies to build these structures; and if this interpretation is to obtain, it would seem that the contract had been purposely made to be broken, in order that an abatement in the consideration might be sought in the way of damages. Such-indirection is not fairly presumable. A more reasonable construction would be that the railroad companies should build the structures at all events, if they remained in possession; hut if they proved to be a losing-investment, so that their maintenance would be a charge and incum-brance upon the property, to the diminution of its value, they should have the right to lease or sell the property free from any such liability.

It is a familiar principle in specific performance, that a party to a contract may, at the election of the other party, be compelled to perform to the extent he is capable, before resort is had to the remedy at law.

In this case the plaintiff is entitled to have the contract executed during the time the defendants remain in possession, in order that it may, to that extent, enjoy the protection and the benefits flowing from it. This is particularly true when, it is obvious the remedy in damages is wholly inadequate.

There was no want of mutuality in this contract, at the time it was made, and can he none so long as the defendants remain in possession. That there may he such between the plaintiff and the lessee or assignee of the defendants is a question with which the court is not now concerned. The power of revocation or annullment of this stipulation to build is not vested in the defendants. On the contrary, it is expressly, and by the last words on the subject, inhibited. To this extent these cases are distinguished from the authorities above cited upon which the defendants rely. That it may exist in the lessee or assignee is no defense here. They may not elect to exercise it, but may buy or lease for the express purpose of complying with the -contract. If it be a- sale or lease of the property “fronting” on the viaduct, and ..nothing more, it is difficult to see how they could be benefited without compliance. Their property would be “in-air” until it was physically attached to the viaduct by some structure fronting thereon. Just what is meant by property fronting on the viaduct, at an agreed elevation; and, whether the sale or lease of the property, for railroad -purposes only, would absolve the defendants from the liability to perform, are questions which do not arise upon the petition, and may be reserved for that contingency. It might also become • a question, whether a sale or lease agreed upon for the express purpose .of defeating the- contract could be upheld in equity.

Where the violation of the contract is flagrant, and the injury se- ■ rious, the court will not withhold a decree in specific performance, merely for the reason that there is a possibility, but no pending probability, of its becoming inoperative by a change in the relation of the par-, ties.

As is said by Judge McIlvaine in Dayton, X. & B. Ry. Co. v. Lewton, 20 Ohio St. 401, 411:

“Whether a court of equity has power to decree and means to execute its decrees in such cases, are the ultimate questions in the case, and not preliminary ones.”

If the want of power does not necessarily appear from the facts pleaded; the court should not be called upon to determine that question upon demurrer to the petition.

The demurrer to* the petition will in each case be overruled.