Case ID: tenn_18/html/0179-01.html
Source: Caselaw Access Project
Author: {"author": "\n      GREEN J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Pearl, et. al. vs. Corporation of Nashville.
    Nashville,
    December, 1836.
    A and W contracted with the defendants to supply the town of Nashville with water from the Cumberland river, and to build and keep in repair “water works” fur that purpose. Amo ig other stipulations contained in the contract was the following: “The •said A and W further contract, that if at any time after the completion of said works the same shall get out of repair and so remain for the space of ninety days, so that the town is not supplied with water, as herein piovided, then the mayor and aldermen for the time being, may take possession -of said works in behalf of the corporation, and use and occupy the same as their own, and shall only in such case, be liable to pay the said A and VV the one half of the amount by them expended in the construction thereof, over and above the five thousand dollars advanced as before stated.” The house containing the machinery of the works was burnt down, ar.d never was rebuilt, and the ■works rendered useless. The machinery was left upon the lot. Thomayor and aldermen, after the expiration of ninety days thereafter, took possession of the lot on which the works were erected: Held, that they were liable to pay A and W one half of what they had expended in the construction of the works over the $5000 advanced to them, '•as stipulated in the covenant.
    Equity only has jurisdiction of matters of account, where there are mutual accounts, Jiot where the items of account are all on one side,
    But if proof of the items of an account can-only be had from the defendant, and.a discovery is* sought for and obtained, in such case equity having possession of th,e cause for that purpose, will retain it and give full relief.
    When the remedy at law is inadequate, or embarrassed, and full relief cannot bo liad, equity will entertain jurisdiction and afford relief.
    Where A and ft contracted with C to build water works, &c., and failed to perform .all which was incumbent upon them by the time stipulated, which contract they assigned jto D, and a subsequent contract was made between C and D, adopting in part the contract with A and B, and waiving the non-performance by A and B: Held, that equity would entertain jurisdiction of a bill by T>, to settle the rights of C and D, under both the contracts, the remedy of D, at law, if any, being embarrassed and inadequate to afford full relief.
    In the early part of the year 1826, Avery and Ward entered into a covenant with the corporate authorities of the town of Nashville, whereby the said Avery and Ward undertook to complete a contract which one Samuel Stacker had previously made with the corporation, for the purpose of supplying said town with water, to be raised from Cumberland river by means of steam machinery, and distributed from a reservoir to be provided, through pipes along particular streets mentioned in the contract, at the different intersections of which, and also at the corners of the public square, public hydrants were to be erected. The said contract with J Stacker, had been nut an end to between him and the corporation, after a partial execution of the same, or some imperfect attempt at execution by him the said Samuel Stacker. The covenant of the said Avery and Ward bound them to complete the said waterworks on or before the I st of January, 1827; and they contracted to pay tbe corporation, by way of damages, one hundred dollars per month, for the time said waterworks might be incomplete, or left unfinished, after the said 1st of January, 1827. The corporation was to furnish a piece of ground adjacent to the river for the erection of the machinery necessary in raising the water from the river; and which they did furnish. The said Avery and Ward were to have the use of said ground also for the erection thereon of any machinery of their own, which they might choose to put in operation. The said Avery and Ward erected on said ground a saw-mil!, and so attached it to the machinery of the water works, as to cause it to be propelled by tbe same engine which raised the water from the river for the use of the town. The corporation, by the terms of said covenant, were to advance to said Avery and Ward the sum of five thousand dollars, to be used by them for the space of ten years, without interest; and at the end of the ten years, the principal of the said five thousand dollars was to be accounted for by said Avery and Ward in tbe expenditures made by them upon said enterprise, and whatever excess of expenditure there might be over and above said sum of five thousand dollars, the corporation was to pay to the said Avery and Ward. The said sum of five thousand dollars was to be advanced through tbe year 1826, as the said waterworks were in progress, and in discharge of claims against tbe said Avery and Ward on account of the construction of them; and it was so advanced as admitted by the bill. The said Avery and Ward were likewise to have the exclusive privilege of supplying water from the pipes, which were only to be laid in the streets, to individuals, upon their private account, for the space of ten years, upon such terms as they, the said Avery and Ward, could make with individuJs. At the end of said period of ten years from the completion of the water works, the corporation was to take the said into their own possession, paying to the said Avery and Ward such sum (if any) as they might have expended in their construction, beyond said $5000, up to the period of the completion thereof, under the contract. It was further covenanted, “that if said works should get out of repair at any time after their completion, and so remain for the space of ninety days, so that the town was not supplied with water as herein provided, then the mayor and aldermen for the time being, may take possession of said works in bebalf of the corporation, and use and occupy the same as their own, and shall only in such case, be liable to pay to Avery and Ward the one half of the amount by them expended in the construction thereof, over and above the five thousand dollars advanced as above stated.”
    The 1st of January, 1827, came about, and the said water works were not completed. Avery and Ward dissolved partnership; and in September, 1827, the waterworks not being yet completed, the corporation and Avery alone entered inlo another covenant supplemental to the former, whereby the time for the completion of said water works was extended to the 1st of Januaiy, 1828; and the damages which had accrued under the first contract in consequence of the failure to complete the water works by the time agreed on, were remitted. The second contract also provides, that for the purpose of enabling Avery to proceed in the completion of the water works, the corporation is to loan him a thousand dollars more, for the space of one year, at the end of which time it was to be refunded, with legal interest. And in order to secure the repayment of said sum of a thousand dollars and interest, tlie covenant declares, that the corporation is to be considered as having alien upon ail the machinery and furniture attached to the water works, and also the saw mill. The said sum of $1000 was to be paid to the order of the said Avery, in such sums, and at such times, as the said Avery might call for.the same, in which, he was to be regulated by his progress in the completion of the water works, as far'as practicable. The said second covenant furthermore provided, on °f tliej said Avery to complete said water wor^s Gn or before the 1st day of January, 1S28, in manner as bad been agreed on by the first covenant; be, the said , Avery, was to pay to the corporation, for his failure therein, the sum of five dollars for each day thereafter, during which the said works might remain unfinished, or the said Avery might fail to have a go'od and sufficient supply of water in the reservoir, for the use of the town.
    The bill alleges, that after the water works were completed, on the 1st of January, 1828, the said Avery proceeded to supply, and did supply the said town of Nashville, according to contract, with water, without intermission, except for the necessary repairs of machinery, until about the 9th of March, 1830, when the buildings attached to the said works, and the saw mill, were accidentally destroyed by fire, aud the machinery of the establishment, upon which the supplies of water depended, were thereby rendered useless. That to re-construct the said works would have required a large sum of money, which the said Avery was too poor to raise, and the corporation would not advance it. That therefore the said works have never been rebuilt; and that the corporation has taken possession of its ground upon which the works stood.
    The bill claims of the corporation the sum of $1987 14 cents, as the balance due Avery on account of expenditures made by him in the erection of the works, after crediting the corporation with said sum of $5000 advanced by it, and with the further sum of $040, advanced under the second covenant. The complainant annexes to his bill a complete statement of the account under the two contracts.
    It was alleged in the bill that Avery assigned the contracts to complainants, Dyer Pearl & Co. There was a demurrer to the bill, which was sustained by the chancellor.
    
      J. Campbell, for complainants.
    T. Washington & Geo. S. Yerger, for defendants.
   GREEN J.

delivered the opinion of the court. *

. The first question presented for discussion is, whether in any form of proceeding the complainants are entitled to recover. It is contended for the corporation that the true construction of these covenants gives to Avery, or those claiming under him, no remedy to recover any part of the cost of erecting the water works, because the buildings attached to the water works were destroyed by fire in 1830, which was a contingency not in the minds of the parties when the contract was made, and was not provided for in the covenant. The words of this part of the covenant are, “And they further contract, that if at any time after the completion of said works, the same shall get out of repair, and so remain for the space of ninety days, so that the' town is not supplied with water, as herein provided, then the mayor and aldermen, for the time being, may take possession of said works in behalf of the corporation, and use and occupy the same as their own, and shall only in such case be liable to pay to Avery and Ward, the one half of the amount by them expended in the construction thereof, over and above the five thousand dollars advanced, as before stated.” It is argued that the water works were destroyed by fire, and that the defendants could not take possession of them, which they must have done, in order to give Avery and Ward a right of action. This argument is wholly gratuitous, and is founded upon the supposition of facts not stated in the bill. Upon this subject the bill alleges, that about the 9th of March, 1830, the buildings attached to the said works and the said saw mill were destroyed accidentally by fire, and the machinery of the establishment, upon which the supplies of water depended, were thereby rendered useless.” It is subsequently alleged, that the mayor and aldermen had taken possession of the lot of land on which the water works were erected, having dispossessed the tenants in possession, by action of ejectment. The statement of the bill is, that the houses and saw mill were destroyed, and the machinery thereby rendered useless. This machinery was not destroyed, but remained upon the lot unrepaired, and when the defendant took possess¡on of the lot, possession of the machinery was obtained °i” every thing else appertaining to the water works, which was not destroyed. It would be too absurd for the defendant to contend, that had a single article of machinery, which was necessary to-the complete operation of the works, been destroyed, and had remained unrepaired for ninety days and it had then taken possession, as it has done in this case, it would not have been a possession of the water works, within the meaning of this covenant. But it would he no-cessary so to contend, in order to maintain the position assumed. The water works did not consist only of the house which was desttoyed. The house, the engine, and the machinery for working it, the reservoir, the pipes, the hydrants were but parts of the entire thing, denominated water works. If one hydrant had been knocked down and destroyed, or a pipe for conducting the water had been removed, the water works would have been out of repair. There is no semblance of propriety, therefore, in contending that the destruction of the house was a destruction of the water works, and that consequently the defendant did not take possession of them.

The water works were finished and in full operation, according to the terms of the second contract. The buildings attached to the said works were destroyed by fire, and the works were thereby out of repair., and so remained for more than ninety days, and the mayor and aldermen took possession of the works in behalf of the corporation, and consequently became liable to pay the half of the amount they cost, over and above the five thousand dollars, which had been advanced by it to Avery and Ward.

The statement of the facts of the case in connexion with the terms of the contract, would seem to present a case too plain for debate; nor are there any extrinsic facts which should induce a construction different from that which the face of the covenant would indicate.

The next inquiry is, has a court of chancery jurisdiction cf the case? The first ground upon which its jurisdiction is sought to be supported, is that of account. It is true, account is a head of equity jurisdiction, hut it is so only in cases where there are mutual accounts, and not where the items are all on one side. 1 Story's Equity, § 458, 459: Ves. 687, 688. Here the items are all on one side, and consequently the jurisdiction cannot be supported on that ground. It is true, where proof of the items is to be had only from the defendant, and a discovery is sought and obtained, in such case, equity having possession of the cause for that purpose, will retain if and give full relief. 1 Storey’s Eq. 458. In this bill there is no discovery asked for, and therefore jurisdiction cannot attach on that ground. There are however cases, where the remedy being embarrassed at law, and full relief cannot be afforded there, equity will take jurisdiction. 1 Story’s Eq. § 457. But so far as the question upon the subject of account is presented, wé perceive no other difficulties in this case than must exist in every case where there are many items to be proved.

But in another point of view, we think there would be much difficulty and embarrassment in prosecuting this claim at law, even if relief could at all be administered there. In the first place, as Avery and Ward did not finish the works by the time stipulated in the covenant, they could not maintain an action on that coveiant alone, because they could not aver a performance on their part, nor could the subsequent contract with Avery, by which the non-performance of the first was waived, be relied on by them to excuse an averment of performance. That contract was not made for them, nor for their benefit. It was made with Avery alone, as an individual, and for his individual benefit. An action upon the first covenant could not be sustained by Avery alone, because it was made jointly with him and Ward. He could not couple the agreement which was made with him alone with the first covenant and sue in his own name; for although Ward relinquished his interest in that agreement to Avery, that only vested in him an equity in the covenant, and not a legal right to sue in his own name. * A suit by Avery on the second covenant would be unavailing, because it contains no stipulation to pay the monies expended in the works. Upon the whole, whether these views would have been taken and enforced, had the remedy been sought in a court of law or not, still it cannot but be perceived that much difficulty and embarrassment would have attended an attempt to enforce these agreements at law; and that the remedy would not only have been embarrassed, but inadequate; and this of itself is a ground of equity jurisdiction. Besides this view of the case, it is clear, that if suits could have been sustained at law, two suits would have been necessary, and equity interposes its jurisdiction to prevent a multiplicity of suits. 1 Story’s Eq. § 438, 457. Let the decree of the chancellor be reversed, the demurrer of the defendant overruled, and the cause will be remanded to the chancery court for answer and further proceedings.

Decree reversed.