Block v. Smith

Bunn, C. J., (after stating the facts). The first question that presents itself for our consideration is, was there an abandonment of the purchase, and an election to stand on the alternative part of the contract, to-wit, the lease? By their suit plaintiffs elected to proceed under the lease or rent clause of the contract. The appellants, by their contention, deny that plaintiffs below (and appellees here) had any election in the matter, and from that standpoint contend that “the burden is on appellees to show, by a preponderance of the testimony, some sort of contract whereby Benson became their tenant of the premises for the year 1892, and obligated himself to pay rent therefor.” Equity regards that as done which ought to be done. In the first place, as to the four absent rent notes, we think that all of the notes for the rent were either given to Smith & Hamilton by Benson, and afterwards all except the one were lost or mislaid by them, so that they could not be produced on the trial; or else that, by inadvertence, they were not actually executed and delivered, as was agreed upon, and as was intended, by the terms of the contract, to be executed. In either case, it is but just and equitable that the appellant should be held bound just as if the note of 1892, as well as the other absent notes, had been produced in court, because in equity that which was agreed to be done, and ought to have been done, as a part of the contract, is to be considered as done. Vendee held to have elected to become tenant. It was said in Ish v. Morgan, 48 Ark. 415: “If the contract shows that the defendant was in under an agreement to purchase, the idea of a tenancy was rebutted, and neither Hampton, nor those succeeding to his rights, could evict him by the summary process of unlawful detainer, although he had not strictly complied with the contract of purchase. But if, on the other hand, the meaning of it is, that he is to pay rent, or a compensation for the use of the land, then he was a tenant, and as he held over after the expiration of his term, he could be evicted by the remedy here adopted. The first stipulation of the contract is one of purchase and sale. It binds the vendor to convey to the defendant; but to the terms of this agreement there is annexed the condition that, in case of failure in the performance of the agreement to pay the first installment of purchase money, the intended vendee shall thereafter pay rent for the use of the land. It was certainly competent for the parties to enter into a binding agreement of this nature. The vendor, being unwilling to take the hazard of losing both principal and interest of the purchase price, and the rent of the land as well, may .make a sale upon condition, and give the vendee an option to hold as purchaser or as tenant after a given day. The vendee here has in effect agreed that his rights shall depend upon the scrupulous adherence to the engagement he made to pay the purchase price, and that time should be a material consideration in the contract.’’ The vendee in that case, having failed to pay the first installment of purchase money when due, was held in effect to have, by his failure, elected to become the tenant of the vendor, under the rent clause of the contract, and was subjected to the burden of a mere tenant. It is apparent that a contract may be drawn in which the vendor might have the option to stand on either clause after default by the vendee. But it *is unnecessary to do more than suggest this here, since we hold that by the absolute terms of the contract now under consideration the option was with the vendee, and by his default in payment of either of his purchase money notes when due, he has made his election. So, then, it required no evidence on the part of the plaintiffs to establish their right of action on the rent note, except that default in payment of some one of the purchase money notes had been made, and that they were the legal owners of the note sued on. That default in the purchase money had been made- by appellants is shown without controversy, and, that being the case, the right of action in the owners of the rent notes follows as a conclusion upon a proper construction of the contract. The doctrine of the case of Ish v. Morgan, supra, is in effect re-affirmed in Quertermous v. Hatfield, 54 Ark. 16, for the doctrine in both cases is simply that men are bound by the terms of their contracts, which they may lawfully make, and that these contracts are such as they lawfully may make. It is contended, under this head, that “the mere failure of the defendant (Benson), therefore, to make payment at the time named did not extinguish his equitable rights.” That is true, at least in most cases, where the defeasance is absolute, and no alternative contractual relation is created or provided in the contract itself ; and this distinction will appear by a close examination of nearly all, if not quits all, the authorities cited by them in support of the contention. Thus, differently from those in the case at bar, do the facts appear in the following cases cited by appellant: Converse v. Blumrich, 14 Mich. 109; (90 Am. Dec. 230) Sornborger v. Berggren, 30 N. W. (Neb.) 413; Coles v. Shepard, 16 N. W. 153 (Minn.); Orr v. State, 56 Ark. 107; Gibbs v. Champion, 3 Ohio, 335; O'Connor v. Hughes, 29 N. W. (Minn.) 152; and Duryee v. Mayor, 96 N. Y. 477. In C. B. & Q. Ry. Co. v. Skupa, 20 N. W. (Neb.), 393, and Robinson v. Cheney, 24 N. W. (Neb.), 378, there are apparent likenesses to the case at bar, but each of them seems to have gone off on the manner in which the vendor declared the forfeiture, rather than the existence of an alternative contract that should or should not have been acted upon. In the first of the two cases, the court merely construed a peculiar statute of Nebraska on the subject of unlawful detainer ; and in the second case, the equities rendered a forfeiture of the contract of purchase unconscionable under the peculiar state of facts. Much of the discussion, in those cases where it is provided that on failure of the vendee to pay installments of the purchase money the vendor may treat the contract of sale as at an end, is with reference to the effect of a provision that time shall be of the essence of the contract, always designed for the purpose of giving an option to the vendor to declare a forfeiture of the contract of purchase on default of performance on the part of the vendee. We have no occasion to enter into such a discussion, for it is altogether foreign to the case under consideration. landlord’s lien is not assignable. The more difficult question for us to determine grows out of the fact that the rent note sued on, and which is sought to be made a lien on certain cotton raised by Benson on the lands in question during the year 1892, was purchased by appellees, Smith, Graham & Jones, from their co-appellees, before the institution of this suit. It is contended by appellants that the landlord’s lien for rent on the crop of the tenant is personal to himself, and is not assignable, so as to vest the right of action as to the lien in the assignee. This is certainly true, and is the doctrine of Varner v. Rice, 39 Ark. 344, Nolen v. Royston, 36 Ark. 561, and Roberts v. Jacks, 31 Ark. 597. That is to say, it goes without question or controversy, in this state, that the assignee of a rent note has his action at law for recovery on the note, but has no right at law or in equity to have the landlord’s lien enforced in his favor; for, as has been said, the lien is personal to the landlord himself, and is not assignable ; or, as stated by this court in Nolen v. Royston, supra, “is not assignable, so as to give a right of action in the assignee.” The only evidence of the transfer of these rent notes, or rent claim, by Smith & Hamilton to Smith, Graham & Jones, is the testimony of Smith, a member of each of the firms and partnerships, who simply states “that, under the terms of this contract, they (he and Hamilton) claimed that Benson was their tenant of the premises described in the complaint in the year 1892 ; that the land they were seeking to recover rent for is the same land they had sold Benson under this contract; that Smith, Graham & Jones succeeded Hamilton and himself in business, and were the owners of all rights under the contract with Benson.” Now, whether this language is to be construed to mean that the firm of Smith, Graham & Jones are the assignees and absolute owners of the rent notes; or “are the owners of all rights (of Smith & Hamilton) under the contract with Benson,” as the witness has it, is a question of fact about which we have had some difficulty in coming to a conclusion. If the one is true, the other cannot be true, because if the note has been absolutely assigned, the legal and equitable right, once united in Smith & Hamilton, have been separated, and ifi that case Smith, Graham & Jones have the sole and exclusive right to the remedy to recover the debt, and nothing more; the court holding that the evidence shows there has been an absolute assignment or transfor of the debt. The decree is affirmed as to the debt against Benson, and reversed as to the lien, and also as to the debt against Block.