Hayes v. New York Gold Mining Co.

Hallett, C. J. The bond upon which this action is founded shows that Hayes, the principal obligor, was in possession of the Enterprise mill, under a lease from defendant in error, and that he had sold to the latter, two boilers and one engine, then in the mill, to be delivered at the expiration of his term. The conditions of the bond require Hayes to surrender the mill, and the engine and boilers, in as good repair as they then were, at the expiration of the lease ; to perfect the title to the engine, and to pay the taxes assessed against the property for the years 1869 and 1870. In the declaration, breaches were assigned upon each of these conditions, and as we had occasion to say in another cause, each of the breaches so assigned, in connection with the body of the declaration, is to be regarded as a separate count. Sopris v. Lilly et al., 1 Col. 266. Six pleas were interposed by plaintiffs in error, to which a demurrer was sustained, and we are asked to review the action of the court in respect to them. The first plea was non damnificatus, which may be pleaded in an action upon a bond to indemnify and save harmless, but not when the bond is conditioned for the performance of such acts as were specified in this instrument. McClure v. Erwin, 3 Cow. 332; The State v. Gresham, 1 Ind. 190. In the second, fourth and fifth pleas, it is alleged that the boilers and engine were attached to, and became part of, the realty, on the 24th day of May, 1870, and that defendant in error was not the owner of the estate at the time the bond was made, or subsequently. Considered with reference to the undertaking to sell and deliver the engine and boilers, the defense set up in these pleas is, in substance, that, at the time of sale, these articles were attached to the freehold of some one not a party to the contract. If from this we — 277 — are to understand that the subject of sale was the property of a stranger, the action stands confessed, for one of the breaches of the condition of the bond assigned in the declaration is, that Hayes was not the owner of the engine at the time of the sale to defendant in error. If, on the other hand, the purpose of these pleas was to show a right of action on the bond in the owner of the freehold, it is plain that they have not that effect. According to the pleas, defendant in error was not the owner of the land at the time the bond was given, and, therefore, the right of action upon the bond could not pass to an assignee of the land. Spencer’s case, 1 Smith’s L. C. (5th Am. ed.) 125. Hayes was a tenant in possession of the property, and the boilers and engine, if owned by him, were trade fixtures which he had a right to remove during the tenancy. Taylor’s L. &, T. (5th ed.), § 545. If he owned them, he could sell them as personal property ; and, if he did not own them, he is liable in damages for his failure to perform his contract. The third plea presents a different question. It is there alleged that the Enterprise mill was, on the 24th day of August, 1869, sold under several executions, issued upon judgments previously obtained against defendant in error; and that in pursuance of such sale, on the 20th day of March, 1871, Ralston & Burke obtained a sheriff’s deed for the property. It is also alleged that the boilers and engine were attached to, and became part of, the realty on the 2.4th day of May, 1870, which, it will be remembered, was prior to the making of the bond and the sheriff’s deed. It is also alleged that defendant in error was owner of the mill at the time the judgments were obtained, and that the property was sold to satisfy the judgments. Upon this plea, it appears that defendant in error was the owner of the legal estate in the mill property at the time the engine and boilers' were attached to it, and at the date of the bond, for the title was not divested by the sale under execution. Catlin v. Jackson, 8 Johns. 406; Gorham v. Wing, 10 Mich. 486. Afterward, however, and on the 20th day of March, — 278 — 1871, the mill was conveyed to Ralston & Burke by the sheriff’s deed, and this was prior to the forfeiture of the bond. It is true that the purchasers at the sheriff’s sale acquired no right to the boilers and engine at the time of the sale, as those articles were not then in the mill. But they were subsequently attached to the freehold by Hayes, and thus became part of the realty, subject to the tenant’s right of removal. Note to Elwer v. Mawe, 2 Smith’s L. C. By the sale to defendant in error, the right of removal was extinguished, and the title to the fixtures united with the fee of the land. Buildings erected by a tenant, under a covenant to surrender them at the end of the term, cannot be removed by the tenant, and the same rule must obtain in regard to all fixtures placed upon land by a tenant, under an agreement to surrender them with the land at the end of the term. Taylor’s L. & T. (5th ed.), § 549. A condition of the bond in suit is, that the mill and its appurtenances, and the boilers and engine, shall be surrendered at the end of the term in good repair, which is similar to the covenant referred to in Mr. Taylor’s text. After the sale by Hayes, the relation of the fixtures to the land was the same as if they had been erected under an agreement to surrender them at the end of the term, which would make them part of the realty, for all purposes. This being true, they would pass with the land by any conveyance effectual to transfer it. Preston v. Briggs, 16 Vt. 124; Kittridge v. Woods, 3 N. H. 503. It is considered that fixtures erected upon land by a mortgagor, after the lien of the mortgage has attached, are subject to it, and the same rule appears to be applicable to land sold upon execution. Roberts v. The Dauphin, 19 Penn. St. 71. It is said that crops sown after a sale upon execution, and which have not been harvested at the date of conveyance, pass to the vendee (Parker v. Storts, 15 Ohio St. 351), and upon the same principle, all fixtures annexed to the land at the time of the conveyance must pass with the freehold. — 279 — This brings us to the principal question in this case, which is, whether the covenants in the bond are such as run with the land and passed to the grantees in.the sheriff’s deed. As we have seen, the obligee in the bond on the 28th November, 1870, the date of the instrument, was the owner of the mill, which was essential in order that the covenants might take effect upon the land. But the assignable quality of the covenants did not depend on the interest of the obligors in the land, since a covenant by a stranger to the estate may pass with it. Spencer's case, 1 Smith’s Lead. Cases, 125. The form of the obligation is not material, for a covenant may be contained in an exception or proviso, or any words which evince the intention of the parties. Taylor’s L. & T., § 248, et seq. What, then, is the legal effect of the bond in suit, considered with reference to the mill property therein described, which, at the time the bond was given, was in possession of Hayes as tenant to defendant in error? That it was intended to secure the due performance of certain acts respecting the estate demised to Hayes is expressly declared in the condition of the bond, and since the boilers and engine had become part of the realty, all the acts there specified refer to the realty alone. They were acts affecting the quality and value of the premises demised, and therefore within the definition of real covenants which run with the land. Taylor’s L. & T., § 261; Rawle on Covenants for Title, 334. Express authorities are not wanting to show that the conditions to surrender the premises in good repair, and to pay taxes, are covenants real, and as the engine was annexed to the land, the condition to perfect the title to it was equally so. Taylor’s L. & T., § 262. Respecting the covenants to perfect the title to the engine, as well as the other conditions in the bond, it. is to' be observed that they were not to be performed until the 20th day of April, 1871, and, therefore, it cannot be said that they were broken as soon as made, and that thereby defendant in error became invested with an immediate right of action. — 280 — At the time designated for performing the conditions, the estate had passed to Ralston and Burke under the sheriff s deed, and therefore there was then no right of action in defendant in error. It is well settled that covenants real pass with the land to which they are annexed, to a purchaser at a sale under execution. Rawle on Covenants for Title, 352. I have not found any case in which the rule has been applied to a covenant which attached to the land after the sale, and before conveyance by the sheriff, as in this case. But it is believed that the principle is applicable to such covenants, and to whatever estate is acquired by the judgment debtor prior to the conveyance by the sheriff. Any other rule would divorce the covenant from the land for the benefit of which it was intended, and practically annul its obligation. The judgment debtor, not having the estate in the land, can suffer no injury from the breach, and if the grantee in the sheriff’s deed cannot sustain an action upon the covenant, it would appear that no one would have such right. It is very certain that the judgment debtor is divested of the right of action, and if it is not extinguished, it must pass to the assignee of the land. Our conclusion is, that the facts set forth in the third plea are sufficient to bar the action, and it remains to consider the sufficiency of the sixth plea, concerning which very little need be said. In this plea it is alleged that defendant in error was not the owner of the Enterprise mill and appurtenances at the commencement of the suit, and had never been evicted or ousted therefrom. If the corporation was the owner of the premises at the time the condition of the bond is alleged to have been broken, the right of action then accrued, and the ownership at the commencement of the suit is of no importance. As to the averment that defendant in error had not been evicted, I do not discover any thing in the declaration to which it can be applied. There is no covenant in the bond for quiet enjoyment, nor did defendant in error complain of a disturbance of the possession. The plea is clearly insufficient, and the demurrer was very properly sustained to it. — 281 — The third plea is, however, good, and therefore the judgment of the district court is reversed and the cause remanded, with directions to that court to enter judgment for plaintiffs in error on the demurrer to that plea. Reversed.