Battell v. Matot

The opinion of the court was delivered by Rowell, J. The objection of a former suit pending must be taken by plea and not by answer. This would seem to follow from the practice, which is, not to reply to such a plea, nor to set it down for argument, but to refer it on motion at once and of course to a master, to ascertain and report whether or not both suits are for the same matter; and if they are found to be, the plea is allowed, and if they are found not to be, it is overruled. Story’s Eq. Pl. s. 743. But the plaintiff may except to the master’s report, and bring the matter on to be argued before the court; and if he conceives the plea to be defective in form or otherwise, independent of the mere truth of the matter pleaded, he may set down the plea to be argued as in the case of pleas in — 282 — general. Tyler’s Mitford,^393. But if lie sets the plea down to be argued, he admits the truth of it, and it must be allowed if not defective. Story’s Eq. PI. s. 743. There is an anonymous case in Mosely, 268, in which it is said that though this objection must be taken by plea in the Court of Exchequer, it may be taken by motion in the Court of Chancery. But in Murray v. Shadwell, 17 Ves. 353, Lord Eldon said he could find nothing in support of the motion except that case in Mosely, and that on looking into his own notes he found nothing confirming that case, nor in the books of practice, according to which the regular way of obtaining the reference was by plea. In Hertell v. Van Buren, 3 Edw. Ch. 20, the objection was taken by answer, and the Vice-Chancellor held that it was not taken in the proper manner to enable the court to dispose of it, as it ought to have been taken at an earlier stage of the case, and therefore could not be allowed to prevail at the hearing. The practice is different when two suits are brought in the name of an infant. In such case it is a motion of course to obtain a reference on the statement of counsel that both suits are for the same purpose, to see which of them is most for the infant’s benefit, and so most proper to be proceeded with. Sullivan v. Sullivan, 2 Meriv. 40. But in 2 Hov. Sup. 481, it is said that this indulgence to an infant plaintiff is no reason why an adult defendant should obtain by motion what he ought to ask by plea. The defendant moved before hearing that the orator be ordered to file his former biLl of complaint in coui't; but the Chancellor overruled the motion on terms as to costs and without prejudice to the defendant’s right to insist at the hearing on so, much of his answer as relates to the pendency of the former suit or to substantiate such defence. But this does not enlarge the defendant’s right in this behalf, but simply reserves it to him for what it is worth. The orator in the original bill puts his case on the ground — 283 — that the contract in question is within the Statute of Frauds, and also that the defendant has broken it by not furnishing the stipulated security. To the first ground the defendant objects that the question of the statute is not raised by the hill, and that therefore the orator cannot avail himself of it. • The hill sets out the substance of the contract, and alleges that it was “ a verbal contract, never reduced to writing in any form,” and that, even if the proper security had been furnished by the defendant, which it denies, the contract “ invests the defendant with no title to or legal interest in the trees uncut and standing upon said land ” ; but no reference is made to the statute except what may be inferred from the language qu oted. But the orator says that although he has not mentioned the statute in terms, he has stated facts that bring his case within it, which is enough, as to do more would be to plead a mere conclusion of law, which is unnecessary; and although this is certainly a general rule of pleading, both at law and in equity, yet the question must be determined by the practice that prevails in chancery rather than by any general rule of pleading. . In-most of the books and cases the question is discussed with reference to the sufficiency of pleas and answers, as it is generally the defendant that seeks the aid of the statute; but the same rule must apply whichever party seeks its aid, and it is a question of equity pleading, and as applicable to one party or to one kind of pleading as to another. It was formerly held that specific performance should be decreed when the answer admitted the verbal agreement, although it insisted on the statute. Child v. Comber, 3 Swanst. 423, n. But it is now settled that though a verbal agreement be admitted, yet will not specific performance he decreed if the statute is insisted upon. 2 Story’s Eq. Jur. s. 757. But the language setting up the statute must be clear and explicit to that end. Browne on Fraud, s. 519. Mr. Pomeroy says that when a verbal contract is alleged by the — 284 — plaintiff and the defendant admits it without at the same time interposing the statute as a defence, the contract will be established and enforced; and that the true ground of the rule is, that an admission of the contract without at the same time setting up the impossibility of enforcing it resulting from the statute, is a deliberate and formal waiver of all benefit that might have been derived from it, this benefit being personal, and therefore capable of being waived. Pomeroy Cont. s. 140. Mr. Waterman says that when a defendant admits a verbal contract, if he desires to claim the benefit of the statute he must do so distinctly at the time he admits it. Waterman Spec. Perf. s. 103; 2 Dan. Ch. Pr. 751,* n. (1). In Spurrier v. Fitzgerald, 6 Ves. 548, the Master of the Rolls said the defendant ought to have interposed the guard of the statute at the time she admitted the agreement, and that it was then incumbent on her to say whether she would avail herself of it. Beatson v. Nicholson, 6 Jur. 620, was a suit for the specific performance of an agreement to accept a lease. The defendant by his answer admitted the agreement, and said that at the expiration of the three years mentioned in it he applied to the plaintiff to grant him a lease upon the terms thereof, but whether such request was made in writing he did not remember; and he submitted that he was at liberty to revoke such request, and that he was not bound to accept a lease. The statute was relied on at the bar by the defendant’s counsel, but that defence was not in terms set up by the answer. Vice-Chancellor Wig-ram said that he did not see how the statute had any bearing on the case, but if it had,, that the rule laid down in Spurrier v. Fitzgerald, 6 Ves. 548, with respect to a defendant taking advantage of the statute, would preclude the defendant; and he went onto say: “I do not mean that he must claim the benefit in the very words of the statute, but he must claim it in words equivalent, so as to call the attention of the plaintiff to the circumstance that the benefit of the statute is claimed.” Skinner v. M’Douall, 2 De G. & Sm. — 285 — 265, was a suit to enforce specific performance of an agreement to take a house. The bill alleged that though no formal note of the agreement was ever made, yet that the same was proved and made out by the letters of the defendant and his agent. The defendant by his answer alleged that no formal note of the agreement charged by the bill was ever made, and denied that he had ever entered into any binding agreement, but he did not expressly claim the benefit of the statute, and it was held at the hearing that he was not entitled to the benefit of it. In Ridgway v. Wharton, 3 De G., M. & G. 677, the defendant by his answer denied the authority of his agent to make the agreement sought to be enforced, and stated his belief that no note or memorandum in writing was ever made of any lease to be granted by him to the plaintiff, but did not set up the statute. The Lord Chancellor Cranworth held that he was entitled to the benefit of the statute at the hearing because he had denied the agreement, and stated the rule thus: “When a defendant admits the agreement, if he means to rely on the fact of its not being in writing and signed, and so being invalid by reason of the statute, he must say so, otherwise he is taken to mean that the admitted agreement was a written agreement, good under the statute, or else that on some other ground it is binding on him; but when he denies or does not admit the agreement, the burden of proof is altogether on the plaintiff, who must then prove a valid agreement capable of being enforced.” This case seems to have been questioned or denied as to the latter part of this rule in Heys v. Astley, 4 De G., J. & S. 34, and Homfray v. Fothergill, L. R. 1 Eq. Cas. 567; and in the former case, alth ougli the existence of the agreement sought to be enforced was denied, yet Lord Justice Knight Bruce said that in his judgment, according to the rules and course of the court, the statute not having been set up, it could not be resorted to. But in this country the rule in this last point seems to be as stated by Lord Cranworth. Waterman Spec. — 286 — Perf. s. 103; Ontario Bank v. Root, 3 Paige, 478. We are not, however, prepared to adopt what his Lordship says is the effect of admitting the agreement without insisting upon the statute, for it is obvious that for many reasons outside of the statute the party would be at liberty to contend that the agreement was not binding upon him notwithstanding he had admitted the making of it. We think the time legal effect of the omission to set up the statute is as stated by Mr. Pomeroy, and by Lord Eldon in Cooth v. Jackson, 6 Ves. 12, where he says: “ If the defendant admits the agreement, * * * but does not say anything about the statute, he must be taken to renounce the benefit of it, and there is no occasion to inquire about the part performance.” In view of these authorities it must be held that the orator, by not expressly insisting on the statute in his bill, has renounced the benefit of it as a ground of relief. We now come to the consideration of the cross-bill. By it the orator therein admits the contract to have been verbal, but insists that it is not within the statute, and if it is, that it is sufficiently evidenced by the deed from Treadway to Battell and the other writings that passed between them to satisfy the statute, and if not, that he has so far performed it as to be entitled to have it specifically enforced. The defendant Wright, by his answer, admits the contract on information and belief, but expressly interposes the defence of the statute. The defendant Battell, by his answer, in substance admits the contract, but does not interpose the defence of the statute. The most he says about it is, that “ he made his purchase, believing that the orator had no legal right, by reason of the absence of any written memorandum of the contract ”; and by way of answering an allegation in the cross-bill to that effect, “ denies that said instruments executed by and between the said Tread-way and the defendant constitute any legal memorandum of the verbal contract between the orator and Treadway, sufficient to obviate the effect of the Statute of Frauds ap — 287 — plicable thereto ”; “ denies that he is equitably or morally bound to carry out said agreement, or that either he or Treadway at the time of his purchase of the premises had, or that he has since had, any understanding that either he or Treadway was bound by said contract or intended to carry the same into effect;” and “ denies that the orator is entitled to any relief whatever in the' premises.” This, as shown by the authorities already referred to, is not setting up the statute with sufficient certainty to entitle this defendant to avail himself of it. As to Battell then, the case stands, that he admits the contract but does not insist upon the statute, and this leaves the contract to be enforced against him, if the orator is otherwise entitled to have it enforced; for when a verbal contract is alleged in the bill and admitted in the answer without at the same time interposing the statute as a defence, ground is furnished on which a court of equity will specifically enforce the contract notwithstanding the statute, and no' part performance is requisite; in other words, the case is thereby taken out of the mischief of the statute. Pomeroy Cont. s. 140, and cases cited above. And still further; we think this defendant is precluded from setting up the statute as a defence to the cross-bill because of his renunciation of it by not insisting upon it in his original bill; for the effect of such a renunciation is permanent, and not confined to the issue raised by those identical pleadings. Thus, if, having made such a renunciation, the party dies before decree, the effect will be extended to and bind his heirs and personal representatives, and the contract could be enforced against them in the suit revived for that purpose. Pomeroy Cont. s. 141; Attorney General v. Day, 1 Ves. Sen. 218, 221. And after admitting the con-trace without setting up the statute, a defendant will not be permitted to insist upon it in answer to the bill as amended. Pomeroy Cont. s. 141; Spurrier v. Fitzgerald, 6 Ves. 548, 555. And in Patterson v. Ware, 10 Ala. 444, the — 288 — defendant, having admitted a contract in his answer without setting up the statute, was not permitted to set it up in answer to the bill amended so as to allege the contract he had admitted. It may seem at first sight that the law of this subject is rather too narrow and technical to be sensible; but we become reconciled to it when we consider that a party who admits a contract in his pleading, thus obviating the very danger the statute was intended to guard against, himself stands on pretty narrow ground morally and equitably when he asks to have that contract nullified as far as unexecuted solely because it does not happen to have been reduced to writing. But it is contended that Matot is not entitled to have the contract specifically enforced because he has not furnished the stipulated security. Treadway was so far satisfied with Clark’s letter touching the matter of security that he “ authorized Matot to proceed with the work,” and he proceeded accordingly; and although Treadway represented to Battell that Matot had broken the contract in not furnishing the security, yet at the time Treadway sold to Battell he had never complained to Matot about that nor anything else, nor notified him to quit, and Matot did not know that Tread-way made any claim that he “had forfeited and lost all rights” under the contract until Treadway’s assignment of the contract to Battell was produced before the master. If in respect of furnishing security, time is to be regarded as essential under the original contract, that quality of it was waived by Treadway when he authorized Matot to proceed with the work without furnishing security as stipulated; for the essentiality of time is matter of intention, and may be waived by the party entitled to insist upon it, and is waived by conduct on his part that shows he could not consistently have intended to insist upon it, or that he intended to treat the contract as still — 289 — subsisting notwithstanding the delay. And when the essentiality of time has been waived, it cannot be revived again without notice to the party in default, fixing a certain and reasonable time within which he is required to perform, in which case the time thus allotted becomes essential, and if the party neglects to perform within it, a court of equity will not aid him to enforce the contract, but leave him to whatever legal remedy he may have. Pomeroy Cont. s. 395 and passim. On the same principle, when performance of a contract has been prevented by one party, the other party, in decreeing specific performance, will be given a reasonable further time in which to perform. There has been such prevention in this case by the injunctions. And it may be that by reason of the delay occasioned by the injunctions, Matot cannot now furnish the railroad company’s guaranty as stipulated; if so, he is entitled, within a short time to be fixed, to furnish other good and sufficient security instead, to be approved by the Court of Chancery. As Treadway’s estate has no interest in this controversy, and as the orator in the cross-bill needs no decree against the administrator thereof if he could have it — as to which we have not inquired — we deem it best to dismiss the cross-bill as to the defendant Wright, with costs. Decree reversed and cause remanded, with mandate. Powers and Tart, JJ., did not sit.