Pittsburg, Ft. Wayne & Chicago Railroad v. Reno

Bailey, J. The first question to be considered is as to the proper construction to be given to the covenant upon which the suit was brought. Said covenant is in these words : “ And it is further so agreed between the parties hereto, that said second party shall, on taking possession of the premises so hereinbefore described, restore all the switch connections now existing between said second party and said first party, or any of them, and continue to them the use of the same hereafter as heretofore.” The defendant claims that this covenant was fully performed by restoring the switch connections between its tracks and Reno & Little’s coal yard, after the construction of its two additional tracks, and delivering coal over the same to Reno & Little free of switching charges, down to the. time the switch tracks were removed and the connection interrupted by the Chicago, Burlington & Quincy Railroad Company. To this view we are unable to assent. For a number of years prior to the execution of said covenant the switch connections between the defendant’s railway tracks and Reno & Little’s coal yard had been in existence, and during all that time the defendant had delivered to Reno & Little, free of switching charges, the coal consigned to them over its own road or that of the Chicago & Alton Railroad Company. Whatever may have been the defendant’s legal duty in the premises, such was its uniform practice. The plaintiffs, on selling to the defendant the lots in question, saw fit to exact as a part of the consideration, a covenant to restore the switch connections which were to be interrupted by the construction of railway tracks on the lots sold, and to continue to them the use of such switch connections thereafter in the same manner and upon the same terms as had been accorded to them in the past. It may be admitted that prior to the execution of the covenant the defendant was under no legal obligation to deliver coal at said coal yard without the exaction of reasonable switching charges, for even if that is so, the manifest design of the covenant was to change that which before was a matter of favor into a matter of contract. What the defendant had voluntarily chosen to do in the past, it agreed and bound itself to do in the future. There being no limitation in the covenant as to the time during which such use of the switch connection was to be continued to the covenantees, it should be construed, we think, to be perpetual. Other constructions are suggested, having some degree of plausibility, but an application of the rule, that a covenant should be construed most strongly against the covenantor, necessitates the construction we have adopted. We are also of the opinion that said covenant is nota mere personal covenant, but a covenant running with the land of the covenantees as a benefit thereto. It is true the heirs and assigns of the covenantees are not mentioned or referred to in the covenant. That, however, is not necessary to con-titute it a covenant running with the land. The common-law rule, that where the heirs are not mentioned the covenant will be binding only on the covenantor', his executors and administrators, does not apply to real covenants running with the land granted or demised, or to which the covenants are attached for the purpose of securing to one party the full benefit of the grant or demise, or to the other party the consideration on which the grant or demise was made. Morse v. Aldrich, 19 Pick. 499 ; Platt on Covenants, 65. A covenant by a grantee of one parcel of land for the benefit of other adjacent land of the grantor, will pass to a subsequent assignee of the latter tract, and may be enforced by him against the original covenantor. Woodruff v. Trenton W. P. Co., 10 N. J. Eq. 489; Lydick v. B. & O. R. R Co., 17 W. Va. 427. In the case last cited a right of way through land was granted to a railroad company, and in the deed, as the consideration for such grant, the railroad company covenanted with the grantor, his heirs and assigns, to build and forever maintain a switch track from said railroad to a mill on the land, and it was held that said covenant was a covenant real and run with the mill. In Stark v. Waterhouse, 7 El. & Bl. 816, the owners of a fulling-mill, dye-house, etc., were granted by deed the right of draining refuse onto the land of another, and in said deed they covenanted, in consideration of such grant, at all times thereafter, to supply to the grantor, his heirs and assigns, pure water sufficient for the consumption of his horses, cattle, etc., and it was held by the court and admitted by counsel that the covenant run with the land on which the animals were thus to be supplied with water. The doctrine of the foregoing cases seems to be in harmony with all the authorities, and applies to the case before us. The covenant sued on was by the express terms of the contract made a part of the consideration of the conveyance to the covenantor of a portion of the land belonging to the covenantees. The consideration recited in the contract is, “ the money to be paid, and the covenants, as herein expressed, to be performed by the party of the second part.” There is nothing in the nature or character of the covenant which may not properly belong to a covenant- running with the land. It stipulates, first, for a restoration of the switch connections which, as the parties anticipated, were to be temporarily interrupted, and, second, the operation of such switch connections by the.defendant for the benefit of the covenantees, and free of charge to them, by the use of its locomotive engines and the personal services of its employes. The only doubt is whether the second division of the covenant is the proper subject of a covenant real. That it is, seems to be established by the authorities. The following casé, cited by Lord Coke, may be referred to as fairly illustrating the principle involved : “A, seized of the manor of D, whereof a chapel was parcel, a prior, with the assent of his convent, covenanteth by deed indented with A and his heirs, to celebrate divine service in his said chapel weekly, for the lord of said manor, his servants, etc. In this case the assignees shall have an action of covenant ; albeit they were not named, for that the remedy by covenant doth run with the land, to give damages to the party aggrieved, and was in a manner appurtenant to the manor.” Coke on Litt. 385. A question which counsel for the defendant have pressed upon our attention with great earnestness, relates to the nature and extent of the damages recoverable in this suit. The plaintiffs, after alleging in their declaration a "breach by the defendant of its covenant to restore said switch connection and to continue to the covenantees the use of the same, allege damages to Sarah A. Reno and Eugenia M. Little, the owners of the lots, from a depreciation of their permanent and rental value, and also damages to Charles A. Reno and Jacob H. Little, from damage to their business as coal dealers, by reason of the failure of the defendant to transfer from its tracks into their coal yard the coal consigned to them free of switching or transfer charges. At the trial the plaintiffs were permitted to give evidence to establish both species of damages, and damages of both species are, presumably, embraced in the verdict of the jury, "though in what proportions the evidence furnishes no criterion to determine. It is claimed that this is in substance a misjoinder of actions; that the convenant is several as to the coven mtees, and tint separate actions should have been brought by Reno & Little on the one hand, and the owners of the lots on the other, to recover damages for its breach. We think that the position taken by counsel grows out of a misconception of the nature of the covenant and of the rules of law applicable to it. While the interests of the several covenantees are variously affected by its breach, the covenant is not for the performance of several duties to each, but of one and the same duty to all. Doubtless if it had been provided for the performance of one duty to Reno & Little and another separate duty to Mrs. Reno and Mrs. Little, it would have been several, and separate actions might have been brought, but such is not the case. It is a mistake to suppose that there is any joinder here of two separate causes of action. The cause of action is one, viz., a breach of the covenant to restore the switch connections and to continue their use to the covenantees. This covenant runs to all .alike and is therefore joint. The different covenantees have several interests, not in the covenant itself, but merely in the subject to which the covenant relates. The true doctrine applicaCe to this question is laid down by Lord Kenyon in Anderson v. Martindale, 1 East, 497. That was a suit upon a covenant to and with A, his executors, administrators and assigns, and to and with B and her assigns, to pay an annuity to A, his executors, etc., during B’s life. A having died, suit was brought on the covenant by his administrator, although B, the other covenantee, was still living. His Lordship, in holding that the action could not be maintained, said: “ Here is a covenant to two to pay an annuity to one of them ; shall both bring actions for the same interest where only one dpty is to be paid ? Which of them ought to recover for the non-performance of the covenant ? The defendant is only bound to pay the annuity once. This is different, therefore, from the case put by Lord Coke, where the covenant is several for the performance of several duties to each ; there the covenant shall be molded according to the several interests of the parties, and each shall recover for a breach so far as his own interests extend. It has been assumed in the argument for the plaintiff that the covenantees had different interests, but that is not so; the covenant was for the same thing; and though the benefit was only to one of them, yet both had a legal interest in the performance of it ; and therefore the legal interest being jointly during the lives of both, on the death of one of them, survived to the other. If, indeed, the covenant had bem to each by two different deeds,, though for the same duty, there could not have been a joinder in action ; but here the parties claim by the same title, and therefore the law coincides with the justice and convenience of the case.” In Shephard’s Touchstone, 166, the learned author, following the authority of Slingsby’s Case, 5 Coke, 188, lays down the rule as follows: “ In cases where the covenantees have, or are to have, several interests or estates there, then the covenant is made to and with the covenantees, et cum guoUbet eorum, aut altero eoru/m¡ in this case these words make the covenant several : as if one by indenture demise Black-acre to A and White-acre to B and Green-acre to C, and covenant with them, and every of them, that he is lawful owner of all these acres; in this case the covenant is several. But if he demise to them the three acres together, and covenant in this manner, the covenant is joint and not several.” In Bradburne v. Botfield, 14 Mees. & W. 559, the proprietors of certain coal mines, who each held certain undivided interests therein, executed a lease thereof, according to their several estates, rights and interests therein, to certain lessees, reserving therein rent to said lessees respectively, and to their respective heirs and assigns, according to their respective estates, rights and interests in the premises, the lessees covenanting with all of said lessees, and each and every of them, and each and every of their heirs, executors, administrators and assigns, to repair the premises and to surrender them in good repair to the lessors, their heirs and assigns respectively, at the end of the term, and to work the mines properly. Suit was brought by a plaintiff who had acquired title from one of the lessors to a moiety of the premises, the breach of the covenant alleged being a non-repair and an improper working of the mines. It appeared that one of the covenantees was still living, and it was held that the covenant was joint and not several, and that the surviving covenantee ought to have brought suit. Foley v. Addenbrooke, 4 A. & E. (N. S.), 197, was a suit upon certain covenants in a lease, the facts being in most respects similar to those in the case last cited; and the court, holding that the covenant was joint,-say: “We are of the opinion that the demise being joint and the covenants upon which the action is brought entire, and made with both the lessors, the cause of action is joint, and that both the covenantees ought to sue, though, as between themselves, their interests may he separate.” Many other authorities of like purport might he cited, but the foregoing we think will sufficiently illustrate the rule of law applicable to this question. The covenant here being with all the covenantees,to do a single act or class of acts, is necessarily entire and incapable of severance, and must therefore be held to be joint and not several. In order then to maintain any action upon it, all the surviving covenantees must be joined as plaintiffs, and it follows that all damages arising from its breach, which are recoverable at all, must be recovered in the same suit. Mor does there seem to be any legal obstacle in the way of such recovery. So long as the legal title to the covenant is in all the covenantees jointly, it follows as a necessary consequence that the legal title to all damages resulting from its breach is vested in them. True, the different covenantees are damnified in different proportions, and the damages suffered by Meno & Little, the tenants in possession, are different not only in their amount, but in their nature, from those suffered by the owners of the reversion. That, howevez1, only affects their equitable rights as between themselves in the apportionment of the damages when the same are recovered. It is uz’ged that great inconvenience arises from this rule in cases like the present, where tliez-e is no criterion in the evidence or in the verdict or judgment, by which it can be determined how much the jury have assessed as the damages of the several parties. It is undoubtedly true, that should any disputes arise between the covenantees themselves, there might be very great difficulty in determining the proportion of the damages recovered which each should be entitled to receive. But we are unable to see how the defendant is in any way interested in the question of such distribution. Its intezests are fully protected when it is ascertained that the damages recovered are no more in the aggregate than it was liable by its covenant to pay, and that the recovery is a bar to any further prosecution. How the damages are to be distributed is a matter with which it has no possible concern. It is urged that the decision of the Supreme Court in Safford v. Miller, 59 Ill. 205, 215, is not in harmony with the rule above laid down. That was a suit u pon an inj unction bond conditioned for the payment to two obligees of all such damages as they might sustain by reason of the issuing of the injunction. The terms of this condition, as construed by the Supreme Court, limited the undertaking and the liability of the obligors to the damages which the obligees should jointly suffer, and it was accordingly he’d that a judgment based in part upon assignments of breaches alleging damages accruing to the obligees severally could not be sustained. The doctrine of the decision is, not that the obligation was several as to the obligees, so as to authorize suits by each obligee to recover his individual damages, but that such damages were not within the condition of the bond. We perceive nothing either in the decision or the reasoning of the court in any degree conflicting with the conclusions we have reached in this case. Questions of some difficulty are raised upon the evidence adduced by the plaintiffs to establish Reno & Little’s damages, and the rulings of the court in relation thereto. The evidence tends to show that one Abner Reeves, who died in 1875, was, at the time of his death, the owner of the ten lots embraced in the contract in question in this suit, and twelve other lots adjoining the same on the west. At that time the north half of said twenty-two lots was leased to the Chicago & Alton Railroad Company at a rental of §125 per month, or §1,500 per year. The south half was also rented to the Eureka Coal Company at a rental of §75 per month, or §900 per year. The Chicago & Alton Railroad Company, or its assignee, having surrendered possession of said north half, Reno & Little went into possession of it and paid rent therefor to the heirs of Abner Reeves at the same rate reserved in the lease to said company, and continued to occupy the same and pay rent therefor at that rate until some time in the year 1876, Mrs. Reno and Mrs. Little were two of the heirs of Abner Reeves, and some time during the year 1876 they bought out the other heirs, and thus became the exclusive owners of said lots. After their purchase, Reno & Little remained in possession of the north half as tenants of their wives, and paid them rent therefor at the rate of §100 per month down to the date of the contract with the defendant. After the. death of said Beeves, one Clark became the tenant of the south half of the lots, and continued to occupy the same until the spring of 1881. At the expiration of Clark’s lease, Beño & Little took possession of what remained of the south half, after the sale of the ten lots to the defendant, thus including in their coal yard the twelve lots still owned by their wives, and continued to occupy the same, paying rent to their wives at the rate of §100 per month up to some time in August following, when the switch connections were interrupted. After the switch tracks were removed, they continued to occupy said lots down to June, 1885, when said Little died, but the evidence shows that nó rent was paid by them after August, 1881. It does not appear that they held possession of said lots under any written lease, or that there was any express agreement between them and the owners of the fee fixing any specific term for the tenancy. On the contrary, the evidence shows affirmatively that there was no such lease, and no agreement fixing the duration of said tenancy. Under these circumstances it seems clear that, at the. time the switch connections were removed, Beño & Little were holding the lots occupied by them as a coal yard as tenants from year to year. Mr. Taylor, in his Treatise on Landlord and Tenant says: “ The ordinary mode of leasing is for a specified term of years ; but if no particular time is limited for its duration, a tenancy from year to ■ year will arise.” And again: “ Since the time of the Year Books, the courts have treated a general occupation by permission, no time being fixed for its continuance, as a tenancy from year to year, whenever the reservation of rent, or other circumstance, indicated an agreement for an annual holding. A tenancy of this description is not determinable at the end of any current year, unless a proper notice to quit shall have been previously served by the proper party intending to dissolve the tenancy upon the-other ; in default of which the tenancy will run on from year to year until some event happens which, in contemplation of law, destroys it.” Taylor on Land, and Ten., Secs. 54, 55. See also, Ridgely v. Stillwell, 25 Mo. 570 ; Williams v. Deriar, 31 Mo. 13 ; Swan v. Clark, 80 Ind. 57 ; Lesley v. Randolph, 4 Rawle, 123 ; Thomas v. Wright, 9 Serg. & R. 87; Sullivan v. Enders, 3 Dana, 66 ; Boudette v. Pierce, 50 Vt. 212; Hall v. Wadsworth, 28 Vt. 410; Hunt v. Morton, 18 Ill. 75; 4 Kent’s Com. 112. Reno & Little being tenants of said premises from year to year, had a right to continue in the enjoyment of their tenancy, not merely during the current year but until the tenancy should be terminated at the end of that or some subsequent year by notice duly served on them by their lessors. On the other hand it was within their power to put an end to their tenancy at the expiration of that .or any subsequent year by service of like notice of their lessors. In point of fact the tenancy was not terminated by either party prior to the death of Little, in June, 1885. The plaintiffs gave evidence showing the damages to Reno & Little’s business consequent upon the breach of said covenant by the defendant, from the date of the final interruption of the switch connections down to the date of Little’s death. It is insisted that they are entitled to recover only such damages as accrued during the then current year, and that in fulfillment of the duty which the law imposes upon a party .injured 'from another’s breach of contract or tort, to make reasonable exertions to render the injury as light as possible, it was their duty to terminate their tenancy at the expiration of said year. Undoubtedly the legal duty above referred to is reasonable and just. As said by Selden, J., in Hamilton v. McPearson, 28 N. Y. 67, “ The law, for wise reasons, imposes upon a party subjected to injury from a breach of contract, the active duty of making reasonable exertions to render the injury as light as possible. Public interest and sound morality accord with the law in demanding this; and if the injured party, through negligence or willfulness, allows the damages to be unnecessarily enhanced, the increased loss justly falls upon him.” See 1 Sutherland on Damages, 148, and authorities cited. As illustrations of the rule, we may refer to persons who are hired for service for a given term, and who are wrongfully discharged. The law imposes upon them the duty to seek other employment, and to the extent that they obtain it, or might do so, their damages, will be reduced. A party claiming damages as a purchaser can recover no more than it would cost him, with reasonable diligence, to supply himself with the same property, by resort to the market or some other source or means of supply. Where a party, whose crops are exposed to injury through the default of another in not building or repairing a fence or in tortiously opening the same, is aware of the fact and the cause, and by a little timely labor and expense can avoid the damage, the law imposes upon him the duty of staying the injury, which was thus avoidable, when he is in a favorable situation to do it, and enforces the duty by confining his redress for the injury which was thus avoidable, to compensation for the necessary and proper means of prevention. The rule, however, has never been carried to the extent of requiring the injured party to surrender important and valu- ■ able rights, or to take measures which are likely to involve himself in great and irreparable injury, for the purpose of diminishing the liability of the wrong-doer. The law has no such solicitude for the interests of wrong doers as to require innocent parties to submit to any such sacrifice. The result of the various authorities, where the rule is applied, seems to be that it is only where the party entitled to the benefit of a contract can protect himself from loss arising from its breach at an expense which is comparatively trifling, or with reasonable exertion on his part, that he is bound to take measures to prevent the injury and thus lessen the liability of the other contracting party. In this case the termination by JEteno & Little of their tenancy would, as we may well presume from the evidence, have involved them in loss greatly exceeding that to which they were exposed by the severance of the switch connections between their coal yard and the defendant’s railway. It would have involved the' surrender of a valuable leasehold estate, an estate which was none the less valuable and convenient to them from the fact that their lessors were their own wives who had perfected their title to said lots for the express purpose of furnishing a place for their husbands to carry on their coal business. It would have involved the serious interruption and perhaps the total destruction of a valuable and lucrative business in which they had long been engaged, and in which their labor and capital were invested. It would be carrying the rule to a wholly unwarrantable extent, to require them to submit to sacrifices of this character for the purpose of relieving the defendant from the consequences of a breach of its covenant. We are of the opinion that, under the evidence, the plaintiffs were entitled to recover the damages to Reno & Little’s business resulting from said breach, at least up to the date of Little’s death. There was, therefore, no error in the admission of evidence of such damages. Some complaint is made of the nature and scope of the evidence introduced for the purpose of establishing such damages, but we think that said evidence is subject to no valid objection, especially when taken in connection with the instructions of the court in which the true measure of damages was laid down, and which the jury must be presumed to have followed. The court admitted in evidence, against the objection and exception of the defendant, the record in the suit in chancery brought by said covenantees to compel a specific performance of said covenant, and its admission is assigned for error. Said record consists of the bill, answer and replication, and a decree awarding a specific performance of the covenant in accordance with the prayer of the bill; and said record also shows that said decree was afterward affirmed by this court, but that on appeal to the Supreme Court it was reversed and the cause remanded with directions to. dismiss the bill for want of equity, and that in obedience to that mandate said bill was dismissed by the court below at the costs of the complainants. It appears that the counsel for the plaintiffs, in offering said record in evidence, stated to the court that he offered it simply to show that during the pendency of those proceedings the covenantees were trying to have said covenant executed, and that they were acting in good faith in remaining in possession of said premises up to the time the decree was finally reversed by the Supreme Court. It appears sufficiently from what has already been said, that the facts which this record was offered to prove were wholly immaterial. The covenantees had a clear legal right to remain in possession and enjoyment of said premises during the entire period for which the plaintiffs sought to recover daimages. Their good faith in so doing was not open to question, and their conduct in that behalf was in need of no apology. The record then was immaterial for the purpose for which it was offered, and was in our opinion incompetent as general evidence in the case. After the reversal the decree was to be held for naught, and had no more force and effect, either as a finding of the facts or the law, than if it had never been entered. The bill consisted of mere dec'arations of the complainants, and upon no principle of law could such declarations be received as evidence generally in their favor. But while we are disposed to hold that the admission of the record in evidence was . error, we are unable to see that the defendant was in any way miterially prejudiced thereby. There was no substantial conflict in the evidence, and the plaintiffs’ case was fully made out, both as to the right of recovery and the damages, by the other evidence. The statements of the bill seem in no material respect to add to or conflict with the case made by the other evidence, except in one particular. The bill alleges that, at the time the switch tracks were finally removed, Beño & Little were in possession of their coal yard under a lease from their wives, dated April 30,1881, for a term of one year from May 1, 1881, to May 1, 1882, at a rental of $3,000 for the year. In so far as the bill stated facts which were proved by the other evidence, its admission in evidence could have done no harm to the defendant. In the particular above mentioned, in which it averred a lease terminating May 1, 1882, it was an admission in favor of the defendant. Under such lease Beño & Little’s tenancy, as well as their right to damages, would have extended no farther than May 1, 1882, and the defendant sought to take advantage of such admission by an instruction which was given to the jury at their instance, that if such lease was proved the plaintiffs could not recover any damages alleged or claimed to have accrued to Reno & Little after that date. After such full and careful examination of the case as its magnitude and importance have demanded at our hands, we are of the opinion that there is no material error in the record. The judgment will, therefore, be affirmed. Judgment affirmed.