Seven Mile Beach Co. v. Dolley

The opinion of the court was delivered by G-UMMERE, ClIIEE-JuSTICE. The appeal in this ease is from a decree, made upon a cross-bill filed by the defendants, which requires the complainant to specifically perform an agreement, in writing and under seal, for the conveyance of a tract of land at Avalon, on Seven Mile Beach, Cape May county, New Jersey. The purpose of the original bill filed by the complainant was to have this agreement declared to vest in the defendants no right or interest in the lands described therein, and to be absolutely null and void, by reason of failure of performance on their part. The decree appealed from, in addition to the affirmative relief granted on the defendants’ cross-bill, denied the relief sought by the complainant in its original bill. The complainant appeals both from the portion of the decree which refuses' it relief and also from that part thereof which grants relief upon the defendants’ cross-bill. The agreement which is the basis of this litigation was made on the 6th day of May, 1903. By its terms the defendants, who were connected with various educational institutions in the city of Philadelphia, agreed, among other things, to incorporate a society under the name of the American Association for the Advancement' of Education; to conduct a summer school of the association at Avalon, New Jersey, and nowhere else, for a [739] period of three years from and after the date of the agreement; to conduct the school at least four weeks of every summer during the three years, and to erect and pay for, within the three years, “such buildings, lecture halls,” &e., as the association might require for its purposes, no definite amount of building being specified. The complainant agreed that if the “foregoing covenants” of the defendants should be well and faithfully performed, it would, at the expiration of the three years, execute and deliver a good and sufficient deed Lo them for twenty specified lots, located in the borough of Avalon. The concluding clause of the agreement is in the following words: “It being the intention of this agreement that the said parties of the second part [i. e., the defendants] shall conduct a summer school Iona fide, in accordance with the prospectus, a copy of which is hereunto attached, for a period of three years, and should in return receive from the Seven Mile Beach) Company the land hereinbefore mentioned in the manner herein described.” It appears from the proofs that in the summer of 1903 the defendants, having obtained from the borough of Avalon permission to use the public schoolhouse of the borough, and from the complainant permission to use an old sawmill located upon the lands in dispute, opened a school in these buildings, and conducted it there during the summer season; and that during the following summer they also conducted their school in those buildings. The proofs show that no rent was required from them for the use thereof. During the summer of 1905 the defendants conducted their’ school in a cottage, which they rented for the purpose, and also in the old sawmill. It is conceded that neither during the duration of the contract, nor at any subsequent time, did they erect any building in Avalon in compliance with the terms of their contract; and further, that after the summer of 1905 the carrying'on of the school was permanently abandoned. The construction put upon the agreement by the learned vice-chancellor was that tire sole obligation which it imposed upon the defendants as a condition to their right to a conveyance of the land in dispute was to conduct a summer school at Avalon, bona fide, during the period specified in it. His conclusion 'that [740] this was the true construction of the instrument was rested upon the words of its last clause, which he considered to be a summary of its binding provisions. It seems to us, notwithstanding the declaration of intention contained in the'clause referred to, that the construction put upon the agreement by the learned vice-chancellor is too narrow. It is apparent, from a reading of it as a whole, that the purpose sought to be accomplished by the complainant was the establishment of a permanent summer school at Avalon, which would form one of the attractions of the place as a seaside resort. The natural effect of the conduct of the school for three years would be to carry the scheme beyond the experimental stage. The erection during that period, by the defendants, at their own expense, of such buildings as should be required for the purpose of the school, would constitute a permanent investment by them, and tend to insure their continuing the conduct of the school after the expiration of the three-jrear period. Their promise to make this investment was just as binding upon them, and was as much a part of the consideration for the complainant’s promise to convey, as was their agreement to locate the school at Avalon and conduct it there for three years. In reaching this conclusion we do not overlook the suggestion contained in the opinion of the learned vice-chancellor that the words, “but no definite amount of building is specified,” in the covenant of the defendants to build, practically destroys that covenant, for the reason that it would be satisfied by the erection of a building of nominal cost. The suggestion, however, seems to us to be without force. The agreement is to erect such buildings as the association should require for its purposes. Both parties to it saw that the number, size and character of the buildings which would be required by the association would depend largely upon the degree of success which should attend the contemplated scheme. They, therefore, did not attempt to anticipate the future by providing for the erection of a fixed number of buildings of specified size, which might, on the one hand, turn out to be greatly in excess of the needs of the association, and, on the other hand, entirely insufficient for its purposes, but agreed generally that whatever buildings the association should require for its purposes should be [741] erected by tbe defendants, leaving their number, size and character for the future to determine. The portion of the decree appealed from by the complainant should be reversed and a decree entered in conformity to the prayer of the complainant’s bill. For affirmance—None. For reversal—The Chiee-Justice, Garrison, Fort, Hendrickson, Pitney, Swayze, Eebd, Trenchaed, Bogert, Vris-DENBURGH, VROOM, GREEN, GRAY, DlLL-14.