Anheuser-Busch Brewing Ass'n v. Dwyer

Mr. Justice Freeman delivered the opinion of the court. It is sought to set aside the injunction order entered in this case upon the ground, first, that it restrains the breach of a contract, is a negative specific enforcement of the contract and should therefore be governed by the same doctrine and rules which control in cases of specific performance. On the other hand, appellee’s counsel urge that the bill at bar was filed not with a view of compelling a direct specific performance of" the affirmative covenants of the lease and contract by way of injunction, but by means of that remedy to enforce and prevent a violation of the express negative covenants of those instruments. The injunction order complained of restrains appellants from permitting “any domestic beer other than that manufactured by the Anheuser-Busch Brewing Association” to be used upon the premises in question, and “from directly or indirectly buying, taking or selling on said premises any draught beer whatsoever manufactured or sold by any other brewing company than the complainant.” This is not in our opinion a mere indirect attempt to enforce the specific performance of the affirmative covenants of the lease and contract. Appellants are not compelled under this injunction to ‘ ‘ carry on and conduct a saloon business on the premises described in said chattel mortgage,” nor to “purchase of said Anheuser-Busch Brewing Association for sale and use upon said premises beer manufactured by said Association.” They are not required to specifically perform any of these agreements; they are by the. language of the injunction merely restrained from selling or using any other beer save appellee’s on the said premises. It is conceded by appellants’ counsel that Illinois cases hold “that equity will enjoin the breach of negative covenants in contracts and deeds and in such proceedings is not governed by the ordinary rules in cases for specific performance.” The injunction in this case does not forbid appellants closing their saloon on these premises and going elsewhere if they see fit, nor forbid their ceasing to use or sell domestic beer on the premises. Neither does it require appellants to buy any draught or domestic beer from appellee. It merely forbids them from buying such beer for use or sale on the premises from any one else than appellee until the further order of the court. In Carlson v. Koerner, 226 Ill. 15, 19, cited by appellants’ counsel, it is said: “It is no doubt the rule that in respect to purely negative covenants annexed to or contained in contracts or leases, courts of equity frequently interfere by injunction and indirectly enforce specific performance of such negative covenants by prohibiting their breach; and it is equally well settled that where there is such an express negative covenant, courts of equity will entertain jurisdiction by injunction, although the same will occasion no substantial injury, or even though the injury, if any, be recoverable at law. This is upon the principle that the owner of land selling or leasing it may insert in his deed or contract just such conditions or covenants as he may see fit touching the use or enjoyment of the land, and in case of the breach thereof he is not to be defeated by the opinions of any number of persons that he is not substantially injured thereby.” See also Star Brewery Co. v. Primas, 163 Ill. 652, 658, where it is said that “the owner of land selling or leasing it may insist upon just such covenants as he pleases touching the use and mode of enjoyment of the land,” and the breach of such negative covenant may be enjoined. In the case at bar the lease and the contract each contains a condition or covenant “touching the use or enjoyment of the leased premises, which in effect is that the premises shall not be employed for the use or sale of any draught beer whatsoever manufactured or sold by any other brewery than that of the appellee. This restriction by the terms of the lease is made binding upon and to apply and inure to the “respective successors and assigns” of the parties to the lease. We deem it unnecessary, in view of previous decisions, to discuss at length the question as to whether an injunction will lie to prevent violation of express negative covenants or agreements of a lease or contract. The question was presented in Garden City Sand Co. v. The Southern Fire Brick Company, 124 Ill. App. 599, 607, and the judgment of the Appellate Court was affirmed by the Supreme court in a comprehensive opinion. Southern Fire Brick Co. v. Sand Company, 223 Ill. 616, 624. It is said by appellants’ counsel that in the case at bar the negative agreement set out in the lease does not purport to restrict the use to which the premises shall be put and cannot be brought under the head of a covenant restricting the use of the demised premises. In Carlson v. Koerner, 226 Ill. 15, 19, it is held in substance that where there is an express negative covenant annexed to or contained in contracts or leases, courts of equity will entertain jurisdiction by injunction, although the same will occasion no substantial injury or even though the injury, if any, be recoverable at law. But in order to give courts of equity jurisdiction on that ground the covenant must be a negative one and must be certain and the use of the premises for a specific purpose must be clearly fixed by the agreement of the parties. “If the negative covenant is only implied from a positive stipulation, courts are not so ready to lend their jurisdiction.” It is evident we think that by the restrictive clauses in the lease, as well as the more explicit phraseology of the contract, it is “expressly covenanted and agreed” that the lessee “shall buy all draught beer to be used or sold” on the demised premises from appellee and ‘ ‘ shall not directly or indirectly buy, take or sell any draught beer whatsoever manufactured or sold by any other brewery,” and that such covenant and agreement come within “the principle that the owner of land selling or leasing it may insert in his deed or contract just such conditions or covenants as he may see fit touching the use or enjoyment of the land. ’ ’ Carlson v. Koerner, supra, pp. 19, 20. Whether in actual terms or express restriction upon the use of the premises, the language used in the lease does, we think, in substance restrict the lessee to “the use of the demised premises in a particular manner or for a specified purpose”; and in such case “a violation of the covenant by the use of the premises in a different manner or for another purpose forms ground for the interposition of equity by injunction, and in all such cases a court of equity is. regarded as the appropriate forum for administering relief.” High on Injunctions (4th ed.), vol. 1, sec. 436. See also Pomeroy’s Equitable Remedies, vol. 1, sec. 285. Restrictive covenants in deeds and leases relating to the use of demised premises are enforced, as is conceded by appellants’ counsel, “without regard to questions of irreparable injury, the financial responsibility of the parties or mutuality of remedy or obligation.” The contention is that the negative agreement in question “does not purport to restrict the use to which the premises demised shall be put.” Whether, or not, as above stated, we regard it as an express restriction in exact terms upon the use of the premises, it is clear that such is its purport and that it was intended to restrict the lessee from the use and sale of any beer on the demised premises other than that made and sold by appellee. It is subject to no other construction. And such restrictive covenants in leases “will be specifically enforced in equity by means of injunction not only between the immediate parties, but also against subsequent purchasers with notice, even when the covenants are not of a kind which technically run with the land.” Pomeroy’s Equity Jurisprudence, vol. 4, sec. 1342 (3rd ed.). It is urged that appellee has a plain, adequate and complete remedy at law. In addition to what is above said upon this point, the objection has been considered by the Appellate Court in Stafford v. Swift, 121 Ill. App. 508, 510, where it was said: “It is argued that appellee has a complete remedy at law in an action for damages since it does not appear that such a judgment could not be collected. But the exercise of the preventive jurisdiction of courts of* equity in eases of violation of negative or restrictive covenants annexed to leases is sustained by abundant authority, and is based £in part upon the necessity of preventing a constantly recurring grievance resulting from the continuous breach of the covenant which cannot be adequately compensated by an action for damages. ’ (High on Injunctions, 3rd ed., Sec. 436). In Consolidated Coal Co. v. Schmisseur, 135 Ill. 371, 378, it is said that courts will interpose by injunction and indirectly enforce specific performance of negative covenants in contracts or leases even though their breach may occasion no substantial injury or though damages, if any, may be recoverable at law. See, also, United States Trust Co. v. O’Brien, 18 N. Y. Supp. 798-800, where it is said that such a covenant as that here in question could be more effectually enforced at the time with perfect and complete justice in equity, than afterward by the uncertain character of proof available in an action at law for compensatory damages.” Whatever view may have been taken in some other jurisdictions, we are of opinion that the law as above stated is sustained by sound reasoning as well as by the greater weight of authority. It is further urged that ££a contract calling for a succession of acts, whose performance cannot be consummated by one transaction and which requires protracted supervision will not be specifically enforced in equity.” Inasmuch as the injunction under consideration merely restrains appellants from violating, not implied, but express negative covenants of the contract and lease in controversy, no question of specific performance is now involved. It may be said, however, that it is certainly equitable to dispose of the questions presented by this bill in one proceeding if the alternative would be a multiplicity of suits at law during the five years yet remaining before the expiration of the term of the lease and contract. It appears, moreover, that appellee is not by the terms of the lease made a party thereto, and it is said could not maintain an action thereon at law for a breach of the covenants in its favor. The bill shows that appellee sought permission of the alleged nominal lessor, Hannah & Hogg, to bring suit in the name of the latter corporation for the alleged breach of the covenants of the lease and such permission was refused. We think it immaterial that, as argued by appellants, the effect of the injunction is to specifically perform the contract, that appellants must either go out of business or purchase beer of appellee; and the objection that the court must exercise continual supervision over the subject-matter is we think rather fanciful than real, but in any event furnishes no ground for disturbing the injunction complained of. The cause has been elaborately presented by counsel, but inasmuch as the views stated seem to us controlling, we deem it unnecessary to extend the discussion. For the reasons indicated the injunction order of the Superior Court complained of will be affirmed. Affirmed. Mr. Presiding Justice Holdom dissenting.