Braddock v. Hinchman

78 N.J. Eq. 270 | N.J. | 1911

Lead Opinion

The opinion of the court was delivered by

Swayze, J.

We are unable to sustain the order in this case upon the theory that the complainant is entitled to specific performance of the contract as set forth in the bill, or upon the ground of an equitable lien, upon which it was sustained by the vice-chancellor. We think, however, that the bill charges facts which justify the order. The agreement is in the nature of a cropping agreement. In Guest v. Opdyke, 31 N. J. Law (2 Vr.) 552, we held that where land was worked on shares under a mere agreement to have a portion of the crop, the parties were tenants in common of the crop> and the relation was not that of landlord and tenant. Subsequently, under agreements worded somewhat differently, we held that the relationship was that of lessor and lessee. New Jersey Midland Railway Co. v. Van Syckle, 37 N. J. Law (8 Vr.) 496 (at p. 507); Reeves v. Hannan, 65 N. J. Law (36 Vr.) 249. The distinction between those cases and the earlier case rested upon the language of the agreement, which must always be of importance. The present case differs from Guest v. Opdyke in that it involves not an annual crop but the crops of a series of years, derived not mqrely from the annual cultivation of the soil and sowing.of seed, but from a more or less permanent plantation of cranberry bushes. If we were to follow the rule of Guest v. Opdyke, we should have a case where the parties were tenants in common of successive crops, some of them to be hereafter grown, the right to which would become fixed in equity when the crop came into existence. Smithurst v. Edmunds, 14 N. J. Eq. (1 McCart.) 408; McFarland v. Stanton Manufacturing Co., 53 N. J. Eq. (8 Dick.) 649. The rule has been applied to crops to be raised in a subsequent year. Cumberland National Bank v. Baker, 57 N. J. Eq. (12 Dick.) 231. The agreement must be read in the light of - these decisions, the effect of which was to give Braddock a potential interest enforceable in equity. It cannot be said that the agreement is sufficient to create a partnership between Braddoek and Hinehman, since it is evident that neither of them intended to constitute the other the general agent for the management of the business, and neither intended to assume the liability for obligations incurred by the other. There is nothing to indicate an agreement to form a copartnership. Wild v. Davenport, 48 N. J. Law (19 Vr.) 129. The agreement does, however, evince an intent to enter upon a joint adventure to which Hinchman should contribute the land, with the cranberry bushes unproductive as they were, and Braddoek should contribute his labor and sin'll and knowledge of the business, and each should share in the expense and the profits. That there may be such a joint adventure, even though the elements of a partnership are absent, appears from our own decisions. Ross v. Stevens, 45 N. J. Eq. (18 Stew.) 231, was a case of a joint venture of the plaintiff and defendant in the purchase and sale of lands, whereby each was entitled to one-half of the profits, and Vice-Chancellor Van Fleet sustained a bill for an accounting, and his decree was affirmed by this court. In Warwick v. Stockton, 55 N. J. Eq. (10 Dick.) 61, Vice-Chancellor Pitney held that the agreement was one of joint adventure and not of partnership; he refused to appoint a receiver pendente lite, but held that the complainant was clearly entitled to have an account taken in the court of chancery. Conover v. Tansey, 73 N. J. Eq. (3 Buch.) 562, was a case somewhat resembling the present, and Vice-Chancellor Howell did not question that parties who had entered into a joint adventure were subject to at least some of the rales which regulated partnerships, but he held that under the facts of that ease he would not appoint a receiver. Subsequently, in Jackson v. Hooper, 76 N. J. Eq. (6 Buch.) 185, he dealt again with the subject of a joint adventure, and collected the earlier cases and granted relief to the complainant upon that theory. His decree was reversed, but upon a ground that applied offiy to the facts of that particular case. Vice-Chancellor Garrison has dealt with the subject in Simmons v. Lima Oil Co., 71 N. J. Eq. (1 Buch.) 174. It is sufficient to cite of the cases in other jurisdictions, Marston v. Gould, 69 N. Y. 220; Petrie v. Tarrent, 49 N. W. Rep. 1076; Bradley v. Wolff, 83 N. Y. Supp. 13. We entertain no doubt of the general principle that where parties engage in a joint adventure to share profits and losses, equity may entertain jurisdiction very much upon the principles applicable to partnerships.

The difficulty in this case arises out of the fact that Hinchman has died and can no longer perform his part of the contract. If the case were a partnership it would be the duty of Braddock, as surviving partner, to wind up its affairs, and this ordinarily ought to be done at once or with reasonable speed. We have, however, held in Wild v. Davenport, 48 N. J. Law (19 Vr.) 129 (at p. 137), that “a stipulation in partnership articles that upon the death of a partner his capital shall remain in the business until the expiration of the prescribed term of the partnership is binding as well upon the estate of the deceased as upon the surviving partner.” By analogy, where capital is embarked in a joint adventure for a prescribed term, and the parties have clearly evinced an intent that it should remain in the business until the expiration of the term, it is not to be withdrawn merely because one of the joint adventurers has died. The present agreement by its express terms was to last for twelve years. If there were nothing more in the agreement it might well be contended that it was subject to.the implied condition that both of the joint adventurers should survive in order that the agreement might be carried out according to its terms, but there is language in this agreement which clearly indicates that Hinchman intended that the property should remain subject to the control of Braddock in accordance with the agreement after Hinchman’s death. No other meaning can be attributed to the provision that the buildings are to be kept in good repair and insured at the expense of Braddock and Hinchman or his executors. By imposing this liability upon his executors, Hinchman clearly showed that he contemplated that the agreement might last longer than his own lifetime.

The remaining question is 'whether this agreement can be enforced against the present appellant. This follows almost as a matter of course our conclusion that the property was to be continued in the joint adventure after Hinchman’s death. ■ His heirs and devisees held the land in trust for the purposes of the agreement, and the appellant, having acquired his title with notice of the agreement, is subject to the like trust.

We think, therefore, that the objection of the appellant that the case is not a proper case for the jurisdiction of equity fails, and that the jurisdiction may be sustained either upon the theory of an equitable title or upon the theory of a joint adventure, or upon the theory of a trust, or upon all three. In any event, the alleged lack of equity is not so clear that a demurrer to the bill should prevail.

The order is therefore affirmed, with costs.

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Concurrence Opinion

Garrison, J.

(concurring).

I think that the order of the court of chancery should be sustained upon the ground upon which such order was put by the court below, viz., that of "equitable lien.”

The agreement set forth in the bill is of the sort of which Mr. Pomeroy says:

“In a large class of executory contracts, express or implied, which the law regards as creating no property right, nor interest analogous to property, but only a mere personal right or obligation, equity recognizes, in addition to the personal obligation, a peculiar right over the thing concerning which the contract deals, which it calls a ‘lien’ and which, though not property, is analogous to property, and by means of which the plaintiff is enabled to follow the identical thing, and to enforce the defendant’s obligation by a remedy which operates directly on that thing. The theory of equitable liens has its ultimate foundation, therefore, in contracts, express or implied, which either deal with or in some manner relate to specific property such as a tract of land * * * and the like. It is necessary to divest one’s self of the purely legal notion concerning the effect of such contracts, and to recognize the fact that equity regards them as creating a charge upon or hypothecation of the specific thing, by means of which the personal obligation arising from the agreement may be more effectually enforced than by a mere pecuniary recovery at law.” 8 Pom. Eq. Jur. § 1234.

From the illustrations given in the text and the cases cited in the notes, the pertinent doctrine to be deduced may be stated in this form: An executory agreement in writing, whereby a party so'contracts that land of his, therein particularized, is clearly appropriated to the performance of the obligation of its owner created by such contract, gives to the party, with whom he has so contracted, an equitable lien upon the land itself upon which equity may administer a remedy where a mere pecuniary recovery would be inept or inadequate.

This rule applies where, by the owner’s contract, the use of his land is essential to a joint undertaking in which by such contract he has engaged, and to which he has therein agreed that the use of his land shall be devoted. Whether or not in such case, more especially in that of an alienee of the land with notice, the remedy will be limited to the injunctive power of the court need not be now decided; upon demurrer for lack of equity in the bill it is enough that the facts therein set forth exhibit a case of equitable cognizance. The fundamental thing to be borne in mind is that the right to this equitable remedy, which springs solely from the act of the owner of the land, arises whenever he has for his own benefit so dealt with it, or its use, as to create an equitable right in the one with whom he has dealt to have the land applied to the object to which the owner by his contract has devoted it. In fine, equity simply deals with the land in order to require its owner to make his contract just what he himself declared it to be. If, as in the present case, the land has been alienated, the law of notice preserves such remedy as against the alienee, as was pointed out by Chief-Justice Beasley in Brewer v. Marshall, 19 N. J. Eq. (4 C. E. Gr.) 537: “There is a class of cases,” he says, “in which equity will charge the conscience of an alienee of land with an agreement relating to such land, where clearly the agreement neither creates an easement nor runs with the title. This rule has been too frequently acted upon and is too deeply seated in our legal system to be passed by unnoticed or to be rejected as unsound. I regard it as a part of the law.”

Upon the ground of equitable cognizance stated, supplemented by this rule of the law of notice, the bill in the present case is good upon demurrer. I therefore vote to affirm the order of the court of chancery.

For affirmance — The Chibe-Justice, Garrison, Swayze, Reed, Trenchard, Parker, Bergen, Minturn, Bogert, Vre-DENBURGH, VROOM, C'ONGDON, SULLIVAN — 13. For reversal — Voori-iees—1.