delivered the opinion of the Court.
When the Circuit Court for Baltimore County ordered the erection of a five-foot wire fence between a shopping center and an adjoining lot improved by a store building which faced the parking area of the center, and released the tenant of the store building from further obligations under its lease, some of the interested parties appealed and others cross-appealed.
On January 7, 1953, the Tulip Realty Company of Maryland, Inc., (Tulip) purchased a part of the Woodmoor Shopping Center, located between Liberty Road and Marston Road with Essex Road on the westerly side and the property of the Atlantic Refining Company (Atlantic) on the easterly side. In the deed from Woodmoor Realty Corporation (Wood-moor), the Tulip property was referred to and designated on the plat attached to the deed as Parcels A, B and C. Parcel A was further designated as “Food P'air Building”; Parcel B as “Food Fair Parking Area”; and Parcel C as “Food Fair Loading [Area].” Parcel D on the plat was reserved as a “turn around” for the loading area [Parcel C]. Parcel E was the only other store area in the shopping center. Parcel F was designated as “Future Store Area,” but this parcel as well as Parcel G were originally reserved as parking areas. Parcel PI was reserved for a pavement and grass strip between Liberty Road and the shopping center. With the exception of the entrances, a barrier was erected along the boundary line between Parcel H and Parcels B and G.
There was a time [March, 1952] when Woodmoor was interested in purchasing a part of the Atlantic lot, but subsequently [July, 1953] changed its plans when it abandoned its intention to acquire the lot as parking space to be substituted for Parcel F. Thereafter [October, 1953], the stockholders of Woodmoor decided to acquire the lot through a new corporation [Sedgemoor] 1 and actually did acquire the southerly part of the Atlantic lot on June 21, 1954. On the same day, Wood-moor entered into an agreement with Atlantic that it would not erect any building or other barrier on or between the Wood-moor parking area and that part of the lot retained by Atlantic.
About a year later, on June 8, 1955, Woodmoor entered into a boundary line agreement with Sedgemoor (then incorporated) by which Woodmoor agreed (1) not to erect any building, wall or fence which would impede or prevent the free flow of pedestrian traffic across the boundary between its property and that of Sedgemoor or obstruct the visibility of such improvements as might thereafter be constructed on the Sedgemoor property; and (2) not to erect additional build
There was testimony that Sedgemoor placed its building in the only location that was feasible from an engineering and economic point of view since the beds of Marston Road and Sedgemoor Road were upgrade from the level of its property. In explaining the purpose of the provisions in the boundary agreement as to nonobstruction and the free flow of pedestrian traffic from one store or shop to another in the shopping center, it was stated that it is “a basic economic precept to have no fence between abutting properties” to the end that one store might pick up business from another’s customers and vice-versa.
There was testimony by a shopping center real estate expert to the effect that the Acme store appeared to be a part of the Woodmoor shopping center and that Acme patrons would likely use the center’s parking facilities because that was the spot most convenient to the Acme entrance and exit. The
There was also testimony by the attorney for Sedgemoor and Woodmoor to the effect that Acme—because it was concerned about the possibility of a fence being erected along the common boundary line—had requested the insertion of an “option to cancel” clause in the lease for its protection, and that, although the request was refused, Acme was advised that a mutual nonobstruction agreement between Woodmoor and Sedgemoor could be had if desired. An agent, testifying on behalf of Acme, denied that it had requested an option to cancel, but stated it had demanded the execution of the boundary line agreement as a condition to, and inducement for and in consideration of its entering into the lease. It was not until such assurances had been given and approved that Acme executed the lease. There was no mention of the agreement in the lease, but both were recorded simultaneously on the land records.
On January 9, 1957, Tulip sued Sedgemoor, Woodmoor and the stockholders, directors and officers of both corporations. By its bill, Tulip sought several kinds of injunctive relief as well as compensatory and punitive damages for violations of the covenants in its deed, claiming that Sedgemoor and Wood-moor were in fact one organization and that the store building on the Sedgemoor lot was an integral part of the shopping center and was intended to be used as and for another food market in competition with the supermarket conducted on Tulip’s property. Food Fair Stores, Inc., Food Fair Stores in Baltimore County, Inc., and Penn Mutual Life Insurance Company, which also had interests in the controversy, were made parties plaintiff at a later stage of the proceeding.
The chancellor concluded that it was unnecessary to rule on the question of whether or not the construction of the store building by Sedgemoor was a violation of Tulip’s rights with respect to freedom from competition. He found, however, that the Sedgemoor building “was constructed with the purpose of utilizing the Woodmoor Shopping Center parking lot and making the Sedgemoor property an integral part of the shopping center in pursuance of a bold scheme to evade rights vested in Tulip.” The initial decree directed the construction of a wall to make it impossible for Sedgemoor and Acme to utilize the Woodmoor parking facilities. Following a supplemental hearing, a modified decree directed the erection of a wire fence along the boundary line between Sedgemoor and Woodmoor and for a distance of twenty feet along the southerly boundary of the shopping center, across an existing driveway leading from the center on to Marston Road. It was further ordered that Acme be released and discharged from all obligations under its lease with Sedgemoor.
On appeal, Sedgemoor and Woodmoor, and three of the directors and officers of the corporations, and the mortgagee and trustees contend (i) that Tulip was not entitled to an injunction against the use of the Sedgemoor building as a food market; (ii) that the chancellor erred when he required the erection of the fence; and (iii) that Acme should not have been released from its obligations under the lease. Acme agrees that Tulip was not entitled to any form of injunctive relief, but contends that if such relief is proper, then it should be released and discharged from all obligations under its lease. In addition to insisting that use of Woodmoor parking facili
(i). Use Of Sedgemoor Building As Food Market.
Although the chancellor concluded that it was unnecessary to rule on this question, the point was presented below and the cross-appeal makes it necessary for us to consider it here. However, even if we assume that the construction of the Sedge-moor building facing the Woodmoor shopping center, as and for a food market, was a scheme on the part of Sedgemoor and its tenant to evade the exclusive right Tulip had to sell food products at retail in the shopping center, it is clear that the plan was not a violation of the restrictive covenant between Woodmoor and Tulip for the reason that the application of the restrictive covenant was expressly limited to that portion of the center designated as Parcel E.
The general rule is that restrictive covenants are strictly construed so as to favor the unrestricted use of property.
Martin v. Weinberg,
For instance, the situation here was not the same as it was in
Slice v. Carozza Prop., Inc.,
For the reasons stated, even if we also assume that the corporate entities should be disregarded, there is no doubt that the limited area [Parcel E], in which the restrictive covenant was operative, effectively precluded Tulip from claiming injunctive relief against the use of the Sedgemoor building as a food market.
(ii). Mandatory Injunction To Erect Fence.
That part of the chancellor’s decree which required the erection of a wire fence along the boundary line between Sedgemoor and Woodmoor and for a distance of twenty feet in a westerly direction along Marston Road was proper. The chancellor, who had an opportunity to judge the credibility of the witnesses, concluded that the words and actions of some of the defendants were in direct and irreconcilable conflict, and found as a fact that Sedgemoor constructed its building with the intention of utilizing the Woodmoor parking areas
The chancellor, realizing that any injunctive relief he might grant would be difficult to enforce, required the Woodmoor and Sedgemoor corporations, and such of the stockholders, directors and officers thereof over whom he had jurisdiction, to erect the fence, which is the chief bone of contention in this controversy. What he did in the exercise of his discretion was clearly not erroneous, so far as Woodmoor was concerned.
Rule 1195 a, which was not effective when the decree in this case was signed on November 13, 1958,
2
defines a mandatory or affirmative injunction as an order requiring or commanding the doing of the action specified. While it is true that a mandatory or affirmative injunction should be issued with caution, and is ordinarily restricted to cases where adequate redress
In
Grosfield v. Johnson,
Sedgemoor, as well as those stockholders, directors and of
The other claims that the granting of injunctive relief was premature and that the relief granted was too severe are without merit. The writ of injunction may be invoked to prevent prospective breaches of covenants. See
Baltimore, Etc., Live Stock Co. v. Union Rendering Co.,
(iii). Release Of Obligations Under Acme Lease.
It was error to release and discharge Acme from its obligations under the lease. In the initial decree Acme had been required, along with other defendants, to participate in the construction of the boundary line wall originally ordered, but
On this cross-appeal, Acme contends that the boundary agreement was executed as a contemporaneous and integral part of the leasing arrangement between it and Sedgemoor and constituted a condition precedent and a substantial inducement for the lease; and that the decree ordering the erection of a fence by the court released it from the lease as a partial failure of consideration. On the other hand, it is contended by Sedge-moor, since it had performed its obligations under the lease, that the impossibility of performance does not excuse Acme; and that when Acme requested and was refused an option to cancel the lease, it “took its chances” that the boundary line agreement between Sedgemoor and Woodmoor was sufficient to preserve its rights under the lease.
Other than the boundary line agreement and the testimony of Acme’s agent, the record is clear that there were no other conditions which might vary the terms of the lease. Certainly the boundary agreement in and of itself was not enough to show a breach of the leasing agreement. In fact, about all the boundary agreement does show is that Acme considered as important the free flow of pedestrian traffic across the boundary line. There was no proof that the obstruction of the boundary line by the erection of a wall or fence would be an extreme hardship capable of substantially or totally destroying the value of the leased premises. Nor was there any proof that the risk of a fence being erected on the boundary line was not foreseeable. Indeed; since there was an abundance of evidence that Acme actually knew of the existence of the covenants between Woodmoor and Tulip with respect to the parking area and was well aware of the location of the store it had
The English courts have held that the doctrine of frustration has no application to ordinary leases of buildings since the common law contemplates that a lease of realty is equivalent to a conveyance of an interest in land.
Matthey v.
Curling, [1922] 2 A. C. 180 (H. L.);
Whitehall Court v. Ettlinger,
[1920] 1 K. B. 680 (1918). Even so, the doctrine of frustration has been held applicable to leases in this country. Willis-ton,
Contracts,
§ 1955 (Rev. ed. 1938);
119 Fifth Avenue v. Taiyo Trading Co.,
Generally, however, with respect to leases, the doctrine of frustration has been limited to cases of extreme hardship. In any event the lessee must prove that the risk of the frustrating event was not reasonably foreseeable and that the value of the leased premises was substantially or totally destroyed.
Lloyd v. Murphy,
In the recent case of
Montauk Corp. v. Seeds,
The decision of the chancellor to ignore the question as to the use of the Sedgemoor building as a food market was not improper. That part of the decretal order which required the erection of a wire fence was proper and will be affirmed, but only Woodmoor should have been required or commanded to perform the action specified and Sedgemoor and the stockholders should have been forbidden to interfere with the action required of Woodmoor. However, that part of the decree which released and discharged Acme from its obligations under the lease was improper and will be reversed.
Since that part of the decree pertaining to the erection of the fence must be amended so that the order granting the mandatory and prohibitory injunctions herein required may be given effect, we will remand the case for the passage of a decree not inconsistent with this opinion. The form and scope
Case remanded for the passage of a decree not inconsistent with this opinion; three-fourths of the costs to be paid by Wood-moor Realty Corporation, Sedgemoor Realty Corporation and Abraham Goodman, Paul Goodman and Milis B. Myers, and one-fourth by American Stores Company.
Notes
. The original stockholders of Woodmoor were Abraham Goodman and Paul Goodman, who were father and son respectively. In February of 1954 the father transferred one-half of his stock to Dorothy Nattans and the son transferred one-half of his stock to Ellis B. Meyers. Sedgemoor, which was incorporated in May of 1954, had the same stockholders as Woodmoor and substantially the same directors and officers.
. The rule did not become effective until January 1, 1959.
. See, for instance,
Northern C. Ry. Co. v. Canton Co.,