70 F. 166 | 7th Cir. | 1895
(after stating the facts as above). The principal questions discussed by counsel are: (1) Whether the evidence shows such a contract for an interest in real estate, followed by part performance upon the part of complainants in the original bill, as to take the case out of the statute of frauds, and entitle the complainants to a specific performance. (2) Is the action for specific performance barred by the judgment in the forcible entry and detain-er suit? (3) Allowing that the complainants are entitled to have the contract for a five-years lease specifically performed, are they now, after the decree is entered as prayed for by them, entitled in equity to a decree for the payment of the value of the improvements put upon the premises by them, as damages in lieu of specific performance? There are some other minor questions presented by the record, but we think the case may be properly disposed of upon a consideration of these.
Upon the first and principal question, we are of opinion that the circuit court properly overruled the report of the master that the case of the complainants was barred by the statute of frauds, and that no case was made for a specific performance. On the contrary, we are of opinion that the evidence brings the case fairly within the leading cases and the great weight of authority on this subject, for specific performance of the agreement. AH' the requisites of süch a case are fairly complied with. The weight'of testimony shows an.
The general rule is laid down by Story, as follows:
“In tlie next place, courts of equity will enforce specific performance of a contract within the statute where the parol agreement has been partly carried into execution. The distinct ground upon which courts of equity interfere in cases of this sort is that otherwise one party would be able to practice a fraud upon the other, and it could never be the intention of the statute to enable any party to commit a fraud with impunity. Indeed, fraud in all cases constitutes an answer to the most solemn acts and conveyances, and the objects of the statute are promoted instead of being obstructed by such a jurisdiction for discovery and relief.”
The rule is vrell laid down very recently by the United States supreme court in Riggles v. Erney, 154 U. S. 244, 14 Sup. Ct. 1083, as follows:
“Indeed, the rule is too well settled to require further citation of authorities that, if the parol agreement be clearly and satisfactorily proven, and the plaintiff, relying upon such agreement and the promise of the defendant to perform his part, has done acts in part performance of such agreement to the knowledge of the defendant, — acts which have so altered the relations •of the parties as to prevent their restoration to their former condition, — it
*176 wóuld be a virtual fraud to allow tbe defendant to interpose tbe statute as a defense, and thus to secure to bimself tbe benefit of wbat bas been done in part performance. It must appear, however, that tbe acts done by tbe plaintiff were done in pursuance of tbe contract, and for tbe purpose of carrying it into execution, and with tbe consent or knowledge of tbe other party. While acts done prior to tbe contract or preparatory thereto, such as delivering abstracts of title, measuring land, drawing up deeds, etc., are not regarded as sufficient part performance, it is otherwise with such acts as taking open possession of tbe land sold, or making permanent or valuable improvements thereon, or doing other acts in relation to tbe land manifestly inconsistent with any' other theory than that of carrying out tbe parol undertaking.”
The same doctrine had previously been laid down in Railway Co. v. McAlpine, 129 U. S. 305, 9 Sup. Ct. 286.
The same rule has been often declared by the supreme court of Illinois, where the premises are situated, as may be seen- from the following adjudged cases: Bright v. Bright, 41 Ill. 97; Kurtz v. Hibner, 55 Ill. 514; McDowell v. Lucas, 97 Ill. 489; Langston v. Bates, 84 Ill. 524; Bohanan v. Bohanan, 96 Ill. 591; Smith v. Yocum, 110 Ill. 142; Irwin v. Dyke, 114 Ill. 302, 1 N. E. 913; Morrison v. Herrick, 130 Ill. 631, 22 N. E. 537.
The principle is well stated by Lord Cottingham in Mundy v. Jolliffe, 5 Mylne & C. 167-177, as follows:
“Courts of equity exercise their jurisdiction in decreeing specific performance of'verbal agreements when there has been part performance, for the purpose of preventing the great injustice which would arise from permitting the party to escape from the engagements he has entered into upon the ground of the statute of frauds, after the other party to the contract has, upon the faith of such engagement, expended his money, or otherwise acted in execution of the agreement. Under such circumstances, the court will struggle to prevent such injustice from being effected; and with that object, it has on the hearing, where the plaintiff has failed to establish the- precise claims of the agreement, endeavored to collect, if it can, what the terms of it really were.”
Tbe supposition that a party would enter into possession of a vacant lot, and expend so large a sum of money in making permanent improvements, under a letting from month to month, is not to be indulged in, unless the proofs and circumstahces make it necessary; but such improvements should be referred to an agreement for a longer term', if such agreement can be fairly found from the evidence.
This principle is laid down by Woodfall in his work on Landlord and Tenant (1st Am. Ed. 1890, vol. 1, pp. 165-167), as follows:
“The laying out of considerable sums of money by a person who enters under an agreement for a long term is rationally to be referred to such agreement, rather than to the mere tenancy at will, to be implied from such entry. After such expenses have been incurred on the faith of a lease agreed to be granted, it would be fraudulent and inequitable for a landlord to refuse to grant such lease.”
We think this language not inapplicable to the case at the bar.
-2. It is contended by Purcell and Puller that the judgment in the forcible entry and detainer proceedings, and the refusal of the court to open that judgment, constitute a bar to this suit. But this contention cannot be maintained. The difficulty with it is the issues are entirely different. The issues here not only were not, but could
' 3. The contention of the complainants that: they are entitled to a decree for the value of the plant as damages in lieu of specific performance is untenable, and must be denied. They get by the decree what they prayed for, and, we think, all they are entitled to receive under the evidence.
The evidence on the question of damages resulting from user and deterioration is quite conflicting, the witnesses disagreeing very much in their estimates; but we cannot say that the amounts reported by the master and adopted by the court are not fairly sustained by the weight of evidence. But we think that these damages, covering the entire period, should only have been assessed against Purcell and Puller. They should be held responsible in equity from being the actuating cause of the complainants being denied their equitable rights under the contract, and being put out of the possession to which they were equitably entitled thereunder. But we are unable to see how the defendant the People’s Pure Ice Company, being a corporation, can be held for damages accruing before it was organized or went into possession of the plant. It would be
The decree of the circuit court will be affirmed in all things except as to the decree for damages against the People’s Pure Ice Company, and as to those damages it will be reversed, with leave to the complainants, if they so choose, to take a further reference to a master to ascertain the proper proportion of the damages sustained for the time that company was in possession, in which case, upon the return of the master’s report and confirmation thereof, a further decree may be entered against the People’s Pure Ice Company for the damages so assessed.
The foregoing opinion was afterwards modified as appears below:
(November 13, 1895.)
In this case there is a motion by complainants to modify the decree in respect to damages against the People’s Pure Ice Company, and also so as to require a further reference to ascertain damages to the plant accruing since the decree was entered. We think the decree should be modified in the first particular named, and the motion overruled as to the last.
We think the entire damages assessed for use and occupation covering the period from May 11, 1892, when Fuller and Purcell went into possession, up to Slay 23, 1894, the day after the entry of the decree, should only have been assessed against Fuller and Purcell, and not against the People’s Pure Ice Company, which did not go into possession until August 28, 1.892, — 3 months and 17 days after the termination of the forcible entry and detainer action, when Fuller and Purcell took the plant. But, as the basis of ■estimating these damages was the interest upon the assessed valuation of the plant, there is no difficulty in determining from data contained in the record the proportion of these damages properly' chargeable to the People’s Pure Ice Company.
The damages for use and occupation assessed by the master and allowed by the court were determined by reckoning the interest at 5 per cent, upon a valuation of $20,000 from May 11, 1892, to May 23, 1894, a period of 2 years and 12 days, and amounting to' the sum of $2,033.33. The People’s Pure Ice Company was organized on June 28, 1892, for the purpose of running the plant, but did not take an assignment of the lease or go into possession until August 28th, and so should not be chargeable for use during that interval. The interest upon that sum at 5 per cent, from May 11th to August 28th, — 3 months and 17 days, — amounting to $297.22, being deducted from $2,033.33; leaves $1,736.11 as the proper amount with which the People’s Pure Ice Company should be chargeable.
As to the $2,500 decreed against all the defendants on account of damages from deterioration, there is no difficulty in affirming the decree as to the People’s Pure Ice Company as well as the other ■defendants, because those damages, according to the master’s report and all the testimony, arose from the shutting down of the
The decree will be affirmed in all things except as to damages for use and occupation assessed against the People’s Pure Ice Company from May 11 to August 28, 1892, and in respect to these the decree as against the People’s Pure Ice Company should be modified by deducting the sum of $297.22 from the aggregate sum allowed by the decree for damages.
The motion for a further reference to a master to ascertain damages sustained to the plant since the entry of the decree will be overruled. Supposing that might be done in any case (a question we do not determine), the decree in this case gave the complainants the right to the possession. The bond given on appeal was not a supersedeas bond, but only for costs; and, if complainants have not taken possession, it is only because they did not wish to do so.