Richmond v. Dubuque & Sioux City R. R.

33 Iowa 422 | Iowa | 1871

Lead Opinion

Beck, Ch. J.

3. Injunction in ordinary aotions: equitution :iurisdi0~ The points arising upon the defendants’ appeal will be first considered. The first position of counsel on that side of the case is this : The issues _ . ....... .. and questions involved m the proceedings . , , „ . . .B, originated by and growing out ot plaintiffs supplemental and original petitions ashing equitable relief, are not cognizable in the courts of equity. This point, it is claimed by counsel, is one of controlling importance in this ease, and upon it rests the very question of defendants’ liability, in this form of action and in this forum, upon the contract out of which this litigation grows.

The proceedings in this case, subsequent to the institution of the action at law to recover for the breach of the contract, wore commenced under, and based upon, chapter 155 of the Revision. The first two of the three sections of the chapter are in the following words :

“ § 3798. In all cases of breach, of contract, or other injury, where the party injured is entitled to maintain, and has brought an action by ordinary proceedings, he may, in the same cause, pray and have a writ of injunction against the repetition or continuance of such breach of contract or other injury, or the committal of any breach of contract or injury of like kind, arising out of the same contract, or relating to the same property or right, and he may, also, in the same action, include a claim for damages or other redress.”

“ § 3799. In such action judgment may be given for other relief, and also that the writ of injunction do or do not issue, as justice may require; and, in case of disobedience, such writ of injunction may be enforced by attachment by the court, or, when such court shall not be sitting, by a judge thereof.'”

The object and effect of these sections are to confer upon the courts of law, in proper cases, power to prohibit the repetition of breaches of contracts, or other injuries which are the foundations of actions pending therein. It cannot be claimed that they confer general or special chancery jurisdiction. They simply provide a new remedy before exclusively exercised by equity courts, namely, the prohibition of certain acts which are the foundation of legal actions. Neither do these provisions extend the power of the law courts to adopt other remedies than those therein expressly mentioned. The sum of the power conferred is to prohibit the continuance or repetition of the injuries contemplated therein. This is exercised in a law action upon proper petition filed in the cause. It does not abridge the power before possessed by the same courts, to award the ordinary remedies of an action at law. The last clause of section 3798, which permits a plaintiff, in such a proceeding, to claim “ damages or other redress,” and the provision of the following section, which permits judgment to be given for “ other relief,” refer to remedies before fully within the power of the courts of law. If this were not so, and the reference is to equitable relief and remédies, the provisions would overthrow all distinctions between chancery and law, and would authorize, in all law actions, when the injuries, for which' recovery is claimed, may be repeated, the exercise of chancery powers. Considering this statute, as it really is, simply a provision conferring power upon the courts of law, in certain eases? to prohibit the continuance or repetition of certain acts, we will find no difficulty in arriving at the conclusion that it does not authorize the proceedings and judgment in the case before us. The petition filed by plaintiff, praying for relief by injunction, was sufficient to give jurisdiction to the district court to exercise the power conferred by the statute. But it conferred no other jurisdiction. Now, as we have seen, the statute does not confer either general or special chancery power, it does not clothe the law courts with power to grant any other remedy, or any other relief not before possessed, except that of an injunction. If the court, in the case where this relief is sought, refuses to grant it, there is certainly no power conferred by the statute to grant other relief “not within the scope of the powers of the law courts. In the ease before us the court refused to grant the prohibition prayed for, but retained jurisdiction of the case as a chancery court, and proceeded to award other equitable relief. We are clearly of the opinion that no warrant for this course is found in the statute.

2. eqottabxe specific per-contracts.' II. We return to consider the question, whether the action, as presented by the whole record, is cognizable in a court of equity, under the rules of chancery, independent ot. statutory provisions. I he supplemental petition, which we will regard as presenting plaintiffs’ case, as their bill in equity, in the way of relief, claims damages resulting from the violation of the contract, and, in addition thereto, the further and alternative relief that defendants either be required, by proper decree, specifically to perform the contract, or that during the continuance of the contract they be required to report to the court the amount of grain transported by them, which may be subject to the contract, and upon such reports, their correctness having been determined by issues formed thereon, judgment from time to time be rendered. A prayer for general relief is also added. The court refused the relief sought, namely, to compel, by an injunction, a specific performance of the contract. The judgment awards damages accruing to plaintiffs on account of the violations of the contract, and provides for the recovery by plaintiffs of future damages. This brings before us for determination the following questions:

1. Is the plaintiff entitled to the relief requiring defendants to perform specifically the. contract ?

2. If not, does the fact that the suit is instituted to obtain that relief give the court jurisdiction to render a decree for damages. Before entering upon this inquiry it may be remarked that if plaintiffs are entitled to no other relief than the recovery of the damages which they have sustained on account of the breach of the contract, they should seek redress in the courts of law, unless there be other matters connected with the case, as that suggested by the last inquiry, which would give equity jurisdiction. If it be simply a case for the recovery of damages, which may be enforced in the law courts, equity will .not take cognizance thereof. It will be seen that plaintiffs’ right to maintain this action, independent of statutory provisions, depends upon the solution of the questions just stated.

III. In our opinion, the contract between the parties, under the principles prevailing in chancery,, cannot be enforced by a court of that jurisdiction, by compelling a specific performance, by either party violating it. It will be well, right here, at the threshhold of the discussion of this question, to state succinctly the obligations of the contract bearing upon each party. They are as follows: 1. The defendants lease certain land to the plaintiffs, and assure the possession thereof to them for fifteen years. The term is to be continued, at the option of defendants, for fifteen years longer, at the expiration of the term fixed in the lease. 2. The plaintiffs are bound to erect and maintain, upon the land thus leased, an elevator of sufficient capacity to handle all grain that shall be received by defendants not otherwise consigned; the dimensions of the elevator to be increased as the business may require. 3. The defendants agree not to erect a similar building, nor lease any of these lands for' that purpose, during the existence of the contract. 4.- The defendants are bound to pay a fixed compensation per bushel, for handling and storing the grain delivered to the elevator, and they undertake that plaintiffs shall have the handling of all “ through graintransported by them. 5. The defendants agree, in case the lease, at their option, is; not continued at the expiration of the term of fifteen years, to pay plaintiffs the appraised value of the buildings and machinery, and thus become the owners thereof.

Here is a contract having six years to run absolutely, and twenty-one years conditionally, at the option of the defendants. It was executed in August, 1860, and the supplemental petition, upon which equitable relief is asked, was filed in July, 1869. It imposes upon plaintiffs the duty of erecting and maintaining valuable buildings and machinery, of making certain additions thereto, if required, and of rendering services, in connection therewith, demanding a degree of skill. The plaintiffs, to discharge their obligations, must, all the time, possess pecuniary ability, and competency in the way of knowledge of the business, both of which must be applied to the subject of the contract with faithfulness. On the other hand, defendants are bound to deliver all “ through grain ” transported upon their road, to do all their business of that kind with plaintiffs, for the time the contract shall remain in force. They are to sustain plaintiffs in the possession of the land leased, and pay the compensation fixed in the contract for the services rendered.

It is impossible to state a general rule, drawn either from principle or precedents, as to the power of equity to enforce a specific performance of contracts, respecting personal property, choses in action, and personal services. It is often said that in such cases equity will not entertain jurisdiction. But this doctrine is subject to an exception, or is rather limited in its application to cases where compensation in damages does not furnish a complete and satisfactory remedy. The rule is stated in other words, namely: When the contracting party is entitled to the subject-matter of the contract and cannot be fully compensated therefor, equity will afford relief. And it is often expressed in another form as follows: Equity will not interfere when the injured party has an adequate remedy at law. Now, in the application of the rule, as it is variously announced, the important inquiry always is, what constitutes a complete and adequate remedy, and when will this be afforded by the allowance of damages ? It is sometimes said that equity will not interfere, because the law will award damages, and in other cases, that equity will interfere in cases where the law will give damages, on the ground that the party is not fully compensated thereby. The fact that a court of law will award damages, in a given case, does not deprive equity of jurisdiction. To deprive the party of an equitable remedy, the damages, recoverable at law, must be a full compensation and constitute adequate relief. Equity determines this question. We must apply its doctrines in order to pronounce the relief adequate or inadequate.

But here we find no fixed rule to guide us, other than this one, which is general in its language and application; the remedy sought must be indispensable to justice. But natural justice is not meant for, upon its principles, it would, indeed, appear that all men should be required to specifically perform their contracts. The conclusion is reached, that the rules are so general in their nature, that but little aid is derived therefrom in determining whether the relief afforded by the law, in a given case, will be deemed by equity adequate. Each case is determined upon its own facts and the application of equitable principles.

In our opinion the law, in the ease before us, will render adequate relief by awarding damages which will fully compensate the plaintiffs for the injury they may sustain in the future, resulting from defendants’ failure to perform the contract. Plaintiffs’ injury is the loss of profits resulting from the acts of defendants in withholding the grain transported upon the railroad. The profits constitute the object of the contract upon, plaintiffs’ part. If they are awarded the precise amount of money which will equal their profits, they are fully compensated for the injury sustained. Now the law will award this compensation in damages. It will not do to say that, on the account of the difficulty in estimating or establishing such damages, they may not in fact be awarded. The presumption is that exact justice will be done by the judgment of the law.

Plaintiffs can assign no reason for demanding the performance of the contract, other than their right to the grain accruing to them under its provisions. In this respect it differs from the cases cited by their counsel, which we will briefly notice. In Niagara Falls Bridge Co. v. The Great Western Railway Co., 39 Barb. 213, the defendants were bound by covenant to adopt regulations necessary to prevent evasions of plaintiffs’ right to collect tolls from all, except railroad passengers. It was held that defendants should be required to perform specifically the contract, on the ground that, until defendants adopted the' required regulations, it would be impracticable to ascertain plaintiffs’ damage. In Webber v. Gap, 39 N. H. 182, defendants were restrained from interfering with a right of way to plaintiff’s mill. Taylor v. The Society for Establishing Useful Manufacturers, 1 Beasly’s Ch. 264, was a case of interference with water leased by plaintiff. Belknap v. Belknap, 2 Johns. Ch. 463, is a case where certain commissioners, acting under a law of the State, were about to drain a pond which would result in destruction to plaintiff’s mills. Winnipissroga Lake Co. v. Worcester, 9 Fost. 442, is another case of like character, where the party, restrained by equity, threatened to remove a dam in a stream from which complainants’ mills were supplied with water. As in the other cases just referred to, the court held that an injunction would be allowed to restrain a nuisance where irreparable mischief will be done if the injunction be not granted. In Hood v. The N. E. Railway Co., L. R., 8 Eq. Cases, 665, and 5 Ch. App. 524, the defendant, the railway company, had received certain land on condition that it should be used as a first-class station. It was required by the decree in the case, to stop certain trains at the station, and thereby to perform the contract as interpreted by the court. In Stover v. Great Western Railway Co., Y. & C. 180; 6 Jurist. 1009, the defendant was compelled to perform a contract to build an archway under its road, sufficient to permit carriages to pass. Other cases of like character, which need not be more particularly referred to, the foregoing being sufficient to indicate the principles of all, are cited in the argument of plaintiffs’ counsel. In most of these cases the injuries are in the nature of nuisances, and may well be held incapable of compensation by damages. The stopping of railroad trains, and the building of an arch for a carriage-way under the track of a railway, both secured by contract, we readily understand could not be compensated for by any judgment rendered in an action for damages. Considerations of convenience and pleasure may have entered into the rights of thb plaintiffs in each case. The interference with the natural flow of water, and with rights of way, and other easements, has always been prohibited by chancery in proper cases. And the reason for the exercise of jurisdiction in such cases may usually be based upon the inadequacy of- the relief afforded for such injuries by the courts of law.

It is not denied that cases are to be found, where contracts, in some respects resembling the one in this ease, have been specifically enforced. But wherever this has been done upon the ground that the law afforded no adequate remedy to the injured party, it will be found that something else than money, some convenience, pleasure, collateral or contingent rights, or the like, entered into the contemplation of the parties to the contract, and to some extent constituted the consideration therefor. In such cases the injured party would", by the performance of the contract, get something more than a certain amount of money, as the consideration on his part. The cases put by Lord Habdwiok fairly illustrate the point here made. See Buxton v. Lester and Cooper, 3 Atk. 383. The illustrations are these: A ship carpenter contracts for timber for the reason, known to the other party, of its convenience. In this case the legal damage for non-delivery of the timber would not' compensate him, for he would be put to expense and inconvenience in supplying its place. So in the same case if the seller had made'the contract, on the ground known to the other party, of his desire to clear his land, or because of a contract which he had'made so to do, the profits he would have realized would not be a just and adequate compensation for the injury.

In the case before us the handling of the grain is the duty and service to be performed by plaintiffs. Their compensation is fixed by the contract. Outside of this compensation they can receive no benefit. The money paid them as damages will be just as beneficial as the same sum would be, if received as profits, for tbe actual services done under tbe contract.

An argument of plaintiffs’ counsel on this question maybe appropriately noticed right here. It is claimed that tbis is a case of equitable jurisdiction, because tbe damages for a non-performance cannot be accurately estimated at law, but 'must be reached by conjectures of tbe jury. There are cases in which jurisdiction of tbe court of chancery is based upon tbis ground. Adderly v. Dixon, 1 Sim. & Stuart, 607, 1 Eng. Ch. 608. We are not prepared to bold that it will not support tbe jurisdiction to show that damages, on account of required discovery to be made in tbe action, may be ascertained in chancery, when no evidence thereof could be bad at law. If it be shown that tbe practice of tbe law courts, and tbe rules of evidence prevailing there, are such that tbe party can obtain no relief, we think, for that reason, be may go into chancery. But tbis state of things does not exist in tbis case. It is claimed that, under tbe authority of a court of chancery, tbe defendants may be required to report, from time to time, tbe amount of grain, subject to tbe contract, transported over tbe road. Evidence of tbis character, it is insisted, cannot be obtained at law, and without it tbe fact cannot be established. But, in our opinion, substantially tbe same course indicated, with tbe same result, may be pursued at law in order to establish tbe quantity of grain passing over defendants’ road. Tbe “ through grain” transported by defendants, it is claimed, is within tbe knowledge of their officers. Such knowledge is, doubtless, based upon tbe books, records and papers in their possession. Upon tbe plaintiffs, in a law action, by proper, petition, disclosing that fact, and what they expect to prove by tbe introduction of such documents in evidence, tbe defendants will be required to produce them, or, on default thereof, tbe facts set out in the petition, as to tbe desired evidence, will be taken as admitted against tbe defendants. Rev., §§ 4024, 4028. Tbe result reached by this course is substantially tbe same as that arrived at by tbe order of tbe court requiring reports to tbe referee, by tbe defendants, of tbe quantity, of grain, which, under tbe contract, ought to be delivered at plaintiff’s elevator. In each instance tbe court is advised, from tbe same source of knowledge, tbe books of defendants, of the amount of “ through grain.” When this data is obtained tbe amount of plaintiffs’ damage may be as well ascertained at law as in chancery, and will no more depend upon conjecture in tbe one court than in tbe other.

IY. We have announced tbe conclusion that, in our opinion, plaintiffs may recover full and just compensation for tbe injury sustained in añ action at law. This consid-eration, of itself, is sufficient to defeat their right to claim relief in equity. But there are other obstacles in tbe way of enforcing a specific performance of tbe contract. Tbe defendants would be compelled, if tbe contract should be so enforced, to pursue a course of business subjecting them to delays, inconvenience and loss, when considered in comparison with tbe new and improved method they have adopted. Not only would tbe defendants be affected prejudicially, but tbe public would suffer in tbe same way. IJuqnestionably, the method of transportation, without change of cars, results in great benefits to dealers in grain who send it over defendants’ road, as well as to tbe defendants themselves. Now, if defendants are required, by a decree of this court, to go back to tbe old manner of doing business — to throw aside tbe beneficial improvements they have made ■ — ■ tbe business of tbe country would sustain a great injury. For this reason equity will not award to plaintiffs, as relief, a specific performance of tbe contract. By tbe refusal of this- relief, however, plaintiffs are denied no substantial right, for, as we have seen, they may be fully compensated in an action at law. The view just expressed does not defeat plaintiffs of their right to recover damages. It is in effect this: Defendants are at liberty to adopt a new method of transporting grain which is beneficial to themselves and the public, but they are held liable to plaintiffs for profits under the contract. This is not inequitable toward plaintiffs, for they are fully compensated for the loss of the profits in the damages they recover. Johnson et al. v. The Shrewsbury & Birmingham Railway Co., 17 Jur. 1015.

3-._mutuai covenants. Y. The nature of the contract and the character of the mutual covenants present an inseparable objection to a remedy requiring specific performance. Plaintiffs’ covenants, as we have seen, impose upon them an obligation to maintain, for a long period of years, buildings and machinery of considerable value; during this time they are bound to render services — to do work for defendants requiring the outlay of money, the exercise of skill, care and watchfulness, and demanding, on the part of those employed, integrity and faithfulness. These covenants are personal in their nature; they require the exercise of personal qualifications and qualities.

Equity will not require defendants to perform their covenants unless plaintiffs, by a like proceeding, may be compelled to perform theirs; nor will it interfere, if it appear defendants are not secure in their rights and remedies for violation thereof by plaintiffs. Bromley v. Jefferies et al., 2 Vern. 415; Moore's adm'r, v. Fitz Randolph, 6 Leigh. 175; Lawrenson v. Butler, Schoales & Lefroy, 13; Stokes v. Wedderburn, 3 Kay & Johns. 393 ; Hills v. Crolls, 2 Philips, 60, 22 Eng. Chan. 59; Baldwin v. The Society for diffusion of Useful Knowledge, 9 Sim. 393, 16 Eng. Chan. 394; Bozon v Farlow, 1 Mer. 459; Coslake v. Till, 1 Russ. 376; Johnson et al. v. The Shrewsbury & Birmingham Railway Co., 17 Jur. 1015.

Defendants could not have, against plaintiffs, a decree for specific performance. The character of the services contemplated by tbe covenants, tbe great length of time through which the contract runs, and the perishable nature of the property which plaintiffs are required to maintain, all present insurmountable obstacles to such relief. . How may equity require the personal qualities of skill demanded by the contract to be exercised? What assurance can equity give, by its decree, that plaintiffs will always be possessed of sufficient capital to carry on the business or supply the improvements and buildings required by increase in the business? What guaranty can be given that plaintiffs will always be solvent ? And what course would be pursued if plaintiffs fail, from want of skill or want of money, to perform these covenants? These inquiries suggest difficulties in the way of specific relief. The force of these suggestions is increased by the consideration of the fact that, at the option of defendants, the contract may remain in force for about twenty-two years from the date of the commencement of this suit, and eighteen years from this time. Marble Co. v. Ripley, 10 Wall. 339; Bozon v. Farlow, 1 Mer. 459, supra; Coslake v. Tell, 1 Russ. 376, supra; Blockett v. Bates, 1 L. R. (Ch. App.), 116; The Port Clinton R. R. Co. v. The Cleveland & Toledo R. R. Co., 13 Ohio St. 544; Stoker v. Wedderburn, 3 Kay & Johns. 393, supra; Hills v. Crolls, supra; Baldwin v. Society, etc., 9 Sim. 333, supra.

4_muitipiioity of suits. YI. It is said that equity will take jurisdiction of this case in order to avoid a multiplicity of suits between the parties. This is sometimes a ground for the exercise of chancery powers, but it is not of such controlling nature as to require the jurisdiction to be assumed even though other equitable principles are disregarded. The rule relied on is usually applied in cases where chancery has jurisdiction, for a proper purpose, of a subject-matter out of which grow other questions requiring adjudication. In such cases the parties will not be turned over to the law which has cognizance of the matter, but it will be retained, that all rights relating thereto may be settled.. 1 Story’s Eq., §§ 64-61. We do not understand the mere fact that there exists divers causes of action, which may be the foundation of as many different suits between the parties thereto, is a ground upon which equity may be called upon to assume jurisdiction and settle all such matters in one suit. The case would not be different if some of the causes of action were not mature. We have never heard it claimed that equity will entertain an action upon a contract requiring the payment of money daily, monthly or yearly. Tet in such a case an action would accrue at each of such periods, and there would thus be, prospectively, a great multiplicity of actions. In the case before us, admitting the contract to be divisible, and that an action may be maintained upon every breach, this is no ground for interference by a court of chancery. If the contract be divisible, and the plaintiff has a right af action thereon, to recover money, accruing every day, equity cannot take that right from him and substitute a remedy which will award.him damages in gross for the whole amount which he may ultimately recover. The case of a bond, or other contract, upon which money is due at intervals, will serve to illustrate the principle. To avoid the multiplicity of suits which may accrue upon the instrument, chancery will grant relief to the holder, by directing payment at once, not, by decree, require payment at the times fixed by the instrument, and in default thereof award execution.

The decree in this case does not, it appears to us, accomplish the object of terminating many actions in one decree. It provides for monthly litigation before the referee, and judgments to be rendered at every.term of the court. It simply provides the manner of determining the liability of the defendant, which must be pursued in future proceedings.

YII. Having reached the conclusion that this is not a case where equitable relief máy be given, another question is presented, namely: Did the district court, sitting as a court of chancery, after refusing to require the specific performance of the contract, possess the authority to award damages for the breach of its covenants ? In other words, upon- determining that equity did not demand the specific performance of the contract, did it properly exercise jurisdiction in rendering judgment for damages ? In our opinion it did not. Had it acquired jurisdiction in the case for any purpose, as for discovery, it could have retained the case and granted proper relief in the way of compensation. But, when jurisdiction is wanting for any purpose, we know of no reason which would authorize the administration of a purely law remedy. See upon this point 2 Story’s Eq., §§ 796, 797.

5. practice: ^proceeding; •waiver. VIII. This case assumes the aspect of a law action prosecuted in chancery and a judgment for damages recovered, being the same relief which would have been given at law. The further order of the court; appointing a referee, requiring reports to be made of the amount of “ through grain ” transported by defendants, etc., etc., is in the nature of equitable relief. May the judgment and order be sustained %

The following statutory provisions must be considered : Rev., § 2613. An error in the character of a proceeding does not cause the abatement of the action. Section 2615. The error may be corrected by the defendant if the action has been commenced by equitable' proceedings when it should have been at law, upon motion made at the time of filing his answer. The case will be transferred to the law docket. Section 2619. If the motion is not made as required in the last section, the error, as to the kind of proceedings adopted, is waived. Considering these provisions, in connection with others, it will be seen that, under our system of procedure, substantial rights and remedies are regarded without’ reference to the form of action in which they are enforced. Section 2608 abolishes all forms of action, and provides that all private rights shall be pi-otected and enforced and private wrongs redressed, by one form of proceeding, to be known as a civil action. Under section 2872, all technical forms of actions and pleadings are dispensed with, and the rules of the Revision supersede those before applicable to such subject. Under these provisions a judgment in an equitable proceeding will be sustained, if objection has not been made under section 2615, though the action should have been prosecuted by ordinary proceedings, i. e., at law. This is unquestionably so, if the judgment be such an one as the nature of the case demands, had it been prosecuted at law. See Van Orman v. Spofford, Clark & Co., 16 Iowa, 186 ; Conyngham v. Smith et al., id. 471; Taylor v. Adair & Goff, 22 id. 279 ; Parshall v. Moody, 24 id. 314; Van Orman v. Merrill, 27 id. 476.

It is equally plain upon the merits of the case, the. relief granted by the judgment would have been denied at law, and ought not to have been given in an equitable proceeding, that the judgment will not be sustained upon a review of the proceeding in this court. And it will not be disputed that if the relief granted in such a case, as in the case at bar, consists of distinct orders or judgments, a part of which may be sustained under the foregoing view, and a part cannot be, this court, upon appeal, will uphold the first and reverse the last.

9._ right to jury tnai. An argument advanced by defendants’ counsel against this view of the case, or rather in support of defendants’ right to have the cause tried as a law action, may pe appr0priately noticed here. It is this: The right of a jury trial upon the issues in the case is secured to defendants by the law, of which they are deprived if the action is prosecuted by equitable proceedings. That defendants possess the right claimed must be admitted. But they must pursue the course pointed out by the law in order to secure that right. By failing to object, at the time required by the statute, to the prosecution qf the suit by equitable proceedings, they are held to have waived their right to a jury trial. The argument demands no further attention. The case of Byers v. Rodabaugh, 17 Iowa, 53, is a case involving the right of a trial of an equitable issue in a case on the ordinary docket, which is quite different from the trial of a law issue in an equitable action. See and construe Rev., §§ 2615 and 2617. The language of the opinion in that case must be, therefore, limited to the precise question involved in it. See White v. Hampton, 10 Iowa, 238; McDaniel v. Marygold, 2 id. 500.

Mr. Justice Miller is unable to assent to the conclusion we have announced on this point.

IX. "We are now brought to the consideration of the merits of- the action, and to inquire whether plaintiffs are entitled to the relief awarded by the judgment and order of the court.

10. estoppel : contract. The objections urged against plaintiffs’ right to recover upon the contract will be considered in the OTder they are presented in the argument of defendants’ counsel.

It is first claimed that the covenant in the contract, between the Dubuque Elevator and the Dubuque & Sioux City Railroad Co., is personal, and does not run with the land leased thereby so as to bind the assignors. It is, upon this position, argued that plaintiffs could not have been compelled to handle the “ through grain,” and therefore defendants are not -bound by the contract because of such want of mutuality. The ready answer to this objection is, that plaintiffs and defendants have mutually recognized the contract as binding upon them, by performing its conditions as well as by temporary modifications of its terms, asked for by one party and granted by the other. These acts, if the contract by force of its terms would not subsist between tbe parties to this suit, are sufficient to estop both plaintiffs and defendants from now setting up its want of obligation upon either. By these acts it becomes the contract of the parties to this suit.

11. in contract : oonstraotionf' X. It is next urged that the contract operates ■ as an unlawful restraint upon the duties of a common carrier, which plaintiffs are required to discharge, It is claimed, under this branch of the argument, that, by the contract, the defendants are required to deliver the grain to plaintiffs, which is in conflict with their duty to deliver to the consignees thereof. But this is neither the intention nor effect of the contract. The plaintiffs can require defendants to deliver all grain not otherwise consigned, and all “ through grain.” Goods transported by a common carrier are delivered to the consignee at the place of their destination. When grain, under this contract, is carried by defendants to Dubuque, if not otherwise consigned, it is delivered to plaintiffs, who thereupon discharge the duties either of warehouse-men or of the railroad in receiving and holding the grain until delivered to the owner. Whether such duties pertain to the railroad or to warehousemen need not he here considered. The grain from the elevator is delivered to the owners. This is no evasion of or restraint upon the duties of the carrier, for the elevator is simply a means employed for the delivery of the grain. And so, in the case of “through grain,” the elevator is but a means adopted to transport it or aid in its transportation. The contract, therefore, in no manner interferes with the discharge of the duties of a common carrier.

XI. The position is taken by defendants’ counsel that the contract in suit, as to the consideration which plantiffs are to receive, is entire and indivisible, and the term of payment not being provided for in the instrument, it is to be made when all the services covered by it are completed. It is insisted that such is the construction the law places upon the contract.

The question here presented is one of intention of the parties. This intention may be disclosed by the language, by considering the subject-matter of the contract, and the interpretation put upon it by the parties themselv.es. "While conceding that the language of the instrument expresses nothing from which its character in this respect may be determined, we are of the opinion that the question may be solved without difficulty upon the other grounds of interpretation; The services which plaintiffs undertook to perform were to run through a period of fifteen years, which, at the option of defendants, could be extended to thirty years. They consisted in separate and distinct acts, all of precisely the same character, yet distinct, that is, the continuous services of handling grain brought in defendants’ cars. Each car load required distinct services of plaintiffs to pass it through the elevator. The compensation to be paid plaintiffs for handling each ear load can be readily.ascertained under the contract; so it may be ascertained for any given time during which the services are rendered. Now that payment was intended by the parties to be delayed for fifteen years, .or, at the option of defendants, for thirty years, is utterly unreasonable. There is no ground for such a construction based upon the contract itself, and the question only arises from the absence of any expression on the subject. It is but fair to presume that the parties relied upon, as a rule of the contract, that equitable doctrine which is sometimes applied to the construction of contracts, namely, compensation ought to be made to one entitled thereto, as benefits are received from him. But the parties have, by their own acts, put a construction upon the instrument to the effect that payments are to be made monthly. We will readily adopt that construction, confessing that we would gladly pursue even a more dimly marked, and less certain path, to escape a result so repugnant to reason, and in conflict with the plainest principles of justice, as the interpretation contended for by defendants’ counsel.

The following authorities support the views we have just announced: Goodwin v. Merrill, 13 Wis. 659; Badger v. Titcomb, 15 Pick. 109; Sickles et al. v. Pattison, 14 Wend. 257; Mavor, assignee, v. Pyne, 3 Bing. 285; 11 Eng. C. L. 101; Perkins v. Hart, 11 Wheat. 237.

XII. The next position of the counsel of defendants is ingenious, but unsound. It is this: Admitting the covenant of defendants to pay for the services of plaintiff to be divisible, nevertheless, the covenant to deliver the “through grain” to plaintiffs is not divisible, and damages resulting from the breach thereof must be recovered in one action. It is, indeed, difficult to see any thing about this covenant other than characteristics of entire unity. The defendants are bound thereby to employ plaintiffs to do certain services and pay for them — to deliver to them grain to be handled in the elevator, and to pay for the handling. Now, it is the same covenant which binds defendants to deliver the grain that obligates them to pay plaintiff. It is, therefore, not proper to speak of the covenant to pay possessing certain characteristics, and the covenant to deliver the grain as possessing others. There is, in fact, but the one covenant. Under it defendants are bound to do two acts — ? deliver grain and pay money. Now, it is very plain if the covenant, as to one of these acts, be divisible, it must be as to the other. It would be a strange interpretation of the contract indeed, to hold that defendants, for a breach of this covenant in refusing to pay for handling a given amount of grain, may be liable in an action at once, but for its breach, in failing to deliver the same amount of grain, a recovery may be .had, but plaintiffs’ remedy for further like breaches is thereby exhausted. This is the result of the argument under consideration. The covenant in question, as we have before pointed out, requires the performance by defendants of successive acts, whereby the services of plaintiffs are called into requisition, namely, the delivery of grain as it shall be transported over the railroad.' Now, suppose some of these separate acts should be omitted and others performed — one day defendants would refuse to deliver the “ through grain ” carried by them, and the next should do so; it is very plain that plaintiffs would be entitled to compensation in the way of damages for their loss, sustained by such violation of the contract. And it is equally plain, under the doctrines we have heretofore announced, that plaintiffs would not be delayed in this remedy until the termination of the contract, but could maintain an action upon each separate breach of the contracts of this nature.

The contract must be regarded as a whole; the rights and obligations of the parties depend upon and are determined by it as a whole. One of the parties, by a voluntary breach of one or all of its covenants, cannot impose upon the other the necessity of regarding it as wholly abandoned, or treating the breach as a total breach, whereby the innocent parties would be deprived of benefits and advantages that' would otherwise flow to them. They would have the right so to treat it, but the law would not compel them to pursue that course. It will be observed, upon examination of the contract, that defendants are, by its terms, bound to deliver all “ through grain ” transported on their road at plaintiffs’ elevator. It is very plain, from the contract, that plaintiffs are bound to receive not only the “through grain,” but all grain not otherwise consigned, which, for convenience, we will call “local grain.” Conceding that defendants are not bound to deliver “ local grain,” plaintiffs, being bound to receive it, would forfeit the contract by refusing so to do. Now, the evidence clearly establishes that, while defendants refuse to deliver “ through grain,” they continue to deliver, under the contract, “local grain.” In this state of the case defendants, while violating the covenants binding npon themselves, are requiring plaintiffs to perform the obligations resting upon them. The performance of these obligations is beneficial to plaintiffs ; under these circumstances they may elect to continue, on their part, to perform the covenants of the contract, and hold defendants liable for the actual breaches committed by them. If they pursue this course they cannot recover prospective damages, for, as the contract is not regarded as wholly abandoned, the defendants may resume the performance of their obligations under it. The authorities cited by defendants’ counsel are cases where, by a total breach of the contracts respectively, they were regarded as wholly abandoned, and damages were recovered accordingly. Regarding the contract 'as not wholly abandoned, and the acts of defendants as not constituting an entire breach, the former judgment against them does not operate to bar recovery in this case. The breaches of the contract not being considered as entire, the defendants are liable in this action for damage accruing since the first judgment.

Revision, section 4127, is in these words: “ Successive actions may be maintained upon the same contract or transaction whenever, after the former action, a new cause of action has arisen thereupon.” The views above stated are certainly supported by this statutory provision, if, indeed, it does not go further. But its full force need not now be discussed.

The objection to this conclusion, urged by counsel, to the effect that it sanctions a multiplicity of suits, is answered by the consideration of the single fact, that the result is not brought about by the voluntary act of plaintiffs, but is the necessary consequence of defendants’ wrongful acts. They treat the contract, as to plaintiffs’ covenants, as still subsisting, and require their performance, thus making it impossible for plaintiffs to treat the contract as wholly abandoned, and the breach as entire, without abandoning benefits yet to flow from the performance of the contract. Should plaintiffs treat the contract as entirely broken and abandoned by defendants, they must resort to their action for damages- on account of the loss of these benefits, with the probable result of defeat, for we • do not see how they could recover as to the “local grain” when plaintiffs do not refuse to deliver it, or submit to the loss of profits growing out of that branch of the contract. This the law will not require.

XIII. Another position of defendants’ counsel is stated, in their own words, as follows : “ Performance of the contract became impossible, by the Dubuque & Sioux City Railroad Co., the moment the lease of its road and rolling stock was executed and delivered to the Illinois Central Company. By the act of leasing the road the former company deprived itself of the power to give plaintiffs the grain to handle, and necessarily committed a total and absolute breach of the contract by thus rendering performance in the future impossible.” This objection is not based upon facts. The first-named company, in the contract with the other corporation, provides for the performance of the contract, thus, instead of treating it as violated, expressly contracting against its violation. The lease, instead of being an act of abandonment of the contract, is one to secure its performance. It is obvious that this affords no grounds to the defendants, at least, to claim that the contract is broken, wholly or in part.

XIY. The evidence discloses the fact to be, that a great part of the “ through grain ” transported by defendants, since the trial in which the first judgment was rendered, was carried under directions of the shippers, to the effect that it' should not be sent through plaintiffs’ elevator. Counsel now contend that grain carried under such instructions from the shippers was not subject to the contract. It is claimed that the contract requires- defendants to deliver, at plaintiffs’ elevator, only such “ through grain ” as they have a right to control; that, when the shippers direct it to be transported in a different manner, defendants are not bound to deliver it under the contract. But there is no such provision as this in the instrument, which provides, in express terms, that plaintiffs shall have the handling of “ all through gravnP If the shippers really have control of the grain, after it is received by the defendants for transportation, so far as to dictate the manner thereof, it does not excuse defendants for the non-performance of the contract. They undertook that plaintiffs should have the handling of all such grain, and thereby became warrantors against any interference of the shippers which would divert the grain from plaintiffs’ elevator.

There is another reason why tkesé directions of the shippers should not excuse defendants for the violation of the contract. The evidence clearly establishes that such directions were given by the procurement of defendants themselves, with the obvious intent of defeating the plaintiffs in this action, and of excusing future breaches of their agreement. Defendants cannot be permitted to take advantage of the directions of the shippers obtained by such' collusive and unfair interference on their part, even should the law require the grain, after it is delivered to the carrier, to be handled in the manner dictated by the consignor.-

15 — contracts policy* mm-c merce?' °°m" XV. It is argued with great confidence, and at great length, that the contract in this case is in conflict with public policy, and therefore void. The same objection was urged against the contract, on the ground that it operated to create a monopoly, when the case was before in this court. "We held the contract valid. 26 Iowa, 191. The decision then made, as to the questions involved, must be considered final. But the contract is now claimed to be in conflict with the public commercial policy of the country, and therefore void. This objection, is grounded upon certain acts of congress. The first one is tbe act of June 15, 1866, passed under the constitutional authority conferred, upon congress, to regulate commerce among the several. States, authorizing railroads “ to connect with roads of other, Státes, so as to form continuous lines for the transportation ” of “ all passengers, troops, government supplies, mails, freight and other property on their way from one State to another State.”- The other congressional laws are the acts allowing the erection of certain railroad bridges across the Mississippi river, among which is the Dubuque bridge. Under these statutes the respective bridges are required to be free to the trains of all railroads terminating thereat, for reasonable compensation.-

It is claimed that the objects of these acts are to secure to travel and freight going from State to State, through lines of transportation without change of cars. We are prepared-to assent to this statement'-of the object of this congressional legislation. We fail, however, to find in these acts any provisions requiring railroads to connect so as to form such continuous lines, or requiring the cars of one to be hauled over the roads of another. Without expressing any opinion upon the authority of congress so to legislate, it is very plain that these statutes have not that effect. They simply authorize the railroad. corporations so to conduct their business, and thereby exempt such a course from local interference or prohibition, on the part of State or municipal legislation. They do not command connection by railroads; they simply permit it. It cannot be claimed that, under these laws, the Dubuque & Sioux City Railroad and The Illinois Central, without the mutual consent of the respective corporations, would constitute a continuous through line, which could be used, by either company. If no contract existed between these corporations, the public would receive no benefit, in the way of continuous transportation, from these laws. Again, while the law of congress authorizes the erection of the Dubuque bridge, and. declares it shall be used by the trains of all railroads, for a reasonable compensation, it does not com: pel the railroads to use it. If the railroad corporations that are defendants to this suit should, to-day, determine to return to the use of ferry boats or plaintiffs’ elevator, in case no contract with the railroad bridge company is in the way, the acts of congress would not prevent it. They do not, as before remarked, require railroads to be operated as continuous lines — they simply permit it, and protect them when that course is voluntarily adopted. Suppose the elevator, to-day, should offer inducements, at the expense of shippers, and to the advantage of the railroad companies, for the transportation of the “ through grain ” across the river, and the offer should be accepted, what relief would shippers have, or how could they, under these congressional laws, defeat the arrangement? It may at once be seen that the contract involved in this suit is not in conflict with these laws.

That the public commercial policy of the country favors continuous transportation may be conceded. But that policy is enforced by no laws, either of legislative enactments or judicial recognition. Contracts in contravention of a general policy of this character are not invalid. These remarks will be understood as applying to roads in different States, and not to the roads of this State.

XVI. We conclude, upon the foregoing consideration of the merits of the case, that plaintiffs are entitled to recover the lawful damages which they have sustained, on account of the non-performance by defendants of their covenants in the contract. They are-entitled to judgment in this action for whatever sum may be determined upon the evidence to be justly due them. As we have seen, this is a law case prosecuted by equitable proceedings. The relief given to plaintiffs must be such as is demanded by the facts of the case, and authorized by the law applicable thereto. Such relief is just compensation in damages for tlie loss sustained by the defendants’ breach of the contract. The order of the court appointing a referee and requiring reports by defendants of the amount of grain, subject to the contract, transported upon the railroad, cannot be sustained. The plaintiffs are not, under the law applicable to the case, entitled to such relief. It affects the substantial rights of defendants, and must, therefore, be denied.

17.___ measure of damages. XYII. ¥e have noticed all of the points made upon defendants’ appeal, and will now proceed to consider those arising upon the -appeal of plaintiffs, which relate, exclusively, to the amount of the judgment rendered in this ease. The damage allowed is only such as the court found -plaintiffs were entitled to recover on account of loss of profits which would have resulted, had the “ through grain ” been delivered, from the receipt of one cent per bushel for handling it. The amount of the judgment is $57,750. We are of the opinion that this sum is properly allowed for this item of damage. We have carefully considered the evidence, and are satisfied that the conclusion is well supported by the facts disclosed. No damage, however, was allowed for loss of profit resulting from plaintiffs being deprived of the storage of grain. It was refused as being remote, uncertain and speculative. In this we think the court erred.

The storage of grain was a part of the business contemplated by the contract, and was an inducement thereto. It cannot be doubted that the parties to the contract contemplated that plaintiffs would reap profits therefrom. Suppose the contract provided that plaintiffs should be paid for no other services than “for storage, can there be a doubt that recovery in that case could not be had therefor ?

If plaintiffs could not recover they would be remediless, and the contract would afford them no protection. If they in that case could recover, they can in this. The damages are no more remote, uncertain and speculative, under the contract, as it stands, than in the case supposed. Upon tlie proof they do not appear to be objectionable on this ground. They are established with reasonable accuracy, quite as much so as are the damages allowed by the district court. There is not entire certainty as to the amount that ought to be allowed, but this is no reason why none should be given. The law is satisfied with a just and fair approximation to the true amount. In our opinion, the evidence satisfactorily establishes that, for the time covered by the judgment, plaintiffs’ loss, under the provision of the contract relating to storing, is $11,250, and we, therefore, allow that sum.

Mr. Justice Cole is unable to concur upon this point w'ith the majority of the court, and is of the opinion that the damages should be restricted to the loss sustained by plaintiffs, on account of their being deprived of the handling of “ through grain ” at one cent per bushel.

18.-interest. XVIII. Counsel for plaintiffs insist that interest should have been allowed eo nomine, and assessed as _. , . a part of the damage. In support of this position, they cite Mote v. The C. & N. W. R. Co., Iowa, 22. Without doubting the rule announced in that case, we are not prepared to apply it to this. The facts upon which recovery of interest was there allowed are very different from those which are presented in the case at bar. But while we decline to apply the rule of the case cited, and allow interest eo nomine, we are of the opinion that interest may be considered as an element of damage under the rule which permits its allowance in order to arrive at the sum which will be a just and lawful compensation for the injury sustained. It is true that, practically, the result is the same as though interest were allowed eo norm/ne. But all cases of unliquidated damages do not demand the application of the rule. In such cases interest may be withheld which could not be done if the rule required its allowance, eo nomine, in cases of this character. We base pur conclusion here stated upon the following authorities: Survivor of Holmes & Co. v. Misroon, 1 Const. 21; 3 Brev. 209; Suydam et al. v. Jenkins, 3 Sand. 614; Hyde v. Stone, 7 Wend. 354; Beals v. Gurnsey, 8 Johns. 446; Kenedy v. Whitwell et al., 4 Pick. 466.

In view of the peculiar facts of the case, the majority of the court are of the opinion that interest ought not to be allowed in this case. It is believed that the amount of damages allowed by the judgment which we render in this case is a full and adequate compensation for the loss sustained by plaintiffs.

XIX. Plaintiffs’ claim for damages covers loss of profits resulting from the deprivation of the business of shelling corn, sacking grain, etc., which it is insisted they are entitled to recover. The evidence is not sufficiently certain to authorize the allowance of these items of damages'. They have not been allowed for this reason. We express no opinion upon the question as to whether they constitute a valid claim for damages.

19. Regal tender: treasmynotes. XX. Plaintiffs demanded, in the court below, that the judgment should require payment thereof to be made in coin, and renew the claim in this court, relying upon Hepburn v. Griswold; 8 Wall. 603. This court has held,in several cases, that the act of congress of July 16, 1862, making United States treasury notes legal tender in payment of debts contracted both before and after, the enactment of that law, is constitutional. Warnibold v. Schlicting, 16 Iowa, 243 ; Troutman v. Gowimg, id 415; Hentrager v. Bates, 18 id. 174; Mulligan v. Hentrager, id. 171; Wilson v. Triblecock, 23 id. 331.

Under the doctrine that this court has uniformly recognized, plaintiffs’ judgment may be paid in the currency, which is made a legal tender by the laws of congress.

But the doctrine of Hepburn v. Griswold no longer prevails in the United States .'supreme court, having been overruled by the recent legabtender cases, Knox v. Lee and Parker v. Davis, 11 Wall. 682. It must be understood that, with the later ruling of the United States supreme court according with our own, we regard the question as finally and definitely settled.

20. practice : mistake in iorum. XXI. The judgment entered in this court covers all damages accruing up to the 1st day of May, 1870, which was subsequent to the commencement of the n , , suit, or to the nling oí the petition, upon which recovery is had. This would not have been permitted in an action at law, but accords with the practice and rules of the chancery courts. Under these rules the case was tried in the court below as an equitable proceeding. It retains its character in this court, and has been tried here de novo. The defendants, failing at the proper time to object to the form in which the action has been prosecuted, as we have before pointed out, are presumed to have waived objections and assented to the cause proceeding as an equitable action. In this view of the case, the judgment may properly cover damages accruing since the commencement of the suit. Eor the same reason we direct judgment to be entered in this court, instead of remanding the cause to the district court for further proceedings.

Judgment will be entered in this, court in favor of plaintiffs for the sum of $69,000. It will draw interest from February 20, 1871, and will be without prejudice to plaintiffs’ claim for damages after the 1st day of May, 1870. The order of the district court, appointing a receiver and requiring reports from defendants, etc., is reversed, otherwise the case will stand as

Modified and affirmed.

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Dissenting Opinion

Miller, J.,

dissenting from the ruling upon the right of defendants to a jury trial.

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Dissenting Opinion

Cole, J.,

dissenting from the conclusion allowing damage for loss of profits on account of plaintiffs being deprived of the storage of grain.

Case Details

Case Name: Richmond v. Dubuque & Sioux City R. R.

Court Name: Supreme Court of Iowa

Date Published: Feb 24, 1871

Citation: 33 Iowa 422

Court Abbreviation: Iowa