Boston & M. R. R. v. N. R. R.

• Decision Date: 01 May 1928
• Citation: 142 A. 118
• Parties: BOSTON & M. R. R. v. NORTHERN R. R. et al.
• Court: New Hampshire Supreme Court

142 A. 118

BOSTON & M. R. R.

v. NORTHERN R. R. et al.

Supreme Court of New Hampshire. Grafton.

May 1, 1928.

Transferred from Superior Court, Grafton County; Sawyer, Judge.

Bill in equity by the Boston & Maine Railroad against the Northern Railroad and another transferred from the superior court. Case discharged.

Bill in equity, alleging that the plaintiff, as assignee from the Boston & Lowell Railroad, is the tenant of the Northern Railroad under a lease for 99 years given by the Northern to the Lowell; that, by the terms of the lease, additions and improvements made with the written consent of the lessor are to be accounted for by it at the termination of the lease; that such betterments have been made; and that the defendants refuse to give written consent thereto. The prayer of the bill is for orders compelling consent, and for other relief.

The defendants answered, substantially admitting the facts material here, but denying the plaintiff's claim as to the meaning of the lease.

In the superior court, Sawyer, C. J., transferred the question of the construction of the lease in advance of a trial.

Jewett & Jewett and Stephen S. Jewett, all of Laconia, for plaintiff.

Benjamin W. Couch, of Concord, Winthrop Wadleigh, of Milford, and Robert W. Upton, of Concord, for defendants.

PEASLEE, C. J. This proceeding is brought against the Northern Railroad and its officers and directors. But as the conclusion reached concerns the railroad only, it is spoken of herein as the defendant.

The clause in the lease, under which the present controversy arises, reads as follows:

"* * * At the expiration or earlier termination of the lease, it will return said demised road and property, with all equipment thereof, to the party of the first part, in as good order and condition as the same now are, without diminution or depreciation in any respect; provided, however, that in case any additions or improvements to said railroad or property shall have been made by the party of the second part, at that time, with the written consent of the party of the first part, the same shall be paid for by the party of the first part, at the value thereof, at the time this lease shall expire or be terminated."

The plaintiff alleges the making of additions and improvements, a demand for consent thereto, and a refusal of compliance by the defendant. The issue thus presented is whether the defendant is under a legal duty to consent. The question of duty to pay will not arise until the termination of the lease. Unless the plaintiff shows a present right to demand consent, it is not entitled to any relief at this time. Consequently, the alleged duty to pay when the lease is terminated has not been considered, except in so far as the question is involved in reaching a conclusion upon the issue as to consent.

This written contract is to be construed according to the recognized rules governing the interpretation of writings. "The intention to be ascertained is that expressed by the parties by the language they used. What did they mean by the words employed? Or, to follow Wigmore's suggestion, what is the 'sense' of the language? 4 Wig. Ev. s. 2459; Kendall v. Green, 67 N. H. 557, 558 ; Stratton v. Stratton, 68 N. H. 582, 585 . In the language of Judge Ladd, 'the question * * * is not what the parties intended to do, but what did they do? What intention did they express in the deed?' Pillsbury v. Elliott, 56 N. H. 422, 425; Gill v. Ferrin, 71 N. H. 421 ." Lancaster, etc., Electric Light Co. v. Jones, 75 N. H. 172, 174, 71 A. 871, 872.

The agreement is plain upon its face. It provides for the return of the property according to the usual duty of a lessee. Recognizing the general rule that nonremovable additions and improvements become the property of the lessor without duty to make compensation (Rand v. Dodge, 17 N. H. 343; Guay v. Kehoe, 70 N. H. 151, 46 A. 688), provision is made for compensating the lessee therefor, under certain conditions. Unless these conditions have been fulfilled the lessor will have no duty to pay.

The conditions stated are free from any ambiguity. The additions or improvements must have been made "with the written consent" of the lessor. The lease provides no other test. It contains nothing suggestive of a duty so to consent. The provision is plain and straightforward. It can be read in but one way.

There is nothing peculiar or unusual in such a provision. It is constantly used in insurance contracts, and its validity has been treated as unquestionable. Sargent v. Fire Ins. Co., 82 N. H. 489, 136 A. 124; Gale v. Ins. Co., 41 N. H. 170; Dube v. Fire Ins. Co., 64 N. H. 527, 15 A. 141, 1 L. R, A. 57; Blanchard V. Fire Ins. Co., 33 N. H. 9. A like situation has prevailed as to leases. Boston, C. & M. R. Co. v. Boston, etc., R. Co., 65 N. H. 393, 23 A. 529. This leading case, decided the year before the present lease was made, must have been well known to the attorneys for the parties to this controversy. "This is a valid stipulation, inserted for the benefit of the lessors." Emery v. Hill, 67 N. H. 330, 332, 39 A. 266. 267.

In answer to these propositions, the plaintiff says that the parties must have contemplated betterments of the property by the lessee, which were to be paid for by the lessor, and that it is the "lessor's duty to give consent to all reasonable betterments. No provision of the lease has been referred to as imposing the alleged duty. It is sought to be inferred from the general situation disclosed by the lease, and the alleged equitable character of the plaintiff's contentions.

The position taken is that all reasonable additions and improvements must be assented to and accounted for. It is evident that, if the plaintiff is to prevail at all, it must be to this extent. If something other than the will of the lessor determines the right of the parties, the substitute must be something capable of legal ascertainment and remedial application. If a judicial order for consent is to be made, it must specify the boundaries of the action ordered.

A stipulation that the lessor or its agents Should pass judgment on whether it should account for certain betterments would be making the defendant a judge in its own cause. "As it has always been held that no man can be a judge in his own cause, such agreements have never been considered to be binding." Smith v. Railroad, 36 N. H. 458, 490. "It can hardly be said that, such power of deciding one's own cause can be conferred at all." Janvrin v. Exeter, 48 N. H. 83, 86, 2 Am. Rep. 185. The plaintiff must establish a duty to give consent. A provision for the exercise of judgment in the matter would not be sufficient.

The proposition advanced is that there is a duty to account with the plaintiff from time to time, and that the defendant has no right to withhold consent. It is manifest that any such interpretation would be a wide departure from the explicit provision in the lease. It not only adds terms not found in the writing; it also runs counter to the thought expressed.

The conditional form of this clause is weighty evidence of the intent of the parties. It envisages a situation where no additions or...