Colonna Dry Dock Co v. Colonna

• Decision Date: 11 June 1908
• Citation: 108 Va. 230,61 S.E. 770
• Parties: COLONNA DRY DOCK CO. v. COLONNA.
• Court: Virginia Supreme Court

108 Va. 230

61 S.E. 770

COLONNA DRY DOCK CO.

v.COLONNA.

Supreme Court of Appeals of Virginia.

June 11, 1908.

1. Appeal and Error — Harmless Error — Errors Not Affecting Result — Refusal of Rehearing—Cumulative Evidence.

The refusal of the circuit court to grant a rehearing for the submission of cumulative evidence, which could not change the result, is not ground for reversal.

[Ed. Note.—For cases in point, see Cent. Dig. vol. 3, Appeal and Error, § 4033.]

2. Specific Performance — Discretion of Court.

An application to the court to compel specific performance is addressed to its sound judicial discretion, regulated by established principles.

[Ed. Note.—For cases in point, see Cent. Dig. vol. 44, Specific Performance, §§ 17-18.]

3. Same—Contracts Enforceable.

Before equity will specifically enforce a contract, the contract must be distinctly proved, clearly and distinctly ascertained, and must be reasonable, certain, legal, and mutual, founded on at least a meritorious consideration, and the party seeking specific performance must not have been backward, but ready, desirous, prompt, and eager.

4. Same.

Where the court is unable from all the circumstances to say whether the minds of the parties met on all the essential particulars of the contract, or, if they did, cannot say on what substantial terms they agreed, specific performance will be refused.

[Ed. Note.—For cases in point, see Cent. Dig. vol. 44, Specific Performance, §§ 86-99.]

5. Same—Evidence.

Evidence held not to establish a contract for the sale of real estate with the degree of certainty required to enable the court to decree its specific performance.

6. Equity—Jurisdiction—Ancillary Jurisdiction—Award of Damages.

Equity cannot undertake to give damages, save ancillary or auxiliary to some one of the recognized subjects of jurisdiction, and then only such damages are awarded as may be necessary to do full justice by way of compensation.

7. Damages—Breach of Agreement to Pay Money—Measure of Recovery.

Damages for breach of an agreement to pay money are capable of exact measurement in contemplation of law, and the measure of damages is as a general rule the principal sum, with legal interest thereon from the time the payment was due.

[Ed. Note.—For cases in point, see Cent. Dig. vol. 15, Damages, § 339.]

8. Same—Liquidated Damages or Penalty.

A purchaser in an option contract for the purchase of real estate agreed to form a company which should unite the vendor's property and the property of a third person in its holdings, agreed to pay the consideration named partly in cash and partly in the stock of the company issued on the basis of its combined holdings, and the balance secured by bond of the company and a first deed of trust on theproperty conveyed by the vendor. The purchaser deposited in a bank a specified sum under an agreement which stipulated that he should have an additional fixed period within which to comply with the contract, and that, if he failed to do so, such sum should be taken by the vendor "as liquidated damages." Held, that since the agreements by the purchaser were independent, and since for a breach of the agreement to make the cash payment there was an exact standard for measuring damages, the specified sum deposited was a penalty, and not liquidated damages.

Appeal and Error from Circuit Court, Norfolk County.

Suit by the Colonna Dry Dock Company against C. J. Colonna to enforce specific performance of a contract, in which Jay C. Howell filed a cross-bill against defendant C. J. Colonna and wife. From a decree granting insufficient relief, complainant appeals, and defendant assigns cross-error. Affirmed.

Riddleberger & Roper and W. L. Williams, for plaintiff.

M. C. Elliott, D. Tucker Brooke, and R. C. Marshall, for defendant.

CARDWELL, J. On the 29th day of December, 1904, Jay C. Howell obtained from C. J. Colonna a written option contract, under seal, whereby Colonna covenanted and agreed that he would, at any time prior to the expiration of 90 days from the date of the contract, convey to Howell, by good and sufficient deed with general warranty, in which the wife of Colonna would unite, three certain tracts of land with improvements thereon, situated in Norfolk county, Va., the conveyance "to be for the price and sum of one hundred and eighty-five ($185,000.00) thousand dollars, payable as follows, to wit: One-fourth of the purchase money to be paid in cash, twenty-five thousand ($25,000.00) dollars in stock of a company to be made up of the property herein named and that of B. A. Colonna, and the balance in twenty years after date with interest from date at the rate of six per centum per annum, payable semiannually, secured by deed of trust on the property, with the right of said Jay C. Howell or the company he may form to purchase the property to anticipate and pay off the bonds at any time before maturity. * * * " A bond for the deferred payment was to be made by Howell or his assigns, secured by a first deed of trust upon the property conveyed by Colonna and wife, and they were to "deliver to him [Colonna] twenty-five thousand dollars of stock to be issued at the par value of one hundred dollars a share on the basis of two hundred and twenty-five thousand dollars, including the B. A. Colonna and C. J. Colonna properties."

Other features of the contract are omitted from the foregoing statement, for the reason that upon those recited this controversy depends.

It was not the purpose of Howell in obtaining the option to purchase and acquire title in himself to said properties of C. J. Colonna, but to interest capitalists and organize a joint-stock company to which the option was to be assigned by him, the purpose of the organization to be the construction and operation of shipbuilding yards, wharves, dry docks, power plants, "and all things necessary to the operation of a general shipbuilding, repairing, and dry dock business."

Accordingly a charter was obtained by the "Colonna Dry Dock Company, Incorporated, " with a maximum amount of capital stock of $200,000 and a minimum of $25,000, with the right to issue preferred and common stock to the amount of the maximum capital stock of the company, and thereupon Howell executed and delivered to the company the following assignment:

"Know all men by these presents that I, Jay C. Howell, for and in consideration of the sum of one dollar and other considerations to me in hand paid, the receipt of which I hereby acknowledge, do hereby assign all my rights, title and interest to the option hereto attached, dated Dec. 29, 1904, and any extensions of the same, and also in the receipt hereto attached, dated the 27th day of November, 1905, to the Colonna Dry Dock Company, Inc., a company operating under the laws of the state of Virginia.

"Witness my hand and seal this 28th day of November, 1905.

"Jay C. Howell. [Seal.] "

Upon the completion of its organization and its acceptance of this assignment from Howell, the Colonna Dry Dock Company, Incorporated, sought to obtain from C. J. Colonna a conveyance of his three parcels of real estate mentioned and described in the option contract, which was declined by C. J. Colonna, on the ground mainly that the company had not acquired, as stipulated for in the option contract, the B. A. Colonna property, and the capital stock of the company to be issued was not as agreed in his contract, thereupon the bill in this cause was filed by the dry dock company against C. J. Colonna to enforce specific performance, not of the written contract of option given to Howell the 29th day of December, 1904, in all of its details, but of a substituted parol contract, alleged to have been entered into by the defendant with Howell subsequent to the written contract of option, whereby he agreed to an elimination of the B. A. Colonna property from the list of the properties that were to be acquired by Howell or his assigns, which were to form the basis of the organization of the contemplated joint-stock company.

To this bill Howell filed an answer, which he asked should be treated as a cross-bill, against C. J. Colonna and wife, in which, admitting as true nearly all of the averments in the original bill, it is alleged that the original option obtained from C. J. Colonnawas from time to time renewed, so that it expired on the 20th day of November, 1905, but that upon the sale of the B. A. Colonna property to another purchaser, on or about June 5, 1905, he (Howell) informed C. J. Colonna of this fact, and that another piece of property had been secured instead of the R. A. Colonna property, C. J. Colonna agreeing that the property secured was in every respect suitable for such purpose; that as a matter of fact the B. A. Colonna property never constituted a consideration to C. J. Colonna, but he (Howell) inserted it in the option contract "to show the relation between the properties and his property in the premises"; "that seven days after the expiration of the said option a new contract was entered into with C. J. Colonna, to which old option reference was made for the purpose of obtaining a description of the properties to be conveyed and the manner in which the same was to be paid for;" that C. J. Colonna not only agreed to the modification of said option, as set forth, but agreed to act as vice president of the Colonna Dry Dock Company, then to be formed; and "that the said company should have a capital stock of $200,-000, instead of $225,000, which reduction was made possible only by the fact that the said property of B. A. Colonna was no part of said agreement."

The "new contract" alleged to have been entered into seven days after the original option finally expired is as follows:

"This is to certify that J. C. Howell has this day deposited in the Merchants' and Mechanics' Savings Bank of Norfolk, Va., to my credit, the sum of fifteen thousand ($15,000.00) dollars, as part payment on the property sold to him by me for $185,000.00, which will more fully...