Doak v. Hamilton

• Decision Date: 19 November 1926
• Docket Number: No. 2508.,2508.
• Citation: 15 F.2d 774
• Parties: DOAK v. HAMILTON.
• Court: U.S. Court of Appeals — Fourth Circuit

15 F.2d 774 (1926)

DOAK v. HAMILTON.

No. 2508.

Circuit Court of Appeals, Fourth Circuit.

November 19, 1926.

Marcus Erwin and Frederick W. Thomas, both of Asheville, N. C., for appellant.

Joseph F. Ford, of Asheville, N. C. (Lee, Ford & Coxe, of Asheville, N. C., on the brief), for appellee.

Before WADDILL and PARKER, Circuit Judges, and SOPER, District Judge.

SOPER, District Judge.

The bill of complaint in this case, alleging that the defendant was in unlawful possession of certain land belonging to the plaintiff, was brought for the purpose of securing an injunction permanently enjoining the defendant from using and operating a quarry located on the premises, and from trespassing thereon, to remove a cloud from the title to the property, to secure compensation for damages to the buildings resulting from the operations of the defendant, and to obtain payment for certain stone removed from the quarry, and for other and further relief. An answer was filed, denying that the plaintiff was entitled to possession of the property, or to damages or payment of any sort, but claiming, by way of cross relief, that the defendant was entitled to damages for the interference to his business occasioned by a restraining order passed in the case at the instance of the plaintiff.

On March 15, 1920, Mrs. Katherine E. Hamilton, the plaintiff, sold to the defendant, William C. Doak, certain quarry machinery situated at the quarry, for the sum of $4,000; and, on the same day, Mary Hamilton, the plaintiff's daughter, leased to the defendant "that certain stone quarry, together with fifteen acres of land, located on Beaucatcher Mountain, on both sides of the road leading from Atkins street entrance to the home of the party of the first part on said mountain, for a term of five years from the date hereof," with the right, at the expiration of the lease, to renew it upon the same terms and conditions for an additional period of five years. The lessee agreed to pay to the lessor 20 cents per ton for stone quarried and removed from the premises, in monthly payments, stipulating that, if in any one month the royalties did not amount to the sum of $100, that sum should be paid as a minimum rental. The lessee also agreed to keep the buildings on the premises in good repair, and to remove the waste from the operation of the quarry, so that it would not accumulate upon the premises. The lease also provided that the lessee should have the option to purchase, at any time during the term of the lease or the renewal thereof, the quarry property leased, "together with fifteen acres of land covering the quarry, located on both sides of the road leading up to the mountain, at the price of $16,000." Finally it was agreed that, if the lessee should fail to keep and observe his covenants and agreements, or should fail to pay the rentals as stipulated, the lease should immediately terminate, and all rights of the lessee thereunder should cease.

On July 7, 1920, the lessor conveyed the reversion of the property to her mother, and all further proceedings in the matter were carried on between the latter, as successor to the lessor, and the defendant. Doak took possession on May 1, 1920, and from the beginning, it was a very difficult matter to collect from him the rentals or royalties due under the lease. Certain conferences took place between the parties, and a full settlement of all differences was made as of October 1, 1921. But the defendant did not thereafter comply with the terms of the lease; and consequently the bill of complaint, praying the relief above described, was filed on April 12, 1923, in the Superior Court of Buncombe County, North Carolina. The suit was subsequently removed to the District Court of the United States for the Western District of North Carolina. On January 3, 1924, Mrs. Hamilton conveyed to one Ralph B. Arbogast certain tracts of land adjoining one another, amongst which were the leased premises.

The case was referred by the District Court to a standing master, who made a report of his findings of fact and conclusions of law on September 25, 1925. He found, in substance, that prior to the execution of the lease, the defendant, together with a real estate agent and the plaintiff, viewed the quarry premises and spent a little time looking over the properties and the boundaries; but the quarry premises were never described or laid out by definite lines, metes, or bounds. The master further found that in 1920, when the lease was made, the buildings and equipment of the owner were not new, but were susceptible of use for quarry purposes; that the defendant had not kept them in repair, as he agreed, with the result that in February, 1925, and in September, 1925, when the report was filed, they were in a dilapidated condition, from which the plaintiff suffered damages to the extent of $250. He also found that the defendant had failed to remove the waste or débris from the quarry, as he had agreed, and thereby the plaintiff was damaged in the additional sum of $250. He made no findings as to the condition of the buildings or waste at the time the suit was begun. On the other hand, he found that the defendant had been damaged to the extent of $500 by the restraining order secured by the plaintiff.

It was also found that for a period of eighteen months prior to the suit — that is, from October, 1921, to March, 1923, inclusive, the defendant made and the plaintiff accepted as royalty on the stone quarried and removed, eighteen payments amounting to the aggregate sum of $1,715.20. The defendant failed to pay the minimum monthly royalty of $100 in July and December, 1922, and January and February of 1923, and paid only $427.60 between October, 1921, and March, 1922. The record does not show in what months in the last mentioned period the royalty was deficient. For the nine months between the institution of the suit and the transfer to Arbogast — that is, from April to December, 1923 — the defendant made nine payments amounting to $727, but failed to pay the minimum royalty in seven months. These payments (except that for December, 1923, which was payable on or before January 10, 1924) were also accepted by the plaintiff. After the transfer, the plaintiff refused to accept the royalties, and the money was paid into court. For a period of twenty months, from January, 1924, to August, 1925, the defendant made twenty payments, amounting to $1,172.50, but failed in each month to pay the minimum royalty. The master found that the plaintiff at no time agreed to relinquish the minimum monthly royalty, and therefore held that the plaintiff was entitled to recover the amount of the deficiency for every month in which it occurred, and declared that the sum thus due was $1,290.80, beginning with the month of July, 1922, and extending through the month of August, 1925. It may be noted in passing that it is not apparent from the record how this figure was reached. The deficiency which occurred in the period from October, 1921, to March, 1922, seems to have been ignored; and there are mistakes of addition in the record so obvious as to lead one to suppose that errors by the copyist or printer have been made. We are unable, from the record before us, to determine precisely what royalty payments were made or accepted. The case is submitted to us on the master's findings of fact and there is no evidence in the record except that which was introduced to establish the boundaries of the property.

After the master's report, there was a hearing before the District Court and a final decree which recited that the description in the lease was fatally defective and contained no definite description by metes and bounds, or any sufficient reference by which the fifteen acres of land mentioned in the lease could be identified or located; that the defendant had broken the covenants on his part to pay the minimum rental, to keep the buildings in good condition, and to keep all dirt and débris removed from the premises; and that the plaintiff had the right under the lease to declare and had declared the contract terminated. Therefore it was decreed that the lease constituted a cloud upon the plaintiff's title to the property, was void and of no effect, and should be canceled of record; that the plaintiff was entitled to the sum of $1,290.80 for damages to the property and for rentals due for the occupancy and use of the same, and that the funds paid into the hands of the court, during the pendency of the action, belonged to the plaintiff as royalties from the quarry, and should be paid to her. It was further ordered that the defendant immediately deliver possession of the quarry and premises to the plaintiff.

From this decree the defendant appealed, contending that no relief should have been granted to the plaintiff but the bill of complaint should have been dismissed, because after the suit was begun, the plaintiff conveyed all her interest in the land to Arbogast. The statement of fact is correct, for the master found "that on or about the 3d day of January, 1924, the plaintiff conveyed to one Ralph B. Arbogast of Buncombe county, N. C., certain tracts of land, among which tracts were the premises leased on March 13, 1920, by Mary Hamilton to the defendant; the said deed of plaintiff to Arbogast containing, however, this clause: `Excepting, however, such rights as one William C. Doak may have in and to what is known as the rock quarry by reason of a certain lease and contract made and entered into by and between Mary Hamilton and the said William C. Doak in March, 1920.'" Obviously the interest of the lessor was not thereby reserved. The only interest not conveyed to Arbogast was that which could not be conveyed because it had already been granted to Doak. The exception in his favor was no doubt inserted in order to call his outstanding interest to the attention of the grantee, and to except it from the operation of the grantor's warranties.

The...