Epworth Assembly v. Ludington & N. Ry.

• Decision Date: 08 December 1926
• Docket Number: No. 52.,52.
• Parties: EPWORTH ASSEMBLY v. LUDINGTON & N. RY.
• Court: Michigan Supreme Court

236 Mich. 565

211 N.W. 99

EPWORTH ASSEMBLY

v.LUDINGTON & N. RY.

No. 52.

Supreme Court of Michigan.

Dec. 8, 1926.

Appeal from Circuit Court, Mason County, in Chancery; Harry J. Dingeman, Judge.

Action by the Epworth Assembly against the Ludington & Northern Railway. Decree for defendant, and plaintiff appeals. Affirmed.

Argued before BIRD, C. J., and SHARPE, SNOW, STEERE, FELLOWS, WIEST, CLARK, and McDONALD, JJ. Elvin Swarthout, of Grand Rapids (Clay F. Olmstead, of Ludington, Hopkins, Starr & Hopkins and Donald J. De Wolfe, all of Chicago, Ill., of counsel), for appellant.

A. A. Keiser, of Ludington, Barthell & Rundall, of Chicago, Ill., and John C. Shields, of Detroit, for defendant.

SHARPE, J.

On May 4, 1894, a contract was entered into between the Citizens' Development Company, of Ludington, a corporation, the Flint & Pere Marquette Railroad Company, and the Epworth League Training Assembly, a corporation, whose name was afterwards changed to the Epworth Assembly, the plaintiff herein. After recitals stating the purposes thereof, the development company agreed therein to convey certain real estate, lying along the shore of Lake Michigan and about two miles north of Ludington, to the assembly. It also agreed to pay to the assembly the sum of $1,000, and to attempt to secure donations in the sum of $10,000 from the citizens of Ludington to aid the assembly in the development of a resort on said land. It also agreed to furnish transportation during the season of 1894 and thereafter during the life of the assembly, and ‘to establish, construct, and operate a street railway, or procure the same to be established, constructed, and operated,’ from the railroad depot and steamboat dock to the grounds of the assembly, and have the same in operation not later than July 1, 1898. The railroad Company agreed to pay to the assembly $10,000, and to give reduced fares to its cottagers and free transportation to certain of its officers. The assembly agreed to erect permanent buildings on the land, and to hold a meeting thereon during the summer season for the period of 15 years, and to use its best efforts to make sale of lots and to establish a summer resort on said lands. The contract provided that, in case the assembly failed ‘to provide for such meetings and to carry on the kind of work herein designated and set forth,’ the land should revert to the grantors.

A more comprehensive statement of the object sought to be attained by said contract and the efforts of the assembly to perform on its part, resulting in the development of a beautiful summer resort on said land, will be found in the opinion in Epworth League Assembly v. Olney, 136 Mich. 50, 98 N. W. 860.

On May 22, 1894, the development company conveyed the land described in the contract to the assembly. A provision therein rendered it subject to the covenants and agreements contained in the contract. In March, 1895, the Epworth League Railroad Company was organized; the name being afterwards changed to that of defendant. On July 1, 1895, the assembly conveyed to the railroad company by deed a strip and land 50 feet in width, particularly described therein, ‘to be used for railroad purposes only.’ The road was built thereon and operated apparently without complaint for many years. It procured a franchise to operate a street railway on certain streets in the city of Ludington for the period of 30 years. The road did not reach the depot or docks of the Pere Marquette Railroad, as provided for in the contract.

In 1914, the assembly sought to have the road extended to land adjoining its resort on the north, which it had at that time secured. The defendant's officials claim that, owing to the uncertainty of the passenger business on the extension, it was agreed that it might extend the line to a large sand hill and haul sand therefrom in freight cars over its line. The extension was completed in July, 1915, and passenger trains as well as freight trains hauled over it that season. There being but one cottage on the addition, passenger service was discontinued in 1916. Freight trains, hauling the sand, were, however, run over the road. On November 28, 1916, after the road had been thus used for two seasons, the plaintiff executed to defendant a deed of a 5o-feet strip of land from the end of the line as theretofore constructed to the side of the addition nearest to the sand hill. This deed contained a provision for reverter hereafter quoted.

After 1914, the passenger business on defendant's line began to decrease. In 1918, less than one-third of the number carried in 1914 were transported. Quite early in 1919 there were negotiations between the defendant and the plaintiff, the Hamlin Association (interested in another resort), and the city commission, looking towards the substitution of a motorbus service between the city and the grounds of the plaintiff and the Hamlin Association for that of the railroad. It resulted in defendant's applying to the Michigan Railroad Commission for leave to discontinue its line through the city and to a point where by a siding it connected with the Pere Marquette Railroad Company's line. The commission, on July 2, 1919, declined to grant such permission. The application was later renewed, and on July 18, 1919, the Public Utilities Commission, which had, under an act of the Legislature, succeeded to the powers and duties of the Railroad Commission, made an order granting such permission. This order recites that it appeared to the commission that an agreement had been entered into between the parties interested and one Joseph D. Cooper, wherein Cooper had obligated himself to furnish transportation by motorbusses to take the place of that theretofore supplied by the railroad, and that all of the parties interested had consented thereto, whereas in fact the assent of the plaintiff's officials had not been secured. Plaintiff's secretary, however, had written a letter, saying that the matter could not be considered until a later meeting of its executive committee, but that he favored it and believed the committee would also do so. The city commission had instructed its clerk to execute this agreement and by resolution provide that upon its execution the franchise of the defendant should become null and void. The railroad roadbed, for which permission to discontinue its use had been granted by the Utilities Commission, was soon after torn up. Defendant continues to do a freight business in switching cars received by it from the Pere Marquette Railroad Company to and from certain factories along its line and also in hauling sand from the sand hill north of the river.

On July 29, 1921, plaintiff filed its bill of complaint herein. In its prayer for relief it asked:

(1) That the court issue its mandatory injunction directing defendant to relay its tracks and to resume the passenger service.

(2) That defendant be enjoined from transporting or conveying sand over its line where it passes through plaintiff's premises.

(3) That the court decree that, by reason of the provisions in the deeds of July 1, 1895, and November 28, 1916, the title to the strips conveyed have reverted to plaintiff.

(4) That plaintiff be decreed its damages sustained by reason of the discontinuance of passenger service on said road.

After the proofs were submitted, the trial court concluded: (1) That the defendant was under no contractual obligation with plaintiff to furnish such transportation; (2) that plaintiff's remedy, if defendant's deeds have become void for the reason stated, was by an action of ejectment; (3) that plaintiff had not made out a case entitling it to equitable relief. He expressed a willingness to transfer the cause to the law side of the court, but plaintiff declined to do this and brings the case before us by appeal from the decree entered.

1. Specific performance.

Plaintiff's prayer for a mandatory injunction is, in effect, an appeal to the court to require the defendant to specifically perform the obligations entered into by the development company in the tripartite agreement of May 4th. The only contract relations existing between the plaintiff and defendant are evidenced by the deeds of July 1, 1895, and November 28, 1916, heretofore referred to. In the first of these deeds it was said that this land was ‘to be used for railroad purposes only,’ and in the second that, if the land conveyed shall at any time ‘cease to be used for railroad purposes' for one year, it shall revert to the grantor. These provisions in no way bind the defendant to maintain and operate a train or cars affording passenger service from Lundington to plaintiff's grounds. In fact, such an undertaking taking is negatived by the provision for reverter contained in the latter deed. The habendum clause in the deed first exeacuted reads:

‘To have and to hold the above-granted premises to the said party of the second part, its successors and assigns forever, for the uses above expressed, subject to the reversionary clause covered by deed from the Citizens' Development Company, to said first party and the contract between the Citizens' Development Company, to said first party and the contract between the Citizens' Development Company, the F. & P. M. R. R. Company and the Epworth League Training Assembly now of record in the office of register of deeds of Mason county.’

This provision was evidently inserted to protect the grantor on its warranty in view of the provision for reverter to the development company, contained in the contract, to which the deed from that company was made subject.

It is plaintiff's claim,...