Krause v. MISSISSIPPI COAL CORPORATION

• Decision Date: 16 December 1937
• Docket Number: No. 6314-6322.,6314-6322.
• Citation: 93 F.2d 515
• Parties: KRAUSE v. MISSISSIPPI COAL CORPORATION et al. and eight other cases.
• Court: U.S. Court of Appeals — Seventh Circuit

93 F.2d 515 (1937)

KRAUSE v. MISSISSIPPI COAL CORPORATION et al. and eight other cases.

Nos. 6314-6322.

Circuit Court of Appeals, Seventh Circuit.

December 16, 1937.

J. Fred Gilster, of Chester, Ill., for appellant.

William P. McCool, of New York City, and Gunn, Penwell & Lindley, of Danville, Ill., for appellees.

Before SPARKS and MAJOR, Circuit Judges, and BALTZELL, District Judge.

BALTZELL, District Judge.

This is an appeal from a decree of the District Court dismissing, for want of prosecution, a bill for specific performance. There were eight similar suits which were dismissed at the same time, and for the same reason. For the purpose of the proceedings in this court, all cases have been consolidated. The cases thus consolidated with this case are Nos. 6315 to 6322, both inclusive. The conclusions reached in this opinion will apply equally to each of the consolidated cases.

On February 18, 1929, appellant filed, in the circuit court of Perry county, Ill., a bill for specific performance. It is alleged in the bill, among other things, that on May 19, 1927, one A. E. Montroy (hereinafter referred to as the landowner) entered into a contract, in which his wife joined, with appellant whereby, in consideration of $1, they gave to him an option to purchase their farm consisting of 80 acres, lying in Perry county, Ill. The optional contract, as shown by the copy attached to the bill of complaint as an exhibit, purported to grant to appellant the right to purchase such real estate at any time within a period of twelve months, upon payment to the landowner, by appellant or his assigns, the sum of $8,000. Provision was made therein for notice to be given by appellant to the landowner of his intention to exercise such option. It is further provided that the landowner will, within a reasonable time, and not to exceed thirty days after receipt of such notice of election, make, execute, and deliver to appellant or his assigns, a warranty deed for such real estate, together with an abstract of title therefor, at which time appellant agreed to pay the purchase price in full in cash, provided the abstract showed good and sufficient title, etc. It is further alleged in the bill that, on May 17, 1928, appellant gave written notice to the landowner of his intention to exercise the option, and requested the execution of a deed, etc., as provided therein; that another notice was given on June 29, 1928; that on September 25, 1928, a deed of conveyance for all coal and other mineral in and underlying the land in question was executed and delivered by the landowner to appellee Mississippi Coal Corporation; that, notwithstanding this conveyance, another notice was given the landowner on October 6, 1928. The bill of complaint in each of the eight consolidated cases contains similar allegations with reference to the optional contract, notice, etc. The suits seek to compel specific performance of the contracts. All of the cases were removed to the District Court, the instant case being removed on June 6, 1929. On July 25, following, appellee Mississippi Coal Corporation filed its motion to dismiss the bill and answer.

In so far as the record discloses, no further steps were taken until March 5, 1934, at which time, by leave of court and upon motion of appellant, the Electric Shovel Coal Corporation and its receivers were made parties defendant. No summons was issued, however, for these defendants, and no service had upon either of them. Neither of them appeared to the action, and neither is party to this appeal. Upon application of appellant, the case was continued from term to term thereafter, and no further steps were taken until on March 3, 1937, at which time appellee Mississippi Coal Corporation filed, by leave of court, an amendment to its motion to dismiss which had been on file for almost eight years. The amendment contained two additional specifications, one of which charged laches on the part of appellant, and the other charged that some of the property had been transferred to persons who were not parties to the action.

On March 30, 1937, the District Court filed a written memorandum opinion which contained a complete statement of the facts, with reference to the record, upon which its conclusions were based. A final decree was entered upon the same day, dismissing the cause for want of prosecution at appellant's costs, from which decree this appeal is being prosecuted.

There are four assignments of errors relied upon by appellant, as follows: First, the court erred in abuse of its discretion by dismissing this suit under rule VIII (5), rules of the District Court, after a hearing on the merits of defendant's motion to dismiss plaintiff's original bill; second, the court erred in granting the motion of the defendants to dismiss this suit on the ground of laches; third, the court erred in failing to add to its decree of dismissal that same was done without prejudice to the parties; fourth, the court erred in denying plaintiff's motion to reinstate.

The first and second assignments present the vital question, and may be considered together. Summarized, they present the simple question of whether or not the District Court abused its discretion in dismissing the bill. In determining this question, it must be kept in mind that this is a suit in equity and its disposition is governed by equity principles and the rules of the District Court. There was in force, at the time of the dismissal of the bill, a rule of the District Court which provided, in substance, that every cause in equity in which no orders had been entered or proceedings taken within the preceding six months, indicating an intention of the party to prosecute the same...