Little Rock Granite Co. v. Shall

• Decision Date: 14 July 1894
• Citation: 27 S.W. 562,59 Ark. 405
• Parties: LITTLE ROCK GRANITE CO. v. SHALL
• Court: Arkansas Supreme Court

27 S.W. 562

59 Ark. 405

LITTLE ROCK GRANITE CO. v. SHALL

Supreme Court of Arkansas

July 14, 1894

Appeal from Pulaski Chancery Court, DAVID W. CARROLL, Chancellor.

Decree reversed and affirmed.

E. W Kimball and Caruth & Erb for appellant.

Courts of equity have always abhorred forfeitures and refused to enforce them, and, latterly, courts of law have done likewise. When a tenant has forfeited his lease by breach of the covenant to pay rent, courts of law and equity consider the clause of re-entry as a mere security, and will interfere in the tenant's behalf, although all the formality of a common law demand may have been complied with. Taylor on Land. & Ten. sec. 495; 1 Bush, 173; 11 Metc. (Ky.) 112. No demand was made here, and there can be no forfeiture. Wood Land. & Ten. sec. 452, p. 472. None of the breaches are sustained by the proof.

Blackwood & England for appellee.

This is not an effort to forfeit a lease for non-payment of a fixed rent on a fixed day, and the authorities cited by appellant are not in point. The rent was contingent, and was to be determined by the covenants in the lease, and paid at least once a month. Instead of thirty-six payments, only three were made--two of them after suit. Whatever may be the rule in case of fixed rents, as in 1 Bush, 173, they will not relieve against a a breach of a covenant or condition, such as to repair, to render an account, to pay taxes, etc., and such covenants as in this case, inserted not as security for rent but as a guaranty of the amount of rent, etc. 2 Story, Eq secs. 1319, 1320, 1321; 1 Pom. Eq. sec. 454; 2 ib. sec. 826, note 2; 2 Taylor, Land. & Ten. sec. 496. See, also, 96 Pa.St. 310.

OPINION

WOOD, J.

This was an action at law, brought in the Pulaski circuit court, to recover the possession of a tract of land, embracing a rock quarry, belonging to the plaintiff, Elizabeth S. Shall, and leased to the assignor of the defendant, the Little Rock Granite Company, in 1887, for a period of ten years. The lease contains certain covenants whereby the lessee bound himself to pay seven cents per cubic yard for all rock sold or taken from the quarry, to be paid as the work progresses, "or at least as often as once per month for all rock delivered to that date;" and also to furnish copies "of all contracts to deliver rock before the delivery of the same." He further agreed that a failure to do a reasonable amount of work--that is, to work at least an average of ten men per month for three consecutive months--"should forfeit the lease at the option of the lessor;" and also, at her option, the lease should be forfeited by a failure to perform either of the other covenants mentioned, or to use the quarry in a workmanlike manner, and with proper drains.

The lease was assigned to the defendant in October, 1889, with the consent of the plaintiff's agent, and this suit was commenced in February, 1891. The complaint alleges the non-payment of any rent or royalty by the Granite Company, and that it has broken all the other covenants of the lease. The prayer is for a judgment forfeiting the lease, and for recovering the rent due, and for the possession of the demised premises.

The answer alleges a tender of all sums due under the lease, and denies a breach of either of the covenants. It contains a statement of the reason why the rents were not paid, and alleges a readiness and willingness at all times to settle, and that it was not the company's fault that the settlement had not been made. In short, the answer contains matters of equitable defense against forfeiture, and concludes with a prayer that the cause be transferred to the Pulaski chancery court. On motion of defendant the case was transferred to the chancery court, without objection, where the cause was heard upon conflicting evidence as to the material matters in issue, and a decree rendered forfeiting the leasehold estate of the defendant, and for the possession of the premises, and the recovery of a sum found due as rent. The defendant appealed.

It is well settled that equity, as a general rule, will not enforce a forfeiture. In Marshall v. Vicksburg, 82 U.S. 146, 15 Wall. 146, 21 L.Ed. 121, it was said: "Equity never, under any circumstances, lends its aid to enforce a forfeiture." The rule is not less broadly stated in Story's Equity, and by the authorities generally. 2 Story, Eq. sec. 1319; 4 Kent. Com. 131. Mr. Pomeroy says that there are some apparent, but no real, exceptions to this doctrine, and that it is well settled "that a court of equity will not enforce a forfeiture, but will leave the party entitled to it to his legal remedies, if any, even though the case might be one in which no equitable relief would be given to the defaulting party against the forfeiture." 1 Pom. Eq. Jur. secs. 459, 460.

The plaintiff, desiring a forfeiture, selected the proper forum to declare it; and she was clearly entitled to have the law court pass upon the question, notwithstanding the filing of an answer containing some grounds of equitable defense. Mansf. Dig. secs. 1380, 1381, 4929; Act April 1, 1885, sec. 12; see, also, Mansf. Dig. secs. 5033, 5408, 5409. All the breaches complained of, that could be held sufficient to forfeit the lease, were denied, and the answer does not set up any matter to avoid a forfeiture that would not have been available in the circuit court; for a court of law, though not clothed with all the powers of a court of equity to grant relief in such cases, will construe with strictness the conditions on which a forfeiture is claimed, and a cause of action to recover damages for a breach of the covenant does not necessarily carry with it the right to a forfeiture. A forfeiture is odious to the law, and a court of law may not only grant relief against it, upon an equitable defense, but will ordinarily refuse to enforce it because of a failure to perform an act the performance of which has not been demanded, or where compensation can be made to the party complaining. Atkins v. Chilson, 11 Met. (Mass.) 112; Insurance Co. v. Norton, 96 U.S. 234, 24 L.Ed. 689; Bowman v. Foot, 29 Conn. 331; Tate v. Crowson, 6 Ired. Law 65.

But while it was the right of plaintiff to have the court of law determine this cause, it appears that she waived this right by not objecting to the transfer, provided the answer contains matters of equitable cognizance. The answer, as to the failure to pay rents and furnish copies of contract, was in the nature of confession and avoidance. It...