Midwest-Radiant Corporation v. Hentze

• Decision Date: 30 November 1948
• Docket Number: No. 9413.,9413.
• Citation: 171 F.2d 635
• Parties: MIDWEST-RADIANT CORPORATION v. HENTZE.
• Court: U.S. Court of Appeals — Seventh Circuit

171 F.2d 635 (1948)

MIDWEST-RADIANT CORPORATION v. HENTZE.

No. 9413.

United States Court of Appeals Seventh Circuit.

November 30, 1948.

Henry Driemeyer, of East St. Louis, Ill., Frederick E. Merrills, of Belleville, Ill., Harold L. Reeve and Elmer M. Leesman, both of Chicago, Ill., and Isaac C. Orr and Laura Andreas, both of St. Louis, Mo., for appellant.

Sam S. Pessin, of Belleville, Ill., David F. Root and Leonard Hoffman, both of Morris, Ill., and Preston K. Johnson, Sr., and Preston K. Johnson, Jr., both of Belleville, Ill., for appellees.

Before KERNER and MINTON, Circuit Judges, and BRIGGLE, District Judge.

KERNER, Circuit Judge.

Plaintiff instituted this action for a declaratory judgment pursuant to § 274d(1) of the Judicial Code 28 U.S.C.A. §§ 2201, 2202. Federal jurisdiction is founded upon diversity of citizenship and the requisite amount in controversy. Plaintiff sought a decree that defendant Northern Illinois Coal Corporation (hereinafter referred to as Northern) had no right, title or interest to the coal underlying certain real estate in St. Clair County, Illinois, and that a certain lease entered into by and between the Hentze defendants and plaintiff was a valid and subsisting agreement.

The controlling facts are not in dispute. On March 20, 1902 Augusta Keim was in possession of and owned an eighty-acre farm near Lenzburg, Illinois. On that day she executed an instrument,¹ which was recorded in the office of the Recorder of Deeds of St. Clair County, Illinois. The instrument recited that Thomas, the person named in the instrument as grantee, was to "have the sole right to mine and produce and to enter upon said land, sink shafts * * * and erect any and all structures necessary for said purposes of mining and producing coal"; that he was to pay as royalty "One and one-half cents per ton, mine run, for each and every ton of coal mined"; and that he was "to commence sinking a mine at Lenzburg in six months * * * and have same in operation in one year from that date or this deed is to be void."

On May 7, 1902 Thomas obtained from one Prediger a bond for deed for a tract of land about one-half of a mile north of the Keim farm, the condition of which was that Thomas was to sink a coal shaft. During the summer of 1902 Thomas did commence sinking a coal shaft on the Prediger land but the mine was not placed in operation, and was abandoned during the latter part of 1902 or early in 1903, before coal was reached, and Thomas did not at any time after March 20, 1902 begin or sink any other mine at Lenzburg or in the vicinity thereof. No mine was ever sunk upon the land described in the Keim-Thomas instrument, no coal was ever mined or removed from the land, and Thomas never entered upon or took possession of the coal thereunder, or made any payment of royalty to Keim or anyone claiming under her.

Augusta Keim was in possession of her farm after the execution of the Keim-Thomas instrument until July 16, 1909, when she conveyed it by warranty deed to Ernest W. Hentze, predecessor in title of defendant John W. Hentze. The deed to Ernest W. Hentze contained no reservation or exception to any coal that might be underlying the real estate, but warranted the title to the entire fee. Ernest W. Hentze took possession of the farm, and this farm since that time has at all times been in the exclusive possession of members of the Hentze family.

On October 5, 1944 John W. Hentze, owner of the real estate, as lessor, entered into a mining lease with plaintiff, as lessee, whereby Hentze leased his farm to plaintiff for a term of thirty years for the purpose of mining coal. On November 27, 1944, more than forty years after the execution of the Keim-Thomas instrument, Northern procured from Thomas a quitclaim deed of the interest he had acquired by the Keim instrument.

The trial judge was of the opinion that the Keim-Thomas instrument possessed "all the requisites of a quitclaim deed" and "was effective to convey the interest owned by the grantor in the property described therein." He also held that the provision that the grantee should commence sinking a mine at Lenzburg within six months and have the same in operation within one year thereafter or the deed would become void, was a condition subsequent, and that if the Keim-Thomas instrument was to be regarded as a quitclaim deed instead of an agreement in the nature of a mining lease, it should be regarded as a deed upon condition subsequent; that Thomas did not lose his estate under the deed merely by nonfulfillment of the condition subsequent or by reason of abandonment, and that Thomas' estate remained vested in him at the time he gave the quitclaim deed to Northern. He entered a judgment that John W. Hentze was the owner of the real estate; that Northern was the owner of the coal underlying the land; and that the lease agreement between plaintiff and the Hentzes was void and of no effect. To reverse the decree, plaintiff appealed.

The all important question is the interpretation to be put upon the Keim-Thomas instrument, that is, the problem is one of construction.

Appellant contends that by the instrument Mrs. Keim did not intend to vest title to her coal in Thomas until he placed a mine in operation; that it was the duty of the court to give effect to the intention of the parties as manifested by the instrument in its entirety, interpret it in the light of the situation of the parties, consider the objects which they sought to attain, and give the instrument the practical construction which they themselves placed on it; that the instrument should be construed as a mining lease which was terminated by abandonment, and that when so construed, the instrument accomplished for both parties what their interests required, with no undue advantage to one or harsh disadvantage to the other; that in any event this court should not hold that the instrument created a technical common law estate upon condition subsequent; and that even if it be assumed that it was a grant, still the abandonment clause should be given effect.

On the other hand, Northern, the only appellee in this appeal, argues that the words of conveyance in the instrument were "convey and quit-claim," hence it contained all of the requisites to constitute a valid conveyance of real estate as prescribed by Ill.Rev.Stat. c. 30, § 9 (1947); that the words were sufficient to convey title; that such an instrument has been held to be sufficient to convey the property described therein; that the court properly determined the instrument to be a quitclaim deed conveying a fee simple estate in the coal to Thomas, and that Thomas could not be divested by non-user or abandonment.

To be sure, the general rule under the Illinois statute is, that the words "convey and quit-claim" are sufficient to convey title, but where an instrument even in statutory form contains no words of inheritance, it must be construed as a whole, Tallman v. Eastern Illinois & P. R. R. Co., 379 Ill. 441, 444, 41 N.E.2d 537, and since the object of construction of deeds is to ascertain the intention which the maker of an instrument has expressed, a deed will, if possible, be construed so as to give effect to the intention of the parties as gathered from a consideration of the whole instrument. Walker v. Illinois Cent. R. Co., 215 Ill. 610, 618, 74 N.E. 812; Bear v. Millikin Trust Co., 336 Ill. 366, 388, 168 N. E. 349, 73 A.L.R. 173; Kinder v. La Salle County Carbon Coal Co., 310 Ill. 126, 132, 141 N.E. 537; Texas Co. v. O'Meara, 377 Ill. 144, 150, 36 N.E.2d 256; Tallman v. Eastern Illinois & P. R. R. Co., supra; In re Chicago & N. W. Ry. Co., 7 Cir., 127 F.2d 1001; and Shadden v. Zimmerlee, 401 Ill. 118, 81 N.E.2d 477. In ascertaining the intention courts are not confined to a strict construction of the language used. The court should look to the circumstances attending the transaction, the situation of the parties, the state of the thing granted and the object to be attained, Goodwillie Co. v. Commonwealth Electric Co., 241 Ill. 42, 72, 89 N.E. 272; Adams v. Gordon, 265 Ill. 87, 91, 106 N.E. 517; and Law v. Kane, 384 Ill. 591, 52 N.E.2d 212, and, if necessary, put itself in the place of the parties, read the instrument in the light of the circumstances surrounding them at the time it was executed, and give consideration to the practical construction which the parties themselves placed on the instrument, Storey v. Storey, 125 Ill. 608, 613, 18 N.E. 329, 1 L.R.A. 320, 8 Am.St.Rep. 417; Wright v. Loring, 351 Ill. 584, 589, 184 N.E. 865; Henry v. Metz, 382 Ill. 297, 300-303, 46 N.E.2d 945; and Law v. Kane, supra, 384 Ill. 596, 52 N.E.2d 212, and an unreasonable construction which would work a result different from that intended, should not be adopted, McCoy v. Fahrney, 182 Ill. 60, 65, 55 N.E. 61.

The precise question — whether an instrument identical with or similar to the Keim-Thomas instrument and executed under similar circumstances is a deed or merely a lease, or whether, if construed as a grant, it is to be held one on condition precedent or one on condition subsequent — so far as we have been able to learn, has never been passed upon by the Illinois courts. We are therefore not precluded from deciding the case before us on sound principles and precedents. Vandenbark v. Busiek, 7 Cir., 126 F.2d 893.

Appellant makes the point that an abandonment clause such as that contained in the Keim-Thomas instrument is a valid provision, to which the law will give effect, irrespective of whether it is contained in a mining grant or a lease. The trial judge, as we have already observed, held that because the instrument contained the words "convey and quit-claim" it was necessary to classify it as a "grant" rather than a "mining lease." It was upon this premise that he concluded that...