Piedmont Land & Imp. Co. v. Piedmont Foundry & Machine Co.

• Decision Date: 09 June 1892
• Court: Alabama Supreme Court
• Parties: PIEDMONT LAND & IMP. CO. v. PIEDMONT FOUNDRY & MACHINE CO.

11 So. 332

96 Ala. 389

PIEDMONT LAND & IMP. CO. v. PIEDMONT FOUNDRY & MACHINE CO.

Supreme Court of Alabama

June 9, 1892

Appeal from chancery court, Calhoun county; S. K. MCSPADDEN Chancellor.

Bill in equity by the Piedmont Land & Improvement Company against the Piedmont Foundry & Machine Company. From a decree for defendant, complainant appeals. Affirmed.

Cooke & Cooke, for appellant.

Matthews & Whiteside, for appellee.

THORINGTON J.

The bill of complaint filed by appellant, although somewhat vague in some of its averments, makes substantially the following case: Appellant is a corporation under the laws of this state, and its place of business is in the town of Piedmont. It was organized for the purpose of developing that town, and to that end has expended large sums of money. In furtherance of its general purpose to improve the town by encouraging the establishment of manufacturing therein and otherwise, in May 1890, it agreed to assist the Piedmont Foundry & Machine Company, also a corporation, with land and money, and said last-named company (appellee) commenced business in said town in said month of May by erecting buildings on lands belonging to appellant, and by putting machinery in said buildings suitable for the business contemplated by said company. It was understood and agreed between the two companies that the aid in lands and money extended by appellant to appellee was on the condition that the works of appellee should be kept by said company in full operation for at least two years from the time the company commenced work, which was in June, 1890. While this was the principal consideration for the land and money furnished by appellant to appellee, the former expected to derive incidental benefit from the building and operation of appellee's works "by the increased value of appellant's other property in the event appellee's said works should be honestly and successfully operated, and their said agreement and promise carried out in good faith." Appellant, relying on such promise, and that appellee would faithfully comply therewith, and for the purpose of promoting the success of appellee's enterprise, from time to time in the months of August, September, and October, 1890, advanced to appellee various sums of money, aggregating $662, which appellant was led to believe would be used in buying machinery for and otherwise improving appellee's plant, and carrying out the purpose of its creation, and said money was in fact so used. On the 2d of October, 1890, in compliance with the agreement, and relying thereon, and still further to promote the objects appellee pretended to have in view, appellant, at the instance and request of appellee, conveyed to it three acres of land in the town of Piedmont, on which land appellee's works had been constructed. A copy of the deed is attached to the bill, and recites a consideration of "one dollar and other good and valuable considerations," which deed, it is alleged, was executed by appellant upon the representation of appellee that it was necessary for it to have the deed in order to support its credit, and to enable it to carry out its promise and agreement to operate its works successfully for at least two years; but there is no express averment that this was untrue. Immediately after the deed was executed and delivered, appellee ceased to operate its works, and they have remained idle since, and it is alleged that appellee has no intention to resume work in the future, and that said deed was procured by misrepresentation and fraud. It is also alleged that appellee, through wasteful negligence and mismanagement, has become heavily indebted, and is insolvent, and has advertised all its property for sale at public outcry, and that, if the sale is allowed to take place, appellant will sustain irreparable damage; that appellee has wholly failed to comply with its agreements and promises which were the consideration for the advance made by appellant to appellee of said sum of $662, and that a "resulting" trust exists in appellant's favor in the property and effects of appellee to the extent of said sum. The prayer of the bill is for an injunction and receiver, that a "resulting" trust may be declared in the property to the extent of the money so advanced, that the deed may be declared void, and for general relief. A temporary injunction was granted, and thereupon appellee filed its answer under oath, denying all the material allegations of the bill, and setting up defensive matter. It also filed a demurrer to the bill, and a motion to dismiss for the want of equity; and appellant filed a motion to strike the demurrers and answer from the file on the ground that they were not filed by any person who had authority from appellee in that behalf. The chancellor overruled the last two motions, dissolved the injunction on the denials in the answer and for want of equity in the bill, and dismissed the bill on appellee's motion for the want of equity.

It nowhere appears from the averments of the bill whether the alleged promise or agreement claimed to be the consideration for the money advanced by appellant to appellee, and for the deed executed by the former to the latter, was in writing. If it was verbal, and consequently within the influence of the statute of frauds, that fact must be made to appear by plea or answer. On demurrer, and on motion to dismiss the bill for want of equity, the contract alleged in the bill must be taken to be in writing. Trammell v. Craddock, 93 Ala. 450, 9 South. Rep. 587; Manning v. Pippen, 86 Ala. 357, 5 South. Rep. 572. On motion to dismiss a bill for the want of equity, amendable defects in the bill will not be considered, but are regarded as amended. Such is the defect in the present bill, wherein it is averred that the deed was made to the "Piedmont Land & Improvement Company," when it is apparent that appellee was intended. This defect however, was cured by the copy of the deed attached to the bill as part thereof, and from which copy the name of the proper grantee (appellee) is made to appear. Harland v. Person, 93 Ala. 273, 9 South. Rep. 379. Treating the contract as being in writing, and looking alone to the averments of fact in the bill, as we are bound to do on demurrer and motion to dismiss the bill for want of equity, the consideration for the alleged advance of the money and the deed mentioned in the bill was appellee's promise to operate its works for the period of two years from the time it should commence work, and the incidental benefits appellant expected to realize therefrom in the consequent enhancement of the value of its property in said town. This is a valuable consideration both for the advance of the money and in support of the deed, and it is no infringement of the general rule to permit such consideration to be averred and proved notwithstanding the deed may recite a moneyed consideration. Wilkerson v. Tillman, 66 Ala. 532; Mason v. Buchanan, 62 Ala. 110. Giving the fullest effect, however, to the contract, it is simply a promise or agreement to do an act in the...