Yard v. Yazoo & Mississippi Valley Railroad Company

• Decision Date: 25 October 1909
• Docket Number: 14,163
• Parties: KEYSTONE LUMBER YARD v. YAZOO & MISSISSIPPI VALLEY RAILROAD COMPANY
• Court: Mississippi Supreme Court

50 So. 445

96 Miss. 116

KEYSTONE LUMBER YARD v. YAZOO & MISSISSIPPI VALLEY RAILROAD COMPANY

No. 14,163

Supreme Court of Mississippi

October 25, 1909

FROM the chancery court of Yazoo county, HON. G. GARLAND LYELL Chancellor.

The Keystone Lumber Yard, a corporation, appellant, was complainant in the court below; the railroad company appellee, was defendant there. From a decree sustaining defendant's demurrer to the bill, and dismissing the suit, the complainant appealed to the supreme court.

The opinion of the court sufficiently states the facts. The decree of the court below contains the following:--"The court is of the opinion that the defendant company cannot be compelled to discover as prayed for by the bill, because such discovery will subject defendant to the imposition of penalties, hence the demurrer is sustained and the complainant's bill is dismissed without prejudice to the complainant's right to proceed at law."

For prior litigation relative to the matter here in controversy see Keystone Lumber Yard v. Yazoo, etc., R. Co., 94 Miss. 192, 47 So. 803.

Reversed.

Brown &amp Norquist, for appellant.

The precise question involved here is, whether equity will enforce a discovery of the cause of delay in the transportation of car load lots of freight, when such discovery will subject defendant to the reciprocal demurrage charge fixed by the state railroad commission, or, whether such discovery will be denied, on the theory that "courts of equity * * * undertake to disregard and nullify, by refusing their aid in proper cases, the expression of the will of the lawmaking power," under the pretext that such charges are "fines and penalties." We submit that no such rule of equity exists, or ever did exist. The contention to the contrary is based upon the expression, "these rules for affixing penalties for undue detention of the cars, were not devised for the benefit of the railroad company alone," in reference to demurrage charges due the railroad companies, to be found in the opinion of the court in the Searles case, 85 Miss. 543, and the quotation thereof in the Keystone Lumber Yard case, 90 Miss. 406, although the court, in the latter case, on page 407, repudiated the suggestion that they were "fines and penalties," and although the word "penalties," in the first instance, was evidently used in its general sense.

The reciprocal demurrage charges are, of course, no more penalties than are demurrage charges. The one is compensation for undue delay in transit, the undue detention of the shipper's property; and the other is compensation for undue delay in unloading; the undue detention of the railroad's property. If there were no demurrage charges fixed by law, shippers could be made to pay for the damage ensuing from undue delay in unloading; if there were no reciprocal demurrage charges fixed by law, a railroad company could still be made to pay for the damages ensuing from undue delay in transportation. Both are alike founded in the soundest common sense and highest spirit of equity. Each is equitable compensation, the one no less than the other.

There can be no doubt that courts of equity will enforce discovery which falls short of subjecting the defendant to prosecution for a public offense or indictable crime, even though it compel the disclosure of fraud or the basest moral turpitude. Watts v. State, 24 Miss. 77.

It never was the law that a discovery would be denied in equity simply because it would enable the complainant to recover, or the defendant to defeat, the debt or demand sued for. It must subject to the loss or forfeiture of something distinct from, or collateral to, that which is sued for, or subject the party defendant to a penalty or indictment. Conant v. Dolafield, 3 Ed. Ch. 201; Hare on Discovery, part 3, par. 1; Sharp v. Sharp, 3 Johns. Ch. 407.

Equity will enforce a contractual forfeiture, whenever the jurisdiction attaches on some ground independent of such relief, as in the case of a clear legal right to the forfeiture, where the legal remedy is inadequate. Vicksburg, etc., R. Co. v. Ragsdale, 54 Miss. 208. The legal remedy here is inadequate, because the discovery is essential to its enforcement. The penalties which equity will not enforce are those fixed by contracts of the parties, and not those fixed by statute. Lafayette County v. Hall, 70 Miss. 678. Nor will it decline to enforce a claim for liquidated damages, although, in a generic sense, such may be termed a penalty. Pomeroy, Eq. Juris. 440.

At first blush, the case of Mississippi Railroad Commission v. Gulf, etc., R. Co., 78 Miss. 750, may seem to conflict with Lafayette County v. Hall, supra, but it does not. In the latter case the penalty was in the nature of liquidated damages, as well as statutory, like unto damages for delinquency in the payment of taxes. Burlington v. Burlington R. Co., 41 Iowa 134. In the former case, the penalty was under Code 1892, § 4329, for the commission of a public offense--a pure penalty, under a penal law, and not simply in the nature of a penalty. Huntington v. Attrill, 146 U.S. 657; Wisconsin v. Pelican Insurance Co., 127 U.S. 265; Green v. Weaver, 1 Sim. 404.

Mayes & Longstreet, for appellee.

It is patent that the demand sued on is purely legal. This is a suit merely to recover penalties, alleged to be due under the demurrage rules of the state railroad commission. The bill itself is practically in the form of a declaration at law, and the right, if any, is at law, the remedy in the law courts being entirely sufficient and adequate.

Section 147 of the present constitution of Mississippi of 1890 was not enacted to vest in the chancery court any special jurisdiction not possessed by that court under its ancient and original equity jurisdiction, except insofar as jurisdiction of certain other subjects is added to this original jurisdiction of such court by other constitutional provisions, or by statutes of the legislature not necessary here to consider.

The constitutional section never abolished the distinction between the chancery and the law courts. Demands at law are no more cognizable in equity, as a general rule, now, than they were prior to the adoption of the constitution of 1890.

Section 147 of the state constitution merely deprives this court of the power to reverse on a mistake in jurisdiction made by either the circuit or the chancery court in retaining causes until final judgment or decree in the lower court.

According to the interpretation of that section by this court, if the chancery court shall hold jurisdiction of a cause purely legal and render final decree, such a mistake by a chancellor would not warrant the reversal of the decree by this court; and the same is true where a circuit court, through mistake or misapprehension of the law, holds a case of pure equity nature in the law court until final judgmnet.

In the case of Cazeneuve v. Currell, 70 Miss. 524, this court declares that while the law and equity courts are still distinct jurisdictions, yet the judges and chancellors of the state may, by mistake of law or equity, practically obliterate the demarcation between law and equity courts, merely by failing to observe the distinguishing lines between the jurisdictions of the two courts.

And it is further held in the same opinion, which was the first full construction of section 147 of the Mississippi Constitution, that the only inhibition of section 147 is against reversal by the supreme court on account of a mistake as therein specified touching jurisdiction, made by either the chancery or the circuit court.

In the case of Illinois, etc., R. Co. v. LeBlanc, 74 Miss. 650, the circuit court, a pure law court, actually entertained and tried the form of an action of ejectment, a proceeding in the nature of a quia timet proceeding, and yet this court declared that by reason of section 147 of the Mississippi Constitution, the judgment of the circuit court could not be reversed on the sole ground of want of jurisdiction of the law court. See also Adams v. Bank, 74 Miss. 307.

In the case at bar, the objection to the jurisdiction of the chancery court was made by demurrer properly and timely by the defendant, and the chancery court holding the demurrer to be well taken and sufficient, and that the demand was purely a legal one, declined to entertain or to assert jurisdiction over the cause, and dismissed the bill without prejudice to the complainant's right to a remedy at law.

This court in Carbolineum Co. v. Myer, 76 Miss. 568, expressly approved an action of this character on the part of a chancellor who was persuaded that the chancery court possessed no jurisdiction of the particular right sought to be enforced through its instrumentality.

The present case is one, not where the court entertained jurisdiction of the cause and entered a final decree which cannot be reversed by this court on the ground of a mere mistake in jurisdiction, as between common law and equity but it...