Marble Company v. Ripley

[Syllabus from pages 339-341 intentionally omitted]

THESE were appeals from the Circuit Court for the District of Vermont, in two decrees, one of them on a bill filed by the Rutland Marble Company against a certain Ripley and one Barnes, and the other one a cross-bill filed by the same Ripley against the company just named. The case was this:

On the 22d of January, 1850, the said Ripley and the said Barnes together owned a tract of land in Rutland township, Vermont, containing about twenty-one acres, in which was a valuable marble quarry. On that day Ripley, by his deed, released and quit-claimed unto his co-tenant, Barnes, in fee simple, the tract of land. The deed contained a reservation to the releasor, his heirs, executors, administrators, and assigns, of 'the right to enter upon and take possession of the said twenty-one acres, for the purpose of digging, quarlying, and carrying away all the marble he or they might want, according to the stipulations and conditions of a contract that day made and concluded between the said Ripley and Barnes, in case the said Barnes, his heirs, executors, administrators, and assigns, should refuse, or fail on their part to fulfil the conditions and stipulations of the said contract.' By the contract referred to, which was made on the same day, Barnes agreed, 'for himself, his heirs, executors, administrators, and assigns, to quarry marble from the marble quarry, and draw and deliver at the mill of the said Ripley, in Rutland, from the layers of marble usually denominated the white layers in said quarry, all the marble that the said Ripley might want to saw, manufacture, and sell, in good sound blocks, of suitable size, shape, and proportion, and to quarry to order as might be wanted to keep the mill fully supplied at all times, the amount to be not less than 75,000 feet per annum, and for so long a time as the said Ripley, his heirs, executors, administrators, and assigns might want.' It was also agreed that should Ripley, his heirs, &c., at any future time desire to increase the business, Barnes, his heirs, executors, administrators, and assigns, should furnish the blocks, as aforesaid, to the extent of 150,000 feet per annum of two-inch marble slabs, on receiving one year's notice to that effect. It was also agreed that Ripley, his heirs, &c., or his or their agents, might have the privilege of dividing each lot of blocks, as taken and drawn from the quarry, taking an average share as to quality, size, and shape, before any blocks should be taken from the lots by any other person, the first choice always being taken by Ripley, or for his mill. It was also stipulated that Ripley might abandon the contract at any time on giving one year's notice. The contract further stipulated that if Barnes, his heirs, executors, administrators, or assigns should fail or refuse to fulfil its conditions, Ripley, his heirs, executors, administrators, or assigns, or his or their agents, might enter upon the quarry and the premises attached to, and connected with it, and might quarry and dig, take and carry away, as much marble as they might want; and might have the use of, and enjoy all the rights, privileges, and appurtenances belonging to, or connected with, the said quarry, without hindrance or obstruction, or in any way paying for the same, and might keep possession until Barnes, his heirs, executors, administrators, or assigns, should be ready and willing to fulfil the conditions of the contract on their part; it being also provided that if, after making an entry as aforesaid, Ripley, or his heirs, &c., should make an opening, or put the quarry in a better condition for getting out marble, Barnes, his heirs, executors, administrators, or assigns should not re-enter, or resume possession, until Ripley, his heirs, &c., should have had the benefit of the work done and money expended by them, unless Barnes should make payment for the same. It was further provided that Ripley, his heirs, executors, administrators, and assigns should receive the marble blocks so delivered at the mill; should saw, trim, and prepare them for market; should sell them, advancing from time to time to Barnes, as the blocks should be delivered, twelve cents per foot of two-inch marble, as payment for drawing and quarrying, and retaining from the proceeds of sales of the marble an equal sum per foot, as payment for sawing and trimming, retaining also from the proceeds of sales the expenses of transportation to market, and all the necessary expenses of doing the business and collecting payment for the marble (not including payment for his own time and labor), and should divide the remainder of the proceeds of sale equally between Barnes and himself, as collected. Ripley further agreed to pay Barnes one cent per foot of two-inch marble for drawing and transporting the marble from the quarry to the mill, the payment to be made from his own funds. At the date of this contract the quarry had been opened at the north end only, though Barnes contemplated making an opening on the south end, for two persons named Allen and Adams. The contract contained accordingly still another provision, evidently an alternative; to wit, that if the marble contained in that part of the ledge which Barnes was about to open for Allen and Adams should prove to be of better quality than the marble from the quarry then opened and worked upon the land, Barnes should open on the south end of the lot conveyed to him, and furnish Ripley with marble from that place on receiving reasonable notice.

Barnes having thus become the owner in severalty of the land containing the quarry, conveyed it, on the 1st of June, 1854, to sundry persons, expressly excepting the right reserved by Ripley in his deed aforesaid, and reserving to himself a right of entry in case his grantees should fail to perform his contract with Ripley. By several mesne conveyances the property became vested in the Rutland Marble Company on the 31st of October, 1863. In all the deeds, including that to the company, the right of entry reserved by Ripley in his conveyance to Barnes, and his rights under the contract, were expressly excepted, and the grantors reserved also a right of entry on the failure of their grantees to comply with the engagements of the contract of January 22d, 1850.

Soon after the contract was made, Ripley gave notice that he required his supply of marble under it to be increased from 75,000 to 150,000 feet, and on the 24th of July, 1854, he gave notice that he wanted the whole of his marble quarried from the south end of the ledge, next to the opening of Allen and Adams, according to the contract. On the 22d of August, 1855, he again gave notice that he claimed, under his contract of January 22d, 1850, to be forever thereafter supplied with marble from a proper opening of the ledge for the purpose, on the south end of the lot conveyed by his deed to Barnes. Accordingly an opening was made at the south end, necessarily at considerable expense, and he was supplied therefrom for years, until the spring of 1864, and until differences arose which resulted in these suits. Until that opening was made in 1854, or 1855, there was none on the land except the one which had been made at the north end before the contract between Barnes and Ripley was signed.

In the year 1854, while Barnes was still the owner of the land, a modification of the contract was agreed upon between him and Ripley, the particulars of which it is not necessary here to notice. The modification expired by its own limitation on the 1st of February, 1864, leaving the original agreement in full force. As already said, the marble company had, prior to that time, become the owners of the property; and they had fulfilled, so far as it appeared, the requirements of the modified contract. But very soon after its expiration, if not before, differences arose between them and Ripley respecting their rights under the agreement. On the 15th of February, 1864, he gave them notice that he claimed a right to divide every lot of blocks at all times thereafter, when taken from the quarry, insisting on a right to a first choice; and when this demand was resisted by the marble company it was renewed by Ripley. Differences also arose between the parties respecting Ripley's obligation under the terms of the contract, calling for 'layers of marble usually denominated the white layers,' to receive certain kinds of marble called brocadilla, having in a basis essentially white considerable deposits of blue or green; differences also respecting his right to demand payment for unloading at his mill, and respecting his obligation to pay for quarrying and hauling.

In this state of things, on the 5th of April, or within a day or two after it, a strike took place among the workmen at the quarries. On its occurring Ripley advised the company to hold out, saying 'that he would aid in whatever way he could; that the workmen had had their way long enough; that the company ought to resist the thing now, and ought to have done it years before.' When replied to by the agent of the company that the difficulty to resistance was in the contract with him about the mill, he said 'that the strikes affected his men and all the men at the mills, and that he would rather wait six months, or even twelve, and have the company get possession of the quarry and manage it as it ought to be managed.' Evidence, however, showed that it was observed about the 13th or 16th of April, that Ripley himself was having drills made of the sort used in quarrying, and that he kept persons in ignorance of the purpose for which he meant to use them, and that when told by an agent of the company whom he had advised to hold out against the strike, 'that the men understood that he was going to set them to work, and that he was thus helping the strike along as much as any one;' his reply was 'that they did not know but that he was going to quarry somewhere else; that they did not know where he was making drills to be used.' Whether the company had furnished to Ripley all the marble that he had a right to demand, under the contract of January 22d, 1850, was one of the matters in controversy. His mills had been enlarged after the date of that contract, so that they could saw 300,000 feet; and so enlarged, were perhaps not fully supplied at all times. It appeared, however, by the testimony of Ripley himself, and by his cross-bill, that between the 1st of February, 1864, when the already-mentioned modification of the contract expired, and the 3d of April (about which time the strike began), the marble company had delivered at Ripley's mill about 26,687 feet of marble. Ripley, it appeared, was in arrears at this time with his payments; and quarrying in the winter, it was proved, is a sort of work which in a latitude so high as that of Vermont, where frost necessarily pervades a quarry, is performed with injury to the quarry worked on.

On the 26th of April, soon after the strike was complete, Ripley, without giving any notice of his intended action, caused an entry to be made upon the entire property, as well the southern opening as the northern. The entry was made about three o'clock in the morning, by Barnes, acting for Ripley, and a large number of men were set at work, to the exclusion of the marble company.

The company hereupon filed a bill in the court below, setting forth various alleged pretensions of Ripley, which it said were unfounded; the strike and his complicity with the workmen; that his mill was always sufficiently supplied, & c.; and praying

That Barnes and Ripley might be enjoined against further unlawful interference with, or occupation of the then, the complainants' said property:

That the contract might be decreed rescinded and terminated, or, if not, that various questions respecting its construction might be settled by the decree of the court, and that the defendant, Ripley, might be required to account for the money of the complainants in his hands.

To this bill answers were put in by the defendants, and a cross-bill was filed by Ripley. The answer of Ripley, more material than Barnes's, after a general history of things, denied most of the important allegations of the bill. It admitted, however, the strike, as stated in it, and after saying that the had expressed the opinion that the company should at once have refused all further employment of the laborers when the men struck, and have employed a new set of men, which he believed might have been done long before April 26th (the date of his entry), he proceeded to answer that the company totally disregarded his said opinions, and wholly neglected, so far as he could learn, to make any arrangement to substitute new laborers or to renew the business of quarrying, and being reliably informed and believing that no arrangement would ever be made with the laborers for their return to work, and the use and possession of the quarries having been to all appearance entirely vacated from the time of the strike (which was April 5th or 6th), he entered.

The cross-bill, after setting forth the same sort of a general history, and an account of the disputes that had arisen, &c., went on to represent that the marble company were working the quarries to an enormous excess over and above the quantity authorized or required by the contract of 1850, or any reasonable or proper expectation of the parties under the same, and were supplying other parties, and the trade in general, with great quantities of marble taken from the quarries, in violation of the rights of Ripley; that the whole mass and quantity of marble of the kind and description mentioned in the contract contained on the land, was limited and not inexhaustible, and that a continuance by the company in their then present rate of exhaustion and supply of the general market therefrom, would in a short time so exhaust the quarry as to render the performance of the contract of 1850 impossible, whereby he, the defendant, Ripley, would be entirely deprived of his beneficial interest in the quarry arising under the contract, and the whole profit and advantages thereof would be absorbed and exhausted by the company. The cross-bill prayed accordingly that the company might be decreed to perform specifically the contract by furnishing the marble as therein required, or deliver up the possession of the quarry and property to the said cross-complainant, free and discharged from all claim, right, or title which the said company ever had, or then had, in and to the same; and that in the meantime they be restrained from operating or working the quarry, or selling any marble taken therefrom; that they be decreed to pay such damages as the complainant might have sustained in consequence of their not having supplied his mill with marble as required by the contracts of 1850 and 1854, and pay the same by a specified day, and that the quarry be held as security therefor, and in default of such payment the company should be foreclosed of all equity of redemption or claim in and to said quarry and property.

The answer to the cross-bill, denying many other allegations, denied upon belief, that the quarry was likely to be exhausted, at least within a century, by any amount of work within the power of the company to give, or justified by their interests, and it insisted that the contract did not secure to Ripley the exclusive product of the quarry, but that the company had a right to work it for their own benefit independently of the arrangement; and admitting that they were taking from the quarry, and were disposing of more marble than was required to supply Ripley under the contract.

The grounds upon which the marble company rested their prayer that the contract might be rescinded and cancelled were, that Ripley had not performed the duties which it imposed upon him; that though it was, when made, intended to operate for the equal benefit of both parties, it had become, in the lapse of time, with the increased demand for marble, the greatly enhanced cost of production, and the entire change in the character and results of the marble business, grossly unfair and unequal; so much so, indeed, that the defendant's net receipts under it had become more than twelve times as much as those of the complainants; to him, yielding a yearly revenue of $40,000; to them, resulting in a very great loss on the marble supplied, and a return barely sufficient to defray the expenses of executing the contract; an inequality which they alleged was not denied, and was plainly unconscionable; that in addition to this, the contract made the company partners with Ripley, or his successors, in title to the mill, whether they would or not; and that, if corporations could not enter into partnership, they could not purchase the lands subject to the obligation of becoming partners, and therefore that the contract restrained the alienability of the property.

One of the grounds on which Ripley rested his claim to a decree for specific performance of the contract was a notice from the marble company, given to him on the 18th of June, 1864, that they would maintain that the facts set forth in their bill amounted to a permanent breach and violation on his part of the contract, authorizing them to treat it as rescinded, and that they therefore rescinded it, asserting that they had always performed it on their part until it was thus violated and broken by him.

The Circuit Court, after a hearing, granted an injunction in accordance with the prayer of the Rutland Marble Company, restraining the defendants, Ripley and Barnes, from the further occupation or possession of the premises and property described in the bill, and from any interference therewith, and enjoining them against hindering or disturbing the complainants from takine possession of, occupying, and using the same until the further order of the court. But the court refused to decree a rescission and cancellation of the contract itself.

The court also, in effect, decreed a specific performance of the contract, as prayed in the cross-bill, and made several decretal orders respecting the manner in which the contract should be performed, but the injunction asked for in the cross-bill was denied.

Among the decretal orders was one, that Ripley should pay over monthly to the company its share of the money received by him from the marble business; and there was none, as he by this cross-bill had prayed for, that the court would enjoin the company from selling and disposing of marble taken from the quarry. From the decrees above mentioned, and the decretal orders, appeals were taken to this court; Ripley, in his appeal, specifying as a second ground for it, the manner in which, as above stated, he was required to account with the company; and as a sixth ground,'The omission and refusal of the court to enjoin the company from selling or disposing of marble taken from the quarry.'

The matters considered by the court, accordingly, were:

I. Upon the bill by the marble company.

1. Whether the case was one for the injunction prayed for by the company against Ripley and Barnes.

2. Whether the case was one for the cancellation of the contract of January 22d, 1850.

II. Upon the cross-bill by Ripley.

1. Whether, it being decided that the contract was not to be cancelled, Ripley was entitled to a decree for specific performance of it by the company.

2. Whether the decretal orders above quoted and objected to by Ripley were erroneous.

The case, of which the transcript filled 904 printed pages, was elaborately argued by Messrs. B. R. Curtis and E. J. Phelps, for the Rutland Marble Company; and by Messrs. George F. Edmunds and W. M. Evarts, contra.

Mr. Justice STRONG, having stated the case, delivered the opinion of the court.