Seaboard Air Line Railroad v. Atlantic Coast Line Railroad , 237 N.C. 88 ( 1953 )

74 S.E.2d 430 (1953) 237 N.C. 88

SEABOARD AIR LINE R. CO.
v.
ATLANTIC COAST LINE R. CO. et al.

No. 607.

Supreme Court of North Carolina.

January 30, 1953.

James B. McDonough, Jr., Norfolk, Va., Varser, McIntyre & Henry, Lumberton, for plaintiff appellee.

M. V. Barnhill, Jr., Wilmington, F. S. Spruill, Rocky Mount, for defendant, appellant.

DEVIN, Chief Justice.

When considered alone the facts set forth in the plaintiff's complaint might be regarded as sufficient to invoke the aid of equity to prevent injustice and to forestall advantage being taken by one of two equal owners in the operation of the essential railroad facilities of the defendant Bridge Company, but as equity follows the law we think the final determination of the matters complained of should abide the plenary presentation of both sides of the controverted questions rather than that the court should attempt to decide the issues by a ruling on a preliminary injunction. The time for answering has not expired and neither defendant has answered.

In the field of equity jurisprudence one of the functions of the court is to interpose its power to prevent undue advantage being taken during litigation, and to maintain the status quo until all the essential facts can be properly determined and final judgment rendered. Hence we think the judgment of the court below in some respects goes beyond the scope of equitable jurisdiction and in effect tends to alter the position of the parties in relation to the litigation before all the pleadings have been filed.

Whether the plaintiff shall be permitted over the objection of the defendants to make physical connection with the Bridge Company's track and right of way in order to reach its spur track leading to the power plant is the ultimate question to be determined. The defendants challenge the power of the court to issue a mandatory injunction which would determine the matter at this stage of the litigation.

The judgment appealed from is in the form of a restraining order or prohibitory injunction, but its effect is in some respects mandatory in that it requires the defendants to permit the plaintiff to make physical connection with the Bridge Company's tracks. The order restrains the defendants (1) from interfering with the construction by plaintiff of the turnout from the Bridge Company's main line at the point indicated; (2) from interfering with plaintiff's use of the telephone block system; (3) from interfering with plaintiff's use of the Bridge Company's tracks and right of way to reach and use the turnout, and defendants are required forthwith to permit the plaintiff to operate over the trackage of the Bridge Company in order to reach, construct, use and maintain the said turnout and the trackage constructed by plaintiff to connect therewith.

A temporary restraining order based on the verified allegations of the complaint may be issued at the time of the institution of a suit for the purpose of preventing the commission or continuance of some act which during the litigation would produce injury to the plaintiff or tend to render judgment in his favor ineffectual. G.S. § 1-485. It is an ancillary remedy afforded by the courts of equity and authorized by statute for the purpose of preserving the status quo pending the action. Board of Managers of James Walker Memorial Hospital v. Wilmington, 235 N.C. 597, 70 S.E.2d 833; Kinston Tobacco Board of Trade v. Liggett & Meyers Tobacco Co., 235 N.C. 737, 71 S.E.2d 21; Arey v. Lemons, 232 N.C. 531, 61 S.E.2d 596; Jackson v. Jernigan, 216 N.C. 401, 5 S.E.2d 143; Cobb v. Clegg, 137 N.C. 153, 49 S.E. 80. It will issue to prevent an injury being committed or seriously threatened. Wilcher v. Sharpe, 236 N.C. 308, 72 S.E.2d 662. In addition, a mandatory injunction may be issued to restore the status wrongfully disturbed. Keys v. Alligood, 178 N.C. 16, 100 S.E. 113; Clinton-Dunn Telephone Co. v. Carolina Telephone & Tel. Co., 159 N.C. 9, 74 S.E. 636. In the last case cited preliminary injunction issued requiring restoration of a severed telephone connection. "It (a court of equity) may, by its mandate, compel the undoing of those acts that have been illegally done, as well as it may, by its prohibitive powers, restrain the doing of illegal acts." 28 A.J. 211. The court may compel the restoration to the plaintiff of that which was wrongfully taken from him. Lovett v. West Virginia Cent. Gas Co., 65 W.Va. 739, 748, 65 S.E. 196, 24 L.R.A.,N.S., 230. A mandatory injunction based on sufficient allegations of wrongful invasion of an apparent right may be issued to restore the original situation. Joyce on Injunctions, sec. 102. But a preliminary mandatory injunction on ex parte application should not be granted, except in case of apparent necessity for the purpose of restoring the status quo pending the litigation. 43 C.J.S., Injunctions, § 5, p. 412; Warner Bros. Pictures v. Gittone, 3 Cir., 110 F.2d 292; Town of Leesville v. Kapotsky, 168 La. 342, 122 So. 59.

In Leaksville Woolen Mills v. Spray Power & Land Co., 183 N.C. 511, 112 S.E. 24, 25, the plaintiff's right of way into its premises was obstructed. The issuance of a preliminary mandatory injunction was affirmed. From the opinion of Justice Adams, written for the Court in that case, we quote: "When it appears with reasonable certainty that the complainant is entitled to relief, the court will ordinarily issue the preliminary mandatory injunction for the protection of easements and proprietary rights. In such case it is not necessary to await the final hearing. If the asserted right is clear and its violation palpable, and the complainant has not slept on his rights, the writ will generally be issued without exclusive regard to the final determination of the merits, and the defendant compelled to undo what he has done." Elder v. Barnes, 219 N.C. 411, 14 S.E.2d 249; Davis v. Alexander, 202 N.C. 130, 136, 162 S.E. 372; Keys v. Alligood, 178 N.C. 16, 100 S.E. 113. "As a rule such an order will not be made as a preliminary injunction, except where the injury is immediate, pressing, irreparable, and clearly established. * * * As a final decree in the case it would be issued as a writ to compel compliance in the nature of execution." McIntosh, sec. 851; Clinard v. Lambeth, 234 N.C. 410, 67 S.E.2d 452. In First Nat. Bank v. People's Bank, 194 N.C. 720, 140 S.E. 705, a mandatory injunction to carry into effect the final judgment on the merits was affirmed.

"The grant of a preliminary mandatory injunction is, of course, within the prerogative jurisdiction of courts of equity. The injunction is generally framed so as to restrain the defendant from permitting his previous act to operate, or to restore conditions that existed before the wrong complained of was committed." Anderson v. Waynesville, 203 N.C. 37, 46, 164 S.E. 583, 588. Such preliminary injunctions are issued to preserve the status quo until upon final hearing the court may grant full relief, and are usually issued in cases where the defendant has proceeded knowingly in breach of contract or in wilful disregard of an order of court. Anderson v. Waynesville, supra; Keys v. Alligood, supra.

The position of the plaintiff Seaboard is that under the facts alleged the Bridge Company is an inactive or passive trustee holding the legal title to the property for the joint benefit of the Seaboard and the Coast Line, and that, pursuant to agreement between the two, the Coast Line maintains and controls the property and operations over it for the benefit of each, with result that in law and equity a fiduciary relationship is imposed upon the Coast Line with respect to its co-owner and joint beneficiary. The plaintiff maintains that the Coast Line becomes the active trustee and as such should not be permitted to derive pecuniary benefit from its position, and should not be permitted to exclude the Seaboard from an opportunity to share in the profitable use of the jointly owned facilities. And further, it is contended that the Bridge Company as holder of legal title to the property in trust should be required to permit the equal use of its facilities by both beneficiaries. In support of this view the plaintiff cites Chicago, M. & St. P. R. Co. v. Des Moines Union R. Co., 254 U.S. 196, 41 S. Ct. 81, 65 L. Ed. 219, and Chicago, M. & St. P. R. Co. v. Minneapolis C. & C. Ass'n, 247 U.S. 490, 38 S. Ct. 553, 62 L. Ed. 1229.

If it be conceded, arguendo, that the circumstances here when fully developed may be such as to show a fiduciary relationship between the parties and to impose upon the defendants an obligation which would require consent to a reasonable request by one beneficiary with respect to the use of jointly controlled property, yet that question cannot properly be determined until all the parties have had opportunity to be heard.

It does not appear from the complaint that the defendants have committed any wrongful act injurious to the plaintiff's rights or property such as would justify the exercise of the power of a court of equity to remedy by mandatory injunction, or to require the restoration of a status formerly existing.

The gravamen of the plaintiff's complaint is that the defendants have refused to permit the plaintiff to make physical connection with the tracks of the Bridge Company so as to enable the plaintiff to use a spur track therefrom to serve a shipper. The position of the defendants is passive. They have merely refused to comply with plaintiff's request. Apparently the action is not to restore what has been unlawfully changed, but to create a new condition not theretofore existing; not to prevent a wrong but to obtain opportunity to exercise a right; not to prevent a disruption of existing service, but to create a new service.

Hence we think the order of the court below went beyond the scope of a temporary restraining order and in effect required the defendants to permit the Seaboard to enter upon the right of way and tracks of the Bridge Company for the purpose of constructing a turnout. This would determine by an interlocutory order the ultimate relief sought in this action in accordance with the prayer in plaintiff's complaint. Moss Industries, Inc. v. Irving Metals Co., Inc., 140 N.J.Eq. 484, 55 A.2d 30; Kinston Tobacco Board of Trade v. Liggett & Meyers Tobacco Co., supra.

Reference was made in the complaint to a provision in the 1909 agreement between the operating railroad companies that questions and disputes between the parties should be submitted to arbitration, but as no request for arbitration had been filed the matter was not considered by the court below, and is not before us now.

It was stated in the briefs that it had been informally stipulated that the Bridge Company need not file any pleading in this case, but the Bridge Company is the legal owner of the property involved, and as such is a necessary party, and we think should answer.

For the reasons hereinbefore set out we conclude that the mandatory provisions of the restraining order were improvidently entered and the cause is remanded for trial on the issues raised by the pleadings.

Error.