Dyson v. Washington Telephone Co. , 157 Ga. 67 ( 1923 )

Hines, J.

(After stating the foregoing facts.)

Should the demurrer have been sustained on the ground that the property sought to be recovered was realty for which an actioD of trover would not lie ? The suit is for the recovery of “certain telephone sets, open wire, cross-arms, brackets, anchors, transportation brackets, poles, telephone equipment, supplies, tools and instruments, switch-boards, and other property” of the plaintiff. None of these articles per se are realty. On the contrary they are, standing alone, personalty. But in the petition it is alleged that these articles are fully described in a list and inventory attached to the petition. The caption of this list and inventory is as follows: “Property of Oliver S. Dyson attached to plant of Washington Telephone Co., and claimed as his property.” If we construe this language to mean that all of this property is attached to the plant of the telephone company and is used in its operation, then we would have to decide whether, under the facts of this case, it is to be regarded as real estate, for the recovery of which the plaintiff cannot maintain this action. But this inventory shows that the plaintiff is seeking to recover “exchange supplies on hand,” which certainly are not attached to the soil and are not realty. If this be so, then the plaintiff, taking the most favorable view for the defendant, is suing to recover some property which has become realty because attached to the plant of the company, and to recover other property which is not so attached, which has not lost its character of personalty and can be recovered in an action of trover. While we cannot look beyond the four corners of a petition to determine whether it is subject to demurrer, we are fortified in our construction of the petition and its exhibit by the allegation of the defendant’s answer, that a. part of the property which the plaintiff seeks to recover is recoverable in an action of trover. So conceding to the defendant the most which it can claim, the petition was bad so far as it undertook to recover the property attached to the plant of the telephone company, but good so far as it sought to recover the personal property not so attached. A general demurrer goes to the whole pleading to which it is addressed, and should be overruled if any part thereof is good in substance. McLaren v. Steapp, 1 Ga. 376; Hazlehurst v. Savannah &c. R. Co., 43 Ga. 13; Finney v. Cachwallader, 55 Ga. 75; Lowe v. Burke, 79 Ga. 164 (3 S. E. 449); May v. Jones, 88 Ga. 308, 312 (14 S. E. 552, 15 L. R. A. 637, 30 Am. St. R. 154); Napier v. Union Cotton Mills, 93 Ga. 587 (20 S. E. 80). A bad part in pleading does not make the whole bad, but a good part makes the whole good enough to withstand a general demurrer. Munnerlyn v. Augusta Savings Bank, 88 Ga. 333, 339 (14 S. E. 554, 30 Am. St. R. 159). So it ¡becomes unnecessary to determine, in passing upon the demurrer, whether trover lies to recover all of the property embraced in the petition, and whether under the law and terms of the lease between the defendant and the plaintiff the personalty sued for retained its character as personal property although it may have been attached to, and made a part of, the company’s plant. 27 Am. & Eng. Enc. Law (2d ed.), 1024.

The defendant specially pleaded that all of the property sued for by the plaintiff is either connected with or attached to its plant, or is in its office or on its premises, and is actually used or is necessary for use in the operation of its plant, and that to permit the plaintiff to recover would disrupt the operation of its plant and prevent the company from discharging its duties to the public, for which reason the plaintiff had no right to maintain this action; and for this reason the defendant prayed that the petition be dismissed. Conceding that the plaintiff- cannot recover from the telephone company property attached to its plant and “which is absolutely essential to the complete performance of the public duties required of it,” on the ground that “the public is deeply and seriously interested” therein, a question which we will have to deal with later in this opinion, we have seen, in dealing with the demurrer to the petition, that this suit was not brought solely for the recovery of property so situated, but in part to recover property not attached to the plant and not actually used in the operation thereof, although such part of this property could be used in such operation. Eor this reason the proof to sustain this plea is not sufficient, and does not set up a good defense to the whole, if any, of the plaintiff’s action; and the action should not have been dismissed upon proof of such facts under said plea.

Subject to its demurrer and the above plea, the defendant filed an amendment to its answer, in which it sought to have an equitable accounting between it and the plaintiff, and to have all matters in dispute between them, growing out of their lease contract, adjudicated and settled, so as to prevent a multiplicity of suits. If either the demurrer or plea had been a good defense to the whole of plaintiff’s action, then the plaintiff’s action should have been dismissed, and with the dismissal of plaintiff’s petition would have gone the defendant’s plea and answer as amended; but we have seen that neither presented a defense in toto to the action. Eor this reason, the petition should not have been dismissed upon demurrer nor upon the proof submitted to sustain said plea. This being so, when' the defendant filed its equitable amendment to its answer, and asserted therein equitable rights and sought equitable remedies and relief, such amendment ipso facto converted the plaintiff’s common-law action of trover into a proceeding in equity, in which all the rights of the parties, legal and equitable, touching the subject-matter of this controversy, could be asserted. Oellrich v. Georgia Railroad, 73 Ga. 389; Dunson v. Lewis, 156 Ga. 692 (119 S. E. 846).

This brings us to consider the rulings of the trial judge upon the exceptions to the auditor’s findings. Did the court err in refusing to recommit the report of the auditor for the purpose of having him pass upon the question of plaintiff’s right to hire of the property sued for? In his petition plaintiff alleged that the hire of the property sued for was worth $1,000 per annum; but on the hearing before the auditor he introduced no evidence on this subject. Under such circumstances the plaintiff- will be treated as having abandoned his claim for hire; and the failure of the auditor to deal with this matter does not furnish proper cause for recommitting the report. Such omission is not a proper case for such recommittal. Civil Code (1910), § 5139. An auditor’s report will not be recommitted for the purpose of having the auditor report on a demand of a plaintiff in support of which he introduced no evidence. If the plaintiff wished to insist on this claim, he should have offered proof to sustain it during the hearing before the auditor, and caused the auditor to rule thereon. He cannot omit to do this, wait until the auditor has made his report, and then move to have the case recommitted for further hearing and report on such claim. He will be held to.have abandoned his claim, in the absence of any showing excusing his failure to press it before the auditor during the progress of the case. This makes it unnecessary for us to decide whether the plaintiff would be entitled to recover hire for the property sued for, under the facts of this case.

The plaintiff moved to strike the defendant’s answer, and to rule out all evidence introduced in proof of its allegations, on the ground that a claim for damages arising from a breach of contract cannot be allowed under a plea of recoupment in defense to an action of trover. The auditor overruled this motion, and to this ruling the plaintiff excepted. The trial judge overruled this exception, and error is assigned by plaintiff on his ruling. We think the rulings of the auditor and judge are correct. If the plaintiff’s action of trover had run its course to the end as an action at law, the plaintiff’s position would be sound. Under those circumstances damages, arising from the breach of the lease contract between plaintiff and defendant, could not be allowed under a plea of recoupment in defense of the trover action. Harden v. Lang, 110 Ga. 392 (36 S. E. 100); Bell v. Ober & Sons Co., 111 Ga. 668 (36 S. E. 904); Potts-Thompson Liquor Co. v. Capital City Tobacco Co., 137 Ga. 648 (74 S. E. 279). But the plaintiff’s action did not continue an action at law. By the equitable answer of the defendant it was changed into a proceeding in equity. The plaintiff sought to recover certain property consisting of additions and extensions made by him to the lines of the plant of the defendant while he operated the same under the lease contract. Under that contract plaintiff was to maintain and return the property to the defendant in as good condition as when he received it; and under that contract he had the right to construct or acquire lines connected with the plant of the defendant which would remain his property; but the telephone company under the lease contract had the right, at the expiration.thereof, to acquire from defendant all such lines upon payment to him in cash of the actual value of such lines. At the expiration of the lease the defendant took possession of the additions and extensions made by plaintiff to its plant, which it coiild not legally have done except under the provision in the lease authorizing it to acquire them on payment to plaintiff of the actual value thereof. By taking possession of this property with these additions and extensions at the expiration of the lease, the defendant will be deemed and held to have exercised its option to acquire it, and thus became bound to pay plaintiff the actual value thereof at the time of the expiration of the lease. The defendant further set up in its equitable answer that plaintiff had failed to maintain and return its plant in the condition in which it was when he received it, and that the defendant had been thereby damaged. It sought to recoup such damages against any claim which plaintiff might have to these additions and extensions. On the exercise by the defendant of its option to acquire this property, it became liable to plaintiff for the actual value thereof. Against this value the company claimed it could recoup any damages sustained by it because of the breach of said contract. In its amendment defendant further sought to have all matters of dispute arising between it and plaintiff settled in one suit in order to prevent a multiplicity of suits. It sought affirmative equitable relief. It was bound to give effect to all of.the equities of plaintiff. Under these circumstances, we do not see why the defendant could not recoup its damages growing out of plaintiff’s breach of said covenant, against the actual value of this property so taken and retained by the defendant upon expiration of the lease. The defendant made a proper case for equitable relief and recoupment. Beall v. Rust, 68 Ga. 774; Malsby v. Young, 104 Ga. 205 (2) (30 S. E. 854). In Hecht v. Snook &c. Co., 114 Ga. 921 (41 S. E. 74), this court said: “Before any statutes permitting set-offs were enacted in England, the court of chancery, following the equitable principles of the civil law, took jurisdiction in matters of set-off for the purpose of preventing circuity of actions.” So we are of the opinion that the auditor did right, under the facts of this case, in refusing to strike the defendant’s answer, and to rule out all evidence submitted thereunder; and that the trial judge did right in not sustaining plaintiff’s exception to the auditor’s ruling in this matter.

The contract by which the plaintiff leased from the defendant its telephone plant contains this provision: “Should said party of the second part [plaintiff] at any time during the period of this lease construct or acquire lines connected with said plant, such new lines so constructed and acquired by said party of the second part shall be and remain the property of said party on the expiration of this lease, but said party of the first part [the defendant] shall have the right at that time to acquire from said party of the second part . . all of such lines so constructed or acquired, upon the payment to him in cash such sum as would represent the actual value of such lines.” The meaning of the word “lines,” in this provision, became a matter of .acute dispute between the parties. The auditor found that “lines,” as so used, meant all additions and acquisitions to the plant, not used for maintaining or replacing, parts thereof, but for the purpose of enlarging and extending, the original system. To this finding the defendant excepted on the ground that “ Tines’ cannot be construed to mean ‘ all additions and acquisitions to the original telephone plant,’ for the reason that said contract refers to Tines connected with said plant/ that is already connected, and therefore could not have meant ‘additions and acquisitions’ thereafter connected with said plant; and for the further reason that the word Tine or lines’ in said contract should be construed to mean a telephone plant or plants, such as the Tignn.11 plant or Tignall line, which is the construction placed on said [word by the] legal authorities, and the only reasonable construction to place thereon under the terms of said contract.” The court sustained this exception of the defendant to the auditor’s finding, and the plaintiff excepts to this ruling. We think the trial judge put the wrong. construction upon the meaning of this provision. It does not embrace only independent lines constructed or acquired by plaintiff and connected with the plant. The contract embraced all lines constructed or acquired by plaintiff, whether dependent or independent. The provision embraces extensions of lines already built and new lines constructed or acquired by plaintiff and connected with the exchange of defendant, although not constructed or acquired as an independent system or part of such system. There is nothing in the contract to limit this provision to one class of lines. Such a construction would be unreasonable. There is no good reason why the plaintiff should not be paid for a new line erected by him on a street in Washington to supply telephone services to dwellers thereon .and to be used as a part of the system of the company leased by him. Nor is there valid reason for holding that he should not be paid for the extension of the lines of the company into unoccupied territory for the same purpose. It would be inequitable and unjust to allow the telephone company to retain such additions or extensions erected by defendant at big expense, without paying for the same. Such additions and extensions were evidently within the contemplation of the parties at the time the lease contract was entered into. So we think that the auditor found right in this matter, and that the trial judge erred in sustaining the defendant’s exception to the auditor’s finding.

Two questions, which are strongly and ably stressed in the briefs of counsel, one whether extensions and additions to the lines of the telephone company, constructed or acquired by the plaintiff and connected with the company’s plant, were realty for the recovery of which trover will not lie, and the other whether trover will lie to recover such extensions and additions when they are being operated by the defendant as part of its plant in performing its public duties, need not be decided under the view we take of this case. These questions would have arisen, and would have to be decided, if the trover suit had not been changed by the defendant’s equitable amendment into a proceeding in equity. By this metamorphosis the action of trover was converted into a suit in equity. By this final turn the action became an equitable one for the full and complete determination of all the rights of the parties under the lease contract. The "true right and equity of the plaintiff was to have payment for these extensions and additions at their actual value at the time of the expiration of the lease, and not to recover them or damages for their conversion. The true right and equity of the defendant was to recoup against this value the damages sustained by it by the plaintiff’s breach of his covenant to maintain and return the plant in the condition in which he received it. The trover action survived as the peg on which was hung the defendant’s equitable answer in the nature of a cross-action. In this view of the case we do not think that it is now necessary to decide these questions. The proper disposition of the ease does not depend upon their decision. Such disposition rests upon the determination of the equitable rights of the parties. So it becomes unnecessary to consider, as to these questions, the rulings of the auditor, the exceptions of the defendant to such rulings, and the judgment of the trial judge on these exceptions.

The trial judge erred in sustaining the defendant’s exceptions of law. He should have held that the decision of the exceptions to the findings dealt with in the last division of this opinion was unnecessary, and that all othe.r rulings to which the defendant excepted were correct. The trial judge likewise erred in sustaining the demurrer to the plaintiff’s petition, in dismissing the same, and in taxing all the costs against the plaintiff.

Judgment reversed.

All the Justices concur.