State Hospital for Criminal Insane v. Consolidated Water Supply Co. ( 1920 )

Opinion by

Mr. Justice Moschizisker,

The State Hospital for the Criminal Insane, located in Wayne County, Pennsylvania, filed a bill in equity complaining that, on September 8, 1917, the Consolidated Water Supply Company, defendant, had unlawfully opened a dam and allowed the water to escape from a certain reservoir, owned and used by plaintiff for institutional purposes; the bill prayed for an injunction and damages. Defendant filed a cross bill, and all matters sought to be put at issue were duly brought to trial. The original bill was sustained, cross bill dismissed, and the hospital awarded relief as prayed for; the water company has appealed.

The ultimate and controlling issue raised by the pleadings concerns the ownership of the water contained in what shall be hereinafter referred to as “Reservoir 7,” both parties claiming through a common grantor. The identical point — as to ownership — was directly at issue in a prior suit at law between the same parties, concerning the same subject-matter, wherein a final judgment was rendered in favor of the present plaintiff by the Superior Court (see Consolidated Water Supply Co. v. State Hospital, etc., 66 Pa. Superior Ct. 610, 623), that tribunal stating, inter alia: “It is evident from a consideration of all the facts that the grantor did not intend by its conveyance to the water company to lease the right to use the water from the reservoir [7] now owned by the [hospital].”

The matter just quoted is the final governing conclusion, after an extended consideration by the Superior Court of a case-stated, embracing all the material facts now before us; but the court below, instead of sustaining plaintiff’s contention that the legal right to the water in controversy had been already determined at law, and, hence, all required of it was to prove defendant’s invasion of that right and the damages suffered thereby, entered upon an elaborate trial of the same issues as those adjudicated in the former action, together with certain other attending issues of fact, which were relevant to, and might have been included in, the case-stated. This procedure resulted, however, in the conclusion that, “at the time of the acts complained of, the hospital was, and has since continued to be, and now is, the absolute owner of Reservoir 7 and the waters ponded therein”; which for all material purposes is exactly similar to the decision reached in the prior suit.

The facts brought forth on both suits, essential to an understanding of our present consideration, are these: Prior to 1867, the Delaware & Hudson Company owned the entire acreage over which a stream called Racket brook flowed, and, at that time, when no other riparian rights were involved, it built the dam which formed Reservoir 7, as well as creating two additional water basins, by other dams, at different locations on its lands. November 1, 1867, the company executed a long-term lease to a predecessor in title of the present defendant, for one of these reservoirs other than 7; but this lease — . as properly found by the court below — =did not give to the lessee all the water of Racket brook — it simply conferred “the right to take water from said brook for supplying said reservoir” (that leased to defendant’s predecessor), which, we may remark incidentally, is located lower down the stream than No. 7. The lessor continued to use Reservoir 7 for its exclusive purposes to the year 1910; but, in 1912, it deeded 50 acres, “upon which was and is located the entire dam” of that receptacle, to the Commonwealth of Pennsylvania, this land adjoining 613 other acres (on which plaintiff’s institution is erected) acquired by the Commonwealth from the same grantor in 1907. The 1912 deed also conveyed “all the right, title and privilege” of the grantor to maintain the water supply here in controversy, the grant in that respect being identified as “all the rights reserved” in a previous deed of the Delaware & Hudson Company to “Francis Walcott,” i. e., the unrestricted right to maintain Reservoir 7, “flowage on said lands, enjoyment in use of the water therein, and access to and from same”; but the deed reserves to the grantor the right to use the contents of this reservoir, and likewise excepts such rights in the premises, “if any,” as the grantor “leased, November 1,1867,” to defendant’s predecessor in title.

On these facts, and others which we deem it unnecessary to detail in this opinion, the court below concluded, as hereinbefore stated, that plaintiff had an absolute right to all the water in Reservoir 7, saying in substance that all such water was being used strictly for institutional purposes, and that there had been no departure by plaintiff “from compliance with the rule for the return of surplus water, if any, to the original channel” of the stream; further, that plaintiff’s rights were subject only to those of its grantor, as reserved in the last mentioned deed, and defendant’s claim that it had acquired prescriptive ownership in the waters of Racket brook and Reservoir 7 was “not supported by evidence,” any use it had made thereof being “permissive only.” Finally, concerning the reservation in the 1912 deed of such rights, “if any,” as the grantor had previously “leased” to defendant’s predecessor in title, the court below properly found “it did not lease the right to use the water from Reservoir 7”; which is all that need here be said upon this point.

Defendant introduced evidence as to its acquirement of certain rights in Racket brook, which had been appropriated by three other corporations. It is not necessary, in this connection, to decide whether or not plaintiff’s supply could be taken for other public purposes (see (discussion on private water supplies in the opinion of President Judge Rice, Gring v. Sinking Spring Water Co., 7 Pa. Superior Ct. 63), since we are not convinced the court below erred in finding that no proper condemnation of the water in controversy had been shown, or in holding that, for this reason, the evidence in relation to the alleged appropriations thereof was immaterial. We also agree that the facts found, at the request of defendant, as to the water taken from Reservoir 7 being needed by that company to fulfill its corporate purposes, are immaterial, since no legal title thereto was shown.

We shall not further examine the matters of law or fact involved in the determination of the title to the water in controversy; for, as previously said, all the issues which enter into the determination of that governing point (Allen v. Int. Textbook Co., 201 Pa. 579, 582; Kilheffer v. Herr, 17 S. & R. 319, et seq.) were adjudicated in the previous action at law, except the two matters referred to in the immediately preceding paragraph, both of which were appropriate to, and, if defendant desired them passed upon, should have been incorporated in the case-stated then brought into court. Moreover, as noted in the last mentioned paragraph, and found by the court below, the two new, and subordinate, issues, — on the point of title to the water — raised in the present case, when examined, prove to be of no moment.

The fact that the previous action was in form a case-stated, makes no difference so far as the question of res adjudicata is concerned; the formal judicial determination of a governing point at issue in a case-stated is conclusive between the parties. In Wheeling, etc., Co.’s App., 1 Penny. 360, 363, we held that a case-stated, being in the nature of a special verdict, is “a judicial ascertainment of facts,” which, after affirmance of a judgment thereon, is conclusive between the parties to the suit, on the doctrine of “interest reipublicaa ut sit finis litium.” This is equally true of all relevant facts and issues directly connected with the subject-matter of a litigation which might properly have been offered in the prior suit (Kilheffer v. Herr, 17 S. & E. 319, 320): but only such facts and issues, embraced in the case-stated, as have been acted upon, in the sense that they may be said to be “judicially ascertained” or determined, can be held res ad judicata in a subsequent litigation between the same parties, over the same subject-matter — which is the case at bar, in so far as the title to the water of Eeservoir 7 is concerned. For a discussion of relevant governing general principles see Morrett v. Fire Association of Phila., 265 Pa. 9, 12, 13.

The purpose underlying res ad judicata is more than to serve simply the interest of one who may see fit to invoke the rule; it is a measure of public policy, based on the principle that the general welfare requires litigation not to be interminable: Mayor et al. of City of Paterson v. Baker, 51 N. J. Eq. 39, 59; Walsh’s Est., 80 N. J. Eq. 565, 570. The courts, for the economy of time belonging in common to all litigants, will not consider a point which has already been adjudicated between the same parties (Wheeling, etc., Co.’s App., 1 Penny. 360, 363; 15 R. C. L. 951; McMichael v. Horay, 90 N. J. L. 112, 115; Ludwick v. Penny, 158 N. C. 101, 110; Womach v. City of St. Joseph, 201 Mo. 467, 476, et seq.) ; and the circumstance that the first suit was at law and the next in equity is not material in the application of this rule: Kilheffer v. Herr, 17 S. & R. 319, 320; Megahey v. Farmer’s, etc., Assn., 215 Pa. 351, 352; Browarsky’s Est., 252 Pa. 35, 11; Schmidt’s Est., 185 Pa. 579, 585; Shively v. Mining Co., 5 Cal. App. 236, 212; Trust Co. v. Doman, 93 N. W. 1022, 1021. “Public policy and the interest of litigants alike require that there be an end to litigation, and the peace and order of society demand that matters distinctly put in issue and determined by a court of competent jurisdiction as to parties and subject-matter, shall not be retried between the same parties in any subsequent suit in any court. The doctrine of res adjudicata not only puts an end to strife, but produces certainty as to individual rights and gives dignity and respect to judicial proceedings”: 15 R. C. L. 954-5.

That appellee did not except to the chancellor’s refusal of its res adjudicata contention, is of no importance here. If the facts found by a chancellor show that a controlling point in the case had been judicially determined in previous litigation, under such circumstances as to make that particular point or issue res adjudicata, where the court below, although refusing a plea to this effect, nevertheless decides the point involved, on the merits, and enters final judgment thereon in favor of the party who contended for the conclusiveness of the former adjudication, there is no rule or principle which debars the appellee, on an appeal by his antagonist, from successfully suggesting to the appellate court that, in addition to the reasons given by the court below for its final judgment, such judgment is also sustainable on the ground of res adjudicata.

Even in the days of special pleading, one was not always required specially to plead res adjudicata. In Kilheffer v. Herr, 17 S. & R. 319, 322, where, as here, plaintiff relied upon the former adjudication of a controlling fact, contending (again as here) he ought to be obliged only to prove his damages, we said, in sustaining this position: “It is difficult to assign a reason why the [prior] judgment should not have the same conclusive operation, if given in evidence, without pleading, as it would be admitted to have, if pleaded in bar.”

Equity Rule 67, in terms, simply requires an exception taken to all matters which an appellant desires to assign as error; it goes no further. In a case almost exactly like the present one — so- far as it relates to the failure of appellee to take an exception in the court below — the plea of res adjuclicata was sustained to affirm a decree in equity (Brady v. Parish of Ascension, 26 La. Ann. 320, 321); and the doctrine has been enforced, to affirm or reverse a judgment in part when offered for the first time in the appellate court: Rohm v. Jallans, 134 La. 913, 917; McMichael v. Horay, 90 N. J. L. 142, 145, 146.

Although, of course, it is a general rule of practice that a point not presented to the court below cannot be urged, on appeal to obtain a reversal, still it is equally well established that a correct decision will be sustained for any reason which supports it, particularly where, as here, the ground was formally presented to the trial court, even though not there acted upon: Corgan v. Geo. F. Lee Coal Co., 218 Pa. 386, 392; Brew v. Hastings, 206 Pa. 155, 162; Derry Council, No. 40, v. State Council, 197 Pa. 413, 420; Com. to use v. Wing, 253 Pa. 226, 230; 2 E. C. L. 189.

It must be kept in mind that the decree of the Superior Court, in Consolidated Water Supply Co., v. State Hospital, supra, is between the same parties as those engaged in the present case, wherein it differs from Hart’s App., 8 Pa. 32, 37, and Gibson v. Rowland, 35 Pa. Superior Ct. 158, 165; furthermore, it is pleaded not as stare decisis but as res ad judicata, the former having to do with the binding effect of legal principles and the latter with the conclusiveness of prior judicial findings based upon the same facts as those involved in a pending controversy, between the same parties over the same subject-matter. While decisions of subordinate appellate courts are not stare decisis in a higher court, yet, when all other circumstances essential to the application of the doctrine of res adjudicata exist, such decisions will be treated, in a subsequent suit between the same parties, as conclusive: Thaler Bros. v. Greisser Construction Co., 229 Pa. 512, 519, 520. Any other doctrine would be intolerable, especially in cases like the one at bar, involving title to property, where, after the first judicial determination, large expenditures might be incurred for improvements, all of which could be swept away by an adverse decision, on the same point, in subsequent litigation, over the same subject-matter, between the same parties: 15 R. C. L. 954-5.

When, under circumstances such as just described, a court of ultimate jurisdiction feels compelled to depart from a prior adjudication of another court of appeal, it of course has the power to do so, just as it may overrule one of its own judgments, but that right will be exercised only where the prior decision presents palpable error committed on a controlling point at issue. No such condition confronts us in the present instance. On the contrary, the governing issue — concerning the title to the water in controversy — was correctly decided before; it is now res ad judicata, and appellee is in no sense barred from so contending. This leaves only one other matter for consideration, which necessarily could not have been embraced in the prior suit, namely, the propriety of the award of damages to the present plaintiff and the sufficiency of the evidence offered to sustain it.

The award was proper under the well established doctrine that, when equity takes cognizance of a case it will give complete relief; and we see no merit in appellant’s complaint that the evidence is insufficient to prove the amount of the damages. It appears that, during the months in which defendant company illegally appropriated plaintiff’s supply, the former sent bills to the latter, charging it for water approximately at the rate adopted by the chancellor; that defendant opened the dam and drained off about four-fifths of the reservoir’s contents; that its capacity was fixed by survey, and four-fifths thereof amounted to the given number of gallons with which the chancellor charged defendant. These proofs amply sustain the award of damages, and, on the facts at bar, the court below rightly decided that the water actually stored in Reservoir 7 was the private property of plaintiff (Gould on Waters — 3d ed., 1900— p. 469; Ferens v. O’Brien, 11 Q. B. D. 21, 22); as such, it had monetary value.

This opinion has already run to undue length; we shall not attempt to pass specifically upon the forty-one assignments of error, none of which presents reversible error.

The decree is affirmed at cost of appellant.