Hutchins v. Munn

Mr. Justice Robb

delivered tbe opinion of tbe Court:

1. It is urged that tbe court below erred “in finding and bold-ing that tbe defendant, Mrs. Munn, was enjoined, aad therefore entitled to any damages whatever on tbe injunction undertaking.” So far as tbe record discloses, this is tbe first time since tbe inception of this litigation, in August, 1902, that it has been contended that Mrs. Munn was not properly before* the court and subject to tbe restraining order so long as thal order was in force. Within three days after tbe order was issued, notice was given the solicitors for tbe complainant by Mr. Maddox and Mr. Gatley, as attorneys for defendants, that they would shortly move to dissolve tbe injunction. Mrs. Munn testified that she was notified of tbe restraining order by Mr. Maddox in August, 1902, which must have been within two weeks from tbe time it was issued. Mr. Munn soon thereafter returned to tbe United States, and Mr. Maddox filed a joint and several answer for Mr. and Mrs. Munn, to which no objection was made. That appellant’s solicitors then understood and believed that Mi’. Maddox was fully authorized to enter an appearance in behalf of all tbe defendants is apparent from tbe fact that no effort appears to have been made to serve Mr. Munn with process while be was in tbe United States. We think tbe appearance of Mr. Maddox and Mr. Gatley for tbe Montis was a waiver of actual service, — especially as all doubt was removed as to their authority to enter such an appearance by tbe filing of the above answer on October 30, which must be held to be a ratification of tbe authority previously exercised, and to relate back to the original appearance.

Want or insufficiency of service of process in an action for injunction is cured by appearance and plea of defendant. Underwood v. Wood, 93 Ky. 177, 15 L.R.A. 825, 19 S. W. 405; Cooley v. Lawrence, 5 Duer, 605; Parker v. Williams, 4 Paige, 439; Seebor v. Hess, 5 Paige, 85.

Although notice of an application for injunction is required by statute, it is waived by a voluntary appearance. 10 Ene. PI. & Pr. p. 999.

Moreover, we cannot assent to the proposition that a defendant may have actual knowledge of the issuance of an injunction, and disobey it with impunity. We think the authorities are to the contrary. In the case Re Lennon, 166 U. S. 554, 41 L. ed. 1113, 17 Sup. Ct. Rep. 658, the court, through Mr. Justice Brown, said: “The facts that petitioner was not a party to such suit, nor served with process of subpoena, nor had notice of the application made by the complainant for the mandatory injunction, nor was served by the officers of the court with such injunction, are immaterial, so long as it was made to appear that he had notice of the issuing of an injunction by the court. To render a person amenable to an injunction, it is neither necessary that he should have been a party to the suit in which the injunction was issued, nor to have been actually served with a copy of it, so long as he appears to have had actual notice. High, Inj. sec. 1444; Mead v. Norris, 21 Wis. 312; Wellesley v. Mornington, 11 Beav. 181.”

In Ulman v. Ritter, 72 Fed. 1000, this question was discussed, and the court said: “The counsel for defendant seek to relieve him from the responsibility of his conduct in this respect, contending that knowledge thus acquired, of the existence of the injunction, had no legal and binding effect upon him. I cannot agree with them in their position, and I am unable to find, either in the text-books or adjudicated cases, any authority to sustain such a position. If such a position could be maintained, it would destroy to a great extent the effect of the restraining powers of courts of equity, and their usefulness would be greatly impaired. I hold the unquestioned law to be that an injunction becomes operative from the time the order was made, and effective upon the party from the time he has notice of its existence. It is a matter of no moment how the defendant acquired the information of its existence. When once he has been apprised of the fact, he is legally hound to desist from doing what he is restrained and inhibited from doing. If this were not the rule, often great injury could be inflicted, in numberless cases, though the mandate of the court was in existence.” See also Ex parte Richards, 117 Fed. 658; State v. Knight, 3 S. D. 509, 44 Am. St. Rep. 809, 54 N. W. 412; Winslow v. Nayson, 113 Mass. 419; Golden Gate Consol. Hydraulic Min. Co. v. Superior Court, 65 Cal. 187, 3 Pac. 628; Burr v. Kimbark, 29 Fed. 428; Edwards v. Edwards, 31 Ill. 474.

Holding, as we do, that Mrs. Munn was properly before the court and subject to the restraining order, it necessarily follows that she was entitled to recover any damages “suffered or sustained by reason of wrongfully and inequitably suing out the injunction.”

2. The other assignments of error may be considered together, as they all relate to the finding of the auditor that the measure of damages was the value of the use of the property during the season of deprivation; that is, from about November 1 to March 1, notwithstanding that the injunction was dissolved in November.

In approaching this question we must have in mind the functions of an auditor, and the weight and consideration to be given his findings. As was said by this court in Richardson v. Van Auken, 5 App. D. C. 209: “The findings of a master or an auditor, concurred in by the court below, are to be taken as presumptively correct, and will be permitted to stand, unless some obvious error has intervened in the application of the law or the principles of the decree under which he acts, or some important mistake has been made in the evidence, and which has been clearly pointed out and made manifest. This rule has been repeatedly affirmed by the Supreme Court of the United States, and is one of general application in the equity practice, both in the Federal and State courts of the country. Tilghman v. Proctor, 125 U. S. 136, 31 L. ed. 664, 8 Sup. Ct. Rep. 894; Evans v. State Nat. Bank, 141 U. S. 107, 35 L. ed. 654, 11 Sup. Ct. Rep. 885; Crawford v. Neal, 144 U. S. 585, 36 L. ed. 552, 12 Sup. Ct. Rep. 759; Furrier v. Ferris, 145 U. S. 132, 36 L. ed. 649, 12 Sup. Ct. Rep. 821.” The question was also discussed in Smith v. American Bonding & T. Co. 12 App. D. C. 192, the court saying: “The auditor is not a mere examiner in chancery, to take testimony for the convenience of the court, and to return it to the court for its consideration. The auditor is a judicial officer, charged with judicial functions; as has been repeatedly decided; and his findings of facts are analogous to the verdict of a jury in a suit at common law. Such findings of fact are conclusive, unless their correctness is impugned under proper proceedings for the purpose. * * * In the order of reference there was no requirement that the testimony, which the auditor was directed to take in order to enable him to reach a determination, should be returned to the court, or made part of his report; and it may well be questioned whether the fact that he returned the testimony with his report justifies its being considered as part of his report. * * * It is well settled that, in reference to findings of fact by an auditor or master in chancery, his conclusions, ‘depending upon the weighing of conflicting testimony, have every reasonable presumption in their favor, and are not to be set aside or modified, unless there clearly appears to have been error or mistake on his part.’ (Tilghman v. Proctor, 125 U. S. 136, 149, 31 L. ed. 664, 668, 8 Sup. Ct. Rep. 894), which rule was repeated in the case of Callaghan v. Myers, 128 U. S. 617, 32 L. ed. 547, 9 Sup. Ct. Rep. 177. In the case of Richardson v. Van Auken, 5 App. D. C. 209, 213, and again in the case of Grafton v. Paine, 7 App. D. C. 255, as well as in some subsequent cases, we have had occasion to enforce this same rule.” See also Grafton v. Paine, supra; Haller v. Clark, 21 D. C. 128; York v. Tyler, 21 D. C. 265; Sheffield & B. Coal, Iron & R. Co. v. Gordon, 151 U. S. 285, 38 L. ed. 164, 14 Sup. Ct. Rep. 343.

In his first report the auditor found “that this property was purchased by Mrs. Munn some years ago, at a cost* of $70,000, and that since that time sundry improvements or additions have been constructed at a substantial cost. The house was purchased and maintained for the occupation of Mrs. Munn and her family, and was furnished in a style corresponding to its character and size. It was the practice of the family to occupy the house from the fall until the late spring and for the remainder of the year they spent the time at other localities in this country, or abroad. The progress of the worlc on this addition at the date of the restraining order was such as to render the house for dwelling purposes practically uninhabitable. Taking up the claim for the loss of the use of the property resulting from the restraining order, it appears in proof that the work on the addition to the main house was commenced the first week in July, and was intended to be completed in four months, which would have brought the completion to the early part of November, in time for the family to resume their occupation. At the date of the restraining order, approximately a month and a half of the estimated time had elapsed and a proportionate part of the work done. The work was then suspended until the decree of this court, on the 25th of November, dissolving the-restraining order, so that three months and ten days of useful time of this character of work had been wasted. The building of the addition was not completed and the house ready for suitable occupancy until late in April or very early in May of 1903, near the time at which it was the custom of the family to leave Washington for their summering. They were therefore deprived of the use of the property for the entire season of customary occupation. * * * That there is a Washington season which affects the rental term and occupancy of a certain class of property is a fact so generally known as to come nearly, if not quite within the scope of judicial notice. The property in question is of that class. The so-called season was the customary period of occupation by Mrs. Munn and her family. The claimant Mrs. Munn is entitled to the value of the use of the property during the season of deprivation, and the evidence is to be applied to that period, not solely for the purpose of showing what she lost as rent or income, but to determine what it would have cost ber to procure tbe use of other property approaching her own. in location, condition, and equipment, during such time. Taking tbe estimate of tbe several witnesses touching tbe rental value of Mrs. Munn’s property, I find a fair mean to be tbe sum of $8,000 per annum, of which I find three fourths — being $6,000 — to be tbe reasonable value of tbe use of tbe property for tbe period during which she was deprived of its use by reason.of tbe injunction.”

Because tbe auditor found in this report that Mrs. Munn was not responsible for delay in tbe progress of tbe work after tbe dissolution of tbe restraining order, she having employed a competent architect and a competent builder to superintend tbe work, tbe case was again submitted to him to find “whether there was any lack of reasonable diligence, and, if so, what damages she (Mrs. Munn) has sustained upon that basis.” In this second report tbe auditor, after a consideration of the testimony, said: “If it be assumed, as I find, that no unreasonable delay occurred prior to tbe 1st of January, another month’s work would bave brought it to tbe 1st of March, and would bave completed tbe builder’s estimate of tbe two and a half months. Even if tbe work bad been completed at that time, it is very evident that tbe property could not bave been rented, and the entire rental season would bave been lost. If Mrs. Munn bad waited until that time to occupy tbe residence, she would bave been without ber home during all tbe period from November to March by tbe fault of tbe complainant Hutchins. If in tbe month of November, when tbe work was resumed, she bad found and leased other property substantially tbe same in character, equipment, and location, and desired to occupy it till her own residence should be finished, she would have been compelled to pay tbe full season’s or year’s rental. So that, in either event, the injury suffered by ber in being deprived of tbe use of her residence was practically consummated before tbe 1st of November.” Tbe auditor therefore adhered to bis original finding as to the damages sustained by Mrs. Munn. Tbe record shows that be carefully considered and gave due weight to all tbe evidence submitted to him, and in a case like this, where his report has been ratified and confirmed by the court below, we are not disposed to disturb the findings therein, unless fully convinced such findings are not sustained by the evidence, or that they are predicated upon an ei*roneous view of the law. Doubts as to the findings of an auditor certainly should not be resolved against the injured party and in favor of the party causing such injury. We have carefully examined the whole record, and have reached the conclusion that the auditor’s findings are justified by the evidence. Mrs. Munn testified, and her testimony was not disproved, that her plans, by reason of the delay caused by the restraining order, “were decidedly changed; * * * as this restraining order was not dissolved until the 21st of November the building then had to go on, and it prevented us from occupying our house until late in the spring.”

On cross-examination she was asked:

Q. Now, Mrs. Munn, in the fall of 1902 was it not your intention to remain in Europe that fall ?

A. That was not our intention so far as I know anything about it. We had our cabins engaged to return to Washington and had to give them up, perhaps at a sacrifice.

Q. You know that of your personal knowledge ?

A. Yes.

It seems to us, therefore, that the auditor, from this and other testimony, was justified in finding that the Munn family intended to return to Washington and occupy their home during the winter of 1902-03. We think the finding of the auditor that there was a delay, “roughly estimated at about thirty days,” in the progress of the work after the injunction was dissolved, was a very liberal finding in favor of the appellant, in view of the fact that it would have taken two months and a half to complete the work during the period when the work could have been advantageously prosecuted; that is, from the middle of August, when the work was stopped by the injunction, until the 1st of November. Considering all the testimony, and having in mind the character and quality of the work, and that it had to be prosecuted during the winter months, we are unable to say that there was any unnecessary delay. The addition Mrs. Munn planned was to be perfect in execution and in keeping with the house itself. She engaged skilful and competent men to prosecute the work, and instructed them to procure the best materials obtainable. She had a right to expect and to receive-a satisfactory and adequate return for her money, and Mr. Hutchins ought not to be heard to complain because the work,, after the dissolution of the restraining order, was not prosecuted with as much haste as it could, and, no doubt, would, have been prosecuted during the months of September and October. The auditor found, however, that, even though the house had been completed early in March, the damages suffered by Mrs. Munn would have been the same, because it would have cost her as much to rent a similar house from November to that time as for the season.

While the amount awarded seems large, we are unable to-find from the evidence that it is excessive. The property, aside-from the furnishings of the house, represented an investment of more than $100,000, and the finding was based upon the testimony of witnesses familiar with the rental value of similar-houses in the locality of the Munn house.

The point is made that, in no event, could Mrs. Munn recover damages for the loss of the use of the whole house, because-she was restrained from building the addition only. We think this contention untenable. Mr. Hutchins delayed action a month and a half, and did not arrest the progress of the work until the main house, as the auditor found, had been rendered “practically uninhabitable” by the removal of a considerable portion of the outside wall adjacent to the addition, and because-of and in connection with the construction of the addition. The-house continued to be uninhabitable, that is, unsuitable for the purposes of a family dwelling, until the addition was completed, and, inasmuch as the completion of the addition was stayed through the procurement of the restraining order, we think Mr. Hutchins must make good the damages directly resulting therefrom.

Objection is made that Mrs. Munn is not entitled to damages, because she did not in fact return to Washington, and in fact rent a similar house for the season. It appearing that Mrs. Munn, but for this injunction, would have returned to occupy her house during the season, we think she is entitled to damages for being kept out of it, notwithstanding she did not elect to live in some other similar house in Washington during that period. It was for her to determine whether she would occupy some other house in Washington, or whether, being kept out of her own house by the wrongful act of the appellant, she would live elsewhere during the winter of 1902-03; and the appellant is not in a position to complain because she chose the latter course. “Where a party is restrained, by -an injunction wrongfully sued out, from exercising acts of ownership over land, he will be entitled to such damages as are the necessary and proximate result of that deprivation. In determining their extent, the court proceeds upon equitable principles, and is not governed by arbitrary or technical rules.” 16 Am. & Eng. Enc. Law, 2d ed. p. 466.

The case of Edwards v. Edwards, 31 Ill. 414, was an action of debt upon an injunction bond. The plaintiff, by reason of the injunction, had been deprived of the use and enjoyment of certain property from March to September following, and in the opinion in that case the court observed: “The principal question, however, on the assessment of damages, is as to the use of the land. The injunction was issued early in the spring, and was dissolved in September, and during that time restrained the party from taking possession of a [certain] farm. The defendants insisted that the measure of damages was the value of the use of the land up to the time when the injunction was dissolved. We think the court properly allowed the evidence to take a wider range, and show that being kept out of the land till the 1st of September, occasioned the loss of the crops for the season. The question is not, what the land was worth to the complainant in the injunction suit, but what was the damage to the defendant for being kept out of possession during that period ?”

In Smith v. Wells, 46 Miss. 64, which was a suit on an injunction bond, the court said: “The loss of the use and rental of the premises for a year was the result of suing out the writ; or, at all events, the jury have certified that damages to the extent of the value of one year’s rent has ensued. But for the interference of the complainant, Mrs. Wells or her tenants would have occupied the premises, or she would have recovered possession, perhaps in time to have made them available. * * * The party injured by the injunction is entitled to compensation for all loss and injury, naturally and fairly referable to the wrongful act of the obligor.” See also Lange v. Wagner, 52 Md. 310, 36 Am. Rep. 380; Banks v. State, 62 Md. 88; Hicks v. Herring, 17 Cal. 566; Roberts v. White, 73 N. Y. 375; Alexander v. Colcord, 85 Ill. 323; Jones v. Allen, 29 C. C. A. 318, 56 U. S. App. 529, 85 Fed. 523.

Appellant in his brief refers to the admiralty case of The Conqueror, 166 U. S. 110, 41 L. ed. 937, 17 Sup. Ct. Rep. 510, as being in point on this question of the assessment of damages. That case was a libel to recover possession of the steam yacht Conqueror, which had been illegally detained by the collector of customs for the district of New York, and for damages for the illegal detention. It appears that the vessel was designed for pleasure only, and had never been put to any other use. The court said: “The main question in this ease turns upon the proper measure of damages. In the amount of $21,742.24, awarded by the final decree of the district court, was included the sum of $15,000, Tor loss of use of boat while detained by the respondent, from August 27, 1891, to February 3, 1892, at $100 per day.’ This is the principal item of damage to which objection is made in this court.” After directing attention to the fact that damages caused by an illegal seizure of a ship are in the nature of demurrage, and that, therefore, there must be actual loss in order to warrant a recovery, the court further said: “The difficulty is in determining when the vessel has lost profits, and the amount thereof. The best evidence of damage suffered by detention is the sum for which vessels of the same size and class can be chartered in the market. Obviously, however, this criterion cannot be often applied, as it is only in the larger ports that there can be said to be a market price for the use of vessels, particularly if there be any peculiarity in their construction which limits their employment to a single purpose. In the absence of such market value, the value of her use to her owner in the business in which she was engaged at the time of the collision is a proper basis for estimating damages for detention, and the books of the owner showing her earnings about the time of her collision are competent evidence of her probable earnings during the time of her detention. * * * Again, the court may properly take judicial notice of the fact that the yachting season in our northern waters practically comes to an end before the first of November, and, as The Conqueror was seized on August 27, during more than one half the time for which demurrage was allowed she probably would have been laid up at her wharf. It is true, there was a possibility that her owner might have desired her for use in a winter’s cruise to tropical waters; but there was not the slightest evidence of that, and the contingency of her being so used was too remote to justify an allowance upon that basis.”

We think there is a clear distinction between the case of The Conqueror and the case at bar. The Conqueror was a pleasure yacht only, and there was no evidence that her owner intended to use her during the period she was held by the collector. Moreover, she had been seized by an officer of the United States in the line of his duty, and, although it subsequently transpired that he had acted under a misapprehension of the law, the circumstances of the case demanded that clear, positive, and certain proof of actual loss be adduced to entitle her owner to recover damages for her detention.

In the present case we are dealing with a dwelling house and the home of the injured party. The testimony not only shows the value of the use of similar homes, but it shows that Mrs. Munn would have occupied and received benefit from her home, but for the injunction wrongfully procured by appellant.

The damages awarded her were, we think, the direct result -of the injunction, and comprehended within the terms of the undertaking entered into by appellant and his sureties “to make good all damages suffered or sustained by reason of wrongfully and inequitably suing out the injunction.”

The decree appealed from, in our opinion, should be affirmed, with costs, and it is so ordered. Affirmed.