Martin Emerich Outfitting Co. v. Siegel, Cooper & Co.

Mr. Justice Smith

delivered the opinion of the court.

The pivotal question presented by the record and in the briefs and arguments of counsel for decision is, whether the destruction of the premises of the defendant by fire on August 3, 1891, without the fault or negligence of the defendant, the said premises being thereby rendered untenantable, uninhabitable and incapable of being repaired, and in consequence thereof ‘ the defendant did not at any time after the1 fire use or occupy said premises or any part thereof for the transaction of its business, terminated the contract between the parties and absolved the defendant from further obligation or liability to the plaintiff.

The contract sued on is for the use of certain space in the building named therein to conduct a furniture business, nominally in the name of the defendant, in connection with the business of the defendant then carried on, for a period of five years from September 1, 1890. It contains certain regulations for the use of the space, the kind of stock which the plaintiff was to carry, the employment of help, the reporting of sales, and other details which are not important to be now considered, except in so far as they throw light upon the general purpose and character of the contract. The defendant agreed to set apart the space described in the contract for the use of the plaintiff, to make weekly settlements for the moneys received from sales of furniture, after deducting the expenses of the department, and to furnish heat and elevator service. For the space and service the plaintiff agreed to pay a fixed sum and in addition thereto five per cent, of the excess of its sales over seventy-five thousand dollars per annum.

While the contract has some of the elements of a lease and much of its phraseology is of the character usually found in contracts of lease, we are of the opinion that it does not create the relation of landlord and tenant between the parties; but, as said in Dickinson v. Hart, 142 N. Y. 183: “The agreement created a business arrangement for the benefit of both parties.”

The contract contemplates a particular space in the building or buildings named and no other space in any other building or buildings. It contains no provisions for the termination of the agreement in case of the destruction of the building by fire or other agency, or for any other cause except the failure of the plaintiff to comply with its terms. There is no language in the contract which relates to or contemplates the furnishing of any other space in another building. No intent or purpose can be gathered from the writing itself that it was to apply to any space in any other building than that named. On the other hand it bound the defendant to furnish the space and carry on business in the building named during the period specified; and it bound the plaintiff to conduct its business in the space named for the specified period. It is not contemplated even that the defendant might remove its business to any other place, for business reasons. The right so to do is not reserved in the contract, nor would plaintiff, in our opinion, be bound to follow defendant to any other place which it might select and determine to occupy, and carry on the department of the plaintiff there in connection with the business of the defendant. To hold that the plaintiff was so obligated by the agreement in question would amount to writing into the contract as made substantial and important provisions which were not only not expressed in the contract as made, but were not in the minds of the parties when the contract was framed and executed.

In placing this construction on the contract we are not unmindful of the following provision of the agreement: 1 ‘ This instrument and each provision therein, shall be construed liberally and in a fair and equitable spirit, in order to further the interests of each party of this agreement.” This provision, we understand, applies to the agreement and each provision therein, but does not apply to anything outside of the four corners of the instrument.

It is contended on behalf of plaintiff that the agreement was for the purpose of carrying on a particular kind of business in the defendant’s establishment, as a branch or department business, and in no wise dependent upon the particular locality in which the defendant carried on that business. And upon the removal of that business, whether by the voluntary act of the defendant, or by the destruction of the building in which the business was carried on, the plaintiff had the right under the contract to conduct the furniture department of the defendant’s business, and could have been held liable upon the agreement for failure so to do.

We find no such broad and general purpose expressed in the contract. The language used in the instrument is so simple and clear that it cannot be said to be in the least contradictory, obscure or ambiguous. Our attention is not called to any such provisions, sentence or clauses in the instrument. Nor is our attention called to any particular word, phrase or expression in the contract from which any such broad intent or purpose is manifested or even suggested. Putting ourselves as far as possible in the place of the parties when their minds met upon the terms of this agreement, and from a consideration of the circumstances surrounding .them, and the objects which they had in view, and reading the terms of the agreement in the light of all these circumstances and conditions, we cannot discover that the parties intended to provide for the conduct of the furniture department of defendant’s business by the plaintiff npon any or every voluntary removal thereof to any place which might be selected by defendant for the prosecution of its business; nor can we discover from the instrument that the contingency of the destruction of the defendant’s place of business, as shown by the evidence, was intended to be provided for in any manner. Reasons readily appear for making provision in such a contract for such contingencies. On the other hand, cogent reasons suggest themselves for not attempting to extend the contract so as to cover the contingency which actually occurred, or that of voluntary removal from the premises described. Differences as to the time of removal and place to which such removal should be made, the allotment of space, the service which should be rendered under unknown and special conditions, might give rise to endless controversies between the parties. The difficulties in the way of framing just and equitable provisions for the unknown contingencies and situations which might thus arise would prevent prudent men from committing themselves to such uncertainties in a large business enterprise. Doubtless, the parties to the agreement, if they at any time during the preliminary negotiations which led up to the agreement thought of the desirability of providing for these unexpected contingencies within the brief period covered by the contract, never brought it up for mutual consideration for the purpose of embodying them in the contract; or, if they were so considered, the difficulties of providing therefor, in a contract which was to be binding on both parties alike, led to the entire abandonment of the idea, for the contract when considered in detail and as an entirety, is significantly silent upon that subject, containing no word or expression indicating any such intent or purpose.

In view of these considerations, it is apparent, we think, that there is no warrant in the contract for the construction sought to be placed thereon by counsel for plaintiff. In our opinion, the contract is based upon the contract of the business in the particular space in the building described therein, and in no other place; and that the tender by the defendant of space and service in the building in which it did business after the fire would not be a substantial performance of the contract on its part in law. Whether the contract could be substantially performed or not, in that way, was not, in our opinion, a question of fact which should have been submitted to the jury.

The next question for consideration then is, what effect, if any, the destruction of the building shown by plaintiff’s evidence had upon the contract.

In 2 Chitty on Contracts (11 Am. Ed.) 1076, the author says: “But in contracts from the nature of which it is apparent that the parties contracted on the basis of continual existence of a given person or thing, a condition is implied that if the performance becomes impossible from the perishing of the person or thing, that shall excuse' such performance.”

The learned author cites Taylor v. Caldwell, 3 Best & Smith, 826, in support of the doctrine stated by Mm. In that case a contract was involved for the giving of concerts in a certain music hall which was destroyed by fire accidentally. It was held that both parties were thereby excused from the performance of the contract, because the general rule requiring absolute performance “is only applicable where the contract is positive and absolute and not subject to any condition, express or implied.” In that case it was further held that: “Where from the nature of the contract it appears that the parties must from the beginning have known that it could not be fulfilled unless, when the time for the fulfillment arrived, some particular specified thing continued to exist, so that, when entering into the contract, they must have contemplated such continMng existence as the foundation of what was to be done, then, in the absence of any express or implied warranty that the thing shall exist, the contract is not to be construed as a positive contract, but as subject to an implied condition that the parties shall be excused in case, before breach, performance becomes impossible from the perishing of the tMng without the default of the contractor.”

This doctrine has been enunciated and approved in Walker v. Tucker, 70 Ill. 527; Siegel, Cooper & Co. v. Eaton & Prince Co., 165 id. 550; Huyett & Smith v. Chicago Edison Co., 167 id. 233; and Smith v. Preston, 170 id. 179. It is sustained by numerous authorities in other jurisdictions, some of which are, Wells v. Calnan, 107 Mass. 514; Dexter v. Norton, 47 N. Y. 62; and Shear v. Wright, 60 Mich. 159.

In our opinion, the destruction of the building rendered a substantial performance of the contract impossible, and excused its further performance.

It thus appears that the evidence produced by the plaintiff with all the inferences proper to be drawn therefrom did not fairly tend to prove the cause of action set out in the declaration, and the court, therefore, properly directed a verdict.

The judgment is affirmed.

Affirmed.