McSwain v. Atlantic Coast Lumber Corp.

November 18, 1913. The opinion of the Court was delivered by acting Associate Justice in place of Mr.Justice Woods. This case was commenced by the service of a summons and complaint on January 16th, 1913, and is for the purpose: First, of specific performance; second, to obtain a decree of the Court adjudging a deed and contract, a copy of which is attached to the complaint, to require the grantee therein to commence cutting and removing the timber therein conveyed within a reasonable time; third, that such reasonable time had elapsed and expired prior to entry; fourth, that the defendant, Atlantic Coast Lumber Corporation, had forfeited and lost all rights under said deed by expiration of such reasonable time; fifth, for the purpose of securing an injunction against the cutting and removing of the timber in question. A temporary injunction was granted by Judge Spain on January 15, 1913, and was dissolved on January 25, 1913, on motion of the defendant, Atlantic Coast Lumber Corporation, on notice duly given.

This appeal is from the order of the Circuit Judge dissolving the injunction, and is based on eight exceptions, all of which need not be considered, as will be shown hereafter. No answer appears in the record before the Court, and it must be assumed there was none to the complaint herein. The complaint, together with the record now before the Court, show: That on December 15, 1898, H.H. Alford made and delivered to R.L. Montage what is known as a "timber deed," or contract, wherein there was no time fixed when the party having the right to do so, should commence to cut and remove the timber from the land described therein, and described in the complaint. Endorsed on the back of this "timber deed" is a receipt by H.H. Alford dated 17th of January, 1900 whereby he acknowledges in full the purchase money of same, and that the deed becomes absolute and complete, according to its terms. Thereafter the defendant, Atlantic Coast Lumber Corporation, acquired all the rights of Montage. On November 9th, 1910, D.K. Godbold, being seized in fee and possessed of said land, executed and delivered to S.W. Norwood an instrument, termed an option, whereby he sold the right to purchase said timber for one thousand dollars, payable one dollar cash and the balance within sixty days from the filing of the decision of the Court of last resort affirming a good and sufficient title to the grantee for the timber therein conveyed. Thereafter S.W. Norwood sold this option or paper, to T.C. McSwain, who accepted the terms and conditions therein stated, and, in good faith, put up one thousand dollars in the hands or possession of the clerk of the Court for Marion county to be paid to S.U. Davis, the same being the consideration named in the option, and D.K. Godbold, having thereafter conveyed the tract of land to the defendant, S.U. Davis, who had notice of the option. On the 25th of July, 1911, Godbold executed an instrument whereby he authorized and empowered Mr. Henry Buck, his attorney, to represent him "in any settlement that may be made by any person or persons, firm or corporation; and to institute and prosecute any action or actions as to him may seem necessary or expedient, it being expressly understood and agreed that said T.C. McSwain shall bear all expenses in connection with any settlement or litigation, and shall pay all attorney's fees." This instrument recites, "It was the intention of the parties to said option that a suit should be instituted by the said S.W. Norwood, to remove any cloud that might exist upon the title to said timber." The complaint alleges that defendant, Atlantic Coast Lumber Corporation, with a force of hands * * * on the 20th of December, 1912, with the connivance and consent of S.U. Davis, entered upon the land in utter disregard of plaintiff's rights, prepared and intended to operate * * *, and began to cut and remove the timber therefrom, as the plaintiff is informed and believes, and that the defendant, Atlantic Coast Lumber Corporation, intends to continue to do so; that it has already cut and removed large quantities of timber; that the cutting and removing would involve irreparable injury upon the plaintiff. The above statement from the record is sufficient for this appeal. By reference to the order of the Circuit Judge it will be seen there is no reason given for dissolving the temporary injunction. The defendants, however, state in their printed argument, that the motion was made on three grounds; the Court must therefore assume that it was upon one or more or all of these grounds that the order dissolving the temporary injunction was based.

The first ground was: "That the contract appeared on the face of the papers to be champertous and barratrous, and thereby contrary to public policy and void." At the hearing of the case, individually, I was very much impressed with this position and contention of the defendants, but after investigating the following authorities, I am satisfied this position can not be sustained. 5 Cyc. 618, note 15; 5 A.E. Enc. of Law 820; Fraser Dill v. Charleston, 13 S.C. 545; State v. Chitty, 1st Bailey 400;Verdier v. Simmons, 2 McCord Eq. 558; Thayer v. Clews,115 U.S. 528; Elser v. Village of Gross Paint, 114 Am. At. Rp. 326; Brown v. Bigne, 28 Am. St. Rp. 752; MetropolitanLife Ins. Co. v. Fuller, 29 Am. St. Rp. 196.

Second ground: "That the papers showed upon their face and that it appears upon the face of the complaint, when considered in connection with the documents attached thereto, that plaintiff has no title to the property in dispute, that he has not even such a claim as would entitle him to specific performance, and that he could not maintain an action upon such title, or absence of title for an injunction." The record in the case shows that the plaintiff, the assignee of the original option, has elected to affirm the contract for the sale of the timber, and has deposited one thousand dollars with the clerk of the Court, the amount to be paid for the timber as per the contract, and has brought an action to require the performance of the contract, and to remove any cloud upon the title, and after the Court of last resort shall affirm a good and sufficient title as per the agreement contained in the power of attorney then the one thousand dollars is to be paid for the timber. Godbold, in the power of attorney, acknowledges plaintiff's readiness and willingness of perform, and agrees that he may perform when the cloud upon the title is removed. The following authorities hold and lay down the doctrine that "Acceptance, within the time specified, of an option to purchase and compliance with the conditions, if any, changes the option into a contract of sale, binding upon both parties." 39 Cyc. 1243; Ross v. Parks, 30 Am. St. Rp. 47; Mier v. Hadden, 118 Am. St. Rp. 586; Sams v. Fropp, 10 Rich. Eq. 447; Lumber Co. v. Smalls 84 S.C. 439. These authorities are not in conflict with the authorities cited by defendant, to wit: Waterman v. Banks,144 U.S. 390; Richardson v. Hardwick, 106 U.S. 394;Bank of Columbia v. Hagner, 25 U.S. 1st Peters 464; RutlandMarble Co. v. Ripley, 77 U.S. 10; Wal. 359.

These authorities apply where the parties stand in the relation to each other as option or and optionee, not where the relation has been changed to that of vendor and vendee, by a compliance with the terms and conditions of the option, accepting them and placing the purchase price where it is available to pay for the timber, as in this case, and as agreed upon by the option or and the optionee, when the title is perfected. The second ground of contention of the defendant can not, therefore, be sustained.

Third ground: "That upon the face of the papers, and upon the overwhelming weight of the evidence, the defendant corporation should be held to have commenced cutting and removing the timber in question within the time permitted by the contract, and was, therefore, within its rights in continuing to cut the timber."

This involves the main issue, to wit: What is a reasonable time within which to commence to cut and remove the timber? This issue must be settled and determined when the case is tried on its merits by the proper judicial tribunal.McClary v. A.C.L. Corporation, 90 S.C. 153; Crawford v. A.C.L. Corporation, 77 S.C. 81, 57 S.E. 670; 10 L.R.A. (N.S.) 736n; Riley v. Union Station Co., 67 S.C. 84,45 S.E. 149.

To try this issue upon affidavits would be a most unsatisfactory mode of eliciting truth. Cudd v. Calvert, 54 S.C. 157.

There is no answer to the complaint in so far as the record shows, hence the facts stated therein are not denied, for the purposes of the case under consideration, and besides the verified complaint there is the affidavit of D.K. Godbold, which is in direct conflict with the affidavit of John Richardson, Jr., the only evidence submitted by the defendant on motion to dissolve the temporary injunction. So, if the Circuit Judge based his order of dissolution on the third ground it was really trying the main issue in the case, based on the verified complaint and the affidavit of D.K. Godbold on behalf of the plaintiff, and the affidavit of John Richardson, Jr., on behalf of the defendants, which, according to Cudd v. Calvert, supra, is a most unsatisfactory mode of eliciting truth. The third position or contention of the defendant cannot therefore be sustained.

There is no difference between this case and the principle laid down in the case of Gresham v. A.C.L. Corporation,ante 53, except in the Gresham case the legal title to the timber was involved, and in this case the equitable title to or interest in the timber is involved.

The Court will grant an injunction upon a proper showing where equitable interest or title is the issue involved, as well as where the legal title is the issue involved, and the showing made, at the hearing below, before the Circuit Judge was sufficient to grant an injunction upon. Payne v. Melton, 67 S.C. 233, 45 S.E. 154; Boyd v. Traxler,84 S.C. 51, 65 S.E. 936; Sizemore v. Jennings, 88 S.C. 243,70 S.E. 726.

Exceptions four, five and eight made by the plaintiff are sustained, they covering in substance all the errors imputed to the Circuit Judge. It is unnecessary to consider the others.

It is the judgment of this Court that the order of the Circuit Judge dissolving the injunction be, and the same is hereby, reversed. Let the complaint, the exceptions, and power of attorney, the affidavit of John Richardson, Jr., and of D.K. Godbold, be printed with the report of the case.

THE CHIEF JUSTICE concurs on the ground that the plaintiff made a prima facie showing, when the temporary order of injunction was granted; and that the ends of justice would be subserved by continuing the injunction, especially as the dissolution thereof would materially change the status of the property, and might be very prejudicial to the rights of the parties.