Canal Co. v. Hill

82 U.S. 94 (1872) 15 Wall. 94

CANAL COMPANY
v.
HILL.

Supreme Court of United States.

Mr. W.S. Cox, for the Company, appellant in the case.

Mr. W.D. Davidge, contra.

Mr. Justice BRADLEY delivered the opinion of the court.

The large investment of capital made by the appellee in sole reliance on the water-power which the lease secures, with the full knowledge which the appellants had of this reliance and intended investment, renders it necessary that we should look carefully to the substance of the original agreement, of January, 1864, as contradistinguished from its mere form, in order that we may give it a fair and just construction, and ascertain the substantial intent of the parties, which is the fundamental rule in the construction of all agreements. It is not to be presumed that they intended to provide for a certain aperture in the canal without respect to the amount of water it would discharge and the purpose which that water was to accomplish. What the appellee sought was water-power to drive the machinery of an expensive mill. The appellants knew this to be his object, and the thing leased or granted was intended to be, and in fact was, water, as the means of creating such power. It was not only water, but a certain quantity of water, namely (in the words of the lease), "so much water as will pass through an aperture of two hundred square inches," under certain conditions specified. The parties clearly had in view a fixed quantity of water to be received in a given time. In ascertaining their mutual rights under the lease, it is important to know how much this quantity was. When we know that, we know the substance of the agreement.

Now, in speaking of a certain quantity of water, we always have reference to its cubical contents, its bulk or weight. We mean so many gallons, or hogsheads, or cubic feet of water. We have no reference to surface or sectional measurement. A square foot, or a square inch of water, expresses no quantity at all. But when we speak of the quantity which will pass through a square foot, or square inch of aperture, in a certain time, then our words have meaning. The size and position of the aperture so carefully prescribed in the lease were intended merely as a means of measurement of the real thing granted, namely, that certain quantity of water per second, or per hour, which the parties had in mind, and about which they were dealing. If we can ascertain this, we can easily adjust the mutual rights of the parties. Can it be ascertained from the terms of the lease, aided by the light derived from the evidence in the cause? We think it can. And in making this inquiry we have a right to examine into the state of things existing at the time and the circumstances in which the lease was made. This kind of evidence is especially pertinent when the inquiry is as to the subject-matter of the agreement.

The amount of water which will be discharged through an aperture of a given size will depend upon the form of the aperture, the head under which the water is drawn, and the freedom from obstruction with which it is permitted to flow away.

In this case the lessee is not restricted as to the form of the aperture, except, perhaps, that it shall be rectangular. So that it contains only the content of two hundred square inches he is at liberty to construct it of such relative dimensions as he sees fit. Of course it is his interest to give it the greatest length and the least height consistent with a free flow. Such a form gives the greatest head of water above the aperture and increases the discharge. The right of superintending and directing the construction of the works, reserved to the lessors, cannot be construed to restrict this discretion of the lessee. That right has more particular reference to the manner of the construction, and the solidity and safety of the work, in reference to the structure and uses of the canal. It cannot be allowed to annul the substantial rights of the lessee without becoming repugnant to the grant.

In the next place, as to the head of water under which the leased water is to be drawn, the only restriction imposed upon the lessee in this regard is that the lower edge of the aperture shall not be nearer to the canal bottom than two feet. Of course he is entitled to draw under the entire head of water above this two feet. What that head shall be will depend upon the usual depth or height of water in the canal. It is to be presumed that the parties contracted in reference to that. The lessors do not guarantee any particular head; but any alteration of their canal which would materially and permanently reduce it would abstract from the lessee a portion of the water, which he must be presumed to have stipulated for. The contract was made in reference to the state of things existing at the time it was made.

In the third place, as to the freedom from obstruction with which the water shall be permitted to flow off and be discharged: the lease imposes no restrictions upon the lessee on this point, except that he shall not affix to the aperture any attachments or contrivances for increasing the flow beyond what it would otherwise be. This restriction relates to the well-known law of practical hydraulics that an adjutage or nozzle attached to the outside of an aperture prevents the vein of water from contracting and increases the aggregate discharge. With this exception, however, the lessee is entitled to draw off from the canal as much water as the two-hundred-inch aperture will discharge when it flows free from any obstruction except that which may arise from the ordinary use of the water in milling operations. This is a very important and essential right of the lessee, and one of which the lessors cannot deprive him under any pretence of regulating and directing the mode of constructing his forebay and its appendages. If the water is discharged under a four-feet head (which is about what the evidence shows to be the fact), the practical rules of hydraulics determine exactly how much water will issue in each second of time from a rectangular aperture of two hundred square inches, provided it meets with no obstruction outside, as where it falls out freely into open space. Mr. Hutton, the commissioner, to whom, as an expert, certain important questions in the cause were referred by the court below, says that the other mills discharge about six and two-thirds cubic feet per second for every one hundred inches of aperture. This is probably a little less than the discharge would be in the open air, because there is undoubtedly some obstruction to the flow arising from the passage of the water through the flumes.

This rate of flow would give to the appellee, through his aperture of two hundred square inches, a discharge of thirteen and one-third cubic feet per second. Something like this amount of actual water must be considered as within the intent of the parties to give and receive.

But the fact became developed that, by the faulty construction of the appellee's forebay or flume, arising from its small capacity, its great length, and its want of pitch or slope, he does not get but about one-half of the amount of water which is due to the aperture in the canal, and which he ought to receive. This fact is established beyond a question by the evidence.

Now, certainly, it is not equitable, even if it be in accordance with the strict letter of the lease, that the appellee should be compelled to pay full rent for half the quantity of water, which, according to the real intent of the parties, he stipulated for. True it may be said that it was his own fault, to construct the forebay in the disadvantageous manner which he has done, and that if he wants the full benefit of his lease he should tear it down and reconstruct it differently. This would require a great sacrifice on his part, and would not benefit the appellants. Surely, a court of equity cannot be compelled to consign a party to such a clumsy and ruinous remedy as this. The appellants can sustain no injury by allowing the lessee to take so much water as he supposed he was getting and as they supposed they were granting. This would be in accordance with the substance of the agreement. It would carry out the intent of the parties as gathered from the whole instrument and the state of affairs existing at the time it was made, and would save the lessee from a ruinous expenditure for alterations rendered necessary by his mistake.

It may be said that the location of the appellee's mill at a distance of 350 or 400 feet from the canal was a circumstance which the lessors had a right to take into account, and that by having to conduct the water such a long distance it could not be supposed that the lessee would be able to draw as much water through a given aperture as if his mill had been located nearer. This is true; and whatever is due to that circumstance the appellants are entitled to insist upon. But Mr. Hutton, the commissioner, says in his report that, making all allowance for the particular circumstances and location of the appellee's mill, he still ought to receive at least eleven cubic feet per second through the aperture named in the lease; whereas, in fact, he receives only twenty-three cubic feet through an aperture of seven hundred inches, or at the rate of only about six and a half cubic feet per second for an aperture of two hundred inches.

But if the appellee should receive eleven cubic feet of water per second, to which his lease may justly entitle him, this is not sufficient to drive his mill; and the question then arises as to the additional quantity which he requires, and which, according to the witnesses, is about twelve cubic feet per second. It appears from the case that the appellants agreed to furnish him the additional amount required for his mill on the usual terms; and that the appellee accepted the offer; but, in consequence of the controversy which arose about the measurement of the water and his refusal to comply with their demands, they declined to carry out the agreement. Had the appellants been right in the position they assumed, they would have been justified in making this refusal. But we think that they were not right, and, therefore, that they are bound to carry the agreement into effect, and that the appellee is entitled to receive the additional amount required, at the same rate, and on the same terms at which he was to have the original two hundred square inches. And as eleven cubic feet of water per second are due to the original aperture named, the additional twelve cubic feet per second would require, according to the report of the commissioner, a corresponding aperture of two hundred and seventeen square inches. For this additional amount of aperture the appellee should be charged, making the total amount four hundred and seventeen square inches. But to get the water to which it entitles him, as his forebay and apparatus are at present constructed, he is obliged to have, in reality, at the canal, an aperture of seven hundred square inches. The appellants were willing that he should have this aperture by increasing the height of the original aperture, but insisted that he should pay for seven hundred inches, according to the terms of the lease. Under the peculiar exigencies of the case, obstructed as the flow now is, we think that for the aperture named he should be charged for only four hundred and seventeen square inches. This is precisely the view on which the decree below is based, and we think it is correct. But as the difficulty between the parties originated from the mistake made by the appellee himself in the construction of his forebay and works, he ought not to recover any costs from the appellants, either in this court or the court below.

The result is that the decree must be

AFFIRMED, BUT WITHOUT COSTS IN EITHER COURT.

Mr. Justice STRONG, with whom concurred Mr. Justice DAVIS, dissenting:

I dissent from the judgment given in this case. In my opinion, it practically makes a new contract for the parties; a contract to which they never agreed. It holds that what, at most, was an expectation of results amounts to a binding obligation that they shall follow. To this I cannot agree.