Hollander v. Central Metal & Supply Co.

¹⁴⁷ Thomas, J., delivered the opinion of the Court. The Central Metal and Supply Company of Baltimore City, “a corporation duly incorporated under the laws of the State of Maryland,” having purchased the leasehold estate in a certain lot of land in Baltimore City, brought this suit on the 31st day of May, 1907, against the appellants, as the present, owners of the reversion in said lot, for a specific performance of the covenant in the lease of the lessor, “her heirs and assigns,” upon payment of the amounts specified therein, to convey the fee to the lessees, their “heirs and assigns.” The hill alleges that the defendants, Charles Hollander and Elsie Hollander, his wife, and Lee M. Hollander are nonresidents, and that the plaintiff, in January, 1907, addressed a letter to these defendants notifying them of its desire to redeem the ground rent under the lease, and prepared and forwarded to them for execution, a deed from them to the plaintiff of the fee in said lot, which they refused to execute on the ground that “the said rent is not redeemable.” After an order of publication had been passed against the nonresident defendants, Charles S. Hollander and wife filed a motion to rescind the order, and to quash the proceedings, on the ground (1) that a suit for the specific performance of a contract is a suit in personam, and can not he maintained against a non-resident on service by publication, and (2) that the order of publication in this case does not contain a sufficient description of the property to inform the defendants of the property involved in the suit. Sometime after this motion was filed, Lee M. Hollander filed a similar motion, alleging as an additional reason for rescinding the order as against him, that at the time of the bringing of the suit he was a resident of the State of Maryland. The case of Worthington v. Lee, 61 Md. 530 , was for specific performance of a covenant for a renewal of a lease for ninety-nine years, renewable forever, and for an injunction to restrain an action of ejectment for the recovery of the premises.

Some of the non-resident defendants appeared and pleaded to the jurisdiction of the Court to grant relief, while ¹⁴⁸ against others interlocutory decrees were entered' in default of. appearance and answer. The notice to non-residents was by publication, and the Court in dealing with the case as against the non-resident defendants, said, “If the application was for a sale of the property, or for a simple conveyance thereof, those objects-could be accomplished by the appointment of a trustee, as provided by the Code, Art. 16, Secs. 67, 135. 'But those provisions of the statute do not apply in a case like the present, where the object of the decree is to secure to the plaintiff the specific execution of the covenant, whereby she is entitled to obtain a renewed lease, with important and valuable personal covenants of the lessors, and without which it would not be an instrument of the character contemplated by the covenant decreed to be performed. The Court could direct a lease for ninety-nine years to' be made by a trustee, but not with covenant for renewal, and other personal covenants, to bind personally the owners of the reversion, their heirs and assigns. The Court could, through the instrumentality of a trustee, direct the conveyance of an estate, or the transfer of a right, but not the making of personal covenants, in the absence of the parties, to bind them personally, and those who may stand in privity with them.

The Court possesses'no such power as that inherently and the statute does not confer it.” In the case of Hart v. Samson, 110 U. S. 151 , cited and relied on in 'Worthington v. Lee, supra, the Court said: “It would doubtless be within the power of the State in which the land lies to provide by statute that if the defendant is not found within the jurisdiction or refuses to make or to cancel a deed, this should be done in his behalf by a trustee appointed by the Court for that purpose.” And in the ease of Arndt v. Griggs, 134 U. S. 316 , in passing upon a Nebraska Statute, and dealing with the right of the Slate to provide for notice to non-resident defendants, the Court said that the-State had “control over property within its limits; and the-condition of ownership of real estate therein, whether the owner be a stranger or a citizen, is subject to its rules concerning the holding, the transfer, liability to obligations. ¹⁴⁹ private or public, and the modes of establishing titles thereto. It cannot bring the person of a non-resident within its limits—its process goes not beyond its borders—but it may determine the extent of his title to real estate within its limits; and for the purpose of such determination may provide any reasonable methods of imparting notice.” Sec. 117 of Art. 10 of the Code of 1904, is as follows: “If in any suit in chancery, by bill or petition, respecting in any manner the sale, partition, conveyance or transfer of any real or personal property lying or being in this State, or to foreclose any mortgage thereon, or to enforce any contract or lien relating to the same, or concerning any use, trust or other interest therein, any or all of the defendants are nonresidents, the Court in which such suit is pending may order notice to be given to such non-residents, of the substance and object of such bill or petition, and warning them to appear by a day therein stated.” Sec. 127 of Art. 36, provides how the notice shall be given, and Sec. 91 authorizes the Court, whenever the execution of a deed of any, kind is decreed, to appoint a trustee to execute it. The prayer of the bill and the covenant here sought to be enforced is for conveyance to the appellee of the lot described in the lease, and while the Court could not enforce a decree requiring a non-resident to execute a deed for the property, its decree may be made effective under the provisions of the Code, by the appointment of a trustee to convey the title of the appellants, and to that end the proceedings are in rem and not in personam. Miller’s Equity Procedure, Sec. 120; White v. White, 7 G. & J. 208 ; 22 Am. & Eng.

Ency. of Law, 917; Phelps on Juridical Equity, Secs. 85, 223. The order of publication, which is set out in the record, in addition to describing the land as the “lot of ground on the East side of a ten foot alley in the rear of Lombard and Frederick Streets in the City of .Baltimore;” and as being subject to the annual ground rent of thirty-six dollars “created by the lease from Charlotte Bolgiano to Roberd Bolton and others, dated July 18, 1835, and recorded in Liber T. R.. ¹⁵⁰ No. 262, folio 294, etc.,” states that an undivided one-third interest in the reversion in said lot is vested in Edward Hollander, trustee for Amelia Hollander, for life, remainder to Charles S. and Levi M. Hollander, and that the remaining two-thirds interest is vested in said Charles S. and Levi M. Hollander, “as by reference to Liber R. O., No. 2243, folio 93 will appear,” and that the plaintiff notified the defendants by letter of its desire to redeem said rent, and prepared and had sent to them for execution, a deed from them to the plaintiff for their interest in said lot which they declined to execute and returned. The reference to the lease under and by virtue of which the defendants received the annual rent of thirty-six dollars, to their interest in the reversion, and to the letter and deed sent to them, could have left no doubt in their minds as to the land referred to, and we think was sufficient notice to the defendants of the subject matter of the suit. Mewshaw v. Mewshaw, 2 Md. Ch. 12 ; Phelps on Juridical Equity, 313. ■ The petition of Lee M. Hollander was answered by the plaintiff, denying that he was a resident of the State of Maryland, and again alleging that he was a non-resident.

The matter, as stated in the opinion of the Court below, was submitted, without proof, on the petition and answer, and his motion, and the motion of Charles S. Hollander, was, and we think properly, overruled. Where a case is submitted on petition and answer, the truth of the facts alleged in the answer is taken to be admitted, but the privilege of having a case so heard belongs only to the petitioner. The record does not disclose who set this motion down for hearing, but as the plaintiff in this case had no right to do so on the petition and answer, we must assume that it was done at the instance of the petitioner. Miller’s Equity Procedure, Sec. ,255 and notes.

After these motions were overruled, the defendants demurred to the bill on the following grounds: (1) that the bill does not show plaintiff’s right to take advantage of the covenant in the lease; (2) that the plaintiff does not offer to ¹⁵¹ comply with, the terms of the covenant; (3) that the covenant is not one running with the land, and cannot be enforced by the assignee of the lessees against the assignees of the lessor; and (4) that the covenant cannot be enforced against the assignee of the reversion because it violates the Rule against Perpetuities. The bill charges that the plaintiff, on the 9th day of January, 1907, obtained by deed from Benjamin Krulewitch, administrator, the leasehold property, a description of which is set out in the bill and in the plaintiff’s deed filed with the bill; that the lot of ground so obtained by the plaintiff is subject to an annual ground rent of thirty-six dollars, created by a lease from Charlotte Bolgiano to Robert Bolton and others, dated July 18, 1835, and recorded among the Land Records in Liber T. K., Ho. 262, folio 294, &c., and a certified copy of which is filed with the bill; “that the said lease contains a covenant on the part of said lessor, her heirs and assigns, that at any time during the continuance of said demise at the request and cost of said lessees, their heirs or assigns, and on their paying six hundred dollars, with all rent accrued and accruing, said lessor, her heirs and assigns, would cause to be delivered to said lessees, their heirs and assigns, a good and sufficient deed in fee simple, of and for the said property;” and that the plaintiff bought said property “upon the express condition that the said rent could be extinguished at its option at any time;” “that the reversion in and to said lot, with the right to collect the annual rent of thirty-six dollars, is now vested in said defendants, as follows: (a) Edward Hollander, trustee, one of the above-named defendants and trustee in the case of Edward Hollander v. Amelia Hollander et al., in the Circuit Court of Baltimore City (Docket 24A, folio 245), holds a one undivided third interest therein, for Amelia Hollander, another of the above-named defendants, for life, with remainder to Charles S. Hollander and Lee M. Hollander, other above-named defendants, absolutely. • (b) Said Charles S. Hollander and Lee M. ¹⁵² Hollander hold the other two-thirds undivided interest therein; as would appear by reference to the deed to said named defendants of said lot of ground, dated* May 10, 1905, and recorded among the said Land Records in Liber R. 0., No. 2143,- folio 93, &c.” That the plaintiff notified the nonresident defendants by letter of its desire to redeem said ground rent, and in January, 1907, prepared and had sent 1o them for execution, a deed to the plaintiff of their interest in. said lot, which deed they refused to execute on the ground that by the terms of said lease the rent was not redeemable ; that on the 20th of May, 1907, the plaintiff tendered to Edward Hollander, trustee, $210.30, it “being one-third of the said redemption money, together with the proportionate part of the accruing rent to the date thereof* and likewise, on May 31, 1907, tendered to Arthur W. Machen, Jr., Esq., solicitor of the defendants, Charles S. Hollander and Elsie .Hollander, his wife, and Lee M. Hollander, the sum of $420.60, being their two-thirds share of said redemption money, together with their proportionate part of the accruing rent to.said date;” and that at the same time plaintiff handed .to said trustee and said solicitor a draft for a new deed, “requesting them, and each of them, to have the same properly executed so as to vest” the plaintiff “with an absolute fee simple title in and to the property,” which deed is filed with the bill, and which they refused to execute or to have executed; and that said Machen was the solicitor of the defendants “in this matter.” The práyer of the bill is for leave to bring into Court the sum of $630.90 so tendered, and 'that a trustee may be appointed to convey to the plaintiff the reversion in said lot, etc. (1) The general rule is that the bill must state clearly plaintiff’s right to the relief prayed, and counsel for the appellants insist that in compliance with this rule, the bill should have set out all of the assignments from the original lessees down to the plaintiff, in order to show the right of the plaintiff, as assignee of the leasehold estate, to the benefit ¹⁵³ of the covenant sought to be enforced. The leasehold interest was conveyed by the lease to the lessees, their executors, administrators and assigns, and the bill charges that the plaintiff is the owner of the leasehold property described in said lease by virtue of the deed from Benjamin Krulewitch, administrator. If the covenant is one that runs with the lease, in favor of the assignee of the lessees, the right to the leasehold interest created by the lease entitles the owner to the benefit of the covenant.

In Spencer’s Case, 1 Smith’s Leading Cases, p. 77, “It was resolved that the assignee of the assignee should have an action of covenant. So of the executors of the assignee of the assignee; so of the assignee of the executors or administrators of every assignee, for all are comprised within this word (assignees), for the same right which was in the testator, or intestate, shall go to his executors or administrators.” The bill in substance alleges that the plaintiff is the assignee of the leasehold interest or estate created by said lease. It was not necessary to allege all the circumstances tending to prove that fact. While “every material fact to which the plaintiff means to offer evidence ought to be distinctly stated in the premises; for otherwise he will not be permitted to offer or require any evidence of such fact.

A general charge or statement, however, of the matter of fact is sufficient; and it is not necessary to charge minutely all the circumstances which may conduce to prove the general charge; for these circumstances are properly matters of evidence, which need not be charged in order to let them in as proofs.” Story’s Equity Pleadings, Sec. 28 (5th Ed.); Miller’s Equity Procedure, Sec. 92; Phelps on Juridical Equity, Secs. 49, 55; Mewshaw v. Mewshaw, supra; Dennis v. Dennis, 15 Md. 73 . The covenant is, at the request, etc., of the lessees, “their heirs and assigns,” to convey to the lessees, their heirs and assigns, etc., yet the manifest intention of the parties to the lease, as gathered from the whole instrument, was to give to the lessees and those claiming under them, viz: “their executors, administrators and assigns,” the ¹⁵⁴ benefit of the covenant. This, however, is not an action at law for a breach of the covenant, and the doctrine of specific performance does not depend upon such technical distinctions. Wherever, and without regard to the form and technical character of the contract, performance of a covenant in respect to lands would have been decreed between the parties to it, it will, in the absence of controlling intervening equities, “be decreed as between persons claiming under them in privity of estate, or of representation, or of title.” 2 Story’s Eq., Secs.. 788-790, 714, 715, 791 (5th Ed.); Worthington v. Lee, supra.

(2) The second objection to the bill is that the plaintiff does not offer to bear the “cost and charge” of the conveyance of the fee to him, which, it is claimed, include a counsel fee to the defendants for the examination of plaintiff’s title in order to ascertain if he is legally entitled to the benefit, of the covenant. In the case of Oelrichs v. Spain, 15 Wall. 21 , the Court held that counsel fees were not recoverable in a suit on an injunction bond, the condition of which was to satisfy and pay “all costs, damages and charges” which should be occasioned by such writ of injunction, and said that the dis-allowance of such fees “rests on a solid foundation, and that the opposite rale is forbidden by the analogies of the law and sound public policy.” This ease was cited and relied on in Wood v. State, use of White, 66 Md. 61 , where, in a suit on an injunction bond, the Court held that the plaintiff could not recover fees paid counsel for procuring a dissolution of the injunction. In Johnson v. Glenn, 80 Md. 369 , a provision in a mortgage authorizing “the payment of all expenses incident to such sale,” was said to include services of an auctioneer, cost of advertising, etc., but not an allowance for commissions. Counsel fees “are not allowable” as costs “in the absence of a statute or in the absence of some agreement or stipulation specially authorizing the allowance thereof.” 11 Cyc. 104.

While parties must be left to contract as they please, in the absence of a clear undertaking to do so, one ¹⁵⁵ party to a contract should not he required to pay for services rendered for the benefit of the other, and whatever may have been held on the subject elsewhere, under the dcisions in this State the “cost and charge” which the plaintiff under the lease is required to pay, eannot be held to include a counsel fee to the defendants for examination of the plaintiff’s title. (3) The next ground of the demurrer is that the covenant to convey the fee to the lessees, “their heirs and assigns,” is not a covenant running with the land. In Glenn v. Canby, 24 Md. 127 , the Court stated as the established doctrine, “that a covenant to run with the land must extend to the land, so that the thing required to be done will affect the quality, value, or mode of enjoying the estaie conveyed, and thus constitute a condition annexed or appurtenant to it; there must also be a privity of estate between the contracting parties, and the covenant must be consistent with the