Monnett v. Railway.

said premises, were sold by said grantee; (3) that in consideration of an annual pass, plaintiff on September 21, 1897, released said condition to Felton, receiver; (4) that on May 16, 1895, and again on August 30, 1895, plaintiff sold, assigned and transferred to one David Rexroth all his rights under or by virtue of said condition.

Plaintiff by reply denies all the averments of the answer and further says that defendants repudiated said pass and deprived plaintiff of the benefits thereof.

The case was heard and submitted in this case upon the pleadings and the evidence.

Defendants did not urge here any claim based upon the petition to remove, or the motion to dismiss the action. However, they did not lose or impair their right to insist that the case has been lawfully removed into ⚫ the federal court by making defense in the common pleas, nor by appealing to this court. Powers v. Railway, 169 U. S. 92, 103 [18 Sup. Ct. Rep. 264; 42 L. Ed. 673]. The question is one of jurisdiction of the subject of the action and is here for determination, whether insisted upon by defendants or not.

Plaintiff's petition construed in the light of its prayer asserts two claims to relief against defendants: (1) The cancellation of certain writings evidential in their nature and material to the ultimate right claimed in the case, which writings are alleged to have been fraudulently obtained from plaintiff by Felton, receiver. (2) To quiet plaintiff's title or to declare a forfeiture in his favor to certain realty, color of title to which is vested in the defendant railroad company, and the legal custody of which without any other title or interest therein is held by the receiver defendant. The first claim involves no federal question. Gableman v. Railway, 179 U. S. 335, 339 [21 Sup. Ct. Rep. 171; 45 L. Ed. 220]. The second claim involved the title to the property. That title was in the railroad company if not forfeited, and in plaintiff here if it was forfeited. In no point of view was it in the receiver. The appointment of the receiver did not dissolve the corporation. It might be sued afterward as well as before, and while no decree or judgment rendered against the railroad company could operate to disturb the custody of the receiver or his management of the railroad property the decree or judgment otherwise and between the parties to the action would be valid and binding. The order of sale in the foreclosure suit in the federal court could not impair this validity.

The title of the railroad company to this realty was of record; the mortgagees acquired their interest with notice; the title of the mort gagees was no greater than the railroad company, the order of sale

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so far as the pleadings now show was likewise limited. The action then so far as the second claim is concerned and against the railroad company defendant involved no federal question and the controversy does not appear to be separable as to the defendant receiver even though it be assumed that the federal question was involved as to him. The court of common pleas in the first instance had, and this court on appeal now has, jurisdiction of the action, and the petition to remove is denied and the motion to dismiss the action is overruled.

At the trial the evidence was conflicting only as to the circumstances under which the writing of date September 21, 1897, purporting to be a release and satisfaction by plaintiff of the clause in the deed in question, was signed by plaintiff.

Plaintiff gave evidence tending to show that on two occasions prior to the transaction in question the railroad company or its receiver has given him a pass over the line and each time took a receipt for it; that these passes were given to compensate plaintiff for the railroad company's delay in complying with the requirements of the deed; that on September 21, 1897, Mr. McCune, an agent of the receiver came to him, tendered him a mileage book, remarking that as part of the receiver's red tape he would ask plaintiff to sign a receipt for it; that plaintiff thereupon stated that he could not read the document without his spectacles and he requested Mr. Weber, in whose restaurant or saloon the transaction took place, to procure spectacles for him and Weber after investigation said he could not; that upon McCune's assurance that the receipt was all right he signed the writing without reading or being able to read it; that in signing he believed it to be a receipt merely and that he had never in fact agreed to release said railroad company from any claim he had on account of said deed.

Defendants' evidence tended to show that the release was handed to plaintiff at the time without any statement as to its character; that plaintiff looked it over and appeared to be reading it, and after such examination he signed it, without any statement as to spectacles or any request to be supplied with the same; that it was not a mileage book but a pass that was handed to him at the time. Defendants do not deny that other passes had been given to plaintiff before that time and that more receipts were given by the plaintiff for them, and Mr. McCune says that he had no conversation with plaintiff as to an agreement to release, either before or at the time of this transaction, and it is not shown by defendants that any such agreement to release was ever made by plaintiff with any other person representing either the railroad company or the receiver unless signing the purported lease here in question

Monnett v. Railway.

amounted to such agreement. There is a sharp conflict in the evidence as to the part of the room at which the signature was written but none that the time was late in the afternoon.

From the issue of former passes, taking receipts for the same, the limited duration that the pass issued September 21, 1897, was to run and its comparatively insignificant value, the absence of any prior agreement to release and the absence of any discussion or conversation relating to a release at the time from the tenor of plaintiff's letter to McCune of date February 18, 1900, from which it appears that then for the first time plaintiff was informed that a release was claimed and from the apparently conceded fact that plaintiff at all times from September 21, 1897, asserted a claim against the company under the provisions of said deed, we are convinced that plaintiff's contention as to the facts is the very truth in the case. We so find and hold.

We are of opinion that plaintiff's failure to read the document which he signed will prove no obstacle to the relief which he seeks by way of cancellation and reformation. It is true that courts turn a deaf ear to a man who seeks to get rid of a contract solely on the ground that its terms are not what he supposed them to be. But courts will not refuse to listen; on the contrary they will give relief when a plaintiff charges fraud upon the defendant in reading the contract to him or in stating its nature or terms. Foster v. Mackinnon, 4 L. R. C. P. 704; Albany City Savings Inst. v. Burdick, 87 N. Y. 40, reviewing New York cases. Hawkins v. Hawkins, 50 Cal. 558; Schuylkill Co. v. Copley, 67 Pa. St. 386 [5 Am. Rep. 441]; Linington v. Strong, 111 Ill. 152; Moore v. Brown, 49 Iowa 130; Martindale v. Harris, 26 Ohio St. 379. This would obviously be true of cases in which the complaining party could not read. Kinney v. Ensminger, 87 Ala. 340 [6 So. Rep. 72], or could read only with difficulty, Keller v. Insurance Co. 28 Ind. 170. The presentation of this release for signature without previous discussion or agreement as to its terms, taken in connection with the previous pass transactions and in the other circumstances of the cases, amounted to a fraud upon plaintiff.

It is contended by defendants that plaintiff has transferred all his rights under the provisions of the deed in question to one Rexroth before the commencement of this action and that plaintiff cannot maintain this action. The evidence shows that at the date of the deed by plaintiff to the railroad company plaintiff was seized in fee of some 800 acres of land in a body situated near and perhaps surrounding the proposed site of the railroad station. A part of this land he contracted to convey to Rexroth. This contract dated May 16, 1895, among other things provides that Rexroth upon complying with the terms of sale "shall have the

Marion County.

benefit of the contract with the railway company so far as the same can be legally transferred to him." On August 30, 1895, the deed of conveyance from plaintiff to Rexroth being executed but not delivered because the consideration was not fully paid, the parties entered into a further contract as to the subject-matter of the conveyance and the use of the premises until the full payment was made by Rexroth. This contract of August 30, 1895, provides, "the farm scales on the farm are to go with it to Rexroth and become his property on the delivery of the deed. (The said scales are located on the railway lands.) The said John T. Monnett hereby assigns and transfers to said David Rexroth, the benefit of his contract with the Columbus & Sandusky Short Line Railway Company, as fully as the same can be legally transferred by him, all as provided in his written contract of sale of said lands."

This contract was not acknowledged and the deed of conveyance to Rexroth, it seems, contained no reference to the Short Line deed or the provision thereof here in question.

Plaintiff here contends that the provision of the Short Line deed create a condition subsequent. Defendants insist that it creates a covenant merely. We are of opinion that in any view it must be either one or the other. If now it be a condition subsequent only, the grantor and his heirs can take advantage of it. It is not legally transferable by the grantor by contract or conveyance. Schulenberg v. Harriman, 88 U. S. (21 Wall.) 44, 63 [22 L. Ed. 551]; Ruch v. Rock Island, 97 U. S. 693 [24 L. Ed. 1100]; 4 Kent's Commentaries 127; Co. Litt. 214a; Richardson v. Boynton, 94 Mass. (12 Allen) 138, 141 [90 Am. Dec. 141]. If the provision is a covenant it binds the assigns of the original grantee by its terms and it runs with the land held by the grantor at the time of making the Short Line deed. Avery v. Railway, 106 N. Y. 142, 154, 155 [12 N. E. Rep. 619]; Post v. Weil, 115 N. Y. 361, 376 [22 N. E. Rep. 145; 5 L. R. A. 122; 12 Am. St. Rep. 809]; Stillwater Tpk. Co. v. Coover, 25 Ohio St. 558, 560. If, however, it be a covenant in this sense it cannot exist independent of the conveyance of which it forms a part nor antedate the title to benefit which it exists. If then the provision be a condition subsequent the contracts with Rexroth are immaterial because the benefit of the condition was not legally transferable and Monnett agreed to transfer the benefit only if the same was legally possible and to the extent that it was legally possible. If the provision be a covenant then we assume that it cannot exist in gross, but runs with the land, passing, until released, as an incident upon the conveyance of the land for the benefit of which it exists and the date or transfer of the covenant being necessarily the same as the conveyance of title to the land benefited.

Monnett v. Railway.

Until the deed to Rexroth was delivered, he could have no benefit of the covenant, if it be such, passed to him, not by force of any contract but by virtue of the deed. Hence in this view the contract is also immaterial.

Whether the provision is in fact a condition or a covenant is, in the absence of a clause of forfeiture or of re-entry, a very difficult question to determine. Under such circumstances the same words may be used to create a condition as to create a covenant. Skinner v. Shepard, 130 Mass. 180. The question is one of intention of the parties, to be ascertained from the entire instrument and the circumstances, and not from technical language used. 4 Kent's Commentaries 132. Different courts upon language identical or similar have frequently differed in conclusions reached. In view of the difficulty of the question it is therefore a matter of relief to recognize and therefore to hold that in the present case it is a matter of no consequence whatever whether the language be held to create a covenant or a condition subsequent.

If it is a condition, the penalty for breach would be a forfeiture of the estate. It is elementary that a court of equity will never enforce a forfeiture by its affirmative action. "A court of equity sometimes relieves against forfeitures, but it is not the forum to which to resort to enforce them." Justice v. Lowe, 26 Ohio St. 372, 375.

In this case it is urged by plaintiff that the Short Line deed should be cancelled, not to enforce a forfeiture, but to quiet title of plaintiff to the lands in question or to remove a cloud from plaintiff's title. Plaintiff is not in possession of the land described in the Short Line deed. He claims no estate in remainder or reversion in said lands but an entire present estate in fee simple. Equity entertains jurisdiction of an action to quiet title by a plaintiff in possession, because by reason of his possession he cannot proceed at law against an adverse claimant. For similar reasons our statute gives to a plaintiff out of possession and who has or claims an estate or interest in reversion or remainder, an action to remove a cloud or quiet title against an adverse claimant. Section 5779 Rev. Stat. But this latter provision does not extend to one out of possession who claims the entire estate or a present right of possession merely. Raymond v. Railway, 57 Ohio St. 271 [48 N. E. Rep. 1093].

"As to whether possession by a plaintiff is necessary before he can resort to equity to remove a cloud, there appears to be some conflict of opinion, arising from loose statements of judges, and an overlooking of the principles of equity in regard to exercise of its jurisdiction. Where the estate or interest to be protected is equitable, the jurisdiction should be exercised whether plaintiff is in or out of possession, for under these circumstances legal remedies are not possible; but when