Introduction
Equitable relief is traditionally regarded as “Extraordinary,” and therefore, discretionary.
Differences Between Equity, Common Law Remedies, and Statutes
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Equity
o “It is hereby ordered that John Jones pay to Mary Jones the amount of $1000 per month
plus interests and costs.”
o Court actually directs a party to do something or refrain from doing something
o If John doesn’t pay the $1000 maintenance to Mary, John would be in contempt of
court.
o Mary can file a Petition for the Rule to Show Cause that would make John show cause
for the reason he should not be held in contempt. (This is not available when there is a
common law judgment unless/until there is an equity type proceeding.
o If John files a jury demand, he doesn’t have a right to a jury trial. A case in which an
equitable remedy is sought is not subject to state provisions that allow for jury trials,
and the 7th Amendment is only referring to common law cases, not equity cases.
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Common Law
o “Judgment B is hereby entered in favor of Plaintiff, John Jones, and against Defendant,
Peter Michaels, in the amount of $1000 plus interest and costs.”
o Just because you have a judgment doesn’t mean you have the money.
o A common law judgment merely declares that someone is obligated to do something; it
doesn’t direct the losing party to pay the winning party
o Money Damages
o Supplementary Proceedings
 If the Peter doesn’t pay the funds that are declared owed, the John has to follow
these proceedings to collect the money.
o In state civil cases, most states won’t provide a right to trial by jury unless one party asks
for a trial by jury.
Statutes
o In federal courts, the Seventh Amendment says a person has a right to trial by jury in
civil cases.
o In state cases, the individual state’s constitutions and statutes determine whether a
party has a right to trial by jury in a civil case.
In Illinois, any final order, no matter if it is equity or common law, is called a “judgment.”
The federal courts call a final order in an equity case a “decree.”
Riggs v. Palmer
No one shall be permitted to profit by his own fraud, or to take advantage of his own wrong, or to found
any claim upon his own iniquity, or to acquire property by his own crime. – Maxim.
Here, there was no certainty that his man would survive the testator, or that testator would not change the
will.
In re Covert
Where a victim’s will makes bequests to the wrongdoer’s family – innocent distributes – their status as
legatees under the victim’s will is not vitiated, and they are not disinherited by virtue of their family
relationship to the wrongdoer.
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1. The individual owned outright must pass through decedents’ respective will and into the residuary.
2. Joint tenant is entitled to an immediate one half interest in the joint property. Thus, his one half
interest is not forfeited. However, Riggs prevent Edward from profiting his own wrong doing. The joint
property should be divided evenly, half through Edward’s estate and half through K’s.
3. Insurance and pension plan proceeds must pass to their alternative beneficiaries. Insurance policy is
the contracts are to be construed according to the sense and meaning of the terms with the parties have
used. Neither party claims that the terms of the relevant instruments are deficient or ambiguous. The
insurance and pension funds were Edward’s own property both before and after K’s death. Because the
alternative beneficiaries are innocent distributes of his property, they are entitled to take pursuant to
the provisions of the respective instruments.
- Ct. said that Riggs are not applicable.
- Ct. said that innocent family cannot be denied.
- Ct distinguished 3 property.
1) individual owned outright:
2) joint tenant
3) Insurance and pension plan proceeds
Graf v. Hope Building Corp.
- Issue:
o Whether the ∏ is entitled to equity relief (foreclosure)?
- Dissent:
o Chief Judge Cardozo
 He felt the outcome was unconscionable
 Rule: Equity declines to treat a mortgage upon realty as a conveyance subject
to a condition, but views it as a lien irrespective of its form. (page 17)
 Rule: Equity declines to give effect to a covenant, however formal, whereby in
the making of a mortgage, the mortgagor abjures and surrenders the privilege
of redemption. (page 17)
 Rule: Equity declines to give effect to a covenant, improvident in its terms, for
the sale of an inheritance, but compels the buyer to exhibit an involuntary
charity if he is found to have taken advantage of the necessities of the seller.
(page 17)
 Rule: Equity declines to give effect to a covenant for liquidated damages if it is
so unconscionable in amount as to be equivalent in its substance to a provision
for a penalty. (page 17)
 Reread this dissent. He focused on it heavily.
Weinberger v. Romero-Barcelo
- Rule of law: An injunction should issue only where the intervention of a court of equity is essential in
order to protect property rights against injuries otherwise irremediable.
- Because Congress has not foreclosed the exercise of equitable discretion, the proper standard for
appellate review is whether the district court abused its discretion in denying an immediate cessation
order while the Navy applied for a permit.
- FWPCA itself provides for fines and criminal penalties.
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The History of Equity
Equity Acts in Personam
- means that equity can enforce its judgment through contempt remedy over Ds.
Equity could compel personal compliance; it could order D to do something that was foreclosed by
the law courts or not do something that was permitted by the law courts.
J.R. v. M.P
If judgment be given in an action at common law, the Chancellor cannot later or meddle with the
judgment, but he nay proceed against the persons for corrupt conscience, because he will take advantage
of the law against conscience.
- Chief Justice’s opinion:
The doctrine of res judicata is not applicable in this situation.
Obligation is not void because of the decision of the Chancery court.
But that does not mean that the obligation is invalid or valid.
B. The merger of law and equity
Grupo v. Alliance
Issue:
- Whether, in an action for money damages, a US district court has the power to issue a preliminary
injunction preventing the defendant from transferring assets in which no lien or equitable interest is
claimed.
No. Because such a remedy was historically unavailable from a court of equity, the court held that DC
had no authority to issue a PI preventing D from disposing of their assets pending adjudication of
respondents’ contract claim for money damages.
Strank v. Mercy Hospital of Johnstown (S.C. of Pennsylvania, 1955)
- writ of mandamus was denied.
- writ of mandamus could not issue to enforce a right or duty which was not imposed by law but rested
solely on contract.
- This was contract between the school and student.
- The court of equity have the jurisdiction not only for the prevention of acts contrary to law and
prejudicial to the rights of individuals, but also for the enforcement of obligations whether arising
under express contracts including those in which a duty may have resulted from long recognized and
established customs and usages, as in this case, between an educational institution and its student.
- In this case, the legal remedy is not adequate and complete, because the damage cannot be
formulated speculative and indeterminate.
- 1. Inadequacy remedy at law
2. irreparable harm
Recognition of Equity Decree at Law
Mutual Life Insurance Co. v. Newton (SC of New Jersey, 1888)
- On motion to strike out plea
- The declaration: first document filed by Π
- Δ gave mortgage lien on his real property for security for bond.
- Foreclosure of mortgage. The property was sold.
- The balance was $3877.
- Δ filed a plea (answer). Decreed by the court of chancery.
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- Decree (final order in equity case)
- deficiency is not money damage, it is equitable remedy.
- Δ said that there should be no cause of action remaining on him
- “This would be repeating!”
- Notes was signed along the mortgage all taken care of foreclosure proceedings.
- Res judicata!!! Will apply.
- Π filed the motion to strike out plea.
- Ct. agreed with the defendant.
- The doctrine of res judicata applies in decree by Chancery.
Res adjudicate – a cause of action once finally determined without appeal, between parties, on the
merits, by a competent tribunal, cannot afterwards be litigated by a new proceeding.
- The common law action was denied.
Bottom line: Foreclosure judgment in IL is final!!
Chauffeurs, Teamsters and Helpers, Local No. 391 v. Terry (SC, 1990)
Issue:
- Whether a employee who seeks relief in the form of backpay for a union’s alleged breach of its duty of
fair representation has a right to trial by jury.
- whether Π had a right to a jury trial in a duty of fair representation suit.
Holding: Yes.
- The first, the court compared 18th century action brought in the courts of England prior to the merger
of the court of law and equity.
- second, the court examined the remedy sought and determined whether it is legal or equitable in
nature.
A.
The action for breach of a union’s duty of fair representation was unknown in 18th century, so the court
looked any analogous action that existed in the 18th century.
The union contend that this action resemble a suit brought to vacate an arbitration award because Π
seek to set aside the result of the grievance process. In 18th century, the action was considered
equitable.
 The analogy is not appropriate. No grievance committee has considered respondent’s claim that the
Union violated its duty of fair representation. The process was concerned only with the employer’s
alleged breach of the collective bargaining agreement.
- Union next argue that this action is comparable to an action by a trust beneficiary against a trustee for
breach of fiduciary duty.
 The court found that this analogy is more persuasive. Just as a trustee must act in the best interests
of the beneficiaries, union must exercise its power to act on behalf of the employees in good
faith.
Respondent contend that this suit is less like a trust action than an attorney malpractice suit which was
action at law.
 This analogy is inadequate. Unlike employees represented by a union, a client control the significant
decision concerning his representation. Also, client can fire his attorney if he is dissatisfied with his
performance. This option is not available to employee.
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Even though the trust analogy was persuasive, it does not characterize respondent’s claim as wholly
equitable.
 However, The 7th amendment question depend on the nature of the issue to be tried rather than
the character of the overall action.
 To recover from the Union, Π must prove both that McLean violated §301 by breaching the
collective bargaining agreement and that the Union breached its duty of fair representation.
The duty of fair representation is analogous to a claim against a trustee for breach of fiduciary
duty. However, 301 issue is like a breach of contract claim which is legal issue.
 Π’s action contains both equitable and legal issues.
B.
In here, only remedy sought is a request for compensatory damages representing backpay and benefits.
An action for money damage was the traditional form of relief offered on the court of laws. There are
exceptions.
1. damages are equitable where they are restitutionary such as in action for disgorgement of impoper
profits. The backpay is not money wrongfully held by the union. It is not restitutional.
2. a monetary award incidental to or interwinded with injunctive relief may be equitable
- Union argue that the back pay must be equitable because The court labeled backpay awarded under
title VII of the civil rights Act as equitable.
 Congress specifically characterized backpay under Title VII as a form of equitable relief, but
Congress made no simiar pronouncement regarding the duty of fair representation.
 The court held that the remedy of backpay sought in this action is legal in nature.
 Although the search for an adequate 18th century analog revealed that the claim include both legal
and equitable issues, the money damages respondent seek are the type of relief traditionally awarded
by courts of law. Thus, 7th amendment entitles respondents to a jury trial.
Justice Brennan Cocurring
- He agree that remedy is legal in nature and that 7th amendment entitles respondent to a jury trial.
Disagree with historial test, because this court discounted the significance of the analogous form of
action for deciding where 7th amendment applies.
- He would decide solely on the basis of the relief sought.
- For the past decade, the court has explained that two part of the historical test are not equal in weight,
, that the nature of the remedy is more important than the nature of the right. He would decide 7th
amendment questions on the basis of the relief sought.
- In addition, modern statutory rights did not exist in the 18th century and even the most exacting
historical research may not elicit a clear historical analog.
- The right at issue in here is a creature of modern labor law was not existed in England.
Power of Courts of Equity
A. Enforcement of Equitable Decrees
1. Notice
The Cape May v. Johnson
Ds are before the court on a charge of contempt.
Rule – while an order of a court remains in force it must be obeyed, it must nevertheless be respected
until it is annulled by the proper authority.
Where the charge is that the D has willfully contemned the authority of the court, all that need be shown
is that he knew of the existence of the order at the time he violated it.
Lord Eldon held that if a D is in a court when an injunction is granted, he has sufficient notice of it to
make it his duty to respect it. He also held that if the D is not in court when an order for an injunction is
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made, but is informed that such an order has been made, by a person who was in court when the order
was made, he sufficient notice of the injunction to render him liable to punishment for its breach.
2. Persons Bound by the Decree
Lord Wellesley v. Earl of Mornington
Rule – where a party assaults an officer of the court in the discharge of his duty; or displaces a receiver;
or interfere with the execution of its process; or obstructs or interferes with the due course of justice; the
court interferes and punishes for the contempt.
Rigas v. Livingston
Rule – persons not parties to the action may be bound by an injunction if they have knowledge of it,
provided they are servants or agents of the Ds, or act in collusion or combination with them. Persons,
however, who are not connected in any way with the parties to the action, are not restrained by the order
of the court. It was held that a stranger to the restraining orders of the court was in no way affected by or
bound to obey them.
United Pharmacal Corp. v. US
US filed a complaint against Metabolic for a temporary and permanent injunction restraining them from
introducing a drug into interstate commerce on the ground that the drug was misbranded. The court issued
a PI. Certified copies of this decree were served on United Pharmacal, which had a contractual
relationship with Metabolic. United sued for declaratory judgment that it was not bound by the PI. While
this suit is pending, United sent the drug in interstate commerce to a customer.
Civil Procedure 65(d) – “every order granting an injunction is binding only upon the parties to the action,
their officers, agents, servants, employees, and attorneys, and upon those persons in active concert or
participation with them who receive actual notice of the order by.”
Rule: when a person not a party may be punished, is when he abet the D or he is legally identified with
him.
US v. Hall
Issue was whether the court has power to punish for criminal contempt a person who, though neither a
party nor bearing any legal relationship to a party, violates a court order designed to protect the court’s
judgment in a school desegregation case.
Rule – Court had the inherent power to protect its ability to render a binding judgment between the
original parties to the Mims litigation by issuing an interim ex parte order against an undefinable class of
persons. Also, the court held that willful violation of that order by one having notice of it constitutes
criminal contempt.
3. The Duty to Obey: The Collateral Bar Rule
The “collateral bar rule” prohibits many legal challenges to the validity of the order by one who is
charged with violating the order. The rule is ordinarily limited to criminal contempts.
It requires that a party comply with the order if the party wishes to challenge the validity of the order.
US v. United Mine Workers of America
“An injunction duly issuing out of a court of general jurisdiction with equity powers must be obeyed by
them until its decision is reversed for error by orderly review by courts. Disobedience of them is contempt
of its lawful authority to be punished.”
Walker v. City of Birmingham
TRO was granted. But Ds engaged in anyway. D defend on the ground of constitutionality of city
ordinance. But the court refused to allow D’s constitutional claim because of the collateral bar rule.
Because Ds had violated the TRO, they could not challenge its constitutional validity.
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- Even if the injunction order is violation of the due process, state court have the authority to hold the
contempt for violation of the injunction.
- Once court entered injunction, you have to comply with it.
- otherwise, you have to file a motion to dissolve the injunction order.
Mine workers and Walker reinforce the proposition that an order issued by a court with jurisdiction over
the subject matter and the person must be obeyed until it is reversed, modified, or dissolved by orderly
and proper proceedings. Failure to obey such an order may result in contempt sanctions.
4. Contempt
Contempt is a manifestation of the power of a court to protect itself and its orders.
Contempt generally arises in one of two setting.
(1) a party may act disrespectfully toward a judicial body or engage in act that constitute the
obstruction of justice
(2) a party may disobey a judicial order.
A contempt finding is criminal if its primary effect is to punish
A contempt finding is civil if its primary effect is remedial.
The fact that the sanction is payable to the P as compensation for his damage is a factor that usually leads
the court to characterize the contempt as civil.
On the other hand, if the fine is unconditionally payable to the court, this is seen as criminal.
International Union v. Bagwell
Company obtained a comprehensive injunction addressing many of the violent acts that were occurring
during the strike and containing a schedule of escalating fines if there were future violations of the
injunction. The injunction was violated on many occasions. Due to escalating fines in the injunction, the
fine ultimately aggregated over 60M. The parties then settled the dispute and ended the strike. The trial
court vacated the fines payable to the company, but did not vacate the fines payable to the counties and
state. The trial court levied a conditional fine that the union could avoid by complying with the injunction.
In this sense, the violation of the injunction looked like a case of coercive civil contempt. On the other
hand, the injunction itself was quite detailed in terms of the type of conduct it prohibited and the level of
fine that would be imposed. Once the injunction was violated, the sanction was uniform and fixed for the
violation. Lastly, the fine was paid to the government. In this sense, the violation of the injunction looked
like a case of criminal contempt.
The court reversed the fine because the contempt was deemed “criminal” and the union had not been
provided process appropriate to a criminal proceeding.
Broad holding – All fixed, determinate fines are criminal sanctions notwithstanding the ability to avoid
the sanction by complying with the order or to purge the sanction by bringing oneself into
compliance with the order.
Narrow holding – The decision is limited to cases involving ongoing disputes and complex transactions
that the court attempts to regulate and control by an injunction that prescribes a detailed code of
conduct.
In Re Yengo
Direct contempt – judge may act summarily without notice or order to show cause
Indirect contempt – the proceeding shall be on notice and order to show cause
The essence of a direct contempt, or contempt in the fact of the court, is conduct that a judge can
determine through his own senses is offensive and that tends to obstruct the justice. Generally, a
disruptive act in the presence of the court, such as the use of offensive words or conduct, is a direct
contempt. However, an act may be a direct contempt although it is not committed in the presence of the
court. (threatening letter from attorney to the clerk)
Indirect contempt – is an act committed not in the presence of the court.
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Attorney’s unexcused absence ?  Generally indirect
If the attorney explain adequately, then can be indirect.
However, attorney refuses to explain, it could be direct.
- The characterization of the contempt as direct or indirect should be deferred until after the attorney has
an opportunity to explain his absence.
Pounders v. Watson
Summary contempt order – “to preserve order in the court room for the proper conduct of business, the
court must act instantly to suppress disturbance or violence or physical obstruction or disrespect to the
court when occurring in open court. There is no need of evidence or assistance of counsel before
punishment, because the court had seen the offense. Such summary vindication of the court’s dignity and
authority is necessary. It has always been so in the courts of the common law and the punishment
imposed is due process of law.”
Habeas corpus is a legal action, or writ, through which a person can seek relief from the
unlawful detention of him or herself, or of another person. It protects the individual from
harming him or herself, or from being harmed by the judicial system. The writ of habeas
corpus has historically been an important instrument for the safeguarding of individual
freedom against arbitrary state action.
5. Writs of Assistance
Hamilton v. Nakai
All Writs Act – “The Supreme Courts and all courts established by Act of Congress may issue all writs
necessary or appropriate in aid of their respective jurisdictions and agreeable to the usages and
principles of law.”
(1) necessity – They allege that the Navajo have denied to the Hopi the joint use and benefit of the
property and that US, as trustee and guardian of the property, has neglected its duty to see that the
original decree was effectively implemented.
(2) Appropriate – once jurisdiction has attached, powers under Act should be broadly construed. Every
court has the inherent power to enforce its judgment and decrees. The All Writ statute appears as a
congressional reaffirmation of that power.
(3) agreeable to the usages and principles of law – In prior case, court did not direct that joint possession
of the joint use area be delivered to the Hopi, but the court did quiet their title as co-tenants. In this
situation, a writ of assistance is “agreeable to the usages and principles of law.” – the power of the
court to issue the judicial writ, or to make the order, and enforce the same by a writ of assistance,
rests upon the obvious principle that the power of the court to afford a remedy must be co-extensive
with its jurisdiction over the subject matter. Where the court possesses jurisdiction to make a decree,
it possesses the power to enforce its execution.
6. Writs of Sequestration
Shaw v. Wright
7. Execution of Decrees for Money
Reeves v. Crownshield
793 of the Civil Act provides that the court may make an order directing a judgment debtor to make
payments in installments out of the income which he receives. Such orders must be made upon notice to
the judgment debtor and after he has had an opportunity to show inability to pay, and with due regard to
the reasonable requirements of the judgment debtor and his family.
8. Enforcement of Decrees “In Rem”
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Garfein v. McInnis
Vendor: Conneticut (has not personally served in NY, has been personally served in Connecticut)
Vendee: NY
Property: NY
Court: NY
“A court of equity may by constructive service, in accordance with statute, acquire jurisdiction over a
non-resident in an action for SP whenever it has power, whether granted by statute or inherent, to make a
decree which will result directly, or through conveyance by an officer, in the transfer of title or interest in
land.”
Holding: the court may grant a judgment which will operate upon the property itself and result in a
transfer of the title to a successful party though the D fail or refuse to obey a command of the judgment
directed to him.
B. Decrees as to Foreign Property
1. Conveyances of Foreign Land
Penn v. Lord Baltimore
- The K was in England
- The parties were in England.
- The case is filed in England.
- The court did not have the jurisdiction for land. No in rem jurisdiction.
- This court did not need to have the jurisdiction in rem.
- The court can order SP and enforce it.
- If the party disobey, and never come back to country, then take the decree to send to the America.
2. Extraterritorial Effect of Decrees for Conveyance
Deschenes v. Tallman
“A judgment of a foreign court will not avail of its own force to transfer the title to land located in this
State. It will not avail though a conveyance be executed by the sheriff or a master or other agent of the
court in fulfillment of its mandate.”
“But the rule is different where the conveyance is executed by the owner, though he act under
compulsion. The conveyance, and not the judgment, is then the source of title.”
- Rule: The distinction is between a judgment directed against the res itself, and one directed against the
person of the owner, who acts upon the res.
Burnley v. Stevenson
When a decree rendered by a court in sister state, having jurisdiction of the parties and of the subject
matter, is offered as evidence, or pleaded as the foundation of a right, in any action in the courts of this
state, it is entitled to the same force and effect which it had in the state where it was pronounced. True,
the courts of this state can not enforce the performance of that decree, by compelling the conveyance
through its process of attachment; but when pleaded in our courts as a cause of action, or as a ground
of defense, it must be regarded as conclusive of all the rights and equities which were adjudicated and
settled therein, unless it be impeached for fraud.
McElreath v. McElreath
The trial court and the Court of Appeals treated the decree as being one which directly affected the title
to Texas lands. This court regard it as being an equitable order operating in personam which orders
husband to execute a deed conveying land in Texas to wife. As so construed, the OK decree should be
enforced as a matter of comity.
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“The doctrine that jurisdiction respecting lands in a foreign state is not in rem, but one in personam, is
bereft of all practical force, if the decree in personam is conclusive and must be enforced by the courts
of the situs.”
“As a matter of comity we will enforce the equitable decrees of a sister state affecting Texas land so long
as such enforcement does not contravene an established public policy in this state.
Under the Full Faith and Credit Clause, a final judgment in a civil action at law must be recognized by the
courts of sister states.
3. Foreclosure and Partition
Wimer v. Wimer
Issue – Has a court in Virginia, when Ds have appeared and answered, jurisdiction to partition lands, the
major part of which lies within another state?
No. The court of chancery in Virginia has no jurisdiction to decree partition of lands in another state.
General rule – no writ of sequestration, or execution, or any order, judgment or decree of a foreign
court, can be directly enforced against real estate situate without the limits of the foreign state.
“Decree of the foreign court does not directly affect the land, but operate upon the person of the D, and
compel him to execute the conveyance, and it is the conveyance which has the effect, and not the
decree. If, however, the relief asked cannot be administered by a decree in personam, without going
further and acting upon the land, the court will refuse to entertain the bill.”
C. Injunctions against Foreign Suits
1. Grounds for Issuance
Kaepa, Inc v. Achilles Corp
Issue – whether DC erred by enjoining D corp from prosecuting an action that it filed in Japan as P, which
essentially mirrored a lawsuit previously filed by P Kaepa.
This court granted the antisuit injunction.
This court concluded that a DC does not abuse its discretion by issuing an antisuit injunction when it has
determined that allowing simultaneous prosecution of the same action in a foreign forum thousands of
miles away would result in “inequitable hardship” and tend to frustrate and delay the speedy and efficient
determination of the cause.
D’s argument
(1) DC failed to give proper deference to principles of international comity.
(2) DC erred by failing to meet several requirements of FRCP 65 before issuing injunction.
- notice – if no factual dispute is involved, no oral hearing is required; under such circumstances the
parties need only be given “ample opportunity to present their respective views of the legal issues.”
- posting a bond – is a matter for the discretion of the trial court.
2. Effect of Injunctions against Suit
James v. Grand Trunk Western Railroad Co.
Issue – whether IL court having prior jurisdiction of a wrongful death action instituted by a nonresident P,
must recognize an out-of-state injunction restraining the P from proceeding with that action; and whether
IL court, to protect its jurisdiction of the wrongful death action, may issue a counter injunction restraining
D from enforcing its injunction against P in the state of her residence.
- The IL court does not require to recognize the Michigan injunction.
- This court is free to disregard such out of state injunctions, and to adjudicate the merits of the pending
action, also, the court can protect its jurisdiction from such usurpation by the issuance of a counter
injunction restraining the enforcement of the out of state injunction.
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D. State Court Injunctions against Federal Court Proceedings
Donovan v. City of Dallas
Issue – whether a state court can validly enjoin a person from prosecuting an action in personam in a
district or appellate court of the US which has jurisdiction both of the parties and of the subject matter.
General rule – state and federal courts would not interfere with or try to restrain each other’s
proceedings. An exception has been made in cases where a court has custody of property, that is,
proceeding in rem or quasi in rem. In such cases this court has said that the state or federal court having
custody of such property has exclusive jurisdiction to proceed.
“Where the judgment sought is strictly in personam, both state and federal court, having concurrent
jurisdiction, may proceed with the litigation at least until judgment is obtained in one of them which
may be set up as res judicata in the order.”
Here, that right was granted by Congress and cannot be taken away by the State. The Texas courts were
without power to take away this federal right by contempt proceedings or otherwise.
E. Federal Court Injunctions against State Court Proceedings
Younger v. Harris
“Court of equity should not act, and particularly should not act to restrain a criminal prosecution, when
the moving party has an adequate remedy at law and will not suffer irreparable injury if denied
equitable relief. Certain types of injury, in particular, the cost, anxiety, and inconvenience of having to
defend against a single criminal prosecution, could not, by themselves be considered ‘irreparable’ in the
special legal sense of that term.”
General rule – “A court of US may not grant an injunction to stay proceedings in s State court except as
expressly authorized by Act of Congress, or where necessary in aid of its jurisdiction, or to protect or
effectuate its judgments.”
Exceptions)
(1) except as expressly authorized by Act of Congress
(2) to protect or effectuate its judgment
(3) where a person about to be prosecuted in a state court can show that he will, of the proceeding
in the state court is not enjoined, suffer irreparable damages.
When absolutely necessary for protection of constitutional rights, courts of US have power to enjoin
state officers from instituting criminal actions. But this may not be done, except under extraordinary
circumstances, where the danger of irreparable loss is both great and immediate.
Federal injunctions against state criminal statutes, either in their entirety or with respect to their
separate and distinct prohibitions, are not to be granted as a matter of course, even if such statutes are
unconstitutional.
Here, the possible unconstitutionality of a statute “on its face” does not in itself justify an injunction
against good-faith attempts to enforce it, and that Harris has failed to make any showing of bad faith,
harassment, or any other unusual circumstance that would call for equitable relief.
Rule:
- A federal court must not intervene by way of either injunction or declaration in an existing criminal
prosecution. Such circumstances only exist when there is a threat of irreparable injury “both great and
immediate.”
- A threat of this nature might be shown of the state criminal statute in question were patently and
fragrantly unconstitutional on its face, or if there has been bad faith and harassment in a statute’s
enforcement.
Exceptions include criminal prosecution
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(1) brought in bad faith
(2) for purposes of official harassment, or
(3) based on statutes that are “patently and flagrantly unconstitutional
O’Shea v. Littleton
Cairo class action – discriminatory official’s behavior to black
The complaint failed to satisfy the threshold requirement imposed by Art. III – actual case or
controversy.
Abstract injury is not enough. It must be alleged that P has sustained or is immediately in danger of
sustaining some direct injury as the result of the challenged statute or official conduct. The injury or
threat of injury must be both “real and immediate,” not “conjectural” or “hypothetical.”
A federal court should not intervene to establish the basis for future intervention that would be so
intrusive and unworkable.
Huffman v. Pursue
Issue – Whether decision in Younger bars federal district court from intervening in a state civil
proceedings such as this, when the proceeding is based on a state statute believed by the district court
to be unconstitutional.
The component of Younger which rests upon the threat to our Federal system is thus applicable to a civil
proceeding such as this quite as much as it is to a criminal proceeding.
While in this case, the DC’s injunction has not directly disrupted Ohio’s criminal justice system, it has
disrupted that State’s efforts to protect the very interests which underlie its criminal laws and to obtain
compliance with precisely the standards which are embodied in its criminal laws.
Younger, and its civil counterpart which we apply today, do of course allow intervention in those case
where DC properly finds that the state proceeding is motivated by a desire to harass or is conducted in
bad faith, or where the challenged statute is “flagrantly and patently violative of express constitutional
prohibitions in every clause, sentence and paragraph, and in whatever manner and against whomever
an effort might be made to apply it.
Rizzo v. Goode
- because pattern of illegal and unconstitutional mistreatment by police officer, the class action was
sought against Δ, Mayor, the city managing director, and police commissioner.
- DC entered order requiring Δs to submit to the court for its approval a comprehensive program for
improving the handling of citizen complaints alleging police misconduct.
- The court of Appeal upheld that equitable relief.
- Δ claims that the judgment of DC represents an unwarranted intrusion by the federal judiciary into the
discretionary authority committed to them by state and local law to perform their official functions.
- S.C. agree with Δs.
there was no affirmative link between the occurrence of the various incidents of police misconduct and
the adoption of any plan showing their authorization or approval of such misconduct.
- Only causal connection found by DC between Δ and Π was that in the absence of a change in police
disciplinary procedures, the incidents were likely to continue to cuur, not with respect to them, but as to
the members of the classes they represented.
Missouri v. Jenkins
MO state has challenged the DC’s order of salary increases for virtually all instructional and
noninstructional staff within the Kansas city and DC’s order requiring the State to continue to fund
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remedial “quality education” programs because student achievement levels were still at or below
national norms at many grade levels.
(1) The remedy must therefore be related to “the condition alleged to offend the Constitution.
(2) The decree must indeed be remedial in nature, that is, it must be designed as nearly as possible ‘to
restore the victims of discriminatory conduct to the position they would have occupied in the
absence of such conduct.
(3) The federal courts in devising a remedy must take into account the interests of state and local
authorities in managing their own affairs, consistent with the Constitution.
Ultimate inquiry is whether the constitutional violator has complied in good faith with the desegregation
decree since it was entered, and whether the vestiges of past discrimination have been eliminated to
the extent practicable.
“Federal court decrees exceed appropriate limits if they are aimed at eliminating a condition that does
not violate the Constitution or does not flow from such a violation.”
F. Injunctions and Decrees as to foreign Acts
The Salton Sea Cases
The injury charged in the present case was an injury to property within the jurisdiction of the court, and
the party charged with the commission of the injury was also within the jurisdiction of the court. The
cause of the injury was not serving a useful purpose for any one, and the relief asked for was that the
party causing the injury might be enjoined from continuing to injure property within the jurisdiction of
the court.
Here, the court had jurisdiction to protect within its jurisdiction, and to restrain the D from diverting the
waters of the Colorado river to the damage of such property, notwithstanding the D may find it
necessary in complying with the decrees of the court to perform acts beyond the jurisdiction of the
court.
Madden v. Rosseter
Here, P ask for a mandatory injunction requiring D to ship horse to K as provided in the agreement; also
for a receiver of the horse with power to proceed to CA and to take appropriate steps, including the
invoking of the aid of the courts of that or any other state to gain possession of the animal and ship.
“The courts of sister states may be relied upon to aid in serving the ends of justice whenever our own
process falls short of effectiveness.”
The Injunctions
Injunctions – in personam order by the court to a D, to do or to refrain from doing something.
To preserve the status quo pending litigation, or to prevent a threatened injury.
A. Interlocutory Injunctions
Hughes v. Cristofane
Ps are owner of the restaurant. P seek a temporary restraining order enjoining enforcement of a
recently enacted city ordinance which prohibits topless dancing.
In order to obtain relief by TRO, P must show:
(1) that unless the restraining order issues, they will suffer irreparable harm;
(2) that the hardship they will suffer absent the order outweighs any hardship Ds would suffer of the
order were to issue;
(3) that they are likely to succeed on the merits of their claims;
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(4) that the issuance of the order will cause no substantial harm to the public; and
(5) that they have no adequate remedy at law.
Here, (1) without TRO, P would suffer irreparable harm both to financial interests and their interest in
the free exercise of constitutional rights. Other courts found that loss of revenue, when specifically
described, constitutes irreparable harm. Also, P have made an adequate showing that without TRO, the
law might operate to infringe the first and fourteenth amendment freedoms not only of P, but also of
other entertainers. Such a showing satisfies not only the irreparable harm but also the likelihood of
success requirement. (2) If TRO should issue, the only resulting hardship on D will be a return to the
status qui before the ordinance took effect. Because D have not shown that the status quo injured
anything other than their moral sensibilities, the court feels that the importance of the P’s constitutional
rights outweighs the D’s interests. (4) For the same reason, the court finds that enjoining the
enforcement of ordinance will not substantially harm the public interest. (5) P also have no adequate
remedy at law.
(a) Preliminary Injunction – No preliminary injunction shall be issued without notice to the adverse
party.
(b) Temporary Restraining Order – TRO may be granted without written or oral notice to the adverse
party or his attorney only if
(1) it clearly appears from specific facts shown by affidavits or by the verified complaint that
immediate and irreparable injury, loss, or damage will result to the applicant before the
adverse party or his attorney can be heard in opposition, and
(2) the applicant’s attorney certifies to the court in writing the efforts, if any, which have been
made to give the notice and the reasons supporting his claim that notice should not be
required.
(c) Security – No TRO or preliminary injunction shall issue except upon the giving of security by the
applicant for the payment of such costs and damages as may be incurred or suffered by any
party who is found to have been wrongfully enjoined or restrained. No such security shall be
required of the US or of an officer or agency thereof.
- TRO, unlike PI, are generally not appealable.
Abbott Lab v. Mead
Abbott sought PI. A party seeking a PI must demonstrate
(1) some likelihood of succeeding on the merits, and
(2) that it has “no adequate remedy at law and will suffer irreparable harm if PI is denied.
If the moving party cannot establish these requirement, then court’s inquiry is over.
If the moving party clearly establish these requirements, the court must consider
(3) the irreparable harm the non-moving party will suffer if PI is granted, balancing that harm against the
irreparable harm to the moving party if relief is denied; and
(4) the public interest, meaning the consequences of granting or denying the injunction to non parties.
(1) Abbott need only demonstrate some likelihood of prevailing on the merits, not that it will definitely
prevail.
(2) It would be very difficult distinguish the effect of the campaign from the effect of other factors
causing consumers to purchase Ricelyte, and to protect that effect into the distant future. This
difficulty would appear to render monetary relief inadequate, and hence Abbott’s injury irreparable.
(3) Public interest – Some forms of intermediate relief, such as ordering Mead to purge the false aspects
of its promotional campaign and issue corrective advertising, would leave Ricelyte, a viable
competitor. In fact, such relief would serve, rather than disserve, the public interest.
(4) There are less severe remedy for Mead
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Coyne v. Capital Development Board
A P awarded temporary injunctive relief is usually required to obtain a bond. These bond requirement
serves two functions. First, it provides a secure source of funds from which a wrongfully enjoined D may
collect damages. Second, in most jurisdictions it caps the amount of damages that can be collected from
the P when the D is wrongfully enjoined.
General rule – Wrongfully enjoined D is limited to the bond for all damages caused by the injunction.
A D may appeal the bond amount.
“A D’s inability to obtain damages in excess of the bond unless P was acting in bad faith can have
unfortunate results, which are well illustrated by this case where the DC required too small a bond. But a
D dissatisfied with the amount of bond set by the DC can, on appeal from the PI, ask the court of appeals
to increase the bond, which the D here did not so. Since P is conceded to have brought this suit in good
faith, D is not entitled to any damages above $5000 fixed in the bond.”
B. Mandatory Injunctions
Vane v. Lord Barnard
The court granted an injunction to stay committing of waste and decreed not only the injunction to
continue but that the castle should be repaired, and put into the same condition it was.
Cooling v. Security Trust Co.
The bill prayed for a mandatory preliminary injunction directing the D trustee to file in the court
exceptions to the final account filed by it as a coexecutor of the estate of Cooling and also to file
exceptions to all other accounts to which written notice has not been received of the filing.
“Only by the issuance of the mandatory preliminary injunction could it be assured that a possible trust
asset would not be lost here. When such a showing is made, I feel that this court has the power and the
duty to issue an appropriate injunction.”
US v. Price
A request for funds for a diagnostic study of the public health threat posed by the continuing
contamination and its abatement is not a traditional form of damages. The funding of a study would be
preventive rather than compensatory.
The appropriateness of issuing a mandatory preliminary injunction in a case in which the status quo “is a
condition not of rest, but of action.”
The fact of the present case show clearly that the status quo is a condition of action which, if allowed to
continue or proceed unchecked and unrestrained, will inflict serious irreparable injury.
Therefore, mandatory PI is appropriate.
In CBS, the court stated that “Although courts are rarely called upon to issue mandatory injunctions
calling for the payment of moneys pendente lite, they have done so when the equities and the
circumstances of the case demonstrated the appropriateness of the remedy.”
Friends for All Children v. Lockhead Aircraft
DC entered a mandatory injunction pendent lite. The injunction ordered Lockhead to create a $450,000
fund from which reasonable expense of diagnostic examinations would be paid.
Sims rule should not rigidly be erected as an absolute bar to a limited intervention by equity designed to
prevent irreparable harm in those circumstances where, as here, D’s liability has already been determined
through stipulation or partial summary judgment prior to trial.
General rule (Sims) – Court should not entertain interim equitable relief when a remedy at law – money
damages – is deemed adequate to provide final relief in the P’s action.
In Price, DC had refused to grant a PI which would have ordered a company to provide funds for a
diagnostic study of the environmental hazards to the water supply created by company’s landfill, because
interim equitable relief that granted monetary damages was in its view inappropriate. The Third Circuit
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affirmed the DC but rejected its rationale. The court noted that funds for study were not a traditional form
of compensatory damages but rather a first step in a remedial process designed to prevent serious
irreparable injury. Similarly in the instant case, the funds for examinations do not simply represent
compensation for past injury, but are require to prevent future injury.
Held: PI requiring the D to create a fund to pay for diagnostic exams is proper when the D has been held
liable for the cost of such examinations and when the delay inherent in trying the case to compute the
amount of the D’s liability will result in irreparable injury. Moreover, P must show that they meet the
traditional standards governing the award of equitable relief, and the DC must seek to minimize the
prospect that a P will receive any funds that a trier of fact will subsequently fail to award.
C. Specificity
An injunction must be “specific and definite” if it is to be enforceable.
The principle is that injunctions should be construed narrowly in order to make sure that persons who are
subject to them have clear notice as to what the injunction requires them to do or not do.
Collins v. Wayne Iron Works
“It is a notice that certain things must be done or not done. Such a decree should be as definite, clear and
precise in its terms as possible, so that there may be no reason or excuse for misunderstanding or
disobeying it.”
Here, only safe way to comply with the decree would be to entirely stop the running of its machine.
Here, Court modified the injunction order to stop machine from 7am to 7pm.
Schmidt v. Lessard
P filed this suit on behalf of herself and all other persons 18yrs or older who were being held involuntarily
pursuant to the Wisconsin involuntary commitment laws, alleging that the statutory scheme was violative
of the Due Process Clause.
D.C. declared the statute unconstitutional. It simply said that “it is ordered and adjudged that judgment be
and hereby is entered in accordance with the opinion heretofore entered.”
FRCP provide that “Every order granting an injunction and every restraining order shall set forth the
reasons for its issuance; shall be specific in terms; shall describe in reasonable detail, and not by reference
to the complaint or other document, the act or acts sought to be restrained.”
 The order here falls far short of satisfying the second and third clauses of rule. Neither the brief
judgment order nor the accompanying opinion is specific in outlining the terms of the injunctive relief
granted; nor can it be said that the order describes in reasonable detain…the act or acts sought to be
restrained.”
The rule was designed to prevent uncertainty and confusion on the part of those faced with injunctive
orders, and to avoid the possible founding of a contempt citation on a decree too vague to be understood.
Since an injunctive order prohibits conduct under threat of judicial punishment, basic fairness requires
that those enjoined receive explicit notice of precisely what conduct is outlawed.
D. Modification or Dissolution
An injunction is subject to modification when it would no longer be fair or just to require continued
obedience to the existing terms of the injunction.
Ladner v. Siegel
A final decree in such equitable proceeding is unchangeable except possibly through gross mistake to be
corrected by a bill of review, and not then if any intervening right has appeared since entering the decree.
In all such proceedings the decree calls for definite action and the law presumes such action to follow the
order.
Rule – The modification of a decree in a preventive injunction is inherent in the court which granted it,
and may be made (a) if, in its discretion judicially exercised, it believes the ends of justice would be
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served by a modification, and (b) where the law, common or statutory, has changed, been modified or
extended, and (c) where there is a change in the controlling facts on which the injunction rested.
Two bills
(1) bill of review – was available when the moving party could show new matter or error apparent in the
decree.
(2) bill in the nature of a bill of review – would lie when the movant could show that the decree had been
obtained by fraud, mistake, or duress.
Emergency Hospital of Easton v. Stevens
After the injunction was granted to P, Hospital changed the bylaws, so that it could avoid the injunction.
It is true that a final decree will not be opened to relitigate any question dealt with in it by the court
passing such a decree, but that rule does not mean that, where events have occurred since the decree
which would necessarily make the continuance of the injunction an absurdity, or unjust or oppressive, that
the court which granted it could not in a proper proceeding change its decree to conform to the changed
conditions.
Board of Education of Oklahoma City v. Dowell
Board of education sought dissolution of a decree imposing a school desegregation plan.
DC granted relief. The court of appeals reversed. It relied upon language from US v. Swift for the
proposition that a desegregation decree could not be lifted or modified absent a showing of “grievous
wrong evoked by new and unforeseen conditions.” It also held that “compliance alone cannot become the
basis for modifying or dissolving an injunction.” This court held that its reliance was mistaken.
In the present case, a finding by DC that the Oklahoma city school district was being operated in
compliance with the commands of the equal protection clause of the 14th amendment, and that it was
unlikely that the school board would return to its formal ways, would be a finding that the purposes of the
desegregation litigation had been fully achieved. No additional showing of “grievous wrong evoked by
new and unforeseen conditions” is required of the school board.
In Milliken, the court said that “Federal court decrees must directly address and relate to the constitutional
violation itself. Because of this inherent limitation upon federal judicial authority, federal court decrees
exceed appropriate limits if they are aimed at eliminating a condition that does not violate the
Constitution or does not flow from such a violation.”
Such decrees, unlike the one if Swift, are not intended to operate in perpetuity.
Dissolving a desegregation decree after the local authorities have operated in compliance with it for a
reasonable period of time properly recognizes that “necessary concern for the important values of local
control of public school systems dictates that a federal court’s regulatory control of such systems not
extend beyond the time required to remedy the effects of past intentional discrimination.
DC should address itself to whether the Board had complied in good faith with the decree since it
was entered, and whether the vestiges of past discrimination had been eliminated to the extent
practicable.
F. Noncoercive Ancillary Remedies: Maters, Receivers, and Accounting
Hurst v. Papierz
This court held that the appointment of a receiver and the imposition of the complained of temporary
injunctions were proper in this case. It is reasonable to fear that there is a dander in this case that the
property which belongs to the joint venture may be placed beyond the jurisdiction of the court or in some
way involved in transfers, conveyances or subjected to other claims, so as to render it more difficult for
the court to give and enforce final relief to which counterclaimant may be found entitled to at the
conclusion of the accounting.
Note on accounting, maters and receivers
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- An accounting is an audit conducted to ascertain the amount of money that one party owes to another.
It is a form of relief ancillary to a decree for the payment of money.
Traditionally, equity was also willing to grant an accounting in at least some circumstances where the
accounts between the parties were deemed too complex for a jury to understand.
- Court of equity frequently appoint a master or receiver to facilitate their work. Master have been
appointed to assist chancellors in a number of ways. They have been used, for example, to conduct
hearings and investigations, make determinations of fact or law, recommend appropriate sanctions,
verify accounts, determine the value of the property, and compute damages.
- Receivers are appointed to manage property. Because a receiver is an officer of the appointing court, the
law considers the appointing court to be the true possessor of property within the receiver’s custody.
Consequently, any improper interference with or attempt to disturb the receiver’s possession may be
punishable as contempt.
The Declaratory Judgment and Related Remedies
A. Quia Timet Relief
Fletcher v. Bealey
P expected certain injury in the future. It is admitted that the action is brought, not to obtain damages for
past injury, but to prevent that which is feared as a future injury, or, to use the more technical expression,
the action is a quia timet action.
(1) There must be, if no actual damage is proved, proof of imminent danger
(2) There must also be proof that the apprehended damage will, if it comes, be very substantial; and
(3) I should almost say it must be proved that it will be irreparable.
 Here, the danger is not imminent, because it must be some yrs before any such quantity of the liquid
will be found issuing from the heap as would pollute the Irwell to the detriment of the P. And, in the next
place, if any such quantity of liquid did get into the river so as to injure the P, the court think that it
would be discovered immediately, and it would be perfectly possible for him them to apply to the court
for relief, and to obtain an immediate injunction restraining the D.
Escrow Agent’s Fidelity Corp v. Abelman
Quia timet is an action for equitable relief against an anticipated injury.
“No principle in equity is more familiar, or more firmly established, than that a surety, after the debt for
which he is liable has become due, without paying or being called on to pay it, may file a bill in equity in
the nature of a bill quia timet to compel the principal to exonerate him from liability by its payment,
provided no rights of the creditor are prejudiced thereby.”
Quia timet allows the surety to prevent the principal from dissipating those funds if the surety knowsit
will be called upon to “pay the debt or perform the obligation” on the bond, suspects that the principal has
some or all of the necessary funds to do so, and fears that the principal may abscond with those funds.
B. Bills of Peace
Yuba Consolidated Gold Fields v. Kilkeary
P filed a complaint in the nature of “bill of peace” seeking to avoid a multiplicity of legal actions by
determining in one equity suit the liability asserted in hundreds of claims for damages resulting from
floods. Π filed a suit to enjoin the Δs from the prosecution of any suit for the recovery of any damages
have been caused by the flood.
“Equity jurisdiction in this class of cases will not be recognized unless there is a common bond or interest
held by the number of persons against the single person.”
There is no dispute that common questions of law and fact must exist before a court of equity will
interfere. The question is whether in addition to common questions of law and fact there must exist a
common title or community right or interest in the subject matter among the Ds. Answer is no. It is
sufficient that where there is merely a community of interest among them on the questions of law and
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fact involved in the general controversy, or in the kind and form of relief demanded and obtained by or
against each individual member.
Where equity jurisdiction to entertain a bill of peace is authorized, the question of whether it will be
exercised rests in the sound discretion of the chancellor.
C. Bills to Quiet or Remove a Cloud on Title
Wathen v. Brown
The object of a bill to quiet title is to protect the owner of legal title “from being disturbed in his
possession and from being harassed by suits in regard to his title by persons setting up unjust and illegal
pretensions.
“one being in possession, he cannot have a remedy at law and is obliged therefore to seek the aid of a
court of equity. If, however, the possession is in another person, his remedy is by action of ejectment, and
there is no ground for the interposition of a court of equity, and for reason that he has an adequate remedy
at law.”
“Court have held that where a P has the legal title to lands that are wild, uncultivated and unoccupied, he
may invoke the aid of a court of equity to remove a cloud upon his title, although he has no other than
constructive possession resulting from legal ownership.”
Presumably then, if actual possession is not alleged in the Bill of Complaint although title is claimed, the
bill is demurrable unless it is alleged that the lands are vacant and unoccupied.
Therefore, absent actual or constructive possession, appellee could not bring appellant, who claimed
possession adversely, into court to defeat his claim to title.
To entitle the P to relief in such cases, 3 are required.
(1) he must have been in possession of the property
(2) he must have been disturbed in its possession by repeated actions at law; and
(3) he must have established his right by successive judgment in his favor.
Limitation of bill to quiet – it gave no relief to anyone whose claim of title had not been challenged at
law.
Today, IL has statute “forcible entry or detainer”
- take away the possession by that party.
D. Interpleader
State Farm Fire v. Tashire
Federal interpleader was not intended to serve the function of a “bill of peace” in the context of multiparty
litigation arising out of a mass tort, of the anomalous power which such a construction of the statute
would give the stakeholder, and of the thrust of the statute and the purpose it was intended to serve, we
hold that the interpleader statute did not authorize the injunction entered in the present case.
In the widest sense, the applicant who brings interpleader relief in the nature of quia timet (the fear of
being subjected to double litigation, and possibly made to pay twice for the one liability.) The applicant is
basically a D who takes the initiative to determine to whom the obligation is properly owed.
Specific Performance of Contracts
A. Contracts for the Sale or Lease of Property
1. Adequacy of Legal Remedies
Eastern Rolling Mill Co. v. Michlovitz (output contracts)
D, Eastern Mill co, agreed to supply P with bundle steel scrap for 5 yrs.
P were to accept delivery of the scrap as it accumulated.
D’ president is dead and new president induced the p to agree to a rescission of the K.
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P brought a bill to enforce specifically the K.
“Contracts for the delivery of goods will be specifically enforced, when by their terms the deliveries are
to be made and the purchase price paid in installments running through a considerable number of yrs.
Such K are differ from those that are immediately to be executed.” Their profits depending upon future
events, cannot be estimated in present damages, which must, of necessity, be almost wholly conjectural.
 Under the cases, the right to specific performance turns upon whether the Ps can be properly
compensated at law.
The scrap is not to be delivered according to specified tonnage, but as accumulates, so the quantity vary
from quarter to quarter.
- The price was not fixed upon the K, the price change according to two specified materials on
Philadelpia market whose quarterly prices are accepted as the standard.
- The K runs to Sep 30th 1932.
- Jury would not determine the future quarterly tonnage, the quarterly K prices, and market price.
- Any estimate would be speculative.
Kitchen v. Herring (land sale K)
Rule:
- Land is assumed to have a peculiar value, so as to give an equity for a SP, without reference to its
quality or quantity,
- Land is assumed to have peculiar value, there is a equitable to have SP.
- The court will generally grant SP in the land transaction.
The restatement of contracts 360
Contracts for the sale of land – A specific tract of land has long been regarded as unique and impossible
of duplication by the use of any amount of money. Furthermore, the value of land is to some extent
speculative. Damages have therefore been regarded as inadequate to enforce a duty to transfer an
interest in land.
Van Wagner Advertising Corp. v. S &M Enterprises (wall lease contract)
By agreement, Michaels leased to plaintiff, Van Wagner advertising the space on the wall of a certain
building.
Uniqueness does not guqrantee the SP.
Here, trial correctly concluded that the value of the space could be fixed with reasonable certainty and
without imposing an unacceptably high risk of undercompensation.
The value of commercial billboard space can be determined by comparisons with similar uses – Van has
more than 400 leases. It cannot be regarded as speculative.
Restatement of Contracts 360
In determining whether the remedy in damages would be adequate, the following circumstances are
significant:
(a)
The difficulty of proving damages with reasonable certainty
(b)
The difficulty of procuring a suitable performance by means of money awarded as
damages, and
(c)
The likelihood that an award of damages could not be colleceted
Rubinstein v. Rubinstein
Holding:
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- Nothing in the language of the K explicitly states that the liquidated damages provision was to be his
sole remedy.
Rule:
- A liquidated damages provision will not bar the remedy of SP.
There must be something more, such as explicit language in the K that the liquidated damages
provision was to be the sole remedy.
- Liquidated damage clause: in the event of breach, the parties agree that damages are liquidated by this
amounts.
- Two requirements: (IL)
1. damages must be difficult to ascertain
2. amount must under all the circumstance be reasonable, not be substantially more than actual
damages would have been.
- There is balancing. IL enforce liquidated damage clause when it satisfied.
- Here, parties did not say that this liquidation clause would bar SP.
2. Relief for and against Third Persons
Liabilities of Purchaser’s Assignee
Langel v. Betz
- Plaintiff was vendor, defendant was assignee.
- The issue was whether SP has to be enforced where vendor obtain SP of K for the sale of real estate
against the assignee of the vendee, where the assignee merely requests and obtain an extension of
time within which to close title.
- Rule: Mere assignment of a bilateral executor contract may not be interpreted as a promise by the
assignee to the assignor to assume the performance of the assignor’s duties, so as to have the effect of
creating a new liability on the part of the assignee to the other party to the contract assigned.
- The assignee of the vendor is under no personal engagement to the vendor where there is no privity
between them. The assignee, however, expressly or impliedly, bind himself to perform the assignor’s
duties where the assignee of the vendee invoke the aid of a court of equity in an action for SP, he
impliedly binds himself to perform on his part and subject himself to the condition of the judgment.
Novation:
John owed mortgage loan to first national bank.
John will sell the property to Michael.
John want to assign the liability to Michael.
John want to off the liability.
If John assigns his responsibility to Michael, the bank has two people for responsible payment.
In this case, John has to make novation (three way agreement)
Bank agree to accept that Michael is sole obligor.
Absent of novation, the bank still has the right under Michael and John.
- Here, there was no novation.
- Absent of that kind of agreement, what is assigned is the right, but not a obligation.
Distinction between assignment of right and delegation of the duties
3. Devolution on Death – Equitable conversion
Rights between Vendor and Purchaser
Taylor v. Kelly
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- Rule: where there is K for the sale of land, the vendee is considered in Equity as the owner, and the
vendor retains the title as a security for the purchase money.
- Where a trustee converts the fund, beneficiary has a right to follow the fund and take it in its changed
shape.
- Beneficiary takes entirely his benefit from legal owner, trustee.
- Equitable owner: beneficiary, not the owner of legal title
- owner of equitable title, beneficiary, also called cestui que use.
- Equitable conversion: the owner of legal title treated as trustee.
- Constructive trust doctrine also can be used in here.
- Different kind of equitable conversion involving in probate matter.
Title to real estate automatically goes to heir at law.
Personal property goes to individual’s estate.
4. Risk of Loss, Compensation and Abatement
Skelly Oil Co. v. Ashmore
Skelly contracted to buy land from Ashmores.
A building on the land, which Skelly intended to demolish, was destroyed by fire before the closing date.
Ashmore received $10,000 insurance policy.
Skelly sought SP with a $10,000 abatement in the price.
The trial gave it this relief and Ashmores appeals.
Rule:
- Sale K will no longer be binding if the building are destroyed by fire and “the value of the building
constitutes a large part of the total value of the estate, and the terms of the agreement show that
they constituted an important part of the subject matter of the K.”
- If the change in the value of the estate is not so great, or if it appears that the building did not
constitute so material a part of the estate to be conveyed as to result in an K, SP may be decreed,
with compensation for any breach of agreement, or relief may be given in damages. (Mass’s rule)
Here, plaintiff can enforce SP and he can abate $10,000.
Dissent:
- The MJ should have remanded the case for a determination of the amount of actual damages suffered
by Skelly or the compensation to which it is entitled if it still wants SP.
- If Equitable conversion doctrine applies, vendor has legal title for trustee, vendee is the equitable
owner.
Who bear the risk of loss? Vendee bear the risk of loss, because they owned equitable ownership.
- But here, MJ did not apply traditional equitable conversion theory.
Ultimately, they choose one of the theory that Skelly has the right to SP and abatement of $10,000.
- Now, the purchaser who is the beneficiary of the trust has the right to SP against the vendor who is the
trustee under the traditional theory.
Dixon Salvation Army
- Dixon and Salvation army entered a real estate purchase and sale K.
- SA agree to sell K and J property.
- One of two building on K was destroyed by fire.
- SA received $240,000 insurance policy.
- Dixon sought and obtained a court declaration that total price should be abated to reflect loss.
- SA requested that K should be rescinded.
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- Since neither title nor possession had passed to Dixon, SA had the risk of loss. This rule prohibits the SA
from enforcing K and permits Dixon to rescind. The statute is silent whether Dixon can specifically
enforce K.
Rule:
- Where there is a mere agreement to sell, and title has not passed, the loss falls on the vendor. The
vendor is excused from the performance of his contract but he cannot retain money already paid.
- It would be unfair to require either party to accept consideration less than the whole of what was
bargained for.
- If it is unfair to enforce the purchaser to receive materially damaged property, it is equally unfair to
compel the vendor to accept a price substantially below what he bargained for.
- Here, Dixon cannot enforce specifically the contract.
Uniform Land Transactions Act 2-406(b)
(b) In case if a casualty loss or taking by eminent domain while the risk is on the seller:
(1) if the loss or taking results in a substantial failure of the real estate to conform to the K, the buyer
may cancel the K and recover any portion of the price he has paid, or accept the real estate with his
choice of (i) a reduction of the K price equal to the decrease in fair market value caused by the loss
or taking, or (ii) the benefit of the seller’s insurance coverage or the eminent domain payment for
the loss or taking, but without further right against the seller; or
(2) if the real estate substantially conforms to the K after the loss or taking, the buyer must accept the
real estate, but is entitled to his choice of (i) a reduction of the K price equal to the decrease in fair
market value caused by the loss or taking or (ii) the benefit of the seller’s insurance coverage or the
eminent domain payment with respect to the loss or taking but without further right against the
seller.
Billy Williams v. Hillerich
Hillerich sued Williams for SP of a K to convey a house and a lot, for damages growing out of the
defective construction of the house and for damaged due to delay.
Restatement – “A contracts to transfer land to B and also to make certain repairs and to complete an
unfinished building on the land. In case of repudiation by A, B may be given a decree for SP, with an
abatement in the price or other compensation sufficient in amount to enable to him to make the repairs
and complete the building himself.”
Thompson on Real Property – “Whether the vendor or purchaser is the P there are three alternatives
presented when the vendor is able to give only a performance nonconforming in quantity, quality, or
value:
(1)
To refuse the remedy of SP
(2)
To enforce the K without any regard to the partial failure
(3)
To decree a conveyance and allow the vendee an abatement from price equal to the
value of the deficiency in the performance.
The court held that vendee may have “specific performance as to such title as the vendor can furnish,
and may also have a just abatement from the purchase money for the deficiency of title or quantity or
quality of the estate.
If money damage is for same thing which would given by SP, then you can’t get both.
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This case show that we can get both SP and money damage when one may be entitled to SP of a K to
purchase real estate and damages for delay in performance.
Where the common law actions for damages were found inadequate to afford a full remedy, SP is
applied.
B. Contracts to Build or Repair
Lane v. Newdigate
Bill is sought for equitable relief.
- This court grants an injunction that indirectly forces D to do repair.
I can enter the equitable order which has that effect.
- Court entered the order that “prohibiting from impeding.”
-This is prohibitory injunction.
- Mandatory injunction is order to do something
Prohibitory injunction is order to not do something.
Jones v. Parker
- The lessor “covenants to deliver possession of the same to the lessee upon completion of building, and
thereafter, during the term of this lease, reasonably to heat and light the demised premises.”
- It is alleged that the building has been completed, but that the defendants refuse to complete the
premises with apparatus sufficient to heat and light the same.
- P pray for SP of the covenant and for damages.
- SP should be decreed.
- There is no universal rule that courts of equity never will enforce a K which requires some building to
be done.
- Demurrer overruled.
- D argue that court can’t order repair.
Court is saying that it is was common law remedy action, jury would easily determine.
So, “I can make that determination.”
- Impracticability – whether ct should grant this kind of order because judge should have supervise, then
it is impracticable.
- The doctrine of impracticability is implied in here.
City Stores Co. v. Ammerman
- Developers wanted to build a shopping center.
- In exchange for City Stores’ help in getting the property rezoned, the developers promised to give it
the opportunity to become one of the center’s major tenants with rental and terms at least equal to
that of any other major department store in the center.
- City Store helped and the land was rezoned, but developers did not offer to lease space to City Store.
- City brought an action for SP.
Issue:
- Whether a court of equity will grant SP of a K which has left substantial terms open for future
negotiation.
Holding – As a matter of law that the mere fact that a K contains some terms which are subject to
further negotiation between P and D will not bar a decree for SP, if in the court’s discretion SP
should be granted.
Issue 2 – whether K which call for construction of a building can or should be specifically enforced.
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Rule – Such K should be specifically enforced unless the difficulties of supervision outweigh the
importance of SP to the P.
C. Contracts for Personal Services
De Rivafinoli v. Corsetti
D had entered into K with another to go to the Havana as an opera singer and to be there on the same
day.
- The bill prayed for SP of the K with P; that D might be decreed to sing, gesticulate, and recite according
to his agreement; that he might be restrained from leaving the state.
- There might be some difficulty to figure out whether D performed his engagement according to its
spirit and intend even if SP is granted.
- It also difficult for the court to determine what effect coercion might produce upon D’s performance
Ct generally not grant SP for personal service contracts.
2. Negative Contracts
Lumley v. Wagner
The bill prayed that Wagner might be restrained from violating any breach of the K; that Wagner might
be restrained from singing and performing at the Royal.
The court has granted an injunction prohibiting the commission of an act in respect of which the court
could never have interfered by way of specific performance
- This is personal service contract. (Ct are reluctant to enforce SP in this K)
- P sought to be inforced actual promise. (not to sing at any other place)
- This is negative K provision.
- Ct granted it.
- Only the negative restrains was sought.
Ticor Title Insurance Co. v. Cohen (covenant not to compete)
Facts:
- P are title insurance company.
- D, Cohen, was employed by P as a insurance saleman.
- His client were real estate attorney,
- Ticor and Cohen entered into an Employment K on Oct 1, 1995.
It included the covenant not to compete.
It was until Dec 1999, although Cohen could terminate it without casue.
The non-compete provision provide that until 180 days following his termination, he would not engage
in the business of Titla insurance in the state of NY.
It defined title insurance as the sale, service, or rental of any product, process of service of Ticor which
had been developed, sold or offered for sale by Ticor in the NY state.
- On April, 1998, a direct competitot of Ticor, TitleServ offered to employ Cohen.
TitleServ agreed to indemnify Cohen by paying him a salary during the six months period in the event
that the covenant not to compete was enforced.
Ticor commenced this action on June 1998. And applied for a TRO and preliminary injunctions.
- DC entered a TRO.
- After further discovery, DC extened TRO for additional 10 days.
- Thereafter, DC ordered permanently enjoining Cohen from working in the title insurance business and
from appropriating Ticor’s corporate opportunities with its current or prospective customers for a 6
months.
- Trial held that an injunction was justified to protect Ticor’s confidential info.
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It ruled that Cohen had breached his fiduciary duty to Ticor because he had expressly asked one client
to follow him to TitleServ, and he had inquired of others if they would be willing to follow him.
This court affirmed.
I. Injunctive Relief
- This order is subject to reversal only for an abuse of discretion or for a clear error of law.
- Basic requirements are showing of irreparable injury and inadequacy of legal remedy.
 Here, there is irreparable harm.
- Difficult to calculate the monetary damage for loss of relationship with client.
- In the K, it was admission by Cohen that P will suffer irreparable harm if he were to breach the K,
because K provide that Ticor shall be entitlted to injunctive relief.
- In NY law, cases in the covenant not to compete assume an irreparable injury to P.
II. Covenant not to compete
- The issue of whether a restrictive covenant not to compete is enforceable depends on whether the
covenant is reasonable in time and geographic area.
- Court balance the need to protect employer’s legitimate business interest against the employee’s
concern the possible loss of livelihood,
- Early NY court observed that K in partial restraint of trade are permitted.
Assuming, a covenant survived by first reasonableness, enforcement will be granted to the extent
necessary
(1) to prevent employee’s solicitation or disclosure of trade secret
(2) to prevent employee’s release of confidential info regarding the customers.
(3) in those cases where the employee’s service to the employer are deemed special or unique.
 Reasonableness test are met because the duration of covenant was short and the scope was not
geographically overbroad.
B. Unique Service
- Reasonable and uniqueness  injunction is granted.
- Unique service – where the services are depend on employee’s special talent
- It is not necessary that the employee should be the only star of his employer, or that the business will
fail if he leaves.
- Inquiry is more focused on employee’s relationship to the business than on the individual person of
the employee.
- Maltby v. Harlow Meyer Savage, Inc. – S.C. of NY found that currency traders were unique employees
because they unique relationships with the customers.
- DC found that this case is similar with Maltby case, and granted the injunction.
- All of Cohen’s clients came to him during his time at Ticor and were developed at Ticor’s expense.
- One half of his client came from other salesman.
- Cohen maintained these relationships by use of the substantial entertainment expense provided by
Ticor.
- 1997, he spend $170,000 entertaining clients and in the five months of 1998, he spent about
$138,000.
- Trial found that Cohen’s relationship with client was special.
1. since the costs and terms of title insurance in NY are fixed by law, competition for business rely
heavily on personal relationship.
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2. since potential clients are limited and well known throughout the industry, maintaining current
clients from this group is crucial.
3. Cohen had negotiated his K with his attorney, not from inferior bargaining power.
- Cohen argued that Maltby case is distinguishable because in that case, the employee were paid their
base salary during restricted period, but Cohen did not receive.
- The significance of the salary paid in Maltiby was that it helped his livelihood, but here, part of
Cohen’s $600,000 per year salary was in exchange for his promise not to compete for 6 months
after termination, and since the employer had given Cohen sufficient funds to sustain him for 6
months, the public policy concern regarding impairment of earning a livelihood was meritless.
 no abuse of dicretion.
Rule: Where the employee’s services are special, unique, or extraordinary. Then injunctive relief is
available to enforce a covenant not to compete, if the covenant is reasonable, and even though
competition does not involve disclosure of trade secrets or confidential lists.
- An employer has sufficient interest in retaining present customers to support an employee covenant
where the employee’s relationship with the customers is such that there is a substantial risk that the
employee may be able to divert all or part of the business.
 Here, this risk was clearly evidenced by the fact that in 1997 another employee, Clarke, left Ticor for
TitleServ and took 75 percent of his clients with him.
- Non-compete K provision here.
- DC held that there should be injunction to protect P’s confidential information.
It granted permanent injunction.
- Sale of title insurance is unique?
- He was paid very large amount.
Rogers v. Runfola
Issue: whether the covenant not to compete contained in appellees’ employment K are reasonable in
light of the guideline pronounced by in Raimonde v. Van Vlerah.
- Court reporter filed declaratory judgment action challenging validity of covenants not to compete in
employment K.
- Employer counterclaimed, seeking SP of covenants, injunctive relief and damages.
- Trial court held in favor of employees.
- Court of Appeal affirmed.
In Raimonde, the court said that
1. A covenant not to compete which imposes unreasonable restrictions upon employee will be enforced
to the extent necessary to protect an employer’s legitimate interests.
2. A covenant restraining an employee from competing with his former employer upon termination of
employment is reasonable if the restraint is no greater than is required for the protection of the
employer, does not impose undue hardship on the employee, and is not injurious to the public.
Factors:
- Whether employee represents the sole contact with the customers.
- whether employee is possessed with confidential info or trade secret.
- whether the covenant seeks to eliminate competition which would be unfair to the employer or
merely seeks to eliminate ordinary competition.
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- whether the covenant seeks to stifle the inherent skill and experience of the employe
- whether the benefit to the employer is disproportional to the detriment to the employee.
- whether the covenant operates as a bar to the employee’s sole means of support.
- whether the employee’s talent which the employer seeks to suppress was actually developed during
the period of employment
- whether the forbidden employment is merely incidental to the main employment.
 This ct concluded that the restraint hardship on employee exceed that which is reasonable to protect
employer’s legitimate interest.
- Geographically, they are prohibited from engaging in court reporting for two yrs.
- are also restricted for a lifetime, from soliciting or diverting any of employer’s client
 Court reporting is unique profession.
 Imposing such time and space restrictions is unreasonable and will create undue hardship on
employee.
- Inquiry does not end. Need to determine whether some restrictions are necessary to protect
employer’s business interest.
- Employer played a large role in employee’s development as successful court reporter.
- While employer by company, employees gained valuable experience.
- Employer invested time and money in equipment.
- Balancing the restraint with employer’s interest
 Ct modify the restrictions as to space and time.
- Soon after trial judgment, employees started a court reporting business and still in operation.
- Employer requests that the court enjoin employees from engaging in competitive activities and that
the court remand the case to the trial on the issue of damage.
- Employees urged to the court to follow Moraine Industrial Supply v, Sterling case and find that an
injunction would be extremely harsh.
- balance the factors, Ct. concluded that grant employer the relief sought in part.
In Raimonde, this court held it was entirely proper for a trial court to enjoin an employee who breached
a covenant not to compete for 3 yrs from the date of the court’s order.
 This court hold that employees shall 60 days from the date of this order, be prohibited for a period of
1 yr from engaging in court reporting within the city limits of Columbia, Ohio
- Ct. balanced the factors. Then, granted the injunction in part.
- too Broad  ct strike it!!
Many court are applying blue pencil test.
BDO Seidman v. Hirshberg
- BDO was accounting firm.
- D was employee of the BDO and was promoted to the manager position.
- AS a condition of receiving the promotion, he was required to sign management agreement.
- D agreed that if, within 18 months following the his employment termination, he served any former
client of BDO, he would compensate BDO “:for the loss and damages suffered” in an amount equal
to one and one half times the fees BDO had charged.
- Oct 1993, he resigned from BDO.
- Then, BDO brought an action on Jan 1995.
- BDO alleged that they lost 100 former client who were billed a total $138,000 in the yr D left the firm.
- The court apply 3 part test
A covenant is reasonable only if it
(1) is no greater than is required for the protection of the letigimate interest of the employer.
(2) does not impose undue hardship on the employee
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(3) is not injurious to the public.
- With agreement not to compete between professionals, the court have given greater weight to the
interest of the employer because unique or extraordinary service.
- BDO contend that accountant is learned profession. 
 Not here,
- BDO is a national accounting firm seeking to enforce the agreement within a market consisting of
the entirety of a major metropolitan area.
- D’s status in the firm was not based upon the uniqueness but major part on his ability was attract a
client.
- No evidence to show D had unique ability as accountant.
(1) covenant is overbroad in some respects.
- BDO claims that the legitimate interest is its entire client base, however, the only justification for
imposing an employee agreement not to compete is to forestall unfair competition.
- However, employee may fairy compete without unfair means.
- If employee abstains from unfair means, the employer’s interest in preserving its client base is no
more legitimate.
- Legal scholars and courts have more circumspectly identifies the employer’s legitimate interest in
employee anti-competitive agreements than that of preservation of the employer’s entire client
base where, there is no evidence that the employee obtained a competitive advantage by using
confidential info.
- The employer has a legitimate interest in preventing former employees from exploiting or
appropriating the goodwill of a client, which had been created at employer’s expense.
 Extending the anti- competitive covenant to BDO’s client with whom a relationship with D did not
develop through assignments to perform direct, substantive accounting services would violate the
first test.
 It is greater than is needed to protect legitimate interest.
 To the extent that requires D to compensate for lost patronage of clients whom he never acquired a
relationship through the direct provision of substantive accounting services during his employment,
the covenant is invalid and unenforceable.
 Because the goodwill of those clients was not acquired through the expenditure of BDO’s resource,
the firm has no legitimate interest.
- Except for the overbreadth, the restriction does not violate the common law test for reasonableness.
- time – 18 months
- place – to clients of Buffalo office
- This court grant partial enforcement for overbroad covenant
When the enforceable portion is not an essential part of the agreed exchange, court should conduct
focusing on the conduct of the employer.
- if employer demonstrate an absence of overreaching, coercive use of dominant bargaining power but
has in good faith partial enforcement may be justified.
 Here, covenant was not imposed as a condition of D’s employment but in commection with
promotion of a position,
- There is no evidence of coercive mean
 here, only change is to narrow the class of clients to which covenant apply.
Damage,
- D does not dispute that at least some clients to which the covenant validly apply were served by him,
P is entitled to partial summary judgment on the issue of liability.
- The provision represent a liquidate damages clause
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- Liquidate damages clause is valid if the damage are difficult to ascertain and the amount is a
reasonable measure of the anticipated harm.
- if amount fixed is plainly disproportionate to the loss, it will not be enforced.
 Damage here are sufficiently difficult to ascertain
For the second element, P relied upon the affidavit of managing partner in firm that “the amount of
liquidated damage was tied to a commonly accepted way of valuing a client account of a
professional service from as an asset.”
 However, it does not demonstrate any absence of gross disproportionality.
Therefore, the court should remit for further consideration.
Post v. Merrill
- Merrill Lynch employed Post and Maney as account executives at its office.
- Both elected to be paid a salary and to participate pension and profit sharing plan.
- After 15 yrs, both were terminated without cause.
- They began working for Bache company which was competitor of Lynch.
- 15 months after their termination, P requested their pension but D refused and said that it was
forfeited pursuant to provision of the plan which permitted forfeiture in the event that employee
directly or indirectly competed with the firm.
- P brought the actions against Lynch for conversion and breach of K to recover their pension plan and
for punitive damage.
- Appellate division granted D’s motion for summary judgment and dismissed the com.
It relied on Kristt case.
In that case. The court held that “it is not unreasonable restriction of the liberty of a man to earn his
living if he may be relieved of the restriction by forfeiting a contract right or by adhering to the
provisions of the K. The provision for forfeiture here involved did not bar P from other employment. HE
had the choice of preserving his rights under the trust by refraining from competition.”
Rule:
- where an employee is involuntarily discharged by his employer without cause and thereafter enter into
competition with his former employer, and where the employer based on such competition, would
forfeit the pension benefit earned by his former employer, such a forfeiture is unreasonable as matter
of law cannot stand.
- where the employer terminates the employment relationship without cause, however, his action
necessarily destroys the mutuality of obligation on which the covenant rests as well as the employer’s
ability to impose a forfeiture. An employer should not be permitted to use offensively an
anticompetition clause coupled with a forfeiture provision to economically cripple a former employee
and simultaneously deny other potential employers his services.
If Employee discharged with cause, the court would say that this provision can be enforced.
- If employee simply resign from company voluntarily, the court would say that this forfeiture clause can
be enforced under Kristt.
- Kristt held that it is no unreasonable restriction of the liberty of a man to earn his living if he may
relieved of the restrictions by forfeiting a K right or by adhereing to the provisions of his K.
- With cause or without cause?
- ERISA law also applies here.
E. Contracts for Arbitration
Grayson-Robinson Store v. Iris corp.
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(K for arbitration)
- S.P of a K to construct a building.
- Issue: Whether arbitration award which decree SP of the same kind of agreement can be granted.
- Ct. said that arbitration award in here will be granted.
- The only ground suggested for such a refusal is that confirmation would involve the court in
supervision of a complex and extended construction contract. This court hold that this apprehension or
speculation is no deterrent to confirmation by the courts.
- There is no universal rule that courts of equity never will enforce a K which requires some building to
be done.
- This K contains provision about specific authority which was conferred to the arbitrator.
Dissent:
- The decision in present case lends the enforcement machinery of the courts to implement SP directed
by arbitration that extends beyond any equitable relief which the courts have heretofore granted
either on arbitrations or after trial.
Sprinzen v. Nomberg
- Issue: whether an arbitrator’s award which enforces the terms of a restrictive covenant of employment
is unenforceable as being contrary to public policy.
- Special Term confirmed the award.
- On Appeal, appellate division vacated the award.
- The court of appeal reversed the decision of the appellate division.
- It confirmed the award. Arbitrator was right.
- An arbitrator’s responsibility is to reach an equitable result and the court will not assume the role of
oversees to mold the award to conform to their sense of justice.. Thus, a arbitrator’s award will not be
vacated for errors of law and fact committed by the arbitrator and even where the arbitrator states in
intention to apply a law, and then misapplies it, the award will not be set aside.
- In certain case, arbitrator has more power than courts.
- Here, the court held that disputes involving restrictive covenants of employment can be, by mutual
consent of the parties, submitted to arbitration, and an arbitrator’s award which specifically enforces
such covenants, even to the extent of enjoining an individual from engaging in like employment for a
reasonable period of yrs in the future, will not be vacated on public policy grounds.
- If the restrictive covenant is found, under all the circumstances, to be “reasonable in time and area,
necessary to protect the employer’s legitimate interests, not harmful to the general public and not
unreasonably burdensome to the employee”, it will be subject to specific enforcement.
- This court held that the arbitrator had the power to pass upon the issue of both the reasonableness
and the necessity of the restrictions imposed upon the employee.
Equitable Relief against Tortious Interference with Land and Chattels
A. Waste
Earl Bathhurst v. Burden
- P filed the bill against his lessee, D, to keep the fish pond in repair (mandatory), and be restrained by
injunction from obstructing them, and from erecting any further buildings (prohibitory injunction)
- Court overruled the demurrer.
- The Duke of B obtained an injunction against persons who were building near him, to prevent their
building so high as to obstruct the light of his windows, in the house now.
- waste situation
Doherty v. Allman
- Lessee intends convert the building into dwellings.
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- Lessor object to this.
- Lessor claimed that this is waste.
- Court of chancery said that this is permissive waste.
- This waste increased value of the property.
- This is ameliorating waste.
- Ct said that it is technically waste, but it improve the property.
- House of Lord affirmed the court of appeal’s decision.
- US SC is highest court.
- House of Lord is highest court in England.
- Court of Appeal decided that it dissolved the injunction.
- Why house of lord affirmed it?
- Appellant was the owner of the reversion. (combination of lessor or remainderman)
- Court has to grant equitable injunction? No.
- Where the court get power to deny injunction?
- basis of court’s discretion
- Change of the neiborhood?
- Length of the lease? 998yrs
- Ct. look at the length of the lease to justify to determine that tenant is almost absolute owner.
Travelers Insurance Co. v. 633 Third Associates
- D failed to pay property tax.
- Travelor filed for foreclosure of the property and brought an equitable action for waste to enjoin
distribution of the D’s cash assets.
- The court hold that the intentional failure to pay proerpty tax where there is an obligation to do so or
where the failure is fraudulent constitutes waste under the law of NY.
- Failure must be intentional and fraudlent, and
The failure must result in the impairment of the security of the mortgage.
The mere failure to pay principal and interest will not constitute waste.
- P was mortgagee of the loan.
- Mortgagor: who gives a mortgage (executed and deliver mortgage deed)
Mortgagee: who receive a mortgage deed
- P, field a suit because mortgagor did not pay property tax.
How it harm the mortgagee?
- if property tax is not paid, state has lien on the property and they may have the title of the property.
- Mortgagee will lose the security interest.
Dissent: Other states go to the other way.
- It thought that NY state court will deny a right of action based on failure of the mortgagor to pay
property tax.
B. Trespass
Wheelock v. Noonan
- D put rocks on P’s property.
- P asked to remove, but D did not.
- This equitable remedy is mandatory injunction.
- IS that true that P can seek common law action for money damage?
- Generally, equitable remedy will not be granted when there is adequate remedy at law.
- Then, why the court award this equitable relief?
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- They will interfere under peculiar circumstances, and have often done so where the trespass was a
continuing one, and a multiplicity of suits at laws was involved in the legal remedy.
- Hypo) Jones Johns every week bring rocks in my land.
I can ask to the court to grant equitable remedy which is mandatory injunction.
“order D to remove all rocks and prohibit D from continuing bring rocks.”
- Inadequate remedy at law!!!!!! (this is essence)
An actionable invasion of a possessor’s interest on the exclusive possession of land is a trespass; an
actionable invasion of a possessor’s interest in the use and enjoyment of his land is nuisance.
Hirschberg v. Flusser
- Bill alleges that D excavated to a depth of 24inches and he build on his land and also on the land of P
his foundation.
- P brought an action to recover possession of the land.
- This is ejectment action. Forcible entry and detainer action in IL.
- Common law action in New Jersey SC.
P was entitled to recover of possession.
There was order. (declaration) not operate in personam.
- This is a motion to strike a bill.
- New Jersey simply declared.
- Sheriff said that “oh! This is not my job.” Went back.
- P went to the chancery.
- Ct. said that it is only by the process of mandatory injunction that the obligation to remove, in the
language of the NY court, can be placed directly on the party who caused the wall to be erected.
- Neither the sheriff nor the P should be compelled to take the risk, on removal of this structure, of
injuring property of the D.
- Here, inadequate remedy at law.
- Encroachment continued as trespass, and the remedy at law was inadequate as to the aspect of
removal.
Lucy Webb Hayes National Training school v. Geoghegan
- P was hospital. D was patient.
- D did not want remove his wife to the nursing home.
- P sued for injuction to remove D.
- This is continuous trespass.
- A private hospital has a right to accept or decline any patient.
“Equity may enjoin continuing trespass, repeated or irreparable injuries to property, or a course of
illegitimate interference with business activities, if a remedy by an action for damage is not adequate.”
“It has very often been held that while, courts of equity will not wield their power merely to redress a
trespass, yet they will interfere under peculiar circumstances, and have often done so where the
trespass was a continuing one, and a multiplicity of suits at law was involved in the legal remedy.”
- What if there is no husband, she is capable to move, you are the lawyer of the hospital, what would
you do?
- the action can be brought asking appropriate guardian be appointed, and public guardian is
appointed, then you can bring an action against the public guardian.
Peter v. Archambault
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- P seek to compel the D, Archambaults, to remove a portion of the D;s house which encroaches on the
P’s land.
- P and D owned adjoining lots.
- D’s predecessor in title obtained a building permite in 1946 and built house partly on their own lot and
partly on the P’s lot (4900 square feet)
- A final decree ordered the removal of the encroachment.
Massachusetts – A landowner is entitled to mandatory equitable relief to compel removal of a structure
significantly encroaching on his land, even though the encroachment was unintentional or negligent and
the cost of removal is substantial.
In rare case, as exceptional, courts have refused to grant a mandatory injunction and have left P to his
remedy of damages.
“where the unlawful encroachment has been made innocently, and the cost of removal by the D
would be greatly disproportionate to the injury to the P from its continuation, or where the
substantial right of the owner may be protected without recourse to an injunction, or where an
injunction would be oppressive and inequitable.”
Here, encroachment covers 9% of P’s land.
The exception has been applied to much less significant invasions.
The invasion here is substantial.
P were entitled to receive whatever was shown by the land registration certificate.
Dissenting:
- During 20 yrs, P or P’s predecessor did not raise any objection.
It is reasonable to infer that prior to taking title, P viewed the property.
Thus they had actual notice of the location of the D’s dwelling.
- He believe that this record set forth unusual circumstances which would justify to deny mandatory
injunction.
Granting of injunctive relief in here would be oppressive and inequitable.,
- Removal imposes upon the D substantial cost and inconvenience which are entirely disproportionate
to the injury to the P.
- D have acted in good faith but that the initial trespass was committed many yrs before they acquired
the property.
- P want to remove encroachment.
- Trial court ordered the removal.
- Appellate affirmed.
- Only 9%? – could have been only money damage.
- What if it was only 1%? – MJ would have said that still grant injunction.
- MJ emphasized about registered land.
- Registered land – There are registered land in Cook county. Boston, and other.
- One must go to the court to present conveying document.
Then, court will allow the deed to be included in the books.
Because the transferred lien on the property, it require judicial proceeding every document which
affect to the property.
Recorder of deed = registrar of title (in Torren system)
- Here, court treated the registered land something special.
- If it was not registered land, then equitable principle could have been applied.
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C. Nuisance
State of Tennessee v. Feezell
Facts:
- State of Tennessee, on behalf of 26 citizens of Blount county, brought a suit to enjoin D, Feezell, to
enjoin the establishment of a crematory in a residential area.
- P allege that proposed establishment and operation of the crematory is a public or private nuisance.
- A demurrer was filed to state that there is no basis for injunctive relief and the chancellor sustained the
demurrer and dismissed the petition on the ground that the suit was premature.
Issue – whether there exist cause of action as nuisance to enjoin cremation establishment in a rural area
that it will cause mental anguish.
Holding – No.
For an injunction suit to be sustained prior to the alleged nuisance coming into being, it must be
sufficiently shown in the original petition that the establishment is a nuisance per se.
- Nuisance at law or nuisance per se is an act which is a nuisance at all times and under any
circumstances regardless of location or surrounding.
- Nuisance in fact or per accidens are those which become nuisance by reason of circumstances and
surrounding and an act may be found to be a nuisance as a matter of fact where the natural
tendency of the act is to create danger or inflict injury on person or property.
- Per se – injury is certain to be inflicted
Per assidens – injury is uncertain or contingent until it actually occurs
Ct held that if the injury is not real and immediate and certain to occur, but only uncertain or
contingent, the nuisance will not be enjoined anticipatory to its going into operation.
- If the injury anticipated is imminent and certain to occur, there may be proper case for immediate
abatement, the injury is recognized as otherwise actionable at law and equity.
- This court does not say that menal disturbances or psychic injury are not actionable.
- This court say that allegations in the petition must be sufficient to show that injury is imminent and
certain.
 Here, location and mode of operation and physical appearance is not sufficient.
As regard undertaking establishment, the general rule is that if an undertaking establishment in a purely
residential section causes from its normal operations, depressing feelings to families in the immediate
neighborhood, and as a constant reminder of death, appreciably impairs their happiness or weakens
their powers of resistance and depreciates the value of their property, such an establishment
constitutes a nuisance.
- This case does not coincide with general rule.
There is no allegations that any residence is in close proximity to the crematory.
- Affirmed.
- Ct. refused to grant the injunction.
- per assidens = per quod
- Quia timet relief – imminent and substantial
- This language looks same with quia timet relief
Hypo) D want to build crematory building right by my house.
P can argue that there is close proximity to the crematory with residence.
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- Depend upon the circumstances.
Campbell v. Seaman
Facts:
- since 1849, P owned 40 acres of land located on east bank of the Hudson river.
- During 1857,8,9 they built an expensive dwelling house and substantially improved their land. (planted
trees and flowers)
- D had owned adjoining land which he had used as a brick yard.
- D in burning bricks, he used coal.
- Burning the brick created some acid gas which was destructive to some kinds of trees and vines.
- Evidence show that this gas killed P’s pine foliage and killed 100 to 150 valuable pine and tree.
- This gas only came into P’s land when the wind was from the south,
General rule – every person may exercise exclusive dominion over his own property, and subject it to
such uses as will best subserve his private interests. No other person can say how he shall use or what
he shall do with his property. However, there are exceptions.
- To your property as not to injure your neighbors is old maxim.
- However, if one lives in the city he must expect to suffer the dirt, smoke, noise..
To constitute a nuisance, the use must be such as to produce a tangible and appreciable injury to
neighboring property, or such as to render its enjoyment specially uncomfortable or inconvenient.
 D’s brick burning was nuisance.
Whether the inadequate remedy at law?
- Everyone has right to surround himself with articles of luxury, and he will be no less protected than
one who provides himself only with articles of necessity. The law will protect a flower or a vine.
- These damages are irreparable too, because the trees and vines cannot be replaced, and the law will
not compel a person to take money rather than the objects of beauty and utility which he places
around his dwelling to gratify his taste or to promote his comfort and his health.
- The injunctions also prevents a multiplicity of suits. The injury is a recurring one, and every time D
burning s brick, P would have possible cause of action.
- There is no proof that When P bought the property , P knew about brick burning by D.
- Affirmed.
- Multiplicity of suit was basis of granting equitable relief.
Ct said that multiplicity would be one of basis.
- Nuisance is not continuous?
- ct did not buy.
- P came to the nuisance.
- ct. did not buy that.
- ct generally reject nuisance coming doctrine.
- but court noted that there is some situation where may be this doctrine would be applied.
- Ct. sais that there is no proof that P knew that any one intended to burn any bricks upon the land
now owned by D.
Tushbant v. Greenfield’s Inc.
- P, Tushbant, doing sporting goods company, brought an suit against D, Greenfiled Inc. restaurant
business to enjoin to cause patron to form a line up in front of P’s business.
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- From a decree for P, D appeals.
P established some extent the existence of a private nuisance.
D’s manner of conducting buinsess is harmful to P and result in their loss of business.
It is possible to minimize the damage without imposing undue hardship on D.
But, the decree should be modified.
- IT is not necessary D to require to form a line up of customer on the outside edge of the sidewalk
with not more than 2 persons standing abreast of each other.
- The obstruction of view of P’s show window for short period of time is unimportant as compared with
the inconvenience to the public use of the street .
- IF d’s employee supervise the line up, unobstructed entrance to P can be accomplished.
Dissenting:
- There are many occasions of waiting lines of patrons observed in many sities.
- Here, law afford no remedy as between the parties concerned.
- Instead remedy is in the power of the police and it is their plain duty to reasonably control street
conditions.
- The police have exclusive charge of the matter of conduct of persons on the streets.
- Public v. Private Nuisance
- Private – affect few individuals
- Public – affect many groups
- Sometimes there is combination of private and public nuisance.
- Ct. said that nuisance can be abated.
- Ct. modified the injunction.
- It modified that D’s employee could supervise the line up of customers.
- Dissent: said that this is power of the police.
Danielson v. Local 275
Issue – whether the issuance of PI under Section 10(l) depends upon the application of general equitable
principles which the court below interpreted to require a showing of irreparable harm to the employer,
or whether as the Board contends the irreparable harm concept is not pertinent in a Section 10(l) case.
- Lower court was misled by the language that “posed an imminent threat of irreparable injury, halting
the construction of the additional wing of the hospital” in Local 25 case.
- Anything less than a total work stop can be irreparable harm.
- The lower court found that construction at the job site was not substantially halted.
- But, the work was delayed and extra expense was incurred.
- This court do not agree that it is just and proper to withhold equitable relief because the pickeing has
failed to shut down the operation but only delays performance which results in the incurring of
expenses and prevention of profits.
Irreparable injury is suffered where monetary damages are difficult to ascertain or are inadequate.
Construction K is one where a breach or interference with performance result in damages which are not
readily or accurately determinable.
Basic purpose of a PI is to maintain the status quo.
The failure to issue an injunction here maintain not the status quo.
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- Reversed and remanded.
Boomer v. Atlantic Cement Co.
Facts:
- D operates a large cement plant near Albany.
- Neighboring land owner alleged that D created dirt, smoke and vibration from the plant.
- A nuisance has been found after trial, temporary damages have been allowed, but an injunction has
been denied.
Issue- whether the court should resolve the litigation between the parties now before the court or
whether, seeking promotion of the general public welfare, it should channel private litigation into broad
public objectives.
This is an area beyond the circumstance of one private lawsuit.
It is a rare exercise of judicial power to use a decision in private litigation as a purposeful mechanism to
achieve direct public objectives greatly beyond the right and interests before the party.
It is a direct responsibility for government and should not be undertaken as an incident to solving a
dispute between property owners and a single cement plant.
Special Term found that ∆ damaged the property of ∏ and it was affirmed at the Appellate Division.
However, The total damage to P’s property is relatively small in comparison with the value of D’s
operation and with the consequences of the injunction which P seeks.
The ground for the denial of injunction is the large disparity in economic consequence of the nuisance
and of the injunction.
However, this theory cannot be sustained without overruling a doctrine which has been consistently
reaffirmed in this court which that where a nuisance has been found and where there has been any
substantial damage shown by the party complaining an injunction will be granted.
The Rule in NY has been that such a nuisance will be enjoined although marked disparity be shown in
economic consequence between the effect of the injunction and the effect of the nuisance.
Whalen v. Union
- A mill entailing more than 1M polluted a stream in which ∏ who owned the farm.
Economic loss to ∏ was small.
This court reinstated the injunction against the argument of the mill owner that in view of “the slight
advantage to ∏ and the great loss that will be inflicted on ∆. Injunction should not be granted.
- The judge noted that “such a balancing of injuries cannot be justified by the circumstance of this
case.”
- Although the damage to the P may be slight as compared with the D’s expense of abating the
condition, that is not a good reason for refusing an injunction.
- Rule – whenever the damage resulting from a nuisance is found not “unsubstantial”, injunction would
follow.
There are cases where injunction has been denied.
McCann v. Chasm Power Co.
- However, there the damge was not only unsubstantial, it was nonexistence.
∏ owned a rocky bank of stream in which ∆ had raised the level of the water.
This had no economic or other adverse consequence to ∏s, and thus injunction was denied.
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 Thus, here, damage to ∏ was not “unsubstantial”, an injunction should follow.
However, close down the plant would be drastic remedy.
- One alternative is to grant the injunction but postpone its effect to a specified future date to give
opportunity for technical advances to permit ∆ to eliminate the nuisance.
- Another is to grant the injunction conditioned on the payment of permanent damages to ∏s which
would compensate them for the total economic losse to their property present and future caused by
∆’s operation.
 This court choose second method.
- because there is no assurance that any significant technical improvement would occur.
- technique to eliminate dust are unlikely developed by ∆ but will depend on whole cement industry.
- The rate of the reasrch is beyond control of ∆.
- if after short period time the new technique has not found, a court would be hard put to close down
plant because of equitable principles.
 On the other hand, if choose second alternative, it works better.
- The limitation of relief granted is a limitation only within these parties.
It does not foreclose public health or other public agencies from seeking proper reli.
- However, this judgment preclude future recovery by ∏s.
- The order should be reversed and the cases remitted to Supreme court to grant an injunction which
shall be vacated upon payment by ∆ of such amounts of permanent damage to the respective ∏s .
Dissent:
- In permitting the injunction to become inoperative upon the payment of permanent damages, MJ is
licensing continuing wrong.
“You may continue to do harm to your neighbor as long as you pay a fee.”
- It is true that in other cases, court granted such a conditioned injunction, but such cases were involved
public property which was benefit for public, but here, cement private company is creating a
continuing air pollution nuisance for its own private interest.
- This kinds of inverse condemnation may not be invoked by a private person for private gain.
- Inverse condemnation should only be permitted when the public is served in the taking or impairment
of property.
- It is unconstitutional permissible to impose servitude on land by payment of permanent damages
where the continuing impairment of the land is for a private use.
- he would enjoin the ∆ from continuing the discharge of dust unless, within 18 months, the cement
company abated this nuisance.
- This is ∆’s obligation because they were aware of the ∏’s presence in the area.
Yet, it still chose to build and operate at there.
- Here, ct did something interest.
Injunction must be granted. (substantial nuisance)
It can be stayed the effectiveness injunction on certain condition.
- permanent damages (effective in place of injunction)
Hypo) I’m one of the neighbor. I sell my property after this injunction to Jones.
Jones can sue his lawsuit? No
Permanent damage means that injunction runs with the land.
No matter whose hand the property, is bound by this judgment.
Sawyer v. Davis
Facts:
- ∆ filed a bill against ∏ to restrain from ringing a bell before 6:30am.
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- The court entered a decree to enjoin ∏ from such act.
- IT was affirmed on 1882.
- 1883 – Legislature passed the act that “Manufacturer and others employing worker are authorized to
ring bells (for the purpose of giving notice to employees) and use whistle and gongs at such hours as
the board of alderman of cities and the selectmen towns may in writing designate.
- April 1883 - ∏ obtained a license to ring the bell on their mill in such manner and at such hours
beginning at 5am.
- ∏ prayed the bill that the injunction might be dissolved or that the decree might be modified as to
enable ∏ to act under their license without violating decree.
- ∆ demurrer to the bill that argue that Act was unconstitutional.
- It is ordinarily a proper subject for legislature discretion to determine the extent to which those who
are engaged in customary and lawful and necessary occupations shall be required or allowed to give
signals or warnings by bells or whistles, or otherwise, with a view either to the public safety, as in the
case of railroad, or to the necessary or convenient operation and management of their own works; and
ordinarly such determination is binding upon the court as well as upon citizen generally.
And when legislature directs or allows that to be done which would otherwise be a nuisance, it will be
valid, upon the ground that the legislature is ordinarily the proper judgment of what the public good
requires, unless carried to such an extent that it can fairly be said to be an unwholesome and
unreasonable law.
- Slight infraction of the natural rights of the individual may be sanctioned by the legislature under the
proper exercise of the police power.
- Ct must determine the right of parties in particular cases.
Always recognizing that the ownership of property does not of itself imply the right to use or enjoy it in
every possible manner, without regard to corresponding rights of others as to the use and enjoyment of
their property;
And also that the rules of common law, which have from time ti time been established, declaraing or
limiting such rights to use and enjoyment, may themselves be changed as occasion may require.
- Nothing show unconstitutional of law.
∆ argue that there had been judicial determination that the ringing the bell in certain time was private
nuisance. It was not growing out of any public right. Thus, statute is not applicable or it is unconst.
 Legislature must be deemed to have determined that the benefit is greater than the injury and
annoyance; and to have intended to enact that the public must submit to the disturbance, for the
sake of the greater advantage that would result from this method of carrying on the business of
manufacturing.
∆ argue that legislature cannot legalize a nuisance and cannot take away the right of ∆ which declared
by the court.
 The injunction did not imply a vested right in the ∆ to have it continued permanently.
Though a final determination of the case before the court, and though binding and imperative upon
the ∏, and enforceable against them by all the powers vested in a court of equity, yet they were
at liberty at any time, under new circumstances making it inequitable for it to be longer
continued, to apply to the court for a review of the case and a dissolution of the injunction.
- Injunction can never be to be final.
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- Even without legislation’s enactment, it might be very unreasonable to continue an injunction when
business and manufacturing is increase, and character of neighborhood change.
- Injunction was dissolved.
- Demurrer was overrurled.
- - Supreme Judicial court of Mass affimed the decree of injunction.
- There was injunction against ∏.
- ∏ are asking for dissolving the injunction and modifying the injunction.
Even though, it said permanent injunction, is this procedure is proper?
- Permanent injunction is not permanent.
- It depend upon change of law or facts or …
- But the other side argue that Legislature cannot legalize nuisance.
- The injunction did not imply a vested right in the ∆ to have it continued permanently.
Though a final determination of the case before the court and though binding and imperative upon the
Spur Industries, Inc v. Del Webb
Facts:
- ∆, operated cattle feedlot business.
- It was operated by ∆’s predecessor from 1956.
- ∏, developer, Del Webb began the development plan in 1959.
- Some residential development became difficult because of odor from the feedlot.
- By 1967, Del property had extended south to Olive Avenue and ∆ was within 500 feet of Olive Avenue
to the north.
- Del field complaint alleging that 1300 lots in the southwest portion were unfit for development for sale
as residential lots because of operation of the feedlot.
- IT alleged that ∆’s operation was a public nuisance because of the flies and odor which were drifting by
the wind.
- On trial, ∆ agreed to shut down its operation without prejudice to a determination of the matter on
appeal.
May ∆ be enjoined?
- A private nuisance is one affecting a single individual or a small number of persons in the enjoyment of
private right not common to the public.
- A public nuisance is one affecting the right enjoyed by citizens as a part of the public.
To constitute a public nuisance, nuisance must affect a considerable number of people or an entire
community.
- When the injury is slight, the remedy lie in an action for damages, or some court have held balancing of
convenience case that damages may be the sole remedy.
- ∆’s operation was an enjoinable public nuisance as far as people in the southern portion of city were
concerned.
36-601 Public nuisance
- Any condition or place in populous areas which constitutes a breeding place for flies, rodents,
mosquitos and other insects which are capable of carrying and transmitting disease-causing
organism to any person.”
- There must be populous area in which people are injured.
 IT is clear that as to the citizens of Sun City, the operation of feedlot was both public and private
nuisance. Affirmed.
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Must ∏ indemnify ∆?
- Where public interest is involved
-“Court of equity may go much further both to give and withhold relief in furtherance of the public
interest than they are accustomed to go when only private interests are involved. Accordingly, the
granting or withholding of relief may properly be dependent upon consideration of public interest.”
- Coming to the nuisance case – ct have held that the residential landowner may not have relief if he
knowingly came into a neighborhood reserved for industrial or agricultural area.
- If ∏ partly injured, the court would hold doctrine of coming to the nuisance and bar to the relief
asked by him.
- If ∆ located the feedlot near the city and if the city had grown toward feedlot, ∆ would have to suffer
the cost of abating the nuisance as to those people locating within the growth pattern of the city.
- Mass court stated that
“The law of nuisance affords no rigid rule to be applied in all instances. It is elastic. It undertakes to
require only that which is fair and reasonable under all the circumstances. In a commonwealth like
this, which depends for its material prosperity so largely on the continued growth and enlargement
of manufacturing of diverse variety, extreme right cannot be enforced.”
 Here, there was no indication at the time ∆ and ∆’s predecessor located the feedlot that a new city
would be built up.
- ∆ id required to move not because of any wrongdoing but because of a proper and legitimate regard
of the court of the right and interest of public.
- ∏ is entitled to the relief prayed for PI not because ∆ is blamless, but because of the damage to the
people who have been encouraged to purchase homes.
- Then, it does not equitably that ∏ is then free of any liability to ∆ if ∏ has in fact been the cause of
the damage ∆ has sustained.
- It does not seem harsh to require a developer, who has taken advantage of the lesser land values in a
rural area as well as the availability of large tracts of land on which to build and develop a new town
or city to indemnify those who are forced to leave as a result.
- Having brought people to the nuisance to the foreseeable detriment of ∆, ∏ must indemnify ∆ for a
reasonable amount of the cost of moving or shutting down.
- ∏: developer ∆: business of cattle feedlot
- Trial court issued prohibitory injunction ∆ to not to create smell and insects.
- This was public nuisance and private nuisance.
- ∏ have to indemnify ∆ for cost of moving.
- Coming to the nuisance doctrine - have held that the residential landowner may not have relief if he
knowingly came into a neighborhood reserved for industrial or agricultural area. – relate to question of
indemnification.
Attorney fee – only provided by statute or K.
- unusual circumstance, the court grant attorney fee.
Cost is not generally not attorney fee.
Costs – cost of file the lawsuit, cost of procedure,
D. Conversion (Equitable Replevin)
Burr v. Bloomsburg
This court has jurisdiction to enforce the restitution or delivery of a specific chattel which has a peculiar
artificial value, and for which therefore adequate compensation cannot be obtained at law; and that,
too, whether possession has been got by the wrongdoer through a trust or not.
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Equity, however, will not interfere to specifically enforce a contract concerning even such a special and
unique chattel, or to compel its delivery, when its peculiar value has already been fixed by the parties or
can be readily ascertained, so that an adequate compensation in the form of debt or damages can be
recovered in a legal action.
Equitable Defenses
A. Clean Hands Doctrine
Carmen v. Fox Film Corp.
- One who comes into equity must come with clean hand.
A court of equity always refuse SP of a K which has been obtained by the P by sharp and
unscrupulous practices, by overreaching, by concealment of important facts, even though not actually
fraudulent.
- It means that equity will refuse its aid in any manner to one seeking its active interposition if he has
been guilty either of unlawful or inequitable conduct respecting the subject matter of the litigation.
- Here, ct.said that she is not entitled to equitable remedy.
- Here, there is equitable maxim.
- Maxim – One who comes into equity must come with clean hands.
- This is shorthand statement.
- Equitable maxim do not apply common law right and remedy.
- So far as equitable remedy is concerned, clean hands doctrine apply.
- IF D’s counsel does not raise unclean hand defense, it deemed to be waived.
Generally, ct do not raise equitable issue which is not raised by parties by sua sponte.
Claire v. Rue de Paris, Inc.
- Where stockholders in a corporation participate in the performance of an act, or acquiesce in and
ratify the same, they are stopped to complain thereof in equity. This applies to derivative shareholder
claims as well as direct actions against corporations.
- whenever a party, who, as actor, seeks to set the judicial machinery on motion and obtain some
remedy, has violated conscience, or good faith, or other equitable principle, in his prior conduct, then
the doors of the court will be shut against him in limine; the court will refuse to interfere on his behalf,
to acknowledge his right, or to award him any remedy.
Seagirt Realty Corp. v. Chazanof
- Unclean hands doctrine bars only cause of action founded in illegality or immorality.
Voluntary reconveyance to the fraudulent grantor, even from the immediate fraudulent grantee, is
effective as between the parties and is entitled to the protection of the courts in its enjoyment.
- The maxim must be applied only where the P has dealt unjustly in the very transaction of which he
complains.
B. Laches and the Statute of Limitations
Environmental Defense Fund, Inc. v. Alexander
- Equitable remedies are not available if granting the remedy would be inequitable to the defendant
because of the plaintiff’s long delay.
- Three independent criteria must be met before laches can be invoked to bar litigation.
The defendant must show that (1) a delay in asserting a right or claim (2) that the delay was not
excusable; and (3) that there was undue prejudice to the party against whom the claim is asserted.
- Whether laches bars an action in a given case depends upon the circumstance of that case and is a
question primarily addressed to the discretion of the trial court.
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- Mere neglect to challenge action is not sufficient to establish laches in any case.
- Hypo) Laches – IL – written K – 10 yrs SOL
- Seller refused to confirm his K.
K was made 9yrs old.
What you gonna say to your client?
- If he want money damage, then it is ok.
But if he want SP, then laches may apply here.
If the other side raise laches as defense, your case is likely lose.
The essence of laches is unreasonable delay by the P causing material prejudice to the D.
(1) P delayed bringing the action
(2) that P’s delay was unreasonable and inexcusable.
(3) that D was materially prejudiced by the delay.
Addison v. State
Court have adhered to a general policy which favors relieving P from the bar of a limitations statute
when, possessing several legal remedies he, reasonable and in good faith, pursues one designed to
lessen the extent of his injuries or damage.
Ex) statute of limitations on a personal injury action is tolled while P asserts a workers’ compensation.
Rule of law - Whenever exhaustion of administrative remedies is a prerequisite to a civil action the
running of the limitations period is suspended during the administrative proceedings and we stated that
“regardless of whether the exhaustion of one remedy is a prerequisite to the pursuit of another, if the D
is not prejudiced thereby, the running of the limitations period is tolled “when an injured person has
several legal remedies and, reasonably and in good faith, pursues one.”
Application of the doctrine of equitable tolling requires timely notice, and lack of prejudice, to the
defendant, and reasonable and good faith conduct on the part of the P.
C. Estoppel
Barry v. Donnelly
One may be estopped to plead the bar of statute of limitations by conduct of short of fraud, under the
general doctrine of equitable estoppels.
Under that doctrine, estoppels occurs where “the aggrieved party reasonably relied on the words and
conduct of the person to be estopped in allowing the limitations period expire.”
“to establish equitable estoppels, it is not necessary to show actual fraud, but only that the person to be
estopped has misled another to his prejudice.”
Equitable estoppels
(1) misleading conduct in the form of words or actions by the party to be estopped.
(2) the misleading conduct must induce the other party to act or refrain from acting in a way that is
prejudicial to his legal interests.
Office of Personal Management v. Richmond
General rule is that the defense of equitable estoppels cannot be asserted against the government.
The court has expressly held that the estoppels defense cannot be used to extract an appropriation of
public money.
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When equitable estoppels against the government is recognized, it is subject to heavy proof obligations.
The requirement most commonly imposed in that of “affirmative misconduct,” which is intentional,
wrongful behavior by the government through its employees.
It is clear that positive governmental action is required; the estoppels cannot be based on “mere
inaction, delay or sloth on the part of the government.”
The Constructive Trust and Related Remedies
A. The Constructive Trust
A constructive trust is an equitable remedy that provides for specific restitution, return or restoration of
property that has been wrongfully acquired by the D. The D is said to hold the property involuntarily “as
a trustee” for the person with a superior equitable claim to the property.
A constructive trust is imposed by law to prevent the possessor’s unjust enrichment that would result
were the possessor allowed to retain title and possession.
Snepp v. US
The court upheld the constructive trust remedy.
Snepp’s status with the CIA made him a trusted employee and created a confidential relationship.
Constructive trusts are often invoked when a fiduciary breaches a duty owed to the beneficiary.
Sharp v. Kosmalski
Rule:
- “A constructive trust may be imposed when property has been acquired in such circumstances that the
holder of the legal title may not in good conscience retain the beneficial interest.”
- Four element to impose constructive trust
(1) confidential or fiduciary relationship
(2) promise
(3) a transfer in reliance thereon; and
(4) unjust enrichment
Analysis:
- Although there was no marital or family relationship, the record indicate that a relationship of trust
and confidence did exist and defendant must be charged with an obligation not to abuse the trust and
confidence placed in her by plaintiff.
- The disparity in education between the plaintiff and defendant highlights the degree of dependence
of the plaintiff upon the trust of the defendant.
- There was a transfer of property. Trial court found that the transfer was made without promise.
However, the promise may be implied or inferred from the transaction itself.
Judge Cardozo observed that “though a promise in words was lacking, the whole transaction was
instinct with an obligation imperfectly expressed.
- Here, it is unreasonable that plaintiff would convey all his property to defendant without at least
tactic (implied) consent upon defendant that she would permit him to continue to live on the farm.
- Trial court found that the transfer did not constitute unjust enrichment.
- However, having determined that the relationship is of such a nature as to invoke consideration of
the equitable remedy of constructive trust, it remains to be determined whether defendant’s
conduct following the transfer of farm was in violation of that relationship and resulted in the
unjust enrichment.
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- This must be determined from the circumstances of the transfer since there is no express promise
concerning plaintiff’s continued use of the land.
- Therefore, the case should be remitted to the appellate division for a review.
Simonds v. Simonds
Facts:
- There was separation agreement required husband to maintain in effect, with the wife as beneficiary
to the extent of $7000, existing life insurance policies.
- The proceed had been paid to the named beneficiaries, husband’s second wife, who is defendant in
this case and her daughter.
- The first wife who now seeks to impress a constructive trust on insurance proceed.
- The special term granted partial summary judgment to plaintiff and impressed a constructive trust to
the extent of $7000 plus interest.
- Appellate division affirmed.
Issue:
- whether the separation agreement entitles the plaintiff to impress a constructive trust on insurance
proceed, despite the husband’s failure to name her as the beneficiary on substitute policy once the
original insurance policy had lapsed.
Holding: There should be an affirmance.
Analysis:
- An agreement for sufficient consideration like separation agreement to maintain a claimant as a
beneficiary of a life insurance policy vests in the claimant an equitable interest in the policies
designated.
- This interest is superior to that of a named beneficiary who has given no consideration.
- Mere substitution of policies does not defeat the equitable interest of one who has given sufficient
consideration for a promise to be maintained as beneficiary under an insurance policy.
- If an insured, upon lapse or cancellation of insurance, followed by replacement with new insurance,
has a contractual obligation to designate a particular person as beneficiary, equity will consider the
oblige as a beneficiary.
- Due to the husband’s failure to do what he should have done, the plantiff acquired not only a right to
sue his estate for breach of contract, but also an equitable right in the policies.
- Here, her remedy is imposition of a constructive trust.
- Even though 4 element were set up by Sharp case.
“Constructive trust will be erected whenever necessary to satisfy the demands of justice.
- here, there was confidential relationship.
- Unjust enrichment does not require any wrongful act.
Innocent party may be unjust enriched.
What is required is that a party hold property under such circumstances that in equity and good
conscience he ought not to retain it.
- Here, unjust enrichment was established.
Second wife collected more than $55,000. While first collected nothing.
If the husband had kept his promise, second wife would have collected $7000 less.
Second wife have been unjustly enriched.
- Affirmed.
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“Unjust enrichment, however, does not require the performance of any wrongful act by the one
enriched. Innocent parties may frequently be unjustly enriched. What is required generally is that the
party hold property under such circumstances that in equity and good conscience he ought not to retain
it.”
B. Other forms of Restitution from Property
Equitable Lien differs from a constructive trust in that it provides security for the equitable debt
whereas a constructive trust provides specific restitution of the property or the property’s cash
equivalent. Constructive trust is a specific restitutionary remedy. P claim the property, but not damages
resulting from the wrongdoing. However, since an equitable lien merely secures a debt, it can be used in
conjunction with a damages award.
Equitable Assignment:
- When there is no legally enforceable assignment and an assignment is deemed necessary to prevent
unjust enrichment, equity recognizes a duty to assign, which it can specifically enforce when justice
requires.
Perry v. Perry
- Trial chancellor entered a decree in favor of the children for the sum of 2 group policies.
But he impressed no trust on any balance standing to Mary’s credit in the commingled account.
As to the GI policy, the chancellor found in Mary’s favor on the ground that Merry has a superior right.
- This court do not agree with the reasoning that led to the award GI to Mary.
- Only difference between 2 and GI was that Mary paid premium.
There was no proving that she did so as the result of any K between her and Perry.
Absent such a K, the payment of premium by one who is merely hopeful of receiving the proceeds
vests no right in him, and the insured may change the beneficiary without the latter’s consent.
- But it does not follow that Mary should lose the money she has paid to keep the policy live.
- one who pays the premium in the reasonable expectation of being the beneficiary will be entitled to
reimbursement for his effort from the one who profits from it by receiving proceeds when that
expectation was not achieved.
- This right does not exist with respect to premium paid after the payor’s interest has been terminated
by a change of beneficiary.
- However, here, Perry failed to change the beneficiary. Wife indifferent to that neglect was hardly
calculated to dispel Mary’s hope.
She did not pay the premium with intention for children’s benefit.
- The decree is reversed and remanded with directions
1. To enter a general judgment against Mary for the proceeds of all three policies minus the sum of the
premiums she has paid for GI and to impress a constructive trust for the net debt on the balance,
if any, standing to her credit in the commingled account.
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