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SHEETS V. SELDEN, 74 U. S. 416 (1868)

U.S. Supreme Court

Sheets v. Selden, 74 U.S. 7 Wall. 416 416 (1868)

Sheets v. Selden

74 U.S. (7 Wall.) 416


1. The action of an inferior court as to the terms on which it will allow a complainant to amend a bill in equity to which it has sustained a demurrer is a matter within the discretion of such court, and not open to examination here on appeal.

2. Where, under a clause of reentry for nonpayment of rent reserved, a landlord sues in ejectment in Indiana (in which state a judgment in ejectment has the same conclusiveness as common law judgments in other cases) for recovery of his estate as forfeited, and a verdict is found for him, and judgment given accordingly, the tenant cannot, in another proceeding, deny the validity of the lease, nor his possession, nor his obligation to pay the rents reserved, nor that the installment of rent demanded was due and unpaid.

3. Where, in a lease of a water power, the lease provides in a plain way and with a specification of the rates for an abatement of rent for every failure of water, the tenant cannot, on a bill by him to enjoin a writ of possession by the landlord, after a recovery by him at law for forfeiture of the estate for nonpayment of rent reserved, set up a counterclaim for repairs to the water channel made necessary by the landlord's gross negligence. He is confined to the remedy specified in the lease, a covenant that a lessor will make repairs not being to be implied.

4. In such a case, before he can ask relief from a forfeiture, he should at least tender the difference between the amount of rents due and the amount which he could rightly claim by way of reduction for failure of water.

The State of Indiana, owning a certain canal and its adjacent lands, made two leases of its surplus water, the first being made February, 1839, to one Yandes and a certain Sheets (this Sheets being the appellant in this case), and the other made January, 1840, to Sheets alone. Each lease was for the term of thirty years. Certain rents, payable semiannually on the first of May and November, were

Page 74 U. S. 417

reserved, it being provided that if any rent "should remain unpaid for one month from the time it shall become due," "all the rights and privileges" of the lessees "shall cease and determine, and any authorized agent of the state, or lessee under the state, shall have power to enter upon and take possession of the premises" &c. The leases contained a further provision that the lessees should not be deprived of the use of the water by any act of the state or its agents or by the inadequacy of the supply of water for more than one month in the aggregate in one year, and that if, for the purposes of repairing the canal, preventing breaches, or making improvements to the canal or the works connected with it or the inadequacy of the supply of water, the lessees should be deprived of the use of any portion of the water power leased, such deduction should be made from the rent accruing on such portions of the power as the lessees should be prevented from using as would bear the same proportion to the yearly rent thereof as the time during which the lessees might have been deprived of its use bears to eleven months. In October, 1840, Sheets became owner of Yandes' interest in the lease of 1839.

The state subsequently sold so much of the canal, land, and water power as was embraced by the two leases, and one Selden and others, on the 2d of October, 1857, became owners under this sale.

Afterwards (Sheets being in possession under the leases and having refused for several years to pay rent), the purchasers formally demanded on the premises rents falling due on the first day of May, 1860. The lessee failing to pay them, the purchasers brought, in June, 1860, an ejectment in the Circuit Court for Indiana (in which state the action of ejectment is regulated by statute, and has the same conclusiveness as common law judgments in other cases) to recover the possession of the property, as for forfeiture from nonpayment of the rents reserved in the two leases. Verdict and judgment were given in their favor. [Footnote 1]

Page 74 U. S. 418

After five years had elapsed since the commencement of the ejectment, the lessee now filed a bill in equity (the suit below) to enjoin the issuing of a habere facias on the judgment in ejectment and for a redemption of the lands from the forfeiture incurred for nonpayment of rent.

The bill alleged that while the ejectment was pending, the lessees tendered to the purchasers $400 as in full for the particular rents for the nonpayment of which the forfeitures were declared and as in full for interest thereon and the costs of suit up to that time, and that the same was now brought into court for the purchasers if they would accept it and waive the forfeiture, but it tendered nothing for rents subsequently or previously accrued. It sought to avoid such a tender by asserting an equity to set off against all rents a demand for damages on account of alleged breaches of covenants contained in the leases. As for:

1. Inadequacy in the supply of water, when by the use of proper efforts, an adequate supply might have been furnished.

2. Inadequacy of supply, owing to the culpable negligence and gross carelessness of the purchasers in failing to repair breaches in the canal banks and to remove obstructions created by the growth of grass in the bottom and sides of the canal &c., setting up the expense of repairs alleged to have been made by the lessee to render the supply adequate.

3. Not prohibiting lessees under subsequent leases from drawing off needed water from the mill of the original lessee to supply their own.

The claim of reductions of the rents owing to failure of water were from the 2d October, 1852, when the title of the purchasers accrued, to the 1st May, 1865, when the last installment of rents before the filing of the bill came due, and amounted to $2,649. The rents during the same term amounted to $4,500.

The lessee alleged as an excuse for not paying the rents on one of the leases that he had abandoned that lease and that the purchaser under the state acquiesced, and that the title so became vested in them by reverter, and declined to

Page 74 U. S. 419

redeem that lease from forfeiture. While thus declining to redeem that lease, his bill sought to enjoin the whole judgment.

The defendants demurred, and the court sustained the demurrer, giving leave to the complainant to amend his bill on tender of all the rent, with interest on it that had accrued on both leases since the bringing of the ejectment, which sums the court found to be, on one lease $4,494.50, and on the other $2,247.25. The complainant refusing to amend on such terms, judgment was given on the demurrer against him, and he brought the case here.

Page 74 U. S. 420

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