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should be placed less than 35 feet from front, dential Improvement Company conveyed lot line; and that no fence should be erected in 2, one of the five lots fronting on West Adams front of the front line of any building "within five years from the date” of the deed-is, al- street, to one Kennedy, and it is alleged in though the two parts of the sentence are sepa- the complaint that: rated by a semicolon, to apply the time limit to The deed "for the benefit of the purchaser both, the authorities indicating a tendency on of said lot and for the benefit of the purchasers the part of the courts to read a restriction ex- of the remaining lots of said tract, and the pressed in a deed as a whole, disregarding at administrators, executors, heirs and assigns of times even the strict rules of punctuation. each of them, and particularly of those lots 6. COVENANTS 69(2) CONSTRUCTION fronting on West Adams street, contained the BUILDING RESTRICTIONS.

following covenants and restrictions: “That no Conveyance to plaintiff's predecessor con building or buildings shall be erected, construct. tained covenant that no buildings should be ed or placed upon the premises hereby conveyed, placed upon the premises less than 35 feet the front line of which shall be less than thirtyfrom the front line, that no building to be used five (35) feet from the front line of said premas a dwelling should be erected upon said prem- ises, and that no building to be used as a dwell. ises within five years from the date of deed ing house shall be erected, constructed or placed which cost less than $2,500, and that no fence upon said premises within five years from the should be erected in front of the front line of date of this deed which shall cost less than any building erected upon the premises. Con- twenty-five hundred dollars ($2,500.00) and that veyance of other lots fronting on the same no fence shall be erected, placed or constructstreet omitted covenant as to cost, and the in- ed in front of the front line of any building hibition regarding fences was followed by the erected, constructed or placed upon the said words "within five years from the date of this premises.' deed." Held, that the variation in the deeds

In April, 1909, plaintiff by mesne conveyindicated that the grantor was merely seeking to put a personal covenant in each deed termi- ances became the owner in fee of lot 2, has pable as to all its parts after five years.

ever since been the owner, and has his resi

dence thereon. Department 2. Appeal from Superior

In January, 1907, the Prudential ImproveCourt, Los Angeles County; Lewis R. Works, ment Company (under a changed name) conJudge.

veyed lots 3, 4, and 5 (also fronting on West Action by P. W. Bresee against R. J. Dunn Adams street) to one Hundley. The deed conand others. From judgment following an or: tained the following conditions, also alleged der sustaining general demurrer to amended in the complaint to have been for the benefit complaint, plaintiff appeals. Affirmed.

of the purchasers of all of the lots: Williams, Goudge & Chandler, of Los Ange "This deed is made subject_to the following les, for appellant. James, Smith & McCarthy express conditions, to wit: That no building and Hammack & Hammack, all of Los Ange-placed upon the premises hereby conveyed, the

or buildings shall be erected, constructed or les, for respondents.

front line of which shall be less than thirty

five (35) feet from the front line of said premMELVIN, J. Judgment followed an order ises on West Adams street; and that no fence

sball be erected, placed or constructed in front sustaining a general demurrer to the amend of the front line of any building erected, coned complaint. From said judgment plaintiff structed or placed upon the said premises withappeals.

in five years from the date of this deed." The action one whereby plaintiff Thereafter by mesne conveyances the de sought to enjoin defendants from construct- fendants, in February, 1914, because the owning a house on their property in alleged viola-ers in fee of lot 3 which adjoins plaintiff's tion of a certain building restriction. The property, lot 2. complaint avers substantially the following It is further alleged (but without the date facts:

being given) that lot i fronting on West In October, 1901, Prudential Improvement Adams street was sold by the Prudential ImCompany, owner of a block of land in the city provement Company and conveyed by deed, of Los Angeles, bounded by West Adams, which was duly recorded; said deed conto inAnita, Normandie, and Twenty-Seventh ing restrictions similar to those in the deed to streets, caused said land to be resubdivided lot 2 which we have quoted above. and filed for record a plat showing the divi. When defendants became the owners of the sion thereof into lots, of which there were property here involved, they had knowledge 21 of substantially uniform size. It was and and notice of the restrictions upon all the ever since has been (according to the com- lots fronting on West Adams street. plaint) the intention and plan of the owners [1] It is further averred that, at all times that the tract should be occupied only by resi- prior to the date of the acquisition of title by dences so erected that those fronting on West defendants in 1914, "the said building restricAdams street should be not less than 35 feet tions upon said lots have been faithfully obfrom the front line of the property and those served" (an allegation which respondents fronting on Normandie and Anita streets not very justly term a mere conclusion). Defendless than 25 feet. It is further alleged that ants were about to construct a building withthe owner of the property “in conveying the in 35 feet of the front line of their property, same did so restrict said property by express and plaintiff by this action sought to enjoin provisions contained in the respective convey- them from so doing. Appellant belieres that ances of said lots.” In November, 1901, Pru- he has sufficiently pleaded the existence of

was

enforceable covenants entered into with the , and it is a reasonable construction to apply design of carrying out a general plan for the the time limit as expressed by the words development of real property subdivided into "within five years," etc., to both building reparcels, and he cites in this behalf many au- strictions, the one referring to houses as well thorities, such, for example, as De Gray v. as that applying to fences. The authorities Monmouth Beach Club House Co., 50 N. J. indicate a tendency on the part of courts to Eq. 329, 24 Atl. 388; Brouwer v. Jones, 23 read a restriction expressed in a deed as a Barb. (N. Y.) 153; Korn v. Campbell, 192 N. whole, disregarding at times even the strict Y. 490, 85 N. E. 687, 37 L. R. A. (N. S.) 1, 127 rules of punctuation. For example, the limiAm. St. Rep. 925; Allen v. City of Detroit, tation for ten years was held to apply to all 167 Mich. 464, 133 N. W. 317, 36 L R. A. (N. restrictions, including that with reference to S.) 890.

the building line in the following covenant in (2-4) Undoubtedly, covenants imposing a deed: building restrictions have been frequently "That the said grantee or his heirs or asupheld, but the courts are slow to declare signs shall not for a period of ten years erect such burdens upon real property to exist un- thereof which shall

be used or occupied for any

on the granted premises any buildings or parts less it clearly appears from the deeds of con- other purposes than dwelling-houses, and priveyance, not only that a general scheme of vate stables, and buildings usually appurtenant improvement is contemplated, but also, if a which may be used for store purposes, and said

to dwelling houses, except the corner lots, grantee of the original covenantee seeks to dwellings to be occupied by none but respectable enforce the restriction, that it is not a mere families, and that no building, or part of any personal covenant but passes with the land. shall be erected within fifteen feet of the front In the pleading now under consideration it 55 N. E. 1043.

line of each lot.” In re Welsh, 175 Mass. 68, does not appear that there was any reversion left in the original covenantee. The com

In Best v. Nagle, 182 Mass. 495, 65 N. E.

842, a similar ruling was made with referplaint shows neither by direct averment nor

ence to the following provisions in a conveyby quotation from the original conveyances

ance: that any penalty attached to disobedience of the building restrictions. It does contain al- houses shall be placed upon said lots, or either

“That no building except the ordinary outlegations to the effect that the fee passed of them, of less value than four thousand dolfrom the Prudential Improvement Company lars, and all buildings erected thereon, shall to the predecessors of plaintiff and defend set back from the line of the several 'streets

shown on said plan, at least twenty feet, nor ants in the ownership of lots 2 and 3 and shall any building erected on said land be used from them by mesne conveyances to these liti- for a livery stable or tenement house, or for gants respectively. The rule is that where any manufacturing purposes, for the period of

ten years." the fee is passed to the covenantor and no reversion is left in the covenantee, there is

Another instructive case upon this subject no privity of estate or tenure between the is Armstrong v. Griffin, 83 N. J. Eq. 599, 91 parties, and the burden of the covenant, Atl. 1016; Id., 84 N. J. Eq. 196, 93 Atl. 1084. though imposed upon the land conveyed, is [6] The quotations from deeds appearing solely for the personal benefit of the covenan- in the complaint do not justify the pleading tee, not passing with the realty to his gran- that there was a uniform plan for the benefit tee. Los Angeles Terminal Land Co. v. Muir, of all lots fronting on West Adams street. In 136 Cal. 36-42, 68 Pac. 308; Berryman v. Ho the conveyance to appellant's predecessor, tel Savoy Co., 160 Cal. 559-565, 117 Pac. 677, made in 1901, three prohibitions are express37 L. R. A. (N. S.) 5.

ed, one against erecting a building within 35 There is nothing in either of the quotations feet of the front line of the premises, a secfrom conveyances set forth in plaintiff's ond forbidding the construction of a house pleading and nothing in the averments of the costing less than $2,500, and a third for the complaint to take the pleaded restrictions out prevention of the placing of a fence in front of the category of purely personal covenants of any building on the property. The phrase made for the original grantor's benefit. For "within five years from the date of this this reason the demurrer was properly sus- deed,” upon the strict grammatical constructained.

tion for which appellant contends, might be (5) Respondents also insist, and we think held by reason of its place in the sentence correctly, that the covenants were intended to apply only to the limitation regarding minto and did expire by limitation of time. In- imum cost of any house, leaving the other spection of the quoted portion of the deed to two provisions enforceable for all time. Idenrespondents' predecessor reveals the fact that tical provisions were in the deed disposing of it contains the negative covenant that no the Prudential Company's interest in lot 1. building shall be placed less than 35 feet from | Yet in the deed to lots 3, 4, and 5, made in the front line of the property, and that no 1907, while the restriction upon lowest cost fence shall be erected in front of the front of any building is omitted as it would be line of any building “within five years from very properly if a general and uniform plan the date” of the deed. It is true that the two of improvement were being carried out the parts of the sentence are separated by a semi. inhibition regarding the erection of a fence colon, but they are conjunctively attached, in front of any building is followed by the

ex

words "within five years from the date of this association of persons in trust for or to be dedeed.” This absolutely contradicts appel-voted to any charitable, benevolent, educational, lant's pleaded conclusion that the covenantee person or corporation shall become beneficially

or public purpose, by reason whereof any such was pursuing a general and uniform plan of entitled, in possession or expectancy, to any establishing a residence district with similar such property or to the income thereof, shall be spaces in front of each dwelling. And it does

exempt.” more than that. It indicates that the gran

It is difficult to conceive of any language tor was merely seeking to put à personal by which a more direct exemption could be covenant in each deed terminable as to all its made. Authorities are cited from other parts after the lapse of five years.

states wherein exemptions of charitable corThe judgment is affirmed.

porations have been held, under the language

of the particular statute construed, to apply We concur: WILBUR, J.; VICTOR E. only to domestic charitable corporations. SHAW, Judge pro tem.

Our attention is not called to any law which is as broad and comprehensive in its scheme

of exemption as our statute. If this stat. (178 Cal. 116)

ute simply read, “All property transferred to In re FISKE'S ESTATE.

corporations and institutions now or hereCHAMBERS, Controller, v. PRINCETON after exempted by law from taxation," it UNIVERSITY et al.

might very well be argued, as it was in the

cases in question, that the exemption "law" (L. A. 5433.)

referred to was the law of this state, and (Supreme Court of California. April 12, 1918.) | that therefore we should look to its law to TAXATION Cm876(6)-INHERITANCE TAX-Ex

determine what societies, corporations, and EMPTION-FOREIGN CHARITABLE OR BENEVO. institutions are exempt from taxation. As LENT CORPORATIONS-STATUTE.

there are additional provisions in the stat. Foreign charitable corporations were

ute concerning exemptions, we are not jusempt from inheritance tax on property left them by will under Inheritance Tax Law 1915 (St. tified in any construction of the statute 1915, p. 421) art. 1, § 7, exempting charitable which depends upon such consideration corporations.

alone. Some of the cases cited are based Department 2. Appeal from Superior upon the general consideration that, where Court, Los Angeles County; Fred H. Taft, corporations” are referred to in such legis

lation, it must be inferred that the LegislaJudge.

In the matter of the estate of Marie An- ture was exempting such corporations only toinette Fiske, deceased. From a judgment tic corporations. Under the statute of this

as it has jurisdiction over, namely, domesexempting Princeton University and other corporations from paying an inheritance tax, state there is no room for such construcJohn S. Chambers, Controller, etc., appeals. ciety," an “institution,” an “association of

tion, for the exemption is extended to a "soAffirmed.

persons,” and to “any person" as well, if enJohn W. Carrigan and Edwin H. Pennock, gaged in the work described. It must be both of Los Angeles (Robert A. Waring, In- apparent that the Legislature intended to heritance Tax Atty., of Sacramento, of coun- exempt from taxation all property devoted sel), for appellant. C. J. Willett and A. G. to certain purposes, namely, property "de Allen, both of Pasadena, for respondents.

voted to any charitable, benevolent, educa

tional, or public purpose," "or any other WILBUR, J. This is an appeal from a like work." The fact that the devisee or judgment declaring that certain foreign cor- legatee might be a corporation, foreign or porations, to wit, Princeton University, Che domestic, was an entirely indifferent matter, shire Public Library, and Cheshire Ceme for the exemption was made to apply to tery, all existing for nonprofit purposes, are societies,” “corporations," "institutions," exempt from paying an inheritance tax upon “association of persons,” and to all “perthe property left to them by the will of the sons.” It would seem to verge upon an abdecedent. The facts are stipulated, and the surdity to say that when the Legislature only question is whether, under the inherit- used the word “person” it meant any person, ance tax law of 1915 (St. 1915, p. 421), such resident or nonresident of the state; but, foreign corporations are exempt from the when it used the word "corporation" in expayment of the tax. That statute (article I, actly the same connection and in the same $ 7) reads as follows:

sentence, it meant only domestic corpora"All property transferred to societies, corpo- tions. We are in entire accord with what rations, and institutions now or hereafter ex

was said in Re Frain, 141 La. 932, 75 South. empted by law from taxation, or to any public corporation, or to any society, corporation, in-847, where the numerous decisions relied upstitution, or association of persons engaged in on by the appellant were reviewed. The or devoted to any charitable, benevolent, educa- court there pointed out that the decisions tional, public, or other like work (pecuniary profit not being its object or purpose), or to holding that foreign charitable corporations any person, society, corporation, institution, or were not exempt were based upon the lan

guage of the particular statute under con Hollzer & Morton, Harry A. Hollzer, and C. B. sideration, and added:

Morton, all of Los Angeles (Jerome H. Kahn, "Very true, these decisions are reinforced by of Los Angeles, of counsel), for respondents. considerations based on the policy of the law in granting exemptions; but their main and WILBUR, J. This is an action brought real basis is the text itself of the statute. And by the plaintiffs to recover damages for the text of the statute emption to religious institutions in general,

with breach of contract to convey real estate, out qualification.”

executed March 14, 1911. The Code preWe find it unnecessary to discuss the nu- scribes the ordinary measure of damages in merous decisions of other states, in which such cases, and then makes this special pro laws more or less similar to ours are con- vision, "but adding thereto, in case of bad strued to mean that domestic corporations faith, the difference between the price agreed are exempt and foreign corporations taxed. to be paid and the value of the estate to be Nor is it at all necessary to discuss the con conveyed,” etc. The price agreed to be paid ceded right of a state to discriminate be in the instant case was $33,500, of which tween foreign and domestic corporations in $250 was paid and $4,750 agreed to be paid in the imposition of the inheritance tax.

Es

cash, the balance by mortgage and trust deed tate of Speed, 203 U. S. 553, 27 Sup. Ct. 171, on the property. The verdict was for $5,250. 51 L. Ed. 314.

The principal question involved was whelaer The judgment is affirmed.

or not there was bad faith in the refusal, if

any, to convey. On this subject, the court inWe concur:

structed the jury as follows: MELVIN, J.; VICTOR E.

"In order to charge the defendants with bad SHAW, Judge pro tem.

faith, it is not necessary that their conduct be shown to be fraudulent. It is sufficient to

show that their conduct in failing to convey (178 Cal. 128)

this property to the plaintiffs was by reason of HAMAKER et al. v. BRYAN et al. any frivolous or unfounded refusal in law or in (L. A. 4164.)

fact to comply with the terms of their agree

pient. Any unlawful or unjustifiable refusal on (Supreme Court of California. April 13, 1918. their part to comply with their agreement would Rehearing Denied May 9, 1918.)

be sufficient to constitute bad faith; and in de1. TRIAL 194(11) INSTRUCTIONS BAD

termining whether or not the conduct of the deFAITH-PROVINCE OF JURY.

fendants in this case was such as to show bad In an action for damages for breach of con- the facts and circumstances surrounding their

faith, you should take into consideration all of tract to convey real estate in which damages failure to convey the property as disclosed by for bad faith were claimed under Civ. Code, 8

the evidence." 3306, an instruction defining bad faith as any unlawful or unjustifiable refusal on the vendors' [1-3] The jury were thus instructed that: part to comply with the agreement would be "Any unlawful or unjustifiable refusal on sufficient to constitute bad faith, taking into their (the vendors') part to comply with their consideration all the facts and circumstances agreement would be sufficient to constitute bad surrounding the failure to convey, was errone- faith.” ous; the bad faith of the vendors being a jury

Every breach of a valid and subsisting question.

contract for which damages may be recov2. VENDOR AND PURCHASER 351(1) BREACH OF CONTRACT—"Bad FAITH."

ered under section 3306, Civil Code, is "unIn an action for breach of contract to con- justifiable," and in a sense "unlawful,” for vey real estate, it was not bad faith, under Civ. the law requires that a person fulfill his leCode, $ 3306. providing measure of damages in gal obligations. The instruction was therecase of "bad faith" of vendor, for the vendors to enter into the contract after having made ar- fore clearly erroneous and prejudicial. The rangements to secure title to the land they bad faith of the vendors was a question of agreed to convey.

fact to be determined by the jury. Appellate (Ed. Note.-For other definitions, see Words courts have been called upon to determine and Phrases, First and Second Series, Bad whether or not the evidence before the trial Faith.) 3. VENDOR

court was sufficient to justify a decision as to PURCHASER 351(1) BREACH OF CONTRACT—“BAD FAITH."

the fact of good faith or bad faith, but our In an action for breach of contract to con- attention has not been called to any case vey real estate, a few days' delay by the vendors where a trial court, as a matter of law, has in securing title to the land does not constitute attempted to define “bad faith.” In Morgan bad faith, within Civ. Code, $ 3306, relating to measure of damages in case of "bad faith" of v. Stearns, 40 Cal. 434, 439, before the enactvendor.

ment of section 3306, Civil Code, the Supreme Department 2. Appeal from Superior Court declined to disturb a judgment for Court, Los Angeles County; Frank G. Fin- damages based upon a difference between the layson, .Judge.

market value and the contract price of land Action by W. M. Hamaker and others where the vendor “willfully refused to comagainst E. P. Bryan and others. Judgment ply with the terms of the agreement to confor plaintiffs, and defendants appeal. Re- vey merely because the land has in the meanversed.

time considerably appreciated in value," but

said: W. W. Butler and Anderson & Anderson,

"It is unnecessary to examine to what, if any, all of Los Angeles, for appellants. Morton, Jextent the rule of damages for failure to convey

For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes

AND

land is affected by the good faith of the defend-, with its further assertion of ownership of the ant appearing."

sum deposited. In Yates v. James, 89 Cal. 474, 26 Pac. 1073,

Appeal from Superior Court, Los Angeles the failure of the vendor to convey was due

County; Charles Wellborn, Judge. to the refusal of the vendor's wife to join

Action by E. K. Foster against the Los in a deed, the property being covered by a homestead declaration filed by the vendor Angeles Trust & Savings Bank, a corpora

tion. Judgment for defendant, and plaintifr before the contract of sale, and yet it was held that "bad faith” was not "proved," and appeals. Affirmed. the judgment was reversed for that reason,

Isidore B. Dockweiler, of Los Angeles (W. although the inability of the defendant to D. Finch and Thomas A. J. Dockweiler, both convey was due to a defect in his title (if a of Los Angeles, of counsel), for appellant. homestead may be classed as such) existing Jones & Weller, of Los Angeles, for respond. at the time he made the contract of sale. ent. In Clark v. Yocum, 116 Cal. 515, 48 Pac. 498, the vendee paid the full purchase price ($4,- JAMES, J. This action was brought to re400) of certain land and appurtenant water cover the sum of $840 and interest. The right. The price of the water right was not gist of the claim of the plaintiff was that this segregated, but it was alleged to be of the money had been deposited with the defende value of $2,000. A judgment for that amount ant by a third party for his benefit, and that, was secured and affirmed. The vendors were conditions precedent having been satisfied the owners of said water right, and accepted and demand made, plaintiff was entitled to the full purchase price therefor, and then, collect from the defendant the sum mention"without any just reason or excuse," refused ed. Answer was filed to the complaint, and to perform their contract. It was held that among the defenses alleged was that of the they were guilty of bad faith as a matter of bar of the statute of limitations. The case law. In the instant case it was not bad came on for trial, and before any witnesses faith for the vendors, having made some ar- were examined, defendant asked and was rangement to secure title, to enter into a con- allowed to withdraw its plea of the statute tract of sale. Yates v. James, supra. Nor of limitations. Thereupon plaintiff being would a few days' delay in securing such called as a witness in his own behalf, de title be sufficient evidence of bad faith. fendant objected to the introduction of any Judgment reversed.

evidence on the ground that plaintiff's com

plaint failed to state sufficient facts to conWe concur: VICTOR E. SHAW, Judge stitute a cause of action. This objection was pro tem.; MELVIN, J.

sustained, and the judgment of dismissal,

from which this appeal is taken, followed. (36 Cal. App. 460)

It will be necessary to a proper underFOSTER v. LOS ANGELES TRUST & SAV. standing of the legal question presented to INGS BANK. (Civ. 2113.)

state more particularly the facts relied upon (District Court of Appeal, Second District, Cali- are expressed in the complaint. In March,

by plaintiff to sustain his suit, as the same fornia. March 4, 1918.)

1907, the plaintiff and A. W. McCready en1. Escrows ml-WHAT MAY BE PLACED IN tered into a contract executory in form as to "Escrow."

both parties, by which McCready purchased The term "escrow." ordinarily considered, applies to a deposit of deeds, ctc., and not to from the plaintiff ten motorcars, to be theremoney.

after shipped from St. Louis, Mo. The cars [Ed. Note.--For other definitions, see Words were to cost McCready in Los Angeles $2,800 and Phrases, First and Second Series, Escrow.) each. One car was to be shipped immediate 2. DEPOSITARIES 3-Rights AND OBLIGA- ly on the making of the agreement and the TIONS.

remainder, in lots of three, were to be shipWhere, under agreement between buyer and seller, money is deposited in a bank with in- ped in March, April, and June, respectively, structions to deliver it to a seller on delivery of the same year. McCready deposited with of property, the bank is an agent for both par- the defendant on account of the purchase ties, and must hold the same and pay it to the and for plaintiff's benefit the sum of $2,800, seller if there is a delivery, and the buyer if which the defendant was instructed to pay there is not. 3. ELECTION OF REMEDIES Ew3(4) – Incon- over to the plaintiff in installments of $280

SISTENCY OF REMEDIES-REMEDIES AGAINST for each car as the same was delivered. In DIFFERENT PERSONS.

May of the same year three of the cars conIn such case, the seller waives its rights tracted for were delivered to McCready and against the depositary, where on refusal of buy: were paid for in full by McCready. Thereer to accept delivery it sells the property at public auction and sues the buyer alone and upon McCready and the plaintiff mutually gets judgment for the full amount of the differ-released one another as to the sale and purence between the amount realized from the sale chase of four of the cars referred to in the and the amount of the contract price, making no account whatever of the sum on deposit; contract, and agreed further that McCready such action by the seller being inconsistent) might draw down the sum of $1,960 of the

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