Stadler v. Missouri River Power Co.

HUNT, District Judge

(after stating the facts as above). I have given very careful consideration to the evidence, and, without reciting in detail the testimony, will briefly state my conclusions in respect to the whole case:

Stadler and Kaufman, by their deed of conveyance, Exhibit A, granted to defendants, among other tracts, lot 4 in section 31, without reference to its being an island. And at law it would have made no difference in the validity of their title whether there was or was not an island of part of said lot, provided they owned it at the time of their grant to defendant. Now, defendant, having become the owner, leased back to Stadler and Kaufman lot 4, section 31, together with the other property specifically described. But in the lease, after so specifying lot 4 and the other property which they had theretofore granted to the defendant, there is included “such other land as the party of the first part now owns on the island in the Missouri River near the above-mentioned property.” The words used indicate that the parties believed that the defendant owned, or might own land “on” the island in addition to lot 4, and, if it did, the evident intent was to lease it, and it was included. The language used excludes the idea that lot 4, which was a part of a tract designated as the “Yellow Island” on plaintiffs’ Exhibit B, was included in the. general words, because lot 4 had been already described. Therefore, looking for other property as embraced within the general language, we find that defendant believed it had a claim to certain land on what was known as the “Little Island,” a tract of land lying south of and near to the lands specifically described, shown in the government maps to be surrounded by water courses, and designated therein as an island, and spoken of by some of the witnesses at the trial as the “Moran Tract,” by others as the “Little Island.” I therefore conclude that the evidence sustains the defendant in its contention that this was the land meant in the lease.

But if we assume that complainants are correct in respect to the identity of the tract described in the lease, and that it is a part of the Yellow Island, still the assumption cannot avail them under the law as it must be applied to the written contracts. It is clear that defendant wanted to acquire lands to flood as the demands of its business *322required. In accordance with this general purpose, it proceeded with the condemnation suits in the state courts. After the suits in condemnation had been tried and adjudicated, and before payment to the complainants of the sum awarded by the court, defendant and complainants entered into a contract; such contract being made up of the three distinct contracts, Exhibits A, B, and C. These agreements were made and delivered about the same time. They related to the same matters, as parts of substantially one transaction, and should be construed together, as considerations one for the other. Civ. Code Mont. § 2207; Bailey v. Railroad Co., 17 Wall. 108, 21 L. Ed. 611. The evidence shows that they were all executed for the purpose of making-permanent settlement between the complainants and defendant with respect to the acquisition of lands and the flooding of lands, and any damages, past or future, consequent upon flooding by the dam as it was then constructed or might thereafter be raised.

Examining these contracts, we find that the object of the power company in acquiring the lands (637 acres) conveyed by the Deed A was to flood them by their dam. Under the Deed A, the company has a right to flood the lands so acquired, but none other.

Through the Tease and Contract B, the complainants, for an annual rental of $1, obtained a lease for 20 years on the lands they had just theretofore conveyed, and certain other lands which it was believed defendant then owned, or claimed an interest in or ownership of; and in this same contract the defendant corporation acquired the right to flood all of the leased land, and, as an incident, all of the lands of the complainants that might be flooded by raising the dam. The considerations expressed in Exhibit B are “the rents hereinafter reserved and the covenants hereinafter contained * * * for the term of twenty years, except as hereinafter stated and limited.” The rental price of $1 was clearly nominal, and is of itself evidence of the importance of the other covenants contained in the instrument.

The reservation of the lease was as follows:

“Reserving, however, to the said party of the first part, its successors and assigns, the right at all times hereinafter to flood any or all of said premises by the waters of the Missouri River as the same may be raised by the dam belonging to the first party, at Canyon Ferry, Lewis and Clarke County, Montana, as the same now is or the same may be hereafter raised or lowered, and this lease is given subject to this right.”

By this reservation the defendant company was secured in the right to flood *the land leased to any height by the dam as it existed at the date of the agreement, or as it might be raised thereafter during the life of the lease. The court is not called upon to decide whether the right acquired by the reservation quoted reserved to the defendant the right to flood adjoining lands of complainants, if such flooding were a natural consequence of flooding the particular land leased. A reservation being interpreted in favor of the grantor (section 1473, Civ. Code Mont.), the contract under consideration might have to be so construed. But no opinion is expressed on the point, because we find the following covenant in the lease between these parties:

“And the said second parties for themselves, and each of themselves, their and each of their heirs, executors and assigns, do hereby agree to permit and *323recognize the right of said first party to flood said premises by the waters of the Missouri River as they may be raised by the dam belonging to the said first party at said Canyon Ferry, Montana, as the said dam now exists or as the same may be hereafter raised or lowered, without claim for damage.”

I construe this covenant as both a grant and a release. The words granting the right to flood the lands described in the lease as may be consequent upon raising the dam created an easement with the burden of a corresponding servitude upon the lands of complainants. The words “without claim for damage” expressly release the defendant from any and all liability for damage for flooding the lands of complainants by reason of raising the dam.

Now, when complainants agreed to permit the defendant to flood the premises described in the lease, and to recognize its right to flood them by raising the dam to any height desired, they granted a right to flood any other land, at least in that vicinity, then owned by complainants, and necessarily flooded by raising the dam, as incident to flooding the land leased. And the evidence and the contracts go to show that the power company contemplated an extensive flooding of lands, and that its agents were looking to future demands for the power to be generated by it, and it is but reasonable to regard the grant as one which could be utilized with such incidents as are necessary to the enjoyment of the right to flood the leased lands by raising the dam. Complainants consented, so far as their rights were concerned, to a right to flood by raising the dam, and they cannot now be heard to complain.

The expression of the covenant “to permit and recoznize the right of” is both permission to flood, and recognition of the right permitted, with its necessary incidents, while the words “without claim for damage” are a release from any and all damage that may be done by flooding not only the leased land, but any other land flooded by raising the dam to any height. All the parties were well aware of the fact that, if the leased lands were flooded as a consequence of raising the dam to a certain height, other lands on about the same level near by would naturally be flooded. Complainants took their chances as to the probability of defendant raising its dam. If it should not be raised, their lease was doubtless a very valuable one. If it should be raised, and their lands were flooded, it was of much less value. The presumption is that, when complainants granted the right to the defendant to raise its dam to any height desired, they granted whatever is essential to the use. Civ. Code Mont. § 4613; Bushnell v. Proprietors, 31 Conn. 157; Washburn on Easements (3d Ed.) p. 46; St. Anthony Falls Water Co. v. Minneapolis (Minn.) 43 N. W. 56.

The release was broad in its terms, and carried with it whatever was necessary to its enjoyment. Updegrove v. Pennsylvania Sch. V. R. Co., 132 Pa. 540, 19 Atl. 283, 7 L. R. A. 213; Burrow v. Terre Haute & R. R. Co., 107 Ind. 432, 8 N. E. 167. Like a grant, it is to be construed against the releasor. Jackson v. Stackhouse, 1 Cow. 126, 13 Am. Dec. 514.

There is another limitation in the lease, wdiich reads as follows:

“It is hereby mutually agreed and understood that if at any time hereafter the dam of the said party of the first part at said Canyon Ferry as it now exists or as it may hereafter be altered or changed shall be washed away so *324that it does not afford sufficient power to the said first party, that this lease shall then and there terminate.”

There was always the possibility of the work being carried away, and the agreement by which the lease should be terminated, and the land revert to the defendant in such event, goes to show that it was for flooding purposes that defendant acquired the land, and that the price paid covered the rights and easements which were incorporated in the Tease and Agreement B. Goddard on Easements, 109.

Exhibit C is really a release to the defendant for past damages, although it covers damages for future flooding, should there be any arising from the dam as it existed at the time of the execution of the release. As before stated, in my judgment the covenants in Exhibit B were intended to release the defendant company from liability for further damages on account of flooding complainants’ land by means of the dam as it then existed or might in the future be raised, while the Release C was designed particularly to release for past damages. It is to be observed that there is no limitation of time in the Release C, while B may be terminated within 20 years, and is only for the term of 20 years. The provisions of B would therefore prevail if doubt arises. The general intent of the whole contract was, I think, that B and C should relate to different conditions pertaining to the same subject; C pertaining to past damages, and B to future damages.

The learned counsel for the complainants earnestly urges the doctrine that grants by implication are not favored. It is true that many decisions to this effect may be cited. But on the other hand, it is a well-established principle that the use and enjoyment of premises granted as were the premises involved in this case necessarily imply, as an incident, the right to flood other lands, if necessary to the enjoyment of the grant, and is, in effect, a grant of such incident. It follows, therefore, that, the complainants having no right to damages as to the lands actually conveyed, the relinquishment of damages precludes their right to damages for the flooding of other lands.

The case must be determined upon the construction of the Instruments A, B, and C, and oral testimony is only possibly material to solve a question which seemed to me to be one of ambiguity, namely, what tract was referred to in the exhibits as on the island in the Missouri river.

Nor does it appear to me that the doctrine of “Expressio unius est exclusio alterius” has application to the case. The grant made by the complainants to the defendant for the purpose of flooding carries with it the right to do those things which are absolutely necessary to the enjoyment of the purpose specified and included in the grant. Civ. Code Mont. § 1250, subd. 10; St. Anthony Water Co. v. City of Minneapolis (Minn.) 43 N. W. Rep. 56; Washburn on Easements, p. 34; Lammott v. Ewers, 106 Ind. 310, 6 N. E. 636, 55 Am. Rep. 746 ; Horne v. Hutchins (N. H.) 51 Atl. 645; Baker v. Bessey, 73 Me. 472, 40 Am. Rep. 377; Hodge v. Railroad Co. (C. C.) 39 Fed. 449.

Believing, therefore, that the complainants have given defendant the right to do those things which it seeks to enjoin them from doing, their prayer for injunction is denied. Section 4606, Civ. Code Mont.