Lord Eldon, indeed, distinguished ///// v. Barclay from Sanders v. Pope,
on the ground that in the latter case, there had been no demand, or notice,
given to repair ; but it was held, in Bracebridge v. Buckle?/, that, in the
absence of any stipulation in the lease rendering a demand or notice necessary,
it is immaterial; for, as observed by Thompson, C. B., "If a man covenant
to do an act within a certain time, no demand is necessary; and a neglect of
performance is tantamount to a refusal in law :" 2 Price, 213. In Hill v.
Barclay, as observed by Graham, B., and Thompson, C. B., the landlord was
partly obliged to give notice by the terms of the covenant, which, in that re-
spect, was particularly worded : 2 Price, 228-230.

It has not been decided whether under a general covenant to repair, notice
from the landlord to repair is necessary; it is, however, presumed, that, as it
is not necessary on a covenant to insure, (Rolfe v. Harris, 2 Price, 206-20*. » ;
Green v. Bridges, 4 Sim. 96,) it is immaterial. See Hill v. Barclay, 18
Ves. 62; Job v. Bannister, 3 Jur., N. S. 93, 26 L. J. (Ch.) 125.

If, however, by unavoidable accident, by fraud, by surprise, or ignorance
not wilful, parties may have been prevented from executing a covenant lite-
rally, a court of equity will interfere, and, upon compensation being made,
the party having done everything in his power, and being prevented by the
means alluded to, will give relief: (per Lord Alvanley, M. R., in Eaton v.
Lyon, 3 Ves. 693 ;) because, although at law a covenant must be strictly and



PEACHY V. DUKE OF SOMERSET. — SLOMAN V. WALTER. 663

literally performed, in equity it will suffice if it be really and substantially
performed according to the true intent and meaning of the parties, so far as
circumstances will admit. And see Hill v. Barclay, 18 Ves. 62, where Lord
Eldon expressly guards his observations, which are strongly against relief
being granted in ordinary cases, from being taken to apply to cases of acci-
dent and surprise ; the effect of the weather, for instance, in that case, or
permissive want of repair, the landlord standing by and looking on. See
Ilunnon v. South London Waterworks Company, 2 Mer. 61.

Upon this principle, the decision in Wing v. Harvey, 5 De Gr. Mac. & Gr.
265, proceeds. There a life policy was subject to a condition, making it void
if the assured went beyond the limits of Europe without license. An assignee
of the policy, on paying the premium to *a local agent of the Assur-
ance Society at the place where the assurance had been effected, in- L J
formed him that the assured was resident in Canada. The agent stated that
this would not avoid the policy, and received the premiums till the assured
died. It was held, by the Lords Justices, that the society was precluded from
insisting on the forfeiture. See also Dulce of Beaufort v. JVeeld, 12 C. & F.
248.

But although relief may be obtained in equity against a forfeiture where a
person incurring it has been misled by the person legally entitled to insist
upon it, a subsequent distinct forfeiture, where no such excuse can be alleged
may be taken advantage of, as the Court will have no ground for its interfer-
ence. Thus, although relief may be had in equity against a forfeiture of a
lease during a period when the landlord dealt with the tenant so as to lead
him to suppose the forfeiture would not be insisted on, if a subsequent for-
feiture is incurred after such dealings have ceased, the prior transaction will
raise no equity for relief. Flattery v. Anderdon, 12 Ir. Eq. Rep. 218.

In the case of a lunatic's estate, relief will be given to a tenant who has
incurred a forfeiture, if it were beneficial to the lunatic not to insist upon it.
Thus, in Ex parte Vaughan, T. & R. 434, the tenant of a lunatic's estate
upou petition was relieved against an ejectment brought by the committee,
founded on a forfeiture, by breach of covenant to repair. Pitt v. Reynolds
was cited against the petition. But Lord Eldon said, that there were for-
feitures arising from breaches of covenant against which courts of equity could
not relieve, but which a judicious landlord would not take advantage of. The
case which had been cited would not apply if the question was, whether that
were a case in which the landlord, acting from himself, would not have taken
advantage of the forfeiture ; and that care must be taken not to get rid of a
good tenant by being too strict.

It is clear that a court of equity will not grant any relief against proceed-
ings at law, where a tenant has committed a breach of covenant by omitting
to insure, even if he has made a considerable expenditure in improvements ;
and the omission to insure is stronger against the tenant than the omission to
repair, because in the latter case, the landlord may, by exercising due vigi-
lance, see to the observance of the covenant ; but in the former, where the



064 PENALTIES. — FORFEITURES. — LIQUIDATED DAMAGES.

lessee has undertaken to keep insured, the landlord must rely upon him for
the fulfilment of his obligation ; see Reynolds v. Pitt, 19 Ves. 134 ; Brace-
bridge v. Buckley, 2 Price, 218; White v. Warner, 2 Mer. 459; Green v.
Bridges, 4 Sim. 96; Gregory v. Wilson, 9 Hare, 683.

A covenant, however, by the lessee to insure the demised premises
L J1 'J *} n t ne names of himself and the lessor, although not literally per-
formed, by an insurance in the name of the lessor only, is yet so far substan-
tially performed for the benefit of the lessor, that he could not recover for a
breach of the covenant, the stipulation for the insurance in the name of the
lessee being for the exclusive benefit of the latter, he is at liberty to dispense
â– with it. Havens v. Middleton, 10 Hare, 641.

Equity will not relieve a lessee, who, contrary to his covenant, does not
cultivate land in a husbandlike manner, (Mils v. Rowland, 4 De G\ Mac. &
G\ 430,) or who carries on a trade without a license, (Maclier v. The P&wnd-
ling Hospital, 1 V. & B. 187 ;) nor a lessee who assigns without license ; " for,
he cannot," observes Lord Eldon, " show that, by the assignment, the lessor
sustains no damage ; that, on the contrary, he, the lessee, is a beggar, who
could not pay the rent, and the assignee a solvent tenant; that the lessor is
therefore in a better condition, having two persons answerable to him instead
of one tenant, under the circumstances I have mentioned. The answer is,
that the Court cannot estimate the damage. The fact, as it is alleged, may
be true at this moment; but the consideration, whether the lessor is to gain
or lose by having a tenant put upon him, must run through the whole con-
tinuance of the lease : it is sufficient that the lessor insists upon his covenant,
and no one has a right to put him in a different situation :" Hill v. Barclay,
18 Ves. 36 ; and see Wafer v. Jlocato, 9 Mod. 112 ; Wadman v. Calcraft, 10
Ves. 67; Lovat v. Lord Ranelagh, 3 V. & B. 24 ; BracebridgeV. Buckley, 1
Price, 200, 221. Upon the same principle, in Descarlett v. Dennett, 9 Mud.
22, Sir Joseph Jekvll, M. 11., refused to relieve a lessee, who, contrary to a
particular covenant which he had entered into, not to suffer persons to make
use of a way over part of the lands demised, had put up a gate at the entrance
of the close, and permitted any person to pass over the way, requiring them
to pay. " For the Chancery," said his Honor, " cannot relieve the non-per-
formance of a covenant or condition, the prejudice in breach of which cannot
be estimated by damages. This tends to the prejudice of the inheritance,
inasmuch as it may hereafter amount to an evidence for a prescription over
the close. The case of an entry for non-payment of rent is very different ;
for there the loss is certain, and may be recompensed by damages. This has
been a settled rule in equity;" and see Bracebridge v. Buckley, 2 Price, 221,
where this case is approved of.

"Where, in public undertakings, there is a stipulation that share-holders, on

non-payment of calls, shall forfeit their shares, equity, upon grounds of public

r*qiQ-i P°li c y> aQ d *from the necessity of the punctuality, in payment in

such cases, will refuse to interfere, and grant relief upon forfeiture.

Thus, in Sparks v. The Company of the Proprietors of the Liverpool Water*



PEACHY V. DUKE OF SOMERSET. — SLOMAN V. WALTER. 665

works, 13 Ves, 428, Sir William Grant. M. R., refused to relieve against a
forfeiture under a bye-law of an incorporated Company for water works, which
provided, that the members receiving notice of default in paying a call should
incur forfeiture by non-payment ten days after, although the non-payment
arose from ignorance of the call, absence from town when the notice was sent,
and other accidental circumstances. " This bill, said his Honor, " is founded
in forfeiture, and upon the ground, that the plaintiff did not consider himself
as a partner, and offering compensation, and praying to be relieved from the
forfeiture. The parties might contract upon any terms they thought fit, and
might impose terms as arbitrary as they pleased. It is essential to such
transactions. This struck me as not like the case of individuals. If this
species of equity is open to parties engaged in these undertakings, they could
not be carried on. It is essential that the money should be paid, and that
they should know what is their situation. Interest is not an adequate com-
pensation, even among individuals, much less in these undertakings. In
particular cases interest might be a compensation, but in the majority of cases
it is no compensation, from the uncertainty in which they may be left. The
effect is the same, whether money has been paid or not. They know the con-
sequence ; the party making default is no longer a member ; but if a party
can in equity enter into a discussion of the circumstances, each may bring his
suit. They must remain a considerable time, to see whether a suit will be
begun, and before the suit can be decided. They do not know when any
member will sue. If a bill is to be permitted, there cannot be any certainty
that every member who has made default may not file a bill. Can the Court
impose a limitation of the period when bills may be filed ? If the Court ever
began to deal with these cases, the number must be infinite. This is the
mode which a party has to withdraw from a losing concern. Why is not this
equity open to contractors for the government loans ? Why may not they
come here to be relieved, when they have failed in making their deposit ?
And if they could have relief, how could government go on ? It would be
just as difficult for these undertakings to go on. If compensation cannot be
effectually made, it ought not to be attempted. It would be hazardous to
entertain such a bill. Accident here is only the want of precaution. The
plaintiff did not inform himself of the orders and rules of *the Com- pgxg-j
pany. It was easy for the plaintiff to direct the secretary to send the
notices as he pleased. The Court cannot relieve against such accidents.
The plaintiff ought to have taken all due pains to inform himself." His Honor
afterwards mentioned a late instance in Ireland of a person who, after having
paid some instalments on a loan, neglected to make a further payment, and
forfeited the instalments he had paid. He petitioned Parliament for relief,
but without success. With reference to this case, Mr. Eden, in his work on
Injunctions, p. 22, note (6), observes, that there is a case in the Hargrave MSS.,
in which Lord Harcourt relieved a member of a benefit society against a for-
feiture incurred by neglecting to pay the weekly instalments ; but that the
reasoning of Sir W. Grant is so conclusive and satisfactory, that it is probable,



666 PENALTIES. — FORFEITURES. — LIQUIDATED DAMAGES.

if the question should ever be agitated again, that his decision would be
adhered to. See Prendergast v. Turton, 1 Y. & C C. C 98, 110, 111, 112 ;
Naylor v. South Devon Railway Company, 1 De G. & Sm. 32; Sudloic v.
The Dutch Rhenish Railway Company, 21 Beav. 43.

The principle applicable to cases of contract between the parties, is not
applicable to the provisions of an Act of Parliament or conditions in law.
For although, as we have seen, in cases of contract between parties, equity
will often relieve against penalties and forfeitures, where compensation can
be granted, relief against the provisions of a statute can never be given :
Keating v. Sparrow, 1 Ball & B. 367, 373, 374 ; and it seems, that in the
absence of any fraud or acquiescence on the part of the lord, the Court, as
was decided in the principal case, cannot relieve, in the case of the forfeiture
of customary estates and copyholds, by acts of the tenant, contrary to the con-
tract imposed upon him by the law: Hill v. Barclay, 18 Yes. 64. See,
however, and consider the cases cited in the principal case of Peachy v. Duke
of Somerset, in which relief was granted.

As, on the one hand, a court of equity will give a person relief against a
penalty, where it is only intended to secure the performance of the contract,
so, on the other hand, it will not permit him to resist specific performance of
the contract, by electing to pay the penalty. "Where, however, the real in-
tent of the contract is, that a person may, if he chooses, do certain acts, upon
payment of an additional sum of money, in such case, as the agreement for
payment of an additional Bum is not intended to secure the performance of
any other contract, but is a contract which the parties are at liberty to make,
a court of equity will neither relieve him from payment of the additional sum
i-*Q9m agreed upon, on doing such acts, although it may bear the *appearance
of a penalty, nor, on the other hand, will it compel him to abstain from
them. The principle upon which the Court acts is sufficiently clear, though
its application, which, in fact, depends upon the construction of the contract,
is often attended with some difficulty. It is well explained by Lord St. Leo-
nards, in an important case. " The general rule of equity," he observes, " is,
that, if a thing be agreed upon to be done, though there is a penalty annexed
to secure its performance, yet the very thing itself must be done. If a man,
for instance, agree to settle an estate, and execute his bond for £600, as a
security for the performance of his contract, he will not be allowed to pay the
forfeit of his bond and avoid his agreement, but he will be compelled to settle
the estate in specific performance of his agreement. So, if a man covenant
to abstain from doing a certain act, and agree, that, if he do it, he will pay a
sum of money, it would seem that he will be compelled to abstain from doing
that act; and, just as in the converse case, he cannot elect to break his
engagement by paying for his violation of the contract. . . . The question
for the Court to ascertain is, whether the party is restricted by covenant from
doing the particular act, although if he do it, a payment is reserved ; or whether,
according to the true construction of the contract, its meaning is, that the one
party shall have a right to do the act, on payment of what is agreed upon as an



PEACHY V. DUKE OF SOMERSET. — SLOMAN V. WALTER. 667



equivalent. If a man let meadow land for two guineas an acre, and the con-
tract is, that if the tenant choose to employ it in tillage, he may do so, paying
an additional rent of two guineas an acre, no doubt this is a perfectly good
and unobjectionable contract; the breaking up the land is not inconsistent
with the contract, which provides, that in case the act is done, the landlord
is to receive an increased rent :" French v. Macale, 2D. & War. 274.

That a person must perform an agreement, whether to do or refrain from
doing a particular act, where the intent, although there be a penalty annexed,
is to secure its performance, see Howard v. Hopkyns, 2 Atk. 871 ; Chi/liner v.
ChilUner, 2 Ves. 528 ; City of London y . Pugh, 4 Bro. P. C. 395, Toml.
edit. ; Hardy v. Martin, 1 Cox, 26; Roper v. Bartholomew, 12 Price, 796 ;
Logan v. Wienholt, 1 C. & F. 611; French v. Macule, 2 D. & War. 269;
Carden v. Butler, 1 Hayes & J. 112.

As before observed, we must carefully distinguish between the cases where
the penalty is merely for the purpose of securing the performance of the
agreement, and those cases where a sum is agreed upon by the parties, to be
paid as the price for doing or refraining from doing a certain act. Thus,
*where, in leases, a person covenants not to do an act, as to plough r^q^-i
pasture land, or to cease to reside on the premises, but if he does, to
pay an additional rent, a court of equity will look upon the additional rent
not as a peualty, but as liquidated damages fixed upon by the parties, and
will not give relief. Rolfe v. Peterson, 2 Bro. P. C. 486, Toml. edit., is the
leading case on this subject. There the lessee covenanted not to plough up
any of the ancient meadow or pasture ground ; and if he did, to pay an
additional rent of £5 per acre. Lord Camden looked upon the additional rent
as a penalty, and decreed that the tenant should be relieved, and directed an
issue quantum damnificatus ; but the House of Lords overruled the decree.
Of this case it has been well marked by Lord Rosslyn, in Hardy v. Martin,
1 Cox, 27, " that it was the demise of land to a lessee to do with it as he
thought proper ; but if he used it in one way, he was to pay one rent, and if
in another, another ; that is a different case from an agreement not to do a
thin - , with a penalty for doing it." And see Ponsonhy v. Adams, 2 Bro.
P. C. 431, Toml. edit.

And upon the principle, that, the real meaning in such a contract is, that
a party may do a particular act upon payment of an additional sum, the court
of equity has properly refused to restrain, by injunction, the person from
doing the act by which the additional sum becomes payable. Thus, in Wood-
ward v. Gyles, 2 Vera. 119, the plaintiff let a farm to the defendant at an
annual rent, and, part of it being pasture land, covenanted, amongst other
things, not to break up or plough any part of it; and if he did plough any
part of it, he would pay after the rate of 20s. an acre. But the Court held,
that the parties had themselves set a price for ploughing, and therefore would
not arant any injunction, and declared that, if the defendant were plaintiff
against paying the 20s. per acre for ploughing, they would not relieve him.
And see Forbes v. Carney, Wallis, Eep. by Lyne, 38 ; and Jones v. Green,



068 PENALTIES. — FORFEITURES. — LIQUIDATED DAMAGES.

3 Y. & J. 298. See Sainter v. Ferguson, 1 Mac. & G-. 286 ; 7 C. B. 716;
Cass v. Thompson, 5 W. R. 289.

And upon the principle that stipulated damages are not in the nature of a
penalty, a person who by doing, or abstaining from doing an act, which under
his contract subjected him to the payment of such damages, would not be
able to protect himself against discovery. Thus, in Jones v. Green, 3 Y. &
J. 289, by an indenture a farm and lands were demised to a tenant at a yearly
rent, and also under and subject to certain yearly payments, in case the tenant
should not crop, manure, and manage the farm in manner therein specified
r*Q991 anc ^ covenanted ; and also in case the tenant, in the *last three years
of the term, should sow more than 70 acres of clover in one year, the
additional rent of £10 an acre for every acre above seventy acres for the re-
sidue of the term. It was held, that the additional rents were in the nature
of liquidated damages, and not of penalties; and therefore, on a bill filed by
the landlord for a discovery of breaches of the covenants, in aid of an action
at law, a plea that the discovery might subject the tenant to penalties was
overruled.

And the Court will not infer, from the fact of the additional sum reserved
upon doing or not doing a particular thing being disproportioned to the
damage which results therefrom, that it is in the nature of a penalty. See
Chillinerv. Chittiner, 2 Ves. 528; Roy v. Duke of Beaufort, 2 Atk. 190;
Logan v. Wicnholt, 1 C. & P. 611 ; and see French v. Macule, 2 D. & War.
280, disapproving of Burne v. Madden, L. & G. t. Plunk. 493.

The Court may, however, relieve against the additional rent, if the landlord
has acquiesced in the acts of the tenant ; but it must be remembered that it
will not in general interfere against the legal effect of a covenant : there must
be fraud, such as acquiescing for a benefit to arise from taking advantage of
the breach, or giving reason to suppose that there would not be any inter-
ference. See Barret v. Blagrave, 6 Ves. 104 ; Williams v. Earl of Jersey,
Cr. & Ph. 91 ; Dann v. Spurrier, 7 Ves. 231 ; Jackson v. Cator, 5 Ves.
688 ; Macher v. The Foundling Hospital, 1 V. & B. 188 ; Hume v. Kent, 1
Ball. & B. 188; Gerrard v. O'Reilly, 2 C. & L. 165 ; 3 D. & War. 414.

Upon this principle partly, Lord Ilardwicke appears to have decided in
Roy v. The Duke of Beaufort, 2 Atk. 108.

We have hitherto considered cases with regard to forfeiture, where a legal
relation, as that of lessor and lessee, existing between the parties, the remedy
of the former to enforce the forfeiture is at law. Where, however, there is a
mere contract for a lease, which can only be enforced in equity, how far will
a court of equity interfere on behalf of the lessee where there have been acts
on his part, which if the lease had been granted according to the contract,
would amount to a forfeiture at law ? It seems that where a lessee has done
such acts, the courts of equity, in the exercise of their discretion, will refuse
specific performance of the contract upon a bill filed by the lessee, for it would
be useless to require the execution of a lease when it might be immediately



PEACHY V. DUKE OF SOMERSET. — SLOMAN V. WALTER. 669

determined. Gourlay v. The Duke of Somerset, 1 V. & B. 68, 72 ; Gregory v.
Wilson, 9 Hare, 683, 687 ; Lewis v. Bond, 18 Beav. 85.

A strong case, however, is necessary to be made on the part of the defen-
*dant, for the Court, in refusing specific performance, prevents the r^ao^i
question of forfeiture from being tried at law ; and therefore, before " ^
it, refuses its interference, it ought to be well satisfied that there has been a
forfeiture on which an ejectment could be maintained : per Sir George Turner,
V. C, 9 Hare, 691.

Where specific performance of an agreement for a lease is decreed, not-
withstanding it is doubtful whether breaches of covenant have not taken
place which would enable the lessor to re-enter, the Court will direct the
lease to be dated at a period antecedent to the alleged breaches, and will re-
quire from the plaintiff an undertaking to admit in any action that the lease
was executed on the day of its date. Pain v. Coombs, 1 De G. & J. 34.

Where there is no clause of re-entry for breach of a covenant, as, for in-
stance, a breach of a covenant to repair, the Court will not refuse specific
performance of a covenant to renew a lease, merely because there is a breach
of the covenant to repair, for the lessor may recover damages at law for the
breach. Hare v. Burges, 5 W. R. 585.

Specific performance will be decreed of a contract to sell the fee where it is
independent of a contract to grant a lease, a forfeiture of which has been in-
curred by the acts of the plaintiff, although the two contracts may be con-
tained in the same instrument. Thus, in Green v. Low, 22 Beav. 625, the
defendant agreed to grant a lease of a plot of ground to the defendant upon
his building a villa of a certain value thereon, which he was to keep insured
in the joint names of himself and the defendant in a particular office. And
it was also agreed, that if the plaintiff should not perform the agreement on
his part, the agreement for a lease was to be void, and that the defendant
might re-enter. The agreement contained a further stipulation, according to
which the plaintiff was to have the option of purchasing the fee within two
years. The plaintiff erected the villa but insured in the wrong office, and in
his own name only. It was held by Sir John Romilly, M. R., that the right
to purchase being independent of the right to a lease, the plaintiff was
entitled to specific performance of the contract to sell to him the fee.



Nothing is better settled, than that legally incurred by the oppo ite party ;
whenever the injury inflicted by a Hackett v. Alcock, 1 Call, 463 ; Wal-
breach of contract, is susceptible of ker v. Wheeler, 2 Conn. 299 ; Bow-