1110 SMITH V. THOMAS. [169 SMITH V. THOMAS. Opinion delivered December. 21, 1925. 1. COVENANTS—WHEN RIGHT OF ACTION ACCRUES.—A right of. action for breach of a covenant against incumbrances aécrues immediately upon the execution of a deed. 2. COVENANTS—MEASURE OF DAMAGES.—The measure of damages for breach of a covenant against incumbrances is the amount necessary to remove the incumbrance, not exceeding the consideration expressed in the deed, and the covenantee must first discharge 'the incumbrance by payment unless he has actually lost the estate in consequence of the incumbrance. 3 COVENANTS—INCUMBRANCE—ENLARGEMENT OF DAMAGES.-011 a breach of a covenant against incumbrances in the sale of timber, in that there was a lien against the land for delinquent taxes, the covenantee's right of action accrued immediately to the breach, and he could not enlarge the amount of his recovery by permitting the lien to be foreclosed.
ARK.] SMITH V. THOMAS. 1111 4. COVFINANTSDAMAGES FOR BREACH.—Where a covenant against incumbrances in the sale of timber was breached by a sale, of the land for delinquent taxes, the measure of the grantee:s, damages Was : the value of the timber which he could have remoVed after g lich tax sale, less the value of the timber whiCh he did in fact : reniove, not exceeding the amount of -the incumbrance. 5.. COVENANTS BREACH = EVIDENCE.—In an action by a purchaser of • timber for breach of : a covenant against incumbrances :by reason of the land being sold for delinquent taxes, refusal to admit evidence tending to show interference from other canses 'with the removal of the ' timber within the time specified in the deed was • ertOr.- ' Appeal from White Circuit Court ; E. b. Robertson, Judge ; , reversed. • Ertilytidge & Nee4y, for appellant. John E: 1114ler, for appellee. , McCuLLocn, , C. J. This is an action instituted by ap-pellee against appellants L., A. Smith and J. F. Watkins and R.L, Plant to recover on breaches of warranty in the sale ,of . :the timber on certain, lands in, White County. Smith and Watkins were•the owners of the land, and conveyed:the timber to R. L. Plant with covenants of warranty, and Plant in turn conveyed to appellee with like covenants. The deed from Smith and Watkins to• Plant was dated December 9, 1919,:reciting a consideration of $800, cash in hand paid, and giving the grantee two years from that date , within which to cut and remove the timber. . The deed from Plant to appellee was dated December 10, 1919, reciting a consideration of $1,000, cash in hand paid, and giving:two years within which to.cut and remove the timber. There was no failure of title, but it appears from tbe :testimony that the lands were situated within the boundaries- of I an improvement district called Little Red River. Levee District, and that at the time of the ,execution of, each of the deeds there was a lien on the,lands for-delinquent, levee taxes aggregating aVout the sum of $272. • , Appellee entered upon the : lands pursuant to: his purchase from Plant and proceeded to remove the timber, and did in fact remove a ,considerable portion of it;, but there was a considerable portion of the timber left on the
1112 SMITH V. THOMAS. [169 land at the expiration of the time given in the deed for its teinoval. On February 4, 1921, the comniisSioners of the levee districtinstituted an action in. fon, in the chancery court to enforce its lien for delinquent taxes on this and other lands in the district. A foreclosure decree was rendered by the chanery court, and these Ian& were sold bya coin-enissioner and rairchased by the levee district, there being 40 ether bidder. The sale was cenfirmed on june9, 1921, but no deed was executed by the commissioners,for, the reason that the period of redemption had not , expired up to the time this case was tried below. • Appellee testified that he removed frOin , the land 76,000 feet of timber of the Value Of VAT' . dollars pet thousand, and that he also sold to a man nained ItnOX 18,000 feet, the price for the sale to Knox 'being $2.60 per thousand, and that there 7as left on the land at the expiration of the tithe:all6wed fdi reinoVal, abditt 285,000• feet." The testimony intrOduced by the defendants WaS to the c6ct that : there was only abOut 156,000 feet of Merchantable tiMber on the land at the time of the eiecn.fion Of the deeds. — , The testimony on the 'part of appellee was that KnOx was working on the land remoVing timber in September and' October, 1921,' but that there waS an 'interference 'With the tenioval of all . the El:libel' on the land withiri 'the tii6 limit : on aeconnt of the demand Made upon 'hirn by the attorney for the levee distrid to stOP cutting.' There Was , an action brought against him by the levee district, after the 'confirmation Of the commissioner's sale, to restrain the cutting and remoVal of timber, but nO injunction granted. The cOurt sustained a defnurrer"tO the complaint in that case, and there was an appeal to this court, and this court reversed the decree, holding that a case was stated in the complaint, and that the cOurt erred in sustaining the demurrer. Little Red River Levee District v. Thovias, 154 Ark. 328. This decision Was rendered after the e'xpiratioli of the time limit in the deeds execlited by the defendants.
SMITH V. THOMAS. 1113 ,The , defendants also offered , testimony,, which the court excluded, tending to Olow that, on account,of„high water and the . delay. in appellee's effort to remove, tlie timber, it could not have been removed within the ,time, limit after the date that appellee ceased operations in October, 1921. , The court refused all of:the instruction§ requested by the defendants :and . gave. , the following peremptory instruction . : ..• . . . • . .."No. 1. You. are instructed that,under the law:you should return a verdict for the plaintiff against the, de.-. fendants, L. A.:Smith and J. E. Watkins; fpr the, amount they.:sold the ,timber , to Plant for and interest thereon .from.pecember 10, , 1919, at six ,per.,cent. ;less: stumpage value. of:the timber removed by . plaintiff; and your verdict should be; for the plaintiff against tbe, jefeAdant, Plant; for the Amount he received for. the . timber,:and the interest thereon less the: stumpage value:of the timber removed by plaintiff." . • , .. The . jury returned a •verdict .in, favor ;.of .appellee against Smith and Watkins. for recovery: of A N , sum. of $628.63,•and.they have appealed.. ,The jury also .returned a . verdict against Plant in the sum o , f $26 . .80, hut no appeal has been prosecuted by Plant. , We are of the :opinion that the courrerre.d in its,instruction. •There was no failure of title, therefore there was only a breach of the covenant against.incumbranceS, and the rightof action for the breach accruedimmediately upon.the execution of:the deed.. JeromeHardywod Lu/r4i ber Co. v. Munsell, ante. p. 201. : • ., • . In Kahn v. Cherry, 131 Ark. 49, we said: . ``-A,covenant against incumbrances in a deed is;one . in posenti. If an incumbrance exists, the covenant is brokenas 'soon as made. The breach, of such co7enant •is single, 'entire and perfect in the first instance; and the . right of ,action accrues at once." . The measure of damages for the breach of a covenant against incumbrance is the amount necessary move the incumbrance, not exceeding the consideration expressed in the deed containing the covenants of 'war,-
1114 SMITH v. THOMAS. [169 ranty, and ordinarily the covenantee cannot recover on the mere existence of the incumbrance, but must first discharge it by' payment, unless he has actually lost the estate in consequence of the incumbrance. In 7 R. C. L. p. 1104, the rule is stated as follows : 'In a number of jurisdictions it has been held that, although 'a covenant against incumbrances, like a covenant of seisin, is broken if at all as soon as made, yet the covenantee' can found no right to actual damages on the mere existence of incum-brances, but willbe limited to a nominal recovery, unless he has paid off the incumbrance or actuallY lost the estate in consequence of it." In the present case it is'undisputed that appellee did not remlove the , incumbrance by payment, but the testimony which he adduced tended to show that he lost a portion of the timber in consequence of the incumbrance. The testimony offered by aPpellants, and excluded by the court, tended to• show that the remainder of the , timber could not have beeli removed after the time appellee ceased operations. The maximum of appellee's. reCovery was, as we have already said, the amount necessary to remove the incumbrance. 'His right of action accrued immediately on the breach, and 'he eould not enlarge the amount of his recovery by delay until after the foreclosure. • Appellee had no legal right : to cut and remove' the timber after the confirmation of the commissioner's sale (Little Red River Levee District v. Thomas, supra), and the measure of his right of recovery is the' value of the timber. which he could have removed after that time less the value of the timber that he did, in fact, remove, not exceeding the amount of the incumbrance. In other words, he was entitled to recover the value of the timber which he was prevented from removing by the foreclosure sale, not exceeding the amount of the incumbrance. The court should have admitted evidence tending to show interference from other causes with the removal of the timber within the time linilt specified in the deed. For the errors indicated the judgment is reVersed, and the cause remanded for a new trial.
You are being directed to the most recent version of the statute which may not be the version considered at the time of the judgment.