Were this a case in a court of law, the answer would be that at law a license can under no circumstances become irrevocable by estoppel when the effect would be to create an interest in land. The doctrine of equitable estoppel, although largely adopted in courts of law and frequently so applied as to render licenses irrevocable, has been held not to apply to licenses, which, if rendered perpetual, would amount to an easement in lands. The reason is a plain and necessarily conclusive one, viz.: that courts of law do not recognize mere equities, such as arise out of an equitable estoppel enforced against the legal owner of lands; but they deal only with legal estates, such as are acquired through legal forms of conveyance, or their equivalent under the statute of limitations, an adverse possession, of twenty years, or at least by writing under the statute of frauds. Hence, a mere license affecting lands is at law always revocable, even though granted for a valuable consideration, as in Fentiman v. Smith, 4 East, 107, and Wood v. Leadbitter, 3 M. & W. 833, and although the licensee may have expended money under it, which was a feature of many of the cases before cited.
It is true, however, that in this court, equities in land though not created by any deed, grant or writing whatever, but springing out of the acts and relations of the parties, are largely enforced, and among these a large class are those which arise under the doctrine of equitable estoppel applied to prevent constructive fraud, - as where one having title to land is knowingly silent in the presence of an innocent purchaser from a third person, or where one knowing his title to land silently permits another ignorantly to build on it, - in these, and in like cases, this court, in order to prevent fraud, will raise out of the transaction an equity in favor of the party misled, binding the conscience of the owner and restraining the exercise of his legal rights against such party. No reason is perceived why, in a proper case, the same principle should not in equity restrain the revocation of a privilege affecting the use of land. But it must be carefully observed that this principle of equitable estoppel proceeds upon the ground of preventing fraud. Its effect, when applied, is to restrain a party from exercising his legal right, and this even a court of equity cannot do unless there have been on his part some conduct, declaration or improper concealment, misleading an innocent person to his prejudice and rendering the assertion of the legal right as against such person an act of bad faith, amounting to constructive fraud. Moreover, it may be well added that to warrant the interference of the court with the legal right or title of a party, the case relied on to work the estoppel must be clear, beyond doubt, upon the facts. And the more stringently do these rules apply in a case such as this, where the effect of the estoppel, if allowed, will be to convert what was originally a bare privilege, temporary and revocable, into an easement in the licensor's land, perpetually binding it as transmissible from the licensee.
It is a fatal infirmity in this branch of the complainant's case that there was nothing in all the communications had between the officers of the Company and Jackson & Sharp, or in the conduct of these officers, to justify Jackson & Sharp in assuming that the company, by granting the accommodation applied for intended to relinquish any right of property in the soil. It is agreed that no stipulation or promise to that effect was expressed. * * * Looking to all the circumstances of the case, it is my conviction that although the connection of the car works with the railroad was doubtless contemplated on both sides as one to be in fact permanent, yet that no stipulation to that effect was asked or given, or supposed by either party to have been given; but that the arrangement was tacitly left to rest upon the general understanding with respect to such accommodation, Jackson & Sharp either not anticipating the contingency which has now happened, or trusting to the mutual interest and good will of the parties as a sufficient guarantee for the permanence of the connection, without securing it as a legal right according to prescribed forms of law. Their disappointment certainly involves them in no little hardship. But hardship is not a ground for equitable relief, except in favor of one who, without any negligence in securing his rights by the appropriate legal modes, has been misled to his prejudice through some fraud or laches of the party against whom the relief is sought, or by such conduct of the latter as renders it an act of bad faith to take advantage of the mistake.
The injunction must be dissolved and the bill dismissed. [law of prop in land. - 51.]
c. Cases where licensee has paid consideration, or has incurred expense in executing the license and there is no positive fraud.
129 New York, 604. - 1892.
Andrews, J. - This case presents a question of importance from the principle involved, although the particular interest affected by the decision is not large.
The action was brought to obtain equitable relief by injunction to restrain the defendant from tearing down a stone wall erected on the defendant's land by the plaintiff, under an alleged parol license from the defendant, and in the erection of which the plaintiff expended in labor and materials a sum exceeding one hundred dollars. The parties are the owners of adjoining lots fronting upon a public street. The plaintiff's lot is west of the lot of the defendant. The land in its natural state descended toward the east. In 1886 the plaintiff graded his lot. and in so doing, raised an embankment several feet high along his eastern line, adjacent to the lot of the defendant, and erected a house on his lot. In 1887 the defendant graded his lot and excavated the earth up to his west line, adjacent to the embankment on the plaintiff's lot, to the depth of four or more feet, thereby removing the natural support to the lot of the plaintiff as it was in its orginal state. Before the defendant had completed his excavation, the parties had an interview and the question of the support of the plaintiff's embankment arose. The plaintiff claimed that the defendant was bound to build a wall where his excavation was. The defendant denied his obligation to do so and referred to the fact that the plaintiff had raised his land several feet higher than it was in its natural state. The plaintiff wanted the defendant to sell him two feet of his land to build a wall upon, which the defendant declined to do. * * *