Court Opinion

ID: 8656468
Source: CourtListenerOpinion
Date Created: 2022-11-24 21:16:27.597608+00
Date Added: 2024-06-11T14:25:23.935071
License: Public Domain

FRICK, C. J.
(dissenting in part).
As stated in the opinion of Mr. Justice GIDEON the question in this case is, What were the terms of the contract entered into between the company and the plaintiff respecting the payment of plaintiff’s salary? When that is once determined nothing remains for the court to do save to enforce the terms of the contract in accordance with the settled principles of law applicable thereto.
The correspondence between plaintiff and Mr. Wolf, president of the company, is very voluminous, and large portions of it have little, if any, bearing on the principal question *618involved here. The parts of the correspondence set forth by Mr. Justice GIDEON in his opinion, and upon which he bases his conclusions, are, in my judgment, hardly sufficient to reflect the real intention of the parties to the transaction involved here. It is no easy task for any one to select from a large mass of correspondence a few excerpts which it may be said contain and adequately reflect all of the terms and conditions of a contract and the intention of the parties, as such intention appears from the whole mass of correspondence between them. Moreover, reasonable men can, and do, honestly differ respecting just what should be excerpted for the purpose of showing the real intention of the parties. While there might be dissents from the following excerpts, and more or less might be selected from the general mass of the correspondence by others, yet, in my judgment, the real intention of the parties may be gathered from the following excerpts.
The first letter referring to the reduction of the salary of the superintendent of the mine was written by Mr. Wolf, the president of the defendant company, to the plaintiff, the general manager in charge of the mine, on May 27,1913. Among other things the president wrote:
“You mentioned some time since a reduction in Nebeker’s salary pending discovery of ore. While I regret suggesting it at this time, I feel that it is necessary, and in view of your keeping in close touch as you are doing and which I trust you will continue to do, Nebeker has not the responsibility that usually pertains to his position. In some way this reduction could be made up to him as a bonus when we are again on our feet.”
Plaintiff answered that letter June 9, 1913. He, among other things, said:
“And as to myself, will do anything that is satisfactory to you. Have made arrangements with Nebeker to take $100 per month and get the balance when we get the ore.”
On July 10, 1913, Mr .Wolf wrote the plaintiff, and in that letter, for the first time, referred to plaintiff’s salary. After referring to the conditions prevailing at the mine and at home he wrote:
*619“I must now look to you for help in deferred payment of a portion of your salary of say $150. This back payment should not be exacted by either you or Nebeker until the interest is paid and enough accumulated to meet current expenses.”
Plaintiff, on July 29, 1913, answered Mr. Wolf’s letter with respect to the salaries, saying:
“Nebeker and myself are perfectly willing to accept the proposition you make as to salaries, as we both have every confidence in the outcome of the property.”
While much correspondence passed between plaintiff and Mr. Wolf after the foregoing letters were written, yet nothing material to the point in question was contained therein until a letter dated October 16, 1914, was written,, wherein Mr. Wolf, again referring to salaries, for the first time mentioned a reduction of plaintiff’s salary, in the following words:
“Have talked with Knapp and Warren about conditions at a meeting and it was ‘resolved, that under present conditions that your salary from October 1st will be reduced to $100 per month, including expenses, and that Nebeker’s salary from same date for constant services will be $125, the above being total salaries. ’ This was unanimously adopted. This we find under financial conditions to be absolutely necessary.”
On October 22, 1914, following, plaintiff wired Mr. Wolf as follows:
“I cannot accept terms in your letter October 16th. In case you dispose of my services, as it seems you are trying to do, I will insist on immediate payment of back salary.”
Two days thereafter, namely, on October 24,1914, Mr. Wolf wrote a long letter in answer to the telegram in which he said:
“I will state here that if another arrangement is made by which you will remain, and I hope there will be, the excess salary will not be allowed, as I believe under the conditions it is unbusinesslike and unfair to those who have never received a cent from the property.”
To that letter plaintiff replied on October 28, 1914, as follows:
“My proposition to you is this, I will dispense with Nebe-ker’s services and attend to things myself until such time as *620the mine warrants the getting of some one to help me, for $250 per month, and I believe I can more than earn this amount for you. Of course when the mine is in such condition that it can well afford to pay more I would expect an increase and feel that you would be willing to grant it.”
Mr. Wolf answered that letter on November 9, 1914. In the course of his letter he wrote:
“There is no doubt that the resolution passed [which, by the way, is hold here] can be changed by an increase to $150 from the amount named in the resolution, but this is the limit we can go in what I now look upon as exploration work.”
That letter was followed by a telegram from Mr. Wolf to plaintiff dated,November 23, 1914. That telegram reads:
“Suspend all operations at once for the winter. Sell all horses at best prices, also engine if possible, arrange matters so that one watchman can take care of property. Act at once pending receipt of letter. Pleased to receive suggestions. Financial conditions compel this.”
On November 25, 1914, Mr. Wolf supplemented the telegram by letter, but, in my judgment, there is nothing in that letter which is material to the controversy. On November 29, 1914, plaintiff replied to the telegram and letter of Mr. Wolf as follows:
“Do you mean that I am to exercise supervision over things while the mine is closed down; that I am to receive' $150 per month for it; or what do you mean? What arrangement do you think should now be made with reference to my back salary? A new element has been injected into the situation which would, for your accommodation, seem to call for a new arrangement respecting the payment of this back salary. I don’t want to do anything unless I have to, for my protection, to make this matter any more burdensome to you than is necessary to keep me going. What kind of an arrangement .do you want to make about this?”
Mr. Wolf, on December 7, 1914, wrote the plaintiff as follows:
“Nothing more than a nominal salary should attach to the position of manager, say $25 per month. More than this we *621cannot do. Regarding back salaries, would refer you to my letter of October 21st. There are no back salaries due until the mine produces enough to pay the interest and indebtedness and a reasonable amount in the treasury for current expenses, as per my letter of July 10, 1913, and your acceptance for Nebeker and yourself July 29, 1913.”
I refrain from quoting further from the correspondence. The mining company also produced its books in evidence from which it appears that each month, from July, 1913, to and including November, 1914, plaintiff was credited with the amount of the salary that had been agreed upon in 1906 and which had been paid to him regularly each month, to wit, $350. He was also debited with the amounts paid him on the foregoing salary as follows:
July, 1913. $ 250
August, 1913 ... 150
September, 1913 150
October, 1913 .. 150
November, 1913 150
December, 1913 200
January, 1914 . 200
February, 1914 250
March, 1914 ... 400
April, 1914 200
May, 1914. 50
June, 1914 .... . 300
July, 1914. . 150
August, 1914 .. . 200
September, 1914 200
October, 1914 .. . 300
November, 1914 . 250
Total .$3,550
It was thus conclusively proved by the defendant that from July, 1913, to and including November, 1914, plaintiff was credited with $5,825 on account of salary earned, while, during the same period of time, he was debited on account of salary only the sum of $3,550, leaving a balance unpaid according to defendant’s books of $2,275. Plaintiff claimed an amount somewhat in excess of that, but that is immaterial now.
*622The matters contained in the books of the defendant company are material only as showing how the salary matter was regarded by the company. There is, therefore, no dispute regarding the fact that, while the plaintiff during all of the months aforesaid actually earned and was credited with a salary of $350 per month, he, nevertheless, was only paid at the rate of a little in excess of $208 per month during that period of time. From both the letters and the books of the company it is, therefore, manifest that it was clearly understood by both parties that the payment of $150 of plaintiff’s $350 monthly salary should be deferred, and not that $200 was all the salary that plaintiff was earning during that period of time. The case, therefore, is not one where it is agreed between A. and B. that, in case a certain event or condition should happen, A. should be paid a salary of $350 a month, but, in ease it did not happen, he should only'receive a salary of $200 a month.
In this case plaintiff’s monthly salary was fixed at the sum of $350 but the payment of $150' of that amount was to be deferred until such time as the defendant should realize sufficient from its mine to pay the interest on its obligations and the current expenses incident to the mining operations, including the deferred portion of plaintiff’s salary. That such was the purport of the agreement in this case seems to me too clear to require further argument or elaboration. It is, however, also manifest from the correspondence that it was intended that the plaintiff should remain in the employ of the defendant company and that the company would continue to operate the mine with reasonable diligence and with a proper force in order to obtain sufficient money to pay the interest before mentioned and the current expenses of the mining operations, including that portion of plaintiff’s salary which was left unpaid. That, to my mind, is clear from the letters written both by plaintiff and the president of the defendant company. That such was the intention is also apparent from the fact that the plaintiff expressed himself as having confidence in the mine, and hence, if the mining operations were continued, the unpaid portion of his salary would soon, or at *623least within a reasonable time, be obtained from the mine. The president also expressed the same confidence in the mine and hence intended to obtain the money to pay the interest and the deferred salary from the mining operations. Both parties, therefore, intended that the mining operations should be continued indefinitely for the purposes aforesaid. Indeed, if the mining operations were discontinued the purposes expressed by both parties could, as a matter of course, not be fulfilled. To continue the working operations at the mine was, therefore, an essential part of the agreement and was the condition upon which plaintiff based his consent to defer the payment of a part of his salary each month. The question, therefore, is, What were the respective rights and duties of the parties to the agreement?
There can be no doubt regarding that phase of the case. It clearly was the defendant’s duty to continue the mining operations in good faith and with reasonable diligence in order to realize the money for the purposes before stated. On the other hand it was the duty of plaintiff to assit the defendant in accomplishing that purpose and, to that end, give the company the benefit of his experience as a mining engineer and as a mining expert so that the mineral bearing veins of the mine miglit be properly explored to the end that sufficient pay ore might be developed to meet the interest on existing obligations and the current expenses, including the payment of plaintiff’s deferred salary. If the defendant arbitrarily and without cause suspended the operations at the 'mine it clearly constituted a breach of the conditions of the contract which were clearly implied and constituted a part thereof the same as if they were expressed therein. Upon the other hand, if the plaintiff, without cause, refused to perform his part of the implied conditions before stated, his conduct would also constitute a breach of the contract. - It may be asked however — and the question is pertinent— whether the defendant was required to continue operations at the mine forever under the conditions implied, as before stated. There is only one possible answer to this proposition, which is in the negative. The law only requires things that *624are reasonable and capable of being performed. In view, however, that the defendant was constantly receiving a consideration in the form of services from the plaintiff it was required to make all reasonable efforts to continue operations at the mine and to continue them until it was manifest that the ores in the mine were exhausted, or that it was not possible with reasonable effort to obtain ore in paying quantities. The defendant was bound to act in good faith and make every reasonable effort to carry out the conditions of the agreement.
This case, therefore, falls clearly within the principle that if A. agrees with B. to discharge an existing obligation due or to become due to B. upon certain conditions, which are within the power of A. to carry into effect, but A., by his own conduct, puts it beyond his power to fulfill the conditions, or refuses to comply with a certain part of the agreement, whereby it becomes impossible for him to perform the conditions, B. need not wait for the happening of the conditions but may sue at once to enforce the contract, because A., by his acts and conduct, has breached the contract and has thus matured the obligation which, if he had complied with its terms, would not have matured until the conditions imposed thereby had happened, which might not have occurred until some time in the future. While the eases cited below are not cited as being strictly parallel, yet they clearly illustrate and apply the principle I have just stated. Teachenor v. Tibbals, 31 Utah, 10, 86 Pac. 483; Marvin v. Rogers, 53 Tex. Civ. App. 423, 115 S. W. 863; Hall v. Northern & Southern Co., 55 Fla. 235, 242, 46 South. 178; Nunez v. Dautel, 19 Wall. 560, 22 L. Ed. 161; Hood v. Hampton, Etc., Co. (C. C.) 106 Fed. 408.
In Teachenor v. Tibbals, supra, the doctrine is stated in the headnote thus:
"Where one voluntarily puts it out of his power to do what he agreed to do, in the way agreed upon, he commits a breach of contract and becomes liable generally.”
In Marvin v. Rogers, supra, the decision is correctly reflected in the headnote, and the rule is there stated in the following language:
"Where a contract is performable on the occurrence of a future event, there is an implied agreement that the promisor will place no *625obstacle in. the way of the happening- of such event, and, if he prevents the happening of the event, the contract becomes absolute.”
In. Hall v Northern & Southern Co., supra, the rule is stated thus:
“Where a bilateral contract is made for future performance, and before the time for performance arrives one party positively and unequivocally repudiates the entire contract, or voluntarily puts it out of his power to perform his part, the other party may treat the contract as rescinded. In many cases where the repudiation or voluntary act rendering performance impracticable is entire and absolute, actions may be brought as for a breach of the contract, even before the time for performance has arrived.”
It is needless to either cite more cases or to quote from them, since the foregoing excerpts sufficiently illustrate the principle that I invoke. If, therefore, the defendant company had agreed to pay the deferred portion of plaintiff’s salary “only at its convenience,” he nevertheless could have enforced payment within a reasonable time if payment'was refused. Smithers v. Junker (C. C.) 41 Fed. 101, 7 L. R. A. 264; Works v Hershey, 35 Iowa, 340.
Nor is anything that is said in the case of Johnson v. Geddes, 49 Utah, 137, 161 Pac. 910, contrary to the foregoing views. In that case the defendants had the choice of purchasing a certain mine at a certain price by paying the whole purchase price in money, or they could purchase the mine at an increased price, but if they did the latter a part of the purchase price could be paid out of the net proceeds derived from the mine. If they elected to purchase the mine at the increased price, however, they were not to become personally liable for $9,000 of the purchase price, but that sum was to be obtained from one-half of the net proceeds derived from the ores obtained from the mine. In that case the contract, however, expressly provided that in no event should the $9,000 be payable except from the net proceeds aforesaid. The principle of law that is stated in the cases I have first above cited was therefore expressly negatived in Johnson v. Geddes, supra. In other words, the parties there expressly covenanted and agreed that payment of the $9,000 in no event should be made or become payable except in a certain manner, *626and in order that payment in that manner conld be enforced a perpetual lien was created on the mine. In that case it was impossible to defeat payment of the $9,000 whether the mine was owned by the defendants or 'by anybody else, or whether the operations were continued or discontinued by the owners. If, at any time, net proceeds were derived from the mine, one-half thereof must be paid to plaintiffs or their successors by the then owners of the mine. If, however, the construction placed on the contract in question here by Mr. Justice GIDEON prevails, then it was and is possible for the defendant company, by its own act, to defeat payment of the deferred portion of plaintiff’s salary at any time after the contract was entered into either by refusing to continue the mining operations or by selling the mine. The defendant could thus obtain the services of an expert mining engineer for an indefinite length of time and could at any time cease mining operations or dispose of the mine and thus prevent the accumulation of the money with which to pay the interest referred to by Mr. Wolf and to pay the deferred, portion of plaintiff’s salary. The defendant could thus, by its own act, defeat the happening of the condition upon which plaintiff should be paid the deferred portion of his salary. This the law does not permit. Stockwell v. Gidney, 73 Me. 84.
I have inserted a part of the correspondence which passed between the parties in the fall of 1914 for the purpose only of showing that it was not intended, until the letter of October 16, 1914, was written by Mr. Wolf, that the salary of plaintiff should be reduced. Before that letter was written no change had been contemplated respecting plaintiff’s salary, except that the payment of a part thereof should be deferred. Plaintiff, however, never agreed to the reduction of his salary and hence nothing was settled in that regard when the relations between the parties were severed and this action was commenced. The fact that no reduction of plaintiff’s salary was made until in the fall of 1914, and the fact that he was always credited with $350 each month are circumstances, which to my mind, go very far to confirm the construction I have placed on the agreement between the parties.
*627Tbe only question remaining for consideration, therefore, is, What disposition should be made of this case ? I am of the opinion that upon the record as it now stands the judgment is erroneous and should not prevail. As before stated, it is clear to my mind that both plaintiff and Mr. Wolf, the president of the company, intended to continue the mining operations indefinitely for the purpose of developing ore to meet the obligations and expenses referred to in the correspondence between them. While, as before pointed out, if the defendant company by its own act prevented the happening of the conditions on which plaintiff should be paid the deferred portion of his salary, such an act constituted a breach of the contract and gave plaintiff a right of action to recover the remainder of his salary, yet the question remains whether an act which might merely extend the time of payment, if done in good faith, would also have that effect. From all that appears from the correspondence between plaintiff and Mr. Wolf it was not intended to suspend mining operations permanently, but merely temporarily. The operations were to cease only for the winter of 1914. The order was not made until November 23, 1914, when winter had practically set in. So far as the order of Mr. Wolf is concerned the suspension was, apparently at least, merely temporary. In my judgment plaintiff had no right to construe that as a breach of the contract. The defendant was only required to use reasonable diligence and make reasonable effort to continue the mining operations. It was not required to do extraordinary or unreasonable things to continue them. If, therefore, there was any sufficient reason to suspend mining operations during the winter months of 1934-15, such suspension would not constitute a breach of the contract, and forthwith mature the obligation to pay the deferred portion of plaintiff’s salary. There is nothing in the record which shows that the defendant did not in good faith, and that it did not have ample reason to, suspend mining operations for the winter. Indeed, I think the record clearly shows that the defendant had ample reasons for doing that. While, as before stated, the defendant cannot legally, by its own act, defeat the happening of the conditions, *628yet it was not required to do unreasonable things. This action was commenced within a few days after the order of suspension of the work at the mine for the winter was made. In my opinion that 'order, standing alone as it does, did not constitute an act whereby the defendant made it impossible for the conditions on which plaintiff was to be paid his deferred salary to happen, and hence did not constitute a breach of the contract. The action was therefore prematurely brought and should not prevail. While it is true that defendant did not interpose a formal plea of abatement on the ground that the action was prematurely brought, yet it constantly insisted that plaintiff was not entitled to payment, and now insists that the judgment in his favor is erroneous. For the reasons stated it is clearly erroneous. In my opinion it is, however, not erroneous for the reasons advanced in Mr. Justice GTDEON’S opinion.
While the judgment should be reversed, it should, however, be reversed for the reasons I have stated, and the cause should be remanded to the district court of Salt Lake County, with directions to dismiss the action, but to do so without prejudice to a future action so that plaintiff may enforce payment of the deferred portion of his salary in case the defendant has made it impossible for it to comply with the conditions upon which it was to be paid.