Court Opinion

ID: 3307091
Source: CourtListenerOpinion
Date Created: 2016-07-05 17:21:34.18327+00
Date Added: 2024-06-11T13:29:50.382874
License: Public Domain

Defendants' demurrer to plaintiff's amended complaint was sustained without leave to amend. From the judgment following such order the plaintiff appeals.
The theory of the amended complaint is that the transactions described therein were such as created a mining partnership between plaintiff and defendants; that appellant held the property of said partnership in trust and that he was entitled to a lien thereon for certain advances made by him. The complaint avers substantially the following facts:
McGregor and Lewis owned a certain described mining claim in Sierra County. This was and is an unpatented lode mining claim possessed by virtue of a location made in 1895 in accordance with the mining laws of the United States and *Page 185 
the local rules then in force in that county. The claim was of such a nature that large sums of money were required for its development.
On December 24, 1896, McGregor and Lewis entered into a written agreement with Harper, the plaintiff in this suit, whereby the said Harper was to work and develop the claim and deposit the gross yield therefrom with one Sayles, who was to deliver such deposit to the vendors in case Harper should fail to pay the purchase price of six thousand dollars, one-half payable by November 1, 1899, and the balance on or before May 1, 1900. It was provided that upon full payment of the purchase price McGregor and Lewis would convey their title to Harper.
Immediately following the execution of the contract Harper took possession of the claim, and on February 9, 1899, entered into a written agreement with the defendants, Sloan and Dwyer, whereby Harper promised to convey to them a two-thirds interest in his contract with McGregor and Lewis upon these terms: Four thousand dollars on or before March 1, 1899, and three thousand dollars on or before June 1, 1899, "and if, [to quote directly from the agreement] in the opinion of the parties of the second part, [Sloan and Dwyer] it should be necessary, the further sum of three thousand (3,000) dollars, on or before the first day of September, 1899." It was stipulated that all of the money so paid, with the exception of Harper's expenses, should be used to pay for work on the claim under his direction and control. The contract further provided that if McGregor and Lewis should convey to Harper under the terms of their agreement, the latter would, "within a reasonable time," make a conveyance to Sloan and Dwyer of a two-thirds interest in the mine, and that "thereafter" Harper should have management and control of the operating of the mine, for which he should be paid "an adequate compensation." There was also a clause in this agreement providing as follows: "If the development and working of the Diadem Quartz Claim should be permanently abandoned by the party of the first part, [Harper] and any money paid by the parties of the second part should be unexpended, the party of the first part shall return the same to J.T. Sloan, one of the parties of the second part."
The pleading contains further averments that "upon the making of said contract last set out plaintiff, on behalf of *Page 186 
himself and said defendants Sloan and Dwyer, continued in the possession of the said property and actually engaged in working the same and commenced to extract the mineral therefrom, and that said plaintiff and said defendants Sloan and Dwyer then actually engaged in the working and development of said claim and extraction of the mineral therefrom, and ever since have continued in the actual working of said claim, and then became and ever since have been mining partners, and that said mining partnership has never been dissolved, except that said defendants Sloan and Dwyer have refused to contribute their proportion of the expenses of the said working of said property other than as hereinafter alleged."
Next follow allegations that defendants paid seven thousand dollars according to the terms of their agreement; that all of this money was expended in actual mining operations; that it became necessary for the working of said property that the further sum of three thousand dollars should be paid on or before September 1, 1899; that plaintiff asked Sloan and Dwyer to pay such amount; but that they refused to do so. There are statements in the pleading that plaintiff and defendants continued in the possession of the claim, "said plaintiff managing and actually working the same for said partnership as aforesaid, and continued in the said working until he had expended upon the said claim all of the said sum of seven thousand (7000) dollars, and other sums of money, exceeding more than two thousand (2000) dollars advanced by himself." It is averred that after the expenditure of more than nine thousand dollars the plaintiff Harper had extracted from the mine eight thousand dollars, out of which he paid the purchase price, six thousand dollars, to McGregor and Lewis, who, on December 8, 1899, conveyed their interest in the property to Harper, "in trust for himself and for said defendants Sloan and Dwyer as provided for in said contract, which said deed was recorded at pages 143 et seq. of Book No. 15 of Deeds, Sierra County Records, to which reference is hereby had, and then and thereby said plaintiff and said Sloan and Dwyer became the owners of said mining claim in equal shares, that is to say, one-third each." We may remark, in passing, that this averment is in direct contradiction of the contracts which did not provide for a conveyance in trust by the vendors to Harper and did not *Page 187 
contemplate the ownership by the defendants of an interest in the claim until an actual conveyance should be made to them by Harper.
Plaintiff pleads the following excuses for not making a deed to Sloan and Dwyer of two-thirds interest in the mine: (a) Plaintiff was informed and believed that on July 17, 1899, Sloan conveyed a one-twelfth interest in the mining property to Lord William Beresford. (b) Sloan instructed plaintiff to make no deed to any person of any portion of the mining claim until he, Sloan, should give further instructions. (c) On May 21, 1901, Dwyer conveyed all of his share in the property to Sloan. (d) Prior to July 2, 1901, Lord Beresford died and his widow, as executrix of his last will, reconveyed to Sloan. (e) Plaintiff, although always ready to execute a deed agreeably to the strict terms of his contract, was unable to ascertain to whom he should convey until further instructed by Sloan.
It is further pleaded that after the execution of the trust deed to Harper he and the defendants, as mining partners, continued to work the claim. This work was prosecuted until the end of December, 1900, but yielded no profit. Plaintiff called upon defendants to contribute to his expenses the three thousand dollars "as provided in the contract," but they refused to make further payments, although Sloan consented to the work and advised Harper to continue it. Acting upon said advice, and with Sloan's approval, plaintiff "continued the said work until said partnership became indebted in the sum of about Two thousand (2000) dollars, during the said year 1900."
To pay this indebtedness Harper mortgaged the mine to Sayles for $1,377.84, and thereafter, Sayles' assignee demanding payment and Sloan and Dwyer refusing to contribute to the settlement of said debt, Harper negotiated a loan from Sharon and executed a note and mortgage for $2,252.30 to pay the Sayles note and discharge the earlier mortgage.
From December, 1901, plaintiff was unable to work the claim continuously, but each year, to and including 1913, he expended for the alleged partnership more than one hundred dollars for assessment work.
Plaintiff sues for compensation for all of his time employed in the management and control of the property for more than one year and six months up to the end of December, 1900, and *Page 188 
for one month of each of the following thirteen years; also for the taxes paid by him until 1913, inclusive.
There are allegations that Dwyer departed from California about four months after entering into the contract with Harper and did not return, and that Sloan departed at the same time but returned to California in December, 1900, remaining but five months, during which time he was informed of the conditions of the mining property "and of its indebtedness, and he consented to the same and promised to pay and advance to the said partnership the whole thereof."
It will be seen at once that appellant's claims against the defendants must depend upon the existence of a mining partnership as defined by section 2511 of the Civil Code, which is as follows: "A mining partnership exists when two or more persons who own or acquire a mining claim for the purpose of working it and extracting the mineral therefrom actually engage in working the same."
Examining the written instrument which is pleaded as the basis of the claims of Harper against defendants, we see at once that it is not a copartnership agreement whereby from its execution Harper, Sloan, and Dwyer were to work the claim as partners. The others advanced money for the purchase of Harper's interest in the mine in case he ever acquired any interest. There was no provision by which they were to share in the output or be responsible for Harper's expenses in the operation of the property until there should have been an actual conveyance of an interest to them by Harper after he should have acquired it from the original locators. Toward them Harper did not sustain the relation of a mining partner, for he had not owned nor acquired the claim with them for the purpose of working it and extracting the mineral therefrom. He was in much the same position as was the plaintiff in Stuart v. Adams,89 Cal. 367, [26 P. 970], who had contracted with the owners to work the mine, pay one-half the expenses thereof, and receive one-half of the product for his labor — such an arrangement as this court decided does not make the parties to it mining partners. Harper's arrangement with his vendors differed only from the one discussed in the Adams case in that he was to pay all of the expenses of working the mine and to place the product in escrow, meanwhile having nothing but an option to purchase the claim and the product within a certain time for a stated amount of *Page 189 
money. Similarly the contract of Harper with the defendants gave the latter the right to a conveyance of part of Harper's interest if he ever should purchase, after which he should be entitled to an adequate consideration for "the management and control of the operating of said mine." We see no escape from the conclusion that there was to be no partnership until Sloan and Dwyer became part owners.
The excuses offered by plaintiff in his pleading for his failure to convey are not sufficient. Sloan's rumored conveyance to Lord Beresford surely was not sufficient reason for Harper to ignore the terms of his agreement with defendants. Nor did Sloan's instructions to delay conveyance justify a change in the written agreement, and, of course, such directions were of no effect in relation to Dwyer. Nor did Lady Beresford's reconveyance to Sloan operate to change the contract. Dwyer's conveyance to Sloan had no such effect, either. Both of the transactions last mentioned occurred more than a year after plaintiff obtained title, and he never had created a mining partnership nor any other sort by making the conveyance prescribed by the written agreement to be made within a reasonable time after he should become the owner of the claim. The engagement of the defendants was to buy a two-thirds interest in a mine if it should be acquired. They paid seven thousand dollars for such interest, but Harper worked the mine on his own account and never carried out his promise to convey. Therefore, he cannot take advantage of his own violation of the agreement of sale and at this late day seek to compel defendants to pay a mortgage placed by him upon his own property without their consent. Nor may he compel them to compensate him for work done upon his own claim without authorization from them. A contract to buy an interest in a mine is not a mining contract. (Prince v. Lamb, 128 Cal. 120, [60 P. 689).] An agreement to the effect that if A should secure a paying mine through the efforts of B, said A would, in addition to wages, give B an interest in the mine is not an agreement establishing a mining partnership. (Berry v.Woodburn, 107 Cal. 504, [40 P. 802].) An agreement that upon the happening of some contingent future event the parties to the contract will operate a mine does not constitute a mining partnership. (Dorsey v. Newcomer, 121 Cal. 213-216, [53 P. 557].) *Page 190 
The conveyance of the property to plaintiff in trust for him and the defendants did not create a mining partnership. Before they could be charged as partners they must have engaged in working the mine. (Peterson v. Beggs, 26 Cal.App. 760, [148 P. 541].)
As there was no mining contract the whole fabric of appellant's argument is destroyed, and it follows that the superior court did not err in sustaining the demurrer.
Judgment affirmed.
Henshaw, J., and Lorigan, J., concurred.