Court Opinion

ID: 8858004
Source: CourtListenerOpinion
Date Created: 2022-11-26 17:37:09.54463+00
Date Added: 2024-06-11T17:05:43.628398
License: Public Domain

LOCHREN, District Judge,
after stating the case as above, delivered the opinion of the court.
1. The lease executed by the appellant to Robert H. Reid on April 1, 3 895, was valid and effectual as a lease and demise of the mining property. The covenants constituted a valuable and sufficient consideration, and under the lease he on that day became entitled to the immediate possession and use of the leased property, and it is admitted that the possession of the property passed on that day from the appellant to said Reid.
2. The terms of the lease did not constitute Reid the agent of the appellant in organizing the United Leasing Company. It was competent for the lessor to stipulate in its lease that the lessee should organize such a company to assume the lease and carry on the business, and Reid, in organizing such company, was fulfilling Ids covenants in that behalf. So also the provision that the stock of such new company should first be offered to stockholders of the appellant to subscribe for, or not, at their option, would not make fhe new corporation identical with the appellant, even if all the stock had been so subscribed for a.s to have included all the stockholders of the appellant. The corporation would not only differ in organization, but in objects and functions. Richmond & I. Const. Co. v. Richmond, N. I. & B. Ry. Co., 15 C. C. A. 289, 68 Fed. 105; Exchange Bank of Macon v. Macon Const. Co. (Ga.) 25 S. E. 326. It follows from the foregoing that the possession and working of the mine passed from the appellant on April 1, 1895, to its lessee, Reid, and soon afterwards to the United Leasing Company, upon Reid’s transfer of the lease, and that at the time of the furnishing of material by the appellee and other lieu claimants the mine was being worked, not by the owner, the appellant, but by its substituted lessee, tbe United Leasing Company, under the lease which took effect, and under which the lessee entered into the possession of the mine, on the 1st day of April, 1895.
3. The lien law of Colorado at the time this lease went into effect provided for a lien in favor of all persons who should perform work or furnish material in the working of a mine, but with this exception: “Provided further, that this section shall not be deemed to apply to the owner or owners of any mine, lode, deposit, shaft, tunnel, incline, adit, drift, or other excavation, when the same shall be worked by lessee, or lessees.” Sess. Laws Colo. 1893, p. 321, § 8. On April 33, 3895, by another act of the legislature of Colorado, tin; proviso was changed so as to read as follows: “Provided further. that this section shall not be deemed to apply to the owner or owners of any mine, lode, deposit, shaft, tunnel, incline, adit, drift, or other excavation, who shall lease the same in small blocks *520of ground to one or more sets of lessees.” Under the proviso in the act of 1893, first above quoted, and which was in force when the’ lease went into effect, the title of the appellant to the mine could not be subjected to any lien for material furnished to the lessee in working the mine. Any subsequent change in the statute law which, without the consent of the lessor, would subject its property to the payment of debts of the lessee, would seriously and injuriously affect the right and title of the lessor in the leased property. The amendment of 1895 must be held to have a prospective operation only, and to be applicable only to leases made after its enactment. To hold that it applies to past leases is to give it a retrospective operation, contrary to the express inhibition of section 11 of article 2 of the constitution of Colorado. Railway Co. v. Woodward, 4 Colo. 162; Lundin v. Railway Co., 4 Colo. 433. Wherefore it is ordered that so much of the decree appealed from as awarded a judgment against the United Leasing Company for the sum of |5,199.85, together with costs of suit, be, and the same is hereby, affirmed, and that the residue of said decree be reversed and annulled, and that the bill of complaint be dismissed, as against the United Mines Company, at the cost of Ernest J. Hatcher, complainant.