Common Sense Min. & Mill. Co. v. Taylor

• Decision Date: 30 November 1912
• Citation: 152 S.W. 5,247 Mo. 1
• Court: Missouri Supreme Court
• Parties: COMMON SENSE MIN. & MILL. CO. v. TAYLOR et al.

152 S.W. 5

247 Mo. 1

COMMON SENSE MIN. & MILL. CO. v. TAYLOR et al.

Supreme Court of Missouri, Division No. 1.

November 30, 1912.

Rehearing Denied December 24, 1912.

1. CORPORATIONS (§ 426) — CONTRACTS — ESTOPPEL.

Where the purchaser notified the president of the corporation vendor that he thought he had certain third parties who would buy the property, and requested an extension of the time allowed him for closing his own purchase of the property, and such extension was granted him by the president by wire, and where the purchaser showed such third parties his original contract and the wire, and upon strength of same they purchased from him, took possession, paid certain of the corporation's debts as consideration, and made valuable improvements without any objection being made, the corporation was estopped, after five months' delay, to sue for recovery of the property and damages upon the ground that the extension granted by its president was unauthorized, especially where it made no offer to place defendants in statu quo.

2. CORPORATIONS (§ 542) — POWERS OF DIRECTORS — SALE OF PROPERTY.

The directors of a mining corporation in failing circumstances could legally dispose of its assets to pay its debts.

3. CORPORATIONS (§ 432) — CONTRACTS — VALIDITY — PRESUMPTION.

A mining corporation's contract to sell property was presumptively duly authorized where it recited that it was fully authorized by its directors and was valid on its face.

4. CORPORATIONS (§ 428) — CONTRACTS — KNOWLEDGE OF OFFICERS.

Where the president of a mining corporation knew that the property sold by the corporation had in turn been sold by the purchaser to third parties who as consideration paid certain of the corporation's debts, and then took possession and made valuable improvements, the corporation in an action for possession of the property and damages was chargeable with the knowledge of its president.

5. CORPORATIONS (§ 426) — CONTRACTS — RATIFICATION.

Where the president of a mining corporation granted to a purchaser of the corporation's property an extension of time for closing the trade, and the corporation knowingly acquiesced in such act for five months while third persons bought the property from the purchaser, and as consideration paid certain debts of the corporation and then took possession and made valuable improvements, such delay and acquiescence amounted to a ratification of the extension agreement.

Appeal from Circuit Court, Jasper County; Hugh Dabbs, Judge.

Action by the Common Sense Mining & Milling Company against H. L. Taylor and others. From a judgment for defendants, plaintiff appeals. Affirmed.

Both pleadings and proof in this cause are voluminous in the extreme. Plaintiff, a Missouri corporation, by its petition sues for the possession of a certain mining property in Jasper county, Mo., which it formerly held and possessed under a mining lease from another company. Monthly rents and profits are alleged to be $2,400. Waste is also charged in the aggregate sum of $25,000. The petition concludes with the prayer: "Wherefore plaintiff prays judgment for the recovery of said premises and $40,000, damages for unlawfully withholding the same from plaintiff, and the waste and injury aforesaid, and the rents and profits down to the time of assessing the same, and $2,400 per month for monthly rents and profits from the rendition of judgment until possession is delivered to plaintiff, and costs," etc. In fact, there was nothing small about plaintiff's case but the result nisi, which was to the effect that plaintiff had no interest in the property and was entitled to no damages therefor. Not only so, but an affirmative decree that defendants Moore and Bushnell in good conscience were the owners of the property and were so decreed it.

The case made and tried nisi is well indicated by the answer and the reply. The answer of Taylor, omitting from a contract pleaded the schedule of debts and machinery, is:

"Now on this day comes defendant H. L. Taylor and for his separate amended answer to plaintiff's petition herein denies each and every allegation therein contained, except such as are hereinafter expressly admitted. And for further separate answer this defendant says that on or about the 18th day of April, A. D. 1906, plaintiff was in possession, claiming to be the owner of a certain mining lease, granting to plaintiff the right to mine and use certain mining machinery belonging to the New York & St. Louis Mining & Milling Company on a certain tract of land situate in the county of Jasper and state of Missouri, and described as follows, to wit: The east one-half of the forty acres known as the `Royal Lease' more particularly described as follows: The east one-half of the southwest quarter of the northeast quarter of section thirty-three, township twenty-eight, range thirty-two. Said lease being for a term ending January 1st, 1912, with an extension provided for a further term ending January 1st, 1916. And that said plaintiff was in possession of and claimed to be the owner of certain other machinery, tools and supplies located on said lease and other accounts, credits and assets located in Jasper county, Missouri; that plaintiff then and there being embarrassed by accounts unpaid and debts contracted in running and operating said mining lease and machinery amounting to approximately $3,800.00, and having no money or means with which to pay the same, and being desirous then and there of having said indebtedness liquidated, as a means thereto and providing therefor, plaintiff agreed to sell, assign and transfer all of its property and assets in Jasper county, Missouri, to this defendant for and in consideration of the sum of one dollar and the assumption by this defendant of the aforesaid mentioned debts and indebtedness, and this defendant agreed to purchase the same on the terms and for the consideration aforesaid, and thereupon an agreement in writing was made and entered into by and between the plaintiff and this defendant herein, being in words and figures as follows, to wit: `Know all men by these presents that the Common Sense Mining & Milling Company, a corporation of the state of Missouri, party of the first part, and H. L. Taylor, of Joplin, Missouri, party of the second part, witnesseth: That the said first party, for and in consideration of one dollar and the assumption and payment by the said second party of all debts of said first party amounting to about $3,800.00, a schedule whereof is hereto attached and made a part hereof. The said first party hereby agrees to sell and assign to said second party or to his assigns all the property of said first party being situate in the county of Jasper, Missouri, to wit: Lease on 20 acres of mineral ground belonging to B. F. Horton and Luck K. Smith, more particularly described in the lease to one Coburn, of record in said Jasper county, and released to the New York & St. Louis Mining & Metal Co., and in lease executed by said Horton and Smith to the said first party dated the ____ day of January, 1906, and recorded in Book ____, at page ____ in the office of the recorder of deeds for said Jasper county, at Carthage, Mo., together with all machinery, tools and supplies at the mines, accounts and credits, an inventory whereof is hereto attached and made a part hereof. The said second party accepts said property with the understanding that this is full and complete payment and discharge of all claims or debts against or due by said first party contained in the schedule hereto attached or any other just and legitimate claim not scheduled, but inadvertently omitted therefrom. That the sale and assignment herein provided shall be concluded and fully executed within ten days from the date hereof and that in the meantime till such consummation said second party to have care and custody of said property, to be relinquished at the expiration hereof should this conveyance not be followed by deed as herein contemplated. In witness whereof, the said parties have hereunto subscribed their names and affixed their seals. The said first party, its corporate seal affixed by authority of its board of directors and the said second party his scroll seal. This 19th day of April, 1906. Common Sense Mining & Milling Co., G. A. Sanderson, President. H. L. Taylor. [Seal.] Attest: J. A. Farquhar, Secretary.' (Schedule of debts and machinery omitted.)

"That afterwards and on, to wit, the 27th day of April, 1906, it was agreed by and between the plaintiff and this defendant that said above-mentioned contract be, and the same was then and thereby extended for, a further period of 10 days. This defendant further states that, relying on the promises and agreements made by said plaintiff in said written contract and the extension thereof, he proceeded at much cost and expense to himself in both time and money to induce capital to invest in said property. That he did, within the time mentioned in said contract and the extension thereto, induce F. W. Moore and J. W. Bushnell of the city of East St. Louis, Ill., to purchase said property in said contract mentioned and to pay therefor a sum of money sufficient to pay off and discharge the obligations of said plaintiff in manner and form as provided in said contract and the extension thereof. That, in order to induce the said F. W. Moore and J. W. Bushnell to purchase said property aforesaid and to pay therefor the amount of money sufficient to discharge the obligations of the said plaintiff as aforesaid, it became necessary for this defendant to and he did exhibit to them the aforesaid contract and acquaint them of the provisions thereof, and promise and agree with them to continue in control of and assume the active management of the mining property mentioned in said contract, under an agreement with said F. W. Moore and J. W. Bushnell that they would give him in consideration of his future management of said property a contingent...