445 P.2d 334 (Wash. 1968), 38974, Silver Surprize, Inc. v. Sunshine Min. Co.

Docket Nº:38974.
Citation:445 P.2d 334, 74 Wn.2d 519
Opinion Judge:NEILL,
Party Name:SILVER SURPRIZE, INC., a corporation, Appellant, v. SUNSHINE MINING COMPANY, a corporation, Respondent.
Attorney:Witherspoon, Kelley, Davenport & Toole, John L. Neff, Spokane, for appellant., Keith, Winston & Repsold, Leo J. Driscoll, Spokane, for respondent.
Judge Panel:FINLEY, C.J., and HILL, WEAVER and HAMILTON, JJ., concur. ROSELLINI, HALE and McGOVERN, JJ., concur.
Case Date:September 26, 1968
Court:Supreme Court of Washington

Page 334

445 P.2d 334 (Wash. 1968)

74 Wn.2d 519

SILVER SURPRIZE, INC., a corporation, Appellant,


SUNSHINE MINING COMPANY, a corporation, Respondent.

No. 38974.

Supreme Court of Washington, En Banc.

September 26, 1968

[74 Wn.2d 520]

Page 335

Witherspoon, Kelley, Davenport & Toole, John L. Neff, Spokane, for appellant.

Keith, Winston & Repsold, Leo J. Driscoll, Spokane, for respondent.

NEILL, Judge.

The plaintiff (appellant), Silver Surprize, Inc., an Idaho corporation, brings this action under an agreement entered into with the defendant (respondent), Sunshine Mining Company, a Washington corporation, seeking damages and other alternative remedies. The defendant's answer and amended answer admitted the contract, and set up six affirmative defenses: (1) extralateral rights, (2) adverse possession, (3) statute of limitations, (4) laches, (5) lack of an indispensable party (Sunshine Consolidated), and (6) failure of the plaintiff to tender back the benefits received under the contract. Defendant then filed an application for a hearing and determination of jurisdictional defenses as provided under CR 12(d). At the conclusion of the argument on the issues of law thus raised, the court dismissed the suit on the ground that the case was essentially local in nature and that it lacked jurisdiction over the subject matter. Plaintiff appeals from this ruling.

The following facts appear from the record. On November 2, 1946, the parties entered into an extensive written agreement involving ownership, exploration and exploitation of certain unpatented mining claims in the Yreka Mining District of Shoshone County, Idaho. The agreement provided that the plaintiff and the defendant would exchange conveyances to certain individually owned claims; so that they would each be the owner of an undivided 50 per cent interest in a group of claims described as the 'Surprize Group.' This exchange of conveyances was completed, as called for in the contract. The defendant's performance involved certain further obligations, since it promised to perform exploration and annual assessment work, to initiate patent proceedings and to conduct commercial mining operations upon the claims for the benefit [74 Wn.2d 521] of both parties. The complaint alleges that the defendant failed to perform the exploration work as promised. Plaintiff also alleges that the defendant has breached the contract in two additional respects: (1) by constructing and using haulage ways under the Surprize Group property in order to explore and exploit other adjacent properties possessed or controlled by the defendant and in which the plaintiff has no interest; and (2) by removing and disposing of ore from the so-called 'Yankee Girl' ore body which is located at a depth of several thousand feet below the surface of and within the northerly boundary of the Surprize Group claims. Plaintiff alleges the gross value of the ore taken to be in excess of $5,000,000, and that the defendant violated the contract by withholding plaintiff's agreed share of the proceeds of the ore.

Page 336

Plaintiff prays for three alternative types of relief: (1) rescission of the contract, and an order requiring the defendant to reconvey and to make restitution for the value of the ore removed by the defendant from the Surprize Group; (2) termination of the contract, an order of reconveyance, and damages for the value of the ore removed; or (3) an accounting, continuing equitable supervision of exploration activities, and other declaratory and injunctive relief.

Defendant's answer and amended answer, the argument on the hearing and determination of jurisdictional defenses, and the briefs and argument on this appeal disclose that the principal defenses to the alleged breach of contract are two. First, the defendant claims extralateral rights in the Yankee Girl vein. The defendant's theory is that the Yankee Girl vein apexes outside the Suprize Group on property owned or claimed by it, or by a third party, Sunshine Consolidated, and that 30 U.S.C. § 26 (1964) accords it extralateral rights to follow the vein into the Surprize Group. Secondly, the defendant asserts ownership by adverse possession of that portion of the Yankee Girl vein which passes into the Surprize Group.

The record is clear that plaintiff's claim is based on (1) a contract; (2) breach thereof; and (3) damages. Defendant's [74 Wn.2d 522] affirmative defenses thereto which are the basis of the court's dismissal are (1) adverse possession and (2) extralateral rights. The trial court dismissed the suit on the grounds that the subject matter is, in essence, the determination of title to Idaho real estate.

It is not disputed that the proper parties are Before this court and that the court has personal jurisdiction over all parties involved. The basic question therefore is: what is the subject matter of this suit? 'The subject matter of a suit, when reference is made to questions of jurisdiction, means the nature of the cause of action, and the relief sought.' 21 C.J.S. Courts § 35b (1940). State ex rel. Washburn v. Hutchins, 101 Fla. 773, 135 So. 298 (1931); State ex rel. Chiry v. Iowa Co-Operative Ass'n, 248 Iowa 167, 79 N.W.2d 775 (1956); King v. Menz, 75 N.W.2d 516 (N.D.1956); In re Edinger's Estate, 136 N.W.2d 114 (N.D.1965); Bailey v. Ancient Egyptian Arabic Order, 16i Pa.Super...

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