Silver Surprize, Inc. v. Sunshine Min. Co.

• Citation: 445 P.2d 334,74 Wn.2d 519
• Decision Date: 26 September 1968
• Docket Number: No. 38974,38974
• Court: United States State Supreme Court of Washington
• Parties: SILVER SURPRIZE, INC., a corporation, Appellant, v. SUNSHINE MINING COMPANY, a corporation, Respondent.

Page 519

74 Wn.2d 519

445 P.2d 334

SILVER SURPRIZE, INC., a corporation, Appellant, v. SUNSHINE MINING COMPANY, a corporation, Respondent.

No. 38974.

Supreme Court of Washington, En Banc.

Sept. 26, 1968.

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 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.

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 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. 5, 56 A.2d 311 (1948); Cooper v. Reynolds, 77 U.S. (10 Wall.) 308, 19 L.Ed. 931 (1870); Ransome-Crummey Co. v. Martenstein, 167 Cal. 406, 139 P. 1060 (1914); Lake Shore & M.S. Ry. Co. v. Clough, 182 Ind. 178, 104 N.E. 975, 105 N.E. 905 (1914).

The nature of a claim for relief is determined by the facts alleged in the complaint and as adduced thereunder, and by the relief requested. The facts alleged in the complaint at bar are as set forth above, namely, a contract, breach of the contract, and damages. All of the relief sought by the plaintiff is consistent with a recovery for a breach of contract. The subject matter of plaintiff's complaint is patently a contract action. The United States Supreme Court stated in United States v. Arredondo, 31 U.S. (6 Pet.) 691, 709, 8 L.Ed. 547 (1832):

The power to hear and determine a cause is jurisdiction; it is 'coram judice,' whenever a case is presented which brings this power into action; If the petitioner states such a case in this petition, that on a demurrer, the court would render judgment in his favor, it is an undoubted case of jurisdiction; whether on an answer denying and putting in issue the allegations of the petition, the petitioner makes out his case, is the exercise of jurisdiction conferred by the filing of a petition containing all the requisites and in the manner prescribed by law. (Italics ours.) (Quoted in Brown, Jurisdiction § 2 p. 6 (2d ed. 1901).)

Jurisdiction is not a light bulb which can be turned off or on during the course of the trial. Once a court acquires jurisdiction over an action it retains jurisdiction over that action throughout the proceeding. 'Consent cannot confer jurisdiction of subject matter.' Brown, Jurisdiction § 3 p. 15 (2d ed. 1901). Neither can the defendant by his answer destroy the jurisdiction of the court once attained. Adair v. Crepps, 81 Ohio App. 136, 76 N.E.2d 287 (1947); Nichol v. Patterson, 4 Ohio 200 (1829); Bridgmans v. Wells, 13 Ohio 43 (1844). Also see Threadgill v. Federal Land Bank of Houston, 26 S.W.2d 345 (Tex.Civ.App.1930); and Scarborough v. Powell, 2 Tex.Ct.App.Dec.Civ. p. 644 (1885). If the converse of this were true, it would be within the power of the defendant to preserve or destroy jurisdiction of the court at his own whim. The source of the jurisdiction of the superior courts is the constitution of this state (Const. art. 4, § 6 (amendment 28)) and not the parties defendant to actions. Of course, a plaintiff frequently seeks more than the law permits, but that in itself does not destroy jurisdiction; it merely limits the effective relief the court can properly grant. Monongahela Power Co. v. Shackelford, 142 W.Va. 760, 98 S.E.2d 722 (1957). During oral argument counsel for plaintiff acknowledged such a limitation herein as to certain of its prayers for relief.

Plaintiff commenced this transitory action for breach of contract. The defendant answered the complaint by asserting that it had not breached the contract, and that it owns title to the ore removed. The following questions therefore arise: Can a defendant by his answer change the essence or subject matter of an action? Can a defendant by his answer change a transitory action into a local one? Our research has not found a case in which a court has answered either of these questions in the affirmative. In Sheppard v. Coeur D'Alene Lumber Co., 62 Wash. 12, 112 P. 932, 44 L.R.A.,N.S., 267 (1911), this court answered both of these questions in the negative.

In Sheppard v. Coeur D'Alene Lumber Co., supra, the plaintiff commenced an action in Washington state to recover rent for the use and occupation of real estate located in the state Idaho. The defendant denied that it owned any rent and asserted that it owned the land by right of adverse possession. At the end of the plaintiff's case a nonsuit was entered on the ground that the action was one 'affecting the title' to real estate nor within the jurisdiction of the court. The Supreme Court reversed, stating at 14, 112 P. at 932:

We do not think the action affects the title to the property within the meaning of the statute. The purpose of the action is to recover a money judgment for the reasonable rental value of the property. In other words, the action is for the breach of an implied contract. Under the averments of the complaint, the respondents are tenants by sufferance and liable for the reasonable rental value. The fact that the answer sets up title in the respondent, and brings the title incidentally into issue, does not make the action a local one. It is not sought to obtain a judgment which will in any manner affect title. That question must be left to the courts of the forum Rei sitae. If...